Those budget cuts, in full - Macleans.ca
 

Those budget cuts, in full


 
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My fellow pundits seem greatly impressed by the budget’s “austerity,” to judge by the headlines and commentary that appeared afterward. Here, then, in graphic form, is just how austere it was.

The chart on the left tracks program spending over the next several fiscal years as projected in the September 2009 fiscal update, in billions of dollars. On the right is the spending track contained in this week’s budget — that is, after the cuts that had everyone swooning.

No, you’re right: they’re practically identical.

MORE, MUCH MORE: And of course, spending in this “austerity” budget totals nearly $28-billion more over three years than in last year’s “stimulus” budget. Strange but true:

  • Spending in fiscal 2010, as of 2009 budget, $229.1-bil; as of 2010 budget, $237.8-bil.
  • Spending in fiscal 2011, as of 2009 budget, $236.5-bil; as of 2010 budget, $249.2-bil.
  • Spending in fiscal 2012, as of 2009 budget, $235.1-bil; as of 2010 budget, $241.4-bil.

Astonishing how easily the media is bamboozled. Every. Single. Year.


 
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Those budget cuts, in full

  1. I am not sure pundit's have been swooning over the cuts (our host of late has been a tad hyperbolic), but I think our host, who has commented before on PM Harper's incrementalism, is on to something.

    These graphs are graphic illustrations of that approach in action. As such they parry any Liberal counterattack of secret agenda, Harris-style slashing. PM Harper has learned the lesson from 2008 that very small cuts (like arts funding) can have a disproportionate negative impact politically. Mistakes can be expected, but Harper never makes the same mistake twice.

    Our host himself has predicted on At Issue panel that the next election will not be until 2012. And that year is when the downward trend in spending changes to slight upward on the graphs. If a majority government is won that year, it is probable that the downward trend in 2012 would continue downward, perhaps at a steeper rate. We shall see.

    • (Psssst. I'm not sure you want to mention Harris when you're talking about deficits.)

    • Nor does Harper ever admit to making mistakes – a form of arrogance that can grate the humble Canadian psyche

      • Nah, it just grates, humble or not.

      • I don't recall Chretien apologizing for adscam and after having been found guilty by judicial inquiry. Very seldom do PMs stand up and apologize as it gives ammunition to his opponents. So find another crticism to make there are so many according to Liberals.

    • Did you read Ibbitson's piece?

      • Ibbitson is thick in the skull. He is so desperate like the rest of the media to keep the prorogation thingy going. The fact is Harper is not stupid. He knew the detainee issue was not going away but he did know he could recalibrate the Senate and that was his intention. He also wanted to stop the aggressive media from developing headlines during the Olympics that would embarass the country. Have fun Andrew. Keep bitching.

  2. "Mistakes can be expected, but Harper never makes the same mistake twice."

    Maybe not exactly the same mistake, but he seems to make similar mistakes over and over again. Then there's the little matter of prorogation–which is coming close to becoming an annual holiday.

    • What mistakes has he made over and over again?

      The prorogations were not mistakes. The 2008 prorogation prevented the coalition from taking power without an election. The 2009 prorogation allowed him to gain immediate control over the Senate. Both prorogations were used to solidify and strengthen his political position.

      • "The prorogations were not mistakes. The 2008 prorogation prevented the coalition from taking power without an election."

        Which is not illegal under our constitution.

      • Some in the media have thick skulls where they want to develop a story line i.e. detainee issue caused prorogation and keep gnawing on it like a dog with a bone. Opponents of the government keep talking about process and how the Conservatives do politics. Not much talk about policy just process.

        Canadians see through this and that is why Harper's leadership numbers are twice as good as Iffys.

        • I'm truly very sad to report, hollinm, that the Liberals (and I think the NDP too, although I could be mistaken) set out very concrete policy proposals over "the break". I'm sad because they obviously weren't picked up by the media outlets you frequent, and I'm sad because Canadians don't seem to pay any attention to policy stuff, which is the only thing that can explain those polling numbers. Also how the government with the worst record on fiscal policies(undisputable–although you will try–facts on the ground) is seen as the best to handle our economy, according to the polls.

