Last weekend I attended the Manning Centre Conference, an annual event chaired by former Reform Party leader Preston Manning. This get-together is often referred to as “Woodstock for Conservatives”, but without the great music, unfortunately. Needless to say, much of the discussion in the corridors pertained to the unfolding soap opera with the Liberals and the SNC Lavalin scandal. The formal sessions focused on everything from immigration issues, the impact of social media, pipeline politics, environmental policy and digitizing government, among others, and there were keynote addresses by former George W. Bush senior advisor Karl Rove, Andrew Scheer, Doug Ford and General Rick Hillier. All in all an interesting weekend of conservative-oriented discussion and networking.
The panel on which I was a speaker involved fiscal policy, and not surprisingly was quite depressing. One of the other panelists, Jason Clemens of the Fraser Institute, commented on the recent federal budget and looked back through history to evaluate which Prime Ministers were the biggest spenders. Given the big-spending ways of the current federal Liberal government, it is perhaps not surprising that per-person spending in 2018 was just slightly ($72) less than the all-time high of $8,711 recorded in the recession of 2009 by Prime Minister Harper. What is most concerning is that this sky-high spending is happening when the economy is growing. Estimates by the Fraser Institute and others indicate that when the inevitable recession comes, the deficit and debt will skyrocket as tax revenues fall and spending on things such as EI and social services increases. Estimates depending on the severity of recession saw the deficit coming in at anywhere from $40 billion to as high as $120 billion. By way of comparison, the total debt accumulated during almost a decade of government under Harper, including a serious recession, was about $150 billion. That is bad enough. A deficit of $120 billion in just one year would be truly shocking and have a serious long-term negative impact on Canada’s fiscal health.
The second panelist, former federal Finance Minister Joe Oliver, spoke about the politics of budget making, and the fact than an effective minister of Finance essentially has to be “Dr. No” as demands are made regularly for more and more spending. Weak Finance ministers are the worst enemy of sensible fiscal policy as they accede to too many of the never-ending requests for more taxpayer dollars, and the current occupant of this position, Bill Morneau, is a good example of this. Unless something drastic changes with this Liberal government’s approach to budgeting or the Liberals lose the next federal election, it appears that another term of this government and its predilection for overspending will be dangerous indeed for Canada’s future solvency.
My comments revolved around the lack of any accountability for spending within the operation of governments, and that this factor – regardless of which political party is in power – mitigates against spending control in government. It is well known that government employees earn well in excess of their private sector counterparts including their generous benefit packages. Merely bringing public sector employees’ compensation into line with the private sector would save about $40 billion annually – funds that could be better spent on eliminating deficits and improving the quality of public services. Getting rid of early retirement in government would also save billions as the need to replace workers retiring early and pension payments for younger retirees would both be reduced. Unfunded pension liabilities are also enormous in government and its various arms-length agencies and Crown corporations, and will impose a drag on government finances for many years to come.
Most Canadians are aware that we have a serious and growing public debt problem, but the content of this session implied it is likely considerably worse than most people realize. I will touch on some of the other important issues covered during the conference in future columns. The discussion on fiscal issues in which I participated was a wake-up call that should concern all Canadians not only in the near term, but also in terms of the burden being imposed on future generations by the irresponsible spending habits of governments today.
She has published numerous articles in journals, magazines & other media on issues such as free trade, finance, entrepreneurship & women business owners. Ms. Swift is a past President of the Empire Club of Canada, a former Director of the CD Howe Institute, the Canadian Youth Business Foundation, SOS Children’s Villages, past President of the International Small Business Congress and current Director of the Fraser Institute. She was cited in 2003 & 2012 as one of the most powerful women in Canada by the Women’s Executive Network & is a recipient of the Queen’s Silver & Gold Jubilee medals.