Tuesday, January 27, 2009

Budget Time

It's really too bad that the budget, unlike the Throne Speech, is no good to drink to. Because after hearing about the latest budget, some of us might want a stiff one. In case you haven't heard, here are the highlights:
  • $85B deficit over five years
  • $20B personal tax cuts and $2B business tax cuts over six years
  • $12B for infrastructure, including $1B for "green" infrastructure and $1B for clean energy
  • Extended EI
  • $8.3B for skills and training
  • $2.7B loans to the auto industry

At first glance, it doesn't look so bad, if not surprisingly un-conservative. Jim Flaherty, luckily, was ready to ease the minds of those who might be confused.
JOURNALIST: It doesn't look like a very conservative budget, does it?
JIM FLAHERTY: Heh heh ... well ... you know ...

I'm not sure if that sounds like incompetence, or if that's really all there is to say at this point.

So what can we really expect from this budget? Well, it's a recession budget, that's inevitable, what with us all shitting our pants like it's 1929. The Minister of Finance was clearly keeping this in mind, as you can see that the first point is the -- wait, I'm going to put in the zeroes this time, just so you can see how many there are -- $85 000 000 000 deficit, because if there is one thing that this recession has taught us, it's that you can't go wrong spending money that you do not have.

Okay, okay, let's give the Tories the benefit of the doubt. You've got to spend money to create money, right? The $20B in personal tax cuts are targeted at the lower tax brackets, which is good, because it means that those of us who exist on a grand total of $10,000 per year (plus tuition fees) will still be able to afford no-name peanut butter for our sandwiches, despite possible economic hardships.
(Okay, I'm exaggerating. Kind of.)

$12B for infrastructure sounds pretty good too. Since basically the agricultural revolution, good infrastructure has been loosely connected to a good economy. You create jobs for people to design, build, run, and maintain said infrastructure itself, and the people who make stuff can take it to places where other people are waiting to buy it. In a more modern sense, you can take yourself from wherever you live to wherever you are employed on a daily basis. Sounds simple enough. Money for infrastructure = good! Oh, but federal funds are rarely anything resembling simple. Toronto mayor David Miller may be biased, sure, but he may also be kind of an expert on the subject. And his most recent press conference suggests that he is concerned that cities will have to jump through hoops of red tape in order to see any of that $12B -- if they do.

Extended EI and skills and training also sound good for a recession. After all, when the auto plant tells you not to bother coming in on Monday, you're going to need to learn to do something slightly more recession-proof, and you're still going to need to feed your self/family in the meantime. If you really want to, you could even go back and be a student, which is to some extent recession-proof. Remember, if you default on your student loan, the bank can't foreclose on your brain.

And medicine is a recession-proof field!

Finally, the auto industry money. At first, I was in favour of the whole auto bailout thing. My shameful secret is that my family is from the Niagara region, where the auto industry is kind of a big deal. The shame I feel at being so connected to St. Catharines is an indirect result of the GM plant there laying off basically everyone, thereby killing the economy, and everything good and beautiful in the city, and if there is one thing that terrifies me, it is the idea of living in a city like St. Catharines. So do I want auto plants across Canada to shut their doors, putting countless cities at risk of turning into St. Catharines?
We've got to fight economic collapse at every turn! Economic prosperity or death, my friends!

Then, I saw this photograph.

What are all those tiny white dots on that massive asphalt strip? Those, my friends, are unsold cars being stored until such time as the dealer requests them. This is not standard procedure. The auto companies have simply manufactured far more cars than they can sell. And the best part is, they are still making more. Therefore, I would like to propose that, in line with the principles of common sense, we stop making shit that no one can buy. Let's turn the auto assembly plants into auto disassembly plants, and salvage what we can from these beasts to make something useful. Now there's a long-term economic strategy.

To wrap up this budget-related rant, so what if it isn't a very conservative budget. It's not perfect, but it's the first indication we've had that the Tories might be willing to stop being jerks and play nice in the House. Layton may be shouting "Shame!" but that's just what he does. For heaven's sake, a 143-seat minority who is willing to co-operate is far, far preferable to an expensive and unwanted snap election, or even an unsteady, divisive coalition (although admittedly less thrilling). Would I personally prefer a conservative government? No. Do I think that it's the best thing for Canada right now? Heh heh ... well ... you know.


William Matheson said...

The auto companies have simply manufactured far more cars than they can sell. And the best part is, they are still making more. Therefore, I would like to propose that, in line with the principles of common sense, we stop making shit that no one can buy.

Tell it! In fact, I really don't see the need for all the government intervention! The markets need to reset, need to correct themselves! The inefficient companies ought to just play musical chairs and vanish - or, if they can, get their act together.

I hate that we're being told that saving money is bad and spending lots and lots of money is good. It's a bunch of baloney from people who want to keep the party going and see if the snake eating its own tail can circle around back to its head.

Vincent said...

It's surprising but most people are indifferent to tax cuts. They would prefer the government to be working on creating jobs for the future.

Reb said...

Since when are people indifferent to tax cuts? Getting a random government cheque is like Christmas and Thanksgiving put together!

Vincent said...

I don't know. I haven't met a single person who was strongly in favour or in disagreement with the cuts.

Anyways, they are pretty useless as they stand.

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