Saturday, September 26, 2015

Quick summary of the Liberal 4-year Plan



So what is in the Liberal spending plan?

You can find the plan itself at this site. The plan is well-written, with a clear explanation of the principles that underlie it, a good layout of the major expenditure and revenue items, and a comparison of the different governance values that drive the Liberal plan with those drivers of the NDP and Conservative plans.

This Liberal plan is not full of holes like a Swiss cheese, as Mulcair’s skimpy plan has been so properly described.

The Big Picture – the annual $400 billion federal budget:

To put things in perspective, just how much does the federal government spend each year, through out of pocket cash payments and forgiveness of taxes that would normally be paid (these are called tax expenditures and arise from tax shelters to some taxpayers)?

The annual federal government expenditures each year total some $300 billion, which rises to $400 billion if we include $100 billion of “tax expenditures” (that is, tax shelters or tax writeoffs under our current tax laws).

When you read about the Liberal plan for extra funding, and the planned budget deficits in the first three or so years, bear in mind that the total federal expenditures over those four years, at $400 a year, are some $1,600 million. We are not by any stretch of the imagination talking about a Liberal plan that increases the government spending by 10% or 20% of that total.

Shutting tax loopholes that favour the richest:


The Liberals will check all such tax loopholes with a view to reducing those “with the core objective being to look for opportunities to reduce tax benefits that unfairly help those with individual incomes in excess of $200,000 per year.”

Summary of Liberal plan:

So what are the Liberals proposing?

Their plan shifts some spending from mostly child care payments under the Conservative programs, to new child care and other programs of the Liberals; invests some $17 billion in infrastructure; and includes the promise to make the tax system more transparent and honest by having party projections policed by the Parliamentary auditor.

Here is a summary of the major differences with the NDP and Conservative plans:




And here is the Liberal undertaking to make all future plans by the government and by political parties transparent and honest:



and:




And here are some reviews of the Liberal plan:



The Details of the Liberal Plan:

It includes new spending (including mostly a re-allocation of existing child care spending) of $147 billion over the next four years.

Total new investments of $147 billion over the next 4 years includes the "net" cost of new measures not yet announced of some $7.5 billion; and $106 billion (76% of the total) of Tax cuts and benefits.

However, 70% ($74 billion) of those tax cuts and benefits will be funded by scrapping existing child care programs put in place by the Conservatives. This $74 billion therefore means changing the money spent by the Tories on their slice and dice programs, to new programs to be implemented by the Liberals, aimed at those who really need the help.

Some 12% or $17 billion of the new investment will consist of infrastructure spending (part of the ten year $125 billion infrastructure spending action plan the Liberals announced earlier on, that has met with such approval from voters).

The Conservative attack on the Liberal plan:

The rapid Conservative attack seems to be focused on the $7.5 billion of net cost of new measures not yet announced: they claim that there is a shortfall of $6.5 billion that the Liberals will have to meet by raising taxes on the middle class and seniors.   

The Conservative attack seems to me to be hastily prepared, and premised on one thought: If we can repeat There’s a hole in the bucket enough times, then voters might think in terms of our framing and shoot down the Liberal Party plan. 

That attack is amateurish, and leaves Harper determined to die on the hill of No more taxes and I am the best man for the job while the other two guys are really more scary and more imperfect than I am campaign plan.

Come October 19, voters will determine whether to vote for absentee management of the country, or for hope.


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