Another Friday, another instance of Canadian Finance Minister Jim Flaherty running up to the first podium he finds to pretend he's a doctor desperately and single-handedly trying to cure the ailing global economy's woes.
He said Europe is in a dire situation and needs to take urgent action. What a surprise! How original - only the deep intellect of a bay street lawyer could have produced that statement. Actually, meaningless and par for the course. Conservative minister talking points are always based on soundbites they think people want to hear. Never mind reality or worse, unpleasant truths. Let's pretend we're the stern moral compass of a lazy, disorganized, bureaucratized European continent and people will eat it up. Forget that Canada is hardly in a position to talk or that there is nothing to be done at this point - indignation makes the minister look like he's working really hard, or something. Well, Jim, don't apply for that stress leave just yet because I'm going to make your job, this international fake superhero of finance part of it anyway, easier for you. Bailout or no bailout, the whole European continent is on the fast track to DEE-FAULT, and you would think a guy who takes himself for a serious economist would talk to more real serious economists, who are by now all pretty much in agreement on that.
A little more complicated is the domestic front. Jim said when lecturing Europe: "individual households don't live like this." He must not have been referring to Canada.
Jim, meet Gail. Gail, meet Jim.
Gail Vaz-Oxlade is the host of tvs popular "Till Debt Do us Part", where she educates hopelessly indebted households on the ways to get out of the stupendous financial holes the Canadian financial system is only too happy to aid and abet their falling into. Pay down debt, cut expenses, make tough decisions, start saving. She has plenty of content to draw from week in and week out because this is a huge problem in Canada. All the smug idiots in the Conservative cabinet who love bragging about the "stability" and "strength" of Canada's economy continue to ignore the record household debt, record debt to asset ratios, and record bubble real estate prices in Canada, all of which have passed 2006 pre-bubble U.S. levels. Maybe if Jim sat down with Gail more often instead of the CEOs of the financial institutions fuelling this debt maelstrom, he would think twice before making the illusory common sense proclamation that "households don't live like this."
I don't want to use Ms. Vaz-Oxlade as a prop in my column. I greatly respect the work she's done over the years, especially publishing The Canadian Woman's Guide To Divorce in the early 1990s, a time when our society had considerably less resources for divorced women and considerably more patriarchal baggage than it does today. I mention her work because it is comprehensive. Staying financially healthy might seem simple when you consider it just a matter of not letting more funds go out than you take in, but as any student of economics will tell you, there is much more to it than that. Trade-offs must be made and priorities must be set because, as the golden rule of economics states, there is no such thing as a free lunch. There used to be financial barriers to entry around BMWs and home theatres. There still are, but our society of late has evolved from the free lunch doctrine to one resembling "You can have everything you want at the all you can eat buffet and more at Prime minus a quarter". Enter the market for a show like Till Debt Do Us Part.
Which is why I implore Jim to quit his weekly media bellyache over Europe and maybe do his job and focus on his own government's finances instead. He is presiding over the same financial wreckage at a nation-state level as one of these basket case couples on the show does at the household level. Not only are there not plans to cut Ottawa's current fiscal deficit, the minister is likely unaware and certainly uninterested in the infrastructure defecit, which is that Canada's infrastructure needs something like $80 billion in upgrades in the next five years just to stay functioning as is, plus $150 billion in upgrades to properly service the futurepopulation. There's a great interactive map on the CBC about this here. Under this government we will watch this crumble and do nothing, because as Jim Flaherty's stated in the past, "Ottawa is not in the business of fixing potholes." Even though Ottawa collects the majority of our taxes, and every province and city is broke.
About those provinces and cities, their debt plus the Federal government debt puts us, the Canadian nation, at a higher level of indebtedness than these countries, like Italy, Greece and America, that Jim takes it upon himself to lecture.
The advantage of having Gail for finance minister over Jim is she does two things he won't do - she looks at all money coming in and going out and she makes people plan for the future. With the revelation that this government is indebted like all the others and the minister saying himself in his speech that this is no time for "risky" and "dangerous" new spending, why is the government spending $33 billion on warships, $35 billion on fighter jets, $2-5 billion to start on new prisons and mandatory minimum sentencing, plus tens of millions on new MPs, and who knows what else on various private-sector subsidizing boondoggles and endless "Economic Action Plan" pork-barrel scams (Read of the week - Andrew Coyne's hilarious column on innovation and "grantrepreneurs"). The finance Minister doesn't mention these things, because as usual he is more interested in being a financial maven poser than talking about his own government's record, a government that is hell-bent on driving this country to financial ruin and ignoring any facts or reality that get in its way. Individuals have Gail Vaz-Oxlade and thousands of not-famous people like her to pull their heads from the sand - but who will perform this task for our delusional minister?