A week and a half ago I looked a T-D bank report called Market Based Solutions to Protect the Economy. In today's Financial Post Terence Corcoran has a read through it, and comes away very unimpressed.

The report concludes that a carbon tax (or Pigovian Tax, if you prefer) is the best way to reduce carbon emissions, and Corcoran disagrees. Corcoran in fact, makes a somewhat convincing , and surprising, argument that regulation is the way to go, citing success in reducing sulphur emissions as his proof.

I myself, have become less and less convinced that using the tax system is the way to go, last weeks Toronto hydro rate increases being a classic example what's wrong with using the tax system. As customers have reduced, Hydro's profits have decreased, thus they increase rates. The next step is to ask yourself, why should I conserve? The same effect would almost certainly occur if the tax system is used to decrease emissions: as soon as tax revenues decrease due to conservation efforts, the tax rate would go up to make up shortfalls. At that point, the effort to lower emissions stops, as people efforts are not being rewarded (same basic problem occurs with Dalton McGuinty's Smart Meter program - once everybody is doing their dishes in the middle of the night demand will increase at that time, causing the rate to increase in the middle of the night).

While it is odd reading a free marketeer like Corcoran calling for regulation, it is a worthwhile discussion to have. And he's right, regulation can promote change without price shocks, and the price shock if government decided to tax the CO2 out of us would be substantial.

During my budget analysis, At Home in Hespeler contributer Ron disagreed with me that it was a bad budget, suggesting it was as good as we could get under the circumstances. Little did Ron know that in the ensuing debate, I had some big guns to point at him.

Gerry Nicholls, the vice president of the National Citizens Coalition and one of the top five political minds in the country, wrote a piece that today appears in the Sun chain and that, basically, slaps down our own Ron on his budget analysis.

Here's Ron:

They did what they had to do to make certain people happy.
I don't beleive that they have suddenly abandoned their fiscal roots.
Hang in there until the majority happens. Those roots will start to surface again...

And here's Gerry Nicholls from today's article:

Still, some conservatives are defending the budget arguing it’s just smart politics.

By moving to the left on these fiscal issues, goes their reasoning, the Tories will win a majority government, freeing them to unleash a true conservative agenda.

The problem with this argument is twofold.

First, Conservatives win elections when they put themselves forward as an alternative to big spending Liberals; they lose elections when they try and out-Liberal the Liberals.

Secondly, even if the Conservatives do win a majority government in the next election they will have done so as big spenders.

That means they won’t have a mandate to implement a cost-cutting, state-reducing program.

In other words, the Tory budget is bad for taxpayers, it’s bad for our economy and it’s ultimately bad for the Conservative Party.

It seems Flaherty has forgotten the words of former U.S. President Ronald Reagan who said, “The problem is not that people are taxed too little, the problem is that government spends too much.”

Sounds like Gerry Nicholls is talking to Ron. And yes, that's presumptuous of me, but it would be more presumptuous if Gerry hadn't answered Ron directly in the comments to my post:

Gerry Nicholls said...

Here's the problem:Once a government starts spending like this; it's a hard habit to break.

So there Ron!

In some fairness to Ron, the post stopped dead with his last question, which I didn't answer not because I was befuddled, or waiting for Gerry Nicholls to answer for me, but because I spent the last bunch of days upgrading my computer (hard drive, RAM, Windows Vista), and have not had time to answer. So I will answer here, instead.

The question:

Lets go back to my original question - Do you think the Cons could win a majority?
I don't think so and I believe this budget was meant to buy time and votes.
Does Gerry believe that Stephen Harper has abandoned his fiscal beliefs? Were we all so blind as to what he stood for?
Could this be the real "hidden agenda"??
I don't think he has played his hand. This has got to be a bluff.

Two points Ron, if the Cons can't win a majority, then they haven't done a good enough job. It is the responsibility of a party to explain why their ideas are good, not the electorates responsibility to just "get it." I have heard no teaching coming from the Conservatives. Just the sound of money flying out the door.

Second, if they did get a majority based upon this budget, then became tax cutters doesn't that show they had a hidden agenda. If, as you put it, "this has got to be a bluff," then the real hand is hidden.

So no, I don't think they have a majority, but they didn't need $200M spending to maintain government. Look, the Bloc is not going to go back to the same supporters who just ran and financed a Provincial election for the PQ, and say lets do it again. Harper has at least a year leeway, what's the hurry? If he gave tax cuts, then waited a year for the benefits to hit the economy, he may be able to win an honest majority. A conservative majority.

And as Gerry Nicholls, I think accurately, points out in todays Sun, "...Conservatives win elections when they put themselves forward as an alternative to big spending Liberals; they lose elections when they try and out-Liberal the Liberals."

