Saturday, July 11, 2009

Harper Apologizes and Admits He's Wrong in the Same Week. Maybe Pigs Really Can Fly.

It's been quite a week for Stephen Harper. Communions, misquotes and 'dumb' remarks.

If he blamed bad food in Peru on his actions that caused the Parliamentary Crisis, was there something in the water in Italy?

Harper who never apologizes, actually said he was sorry to Michael Ignatieff, not for another venomous partisan attack, but for misquoting him.

Now, after calling the predictions and recommendations made by the Parliamentary Budget Officer, Kevin Page, dumb; he's admitting that he is wrong. (Now mind you, it doesn't mean he's going to take the advice of an economist with far more experience than him. That would be asking too much).

Flying pigs, flying donkeys, hell freezing over ... all three at once? There's definitely something going on here, and I've got to admit, I'm a little frightened. Just how bad are things?

Jul 10, 2009
Tonda MacCharles
Les Whittington
Ottawa Bureau

L'AQUILA, Italy–Prime Minister Stephen Harper has scrapped his government's controversial promise to stop running annual budget deficits in five years.

For the first time, Harper said today that keeping the government's pledge to balance Ottawa's books by 2013-14 will depend on how quickly Canada's economy recovers.

"We will allow the deficit to persist if necessary," Harper said. "We will not, in order to meet some timetable, start raising taxes and cutting programs."

Until today, the Conservatives had insisted they had a timetable to end deficit financing. Finance Minister Jim Flaherty had brushed aside critics who said the government's spending initiatives and massive tax cuts would make it impossible to return to budget surpluses by 2013-14.

But Harper told reporters after the G8 summit in Italy that the government won't be bound by that promise.

He said a recovery in the Canadian economy will be "well under way" by early 2011, which will result in higher tax revenues and lower expenses for Ottawa.

But "if the recession turns out to be longer than that, for example, or the recovery turns out to be shallower, then that will change the pattern of the recovery from the current deficit," Harper said.

The Prime Minister was responding to comments earlier this week by Kevin Page, the independent parliamentary budget officer, who said the government's budget deficits are so large that Harper could only balance Ottawa's books in five years by raising taxes or slashing programs.

The Prime Minister insisted that, even if government revenues are slower to recover than predicted, he would not hike taxes or cut programs. "That's a very dumb policy," Harper told reporters.

He criticized Page, whose fiscal projections he said were more "pessimistic" than most.

Page said this week that cumulative federal budget deficits in the next five years will reach a whopping $156 billion, half again as high as the Harper government has predicted.

Harper said the global economy is still fragile and he does not yet advocate winding down stimulus spending.

Despite having recently claimed that 80 per cent of the government's billions in stimulus spending is committed, Harper admitted today it is a challenge to ensure the money actually gets spent. "It's a reality that it is tough to get it out the door."

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