Deficit of debate

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This article was published 28/09/2019 (2491 days ago), so information in it may no longer be current.

Excerpt from Understanding the Manitoba Election 2019: Campaigns, Participation and Issues, edited by Royce Koop, Barry Ferguson, Karine Levasseur, Andrea Rounce and Kiera Ladner. The free ebook, produced by University of Manitoba Press, will be launched on Sept. 30 at McNally Robinson. It is available for download at: https://uofmpress.ca/election2019

A spectre has been haunting Manitoba politics — the spectre of deficit reduction. This election cycle, both of Manitoba’s leading political parties campaigned on a promise to balance the provincial budget by 2024 or earlier. Though balancing the budget may seem like an uncontroversial, common-sense campaign promise, it necessarily reduces the space for ambitious campaign promises in the name of fiscal restraint. I posit that even though politicians frame a balanced budget as a politically neutral action, this policy is the foundation of a right-wing agenda which has been embraced by the Progressive Conservative Party and the New Democratic Party, despite the otherwise progressive rhetoric of the latter. To their credit, the federal Liberal Party ran a successful campaign in 2015 in part by committing to not balance the budget, but instead promising deficit spending to spur economic growth. I do not argue here that financial realities do not, nor should not, matter to Manitobans and their elected representatives. Rather, I hope to question the political rhetoric that is often posed as so obvious that it is beyond debate.

The logics of deficit reduction and fiscal responsibility have been entrenched in Manitoba politics through both concrete legislation and political rhetoric. Manitoba was one of the first provinces to introduce strong balanced-budget legislation in 1995 under Gary Filmon’s PC government. Though it was later relaxed by the NDP, and then suspended following the Great Recession in 2008, balanced-budget legislation was reintroduced by Pallister’s PC government as the Fiscal Responsibility and Taxpayer Protection Act in 2017. Coupled with legislation, the legitimization of deficit reduction can also be explained as a product of the centrist nature of Manitoba party politics, as identified by Jared Wesley. The neo-liberal tide sweeping Western governments captured political space in the electoral centre, and by the late 1980s and 1990s PC and NDP policies in Manitoba had converged on the values of government transparency, efficiency, tax reductions, and balanced budgets. The NDP’s acceptance of these values represents a rightward shift away from the progressive centre, despite their positioning as Manitoba’s centre-left party.

Prioritizing balanced budgets lends credence to the concern created by the PCs of a province with unsustainable debt, looming credit downgrades, and an economy in decay and decline. The Pallister government successfully ran on an austerity platform in 2016 by misrepresenting the health of Manitoba’s economy and trying to frighten Manitobans about the future of the province’s finances. Manitoba’s economy had, in fact, grown every year between 2000 and 2015, except in 2008 (due to the recession), although even then Manitoba’s GDP shrank the least out of all the provinces due to our generally diversified economy. Early into the Pallister government’s first mandate, researcher Lynne Fernandez observed that the rhetoric that Manitoba’s finances needed “fixing” and “repairing” was working as a cover to justify impending funding cuts to municipalities and the public sector. The PCs ran a similar campaign this election cycle, stressing that the province is getting its finances on track as long as the government continues to exercise fiscal restraint (coupled with the promise of tax cuts and the elimination of certain taxes).

Ideologically, it makes sense for a conservative party to pursue an election campaign based on deficit reduction and tax cuts. However, the NDP’s prioritization of a balanced budget above any more socially responsible campaign promises demonstrates that, despite their differences, there is a fundamental similarity between Manitoba’s two major political parties. When PC leader Brian Pallister promised to balance the budget by 2022 during a televised leader’s debate, modifying the PCs’ earlier promise of balancing the budget by 2024, the NDP response was tepid. NDP leader Wab Kinew raised concerns about what the PCs would cut to meet their new timeline, but he did not call the goal of deficit reduction into question, instead framing the NDP’s plan to balance the budget in four years as the more realistic option.

The lack of political push-back to the goal of balanced budgets is especially troubling at a time when Manitobans want, and would greatly benefit from, increased public spending. According to polling done by Probe Research, 62 per cent of Manitobans support increased government spending on services even if it means running a deficit for longer. Climate change strategies, especially upgrades to municipal infrastructure and the expansion of public transit, will require ambitious government spending. Reversing the unacceptably high rate of child poverty and Indigenous child poverty in Manitoba will require government spending. Protecting and expanding existing public services such as health care and education will require government spending. Improving income assistance so that those who require it can meet their needs and maintain a good quality of life will require government spending. As this election cycle demonstrated, the dogma of deficit reduction and fiscal restraint works to limit the political possibilities available to us all.

Born and raised in Winnipeg, Shreya Ghimire is currently completing her master of arts degree in political science at York University. Her areas of research are in Canadian political economy, Canadian aid policy, and gender and development.