Friday, July 11, 2014

The Moody Blues

No sooner had the newly elected Kathleen Wynne tabled her budget than Moody's -- the bond rating agency -- pounced. But, Linda McQuaig writes, it wasn't much of a pounce:

In fact, Moody’s only tweaked things slightly — it maintained Ontario’s perfectly acceptable current rating (Aa2), but downgraded the outlook from stable to negative – not a huge change, and one that didn’t even lead to higher interest on Ontario bonds.

Conservatives, however, jumped all over the news:

“It’s a very big deal,” solemnly cautioned Stockwell Day, former Conservative finance minister, on CBC-TV’s Power and Politics. “It should be taken very seriously.”

The National Post’s John Ivison dismissed as “baloney” the Ontario Finance Minister Charles Sousa’s suggestion that Ontario has a revenue problem.

“It’s not a revenue problem. It’s a spending problem,” thundered Ivison in his broad Scottish accent, sounding like a Dickensian character responding to the request “please sir I want some more.”

For conservative pundits, there is no such word as "investment." Everything comes down to spending. They make no distinction between wise spending and foolish spending -- even though a good case can be made that our present masters do spend foolishly, on things like F35's and advertising. Their ranting about spending is a smokescreen to hide their real objective -- to downsize government to the point where they can, in Grover Norquist's words, "drown it in a bathtub:"

The Harper government, deeply committed to this ideology, has followed the formula closely. It has slashed taxes to the point that Ottawa now collects less revenue (as a proportion of GDP) than it did in 1940 – before we had national public programs for health care, pensions and unemployment insurance.

With such reduced revenue, the government insists it has no choice but to cut spending. Got to get those deficits down, Moody’s is coming, etc.

As a result of Harper’s spending cuts, Ottawa is projected to spend only 14 percent of GDP by 2018/19 – the lowest level of spending by Ottawa in seventy years ago.

The problem is that all this downsizing has been going on during the biggest economic downturn since the Great Depression. Conservatives have completely ignored the lessons that tragedy taught us.

 The only thing they know how to do is sing the Moody Blues.


UU4077 said...

If the Prime Minister of Canada can't be bothered to ever meet with the provincial Premiers then the feds need to keep their noses out of provincial issues.

Owen Gray said...

If they were consistent, UU, they'd follow that policy. But they live in fear of anyone -- or any government -- that doesn't see the world as they do.

AsAskingtherightquestions said...

It wil be really interesting Owen, to see how our "great economic manager" explains the pitiful job numbers posted today. He and Oliver (and Flaherty!?) will have lots of 'splainin' to do since they have continued to cut federal jobs and hold back federal funds so that they can BALANCE the budget for the upcoming election, in the face of continued unemployment and reduced demand in the economy. This is not rocket science! Bad economic theory practiced as ideology -when will the opposition grab this and start punishing Harper on the only area he still has (somehow) managed to convince people he is competent in? He is no economist.

Owen Gray said...

I agree, Asking, he's no economist. You 'd think the numbers would offer people the proof they need to understand that he is not who he claims to be.

But flim flam men are good at what they do.