The idea of a imported recession, not of Canada's doing, is the primary way the government can deflect responsibility. Couple the economic origins with the argument of relative fiscal strength, any deficit we incur, much less than other jurisdictions, and it softens the impact of running in the red. We've already heard many government Minister's reference the American deficit, to show things could be much worse. It's a fairly persuasive argument, because economists and pundits will support the notion of relative fiscal health. Canadians see deficits everywhere, the global reality more cause than our government's actions, we're still relatively well off.
The other theme, potentially problematic for the Liberals, the Conservatives can argue that we too support a massive stimulus, which makes a large deficit inevitable. How can you blame the government, when your own party supports a massive injection into the economy? You argued for a stimulus, now you blame us for a deficit, which your policies demanded? That domestic fact, in concert with all other countries providing stimulus, allows the government to argue deficits are just the reality of the situation, not a reflection of competence or management.
It is imperative, that the Liberals argue forcefully, from all quarters, repeated ad nauseum, until it's imprinted in our brains, the following:
Next week (Prime Minister) Stephen Harper presents his financial budget after a decade of Liberal surpluses," he said. "Where are we? We are facing a deficit of $40 billion and this deficit is squarely Mr. Harper's responsibility. He spent us down to the red line in the good times and so we face the hard times as citizens of this great country with the cupboard bare."
This government spent wildly, in the lead up to this recession, further eroding our fiscal room. This government embarked on a series of tax cuts, universally rejected from the same economic people that are now supposed driving the budget thought process. This government abandoned the contingency fund, which was put in place for exactly these sort of extraordinary circumstances. This government claimed to have prepared us for the coming economic storm, and yet they rendered the government impotent, destroying any fiscal room to act, without plunging us into deficit. YOUR children are on the hook for the Conservatives fiscal mismanagement, and structural deficits have returned.
Whatever the size of the deficit, the Liberals need to argue that it didn't necessarily have to be this way. It is true, that we do need to go into deficit, during this economic downturn, but the SIZE is entirely a function of Conservative blunders. If the government moves on more tax cuts for the middle class, the Liberals have a counter- we simply can't afford it, given the way the government squandered our fiscal health. The "cupboard bare", that is the legacy and we will all pay a dear price in the future, for that reckless management.
There will be an epic battle of "frames" in the coming weeks and months. It is beyond crucial that the "wear it" narrative takes hold, otherwise, in many respects, this government receives a pass for their past actions. This tug of war is the first real test for the new era Liberal Party, can it be heard against the sharp messaging campaign of the government? The words of our leader today suggests we understand the importance...