The proof (of da proof, which is da good proof) is in the dog food:

An Ottawa woman is recovering after eating dog food and then becoming violently ill, in a case possibly related to the rat-poison-laced pet food that has killed 14 dogs and cats and sickened dozens more across North America.

Elaine Larabie said yesterday she ate some dog food last week in an effort to convince her terrier, Missy, to do the same.

Soon afterward, both Larabie and Missy found themselves in the hospital - Larabie at an after-hours emergency room, and Missy at Ottawa's Alta Vista Animal Hospital.

Wonder who spent less time waiting for medical attention, and who got the better treatment?

Climbing Out Of The Dark

Hunter is a female Edmontonian who has found the silver lining in this weeks Conservative budget:

So, this budget is priceless for no other reason than the Conservatives, with straight faces I might add, did away with the tax haven used by exPM Martin, you know, the one he would not close, for unknown reasons. So, exPM Martin and his company now finally will get to pay taxes here in Canada.

All the Fluffy news about the worlds biggest nuts.

Bobby Brown is pitching a new reality TV series "Dating Bobby Brown":

Bobby believes the best way to win a man’s heart is through his stomach, so he’s planning to have the women cook for him while they parade around in thong bikinis.

Classy guy. But, besides being the clown who ruined Whitney Huston's career, who is he?

Carol Burnett is suing the maker's of the TV show The Family Guy over an episode that spoofs her old Variety show. I never watch the Family Guy, but I'm going to have to dig that episode up: if it's good enough to get sued over, then it's good enough to watch. Thanks for the tip Ms. Burnett.


Ms. Burnett is not the only celebrity from my childhood feeling litigious this week. The Bay City Rollers are suing Arista Records over, what they claim, is millions of dollars in unpaid royalties over the past 25 years. If it's true that "Arista's claim over the last 25 years that it does not know who to pay" they should have no further worries: pay the guys on the other side of the courtroom.

You could see this one coming from a mile away. One of these guys (Derek Longmuir I think) has been working as a dentist the past 20 years. Good luck to the lads, if their statement is true then they deserve the money.

We need to add a new term to the popular culture lexicon:, "Indy Girl." Like the Bond Girls, they are the female lead to play opposite Harrison Ford's character in the Indiana Jones movies. Previous Indy Girls would be Karen Allen, Kate Capshaw, and Alison Doody. In the case of the upcoming look for Cate Blanchett. While this report says she's rumoured, IMDB seems to have her confirmed.

Since we are comparing Indiana Jones and Bond, after this movie is it possible to replace Harrison Ford as Indiana Jones and continue the franchise?


Naomi Campbell has begun community service, cleaning at a NYC Department of Sanitation garage, for throwing her cellphone at a maid.

There, let that be a lesson to you.


It appears that Iron Lady Margaret Thatcher is about to become a movie:

London-based producer and distributor Pathe Productions said Tuesday it had commissioned a film about former Prime Minister Margaret Thatcher, set during the 1982 Falkland Islands war with Argentina.

What's the bets that, regardless of how good, the actress who plays Thatcher is not even nominated for an Oscar?


Vanessa Williams has received a star on the Hollywood Walk of Fame. You have to wonder When Dom Ameche or Marlon Brando or Bogie got their star in the walk, did they really believe they would be keeping such illustrious company as Vanessa Williams?

Deeply saddened to hear to hear of the death of Calvert DeForest, the actor behind Larry 'Bud' Melman from the Letterman show for years. One of the most memorable bit actors pop culture has ever produced.

Melamn/DeForest was 85, and passed after a long, unidentified illness.

Below is a clip of Larry 'Bud' Melman handing out towels at the NYC Bus Station:

Well, I've had my first bike ride of 2007, the sun on my face, the wind through my helmet-less hair my muscles used hard and put away wet, and I had some thoughts while I was out there:

*Nice Budget, Mr. Flaherty
*Sponsorship Program? good idea Mr. Harper
*Nice Dog, Mr. Dion
*Nice Hair Britney
*Nice House Mr. Gore
*Hey, Rock and Roll Hall of Fame: Grandmaster Flash - nice
*Mr. Chomsky - "Hegemony is the root of all evil." Feel free to use that as a gift from me.


I'm feelin' nice, it must be...


SPRING!

Now if you'll excuse me, I have to go to my wonderful job because I love my company and my union.

Yesterdays Financial Post had two great articles worth reading. The first, by Peter Foster, documents how far into environmentalism we are being taken:

Travel once broadened the mind. Now it is claimed to threaten the planet. Climate change moralists, anti-global localists, and the enviro-left more generally, all want to keep us at home. The sole exception to this new dogma are the thousands upon thousands of policy wonks and NGO reps who seem constantly to be criss-crossing the skies to attend meetings in exotic locations to promote the new feudalism.

