Let's Talk Money: Canadian Budget 2009

When parliament returned on January 26th and Michelle Jean delivered the new throne speech, there was only one thing on every ones mind: Will Steven Harper's new budget be good enough for Michael Ignatieff?

I would submit that there was never a question of whether Ignatieff would support the budget, but how big of a price he would exact from the Conservatives for his support. And that variable was dependent on how good Jim Flaherty's work was, not the variable that decided on Liberal support.

Let's rewind to the events of early December. Jack Layton, Gilles Duceppe and Stephane Dion initiate proceedings for a preemptive coalition after the Conservatives unveil their politically disastrous Economic and Fiscal Update. When Stephane presents the agreement to his party for consent, Michael Ignatieff is one of the last MPs to sign his name. Then Harper issues a brief statement using that emergency broadcast thing, Stephane Dion gives a shoddy reply, and finally Harper prorogues parliament.

So most of that was review, but the key thing to notice is that Ignatieff was never keen on this coalition to begin with. So, when Bob Rae and Dominic Leblanc bowed out of the leadership race to give Iggy his coronation, that was the moment when the coalition began to slowly die inside. Not when Ignatieff decided to support the Harper budget.

I suppose there was always the possibility of Ignatieff tearing up the Coalition agreement but voting down the budget, but I just can't see that making sense in the eyes of the public, his actions would be viewed through the lens of December 2008.

So, that brings us to why Ignatieff doesn't like the idea of a coalition, and how he came to his final decision on the budget January 28th.

Firstly, Ignatieff has always been a bit more centrist than his party's current leftist affiliation would seem to suggest. There was his extremely controversial support of the war in Iraq and his comments during the leadership race of December 2006 on the events in Israel, both of which solidified this assertion. This is one possible reason that he had qualms about a coalition with the NDP, supported by the Bloc.

The second factor that I would hope was the deciding factor in his decision is the conditionality of the coalition's viability by an alliance with the Bloc Quebecois. As soon as the coalition was announced, Gilles Duceppe immediately came out and said something to the effect of, "This is good for Québec." Which, taken in context, translates to: "This is good for the Bloc Quebecois." Allowing a separatist party to hold the balance of power threatens national unity, and could be disastrous in a time of economic uncertainty when Québec has a tendency to ask Ottawa for money.

The party has no concerns about the rest of Canada, which in my own view, any legitimate federal party should be. I completely support the notion of a separatist party at the provincial level, as any province which has an overwhelming majority of people who want to separate from Canada should have the right to do so. But the purpose of the House of Commons is to look out for the best interests of all of Canada, not just one province.

Giving a separatist party the potential power to dictate the policy of our country would a mistake. Which makes me glad that Ignatieff choose not to do that.

What he chose to do instead is, in his own words, "Put Stephen Harper on probation." This was a smart choice in my view. Not voting for this budget would either had the consequence of giving power to the Bloc as suggested before, but it may have instead driven the nation into a constitutional crisis centered around Michelle Jean as she would have had to engage in a rare exercise of her authority.

Had she chosen to pick up the idea of a coalition government, her authority as an appointed official representing a foreign monarch would be questioned as to its legitimacy, prolonging political turmoil in a time of economic crisis.

Had she chosen to call another election, not only would Ignatieff have been crucified for refusing to give the stimulus to Canadians that they expected (not to mention spending another $300 million dollars on an election), but again the role of the Governor General would have been questioned as necessary if she is simply an extension of the Prime Minister's will.

Instead what Mr. Ignatieff did was buy himself time. What he lacks at the moment is national support for both himself and his party, and funding. These tend to be tied together, as we can see from the brilliant success of Harper's attack ad's on Stephane Dion leading to his success in the 2008 election.

Once the Liberals recover their fiscal robustness as a party by building support, and recover their political robustness by building a new financial base, Ignatieff can choose at any one of three times during the next year to throw down the gauntlet and force an election.

As a sidenote, I mentioned the possibility of Ignatieff being crucified in an election because of the size of the Conservative stimulus package. It may be possible that this stimulus package will end up doing nothing. Not being an expert on the economy, I have little opinion to offer on that point. But in the eyes of the public I know that all they see is the words "$65 billion" and "stimulus" and immediately assume that the budget will be good for them. The majority of voters don't have degree's in economics or finance. All that they know is that they don't have enough money right now, and the government is giving them money.

It's as simple as that. And for that reason alone, it would have been unwise for Ignatieff to vote down the budget.

I've digressed quite a bit in this post, so let's sum up.

Ignatieff wouldn't have gone with a coalition because Harper's not stupid enough to give him a reason to. The real wonder was exactly how much Ignatieff would demand for his party's support. And it seems to me that he worked out for himself, and for Canadians, a fair price. Regardless of what Harper is or isn't going to actually accomplish for the country.

Isreal in Gaza

The past week saw an invasion into the Gaza strip by the nation of Israel, who cited several hundred attacks on Israeli soil as their cause of action. These attacks were apparently made by Hamas, a political party that is currently the leader of the Palestinian National Authority. Hamas is, however, considered by the nation of Israel to be a terrorist organization. So, on Saturday December 27th, Israel launched an air strike on the Gaza strip, killing hundreds of innocent civilians as a precursor to the current incursion by ground troops.

