Sand in the Shorts: Time for the Sun to Set on Federal Transfers

The time has come for the federal government to let the provinces know that transfer payment growth has seen it's day. In bringing down the new(ish) budget today, the main areas of restraint can be found in the gradual elimination of the vote subsidy and the promise to find savings totaling $11 billion over the next four years within Ottawa's $80 billion operating budget. This will allow the deficit to be eliminated by fiscal 2014-15.

That's nice. But it just scratches the surface when it comes to reigning in runaway growth in provincial transfers in order to be prepared for increased healthcare spending as Canada's population ages. As it stands, the next five years will see the national debt stop growing and even shrink, ever so slightly. But if our current fiscal health is to last through the next 50 years, there needs to be much more done.

Right now the provincial governments as a whole are tending to spend like drunken sailors, with Ontario's massive $14 billion deficit merely leading the way. The problem is that even this level is reliant upon massive federal transfers. Partly this is a result of the muddled way of funding programs which has grown in Canada over the last 50 years. It is also partly a result of the system of transfer payments which were initially meant to balance services, but instead now allow Canadians in Ontario, BC and Alberta to subsidize superior levels of service in PEI, New Brunswick, and Nova Scotia.

These transfers, and the confused means of federal funding for provincial responsibilities, represent the single biggest drag on federal spending – and the single biggest excuse used by provincial governments to disguise their fiscal incompetence. The McGuinty government in Ontario gives massive pay raises to government employees, along with a $7 billion gift to Samsung which will supposedly bring all kinds of wind-power equipment manufacturing to Ontario – if the stars, planets, and galaxies align, the Maple Leafs win the Cup, and Ontarians are lucky beyond belief. Then it passes a budget with a projected deficit in the coming year of $11 billion. Why? “The federal government...”

Alberta has been doing the same, ignoring it's own mismanagement of oil revenues, abortive royalty increases in the oil patch, and out of control spending. Instead the blame is laid on Ottawa. The same can be seen in provincial capitals across the country.

The means to fix this system is fairly simple, though. It starts with the Ottawa getting out of funding programs such as health and education which are a provincial responsibility, and transferring the tax points which formerly funded these to the various provincial governments. The transfer payment system should be abandoned and replaced by a new one which covers just the most basic services, with adjustments being made to reflect relative cost of living and differences in costs to the governments of providing equivalent services.

For example, if the cost of hiring a nurse in New Brunswick is only 95% of the cost in Ontario, the transfers should be adjusted to reflect that. Right now it isn't, and as a result, the level of service found in a Charlottetown hospital is far superior to that in a Belleville hospital. A dollar simply goes further in some parts of the country.

The net effect of this would be to make clear to the voter precisely which level of government is wasting their tax dollars in a given area, and thus allow Canadians to vote accordingly. It would also mean the end of Ontario, Saskatchewan, Newfoundland, Alberta and BC subsidizing Quebec's grossly over-subsidized nanny state and general fiscal mismanagement.

And if we fix this system soon, maybe we'll be able to nurse our healthcare system through the next 50 years.

Persichilli: Harper and McGuinty called Quebec’s bluff - thestar.com

By Angelo Persichilli - from the Toronto Star

One of the most important axioms in Canadian politics was that nobody could win a majority government in Ottawa without winning big in Quebec. That axiom has now been erased.

The credit for calling the bluff on this self-serving rule goes to two people — Prime Minister Stephen Harper and Ontario Premier Dalton McGuinty.

This artificial Quebec veto on national majorities dominated politics for decades, branding francophone leaders as the only ones capable of winning majorities for their parties and keeping Canada united.

Prime ministers from Quebec have dominated Canadian politics for almost half a century because of this axiom. Lately this notion was strengthened because of the two back-to-back Conservative minority governments: “Harper will never lead a majority government,” many commentators wrote, “because he can’t win Quebec.”

The demise of this fallacy started to take shape in November 2008, at a time when Harper was still disappointed with the results of the October election, in which Quebec denied him a majority. This was also when McGuinty got the news that the Ontario economy was collapsing, with the manufacturing sector evaporating and the almighty auto industry almost bankrupt.

