Double Blind

Shiela Copps, the former Liberal deputy prime minister that resigned (and was re-elected shortly after) after the 1993 election after the Liberals failed to scrap the GST, said the most accurate commentary out of the major headlines regarding the tax cuts:

Sheila Copps: Nothing makes my blood boil more than to see a parade of so-called experts trashing reductions to the Goods and Services Tax. Having endured the scars of that hated tax, I welcome any move by any government to listen to the people. The finance minister’s decision to ignore the naysayers was brilliant politics. A cynical observer might question his timing, overshadowing a critical auditor-general report and the income trust reversal anniversary. Communications aside, the document could have been a dream launch for a desired Tory election. Finance Minister Jim Flaherty pulled off a masterstroke yesterday. Mr. Flaherty gave half a loaf to those looking for across the board personal and corporate cuts. But he ignored their railing about the GST. He listened instead to the taxi driver and the small retailer hanging on by a thread.

Cutting the GST is good politics, but it will also give Canadians a 1% incremental savings on the price of all GST-able items they purchase next year. 1% doesn’t sound like a lot, but over the period of a year, or even a decade, it adds up.

The other brilliant commentary (out of the 20 or so I’ve read on the issue) is from Deirdre McCurdy:

Deirdre McMurdy: With the release of the autumn economic statement yesterday, Stephen Harper and Co. have proven once again that a minority government can be at least as effective in achieving its goals as any majority. Once again, the Tories have got their way. And the beauty of their political reality is that they can be as bossy as they like about corporate tax cuts or crime legislation, without getting the rap for being arrogant — all the while further weakening the public image of their opponents. For the Tories, it is actually better than just a win-win. If a freshly-minted majority government were to put forward some of the legislation this government now has on the table — one obvious example is the GST cut that virtually every economist decries and the other parties oppose — it would be accused of abusing both democracy and common sense with its actions. But in the present context, they can make two very justifiable claims: the cut is consistent with their election promises (“promise made, promise kept”, as they like to say), and, to their delight, they effectively achieve buy-in from the opposition by making them support or at least abstain from voting on the issue

This is just brilliant. Having a minority government (in this case) seems to be a perfect recipe for making yourself look good if you can introduce good policy, backed with public support in the polls. The Conservatives can govern as if they have a majority, which is very unlike Paul Martin’s government in 2005 when Parliament was a death trap for him.

By taking the GST cut out of the political equation, you can be sure that the Conservatives will not be lobbying for a lower GST in the next election. The Liberals, if they are to follow through on their position would be campaigning for a higher GST and lower income taxes. The Conservatives, on the other hand, can just lobby for lower income taxes. Who would you vote for then? I knew Harper was a smart cookie, but we haven’t seen this sort of political brilliance since Chretien was in office.

This entry was posted on Wednesday, October 31st, 2007 and is filed under Politics. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.