The ownership of the region of Israel has been in contention for nearly all of written history. Since long before the Roman Empire rose to power, the nation between the Mediterranean Sea and the Jordan River has been disputed, from the time that Abraham walked into it's borders on the promise of his God to the Crusades of the Middle Ages. From the promise by Britain that their Arab colonies would become self governing to the creation of the Jewish state of Israel in 1947 by the United Nations, this region of the world has been contested on mainly religious grounds by Islamic, Christian, and Jewish groups as it is considered to be the birthplace of all the aforementioned religions.

And I would hope that someday, all of these religions and countries could someday find a way to bring about a lasting peace in the region that would allow members of all faiths in and out of the holy places and sacred grounds that make Israel so sacred.

It escapes me what exactly the beef that various people have with Israel or it's neighbours is. Maybe those of Muslim faith are angry because Britain broke their promise to them after both the First and Second World Wars, the promise that promised the Arabians self-governing Independence. Maybe those of Jewish faith are concerned that if they lose the homeland that they have been given, they will be in danger of another anti-Semitic tragedy like the holocaust. And maybe those of Christian faith in the Western World are simply too proud or too worried about their oil stocks in the middle east to give up any ground to further the cause of peace.

But the waters of the Mediterranean and the sands of Galilee are soaked with the blood of Jew, Muslim, and Christian alike. It is the responsibility of all parties involved, especially those with the power to make a difference, to find out what the concerns of the other parties are and try to reach a compromise so that the fighting can come to an end. Even a conflict of epic religious proportions can be stopped, and anyone who says otherwise better take a close look at how Canada has lived in peace with two different predominant religions for so long. Every day that there is inaction there is more suffering. Call me naive, but it is not beyond two or more groups of grown leaders to come together and say sorry to each other. The United States and the U.S.S.R. did it after the Cold War, and those two countries were about as black and white as you can get.

We have been fighting for too long over this region of the world. It must stop. Because if we don't, another child tomorrow in Israel will wake up without a sibling or parent. Because if we don't, another angry, confused, and scared kid is going to be convinced to strap a bomb to his chest and blow up anything that has the American flag on it. Because if we don't, that parent of the soldier in Iraq or Afghanistan is going to break down in tears as the officer comes to his or her door with the news that their child is dead. Because if we don't, another citizen of the United States, Canada, or any given country that is considered to be "the Western World", is going to end up prejudiced, bigoted, and angry against the radical Islamics that did that to that family's child. Because if we don't, that dead child's younger sibling beats up a Muslim student at school. Because if we don't, that incident gets reported to the media who then paints all the Islamic people in the world with the same brush. Because if we don't, the radical Islamics in Hamas launch rocket attacks against Israel.

Because if we don't, another child tomorrow in Israel wakes up without a sibling or parent.

The cycle continues, dividing the world at a time when we need to be worrying about bigger problems, like how to feed Africa, China, and India, and how to stop global warming from flooding all of Manhattan. If we cannot unite, then we cannot solve our biggest problems. The problems that threaten to consume us all.

The Economy

As the biggest issue in the minds of Canadians along with our current political predicament, the economic recession is beginning to make itself felt in ways small and large from coast to coast to coast. Gas prices have dropped to eighty one cents in Victoria, British Columbia, and that's saying something for a city not only with a carbon tax but a reputation for prices in the $1.40 range. Dropping oil prices hit industries in Alberta and Newfoundland very hard, causing the losses of jobs, profits, and prosperity across the board.

This is only one example of how the recession of our times is becoming physically well known to everyone in this country. Let there be no doubt that hard times are ahead, and without some sensible action our prosperity will stop increasing, and may begin to slip downhill.

Sensible action though it seems, is a bit too much to ask for. From what I understand of the various bailouts that are being proposed to many businesses here in Canada, they make little sense. General Motors and Chrysler are asking for the Canadian and Ontario governments to give them a bailout of approximately $4 billion dollars.



Indeed, the automotive industry has been one of the hardest hit industries in both Canada and the United States by the recession. However, these industries were already lagging behind in their performance before the recession hit, having been surpassed by auto makers in Asia such as Toyota, Honda, and Mazda. It has been said that when a crisis hits a company, the mettle of it's business practices is tested more so than at any other time. None of these Asian companies have asked their governments for a financial bailout package, because their business practices are financially sound and they can maintain their companies without a crutch from the state.

Of course, one must be aware of all the jobs that are at stake in Canada if the automakers were to shut down. I believe the figure of jobs lost in the automotive industry in Ontario in the past year is close to 100,000, and that figure would likely multiply significantly if the auto makers in Canada were forced to cut costs even more. But bailing out these companies would delay the inevitable. Canadian automakers have offered little in the way of a scheme by which they would put their businesses, well, back in business. To offer the big 3 automakers taxpayers money so they can fix their problems without any plan to do so is like asking every man, woman and child in our nation to shred $120 and hope for the best. It's ridiculous, and irresponsible.

There are better solutions. Make the bailout conditional on a blueprint for success to start with. If GM wants our money, they should tell us exactly how they will make it work for them, and for us. In addition, parliament should discuss regulation of mass employers like the GM and Chrysler that gives us some kind of insurance that these kinds of job losses won't happen again.

But at the very least, don't loan my money away to someone who doesn't even know if they can pay me back.