Roundup: Spinning deficit financing

It should be no surprise that a government that likes to re-announce the same funds over and over again are now re-spinning old funds with a new purpose. As previously discussed, they’re going full-speed ahead on rebranding their childcare benefits as economic stimulus – because apparently only families with children should be stimulating the economy. (Singletons, we’re being shafted – again). As well, Scott Brison noted that these cheques are essentially being deficit financed, after the budget raided both the contingency reserve and the EI fund to pay for them while still claiming balance (not to mention their projections for oil prices). And hey, you know what would be a good thing during a recession? A full contingency reserve and an EI fund that’s ready to help any layoffs and job losses that result from said recession. But things were going to be rosy, and there was nothing to worry about – except now there is, but Harper insists it’s all external factors (never mind that he still takes credit when things go well even though it had nothing to do with his government). What great economic leadership…

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Roundup: Cheques doing double duty

While former Parliamentary Budget Officer Kevin Page says that if we go into a technically recession, it should be contained as there is still growth in other sectors beyond oil and gas, Pierre Poilievre has been out spinning yet another tale over the weekend. Not content to show that the universal childcare benefit cheques due in the mail this month are nakedly partisan attempts at vote buying (and those of us of a certain age will remember when Ralph Klein would send out cheques to help Albertans pay for the cost of natural gas conveniently as elections were around the corner), Poilievre has ensured that the cheques get a second political purpose – they are now to also count as economic stimulus. Which of course they would be – but not very much, according to Don Drummond. As well, the government keeps saying they’re making all of these infrastructure investments, but the vast majority of them are still years down the road, and their Canada 150 infrastructure programme is going to be very small-time, and is also unlikely to have much in the way of lasting economic benefit. So we can expect these kinds of talking points to be repeated ad nauseum for the next few weeks as the campaign heats up, and until we get the numbers from StatsCan on September 1st as to whether we’re in a recession or not.

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Roundup: The R-word

With all of this bad economic news coming out lately, the R-word has been bandied about – recession, or technical recession, in the event that we get two quarters of negative growth. After all, we had negative growth in the first quarter, and we’ve already had one US bank say that we’re headed for recession and a 77-cent dollar (note: This was misreported as a 70-cent dollar the day before yesterday). Oh, but don’t worry, Joe Oliver says – we won’t go into recession. His forecasters still show growth, and Harper insists that the oil patch is going to bounce back, while they send out MPs saying that certain sectors of the economy are going to do better with a lower dollar – except no, the manufacturing sector isn’t ramping up on a lower dollar this time because that burned them before, and they had already retooled a lot of their operations to service oil and gas demand rather than export demand. So there’s that. One also can’t help but be reminded of the 2008 election, when Harper insisted that if a recession was going to happen, it would have happened already, and hey, look at all of these great buying opportunities. And then the “Great Recession” happened (a ridiculous name considering that the recession in the early 80s was actually worse), and the government drove us into deficit with a badly planned stimulus programme. Now that the campaign has begun, all of the leaders are plugging their messages – Harper insisting that things are going to bounce back and hey, look over there – terrorists!; Mulcair talking about manufacturing jobs without saying how he’ll encourage them (that miniscule innovation tax credit isn’t going to cut it) while also falsely decrying that “all of our eggs” were in the resource basket (not even remotely true); while Trudeau is making points about the current way the government is treating the economy and environment in an oppositional framework when it needn’t be, and talking about ramping up infrastructure spending but also trying to be clever about how to do it without more deficit spending. We’ll know by September 1st if we’re really in a recession or not, but it could make for a long two months of campaigning on the economy in the meantime.

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Roundup: Preparing to change gears

Today may be the final day the Senate sits – we’ll see if the Liberals are able to tie-up the “union-busting” bill C-377 in procedure for longer than it has been illegitimately time-allocated for today. From that point on, with business out of the way, it looks like senators can spend the summer focusing on some of the more managerial aspects of what has been going on with them of late, being the Auditor General’s report and his recommendations, particularly with regards to the independent oversight committee. It’ll be a tricky thing to get right because the AG did not contemplate the issue of parliamentary supremacy, but you can be sure that there are a number of senators who won’t be silent about that particular issue. It will also be a summer of fending off smears and attacks from MPs trying to use the Senate as a punching bag in their bid to get re-elected – never mind that a few incidents of alleged misspending have nothing to do with the powers or legislative business of the Senate, or the fact that MPs are far more opaque about their own spending practices. To that end, Senate Speaker Housakos told Bob Fife over the weekend that he’s not going to take any lessons on accountability from MPs, and most especially Mulcair with his party’s $2.7 million satellite office issue. And that’s exactly it – MPs aren’t saints by virtue of having been elected, and it doesn’t mean that they are really held to account for those issues because they are rarely brought to light. Witness last week, when the Ottawa Citizen asked MPs about their residential claims, and only 20 out of some 300 actually bothered to respond. Oh, but it’s the Senate that has the problem and with the “entitlement” issue.

