Finance Minister Blaine Higgs seems to be using the deficit as an excuse to shrink government and cut public services. There is no other conclusion possible. If we simply paid the taxes we paid in 2008, we would pretty much slay the deficit. Instead, Minister Higgs wants to cut health care and education, and beggar social services, by what he calls "right sizing" government. He continues to behave as if we have a spending problem, when what we really have is a revenue problem.
The Liberal's decision to reduce income taxes for the well heeled in their 2009 budget got us into this mess. Their plan was to remove $325 million from the revenue side of last year's budget, naively assuming that the tax cuts would entice families and companies to move to New Brunswick,by growing the economy to pay for them. This obviously didn't work, but we have lost hundreds in millions in income we need to pay for health, education and social services.
How are we paying for these tax cuts? We borrowed the money to finance them. As a result, the Liberals created a structural deficit, and we have been piling on the debt ever since.
You would think the logical course of action would be to simply cut these unaffordable tax cuts, rather than cut health, education and social services. However, the Alward Conservative seem to be as ideologically committed to this reckless tax policy as the Liberals.
Most people realize you can't get something for nothing. If we want to maintain our health and education system then we need to return to the tax levels of 2008. We just need to pay our way. It makes good sense. But the Alward government says no. They prefer to perpetuate the fiscally irresponsible and ideological tax policy of the Liberals.
To listen to Blaine Higgs, one starts to get the feeling that he wants to use the deficit to force us to do things that New Brunswickers would otherwise not support. Our health and education systems, and social safety net have already been cut to the bone. Deep cuts in our health care system at this point could only lead to privatization. Deep cuts in our education system would force parents and teachers to pay more. Cuts in social services will only bring misery, forcing even more families to rely on the charity of food banks which are already stretched to the breaking point. And on the revenue side, a debilitating deficit strengthens the government's hand to impose fracking on unwilling rural communities in order to capture the royalties it promises will follow.
Does Premier Alward support this? Does he understand what is at stake? Or is he leaving his Finance Minister to pursue his own ideological agenda?
There is no such thing as a free lunch, in economics or ecology, it's just a question of who is going to pay the bills. The Liberals were happy to borrow the money to pay for their tax cuts on their ideological belief that lower income taxes would drive enough economic growth to eliminate the resulting deficits someday. As the Green Party said at the time, this was nothing more than magical thinking and would not come to pass, leaving us with a structural deficit to contend with.
By refusing to act now, to restore the tax regime we had in 2008, the Conservatives will pass the bills onto families who need health care, to health professionals and teachers already stretched to the limit, and to rural New Brunswickers who will lose the quality of their lives and their environment with the imposition of fracking.
The Green Party of New Brunswick thinks we should take the responsible course and bring back the taxes of 2008. We are not a rich province, yet we have the lowest overall taxes east of Saskatchewan. This is not sustainable and the government knows it. It doesn't have to be this way.