If it is wrong for people to travel, it is even more pernicious that agricultural products should go on long journeys. Kiwi is now the forbidden fruit, since it comes from a remote part of the globe to markets in Europe and North America. Thus is a small green delicacy linked to allegedly "robbing our children's future." In reality, such restrictions amount to an attempt to rob our children's present. The perspective, experiences and even diets of our progeny must be narrowed for the sake of indeterminate threats to our great-grandchildren, about whom we -- the fecklessly short-sighted -- are declared not to care sufficiently. So government -- guided by eco-fascists --must do it for us.

Well, screw that nonsense.

Well screw that nonsense indeed! But he's right, if the environmental lobby had it's way, we would all return to Victorian Times (he calls it a new Dark Age)and take the Barouche to work - unless you are an environmentalist. Then there's that conference in Dubai that can't be missed.

The second article, Lower. Taxes. Soon. Please. discusses how this weeks Conservative budget
represents a failure of conservatives to show the benefit of lower taxation:

Actually, informed speculation suggests that, given their poll numbers in Quebec, the Conservatives like their chances in an early federal election. If so, they probably designed the budget to be election-proof. And if that's true, the Conservative brains trust clearly believes targeted tax-and-spend policies -- or tax-expenditure and spend policies -- are what Canadians want.

Mr. Harper is a cagey political strategist. He's hard to second-guess on what Canadians want. If it's not what small-c conservatives want, then the fault is ours. We haven't persuaded people our policies are what the country needs. The solution is not for Mr. Harper to get a majority under false pretences and then revert to his true Reform/National Citizens Coalition self. Short of war breaking out, Canadian voters will never give him a blank cheque. No, the solution is to sell ordinary Canadians on the policies the country really needs.

He`s right, too. As conservatives we aren`t getting the message across that tax cuts help everyone. Canadian conservatives need to do a better job if we want to see real conservatism in this country.

Ten days ago it was being reported that CAW employees at Brampton's DaimlerChrysler assembly plant voted to accept mid-contract concessions in order to save jobs at the plant. The reason cited by the for needing the concessions was a need to keep costs down so the cars built at the plant could remain competitive.

Yesterday browsing the post (sorry I can`t find a link - try page A6 of the National Post for Wed. Mar 21st) and side bar titled Good Cars vs. Bad Cars. As I suspected on Tuesday night, two of the Brampton built vehicles are slated for tax increases under the new rules.

Both the Dodge Magnum and the Chrysler 300C will have a $2,000 tax added on to them. What does that do to the sales of the vehicles? And at a cost of how many jobs?

John Williamson of the Canadian Taxpayers Federation has done a fair bit of complaining in the past six months about Stephen Harper and Jim Flaherty's spending habits. I must confess, I kind of cringed when he did, thought to myself careful what you say John, it could be much worse.

I was wrong, it couldn't be any worse. Harper and Flaherty have pulled themselves out of the conservative movement, spending at a level than can only be called scandalously profligate. Meanwhile tax relief is just enough to appear to be keeping their promises, actual and implied. Canadian conservatism has been dealt a severe blow with this budget; ask yourself this. If Flaherty and Harper don't understand that a surplus is excess taxation, and should be treated with the respect that is due pother peoples money, who in this country will?

Where to start? How about day care. After fighting an election on the simple premise that parents know best, the Conservatives (note the capital C) have decided to give a whack of daycare money to Daddy Dalton and the other Pater Premiers to build public daycare spaces.

Tax break for fuel efficient vehicles? At least we can be thankful it's not a carbon tax, which seems to be the only policy that separates the Conservatives from everybody else anymore (but give it a year). But isn't a subsidy for efficient cars just a reverse carbon tax. And how many people will enter the car buying market now that the low end cars are $2,000 cheaper. Harper's an economist, he gets this idea, if you give people money to buy something, people who otherwise would not have bought will enter the market. How do we know this isn't adding to the total carbon emissions it was meant to reduce? In fact, it probably will.

Then there's the tax on larger vehicles. While not purely a carbon tax, the next worse thing. Question: who gets to decide which vehicle qualifies for this tax? Last week employees at Chrysler's Brampton plant decided to take a minor pay cut to save their jobs: what does this measure do to those jobs? Will the Charger and 300C be included under this tax?

$2000 dollars/child tax credit. Nice, I used this years tax refund to buy the kids new bikes, it's like they are paying me back. I would rather they never took the money in the first place though. Stop with the targeted tax cuts, and just cut our damn taxes. Is it so hard?

That's just the tip of the iceberg, but I'm not laughing all the way to the election this morning. In fact I'm left wondering: who the hell is a fiscal conservative supposed to vote for now?