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Roundup: Getting out the leg irons

It was the image that launched a thousand attack ads – or probably will, at any rate, as Dean Del Mastro was marched out in handcuffs and leg irons, off to spend the night (at least) in an Ontario prison after being found guilty of breaking election finance laws. “Cheating is cheating,” the judge noted, and that it was a serious enough crime to warrant some kind of jail time, so she decided on a month – though he may get out by tomorrow on bail pending the appeal of his case. Del Mastro’s lawyer also tried to get other exceptions for Del Mastro – jail on weekends, numerous exceptions for the eventual house arrest provisions – because he has a farm and needs to feed the animals, and a job in Toronto, and so on. The judge didn’t appear to be buying it, and made a point about needing a jail sentence onto only to show the severity of the crime (hence denunciation and deterrence), but also the issue of time to reflect on his actions, thought may be asking a lot from Del Mastro, as he walked into the courtroom convinced of his own innocence, and has shown no remorse whatsoever, even though the judge noted that Del Mastro was prepared to falsify his own statements to try and get away with his overspending. Many will argue that leg-irons and jail time are overkill, give that he’s not a dangerous criminal, but it relies on the same logic behind putting white collar criminals behind bars as well – because making them pay a fine or just house arrest aren’t considered punishment enough for the severity of their crimes. Disagree with it all you want, but we have made this choice though our legislative regimes, and if we want to change that, well, there’s an election coming up. Meanwhile, Stephen Maher says the Conservatives’ treatment of the man who testified against Del Mastro leaves a lot to be desired.

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Roundup: Some laudable goals, and a lead balloon

The writs might as well have been dropped for the kinds of campaigning that was going on yesterday – Trudeau in Ottawa, and Mulcair in Toronto. While Mulcair largely reheated past statements about support for the manufacturing sector (not that he spelled out what that support means) or lowering small business taxes (of the kind that could actually help out whose wealthy Canadians who incorporated themselves for tax reasons), it was Trudeau’s package of announcements that got the big play. The package included 32 measures for “real change” to bring more openness and transparency to government – a familiar song and dance, but there were some pretty laudable concrete proposals in there, around things like Access to Information, improving service standards at CRA, or repealing this government’s “fair” election laws. The part that got everyone talking – and my head exploding repeatedly – was Trudeau signing onto the electoral reform bandwagon. While Trudeau was talking about consultations and then legislation within eighteen months, the fact that he’s buying into the completely and demonstrably false notion that votes don’t count under our current system (in fact, they not only count but all count equally) is disheartening – particularly after he spent his leadership campaign talking about how he didn’t believe in PR systems (as opposed to Joyce Murray, where that was a central plank for her). Without turning this post into a denunciation of electoral reform, let me simply say that it’s false to say that votes don’t count now, and that changing the system will simply replace one set of problems – or perceived problems – for a whole new set of problems. There were so many other laudable proposals in his platform, one or two duds excepting, that it’s too bad that this one particularly bad one sucked the air out of the rest of it all. If he want’s “evidence based policy,” then perhaps he should reconsider this particular promise. Paul Wells writes about the earnestness of it all, with some historical perspective for good measure.

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QP: Misrepresenting the AG report

Though Harper was off in the Baltic Sea visiting our frigate there, the other leaders were in the Commons for another QP running on fumes. Mulcair led off, flirting with libel with his assertions about the AG report on the Senate — grossly mischaracterising what was found. Paul Calandra reminded him that the non-partisan House Administration found problems with their satellite offices, and that he should repay them. Mulcair wanted Harper to take accountability for the senators he appointed, but Calandra repeated the satellite offices line. Mulcair then gave complete falsehoods about why Marjory LeBreton resigned as leader in the Senate, and got the same response from Calandra. Mulcair brought up Senator Carolyn Stewart Olsen and wondered about other senators who repaid expenses before the audit — which has nothing to do with the government. Again, same answer from Calandra. for his final question, Mulcair wanted the PM to ask the Pope to apologise for residential schools. Bernard Valcourt took this one, and gave some bland assurances. Justin Trudeau was up, and wondered about the Prime Minister’s 57 patronage appointments to the Senate as a lack of a desire for real reform. Paul Calandra said that Trudeau’s position made no sense, that he would appoint Liberals to appoint non-partisan senators. Trudeau gave a pitch for his plan in French, got derision from Calandra about relieving Liberal senators from the burden of having to attend his caucus meetings. Trudeau wanted the Prime Minister to end partisan appointments, but Calandra gave some broad-based derision of the Liberals in response.

