Liberals roll the dice with ambitious budget

The Trudeau government is praying it rolled sevens on budget day. Its first budget was a political crapshoot the likes of which Canadians have not seen since the Mulroney and Chrétien eras. It was those prime ministers who last made big political wagers on major tax reform and later big program cuts.

For the past 10 years, Canada has been led by a Louis St. Laurent-like, riskaverse, small-change government. Oh, the political rhetoric was loud and bold. But Stephen Harper made it part of his political brand that he opposed big ideas and, God forbid, big gambles. His was, in practice if not in rhetoric, in action if not in tone, a rather timid style of government.

Much was promised about shrinking government, but in fact program spending rose faster under him than under his predecessors. Much was promised about defence spending, “economic action” and pipeline construction. Delivery was somewhat more modest.

Liberals have always been more moved by big projects and big change, and sometimes they have delivered. The Charter was a huge gamble. So was recognizing Communist China at the height of the Cold War. Trudeau père’s National Energy Program (NEP) was, however, precisely the sort of ham-fisted big project that Conservatives still hammer more than 30 years later as proof of the risks of “big government.”

The NEP well demonstrates the parallel gamble with big expenditures and big projects: the risk that they fail or enrage an important and powerful sector or both. Walter Gordon’s visionary economic nationalism budget two decades earlier enraged Bay. St and ended his career.

Trudeau is fortunate in that the Harper economic record can still be flailed with some credibility and that the Tories continue to peddle the fiscal fairy tale that rising expenditures, tax cuts and stable surpluses add up. The NDP is pushed back to a traditional opposition chant of ‘Too little, too late!” Though Thomas Mulcair seems set to be the biggest political beneficiary if the Liberals stumble in their execution, given his mastery of the House and political attack.

So what are the odds of political success? Perhaps even.

The new government has demonstrated its skill at political marketing, though its promotion of the budget narrative was a little wobbly and incoherent at times. (Growth is not stimulated by investment? Investment is not stimulus? Really? A silly distinction without a difference.)

It has chosen its narrative well: children and First Nations families are prominently in their shop window. It has stroked a broad array of powerful allies in the big provinces, the big cities, and in the big business community. Dropping the changes in capital gains, employee stock rewards, and corporate tax did open a vulnerability on the left. They clearly made the strategic gamble it would stuff the Conservative counter-attack more effectively, their priority in the near term. But. Deficit spending has a very mixed record as an economic driver, and comes with baggage that begins to accumulate quickly. The Bob Rae government in Ontario saw its fiscal hole simply widen inexorably, as may yet happen to Kathleen Wynne’s government pursuing a similar strategy. Public infrastructure projects that come in on time and on budget are as likely as a February daffodil on Parliament Hill.

Then there is the brutal challenge of expectations management. Failure to keep one’s supporters patient and supportive is always the No. 1 cause of political ruin for progressive governments everywhere.

The advantage of the Harper “small beer” approach to governance is there were few expectations to dash.

Expectations of social housing advocates, environmental campaigners, electoral reformers, First Nations leaders, transit boosters, university protectors, productivity gurus, free traders, among a much longer list of eager supplicants, have not been higher since 1968 — the euphoric launch of our first Trudeau government. (The parallels are eerie: the Le Dain Commission pulled back from launching legal hash brownies only at the last minute, under the first Trudeau.)

Canadian history offers lots of evidence that we prefer our leaders to “dream no little dreams” as Tommy Douglas liked to say. You don’t build railways, seaways and the most successful immigrant- integration experiment in the world without taking big gambles.

But as every hardened gambler knows, each roll of the dice is a flirtation with heartbreak and disaster. Political crapshoots carry even greater penalties — and payoffs — than those in the back alley.