Trust comes with a cost
Scheer’s endless promises ammo for Liberals
Andrew Scheer is right about one thing — this election is going to be all about trust.
None of the issues have punched through, as the parties cancel each other out with tit-for-tat spending commitments, all paid for with borrowed money.
Scheer says you can’ t trust Justin Trudeau — “he’s not who he says he is,” which is as close to referring to the blackface scandal as he has come in recent days.
Trudeau hardly mentions Scheer but referred to Ontario Premier Doug Ford 15 times in his pharmacare announcement on Monday. He suggests Scheer will do to Canada, what Ford has done to Ontario — that is, make massive cuts to public services.
Scheer has fought back in lacklustre fashion by conjuring up the nightmare of Liberal governments past, specifically those of Kathleen Wynne and Dalton McGuinty in Ontario.
But he is wide open to the charge that he will slashand- burn services because every day he makes new spending promises, while saying he will return the budget to balance within five years.
On Tuesday, he was at it again in a pub in the Ontario riding of Niagara Centre, currently held by Liberal Vance Badawey.
Scheer said he will repeal the tax increases the Trudeau government applied to small businesses and cut red tape across the board. Readers will recall one of the Trudeau government’s more tone-deaf experiments in squeezing money from taxpayers when in 2017 it tried to tax passive investment income inside small businesses. The goal, the Liberals claimed, was “tax fairness” — the belief that some business owners were amassing personal savings inside corporations to defer from paying higher income taxes. But the messaging around it was not helped by Trudeau suggesting “wealthier Canadians” who were using passive investments were cheating on their taxes.
Scheer’s approach, quite rightly, is that small businesses are the “drivers of prosperity and not a source of revenue,” so he plans to overturn those tax increases, even though they were toned down in budget 2018 as a result of the public protest and the government was forced to introduce a small business corporate tax cut to placate angry voters.
That is Scheer’s choice, and perfectly in keeping with the Conservative brand.
But it comes with a cost — $ 534 million in 2020-21, according to the Parliamentary Budget Officer.
That is on top of the $ 10 billion or so he has already promised in various tax cuts and credits ( not to mention the $ 20 billion already projected by the Liberals this fiscal year).
Scheer has promised to bring the budget back to balance over five years, and also pledged to increase Canada health and social transfers by at least three per cent every year.
Beyond transfers to the provinces, the federal government spends nearly $ 160 billion a year directly on things like defence, First Nations and agricultural support. Scott Clark and Peter Devries, two former senior public servants in the Department of Finance, suggest Scheer may have to cut 10 per cent from these programs if he wants to reach balance without increasing taxes.
When the Conservative leader was confronted with this inconvenient truth, he brushed it off, saying he has already committed to go after corporate welfare (saving $1.5 billion) and will reveal his fully costed fiscal plan before the end of the campaign.
When he does, the Liberals will be on him like lions on a gazelle. It will be proof positive that Andrew Scheer is just Doug Ford with dimples, they will claim. Trudeau believes most voters don’t care about deficits, hence he has added to them with abandon, but that they do worry about service cuts. He is probably right.
How this plays out in Ontario is likely to determine the election. In 2011, the Conservatives won 44 per cent of the vote in the province, taking 73 seats. In 2015, the party claimed just 35 per cent of the vote, and 33 seats. They are currently sitting at where they were four years ago in an average of public polls. Scheer must see steady progress in Canada’s most vote- rich province in the next few weeks if he is going to become prime minister.
He needs to persuade Canadians, and particularly Ontarians, that they can believe him. But how can they believe him when his core commitment — that he will put more money in your pocket, while balancing the books and maintaining public services — does not add up?
(SMALL BUSINESSES ARE THE) DRIVERS OF PROSPERITY AND NOT A SOURCE OF REVENUE.