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Roundup: A possible return to deficits

The Parliamentary Budget Officer gave his pre-budget analysis, and said that while the books look balanced this year, the government’s continued focus on tax breaks, spending announcements and the low oil price environment could mean heading back into deficit in two years – not too surprising really if you’ve been paying attention. Part of the fiscal breathing room the government is using right now is coming from their decision to freeze EI rates rather than let them fall to a level that reflects the actual unemployment rate, which sounds a lot like the kinds of things they used to curse Paul Martin for doing. And then there are the asset sales, such as all of those GM shares – possibly sold at a loss – that just pad the books in the short term. But hey, they can claim to balance the budget without raising taxes (err, except for all of those tariffs that they raised this year) and try and sell that as sound economic management going into the election. The actual numbers tell a different story, as we’ve seen, but hey, why mess with a narrative?

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Roundup: Legalism and homework monitors

Another day, another dissection of the rules of the Senate, this time with the revelation that nobody in Senate administration ensured that work got done when they paid out contractors that senators drew up. The defence maintained the legalistic hammering, to the point that lawyer Donald Bayne omitted one key phrase from the guidelines for Senators expenses: “Likewise, individual Senators must be conscious of the requirement to expend public monies prudently.” And really, that’s what’s at the heart of this trial – even if the rules themselves were loose, it doesn’t mean that it’s permission to go well beyond their intended use and purpose. It makes me wonder who should be checking in on the work of senators when they contract out services – should it be Senate Administration checking that speeches were written, and that research was conducted? Do they become the babysitters and homework monitors of the Senate? It’s a hard question to ask because you can only infantilise them so far before you start getting into problems. It’s even more problematic when senators’ policy work can take a wide variety of forms. This isn’t to say that there shouldn’t be some form of oversight to ensure that there isn’t abuse, but we need to keep in mind that these aren’t civil servants or functionaries. They’re parliamentarians, with all of the attendant privileges that comes with that, and that means something. It’s also one of the reasons why pundits opining that this is really a “trial about the Senate” bothers me, and that these “entitled” senators have “free reign to spend public money,” which is obviously not true. Questions were raised, particularly about Wallin but also Duffy, and things were coming to light, though it there may have been the intent to take care of it more quietly. None of it excuses what Duffy did, and the fact that he appears to have deliberately misled Senate Administration with the contracts he drew up, as he certainly appears to have done with his various and sundry claims. Is it the Senate’s fault, or do we blame them to absolve him of the personal responsibility? That should be kept top of mind as the pundit class makes their pronouncements. The Senate didn’t make Duffy do anything – he made all of his choices himself. Meanwhile, the daily behind-the-scenes look notes Duffy’s exit strategy, and here’s a profile of the courtroom sketch artist.

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Roundup: The problem with Duffy’s defence

Day one of the Duffy trial, and we saw two things – the Crown laying out a case, including a bunch of evidence that was made available to the media, that showed a pattern of abuse by Duffy when it came to the claiming of expenses, such that he was claiming per diems on the day his appointment was announced, never mind that he wasn’t even sworn in yet, and that he was using one contract to a friend as a slush fund for things the Senate wouldn’t pay out. The crux is common sense – no reasonable person would make these kinds of claims. The defence, meanwhile, is arguing that the rules were so loose that it’s not Duffy’s fault, and everyone else in the Senate is doing it. I have a problem with that because no, everyone else is not doing it, and it breaches the good faith that Duffy should have been exercising from his office. Much of it stems to the very fact that Duffy should never have been appointed as a senator for PEI, but when Stephen Harper made that decision, Duffy didn’t live up to his end of the implicit deal. In conversations that I have had with those who used to work in the Liberal Senate Leader’s office back in the day when they formed government, if they were to appoint someone who didn’t currently live in the province that they were to represent, they ensured that they had their ducks in a row beforehand. This meant that the person was told they were being considered for an appointment – and if they told anyone, that wouldn’t happen – but in the interim they had to ensure that they had the driver’s licence, health card, election registration, licence plates, the works – taken care of beforehand. In Duffy’s case, it would likely have meant selling his home in Kanata and ensuring he had one in PEI that he could access year-round rather than a summer cottage, while maintaining either an apartment or a small condo near the Hill as his secondary residence. It’s really a no-brainer, but Duffy apparently wasn’t able to comprehend that and allegedly looked for as many loopholes as he could to maximise what he could claim. Every other senator I have ever spoken to, including some very long-time ones, is aghast at that kind of behaviour, and they do their utmost to minimise what they claim. I am also dubious about this “conspiracy” to “force” Duffy to repay claims that he may have been able to make legitimately – but remember that there were always political considerations at play, and even if some of those claims were legal, they would not have been politically sound and Duffy should have known this from the start. His cries of victimhood ring hollow, but he looks to be set on trying to win the trial on pure technicalities. Nicholas Köhler has his observations here, while the Ottawa Citizen’s Gargoyle shows some of the behind the scenes moments from the day.

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