Provincial Liberals and federal Conservatives were fighting each other — and the federal minister of finance, Jim Flaherty, was accused of undermining Ontario’s economy by encouraging investors to stay away from the province.

But this was a fight mainly between Flaherty and his Ontario counterpart Dwight Duncan; McGuinty and Harper were just treading water at a distance.

A message that Harper, disappointed with Quebec, was ready to open up to Queen’s Park, was delivered to McGuinty on Nov. 7, 2008. The Ontario leader, just back from a trip to China, decided to act on the afternoon of the following Monday, Nov. 10, at the end of a federal-provincial summit in Ottawa. And he did.

After the meeting, when all the premiers were leaving, McGuinty stayed behind and informally approached Harper. He told the Prime Minister that it was time to work together for the sake of Canada and Ontario.

Read more...

Persichilli: Harper and McGuinty called Quebec’s bluff - thestar.com

Judge orders kids to state-run daycare | Canada | News | Toronto Sun

By Kris Sims - From the Toronto Sun

A Quebec judge has ordered a family to send their two youngest children to state-run daycare for "socialization."

Along with raising concerns about speech delays in one of the children who has hearing problems, Judge Nicole Bernier said the kids, aged three and five, need "socialization" outside of the family.

The parents also have two more children, aged seven and nine, who were forced last year to send their once home-schooled kids to public school under a court-order.

The most recent compulsory daycare decision was handed down in March and is now being heard by the Quebec Court of Appeal.

Translated from French, Bernier said of the parents: "They have isolated themselves with their children in a very limited view of what constitutes education of a child, wanting to protect children from the external environment they perceive as bad. They have deprived the children of a proper education."

The parents have not been charged with negligence or abuse.

Their family doctor testified, saying the children were all healthy and well cared-for.

Roy Green: Separatists’ winning conditions recede with Bloc tide | Full Comment | National Post

How about a word for Quebecers who utterly destroyed the party, the man and perhaps the myth.

Sovereigntists scoffed when their former leader Lucien Bouchard declared last year there would be no “yes” vote for Quebec separation from Canada in his lifetime. Bouchard immediately was declared irrelevant by PQ and BQ supporters. 40%+ in Quebec could invariably be counted on to declare for the “Quebec nation”. Reaching that one vote beyond the necessary 50% “le prochain fois” and lowering the Canadian flag for the last time was really merely a matter of proper timing and “winning conditions”.

By Roy Green - from the National Post

On Monday Quebecers endorsed Lucien Bouchard’s viewpoint more than the Jack Layton road map. Certainly the NDP’s socialist approach resonates in a province predisposed to left-leaning philosophy, but Quebecers didn’t need to elect Jack Layton and a slate of caucus members he can’t yet identify without name tags for that. Quebecers had their 20-year champions of “l’affairs Quebecois” — the BQ and its taciturn and seemingly undefeatable boss Gilles Duceppe in place and prepared to return to Ottawa. Read more...

Roy Green: Separatists’ winning conditions recede with Bloc tide | Full Comment | National Post

Jack Layton, On Why Residents of Quebec Are More Important Than Other Canadians.

Believe in democracy as the idea of "one person, one vote", and that this is a sacrosanct part of Canadian government?  Jack Layton doesn't.  Consider this exchange from his interview with the Globe and Mail's editorial board:

Mr. Geiger: We have a couple of questions from readers. I just received a Tweet from Caroline Hayward. She’s asking, Do you support additional seats for Ontario and Western Canada? You favour abolition of the Senate, which is one way in our parliamentary system that regional voices can be aired. If you are going to do that don’t you need to have better representation in the rep by pop chamber, which required reform of the house?

Mr. Layton: Yes we do support more seats for Ontario and Alberta and British Columbia. We also support retaining the current weight of Quebec in the seat calculation and we think it is possible to find our way to both of those objectives.

You mentioned the Senate. Imagine appointing candidates to the Senate, Members of Parliament who were defeated by the people of their region, and then you put them in the Senate. This to me completely undermines any argument that the Senate constitutes regional representation.

I clearly am very unhappy with what is happening with the Senate. The Senate has now become an activist entity. Overruling decisions that have been made by the elected house of commons. Other countries would not tolerate this and yet we somehow find it acceptable.

