A liberal Conservative budget

The London Free Press
By Rory Leishman
With Tuesday’s budget, the Harper Conservatives have set quite a standard for fiscal extravagance by a supposedly conservative government.
As recently as 2006, the preceding Liberal government of former prime minister Paul Martin achieved a budget surplus of almost $14 billion. Who would have thought that within three years, a Conservative government would propose a budget deficit of almost $34 billion?
Granted, Conservative Finance Minister Jim Flaherty is not entirely to blame for this fiscal calamity. As he noted in the budget, the collapse in revenues and hike in expenditures caused by the recession would produce a $15.7-billion budget deficit next year, even if the Harper government were to retain all existing fiscal policies.
As it is, Flaherty has made matters much worse. By his own reckoning, the tax cuts and spending increases in his budget will produce an additional $18 billion in deficit spending next year and a cumulative $85 billion in total budget deficits over the next four years.
Like the Liberals, New Democrats and Bloc Quebecois, the Harper Conservatives now maintain that a vast increase in deficit spending is necessary to revive job-creating economic growth. There is no evidence for this pretence.
Indeed, there is better reason to believe that most of the additional spending proposed by Flaherty will only prolong the recession and retard future economic growth. Consider, for example, the $4 billion in “repayable loans” for Canada’s troubled auto sector. Anyone who thinks that money is likely to be repaid is dreaming in technicolour.
While in opposition, Harper and Flaherty decried the billions upon billions of taxpayers’ dollars wasted on failed corporate handouts by the Liberals. Yet now that the Conservatives are in power, they are doing the same. Among the bizarre items in the budget is a proposal to lavish $1 billion on a so-called Southern Ontario development agency.
The international record on government handouts to failing corporations is clear: More often than not, the state-directed payments serve only to postpone bankruptcy and joblessness, while diverting scarce investment capital away from more efficient, job-creating production.
Of course, there are some special cases: No responsible government would allow a major financial institution to go bankrupt in a way that would undermine the financial stability of the entire economy.
That said, the general rule remains: Prudent governments leave investing in private companies up to private investors subject to competitive market forces.
Prime Minister Stephen Harper used to advocate both sound fiscal policies and a stricter separation of federal and provincial powers. Now, his government proposes to spend billions of taxpayers’ dollars on a host of provincial and local projects such as a Highway 39 truck bypass in Estevan, Saskatchewan, and the revitalization of the municipally owned Union Station in downtown Toronto.
On Jan. 22, the Bank of Canada projected that the Canadian economy will resume growth by the second half of this year, and continue to expand at a brisk annual rate of 3.8 per cent during 2010. Under these circumstances, there can be no economic rhyme or reason to the $85 billion in deficit spending planned by the Harper government.
What, then, is the real purpose of such fiscal improvidence? The answer is evident: By this means, the Harper Conservatives aim to bribe voters and win support for their minority government from the opposition Liberals.
And sure enough, Liberal leader Michael Ignatieff has indicated that his party will back the Conservatives on the budget -- a deficit-spending plan so extravagant that it could have been designed by the Liberals.
Meanwhile, Harper’s conservative base has good reason to be increasingly fed up. So far, his government has done little to curb the judicial usurpation of legislative power; has opposed every initiative to safeguard the lives of babies in the womb; and now has introduced the most reckless budget since the Progressive Conservative government of former prime minister Brian Mulroney presided over a record deficit of $39 billion in 1992-3.
Mulroney’s liberal Conservatives subsequently went down to a crushing electoral defeat. Harper should beware: History can be repeated.

Hamas responsible for Gaza casualties

The London Free Press
By Rory Leishman
On Tuesday, an Israeli missile reportedly killed more than 40 people, including children, who had sought shelter in a United Nations school in northern Gaza. Who bears primary responsibility for this tragedy?
The answer is clear: It’s Hamas. With reference to the tragic deaths at the school, Canada's junior foreign minister, Peter Kent perceptively noted: “We know that Hamas has made a habit of using civilians and civilian infrastructure as shields for their terrorist activities, and that would seem to be the case again today."
It’s also clear that Hamas has brought on the entire conflict in Gaza by unilaterally renouncing a ceasefire with Israel on December 29 and unleashing hundreds of rockets on the tens of thousands of civilians residing in southern Israel. While few Israelis have been killed, who can blame the government of Israel for taking all necessary measures to stop this terrorism by rocket fire?
During a visit last July to Sderot, an Israeli town that has come under frequent rocket attack, president-elect Barack Obama observed: “If somebody was sending rockets into my house where my two daughters sleep at night, I'm going to do everything in my power to stop that. I would expect Israelis to do the same thing."
Indeed, the Israeli Defence Forces are now battling Hamas forces in Gaza for the express purpose of quelling the rocket attacks. And in doing so, Israeli troops strive to avoid the kind of civilian casualties that occurred at the United Nations school. Otherwise, the civilian death toll in Gaza would certainly be vastly higher.
In contrast, Hamas forces have long boasted of their deliberate targeting and killing of Israeli civilians with rocket attacks and suicide bombings. And the Islamist militants in Hamas have likewise made no secret of their ultimate aim to wipe the state of Israel off the map.
As a result, Canada has joined the United States, the European Union and other countries in listing Hamas as “a radical Sunni terrorist organization.” Canadians who take to the streets in explicit support of Hamas during the current conflict would do well to note that it is an offence under Canada’s Anti-Terrorism Act for anyone “to knowingly participate in or contribute to, directly or indirectly, any activity of a terrorist group.”
To justify rocket attacks on Israeli civilians, Hamas argues that it has no other means of opposing the economic blockade which Israel imposed on Gaza in June 2007, after Hamas forces crushed the secular Palestinian Security Force in Gaza which served the government of Palestinian President Mahmoud Abbas. Like the Nazis, the Islamist extremists in Gaza had no sooner contrived to win power in a democratic election than they undertook to destroy all legitimate opposition to their dictatorial rule.
Regardless, it’s not just Israel that has placed an economic blockade on Gaza. Egypt has done the same, and for good reason: Like other secular Arab leaders, Egyptian President Hosni Mubarak recognizes that the Islamist extremists who have seized power in Gaza are a menace to peace and stability throughout the Middle East.
What, then, can be done? Writing in the Washington Post on Monday, John R. Bolton, former United States ambassador to the United Nations, suggested that Israel abandon the idea of a two-state solution to the Palestinian dilemma and return control over the West Bank and Gaza to Jordan and Egypt. While there is much to be said for this proposal, there is little chance that it can succeed even with solid backing from the United States and the Arab League. The hard-pressed leaders of both Jordan and Egypt have made plain that they are no more eager than the Israelis to resume responsibility for governing the faction-ridden and violence-prone Palestinians.
The best conceivable outcome to the conflict is that Israel will drive Hamas from power and clear the way for restoration of the secular Palestine Authority in Gaza. Only in this way can the long suffering people of Gaza have any realistic hope of finally living in peace and freedom.