The threat of the theoretical

Shadow-box, verb
1 to fight an imaginary enemy by hitting the air with your hands
2 to pretend to argue about or deal with a problem, often to avoid dealing with the most important problem

I haven’t been around a long time (38 years if you must know) but it seems to me that these days, the threat of the theoretical is the biggest bogey-man in the room when it comes to any substantitive change in society.

Take health care. Theoretically, if you inject private money into the public system, that might result in ‘Two Tier’ health care which, theoretically, might end up with poorer folks waiting longer in line than rich folks which, theoretically, might lead to worse health outcomes and social inequity in society. Never mind that only Canada, North Korea and Cuba in the world have a ‘closed’ system of public health care (according to a recent European study). Never mind that the countries with the most succesful health care systems in Europe allow private provision of health care services along side the public system. The threat of the theoretical.

Any even slight consideration of changing the Employment Insurance system so that 100,000 New Brunswick’s wouldn’t be so dependent on government welfare is met with that bad guy, Mr. Theoretical. Mr. T suggests that any changes would lead to social upheaval and massive poverty. Mr. T suggests we add more money, hold our breath and put as many auto manufacturing plants in Ontario as we can to pay for the EI bums in Atlantic Canada. Maybe, just maybe, there is a better way but we won’t touch it. The threat of the theoretical (or in the case of Doug Young, the stark reality – but I digress).

Then there is the ever present threat of ‘deficits’. Last week former Bank of Montreal Chief Economist Tim O’Neill suggested that the federal government should considering relaxing its ‘no deficit policy’ in favour of the general approach of prudent fiscal management over time. Macleans reporter, Steve Maich, along with almost every commentator, expressed his horror at this in the latest edition of that magazine. If you took, O’Neill’s approach, governments might, theoretically, descend into massive deficits and bankrupt the country. The possibility that a government could actually manage itself in a fiscally prudent way without a ‘no deficit rule’ would be unthinkable. The threat of the theoretical.

This last one grinds my gears more than most. We bind ourselves to a strict no-deficit rule and that in some cases impedes a government’s ability to make any substantitive and necessary changes. Take New Brunswick. We also are prostrate before the idol of zero deficits. Every year we hear with loud backslapping how the government has once again balanced the budget and is continuing to be fiscally prudent. In fact, it brags about cutting spending in vital areas to pay for this zero deficit policy.

If one wanted to make the point, New Brunswick runs a massive deficit every year in the form of Equalization. We need hundreds of millions of dollars from Ontario and Alberta taxpayers to pay for our basic government services, so in that sense, we run massive deficits and then rely on our increasingly cranky cousins to pay the tab.

But that’s the subject of another day. For today, my point is this. We need some bold thinking in New Brunswick. How about building a four lane highway from Moncton to Miramichi to the Acadian Penisula and over to Edmundston? How about running up the debt to do so? Or how about setting up a $500 million trust fund to attract major corporations to the province (just like Quebec and Ontario have done with great success)? Even if we have to run up a temporary deficit?

What good is a zero deficit policy when as a consequence we make almost no investments where it matters to fix our economic problems?

NB circa 2005:
-Population decline since late 1990s.
-150,000 people on Employment Insurance and Welfare in 2003 (on an Employment base of 350,000 people.
-Third lowest economic standard of living in North America.
-A rural exodus threatening the very way of life in rural New Brunswick.
-Balanced budgets.

Sort of loses a little steam in that context, doesn’t it. I hope the next time Jeannot Volpé is bragging about the fiscal prudence of the government, he sets it in the same context as I just did. I suspect that then Joe and Jane Q. Public, like me, would start to lose our enthusiasm for ‘balanced budgets’.

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