The Ford government introduced its first budget yesterday. It's interesting to look at figures for the budget deficit -- which Ford claimed had put us on the road to Armageddon. Martin Regg Cohn writes:
At budget time a year ago, the Liberal government of the day announced a deficit of $6.7 billion for the 2018-19 fiscal year. In her pre-election report weeks later, the auditor general said it was $11.7 billion (partly because of an accounting dispute over the value of government assets from a pension surplus). A month later, the independent Financial Accountability Office pegged it at $12 billion.
Yet upon taking power, the Tories insisted even those higher numbers were still too low, claiming last September that the true deficit was $15 billion. But in February, miraculously, Fedeli claimed credit for bringing it back down to $13.5 billion, followed by Thursday’s budgetary boast of $11.7 billion — bringing us full circle to what the auditor predicted a year ago.
And that carbon tax -- which would be a job killer?
Despite the budget’s doomsday rhetoric about a “clear and present danger” from the carbon tax, Fedeli confirms the economy will in fact continue to grow, not shrink, as the premier claimed. The unemployment rate, which has been tracking downwards since long before the Ford-Fedeli Tories took power last year, will remain at record lows.
Turns out there will be more job-hiring than job-killing despite the killer tax.
Instead, Ontario’s economy will grow by 1.4 per cent in 2019, according to Fedeli’s budget. Even that positive number dramatically understates the consensus among the top 13 private sector forecasters consulted by the Finance Ministry, whose prediction averaged a more robust 1.8 per cent.
Interestingly, when Fedeli issued his fall economic statement in November, he predicted economic growth for 2019 would in fact be 1.8 per cent — precisely the private sector forecast Ontario is now ignoring. Either way — whether you trust real-world economists or the government’s own downsized prognosticators — that’s a world away from a provincial recession (defined as two consecutive quarters of negative growth).
Somebody's blowing smoke.
Image: GQ Videos
4 comments:
The auditor general was wrong about the pension accounting. Even the society of actuaries said so.
Regardless, I do not understand why both the Conservatives and Liberals constantly rule out raising taxes on big business. A 1% increase would go a long way to reducing or eliminating any deficit. The companies are not going to leave over 1%. Companies still do business in Europe where taxes are higher.
UU
Business pays the bills for political parties, UU. The parties won't bite the hand that feeds them.
In these difficult times, Owen, I take a measure of comfort in the fact that Regg Cohn is keeping very close tabs on these guys. The rest, of course, is up to us, the electorate.
Regg Cohn knows exactly who these folks are, Lorne. The question is: How many Ontarians have figured out what he knows.
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