federal government spending
The Conservatives should be commended for sticking to their commitment to the balance budget. But balancing the budget cannot become an end in itself or it can come to serve as a justification for spending increases with limited economic benefit. Reducing personal income tax rates and capital gains taxes would be a productive use of future surpluses.
Allegations of expense scandals in the Senate have shocked many Canadians and rightfully so. Although unsettling, such antics are not an isolated case; they are part of a larger institutional problem with government.
The contrast between the highway in New Brunswick and British Columbia is symbolic of how the federal equalization program allows recipient provinces to provide above-average benefits at the expense of taxpayers elsewhere, even to "over-equalize" in some cases.
Can government really deliver? Evidence suggests the answer is a resounding "no." This is plain to see for anyone who peruses the catalogue of reports from Canada's Office of the Auditor General, an independent federal body charged with reporting to parliament on the performance of various government programs and initiatives. We did just that -- and it's not a pretty picture. It's hard to imagine a private company staying in business for long if it behaved this way. But therein lies the problem. Unlike a private company, a government can't go out of business. And government typically operates in a monopoly environment protected from competition so the consequences of mistakes and inefficiencies tend to persist.
The recent announcement by the federal government that it will fund Toronto's subway system is not good news for Canada. It means more of the same style of infrastructure funding we have always had. Instead of predictable, reliable and rules based projects, Canada is riddled with a mish mash of almost completed and almost dead projects politicians pick and choose to save (or not).