August 30, 2015

A Balanced Budget Isn’t A ‘Left’ or ‘Right’ Thing, Part II

By admin

Yesterday, I posted this article showing how NDP governments have been the most effective with respect to balancing budgets over the last 40 years, relying heavily on this article from the Progressive Economic Forum (PEF).

Unfortunately, another article on the PEF, inflates the fears of neocons and voters everywhere that all people on the left seem to want to do is create ballooning budget deficits.

Ugh.  This is SOOOO WRONG.

Wanting a balanced budget is NOT a neocon promise.

I will repeat and paraphrase:  a balanced budget is not a concept owned by the Conservatives.

It’s a lie they spread, yes, but it has CONSISTENTLY been something they are incapable of delivering.  Look at Canada, the US and pretty much any other country around the world.

Budgets explode into deficit when Cons are in control and are restrained when more progressive parties are driving the bus.

The facts show us time and again that those right of centre are completely inept when it comes to maintaining fiscal stability.



Doug Saunders of the Globe and Mail agrees with these facts.

Lefties should feel proud of their ability to conquer and quell budget deficits.

Why then, are we lead to believe that Conservatives are the only ones who are entitled to promising such a thing?

Let’s Dial Back the Rhetoric …

I consider myself a ‘leftie’.  I also consider myself to be fiscally responsible.

The two traits do NOT run in conflict with each other.

I will repeat that I simply believe in different options.

One way to appreciate why ‘lefties’ don’t want deficits:  because we’re mortgaging our financial independence to capitalist entities.  The less we borrow, the less we enrich the 1%.

If we borrow, we should borrow as a financial tool to invest in long-term projects, much like corporations treat debt vs equity.

For the record, I’m also a big believer in funding activities from TWO budgets:

  1. A current account budget, which operates on an annual basis and which (by legislation) can never go into deficit (not a ‘rightie’ perspective, but more one of ‘prudent person / keeping your house in order’ perspective).  This might be called the ‘grocery’ budget.
    2. A capital account budget that is financed by borrowing and which is repaid over the life-time of those capital investments.  For example, borrowing $100 billion to finance infrastructure projects that are funded by fares, tolls and other levies or possibly even not funded at all with a reminder that some public projects result in vastly expanded efficiencies (ie. more people working or getting to work on time or more tourists to a national park, etc etc etc).  This is like the ‘mortgage’ budget.

This latter budget concept is something unique to financial planners and probably finance ministers, but it’s something we have to embrace if we’re to emerge from the bickering about financial largesse vs ruin as a ‘left-vs-right’ concept.

Funding long-term projects cannot happen when we look at our books on a weekly or quarterly basis.  We have to account for different components, their payouts and their impact on society at large.

A great example is a National Daycare Program.

Challenge the Conservative Memes …

During this election, it’s critically important that we challenge ALL of the Conservative lies and memes:

  1. They do not represent financial stability for Canada.
  2. The Conservatives are not the best managers of the economy
  3. Stephen Harper is NOT someone you want in charge of the collective private rights of every citizen in Canada
  4. Security is an obsession of the Conservatives because it is racism thinly veiled as protection of all things, white, old and male in Canada.

If you’re left-of-centre or even moderate in politics, you are doing the NDP a great disservice by spreading the myth and confirming the worst fears of neocons that all lefties want to create budget deficits.

Balanced Budgets Are About Priorities …

Paying down debt is the first step towards financial independence from these corporate lenders and it’s time we had an NDP leader – ie. Mulcair – that wants to invest in Canada’s people rather than interest.

Why would the left want to borrow more money from the world’s money lenders and financial elite?

A balanced budget is easy when you consider the options in front of you.  Ending Harper boondoggles like the Economic Action Plan and investing in proper infrastructure, eliminating tax credits for the 1%, curbing military spending, etc and then investing in long-term programs like National Day Care are all possible and just a few OPTIONS a leader has when creating a budget.

I know this has been a long rant, but remember that everyone has to balance their own books, regardless of political position, so why should we have different expectations for our political leaders and their finance ministers?