          • OH REALLY! Care to link these "concrete policy proposals" that the Liberals proposed? By all accounts Iggy went on holidays again!

          • http://www.liberal.ca/pdf/docs/ignatieff-open-let

            I don't know where your "all accounts" came from, but it sure wasn't reality. And now I know you're going to criticize and slag these proposals (I can't wait to find out if you'll do it blanket style or each one individually). So, have at it.

          • An open letter to Stephen Harper is the Liberal version of "concrete policy"? Try wraping it into another Red Book and present it to VOTERS as "concrete policy". Looks like another document that is like trying to nail jello to the wall complements of the Liberals!

          • Didn't see much coverage in the media Jenn. Probably because it was the same old, same old. Holding meetings is not a platform I hate to remind you. It is simply a gabfest. Action my friend action is all that counts. As well writing letters does not a platform make. In fact if Iffy keeps it up Canadians will quickly draw the conclusion that he can only write letters and has trouble putting his thoughts forward in a coherent, thoughtful and easily understood way by the masses. Oh I forgot he is a professor and letter writing is his forte. Maybe he can write letters to Harper on the campaign trail. What a dolt he is. You can defend him but I am afraid Canadians have made up their minds about him. He will never be PM.
            One other point instead of criticizing the deficit tell me what spending you would not have made i.e. let GM and Chryler close their plants in Canada or perhaps continuing to support the unemployed. Get real. You buddies would have spent even more.

          • Uh, yeah, which is why I wrote in my original post, "I'm sad because they obviously weren't picked up by the media outlets you frequent."

            But you crack me up, hollinm you really do. "Action my friend action is all that counts"

            First you want the Leader of the Opposition to tell the Prime Minister what to do now. Then, when the Leader of the Opposition sends over some suggestions, you declare that it isn't enough and he should IMPLEMENT them.

            Now, it may serve you in the future to understand that the Prime Minister is the one who's job it is to develop and implement plans, and generally run things. It is the job of the Leader of the Opposition to oppose said plans. He can, if he feels like it, suggest policy, but he doesn't have to any more than the Prime Minister has to accept said suggestions.

          • Jenn….just to let you know Stephen Harper is the PM. So he has the job. You guy wants the job and standing back and criticizing virtually anything and everything will not get him the job. So you can hide whatever lame, nanny state policies you think you have but the fact remains Iffy will have to come out with policies and he will have to cost them for the Canadian people before they will buy what usually is a pig in a poke when it comes to Liberal policies (the devil is always in the details).

            Once again writing letters is not policy. Anybody can write a letter and ask for this, that and the other thing. However, does Iffy think the PM is going to sit and read a 7 page letter. I don't think so. That's the problem with the Liberals. They have trouble focusing on a couple of issues. They are bereft of policy so they use a scatter gun approach. Everything is important. Oh, does that ever remind me of Mr. Dithers.

            You say it is the job of the PM to develop and implement plans. That is true. However, the official opposition needs to offer an alternative if it expects to win government. Iffy is failing this test badly and no gabfest at the end of March is going to solve that problem.

          • If the PM isn't going to sit and read a 7 page letter, why would he read several costed, detailed policy initiatives? I had occasion just the other day to look at one of those (for Liberals but that isn't what I'm getting at) and even though it was a small slice of an overall bigger issue/policy, it ran over 10 pages. It was also the beginning stage–more details and costing would come were it put into a bill.

            In addition, why would Ignatieff set out the full, detailed and costed plan, and then just give it to the guy for nothing? If Harper was interested in any of the suggestions put forth in the letter, perhaps they could have a conversation about same–you know, like adults–and perhaps at that point Ignatieff might show any further work done on specifics. But doing all the work so Harper can take all the credit would be . . . dumb.

  3. So over 5 years spending remains essentially flat – assuming an inflation rate of 2%, that's a 10% reduction in real spending. That is very impressive.

    • After jumping $30-billion in a single year! For God's sake get a grip.

