Economics at play. | Photo courtesy of the Prime Minister’s Office
Would you say that you are financially better off today than two years ago? If your answer is maybe yes and maybe no (which would make you the same as many of your fellow Canadians, who think that improvements could be made) you are exactly what Stephen Harper’s Conservatives are looking for in a voter. So convinced are they that the economy will continue to be the main theme in the upcoming months that they are refraining from presenting too rosy a picture, keeping in mind the 2008 economic crisis.
They are accordingly playing a careful hand when it comes to the economy and showing moderate optimism. This is because, warranted or not, Stephen Harper’s Conservatives still have the upper hand on their opponents in matters of the economy. Canadians aren’t exactly giving the government straight As, but they do consider it to be the safest bet. In fact, when it comes to judging who to entrust with the proper management of the economy, an obvious option isn’t clear. A cynic might say it is more a matter of making the least worst choice among the parties.
Last week’s federal budget announcements are in a way quite clever in presenting fiscal prudence, considering that most people believe that this is the way to go. Consequently – and precisely – because many Canadians are still somewhat unsure of Canadian economic performance, opposition parties will have to tread carefully and must make sure not to oversell proposals to counteract the government’s budget measures.
As far as the Conservatives are concerned, this budget shows the way towards fiscal balance by 2015–2016. It is a goal that the Harper government cannot afford to not attain. No matter what it takes, this government will not propose anything else but a comfortable budget surplus next year. Because, as we know, apart from its stance on law and order and its tougher-than-nails attitude towards criminals, the Conservative party knows full well that the conservative electorate tends to put balanced budgets at the centre of its economic beliefs.
On this matter they are quite vulnerable. Since becoming the government, the Conservatives have put forward more budgets with a deficit than balanced ones. This explains their quasi-obsessive quest for a balanced budget before the next general elections. True, they had to deal with the 2008 economic crisis but they are in part responsible for their own misery since they opted, in their very first budget in 2006, to reduce the Goods and Services Tax.
Another reason for Jim Flaherty, current Finance Minister, to produce a comfortable surplus budget next year is that most likely the 2015 budget will be his last. I just can’t see him running in the next federal elections. He will most likely want his last budget to be similar to his first: one with a surplus.
