The Budget That Missed

Yesterday’s “something-for-everyone” budget can be described in a single word: underwhelming. Yes, the headline numbers ($85B in additional debt over five years, $20B in tax cuts . . .) were huge, but this budget lacked a key ingredient: vision. Look at the spending priorities: tax cuts, infrastructure, home renovation, job retraining, culture – can you look at that list and tell me what the Canada of the future – our Canada – will look like? No. What we have are funds being thrown to the wind with no common goal in mind. This is more than a recipe for waste – it is a disappointing expression of our collective will.

What Stephen Harper had was the chance to articulate a vision for Canada. The time is right for this: Obama’s call for change is still fresh; the global financial climate has shaken us out of our complacency; and we’re willing to take bold, even expensive measures to address our deepening problems. He could have used the budget to press for a greener, more energy-efficient and productive Canada. He could have incentivized environmentally-friendly technologies, retrofits and transportation. He could have led us to a future in which Canadian companies are leaders in sustainable resource utilization, renewable-based technologies, and advanced R & D. Instead, what we get is a generic infrastructure fund – most of which is earmarked for repairs to existing roads and highways, tax breaks that do nothing to make Canadians less profligate, and a home renovation credit that doesn’t encourage energy efficiency (let’s call it what it is: a giveaway to the construction industry and home-improvement retailers). This is laissez-faire thinking in action: don’t have the government pick a direction – let the market choose its way. Talk about a wasted opportunity. If we are going to spend like loons and drive up the debt, we may as well change our society for the better while we’re at it.

I would have liked to see a budget focused on:

1. Improving transportation efficiency
2. Increasing the energy efficiency of Canadian businesses, institutions and families

Any dollar that our businesses, our institutions, that we ourselves, don’t spend on energy is a dollar that can be put to more productive use. This focus could be achieved through a number of measures. For example, the infrastructure fund could preferentially target mass-transit projects by accelerating approvals and kicking in 50% of the capital (as opposed to 33%). Or, we could institute home-renovation tax credits targeting only efficiency-improving retrofits. We could have the social-housing fund pay out only to projects built to LEED standards. Businesses could be given multi-year tax credits for substantially improving their energy efficiency. You can imagine any number of proposals – a whole list of ideas along these lines.

Truth is, Harper and Flaherty can’t deliver a vision. After all, their ideology stresses minimal government intervention in evolving an economy. And so what we have is this: a budget designed to stave off political defeat through public largesse, but one that lacks a guiding principle. This is a shame. Canada is much better off than many other countries; we have the room to experiment, to take a chance at developing new directions for our economy and our workforce. We can afford this – to dream big, to throw our hat into the ring, and yes, maybe fail. At least in doing so we’ll have staked out a direction for ourselves, not simply floundering everywhere all at once and doing nothing well at all. But this budget has us doing the same old. We’re not taking a chance. And we’ll all be worse off because of it.