Tuesday, June 02, 2009

Premier Gordon Campbell makes financial fudge with phony deficit

Bill Tieleman’s 24 Hours & The Tyee Column

Tuesday June 2, 2009

B.C. financial fudge capital of the world

View Tyee article and comments here

By Bill Tieleman

Published: June 2, 2009

I can tell you this: the deficit for 2009-2010 will be $495 million maximum.

- Premier Gordon Campbell, April 23, 2009

The BC Liberals have a new plan to stimulate the provincial economy -- make British Columbia the "Financial Fudge Budget" capital of the world.

Finance ministers from around the globe will travel to Victoria to learn at the feet of the masters -- Premier Gordon Campbell and Finance Minister Colin Hansen -- about how to craft the slipperiest, most expensive fudge ever seen.

That's the only conclusion one can draw from the most astonishing, outrageous and massive fudging of the B.C. budget in provincial history -- and all done during an election campaign.

So while Campbell said that if re-elected, the 2009-10 budget tabled in February with a $495 million projected deficit will be "pretty much the budget that’s reintroduced", not even the premier's closest corporate allies believe him.

Trust issues

Jock Finlayson, the B.C. Business Council executive vice-president, says he would not be surprised by a $2 billion deficit -- and Finlayson sits on the province's own council of economic forecasters.

Bank of Montreal Deputy Chief Economist Douglas Porter agrees with Finlayson, saying he could "easily foresee a deficit of that magnitude."

And last year's so-called balanced budget for 2008-09 could also have a deficit, says Helmut Pastrick, chief economist for Central 1 Credit union.

Pastrick has said consistently from February on that B.C.'s deficit would be much larger than projected and most recently predicted it would be about $1.5 billion.

Bitter fudge

What all this BC Liberal fudge means for ordinary and particularly lower income British Columbians is not a sweet treat but a bitter pill to swallow as the government begins dramatically slashing public services.

For even if Campbell decides to temporarily run a much bigger deficit than he promised to deliver, it will still require massive spending cuts and/or a significant tax increase to keep the red ink from staining the BC Liberals permanently pink.

And given that Campbell introduced a 25 per cent tax reduction when he came to power in 2001 and has steadfastly maintained that such reckless cuts stimulate the economy, don't expect him to hike taxes on business or high income earners.

When previously in a jam, facing an impending shortfall in 2002, Campbell stuck to his tax cutting rhetoric even as he was forced to claw back hundreds of millions of dollars in revenue from ordinary British Columbians.

How? By increasing their B.C. Medical Services Premiums by 50 per cent, eliminating several medical services and imposing a host of onerous user fees that are still in place today.

The BC Liberals have already promised to cut $2 billion in spending over three financial years through "administrative and other savings" and "efficiencies" -- want to bet that number goes way up along with the deficit?

Downsizing battles loom

There's another big factor -- almost all public sector union contracts expire shortly after the February 2010 Olympic Games – and with B.C.'s economic disaster status at that point, expect a nasty round of bargaining as the government tries to downsize employees faster than a bobsled on pure ice.

That's one reason Campbell and Hansen hope to delay tabling a new budget in the Legislature for as long as possible -- to give themselves more "wriggle room" and more time to blame the world-wide economic crisis instead of their own inability and unwillingness to acknowledge the situation long before the election.

But will we see business groups up in arms like they were when the 1996 NDP government brought in a $355 million deficit when it had projected a balanced budget in that year's election?

Will the National Citizens Coalition again finance court challenges against government fraud?

Not a chance -- but these hypocrites should be embarrassed when their own business-funded BC Liberals' fudge make the NDP's past mistakes look like penny candy.



Gary E said...

Gee Bill. Who knew the budget was going to be 2 billion. Certainly not the Liberals who control (are best suited to manage the economy) the purse strings.
And half the eligible voters can't bitch because they didn't vote.

Anonymous said...

So what will it take? The BCLiberals are better than teflon because even if "fudge" sticks to them NO ONE CARES. People must be aware by now the depths to which this government has descended but still not a peep...

Except from the usual and very hardworking few like B.T., BCMary, and Sean Holman.

We seem to entered an era of complacency like no other.

BC Mary said...

Now I begin to understand why Gordo is creating a bigger, even more expensive propaganda unit:

his 223-person, $31-million a year Public Affairs Bureau apparently wasn't big enough to teach us all to love what's going to happen next.


DPL said...

Gordo says the defecit will be .... sort of reminds me how he would honour collective agreements and wouldn't sell BC Rail or do some many others things he swore never to do but did. The suckers still voted for him and the rest of uswho didn't are stuck with him till at least after the Olympics are over and before the bills come in.

David St. Hubbins said...

Nice work, Bill. Not once was this even hinted at by the big media during the election campaign.

I was listening to Harvey Oberfeld on the Bill Good show last week, and he really nailed the issue of media bias. It's not overtly intentional, but more a subtle culture of big media nurtured by big private ownership over decades. It's not what they say, but what they don't say. Your article illustrates a key point Oberfeld made: NDP scandals are treated much differently than right-wing government scandals.

Baldrey, Palmer, Smyth, Leyne et al., I remember this press gallery hammering the NDP relentlessly on the "fudge-it budget" and fast ferry fiasco; where were they during the campaign when we needed to issue equally tough questions about the Campbell budget scam, the Convention centre fiasco, etc...?

I guess that's why guys like you write for the Tyee and not Canwest.

I don't always share your opinion, but on this one you nailed it - even if you don't fully expound the broader implications about media bias.

Kris Klaasen said...

Wow! Does the NDP know about this? Sure hope someone tells them!

Anonymous said...

And no matter what Campbell get's away with this stuff year after year after year. Meanwhile Carole James is stayting on for four more. Anyone else see the problem with this pattern ?

Anonymous said...

If Gordo is proven to lie about the budget deficit, to improve recent election results, will the courts overturn the election?

Evil Eye

Anonymous said...

It doesn't matter what the NDP say the Liberal Press bias means it will be hidden and maybe mentioned once in a news cast.

Rod Smelser said...

Wow! Does the NDP know about this? Sure hope someone tells them!

Well Kris, that hurts a bit.

Of course they know and they knew, yet there wasn't a single NDP advert on TV, radio, or in print on this subject.

Nor was there any advert ominously warning - (grainey B&W and slow motion shots, harsh musical score, and finally a computer graphic where Campbell's smiling face morphs into a leering Bennett) - that 2009 is about to turn into 1983 all over again once the election is over and a new budget comes down in July.

How does ammunition like that get left on the shelf unused? Is that how a rational competitor acts in an adversarial system, by refusing to fire their best shots?