Canadian Politics ...

A few people have mentioned to me that I talk about American politics quite a bit more. Frankly its because there is an election going on down there and essentially its an 11-month election from start to finish. But, here is an entry about our Canadian politics.

The Globe and Mail article, "Ontario set to become 'have-not' province: Flaherty" basically says that Ontario will soon need the support of the rest of Canada. Equalization payments will (eventually - maybe) made to the most populous province. If you think about it, Flaherty is right. With the strong Canadian dollar (against the U.S. Greenback) and the looming recession in the States, its no surprise that Ontario will begin to struggle with its heavy, heavy dependence on manufacturing. This is just yet another volley in the bickering between Ontario and Ottawa. Honestly, I'm siding with Flaherty. Flaherty makes comments earlier that Ontario should cut its corporate taxes. McGuinty complained that there just isn't enough money to do that. Well, that maybe true, but if you CUT taxes, more businesses will come to Ontario and thus you won't lose as much as last year's books would indicate. A little short term pain for long term gain. That's the problem with McGuinty, he seems to be way to short sighted. The thing is that huge deficits became all the rage in the late 90s and early 00s. Then shorted sighted governments passed a law saying deficits should be illegal. This really just handcuffs governments only to look to the very short term. Allowing small (not excessive) deficit spending is a necessity even in the business world.

One of the major sticking points between the federal and Ontario governments, is government assistance for manufacturing companies. Governments have no business in bailing out the manufacturing sector, especially the auto industry (that's an entirely different post). Why should the Federal government bail out (potentially) poorly run businesses? Or companies that are making things people cannot currently afford? The economy will right itself, companies will still manufacture products and there will still be jobs (perhaps not as many, but there will still be jobs). This isn't Ottawa's problem. This isn't a government problem. In times of down turn (which we are rapidly approaching or currently in the midst of), the companies that do survive not only build better products but build them more efficiently. Thus better for international competition. What would people think if oil and gas prices plummeted and the government stepped in and bailed out them out? People would just ask why and say its not justified. They made billions and billions of dollars 'gauching' us already, they don't need it. Its a matter of perspective.