      In actual fact spending is projected to grow by 3.6% per annum over the entire six-year period, 2009-1015, roughly twice the rate of inflation. That's from a base that in 2009 was already 25% higher in real per capita terms than in 2000. And it assumes future budgets do not simply tack on new spending on top of this track, as they always have in the past. See, for example, the addendum I have attached to the original post.

      • Valid points. However, aren't they projecting economic growth of over 5% for the next 4 years? So by the time the budget 2015 gets here federal spending as a percentage of GDP would be lower than the admittedly higher levels of today.

        Peering through the budget the best opportunity for cost savings is in health care. You could reduce the deficit by $20 billion right away by reducing health care transfers to the provinces, and then responding to their cries of being poor by amending the Canada Health Act to either means-test certain procedures by income, or delist services and let the market after additional insurance to people who want to cover themselves for the de-listed procedures. Politically impossible but other than stopping stimulus spending, reducing transfers to the provinces is probably the only immediate area of savings left.

      • So Andrew instead of sitting in the cheap seats and carping why don't you develop an alternative budget and tell Harper what to cut and what union jobs should go and what programs to cut and of course how to get the pesky opposition to agree. You need to use your head man. Do you think the Liberals would really cut spending? Think day care and carbon tax. There is only two alternatives. Would you rather the carpetbagger to start spending us to death? It is you that needs to get a grip man.

        • I dunno – seems to me that the last time the Liberals found themselves in a deficit situation, they cut pretty heavily. I will admit that they cut mainly bycutting transfer payments and letting the provinces do the dirty work, but still…

          The whole deficit spending wouldn't have been a problem if the Conservatives could have controlled themselves during the good times. I don't know that it is entirely fair to attack the Liberals as free spenders when the Cons inherited a surplus. In fact, have the Cons ever posted a higher surplus than the Libs did in their final budget (Goodale's)? If the answer to that is no, then I thik we have our answer about who are the bigger spenders.

          Oh, and if you want to look at things another way, total spending has increased under the Conservatives from $200 billion to $280 billion. And that is with teh benefit of debt reduction and lower interest rates driving down debt service. So how exacly do they get to call themselves the fiscal conservatives?

        • That is the stupidest response ever. Why doesn't the government do it's goddamn job.

    • No, flat would be from the 2008 levels, before stimulus spending kicked in. That stuff is supposed to be temporary, slowing this year and all but falling to zero through 2011. Taking out stimulus spending, it's growing well above the rate of inflation.

  4. If the target everybody has in mind is the deficit in 2015 (which was projected to be about 19 billion) then I'm not sure the difference should be dramatic, particularly when you graph everything on the scale presented here.

    • The change isn't enough to cover the gap though. Even on Coyne's scale, you're looking at savings of fractions of that $20 billion. Flaherty's budget pretty much admits this – the Conservatives are relying on revenue growth to balance the budget, not any real measure of austerity. That's assuming revenue will actually grow that fast, of course (not easy to do while still in the midst of cutting corporate taxes).

      I get the sense from Coyne that he's not upset so much about the budget deficit itself, but that the Conservatives are ignoring fiscal conservatism almost entirely – they're not making government smaller, they're not really balancing the budget in any reasonable time frame, so what's left?

      • By Coyne's standard every government since WWII other than Chretien's has been an utter failure. Yet we rarely see him cheer-lead for da little guy.

  5. Astonishing how easily the media is bamboozled.

    They're too busy looking for the part of the budget earmarked for torture and gay-bashing.

    • Nah. They were too busy getting dazzled by the bright shiny national-anthem thing. Conveniently withdrawn a few days later when no one cares about the budget anymore. Hook. Line. Sinker.

    • It's astonishing how easily the media is bamboozled in this country. So much ink is devoted to relatively minor stories that have no impact whatsoever on the lives of 99.9% of Canadians, but coverage of important things like federal budgets is considered boring and therefore unworthy of serious analysis.

      • What's more concerning is the cross-pollination in the media. Do programs like Power and Politics and Power Play with their media panels lead to a greater diversity of opinion, or convergence? Soon you find everyone sharing twits announcing the latest meme – jump aboard! What's wrong with the G&M laggards? etc. etc.

