The past two weeks have seen two budgets tabled. The first was the federal budget presented by Finance Minister Flaherty. The second was the provincial budget presented by Finance Minister de Jong.
Both could be described as boring, balanced budgets. Both are stay-the-course types of documents. The assumption is that everything is going smoothly, so why rock the boat?
Of course, this is based on the notion that everything is going smoothly which, I would argue, is only true for a minority of Canadians. A very small minority.
One of the things that Minister de Jong said in defending this year’s B.C. Budget is that any tax increases would not be fair to the taxpayers.
It is an interesting idea - the notion that the tax burden in British Columbia is onerous. In setting pretty much every budget for the past decade, finding a way to decrease the tax burden seems to have been the driving force.
But the question that I think should really be asked is: “Where has it got us?”
The answer would seem to be much more in debt and without the services that we need so much.
The provincial debt currently sits at $61.6 billion dollars. That is public debt - money that you and I owe because of decisions made by the governing B.C. Liberals. Many of those decisions I would agree with, but it is still a massive amount of debt.
It is predicted to grow this year and next with the debt reaching $68.9 billion in three years. Yet the government claims to have a surplus budget. How is it possible to claim a surplus at the same time as you are going deeper and deeper into debt?
It is a bit like someone saving $500 dollars and declaring that they are wealthy despite carrying $20,000 in credit card charges. Actually, in real numbers, it is closer to saving $56.63 while maxing out the credit card at $20,000.
The problem is that the budget does not have enough revenue to pay for the things that we want. So, the government borrows against the future to purchase the stuff that we need today.
Ironically, this is apparently acceptable practice for right wing governments as both the provincial and federal budgets seem to adopt the same approach. Shift the cost onto future generations so that we can say that we have a surplus today.
Consider that by the third year, Minister de Jong is predicting - that if all goes well - we will have a surplus of $451 million. At that level of surplus cash, it would take the government over 152 years to pay down the debt.
Hence, the government is eagerly anticipating revenue from LNG. Without it, there is little hope of tackling the mountain of cash that it owes. We will never have a truly balanced budget.
Equally interesting is that our debt has now been declared manageable because our debt-to-GDP ratio has finally dropped back to 18.5 per cent and is expected to decline to 17.8 per cent by 2016/17. In other words, it will finally be at the level that it was in the late 1990s. Yet, back then, everyone and their dog was screaming about how our debt was strangling our economy.
On the services side of the equation, we are being asked to pay more for medical services premiums. Not a tax increase, the government will say. But it sure looks like one as there is no way to avoid it and the money is intended to pay for health services.
We are also being asked to do without things that were once important. Education comes to mind. Class sizes are larger. Teachers are few and far between. Additional services and help are just not there.
We are not getting as high a quality product but, hey, we are paying less in taxes. Is this really a good thing? Don’t you get what you pay for?
Federally, it is pretty much the same. The debt payments are now easily the largest chunk of the budget. More money that is siphoned away from the program that you and I really on.
Everything from our military to research to employment assistance is under the strain of underfunding and overdoing. We simply don’t collect enough money to afford the services that we want and deserve. Personally, when I add up all the things that my tax dollars buy, I realize that I am still getting a pretty good bargain.
However, as services erode and funding is decreased, as debt climbs to higher and higher levels, and as wages do not keep up with the increased costs of government programs, I can’t help but wonder if a little more in taxes might not be a better answer.
Of course, that wouldn’t make for a boring, balanced budget.
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