Have you ever noticed that some people see what they want to see? Check out Charles Cirtwell’s interview in the TJ today.
Much of what he says I agree with – particularly about New Brunswick not being a basketcase. But he consistently has tried to use the example of New Brunswick to highlight what he thinks is going wrong in Nova Scotia:
When people outside the region ask me what’s going on here, I tell them this: We have an experiment occurring between free-market concepts in New Brunswick and free-spending concepts in Nova Scotia. I think we’re going to see that New Brunswick’s approach is better. New Brunswick’s approach is about doing what governments should be doing, which is creating an environment for business – as opposed to trying to be business.
I don’t think the data backs him up. It is true that New Brunswick has a much lower debt to GDP ratio but if you bring in NB Power’s debt – we are just about the same. In the minds of the bond rating agencies, they factor in NB Power’s debt as public debt and so should we because much of it is stranded and will come out of the taxpayer either directly (through an Ontario style restructuring) or indirectly through rates that are higher than they should be in order to pay down debt that should have been paid down before.
As for the broader, ideological sweep about free-market in NB and free-spending in NS – that’s bogus.
RBC is one of the better organizations for their analysis of government spending. It is hard to do a completely accurate comparison between provinces because certain provinces have more or less crown corps or have other spending mechanisms that don’t compare easily but – as a proxy, RBC’s comparisons are good. In their most recent report, RBC shows that government spending relative to GDP in Nova Scotia has been consistently below New Brunswick. Program expenses per capita are much lower. Program expenses growth since 2001 has been about the same. Click on the link if you don’t believe me, Charles.
From the 2008 Stats Can SEPH data, there were 18,140 people working in provincial and local government administration in Nova Scotia or 4.6% of the total (from SEPH). In New Brunswick there were 15,480 or slightly higher than Nova Scota at 4.9% of the total workforce.
Basically what you have here is Cirtwell approving of the deep tax cuts in New Brunswick and disapproving of Nova Scotia resisting the temptation to cut taxes and then engineering some view of the world that doesn’t correspond with reality.
The guy NB hired that recommended the deep cuts to personal and corporate taxes said that NB would likely have to raise the HST to 15% – exactly what Nova Scotia did and Donald Savoie recommended this as well.
Cirtwell is a very bright guy but he shouldn’t take these kind of liberties with the facts to take a shot at the Nova Scotia NDP government.
New Brunswick is facing some serious challenges – economic, demographic and now fiscal (government) and he isn’t adding much to the dialogue with this ideologically motivated piece.