Battle of the credit card warriors

Something weird is going on in the world of Canadian conservatism, if your understanding of “conservative” means people who think you should be able to pay for the things you consume.

That’s always been a big deal in the conservative world view. To be conservative, you don’t have to be against spending plans, welfare plans, benefit plans or the myriad other ways governments find to spend money in hope of gaining votes. You do have to feel it’s important that those plans can be paid for.

Also — and this is crucial — being able to pay for something doesn’t mean having the ability to continually borrow more money to keep things afloat. Any responsible adult knows that sound finance doesn’t mean being able to barely scrape together enough cash at the end of the month to meet the minimum payment on a maxed-out credit card.

Conservatives — the ones with the capital “C”, who join the political party of the same name — have complained long and loud over the years about the other parties’ irresponsible attitudes in this regard. Liberals, they say, are willing to borrow any amount for any reason if they think it will win them votes, no matter how much risk they run, or how damaging their actions may prove in the long run. New Democrats ... well, New Democrats are from Mars when it comes to understanding how money works. No need to even try to make sense of an NDP budget plan.

Big “C” Conservatives, though, are supposed to be conservative. Even if it means they have to grit their teeth while Liberals run around gleefully throwing borrowed cash at an eternally credulous country.

That’s no longer the case, or wouldn’t seem to be, if you go by the costing plan for the Conservative platform, released on the eve of Wednesday’s leaders’ debate.

Tory Leader Erin O’toole has been trying hard to convince Canadians his party has changed. Don’t confuse it with Stephen Harper, Andrew Scheer or other previous leaders, he says. This Conservative party wants to protect working people, help families support elderly parents, shore up a deeply stressed health-care system and, in general, recognize that the world of 2021 is a far cry from the one we knew even a decade or so ago. There are tectonic shifts going on across the planet, and they have to be acknowledged and prepared for. Reality bites.

Whether Conservative spending plans help get us there is up for debate, but they are certainly a break from the past. The Tory plan starts with a deficit of $168 billion and falls to $25 billion by 2025-26, while the Liberals’ plan projects a deficit of $157 billion now and $32 billion in 2025-26. Big difference, eh?

The Tories say you can’t take Liberal numbers seriously, given their long history of promising prudence while running up massive debts. These are the guys who said, in 2015, that they’d never run a deficit over $10 billion, and the budget would balance itself. Since then deficits have exploded and they’ve doubled the debt.

OK fine, but now O’toole appears willing to match them. A Conservative government would chop some Liberal spending, but, rather than use it to strengthen the bottom line, would just spend it on something else. O’toole no longer even pretends he’d balance the budget in anything under a decade, and only then if nothing unexpected ever happens, every government between now and then shows courage and restraint in handling money, and government minions somehow find billions of dollars that aren’t needed elsewhere to fill in some big gaps.

Good luck on that. The Liberals have been saying the same thing forever, and it never works.

Whether O’toole is right or wrong is almost a moot point. Fifty years of untamed borrowing, topped by six years of Prime Minister Justin Trudeau’s drunken credit-card binge, have left the national finances so deeply in hock that no reasonable person could credibly claim they could be brought to balance short of painful spending cuts or serious tax hikes.

Facing similar pressures British Prime Minister Boris Johnson — another Conservative — this week pushed through tax hikes that will raise the U.K. tax burden to its highest level in 70 years. The plan includes an increase of 1.25 percentage points in a national payroll tax on all working adults, including pensioners and seniors, and a separate 1.25 point increase in a tax on dividends. The aim is to raise about $21.5 billion a year, to be spent on health care and social services. Conceding that the plan violates a specific Tory pledge to keep taxes unchanged, Johnson said: “This new levy will break our manifesto commitment ... But a global pandemic wasn’t in our manifesto either.”

It’s notable that in gaining passage for the plan, Johnson had to face down attacks from both left and right. Criticism from the right might be predictable, but left-wingers seem outraged that a Conservative would steal their thunder by advocating badly needed changes in social programs, while making people pay for them to boot. The higher tax on dividends even lets Tories claim they’re “making the rich pay.”

It may be that the British leader has a stiffer backbone than his Canadian counterpart, or perhaps it’s a case of two men who understand they lead countries with very different points of view. Johnson has an overwhelming majority in the House of Commons, and won the vote by a comfortable margin.

But Canada is a country that doesn’t appear prepared yet to accept that you can’t borrow your way to prosperity without making serious payback plans, and that years of continually spending beyond our means will eventually have to end.

Maybe we’ll get there still. If not there’s a very good chance it will be forced on us. In the meantime O’toole’s case comes down to a view that if we have to keep borrowing and spending, it’s better to spend on Tory priorities rather than Liberal priorities. Let others decide whether that’s Conservative, conservative, or something else all together.

THIS NEW LEVY WILL BREAK OUR MANIFESTO COMMITMENT.