Saturday, June 5, 2010

Small ones, big ones and outright whoppers

Gordon Campbell's biography at his BC Liberal website claims that "B.C.’s job growth is leading the nation." That would be admirable, were it true. Statistics Canada reports that British Columbia employment growth ranks ninth out of ten provinces during May 2010. On year over year performance in job creation, BC ranks fifth.

Maria Byland
When Liberals want advertising to feature "ordinary people" who support their policies, of course they turn to the reliables. After exhausting the supply of business allies and lobbyists, that means using friends and relatives. Of the 25 pro-HST videos published at a government website, only three are women. (Not surprising since Liberals usually have a deficit in appeal to female voters.) All three women selling the tax have direct Liberal connections. According to a search result at Elections BC, Patsy Hui donated $5,000 to the Party. Irmi Critcher is a Liberal appointee to the Investment Agriculture Foundation of BC and Maria Byland, with husband John, is a long time friend of Ben Stewart, the Liberal Minister responsible for the Public Affairs Bureau (PAB). John Byland says he has been friends with Stewart since they were boys.

Now, Liberal clowns are preparing a media campaign to sell HST, beginning as soon as the Initiative Petition process has completed gathering signatures. Expect to see more friends, relatives, lobbyists employed by business groups and consulting economists grabbing a quick buck. They will tell us why HST is wonderful for everybody and how consumers should feel privileged to relieve business from paying taxes because higher profits are good for rich folks.

The irony of the campaign will be that the people who pay for this publicity will not be the ones who benefit by the tax transfer, it will be the ordinary citizens who are screwed by it.  They invite you to stand in front of a firing squad and want you to pay for the bullets.

The Liberal Government hired Jack Mintz to estimate new jobs in the decade following implementation of HST.  I previously noted that Mintz has been a long time business apparatchik, champion of business tax reductions, privatization, free trade and globalization and opponent of public pensions and social programs. His report is suspect from the start. As economist David Schreck writes at Strategic Thoughts, there is a paucity of good research supporting HST in British Columbia at this time:
"There aren't any surveys of large numbers of economists, and, much more importantly, there is little quantitative work on the effects of a value added tax. Studies cited by the Campbell government are either full of statistically insignificant results (Smart et al) or contain numbers that can't be replicated because they don't specify a model or the estimation techniques used (Mintz). What is clear is that even economists who support the HST admit that it involves a substantial tax shift from businesses to BC families. That is why the argument fails to convince voters that it is a "good" tax."
Dr. Schreck is pointing at the outright whopper. This major change in tax policy, one that transfers more than $10 billion in tax burden away from business during the initial term of the Tax Coordination Agreement, has not been discussed, examined or studied in any serious and comprehensive fashion.  How much of the tax savings will be gained by commodity exporters selling at world prices? Will those tax savings be exported for re-investment elsewhere? With the large proportion of imported consumer goods, will price levels change for most products?

These questions and more should have been addressed before legislation was drafted. The Liberals have taken a giant step based solely on the ideology. As goes the old refrain, "What's good for General Motors is good for the country."

Gordon Campbell says, "What's good for multinational mega-corporations, is good for me."
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1 comment:

  1. Interestingly, if I remember correctly, not that long ago Jack Mintz was commissioned to do an analysis of the effect/desirability of an HST for Ontario. In that case his clients, or those who paid him for the study/expertise, must have been opposed to an HST. So amazingly Mr. Mintz's conclusions were diametrically opposed to what his findings were at the behest of the Gordon Campbell Gang (who themselves were supposedly opposed to an HST prior to and during the last so-called election).

    It would appear that Mr. Mintz's expertise is so wide ranging that he can come up with whatever conclusions you are willing to pay for, as long as you make it clear what findings you prefer, in advance.

    I don't think the circumstances of the world changed in a couple of years, or that Ontario is on a different planet than B.C. where different economic realities apply - it would seem more likely that Mr. Mintz is little more than a whore who knows his own prosperity "lies" in pleasing the John (or the Gord or the Colin)!

    ReplyDelete

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