          • heh. I saw that article, then I saw it later twittered on a kdo'm tweet. As far as "certainly written by a Canadian" I often wonder that when the Economist prints something of substance about Canada that everyone fawns about. Often, I suspect (with justification) it is just some Canadian journalist freelancing that we wouldn't normally go gaga over.

          • You're right… most Economist articles about Canada are written by Canadian writers (the remainder are penned by snarky British writers), yet our parochial media likes to pretend that they represent "international opinion".

          • Perhaps because it is international opinion? The Economist has more influence and reach than any Canadian media, so it is the audience that is more important than the writer.

          • I also noticed that piece of trash masquerading as news.

            It said Mr. Latulippe “does not have the moral authority to lead an organization like Rights & Democracy” given his past statements about the potential for Muslim immigrants to breed homegrown terrorism, his support for capital punishment and his opposition to same-sex marriage.

            In other words, you have no moral authority if you're a conservative.

          • Apparently the rest of us are anti-semites.

          • Most of the rest are not anti-semites, in my opinion. A small and vocal number of those opposed to the activity in that organization are, which in my opinion is just a small percentage of the population.

          • You've really got that rant down, SCF – must be through repetition. I hear they're hiring over at Rights and Democracy, sounds like you would now fit in.

          • You call that a rant? And R/D is not my cup of tea.

    • For the media, that is what austerity looks like. An absence of an increase is austerity.

    • Get a life the only people that get bashed are the people who are not gay and those that support law and order and the trroops

  6. Andrew: Simpson and Travers, and Ibbitson were playing a bit of a shell game decrying the GST cut. You were against it because its bad economic policy. Fair enough. But They were against it because as they said at the time it "put the federal governments finances in a mess." After Ibbitson's column on the day of the budget, the real reason becomes clear: because it deprives the federal government of revenue for some of their pet projects as Ibbitson goes on to list in his piece. They don't care as much about the deficit as they imply, they are just chagrined that the money is going to places they don't approve of.

  7. It would probably be useful to post spending as a percentage of GDP for a few other (say G8) and/or Euro zone countries. Given the scope of the international financial train wreck. How does this budget stack up there? Since we are a trading nation does the soft demand in our traditional export markets get a mention? Do the truly staggering numbers of our social safety net black holes get a mention? Does the fact that a minority government, being excoriated by the usual suspects for "unconscionable spending cuts to our national social fabric" (money syphon to the maritimes and Quebec) get a pass?.

    Seriously Andrew, yer missin' mention of more than a few significant confounding variables. Are you advocating political suicide? What is your opinion of Joe Clark's political acumen?

  8. I for one would like to see much more fiscal conservatism out of the current budget.

    Except, Harper is running a minority government, with three opposition parties to the left of him.

    A good argument can be made that this budget, is a perfect reflection of the parliamentary will.

    And hence why the government cannot fall over it.

    • It is not wise to encourage Flarehty, when he was in ON as treasure he hurt a lot aof average Ontarians with his gold plated policies for the rich

  9. Most of the Canadian media doesn't do thorough research?! Shocking! Absolutely shocking!

  10. Andrew,

    Don't believe a word of it! If you read the Globe and Mail, they'll tell you. This is an AUSTERITY budget, full of FREEZES, and CUTS, and contemplations to SELL off PUBLIC assets. And if you don't buy that one, the Toronto Star has a similar bridge to sell.

  11. The anthem change was definitely used to distract us from things that are probably buried deep in there. I wonder what legislative items they have buried in the budget bill. Remember when they overhauled the immigration system using that vehicle a few years back and it took the media/opposition parties a few weeks to notice.

  12. Mr Coyne
    I certainly understand your point but what are the other possibilities? As an example do they cut deeper at DND or scrap the corporate tax cut to stay in power with the help of the NDP? The fact of the matter is this is the budget we will get as long as we continue to elect minority governments. Unless one party gets a majority this is they kind of half measures Canadians will get out of government.

