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The PM and big, bad taxes

Posted by ealboim under All

Elly Alboim

The Prime Minister’s musings about there being no “good” taxes have led to a flurry of commentary, particularly in the Globe and Mail and its political blog site about whether he meant what he said and whether his words reveal an attitude towards government that is both cavalier and dangerous.

There is mounting evidence of cavalier decisions by this government. Yesterday’s snap decision to impose visas on Mexican and Czech visitors seems to be leading to potential devastating retaliation by the European Community. The snap decision to shut down the MAPLE reactors without a Plan B is taking on new meaning now that the Dutch reactor is about to shut down as well.

But it is the tax issue that may very well lead to the most significant debate .

The Prime Minister has embraced forever deficits, if need be, rather than accepting the “dumb” policy of raising taxes. There is every indication – including the cynical decision to cut the GST and the incessant characterization of the Liberals as “taxers” – that the PM believes Canadians (or at least HIS Canadian voters) are moved to vote by their distaste for current taxation levels. And most of the various commentators also start from a presumption that taxes are highly unpopular and electoral albatrosses.

But there is lots of public opinion research that suggests that most Canadians actually make the link between taxes and government services. In the years of surplus, reducing taxes consistently ran a poor third to paying down debt or spending on key priorities. Most people understand the power of pooling their dollars in order to accomplish important things. Most would forego what always turns out to be modest personal benefit (because significant tax cuts cost so much money when spread over 15 million tax payers) in order to better fund health care or improved educational facilities. Most believe government is the ultimate guarantor of the services they require.

And unless we suddenly and unexpectedly return to significant economic growth, this proposition is going to be tested once more as future government struggle with the vicious circle caused by chronic, structural deficits and mounting debt. We know Mr. Harper’s answer (or at least this week’s version.) The question for others is whether Canadians will accept increasing taxes rather than lose already weakening government services.

Ultimately, this may come down to choosing between alternate and profoundly differing visions of the role of government and the taxes that support it.

Elly Alboim is an Associate Professor of Journalism and provided strategic communications and public opinion advice on eleven federal budgets