Flarethy's Bomb Before the Holiday

Right before holidays is usually the greatest time to dumb documents that you don't want to know about. Our Finance minister follows suit with this bad tradition, and dumb the bomb that Canada isn't going to increase health care spending by 6% every year after 2017. Now for many people (including me) we all speculated even during the election that the Conservatives weren't going to increase health care sending by the same 6% like Paul Martin did. The Conservative platform barely had a page on this issue. And the paragraph that is was written on was barely worth the paper it was printed on. It had the most ambiguous promises. Like

we will work collaboratively with the provinces and territories to renew the Health Accord and to continue reducing wait times

 By the way when Flaherthy announced this "Six of them (premiers)  lined up to speak out against the decision, citing a lack of negotiation with two years left to reach a new agreement. The Conservatives love doing terrible things before a holiday break in the hope that no one will notice, but this issue won't go away Harper. This Health Care debate is going to go on till 2017.
The current Health accord increases health care spending by 6%. Jim Flaherthy says he will increase health care spending by Nominal GDP meaning take inflation and add it to GDP growth, and Flaherthy says 3% increase is the minimum increase. 


Flaherthy answer is taking us for fools by saying Health care spending will increase every year. Yes it will but the rate of increase counts! If you spend one dollar more every year on health care then yes health care spending will reach records every year, but the provinces will need more than low increase in spending to reduce waiting times like the Liberals did in 2004 and it worked! Thankfully the 6% will stay till 2018.


Now I agree we do need to think of spending over the long run. I think that our government should look at preventing people from even needing a lot of health care. By taxing junk food and fast food chains the, looking at a national policy to stop obesity etc.. if  we do this the amount of people who will need our health care system will decline and will lower waiting times. If our goverment did this then a MINOR decrease in rate of spending would make sense. Increases like 5%-4%, because wait times will be reduced by the policies mentioned above. So what Flaherty is doing isn't bad ONLY as long as he puts policies to reduce waiting times like the ones mentioned above and our Finance minister isn't.


P.S Flaherthy plan to link health care spending to growth and inflation is good idea, but it seemed like it isn't being forced on the provinces without much compromise. 3% increase in Health care spending is fine as long as prevention is taking care of reducing waiting times. If we battle obesity and tax bad food and have a healthier Canada our Health care system won't need 6% increase every year. 

What Cuts?

The Conservatives are planning to find 4 billion in permanent cuts to try and balance the budget. The Only problem is do we see these cuts in the deficit? No the way this government works with finances the deficit isn't going to get better. First the Corporate tax cuts that they are reducing again is going to cost billions more than 4 billion. Add that with the Billions the Harper government is giving Quebec (even though we really need a bridge) this government isn't at all fiscally responsible for cutting spending. Because like the Republicans in the U.S yes cuts do help cutting the deficit, but the right is fixated on cutting taxes and assume that it is free. If you cut 1$ in taxes and cut 1$ in spending guess what the deficit ain't changing. What would have been fiscally responsible of the Conservatives would be to cut more than they reduce in corporate taxes and maybe not cut corporate taxes! considering they are already low enough. We can save 10 billion in catastrophe spendign not passing Harper's stupid "on crime bill." The Conservatives are bad with money and they always disproportionally put the deficit on the poor. 4 years from now the Conservatives will be saying the reason there is a deficit is, because of too much money on social programs. Even though this government is cutting social programs left and right, and will be for the next 4 years. If this is all Harper has planned to balance the budget there will be a deficit in 4 years and it will be, because of reckless spending on useless prisons, fighter jets and Corporate tax cuts. So the question I have for Harper is what cuts are you really making to the deficit?

Another Stimulus?

