A NEW PATH FORWARD
WE SHOULD LEAD THE WORLD BACK TO HARD CURRENCIES. — CONRAD BLACK
WE HAVE NOT HAD AN ORIGINAL FISCAL OR MONETARY THOUGHT IN CANADA SINCE THE HOUSING BUBBLE BURST IN 2008.
Once again, it is my duty to remind readers that our federal government is apparently preparing to call a premature election based on what it believes to be the popularity it has earned for its handling of the COVID crisis. Apart from fatalities per capita, in which Canada’s performance is strong among advanced countries that provide believable information, the chief measurement of this country’s handling of the pandemic at this stage of the game is the percentage of people who have been fully vaccinated. By this criterion, Canada ranks 62, at 2.6 per cent. Among the countries that are less developed and have less-advanced public health services than Canada are, in ascending order of their superiority to us in this vital statistic, Montenegro, Cambodia, Croatia, Mexico, Panama, Azerbaijan, Brazil, Costa Rica, the Dominican Republic, Romania, Turkey, Morocco, Uruguay, Chile and Northern Cyprus (the Turkish part of that island, which has five times the percentage of vaccinated people as Canada does).
In the last 15 months, the federal debt has increased by $1 trillion, or more than $25,000 for every person in Canada. This record is not something that the present government should be confident it could be re-elected on. It is, in fact, a disgrace and embarrassment. And it is an expense the government would not have felt necessary had it not pursued its failed lockdown policy, which needlessly hobbled the economy.
Traditionally, in political campaigns, the greatest damage is done by the clever use of ridicule. In the 1936 Quebec provincial election, Maurice Duplessis — who had just founded the Union Nationale, a coalition of liberal reformers, conservatives and nationalists — discovered through his interrogations at the public accounts committee that Irénée Vautrin, one of the ministers of the provincial Liberal government that had been in office for 39 years, had charged $5 to the province for the acquisition of a pair of breeches. His position required him to visit rural development and construction sites and it was not a particularly unreasonable acquisition or a material amount. But suddenly there were demonstrations all over Quebec, in which people held up ragged breeches on poles and placards demanding compensation for, or the return of, what became instantly infamous as “Les Culottes de Vautrin,” as if the taxpayers were paying for his underwear. In 1944, U.S. President Franklin D. Roosevelt, running for a fourth term, had discovered that a Republican congressional candidate had accused him of leaving his dog behind in the Aleutian Islands and sending a destroyer back to find him at the cost of many millions of dollars. He remarked that his dog “is a Scotty,” and that when he heard this whopper, “his Scots’ soul was furious,” and hammed this up for a while. Roosevelt’s opponent, Thomas E. Dewey, spent the next several weeks running against the incumbent’s dog.
Unless the federal Conservative party’s strategists have determined to hold their fire until the Liberals call an election before pointing out the colossal failure of the government’s vaccination policy, which would mean that they have made one of history’s all-time greatest displays of tactical political incompetence in order to inflate their opponents’ complacency, the Canadian media should be rippling all the time with absurd and demeaning comparisons between the vaccination performance of this country and Seychelles, Monaco, San Marino and Saint Helena, where Napoleon died and which has only had an international airport for several years and enjoys more than six times as high a vaccination rate as Canada. Barring the preparation of such an ambush, the Conservatives are somnambulating toward one of their greatest political self-immolations. Instead of trying to get votes from the Quebec separatists by effectively banishing the English language from the workplaces of Quebec, as Conservative Leader Erin O’toole did in one flippant French sentence during his Conservative conference speech on Feb. 26, they should be hammering this government for its failures and presenting some new policy ideas.
For three weeks, I’ve been promising to make some policy suggestions and last week I lamented that the Conservatives’ jobs plan consisted of a few platitudes, an improved national suicide hotline and a completely imprecise promise to restore a balanced budget in 10 years, something we managed for 14 years in a row under prime ministers Jean Chrétien, Paul Martin and Stephen Harper, and which could be restored in one year if we stopped this idiotic lockdown and showed a little imagination.
First, we should eliminate the lower ranges of personal income tax altogether, and lower the other rates, and replace the lost revenue with an increase in the GST on elective spending. If done sensibly, this would sharply increase revenues and drastically reduce the cost of collecting taxes, since high personal income tax rates drive those with high incomes to a perverse determination to reduce their income tax. Someone taking some friends out for a $500 dinner will not really mind if it costs $700. The country has paid quite enough for Harper’s fantasy that if we just kept a collar on the GST, we would keep public-sector spending in check. He cannot be blamed for not foreseeing this regime’s cavalier attitude to deficits.
The federal government should join with one of the provinces in setting up a virtual stock exchange and a securities commission that could monitor truthfulness in public offerings and filings, prosecute transgressions and facilitate the movement of capital into this country. We should not be so restrictive on incoming capital, and should only seize or reject it where courts of jurisdictions that Canada considers to be as thorough and fair as our own have determined that there are ill-gotten gains. We are not the world’s financial enforcer and the Ontario Securities Commission is now basically a shakedown operation infested with meddlesome hypocrites.
We should lead the world back to hard currencies. Now they are all losing value, are defined only in terms of other currencies, and the inflation yardstick is increasingly unrepresentative of the real cost of living, especially in the United States, where the cost of cars and housing are not counted. John Maynard Keynes was correct that the gold standard is an anachronism that’s too easily manipulated, but if we backed our currency with a composite yardstick of gold, essential consumer costs and oil (and ended our war against the energy industry), and believably promised to maintain a stable currency, the world’s deposits in our institutions would skyrocket. We would graduate almost overnight from the obscurity we have richly earned as stragglers in worldwide herd-profligate spending and constant devaluation, and money would flood into this country. We have not had an original fiscal or monetary thought in Canada since the housing bubble burst in 2008. We are on a treadmill to oblivion and if the official Opposition does not produce an alternate path, we will reach our destination. (To be continued.)
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