McFadyen has analysis deficit

Hey there, time traveller!
This article was published 02/09/2011 (5401 days ago), so information in it may no longer be current.

IF Progressive Conservative leader Hugh McFadyen thinks Manitobans will vote for a four-year extension of the NDP deficit-financing regime, he’s going to have to provide more evidence of the need than he produced at the photo-op he staged to launch his campaign Tuesday.

Mr. McFadyen says the NDP is hiding the true state of government finances and that the province is much deeper in the glue than we are being told. He says that a PC analysis shows that government spending and revenues are way out of line with projections, such that the target of a balanced budget in 2014 can’t be met without drastic measures. In fact, he says that the projections show that government spending will be $500 million greater than revenue in 2014, which will either add an additional $500 million to the $1.6 billion of deficits the government projects it will have accumulated by then, or, more likely, the government will increase taxes by $500 million.

Mr. McFadyen says that rather than see tax increases to tame the inevitable deficit, or $500 million in cuts to services, a PC government would continue deficit financing after 2014 for as many as four years and would use the time to grow the economy and reduce waste to restore fiscal balance.

To be sure, the NDP is capable of spin. In bringing down his last budget as finance minister, Greg Selinger declared that unlike other provincial governments hit by the recession, he had “chosen” to forgo a deficit and instead would balance the books for 2009-2010.

Well, that was so much hot air. By the time that fiscal year ended, Mr. Selinger was premier of Manitoba and Rosann Wowchuk was the finance minister who had to explain that the “chosen” balance had turned into a $500-million deficit, the first of five that were project to add $2 billion to the provincial debt.

So, sure, the NDP is quite capable of stretching the truth, but that doesn’t amount to evidence that the budget will be overspent by $500 million in 2014, nor does the little chart in a PC policy paper showing revenues and expenditures failing to meet in 2014.

Furthermore, if the situation is about to become so grim, why is Mr. McFadyen borrowing a page from the NDP playbook, promising tax cuts that can only be achieved with deficit spending?

It’s early in the election campaign. Mr. Mc-Fadyen has plenty of time to put some real meat on these bones.