Jim Flaherty's lecture to Manulife caused the company to reverse its mortgage rate -- and it caused a kerfuffle in the Conservative chorus. Mad Max Bernier publicly disagreed with his cabinet colleague. Even Stephen Harper's favourite economist -- Jack Mintz -- says that mortgage rates are not Flaherty's business.
What Flaherty's intervention showed us is what we have known for a long time. The prime directive in the Harper government is, "Do As I Say." This is the government that has told native peoples that pipelines will cross their land. If they disagree, they will lose their federal funding. This is the government which has told the premiers what they will receive for health care, and which refuses to meet with the Council of the Federation to discuss it. And this is the government which lectures the rest of the world on how it should manage its finances.
The problem, of course, is that lecturers should practise what they preach. On that score, Andrew Coyne writes, Flaherty is no paragon of fiscal virtue:
But then, as long as we’re talking about bad credit: Is it not just a little galling, having to listen to lectures on the evils of too much debt, from the man responsible for adding $150-billion to the national mortgage?
But it's all part of a pattern. This is the government whose first piece of legislation was the Accountability Act -- and which has done everything in its power to avoid accountability -- from refusing to make spending plans public to proroguing parliament.
In the end, nobody believes anything a hypocrite says.
2 comments:
Some have said that Flaherty was conducting a rearguard attack on the attempt to reflate Canada' housing bubble. Too little and too late.
Personally, I can think of better ways to control speculators while simultaneously making home ownership more affordable for ordinary Canadians.
And, be careful about embracing Andrew Coyne when it comes to economics. While I actually respected him for the first time in his career for his condemnations of harper's abuse of Parliament, he remains utterly deluded on the practice of economics.
Too much blanket criticism for Flaherty's deficits obscures the fact that deficits of some sort were an unaffordable necessity in this present period of stagnation and financial sector implosion. (Like everyone else though, Flaherty went about it the wrong way.)
Coyne believes in classical economics, thwap. He sides more with Friedman than Keynes. But even Coyne says that balancing the budget by 2015 or 2016 is not necessary.
This is all about the next election -- and being able to claim that they kept their promise to balance the budget. It's bad economics -- just as cutting the GST was bad economics.
And, when it comes to economics, both Flaherty and Harper are clueless.
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