    • But hey, Andrew would like to see Prop rep. That would further the possibilites of endless minority governments. With PR within ten years, we would have a possibility of 10 parties being respresented in the House. Does that sound like fun or what??

    • The other possibilities? How about the truth minus the spin?

  13. Mr. Coyne is Mr. Coyne. Personally, I'm goin' fishin' until the WSJ tells us we should invoke
    the Shock Doctrine.

    • Take up golfing and you too can fore-cast.

      • I dunno. My driver goes right. My irons go left.

        • Drive for show. Putt for d'Oh!

  14. I can't wait for the effect of the highly anticipated interest rate increases on our national debt! BTW, is that included in Flaherty's projections?

  15. It's no surprise to me that the Ottawa Citizen, the TorStar, and the GM are completely out in left field on this – that's exactly what I'd expect.

    What I don't get is what their game is. Do they really think it works to the CPC's disadvantage to have people thinking it's an "austere" budget? Are these organizations inept not only at journalism, but even at advancing their own preferred narrative?

  16. You don't know what their game is? Seriously. For them it would be the choice between Stop Harper or Anybody But Harper. They just can't decide,that's all.

  17. Darn right the budget is weak. But what do we expect? When Harper said last year that the economic downturn was nothing to get hysterical about.. Just about everyone laughed at him and told him he didn't understand how serious the economic downturn was.Then the attempted coaltion manouvre, then the stimulus spending.and so forth.
    I think it's rather strange that the media, Coyne included, didn't see it Harper's way when he at first didn't want to go overboard trying to correct the downturn, then when Harper was pushed into a corner by the hysteria crowd, and when he did implement the stimulus spending he gets criticised again. Now Harper doesn't push hard enough to clear up the deficit.

    Give your heads a shake. We all know that if the left/separatist coalition would have been put in place, the stimulus spending would have been much, much higher, and the following budget would not have looked as pretty as it does now.

    The media is anti Harper, no matter what he proposes. I wish for once that Harper would just do his own thing and wait where the chips may fall, politically speaking.

    • Here's a thought. What if Harper had admitted there was a recession looming during the election, and Flaherty had admitted we were in a recession at the time of the FU? What if they'd then said something to the effect of, "we will fight this recession by tightening our banking regulations we had allowed to loosen, and by ensuring the banking system can maintain enough credit facility, but we shall be very protective that the deficit we have incurred in 2008 does not balloon any larger in 2009 than can possibly be avoided."

      Perhaps that would have gone down a lot better than "what recession, there is no recession. We have a surplus." When it is painfully obvious that the course of action you have chosen is straight denial and lies, it is hard to deem that a credible response. That is why everybody laughed at him and that is why the attempted coalition maonevre. If they'd given an honest response instead of deciding now was the time to stick it to the opposition, we would never have had the whole mess. And that is on the Conservatives alone.

      • Obviously you don't understand leadership. Can you imagine Harper standing up there yelling a recession is coming, a recession is coming. That's the sure way to contract the economy faster that was necessary. It is the same reason the PM supports the military through action and deed. Can you imagine criticizing the military while the country is at war.
        You really need to think things through as part of the big picture rather than trying to score political points.
        I have to remind you that nobody knew what was in store during the election. Harper had no idea the U.S. was going to collapse, soften yes but not collapes as it did. He is good but not clairvoyant.

        • You aren't even trying to present anything close to facts.

          For example, "Lehman Brothers filed for Chapter 11 bankruptcy protection on September 15, 2008. The bankruptcy of Lehman Brothers is the largest bankruptcy filing in U.S. history with Lehman holding over $600 billion in assets."
          "AIG suffered from a liquidity crisis . . .The United States Federal Reserve Bank on September 16, 2008, created an $85 billion credit facility to enable the company to meet increased collateral obligations"
          "Two debates took place during the 2008 election. The French language debate was on October 1 from 8:00 to 10:00 p.m. EDT and was moderated by Stéphan Bureau. The English language debate was held the following evening, from 9:00 to 11:00 p.m. EDT, and was moderated by Steve Paikin. . . .The parties and the consortium later agreed to allot additional time to the economy because of the 2008 global economic crisis."
          " The 2008 Canadian federal election (more formally, the 40th Canadian General Election) was held on Tuesday, October 14, 2008"

          All quotes courtesy of Wikipedia.

