It has been calculated. If you take all of the copies of economist Don Drummond’s report, piled them in front of the Ontario Legislature and lit them with a match, the resulting bonfire would not keep us very warm.
But it is a warming thought. It would be the best use for the drivel that Drummond tried to foist on us. If Premier Dalton McGuinty was trying to set up a bogeyman to take the blame for some austerity measures, he found the perfect scapegoat. All we need now is to hear from opposition leader ‘Tiny Tim’ Hudak that he agrees wholeheartedly with everything Drummond says. That would put the cap on a totally ridiculous exercise. You keep expecting the Premier to announce this report is to show people what Ontario would be like if the Conservatives win the next provincial election.
The worst part of the entire fiasco was when Drummond brought up the tragedy of the Greek financial crisis. To mention Greece in the same breath as Ontario is a travesty.Ontario does not have a financial problem. Ontario has a total debt of about $240 billion and a gross domestic product of more than $500 billion. That is not much for 12 million people to handle. It is the equivalent of a family earning $50,000 per year and owing $24,000 for house, car, cottage and other long-term debt. Drummond’s TD Bank will let you borrow a lot more than that.
But suppose you want to pay down some of that debt? Would you fire the gardener and the garbage man and cancel the Globe and Mail so that you could reduce the debt? Or would you forego the family visit to Disney World this year?
And that is what Don Drummond and his friend Dalton McGuinty do not seem to understand. If you want to save money, if you want to pay down debt, you cancel the foolish and frivolous—you do not throw people on the streets and pay increased welfare.
And while we hesitate to suggest this, the province has an ace-in-the-hole that a family does not always have. A government can raise its own pay. It can go to its taxpayers and say: sorry folks but we need a bit more money. And very few would be mad about it if the government just put a surtax on the rich. It would be great if they paid their fair share for a change.
And while the government is at it, it could reverse the trend in corporate taxes. Over the years, Ontario governments have reduced corporate income tax by more than 80 per cent. It makes you wonder why they even bother collecting it. If a business needs its profits to expand its business or to do research or hire more people, that is okay. The company that wants to send its profits off-shore or to buy its competition should be taxed to the hilt.
As you can see, there are options.
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Copyright 2012 © Peter Lowry
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