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Ottawa told to cut taxes and spend on defence


Yard Ape

Cut taxes and spend on defence, Ottawa told
C.D. Howe Institute, Alliance agree

Eric Beauchesne
Southam News
OTTAWA - The federal government can afford to cut taxes and boost spending on national security in Monday‘s budget without going back into a deficit, the Official Opposition and a major economic think-tank argued yesterday.

Paul Martin, the Minister of Finance, has warned that with the weakness in the economy and new national security demands in the wake of the Sept. 11 terrorist attacks, the government cannot afford further tax cuts.

Instead, Mr. Martin has said any further economic stimulus should come from low interest rates.

The C.D. Howe Institute in its pre-budget proposals argued, however, that by tightening spending on business subsidies, training programs and natives, the government can afford more than $20-billion in new tax cuts and spending over the next five years.

Jason Kenney, the Alliance finance critic, in a separate package of budget proposals, warned that Canada cannot afford not to cut taxes further.

"It‘s so important for us to continue getting those taxes down because Canada continues to fall behind the standard of living in the U.S.," Mr. Kenney said. "Canadians‘ standard of living has declined from 87% of the U.S. level in 1980 to 70% of the U.S. level in the last year.

"We cannot afford to allow the security imperative and the Liberal recession to let us ignore this long-term decline in our economy, which we must address with further tax relief in this budget."

The C.D. Howe Institute proposed $13.9-billion in additional tax relief for individuals and businesses over five years, as well as $3.7-billion for new security measures, $3.2-billion in new health, education and infrastructure spending, and a further $2.7-billion for economic innovation and development aid.

The institute projected that its proposals, on top of the downturn in the economy, would reduce this year‘s $8.9-billion surplus to $5.6-billion next year, including $3-billion in contingency reserves and $1-billion in economic prudence.

Assuming the economic downturn will be shallow and short, it projected the surplus would then rebound and rise steadily to almost $25-billion in the fifth year.

Its spending proposals over the five years includes $2.6-billion for improved national security and military equipment and pay, and $680-million for intelligence-gathering and processing.

Another $500-million would go toward upgrading seaports, airports and border crossings.

The tax cuts would include accelerated reductions in personal income taxes, in the taxes on dividends and in EI premiums, as well as the elimination of corporate capital taxes and increases in the ceilings on annual RRSP contributions. The institute also proposed new pension savings incentives.

It said that despite the increased spending and tax cuts, its budget proposal would allow the government to cut its debt to $492-billion or 37% of GDP in five years from $547-billion or 52% at the end of last year.

It also joined the Alliance in warning against subsidizing the extension of high-speed Internet access to rural Canadians, a project championed by Brian Tobin, the Industry Minister.

Meanwhile, the National Citizens‘ Coalition has launched a radio ad campaign urging the Liberals to focus spending on the military and national security.
This just confirms what everyone already knows.

But since it comes from the government appointed watch-dog and not the opposition or a university professor it should mean more.
I‘ll believe it when I see it. Even if more money is spent on defence, the civil servents in green will sent up new study groups, departments, sections, and committees to decide how to spend it. They‘ll finally come with a plan, five years from now, only to discover that the money is no longer available due to the administrative costs in developing the plan. Meanwhile the pencil pushers will have had job security, and free trips around the country visiting focus groups and gaining their input.
Disrepair in military deplored
Wednesday, December 05
Globe and Mail


Ottawa — Canada‘s auditor-general sounded the alarm over the state of disrepair in the military Tuesday, even as the country‘s navy plied the seas in the war on terrorism and other soldiers remained on standby for operations in Afghanistan.

Maintenance difficulties are reducing the combat readiness of several types of aircraft and keeping many soldiers from getting enough training, Auditor-General Sheila Fraser said in a report.

The Defence Department also failed to track adequately equipment availability and blamed a lack of personnel, money and even a slow delivery of parts for the difficulties.

"The (Defence) Department has frequently said that the Canadian Forces have never been more capable," Ms. Fraser said. "But until steps are taken to manage equipment readiness more adequately, these claims should be taken with a grain of salt."


The report listed a number of disturbing examples of declining readiness, including vastly reduced maintenance for navy frigates, a five-year delay in repairing a serious problem with the Auroras‘ flight instrumentation and a shortage of operable army vehicles. Canadian mechanics were also forced to borrow batteries from the Spanish Air Force to keep CF-18 jets in the air during the conflict in Kosovo.

In one example, she cited shortages of operable vehicles that meant army drivers were going to peacekeeping duty in Bosnia without proper training.

This is what..the fourth major report in the last few months that says the same thing?

I recommend sending an email to the opposition parties Defense Critics - I sent one to Leon Benoit.

Does the Liberal party know how much the military despises them? Does the Canadian public does know?

Our Navy (still referred to as "troops" and "soldiers" by the government and media) steams valiantly to fight a 3rd World landlocked nation, which apparently is a good neough commitment. And the US is stationing troops on our border....

When‘s the next election???
The next election should be in 2004 or 2005, if my memory serves correct. It depends on whether or not they decide to go in for the extra year or call the election early. Chretien has implied that he will step down in 2003 (his 30th or 40th year in politics, I can‘t remember offhand) but I‘ll believe that when I see it.

AG‘s have blown the whistle in the past. Whenever this has happened there have been serious behind- the-scenes efforts to get them fired. Given the "don‘t worry, be happy" and the "toe the line or else" approach of the Chretien Liberals, this AG really stuck her neck out. It‘s a shame because she‘s doing exactly what she‘s supposed to do.
I‘m afraid you boys will have to get used to, at the very least, another Liberal term. There is no way they will be replaced in the next few years with the Right completely split the way it is now (Day‘s probable replacement is distancing the Alliance from the Tories even further). Let‘s hope next week‘s budget takes the funding situation a little more seriously.
The Chretien Liberals are in a power position that is pretty much as close to a dictatorship as a democracy can get. They are in government because they‘ve won elections, and because they‘ve consolidated their majority by Senate appointments, they can effectively do as they please. Couple this with the fact that if you don‘t toe the party line you‘re out of a job it creates the illusion that they‘re unified and have their **** together. Many people actually buy into their "don‘t worry, be happy" approach - something that baffles me to no end.

With the right being as split as they are, the Bloc only representing the interests of a single province and the NDP (no comment required there), there‘s not much of an effective opposition. I think the right also has a real image problem to contend with, especially in Ontario and Quebec. The Alliance (and the Reform Party beforehand) was constantly being portrayed as the boogyman in the Toronto area during the last two elections for a variety of reasons. The noticable regional slant that they had in the past has lessened, but a lot of folks here still need to be reassured of that. On top of all of this, the people of Ontario are notorious for "brokerage politics" and the Liberals use that approach regularly - they buy Ontario votes.
Originally posted by King:
[qb]... since it comes from the government appointed watch-dog and not the opposition or a university professor it should mean more.[/qb]

Actually, the CD Howe Institute is not affiliated with the government. It is an "independent" think tank.
Actually, the CD Howe Institute is not affiliated with the government. It is an "independent" think tank.

My mistake. I was thinking of the Auditor General when I wrote that.