Mr. Geiger: If you have more seats to western Canada and Ontario, how do you maintain that historic balance with Quebec? They either get proportionally more seats or they don’t. Are you suggesting that all regions get more seats?

Mr. Layton: There would be additional seats allocated in Quebec as well.

Mr. Geiger: Even though it is not justified by population?

Mr. Layton: Well it justified by the historic political weight of Quebec in the federation. There is a solution that can be found here. It’s not an easy thing to do but it is one that we need to work for.

But we absolutely support additional seats for Ontario, Alberta and British Columbia. They are under represented at the moment and that needs to be addressed.

Mr. Stackhouse: And more seats for Quebec?

Mr. Layton: There would be an adjustment vis a vis quebec.

Mr. Geiger: So in other words, they wouldn’t have proportionally more seats.

Mr. Layton: Yes they would. Well, they would have more seats. Significantly more.

Mr. Geiger: But not proportionately more?

Mr. Layton: Well, it would begin to redress the very significant dis-proportionality we see.

In Canada we have a representative democracy, based on the idea that a given number of Canadians are grouped together in ridings to be represented by one Member of Parliament in our government. While the reality has always been that some ridings are more or less populous than the ideal, the objective has always been a basic level of equality.

But as the populations of British Columbia, Alberta and Ontario continue to grow at a much faster rate than those of the other provinces, if seats in the House of Commons aren't redistributed to reflect this, or more added for those three provinces (and to others if similarly necessary) we run the risk of the ideal of "one person, one vote" becoming nothing more than a memory.

This is what Jack Layton has proposed.  He would guarantee Quebec's current percentage of seats in the commons in perpetuity, regardless of it's population relative to other jurisdictions.  So Quebec, which now has 75 seats, or just over 24% of the seats in the Commons, and is over-represented relative to ON, AB, and BC already (ON has 106 seats, AB 28, BC 36 - and based on even distribution, QC would have 68) would be locked in at that percentage.  Even if down the road Quebec's population were to merit only 20% or less of the seats in the House, they would still be guaranteed 24%.

Now, you ask, are there not other provinces much more over-represented than Quebec?  Yes - the only provinces NOT over-represented are, in fact, Ontario, Alberta and British Columbia.  But with an adjustment to the number of seats, this can be dealt with.  No province is guaranteed a fixed percentage of the seats in the House of Commons in perpetuity.  Yet.  Layton, in his quest for votes, is bribing Quebec with the promise of just such a guaranteed percentage.  This means that, as Quebec's share of Canada's population continues to shrink (projected to drop to 21% by 2026, with Ontario rising to 41% from the current 38.5%) the three currently under-represented provinces will see themselves even further discriminated against. As other provinces grow, this could become an issue for them as well.

The roots of the term democracy lay in the Greek demos, meaning people, and kratos, meaning power.  It is understood that the first examples of Athenian democracy were a literal  gathering of all citizens (not including slaves, women, etc - it was not an overly egalitarian society, to say the least).  Today, we realize a gathering of every Canadian of voting age in one place would be difficult, to say the least, and so we have a representative democracy.  This means the country is supposed to be divided into equally populated areas, each of which sends a representative to Ottawa.  While we don't in effect have this now, for a variety of (basically constitutional) reasons, the growth of the nations population, or the ability to add seats to the Commons, means we could see this problem eventually disappear.


But not if Quebec is guaranteed a permanent 24% of all seats in the House of Commons.  If we do, Canadian citizens outside of Quebec will have a new name.  Second class.

* - in particular those in Prince Edward Island (due to a constitutional requirement that no province have fewer MPs than Senators) and the north are underpopulated, while many urban ridings are overpopulated

Jack Layton, on the record - The Globe and Mail

Does NDP pose more of a threat to national unity than the Bloc? - The Globe and Mail

by Adam Radwanski - from the Globe and Mail

The obvious, instinctive reaction is to cheer for Jack Layton – if not nationally, then in the province where he’s most caught fire.

