More advice worth ignoring but a lot worth considering

Way back, almost five months ago, I said that the media is full of advice for Conservatives and most of it is useless.

Some of that bad advice is, in fact, downright dangerous … consider, for example, just the one bit in this article in the C2C Journal that says “Fiscal conservatives need to get over their C2CJournal-Fall2015-COVER-560-FINAL_2obsession with balanced budgets, eliminating deficits and paying down debt. Without fail, over many decades, at every level of government, Canadians have sold their votes to the highest bidders. They only ever embrace fiscal conservatism temporarily, to be jettisoned as quickly as possible when a crisis passes. Preaching and practicing fiscal restraint for its own sake is pointless when you know your opponent is going to defeat you by calling you a tight-fisted meanie and promising caviar in every pot. And then spending every nickel of budget surplus or borrowing room you created.” Now the facts, that “Canadians have sold their votes to the highest bidders,” and  “They only ever embrace fiscal conservatism temporarily,” are undeniable, but if, from those facts, one draws the conclusion that 37274_2Conservatives should embrace the political equivalent of Dr. Strangelove and, to paraphrase, “stop worrying and love the debt” is a recipe for the destruction of the Conservative Party of Canada. Some may remember that, by about 1985, the old Progressive Conservatives looked more and more and more like Liberals who just happened to believe in a principled foreign policy (against apartheid) and in free trade. Look what that got us … Prime Minister Brian Mulroney took some of the hard decisions but then left it to Prime Ministers Jean Chrétien and Paul Martin to finish the job (by shifting burdens rather than solving the spending problem) and reap the rewards of history.

budget

I am happy to concede that fiscal responsibility is a hard, nearly impossible, sell until the Liberal elites have made it a necessity due to their propensity for reckless social spending. We need to recognize that the Laurentian Elites were weakened by Prime Minister Stephen Harper but they were far from destroyed. They still live …

… here and here …

… and they still work …

… here, and the centres of Big business, Big labour and the Big banks, etc.

The generally Liberal Laurentian Elites now have who and what they want in power. Their Big Interests are safe in the hands of the Justin Trudeau government.

What are not safe are the real  vital interests of most ordinary, hard working, middle class Canadians. The values and the economic security and, indeed, the future of Main Street and the working family are at risk …

… what suits the many and sundry special interests, each of which finds support in the elites, and that, together, are enough to elect a majority government, does not, necessarily, fit the needs of  the real “middle class:” working families living in rural areas, in small towns and cities and, especially, in the suburbs around larger cities like Vancouver, Edmonton and Calgary, Winnipeg, Toronto ~ the entire “golden horseshoe” ~ Montreal and Halifax.

But we need to read Mr Hodgson’s whole article with care … especially this bit:

Campaigning on taking money away from people or most programs is a recipe for failure. When it comes to public spending, never promise anything less than spending increases at the rate of inflation plus population growth. Widespread spending cuts, or even mere freezes, will inevitably be reframed by your opponents as an attack on the public good. This puts fiscal conservatives forever on the defense and forsakes the votes of everyone who works in or is directly or indirectly dependent on government.

Milton Friedman’s “starve the beast” strategy needs to be modified. History has shown that the beast (government) can’t be starved, but it can be put on a diet. Instead of railing about government obesity, highlight the virtues of fiscal fitness. Just cutting government spending by 15 minutes a day can make the body politic healthier and happier.

If deficits are inevitable they may as well be directed toward conservative purposes. Tax cuts fit the bill, as conservatives of all stripes believe keeping more earned wealth encourages independence, hard work, and individualism. Perhaps arresting Canada’s demographic decline with more generous baby bonus cheques would be advisable. The late Harper government made some moves in both these directions. Had it doubled down on them in the 2015 campaign platform, they might still be in power. Government money would also be well spent adapting and expanding British Prime Minister David Cameron’s Big Society platform. Ditto for new war ships and fighter jets. And every one percent cut in the GST is surely worth at least its weight in popular vote share.

There are plenty of conservative-minded policies or projects to spend money on, but the exact items are only important in that they effectively conservatize deficit spending. Better to run deficits for tax cuts now rather than wait for future left-wing governments to run deficits for dubious green schemes or Soviet-styled day-care programs.

