The plan was to ensnare the opposition in an economic web from which they could not escape. Instead, Stephen Harper finds that his economic strategy has come a cropper. Scott Clark and Peter Devries write:
It didn’t have to be this way. Prime Minister Harper had an opportunity a year ago to set his government up to sail through any pre-election downturn in the economy while smelling like a rose.
He blew it. Here’s how:
Eliminating the deficit by 2015-16 was never based on any economic logic. It was always a political commitment, no more or less. And setting political targets for fiscal measures is a very dangerous game to get into. Fiscal measures move; political commitments can’t. Not without a cost.
The budgetary balance is the difference between two very large numbers: budgetary revenues and total expenses. Slight errors or shifts in either of these two numbers can have a large impact on the budgetary balance. All aspects of budgetary revenues and total expenses are influenced by economic developments over which the governments have little or no control.
Mr. Harper operates on the theory that he is a great man. And, therefore, he can bend history to his will. If he understood history a little better, he would be in better shape:
Instead of trying to force the global economy to operate according to their political timetable, the Harper government could have taken a victory lap in 2014-15. Then, when oil prices went south, they’d still have the credibility to say that the government’s overall fiscal picture remained sound. They could have held on to the contingency fund for debt reduction. Instead of publicly scrambling to respond to events completely beyond their control, they would have looked like the kind of canny fiscal managers who had a Plan B all along.
He got caught up in his own ego which -- Dr. Freud could have told him -- is a complicated web, indeed.