In an ideal world elections would be about clear choices. Parties would agree upon the facts and let voters know the differences between what they and others would do. Unfortunately, in the real world a great deal of time is taken up arguing over the simplest of facts. Collin Hansen, BC's new Finance Minister, provided an example of that kind of mudding the waters when he appeared as a guest on Voice of BC with Vaughn Palmer on February 23rd.

Hansen was asked to respond to a graph which showed that real GDP grew at an average rate of 3.0% in BC between 1991 and 2000; putting BC in fourth highest position among the provinces. Hansen quipped that it took a few years for the NDP to slow the economy. Between 1991 and 1995, real GDP (1997 "chained" dollars), grew from $95.90 billion to $108.19 billion; that's average annual growth of 3.1%. Real GDP reached $125.15 billion in 2000; that's average annual growth of 3.0% between 1995 and 2000. Economists who are familiar with the revisions Statistics Canada makes to estimates of provincial GDP know that a difference of one tenth of one percent in real growth is not significant. Alberta's real GDP grew at 4.3% in both 1991-95 and 95-2000. Ontario grew at 2.8% in the early 90s and 4.8% in the late 90s. Quebec grew at 2.1% in the early 90s and 3.6% in the late 90s. Hansen's criticism seems to be that although BC showed steady growth throughout the 90s, Ontario and Quebec grew faster in the late 90s. He should be wary of that standard since his 2005 budget forecast real growth of 3.1% for BC this year and 3.0% for each of the next two years. In other words, his golden decade will do no better than what was achieved under the NDP, and by his standard he will have failed if Quebec and Ontario do better.

Hansen was also asked about the failure of tax cuts to pay for themselves. Revenue from personal income tax was $5.96 billion in 2000-01; it is forecast to be $5.06 billion in 2004-05. Hansen responded that cuts to income tax revenue are made up in part by higher sale tax revenues; he added that is true even after adjustments are made for the increase to the sales tax that was rescinded at the time of the by-election. Sales tax revenue was $3.63 billion in 2000-01; it is forecast to be $4.07 billion in 2004-05. The gain of $440 million doesn't cover the $900 million shortfall in income tax revenue (even without adjusting for population growth). Of course the Campbell government actually covered the tax cuts by increasing taxes and fees elsewhere. Total revenue from MSP premiums increased from $894 million in 2000-01 to $1.458 billion in 2004-05, a $564 million increase. Total revenue from post secondary tuition fees increased from $440 million in 2000-01 to $924 million in 2004-05, a $484 million increase. Gambling revenue increased from $562 million in 2000-01 to $842 million in 2004-05, and it is projected to grow to $$1.021 billion by 2007-08. "Contributions" from the federal government increased from $3.284 billion in 2000-01 to $5.174 billion in 2004-05. That's why government revenue increased even though tax cuts did not pay for themselves, but you won't hear the Liberals admit that as they campaign for your vote.