Strategic Thoughts

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September 15, 2003

Exposing Campbell's Myths

Apologists for the Campbell government are increasingly trying to divert attention from their failures by misrepresenting the 1990s and by characterizing the NDP leadership candidates as favoring increases in taxes and in public sector wages. Fortunately, the BC Progress Board is providing independent comparisons of the 90s and the Campbell Era. In its second report the Progress Board discussed the "combined tax burden" from local and provincial sources which includes income taxes, consumption taxes, health insurance premiums, contributions to social insurance plans and other taxes, including payroll taxes, fees for motor vehicle licenses, natural resources taxes, licenses and other miscellaneous taxes. The combined tax burden was lower for BC than Ontario and Quebec in every year from 1992/93 through 2001/02. From 1998/99 through 2001/02 the BC and Alberta "burdens" are almost equal. Contrary to the myth spread by the BC Liberals, BC already enjoyed low taxes before Campbell's radical tax cuts. What Campbell did was to shift more of the tax burden onto middle and low income earners by cutting income taxes disproportionately for the wealthy and then imposing almost $1 billion in increased user fees.

Working TV is providing Internet access to the leadership debates. The public can hear some candidates say that an NDP government makes no guarantee that it would not legislate strikers back to work, and can listen to them talk about the need for economic growth so as to pay for programs. Of course, it is easier for the government to campaign against false stereotypes than it is for it to defend its record.

The Campbell government said that tax cuts would pay for themselves. Before the election, economist David Bond said that would not happen, and now the hard numbers are showing that Bond was right. Many economists would have said that tax cuts might at least stimulate some economic growth, but the way the tax cuts were structured has resulted in BC remaining last in Canada. The Campbell government has been fortunate to reap the rewards for industry specific stimulation started by NDP Energy Minister Dan Miller. Oil and gas revenues from northeast BC will provide windfall revenues that may offset lost revenues due to failed tax cuts, but they will not change the shift in the tax burden from high to middle and low income earners.

At the October 24, 2001, staged cabinet meeting Neufeld predicted that BC would have an additional $16.2 billion in revenue from energy over the next six years. It looks like he may be right, which means there is no reason for the government to proceed with cuts such as the closure of hospital beds, cuts to child protection or reductions in the forest fire prevention budget. Doing so demonstrates that the government is mean spirited, ideologically driven and out of touch with the public.

 

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