The early news was far better

I guess somebody took Stephane Dion aside this morning and gave him a speech about which hill he wanted to die on.

Earlier today 630 CHED was reporting Dion threatened to force a general election on Stephen Harper's plan to cut the GST down to 5%. I was so excited I almost swerved off the Quesnel bridge! Absolutely, Dion, absolutely! Harper has gone too far this time! Forget Kyoto, or Afghanistan, or the crime bill: you want to tell the Canadian people how you felt the need to remove Harper from office because he was going to cut the GST. Fight an entire election on that plank, and the Liberal Party would rocket to heights not seen since Mulroney's sucessor was rewarded for his wise implementation of the Gouge and Screw Tax.

But now, however, the Globe and Mail is reporting that Dion has announced that the LIEberals will not be bringing Harper down tomorrow. Good news for the Liberal Party (and their on-life-support coffers), bad news for me. Ah well.

Also queue, of course, the nay-sayers who have to denounce the tax cuts. Already we have Dion promoting "any other tax cuts" (which Harper should call his bluff on).

Mr. Dion explained that economists from organizations as diverse as the Fraser Institute, the Canadian Auto Workers, the Canadian Manufacturers and Exporters, and Canada’s major banks agree that taking another point off the GST should not be a tax cutting priority for the government. Even a study by the Department of Finance argued that cutting the GST was the worst tax reduction strategy available for Canada.

"For Canadians who would rather save a penny on a cup of coffee, the GST cut might work,” he said. “At the end of the day, however, the vast majority of working Canadians would prefer to bring home a bigger paycheque.”
Now from an economic perspective, Dion has a point. The problem that he doesn't realize, and that Harper does, is the GST is a tax that is reveiled by large numbers of people, and a tax that people notice every single day. Who failed to see on June 1st 2006 that the GST was suddenly "only" 6% every time you went to the store? The GST may be a fairly benign tax (indeed, economists suggest Alberta bring in a sales tax to replace our income tax -- there are arguments against it, but the notion is there). However, the GST cut is a genius political strategy. Next election, people are reminded daily how Harper took steps to axing the tax, something that the Liberals constantly campaigned on and never delivered. The actual benefit to the individual taxpayer may be small. [the tax cut only buys a pizza a month critics say, never bothering to point out that its still a bigger pizza than Chretien/Martin/Dion ever fed us.. -ed] The benefit to the Harper government is huge, and the price that Dion has to pay to fight it is bigger still. Jack Layton may be able to complain about the GST cut (from Jack's twisted perspective, this turns every citizen of Canada into one of these greedy tarsands companies "stealing" more than their "fair share" of the gross domestic product "owed" to the government), but the Liberal Party of Canada has no right to lecture anybody on the subject of GST cuts.


George said...

Great post.

The nerve of Harper, eh? Giving Canadians tax cuts. What will be next? Will he actually snatch babies as the Liberals said he would?

How disgusting! Giving Canadians (some of) their money back - what a criminal!

Clearly, that swine is no longer fit to be prime minister and must be removed!

Surely Harper's cutting taxes is proof positive yet again that he's just a carbon copy of all the neocons in the US like Bush, right?

Geez, and then people wonder why I have been saying that the Liberal Party should be abolished because it doesn't any purpose in our democracy and political system.

I suppose I must be as criminal and deranged as Harper.