08/31/2011 02:40 EDT | Updated 10/31/2011 05:12 EDT

Bob Rae Slams Tories' Economic Management

OTTAWA - Bob Rae won't let his controversial record as Ontario premier stop him from lambasting the Harper government's management of Canada's flagging economy.

The interim Liberal leader said Wednesday he knows full well the Conservatives will try to deflect criticism of their handling of the economy by pointing to his term as premier during the recession in the early 1990s.

But he said he's prepared to stack his record against that of the Tories any day.

"If you want to compare records, you want to compare statistics, you want to compare experiences, bring it on," Rae said, thumping his podium for emphasis.

"I'm ready for it."

Rae was speaking at the close of a four-day Liberal caucus retreat to plot strategy for the Sept. 19 resumption of Parliament. Caucus members agreed their main focus during the fall will be the shaky economy.

Rae said Wednesday's GDP results showing Canada's economy contracted during the second quarter confirms the Tories are wrong to focus on cutting taxes and spending.

"The focus for the country, the focus for this government has to be jobs and not cuts."

He accused Finance Minister Jim Flaherty of "playing a kind of Pollyanna game," denying the possibility of a recession in Canada and insisting there's no reason to change course despite floundering economies in the United States and Europe.

He called on the government to delay its plans to slash $4 billion from annual spending and to roll back corporate tax reductions. And he called on it to invest in infrastructure programs and other measures that will help create jobs.

Rae said fiscal discipline is essential but has to be balanced in tough times with measures to stimulate the economy.

"Never will you hear from my lips the words that the debt is not a problem. Debt is always a problem. We also have to understand there are other problems."

He said the key to debt reduction is not simply fiscal restraint but also generating "strong revenues based on strong growth."

"That is what got us out of the mess we were in the 1990s."

The Conservatives delight in recounting that "mess" and laying the blame for it, in Ontario at least, on Rae.

Rae, then a New Democrat, took the provincial helm in 1990 at the start of a deep recession. His government racked up record deficits, which have since been eclipsed by the red ink piled up by other governments, including Prime Minister Stephen Harper's. It also imposed an austerity regime that required doctors, teachers and other civil servants to take unpaid days off, which became known as "Rae days."

In focusing on the economy, Rae acknowledged he's inviting the Tories to dredge all that up.

He said he's proud of his government's record in saving jobs, investing in social housing and starting subway construction in Toronto. And he said that's preferable to the record of the subsequent Conservative government of Mike Harris — which included current federal ministers Flaherty, Tony Clement and John Baird and which slashed social programs and ran up deficits even during a time of economic growth.

"That's the Conservative miracle in Ontario and it's why we don't want to return to it," Rae said.

"I'm not backing away from any fight with Mr. Harper, Mr. Harris, Mr. Flaherty, Mr. (Ontario Tory Leader Tim) Hudak, Mr. Baird, all of that group, all of the horsemen of the apocalypse," he added.

"I'm not going to disappear and not fight with them. We're going to have a real argument."