Feel the pain
Austerity is not the word for it. The 2016 provincial budget is verging on draconian. Literally no one has been spared from Finance Minister Cathy Bennett’s hatchet. Several programs and subsidies have been slashed, including the baby bonus and home heating supplement. Of course, there’s a new income supplement, but it doesn’t entirely offset the hit to people’s pockets. Numerous taxes and levies are going up, including income tax. HST will be 15 per cent, despite Premier Dwight Ball’s solemn vow to keep it at 13. Gas tax will jump an extra 16.5 cents a litre. Hundreds of jobs, public and private, will be lost. For those who hoped for more of a burden on the rich, there’s a bizarrely regressive debt levy. That’s right, everyone except those in abject poverty will have to pony up extra money for the next few years specifically to help feed the monster. And get this: if your household makes about $40,000, you’ll owe $450. If you make 10 times that, the amount only doubles. Fair? Hardly. There’s a lot of blame flying around for this current mess. Former premier Danny Williams and subsequent Tory premiers have been getting a lot of it. And while we would have been in a hole regardless, it’s accurate to say the size of the hole has a lot to do with Williams’ tenure in office. “We haven’t just taken a piggy bank filled up with oil and spent it,” Williams told The Globe and Mail in 2010, just after leaving politics. “We have to spend our money wisely. We have to put in the proper infrastructure - roads, schools, hospitals, broadband, a proper communications infrastructure - so that we can encourage people to come and live and work and prosper here. That’s always been the game plan.” Well, he was partly right. Infrastructure and public services are important. But he certainly did drain the piggy bank. By 2011, government spending had increased by a whopping 83 per cent under the Tory government. That, despite repeated warnings from the auditor general that the province was being too reckless with its oil boom royalties. In fact, the warnings came from many sides, including the opinion pages of this newspaper. Pick any budget, and you’ll see the same concerns raised. From the April 8, 2011 Telegram editorial, the first under Kathy Dunderdale’s reign: “There is no doubt that oil is helping us live very well. But without these dollars, we are living well beyond our means, and we’ve had plenty of warning that the oil dollars aren’t likely to last.” Here’s Russell Wangersky from the year before: “The province is making much-needed improvements in the present. The question is whether we can afford them in the future, or whether it would be better to tighten belts now, and reinvest the windfall for the future.” And none of this takes into account the doubling of our debt burden and soaring electricity rates we face because of Muskrat Falls. The Liberals may or may not have gone overboard in this austerity budget. But the hole they faced could have been a lot less cavernous, too.