With more fear with the stock market some people in the U.S have been asking for another stimulus or spending package. Although putting money into the economy will create jobs the U.S can't afford it! Debt to GDP ratio is at 98%. The U.S doesn't have much wiggle room right now to lower taxes or to increase spending without paying for it. The U.S needs to reduce spending and raise taxes in order to lower the deficit. If the U.S doesn't reduce the deficit then it can face future downgrades, and will increase the interest of the debt. the Interest on the debt this year for the U.S is 200 billion and growing. With more downgrade and more stimulus that number will get bigger and force future cuts to be more sever and taxes to be raised more heavily in order to balance the budget. In 2020 under current projections the Interest on the debt will explode and be more expensive than the military, medicaid and medicare, and almost the exact same as social security. Another stimulus will make things harder in the future. The first stimulus wasn't all good either their was not enough spending on infrastructure and construction, and most of all it wasn't planned to be paid for. The Stimulus did create jobs and things would have been worse without it, but the U.S has no money or room to take any more cash for another stimulus. The U.S should invest in infrastructure and should extend the unemployment benefits , but this time they should pay for it. They need to have a plan that will eliminate the deficit all together within 7-8 years, and then if they want to spend any more they should have a new tax or cut to pay for the new spending. Stimulus season is over! The U.S made over 200,000 jobs last month in the recession they lost 700,000 a month in 2009 a stimulus made sense now not only is the U.S making jobs, but making another stimulus will make the deficit hard to handle .This May be an economic slowdown and the U.S might not employ to many people this month, but they are moving (slowly) in the right direction. the U.S may have to deal with sluggish employment for a while if they want to avoid being Greece!

Wow Republicans !

Last few years when the Dem's held both houses the Republicans stood united against almost every single thing the Democrats proposed. The Republicans now are somewhat divided in passing Boehner plan. It seems the curse of being the party in power has now been caught by the Republicans. The Republicans see that it is harder to be the party that has to actually make decision rather than to be the party that just votes NO! The Republicans have no big plan. I am slightly disappointed in the Boehner plan. Nine hundred somewhat billion over a decade is actually just 90 billion a year. The deficit is now 1.2 trillion and will only get as low as 600 billion in a few years then get even worse later on. This plan is maybe a baby step. I still would disagree with this bill as it is just cuts important programs and there are no tax increases. At least Reid's plan is twice as big and for that matter still has no tax increases. I still don't support Reid's plan as it would just be 200 billion a year which is a good start, but not enough, but we could close the rest of the deficit putting the taxes back to there 1990 levels. Where Clinton who also faced a deficit made tax increases and payed record amounts of the debt. It's funny Ried has a plan twice as big in just cuts while Boehner has just 900 billion. No wonder it he kept delaying his plan multiple times his plan is a joke. Even Bachman is against the bill, and the tea party part of congress is also very much against it. I am glad now to see the Democrats are united. To be quite honest we need to reduce entitlements, by increasing the medicare age and the retirement age to 70, while also stopping the Bush tax to all, end the mission in Afghanistan and Iraq, eliminate subsidies to big oil and finally pass bowl Simpson plan which will reduce the corporate tax rate and eliminate loopholes and increases revenue.

update: I support the Bowl Simpson plan, but I think we should eliminate loopholes and reduce rates only a little or nothing, because the U.S needs to balance the budget, but for a compromise I would agree with reducing corporate tax rates by 7% while eliminating loopholes, even though my ideal situation is eliminating all loopholes and no change to the tax rate.

Cut, Cut, Cut

Stephen Harper would like to cut 4 billion dollars in spending in order to help balance the budget. knowing Harper these cuts of course attacks agencies he is against like Environment Canada that will be getting a 21% cut this year. which is over 220 million dollars in cuts. Now I am all for balancing budget's, And I support cuts, but I think we need shared cuts around the board. The cuts should of course depend on the countries priorities. The Conservative Priorities are represented quite nicely under the current cuts. Cut Statistics Canada, Environment Canada, Natural resources Canada, the Royal Canadian mounted police. It seems that these cuts effect agencies that Harper doesn't like a lot. In fact one of the biggest agencies that are getting the cuts is of course Environment Canada which as I said is getting cut by more than 20%. Most of the cuts are climate change research and scientist. The parts of the budget that is getting more money is of course correctional services which don't need any more money as are crime rates are already low, and are rehabilitation rates are very good. This money is just really going to build more prisons. OOh! I know where Harper can find billions of dollars in cuts and he won't need to cut important agencies like Canada' Research council. He could just cut 10 billion in mega prisons and another 30 billion in jets. We can also put the corporate tax rate at 18% and more than balance the budget, so we can put in policies like national Day Care system, or a National Pharma care system. Or just Maybe make all the family tax cuts promises Harper made to voters during the election. It seems Harper's priorities are already made.

1. Big Corporations
2. Prisons
3. Jets
......
100. Hard Working Canadians
....
125. Health care
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Last: Environment