Harper about to step into Rae's shoes

Avro

Time Out
Feb 12, 2007
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A test of Harper's deficit nerve TheStar.com - Opinion - A test of Harper's deficit nerve
November 26, 2008
Thomas Walkom

Two cheers for Prime Minister Stephen Harper. He understands the severity of the global economic slump. He knows what has to be done. Now he just has to deliver.
Harper eloquently articulated his conversion from what-me-worry free-marketeer to alarmed Keynesian last weekend at a meeting of Pacific Rim nations in Peru.
That's when the Prime Minister admitted that he was surprised by the speed of the downturn, alarmed by the prospect of deflation and prepared to take unprecedented fiscal action – either by raising federal spending or cutting taxes.
But Harper's real epiphany seems to have come a week earlier at the Washington summit of the so-called G20 nations.
He heard there from other leaders, and from International Monetary Fund managing director Dominique Strauss-Kahn, just how bad the situation is.
As Strauss-Kahn explained to reporters later, the IMF now sees global deflation – a situation where prices of all commodities begin to spiral downward – as the real danger.
That's because deflation can turn a recession into depression. Businesses, fearful that their products won't be worth as much later, put off expansion plans while consumers, confident that prices will drop, postpone spending.
The IMF chieftain's advice to leaders was to pump massive amounts of cash into their respective economies, either through new spending or new tax cuts. Economists call this fiscal stimulus. Normal people call it putting money into people's pockets.
Strauss-Kahn even provided a target. Countries with low inflation (like Canada), he said, should provide fiscal stimulus equal to about 2 per cent of their national economies.
In Canada's case, that works out to a whopping $31 billion.
Note that if the federal government doesn't do anything next year, it's likely to run a so-called passive deficit of between $3.9 billion and $14 billion, according to parliamentary budget officer Kevin Page – just because the economy is slowing down.
But the IMF is calling for $31 billion in active fiscal measures on top of that. Which would translate into a total federal deficit next year of about $35 to $45 billion.
Strauss-Kahn also pointed out, correctly, that the fastest way to boost the international economy is for governments to direct this fiscal stimulus to low-income people and strengthen social safety nets for the poor and unemployed. That's because such monies are usually spent quickly.
He noted that infrastructure spending on projects like subways may be useful but will take longer to have any effect.
And he said that if countries worked together to meet this target, the combined effect would be to boost world economic growth by two percentage points and reverse the downward spiral.
Finance Minister Jim Flaherty, who seems a more reluctant convert to the interventionist views of the late John Maynard Keynes, says that the government's past tax cuts should be counted toward that IMF target.
It's a nice try. But in the harsh world of reality, the past is past. What the G20 said – and what Harper says he accepts – is that Ottawa has to pump new money into the economy if Canada is to do its bit. And it must do so soon.
Harper's allies in the business press (and his own party) will go ballistic if he does what needs to be done and orders Flaherty to post a $35 billion deficit next year. We shall see how much nerve this Prime Minister has.

Toronto Star

So what will all the cons do when lil' Stevie starts racking up huge deficits?:lol:
 

L Gilbert

Winterized
Nov 30, 2006
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the-brights.net
Blame it on Liberals, of course.
Deficits and surpluses don't mean much except as a measure of how well one does at budgeting. One who has a balanced budget is a good budgeter. One who has deficits or surpluses isn't a good budgeter.
What IS important is whether one's debt goes up or down. And so far, under Harpy, Canadian debt is going DOWN.
Stingy Investor: Canadian Federal, Provincial and Municipal Debt & Tax Clock
 

Avro

Time Out
Feb 12, 2007
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Blame it on Liberals, of course.
Deficits and surpluses don't mean much except as a measure of how well one does at budgeting. One who has a balanced budget is a good budgeter. One who has deficits or surpluses isn't a good budgeter.
What IS important is whether one's debt goes up or down. And so far, under Harpy, Canadian debt is going DOWN.
Stingy Investor: Canadian Federal, Provincial and Municipal Debt & Tax Clock

True, Harper is still enjoying the legacy Cretien and Martin left but 2009 will be a rough year, will Harper play the what me worry game or take this s h i t serioulsy?

We will see.
 

Socrates the Greek

I Remember them....
Apr 15, 2006
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True, Harper is still enjoying the legacy Cretien and Martin left but 2009 will be a rough year, will Harper play the what me worry game or take this s h i t serioulsy?

We will see.

My prediction here is that by the time the end of 2009 rolls around the economy will have taken a sh!t kicking, Harper and his acolytes will not be able to correct or stop this outcome. By the time 2010 comes around the S-plus lingo is in the back burner, while there may be a $10Billion deficit born and by then the Liberals will be fully restored. The Cons will be all bruised and confused by then, and the Canadian voter will be looking to change Government...........
No crystal ball just facts.......
 

Risus

Genius
May 24, 2006
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My prediction here is that by the time the end of 2009 rolls around the economy will have taken a sh!t kicking, Harper and his acolytes will not be able to correct or stop this outcome. By the time 2010 comes around the S-plus lingo is in the back burner, while there may be a $10Billion deficit born and by then the Liberals will be fully restored. The Cons will be all bruised and confused by then, and the Canadian voter will be looking to change Government...........
No crystal ball just facts.......
soc, you and your 'facts' are full of crap. Prognosticate all you want, but it still smells like what it is....
 

shadowshiv

Dark Overlord
May 29, 2007
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At this time, I don't think it would matter who was in charge. The economy is going in the crapper no matter what, and it'll be a while before our country will stabilize itself.
 

Socrates the Greek

I Remember them....
Apr 15, 2006
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soc, you and your 'facts' are full of crap. Prognosticate all you want, but it still smells like what it is....

Hey Risus, look you and some others can put me down on my thoughts, but don't let your deep rooted Conservative thoughts miss guide your logic. The minute you start that, soon after you would get very confused.......
Here pay attention to this fresh news witch looks like is going to hurt the Cons.

TheStar.com | Canada | Tories expected to slash party funding

"Opposition parties are likely to see the measure as a declaration of war only weeks after the election because of the Conservatives' commanding strength in fundraising.
The president of the Treasury Board rejected that suggestion.
"It would hurt us the most," said Vic Toews, although he refused to confirm the measure publicly.
Such a measure would cost the cash-strapped Liberals $7.7 million, the NDP $4.9 million, while the Bloc Quebecois would take a $2.6-million hit and the fledgling Green Party would be out $1.8 million".


Just imagination the Cons getting defeated in the house over this, just few weeks in power and they think they will bring the opposition to its knees.
Bring it on Harper you will get slaughterd in the house...........
 

scratch

Senate Member
May 20, 2008
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As I keep say after the win `the dirt and dirty laundry` start to show up.