Flaherty’s stimulus spin
Here is a challenge for you: find me a quote from Jim Flaherty during or just after the release of the October Economic and Fiscal Update where he says the tax cuts in the EFU were a stimulus package because of worries about an economic slowdown in Canada. I’d love to see that because here is the latest spin:
Federal Finance Minister Jim Flaherty says it’s unfortunate the U.S. government waited so long to bring forward an economic stimulus package of the kind the Bush Administration proposed late last week.
“Regrettably, in a sense, I suppose, the Americans were a bit slow to come forward. But they have now and they’re going in the right direction,†Mr. Flaherty said Wednesday in a telephone interview from Dubai, where he’s promoting trade and investment with Canada.
He said he’s glad the Harper government brought in a package of tax cuts last year, including a $14.7-billion in reductions to consumption and corporate and personal taxes last October – measures that are expected to stimulate the Canadian economy.
“We were ahead of the curve in what we did last March and particularly Oct. 30 in Canada.â€
After months of deepening gloom for the U.S. economy, U.S. President George W. Bush called for Washington to enact a stimulus package worth up to $150-billion (U.S.).
Ask the question any way you like, the answer is always tax cuts.
It is rather presumptuous of Flaherty to argue that the Americans have been slow, but that his government has been ahead of the curve. Yesterday, Canadian markets were (temporarily) bailed-out more by the US Federal Reserve’s large, decisive interest-rate reduction than by the Bank of Canada’s wimpy, quarter-point cut.
However, if I were one of Flaherty’s spin doctors, I would probably point to the second paragraph of the EFU’s introduction:
These sentences cast tax cuts as a response to worries about the economy and even include the verb form of “stimulus.â€
I think that the point remains that “ask the question any way you like, the answer is always tax cuts”.