Friday, August 28, 2015

Justin Trudeau, the King of Growth, leads with honesty

Mulcair took a dangerous step with his pledge not to go into deficit:

Despite the low price of oil and Monday’s tumultuous day on the markets, Mulcair said he does not foresee having to go into the red.

“We’re of course going to finish the fiscal year on Mr. Harper’s watch – 2015-16 is his budget, but our first budget will be a balanced budget,” he said, speaking at a small business that makes natural playground equipment.

“We know because we’ve got a lot of experienced people that governing is about priorities. Our priorities are not the same as Mr. Harper’s.”

Mulcair has not yet released the full costing details of his platform.

Why did Mulcair take this step?

The key is to understand that the soft underbelly of the socialist NDP is that many Canadians do not think of them as prudent managers of the economy. The voters generally think of the NDP as being on the wrong side of the wealth creation: wealth redistribution divide. They have policies which generally deal with redistributing wealth using the powers of the federal government with regards to cash taxation and non-tax donations (aka tax shelters), rather than on generating more wealth.

Tony Blair found the same problem confronting him when he took over the UK Labour Party. He realized that to gain power he needed to shift the Labour Party towards the centre, including expressly deleting from its constitution any references to nationalizing industries, and massively increasing personal taxes on the wealthy.

Tom Mulcair has not managed to move the NDP as far towards the centre as Blair managed, but he has done a few things in this area. He has consciously set out to nudge the party towards a growth party. The NDP constitution was amended, to remove some of the most offensive (to non-socialists) terms.

Mulcair has also deliberately staked out three positions in this election.

Mulcair framing as “safe” like Maggie Thatcher was:

Firstly, he has tried to frame himself as a man not to be feared by risk-averse middle class voters when it comes to managing the economy. He has deliberately referred to his positive views of Margaret Thatcher; in doing this, he has borrowed directly from Tony Blair’s song book. It is an attempt to link himself with the right wing, non-socialist British prime minister, who is a goddess in the eyes of many conservative voters in Canada.

How did Blair word his agreement with Thatcher? In A Journey My Political Life, he writes:

In what caused much jarring and tutting within the party, I even decided to own up to supporting changes Margaret Thatcher had made. I knew the credibility of the whole New Labour project rested on accepting that much of what she wanted to do in the 1980s was inevitable, a consequence not of ideology but of social and economic change. The way she did it was often very ideological, sometimes unnecessarily so, but that didn’t alter the basic fact: Britain needed the industrial and economic reforms of the Thatcher period. Saying this immediately opened the ears of many who had supported the Tories in that period – not because they were instinctively or emotionally Conservative, but because Labour had seemed so old-fashioned and out of touch with individual aspiration. Our economic policy had appeared hopelessly collectivist; our social policy born of political correctness.

Mulcair said this about Thatcher in 2013:

Mulcair’s tune had shifted dramatically by 2013, when he mourned the British leader’s death with a line seemingly ripped from an encyclopedia, “one of the most influential British politicians and world leaders of the 20th century.”

And in 2001 he had this to say:

Sitting in the Quebec Liberal caucus in 2001, now NDP Leader Thomas Mulcair had nothing but praise for Margaret Thatcher’s neoliberal agenda and right-wing politics.

In a clip circulating on social media Tuesday, Mulcair praises the former British prime minister for being a “wind of liberty and of liberalism in the markets” and making her country one of the most productive in all of Europe.

Mulcair framing as not a tax-and-spend socialist:

He has added to the NDP program a clear statement that he will not raise taxes on the wealthy, but will only raise corporate taxes. He has also hedged the corporate tax raise, soft pedaling the exacting amount to avoid creating too many negative headlines in the business press.

Mulcair framing as the man who will stick to the budget:

This is the most extraordinary leap across the creation:distribution divide that he has taken. He has sided with the Tory trite mantra of no budget deficits, as the quote above shows. No red ink for this leader of the pinkish party; all will be black ink for his first term in power.

It is right here that Mulcair has exposed his political jugular to the sharp knife of the Liberal Party. By trying to outdo Harper, with the Harper-lite no deficit pledge, Mulcair has sought to reassure the anxious votes in the vote-rich province of Ontario that having him as prime minister is a safe bet.

Until recently, the NDP has not run well in Ontario amongst the aspirational classes. Even Mulcair’s policy of reducing corporate taxes for small businesses, has not worked the wonders he needs to shift a sizeable chunk of middle class Ontario burghers’ votes to the NDP.

Of course, the risk he runs is that he will be derided just as Harper will be, because Harper talks one thing but does the other: anti-deficit for ideological reasons (Harper wants to shrink the federal government and drown it in the bath tub of insufficient tax funds), Harper has not balanced a budget in his time in office. The latest nonsense balancing is because of sleight of hand, as the press will prize open in the next two weeks. Remember, Harper is the man leading a government that has not spend a billion dollars budgeted for First Nations affairs!

Although Mulcair is trying to frame himself as the safe choice between the Deficit King Harper and the Austerity King Martin, he has foregone the role of Growth King.

That now rests on the brow of Trudeau, who will spend $125 billion of low cost funding to invest in three buckets of necessary infrastructure spending. And that stimulus is what most Canadians want to take place right now, according to the polls.

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