Quebeckers have long parked their votes with the Bloc Québécois – a party that by its nature has no interest in building a better country. Mr. Layton’s NDP, which has seemingly come out of nowhere to lead the Bloc in popular support, offers the prospect of more constructive representation and more thoughtful consideration of Quebec’s role within Canada.

But before getting out the pompoms, Mr. Layton’s message in recent days raises an uncomfortable question: Could the federalist party pose more of a threat to national unity than the sovereigntist one?

To create the “winning conditions” that sovereigntists have long been seeking, and that will be in demand if the Parti Québécois defeats Jean Charest’s Liberals in the next provincial election, requires a strong sense of grievance. The oui side came so close to victory in the 1995 referendum largely because of the perception that Quebec’s interests had been rejected by the rest of Canada, through the defeats of the Meech Lake and Charlottetown accords. But as of now, there’s nothing nearly so galvanizing in play.

For sovereigntists, it’s difficult to change that on their own. The PQ plans to try, with a stridently nationalist agenda aimed at provoking Ottawa. But Bloc MPs can make no serious claim to wanting to make federalism work, so it’s hard for them to help convey and spread a sense of disillusionment. Nor can they easily entice the federal government to launch into constitutional talks, of the sort that have previously ended in heartbreak, because no prime minister would be under any illusion that he or she could make them happy.

History suggests, however, that self-identified federalists are a different story. In the 1980s, Brian Mulroney built a coalition with soft nationalists, then tried to appease them. His reward was a chunk of his caucus breaking off to form the Bloc, a gesture with much more impact than anything the party they formed could do today. Their revolt, along with the frustration of the federalist provincial government of the day, helped set in motion the near-miss in 1995.

Since then, federal governments have stepped more carefully. Jean Chrétien’s Liberals went nowhere near constitutional talks, and took the opposite tack by introducing the Clarity Act. (That they also created all kinds of bad will with the sponsorship program is a different matter.) Paul Martin was more ambiguous – making former Bloc MP Jean Lapierre his Quebec lieutenant, and embracing “asymmetrical federalism” in a way Mr. Chrétien didn’t. But after dabbling with soft nationalism – giving the Québécois a “nation within Canada” designation, and engaging in a flirtation with Mario Dumont’s Action Démocratique du Québec – Stephen Harper has shifted back a little closer to where Mr. Chrétien was.

It remains highly unlikely that Mr. Layton will lead the government after May 2, but seat gains in Quebec and elsewhere could give him a big hand in shaping it. So it bears noting that there are a few shades of Mr. Mulroney’s approach in what he’s doing to win over Quebec.

The NDP has long had a commitment to provincial autonomy for Quebec that seems at odds with its interventionist message in the rest of the country. But Mr. Layton isn’t just promising not to impose federal programs. He backs extending Bill 101, Quebec’s controversial language legislation, into federally regulated workplaces. He is non-committal on the Clarity Act. He doesn’t want to add more seats in the House of Commons for underrepresented provinces such as Ontario and Alberta, without also adding more seats for Quebec so that it remains overrepresented. Read more...

Does NDP pose more of a threat to national unity than the Bloc? - The Globe and Mail

Hébert: Why Gilles Duceppe has overstayed his welcome - thestar.com

By Chantal Hébert - from the Toronto Star

Danny Williams had it. So did Lucien Bouchard. It turns out that Gilles Duceppe did not.  When it comes to their exit from the political scene, few successful leaders have a reliable sense of timing.  Intoxicated by repeated victories, many end up staying past their prime and taking their party an election bridge too far.

On that score, the former premiers of Newfoundland and Labrador and Quebec are notable exceptions. Perhaps because they had more fire in the belly to begin with and little natural inclination to fade gently into the night, Williams and Bouchard had the instinct to bow out before they had exhausted their welcome.

Duceppe, on the other hand, has missed his cue. Over the past four weeks, he has been finding out the hard way that his deal with Quebecers was not open ended after all.  Even leaders who never have to wear the scratch of a single unpopular decision ultimately exhibit corrosion from the passage of time.

For the best part of the last year, the Bloc and its leader have been on a lengthy 20th anniversary celebration. In hindsight, that celebration was ill-advised. Read more...

Hébert: Why Gilles Duceppe has overstayed his welcome - thestar.com