If there was any doubt about Harper’s motives in this spat with Ontario, they’ve certainly been answered over the last two days. There’s nothing wrong with the federal Finance Minister giving advice to his provincial counterparts since you can’t deny the Ontario and Canadian economies are interconnected. There’s probably even a time and place for making this advice public.
As for the validity of Flaherty’s argument?
But on Monday, Flaherty dismissed suggestions the province could not afford to cut spending arguing since he was finance minister of Ontario in a previous Conservative government, spending has increased 50 per cent.
“When the premier says he can’t control spending, or he can’t reduce spending I have a little trouble with that quite frankly given the skyrocketing spending over the past six years,” Flaherty said.
Well, Paul Wells does a pretty good job breaking it down and showing that things have gotten a lot better in Ontario since Flaherty stopped making the decisions there. I’d also wager that there isn’t a lot of nostalgia in Ontario for the good old Harris-Flaherty days, despite Jim’s belief that there will be protests in the street in support of corporate tax cuts.
It’s also somewhat baffling to me that the biggest spending finance minister in the history of Canada is the one urging Dwight Duncan to cut spending in favour of tax cuts.
In fairness, Flaherty may have a point that it’s important to call out a finance minister who was irresponsible enough to let spending increase by 12% over two years and has budgeted for it to keep rising despite an impending economic slowdown. But, as the numbers show, Flaherty won’t need to go very far to call that finance minister out. Here are the provincial and federal spending numbers (in Billions), using the last year before Flaherty came to Ottawa as the baseline:
……………..ONT/CAN
So, two years into the Flaherty era, federal spending has increased by 12.1%, a far cry from the “skyrocketing” 12.5% spending increase in Ontario over that time. Adding this year’s budget numbers gives Ontario a 12.8% increase compared to a frugal 14.6% increase in Ottawa. Projecting ahead to ’09/’10 and Ontario’s budget will have grown by 16.8% over the last four years, compared to 20.0% federally.
