Scott Radley: Billion-dollar campaign promises are great until we actually have to pay for them
As we head toward Election Monday and leaders of all the parties continue to throw around promises that would cost us billions of dollars, a question pops to mind.
How different would the campaign - and our politics - be if the federal and provincial governments had to handle their finances like municipal governments do?
By law, cities cannot run operating deficits. They can go into debt to pay for infrastructure projects and the like but can't borrow to pay salaries and fund other ongoing program costs. So each time councils want to add a program that will cost more money they have to find that cash somewhere, either by growing the tax base, by finding savings, or by raising taxes.
There's no buying your vote with some future generation's money. Which means rather than promising everything to everyone, councils have to make some difficult decisions about how to control costs in order to keep taxes from ballooning. They must pick their priorities.
If they decide to go wild with the credit card anyway, their constituents feel it right away. The residents can then decide if all the spending is an acceptable cost to make things better or they can take action at the polls next time to get rid of the misguided spenders.
It makes sense.
If you go out for dinner at a restaurant, you probably wouldn't expect the people who sit at the table after you to pay your bill. We'd probably all agree on that. But that's exactly what we're doing in provincial and federal politics. This election campaign - and pretty much every other one in recent decades - has provided an ongoing series of promises with the popular suggestion that someone else will pick up the tab. The rich. Wealthy businesses. Anyone but us.
A recent national poll found that 82 per cent of Canadians are concerned their income taxes are going to go up because of increased government spending. Which suggests we like the idea of getting stuff, we're just less-enthused about paying for it.
It's an interesting conundrum considering the money has to come from somewhere. And considering many have serious doubts that we'll be able to squeeze those yacht-owners and big banks for anywhere close to the amounts needed to cover all these new plans. Or that the economy will expand enough to produce a big enough tax windfall to account for everything.
So there's the other option. The opposite of the municipal model. Just add it to the debt. Trouble is, dumping more onto the national credit card seems a little risky these days.
The federal government is already spending more than $20 billion a year simply to cover the interest on our massive debt. That's money that could be used to do all kinds of good things but is being flushed down the toilet every 12 months.
If the debt increases further, the amounts needed to service what we owe would likely grow. And heaven help us if interest rates start to rise. But that's for someone else to worry about down the road, right?
To be sure, this pandemic has shown us that there will be moments when we have to spend more than we have. Things like CERB were necessary to get us through a generational emergency. Trying to handle this without taking on debt would've been hopeless.
But not every program being pitched these days is COVID-related. Many aren't. Yet as each promise adds a few more billion here or there, it's impossible not to worry about what kind of mess we're making and what kind of financial burden our kids will someday be facing. And their kids. And theirs after that.
And if some version of the municipal rules might not be helpful here.
Scott Radley is a Hamilton-based columnist at The Spectator. Reach him via email: sradley@thespec.com