So, Finance Minister Jim Flaherty's budget survived a vote in the House of Commons by a margin of 176 to 119 on March 27 thanks to the support of the Bloc Quebecois.
It will become the law of the land. It will not be the trigger for a spring election though; Lord knows, a good number of conservative-minded voters would like to boot this Conservative government for its free-spending ways.
For the record, Stephen Harper's Conservatives have committed the government to program spending of $200 billion this year, which is up $25 billion, or 14.3 per cent, from the 2005-06 fiscal year when the voters turfed Paul Martin and his profligate Liberals from office. Flaherty's 477-page budget contains dozens of new spending initiatives, most of them piddling.
But a few are really galling, particularly the $4.1 billion that will be transferred to Quebec over the next two years as part of the government's plan to correct the so-called fiscal imbalance between Ottawa and the provinces.
Quebec Liberal Leader Jean Charest really rubbed it in by promising in the final days of a provincial election campaign to spend $700 million of that money on a tax cut for Quebecers. Imagine that: Tax dollars raised in Ontario, Alberta and, to a lesser extent, British Columbia being used to finance a tax break for Canada's most indebted and coddled populace.
Apart from such bald irritants, the budget demonstrated that the Harper Conservatives have adhered to the tax-and-spend approach of the Trudeau Liberals, the Mulroney Progressive Conservatives and the Chretien/Martin Liberals.
It also revealed that Harper has adopted the same Quebec strategy as his prime ministerial predecessors, which is to take on the separatists while cozying up to the rest of the population.
Some voters in other parts of Canada expected something different under Harper. This strikes me as naive. Harper is the leader of a new political party. He is a prime minister with a minority in the House. And he is presiding over a strong economy and a prosperous country. Who breaks with the past and changes direction under these conditions?
Governments can adopt new approaches and keep the public with them in times of crisis. We had a crisis in this country in the mid 1990s when our public finances were nearly in ruins after 25 years of deficit spending and mounting debt.
Remember the famous Wall Street Journal editorial of January 1995, titled "Bankrupt Canada," which concluded that this country "has become an honorary member of the Third World in the management of its debt problem."
A lot of liberal and left-leaning Canadians scoffed, but Jean Chretien and Paul Martin got the message. Two months later, they introduced a landmark budget that began the process of cleaning up our national finances.
The problem is they missed an historic opportunity to change the political culture and public expectations of government. That was the moment to begin reducing or cutting off the flow of money into our vast array of transfers and subsidies and grants and handouts of every kind.
It was the time to put the brakes on activist government and to declare the welfare state a finished product that would be maintained but not expanded. Chretien and Martin should have had the courage to say that after half a century of redistributing the wealth, it was time for government to encourage the creation of wealth.
They should have had the foresight to develop economic policies and programs to prepare the country for the challenges of the 21st century, specifically the aging of the population, the shrinking of the labour force, the rise in health-care costs and the growing manufacturing clout of China, India and other Asian nations.
These problems were on the horizon when we nearly hit the wall financially in the mid-1990s. By the time the Liberals were flushed out of office in January 2006, they were shaping our world. Chretien and Martin did nothing about them because they were like two old leopards who couldn't change their spots. They were wedded to the solutions of the past.
Our current prime minister is said to be politically shrewd and wise beyond his years, but his focus is short term. Harper needs to survive the next vote in Parliament. He is desperate to convert his minority to a majority. He is not going to ask Canadians to change their ways. He is not going to address the big challenges: Weak productivity, an uncompetitive tax system, an over-reliance on government, the loss of manufacturing jobs to Asia and the acute shortage of service-sector workers.
Nor will he trouble us with two big questions we should be asking ourselves: What will we be making in this country a decade from now? And where will our economic advantage lie in a world where Asian countries can manufacture things as well as us, and at a fraction of the cost?
(D'Arcy Jenish can be reached at jenish@businessedge.ca)