    • ABSOLUTELY DEAD ON!!! The media get into a frenzy everytime Harper is mentioned. Next time Andrew is on the CBC he should bring a few napkins to wipe the froth from his mouth, it's so unbecoming!!

  18. It seems like you are the only one, Mr Coyne, who does the REAL math! What a snow job.

  19. I'm curious why this two month long break was even necessary. The Afghan detainee scandal hasn't gone away. Iaccaboci (sorry if I murdered his name) is going to rule, but we still have no answer as to the supremecy of parliament. Is a constitutional crisis looming?

    • Flanagan said he disagreed with prorogation but it was necessary because the opposition was doing harm to the Canadian Forces.

      The Government has neatly executed a judo move on the opposition, re-directing their attack energy into a unprofitable direction. The issue is no longer war crimes by Canadian troops but it is about the scope of Parliamentary privilege (the "Parliament will fight!" gambit).

      The appointment of retired Judge Iacobucci as an advisor (as opposed to a reference to the Supreme Court of Canada) is telling. He has never been a parliamentarian but had a long career in the Dept of Justice up to Deputy Minister before becoming a Supreme Court of Canada Judge. So what are the odds that his advice will be that Parliamentary privilege trumps the legal advice of Justice Department lawyers to not release information to Parliament under the Security of Information Act and the Canada Evidence Act? I'd guess not likely. The opposition is being deferential to Iacobucci now, but wait until he gives advice that they don't like.

      • I don't know if you are right but if the opposition isn't careful they are going to get a referral to the Supreme Court. It will take months even years to get an answer. Anyway it will be beyond the next election. A referral will end the ability of Parliament to get any answers because the government will stonewall and say it is in the hands of the Supremes.

        Asking for a public inquiry is a road to nowhere. Unless there is a smoking gun this is a waste of money. If Parliament thinks it has supremacy in receiving any and all documents it wants why didn't it request those documents about Maher Arar. They are treading on thin gruel and they may not like the answer.

        The judge knows the laws related to national security and privacy. So if he says the documents fall within those previews then the government will not release them and the opposition can continue to talk until they have nothing left to say.

    • If you were PM during the Olympics, wouldn't allegations of war-crimes and complicity in torture be just about the last thing you would want on the front pages? Sometimes timing is important.

  20. The media in Canada has been reduced to reprinting rephrased Conservative talking points. Lazy, stupid and partisan (present company and that of Wells excepted).

    • Repeating Conservative talking points? Iffy is now reduced to writing letters which the media kindly oblige by repeating them. There is enough shit to go around for everybody.

    • Conservative talking points? Iffy is reduced to writing letters which the media dutifully report on. There is enough to go around for everybody.

  21. One must realize the media in canada all believe they are smarter than any politician or Canadian in the country. They would be the ultimate politician as they answer to no one ,are not accountable for anything they write and the truth is only used when caught

    • Stop bogarting the crack-pipe, dude, and gimme my hit!

  22. This budget has been falsely characterized as an austerity budget while at the same time actually increasing spending for a very good reason which Andrew Coyne has either missed or purposely not mentioned. The reason has nothing to do with the economy and everything to do with ideology. The "austerity" label gives the Harper crowd cover to comb through the entire Federal bureaucracy to weed out anything and everything that has any negative impact on the conservative agenda that Harper doesn't talk about (an example is the Rights and Democracy organization). At the same time the actual increased spending allows Harper and his ministers to continue to travel the country buying votes using photo opportunities at openning ceremonies right up until the next election occurs.

  23. Andrew, can you plot previous estimations of the federal budgets alongside the present projections to give a sense the inverse austerity.

    It's sad how temporary spending became the new baseline in in one year.!

  24. Okay, it's the blanket diss!

    That's what I would have guessed.

    • OK, It's the Liberals policy of the day, subject to change if the polls blow in a different direction!

      That's what I would have guessed.