Jeff Hodgson is right on two counts:

  1. “The desire for more is a constant and primal characteristic of the human condition. Human beings are hard-wired for ambition, acquisition, and prosperity – though not necessarily in that order – and this is reflected more than ever in the post-industrial, consumer-driven society we’re living in. Mortgages, car loans and multiple credit cards are the financial fabric of everyday life. Most people think this way of life isn’t too bad…perhaps even quite good! So why shouldn’t their politics reflect this?” and, therefore “… most Canadians, in most circumstances, will vote for political parties that offer them the most. They will continue to vote for these political parties whether their promises are affordable or not;” and
  2. Conservatives of all stripes need to stop functioning as the parsimonious scolds of the political world and build a more ambitious and salable 21st century fiscal conservatism. They can do this by offering voters lower taxes, targeted spending increases and a promise not to cut anything.

He is not proposing a Dr. Strangelove scenario; instead he proposes that the Conservatives should adopt policies that will both:

  1. Win election; and
  2. Minimize the fiscal damage to Canada.

Even though I, personally, am a fiscal hawk and would love to roll back a lot of what Pierre Trudeau did and what Justin Trudeau is doing, I’m also a realist and I’m with Mr Hodgson part way … maybe even most of the way.

His recipe is:

  • Stop proposing spending cuts or even freezes; in other words, Brian Mulroney was right and social programmes are, indeed, “sacred trusts” that must be maintained; and
  • ethics6Spend smarter … make the “body politics” more “fit,” by focusing spending on programmes and projects that are of real, meaningful benefit to most Canadians ~ something akin to my (actually Jeremy Bentham’s and John Stuart Mill’s) most often misunderstood utilitarianism, again: the greatest good for the greatest number. We, Conservatives, should want to do what is better for the majority most of the time, but, to do that we need to be in power so we need to temper our own preferences with what is needed to achieve and hold political power.

While I agree that another cut to the GST will earn votes, I am, personally, torn. I like consumption taxes because they are, in a way, optional: one can pay less in tax by consuming less. I dislike income taxes because, in my opinion, they take good money ~ which can be saved and invested ~ out of the hands of “ordinary Canadians” and give it to governments to waste. So, in general, I would prefer to have more (higher) consumption taxes at the expense of fewer (lower) income taxes, but, equally, I recognize that Canadians hate the HST/GST ~ possibly because they see it every day, while they are less opposed (just more accustomed to?) to the income tax ~ which they worry about only for a few days or even weeks each spring. Further, because Canadians hate the HST/GST, cuts to it, which earn votes, are, as Prime Minister Justin Trudeau and Finance Minister Bill Morneau just demonstrated, hard to reverse, so their impact is to constrain all government spending, which is a good thing.

Mark_Rutte-6

Singapore's Prime Minister Lee Hsien Loong speaks during a news conference at the Prime Minister's office in Putrajaya

As Jeff Hodgson suggests, we need to look at other, successful, “Conservative” governments and leaders for political models that are able to balance Conservative fiscal and social policy principles with electoral success. That means we must look away from the American winner-take-all model, which seems to be growing stronger and stronger as the political divisions in America deepen and expand, and accept that many Canadians want and like an activist, engaged government that provides service to them. One thing we have to look at is how those successful Conservatives manage … and that includes managing downloadthe 800 pound gorilla that is the Canada Health Act.

Until a national government can find the courage to repeal ~ significantly amend ~ the Canada Health Act so that the principle of “single payer” (taxpayer) funding is eliminated, provincial governments will continue to fail to upgrade education or even maintain the sinews and arteries of prosperity because health care budgets will grow and Grow and GROW, inexorably, and taxes can only grow a little bit more before Canadians say “enough” … thus, “free” health care funding will, eventually, bankrupt us all. When a Conservative leader finds the right formula to “sell” a new, improved Canada Health Act that gives many Canadians more choices for better health care services at only modestly higher costs then (s)he will have put the country on the right (Conservative) path.

imageUntil we solve the dilemma of how to pay for the biggest and most popular of the “sacred trusts” we cannot afford to even bother with e.g. our national defence or research and development or foreign aids or any of the other priorities that Conservatives might have. Paying for health care will be, in my opinion, the dominant political imperative by the second quarter of the 21st century.

So, let us not become pale imitations of free-spending Liberals, let us, rather, adapt our policies to the electoral (democratic) realities and refocus spending on areas that matter more. Some advice should be ignored, but some should be read, fully and carefully, and then taken to heart.

 

 

6 thoughts on “More advice worth ignoring but a lot worth considering”

  1. Nice assessment Ted.
    Demographics are certainly going to set the agenda soon.
    I suspect a lot will change over the course of the next ten years.
    We need to be thinking bigger and bolder.
    Jeff Hodgson

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