Dear editor
Jason Kenney’s budget cuts are frequently described as harsh, reckless and irresponsible or, as a recent letter to my local paper put it, “draconian and cruel”.
It’s pretty strong language.
So let’s put Jason Kenney’s first budget into perspective by comparing it to what other politicians under similar circumstances have done.
When Jean Chrétien, a Liberal, took over the federal government in 1995, debt was high and approximately one in three federal tax dollars were being spent on interest costs. Chrétien saw where things were headed and knew he needed to take action.
Back then Wall Street called Canada “an honorary member of the Third World”.
He and Finance Minister Paul Martin cut spending by 12 per cent over four years (1994-95 to 1998-99). And he too got called a lot of nasty names.
But he rescued us from looming insolvency.
“The debt and deficit are not inventions of ideology. They are facts of arithmetic. The quicksand of compound interest is real,” explained Martin in his 1995 budget address.
That arithmetic is just as real no matter what party you’re in. When Roy Romanow’s NDP government took power in Saskatchewan in 1991, their net debt was projected to exceed $10 billion and one in four dollars collected was going on interest. So those avowed socialists got busy cutting, reducing program spending by 14.4 per cent over five years starting in 1991-92.
Harsh? People said so.
But it was necessary and it worked.
Here in Alberta, when Ralph Klein took over the Progressive Conservatives, our net debt stood at $ 8.4 billion and we were spending an unsustainable $1.4 billion a year on interest (interest rates were higher back then).
Starting in 1993-94 Klein reduced spending by 20 per cent, and when he left office in 2006 Alberta possessed net financial assets of $36 billion – a $44 billion turnaround.
He too took a lot of abuse. And unfortunately a future version of the Progressive Conservative Party responded by loosening the purse strings again as soon as the crisis was past.
By the time Jason Kenney’s United Conservative Party (UCP) took office, years of misrule by Progressive Conservatives and NDP alike had left the province with currently $70 billion in debt and interest payments of around $2 billion per year.
In response the UCP is trying to reduce operational spending by a mere 2.8 per cent over four years, which amounts to $1.3 billion out of a $55 billion budget. And some people are having hysterics about Kenney the heartless slasher.
In my view he’s not cutting enough, as with a $1.3 billion reduction operational spending goes down but total spending goes up. Alberta seems to be in at least as bad fiscal shape as when Klein or Romanov took office, or as Canada was when Chrétien did.
Yet the UCP’s cuts are far more modest.
Alberta has been racking up debt faster than any other province and our finances are widely known to be a mess, hence repeated credit rating downgrades.
If you’re looking for negative terms for Jason Kenney’s current spending and debt reduction program, try demure and timid because it’s not draconian and cruel.
Stuart Taylor, Hinton
