The media’s approach to covering economic data can be confusing. It has been a fascinating thing to watch over the years. The release of provincial budgets over the past week or so is an excellent case in point. New Brunswick announced a $700 million deficit and some fairly limited tax cuts (the corporate tax cut is only $6 million in year one) and the media coverage was overwhelmingly positive. Both the Globe & Mail and the National Post ran op/eds praising New Brunswick and the National Post piece hoped that Alberta and Ontario were watching New Brunswick.
Then Manitoba – a have not province not much larger than New Brunswick with no oil and gas royalties – comes out with a balanced budget and the national media focuses primarily on the tax and fee increases required to reach the balanced budget. No mention of whether Alberta or Ontario should be watching Manitoba. In fact, the Hurculean feat of achieving a balanced budget was hardly mentioned.
Then Ontario comes out with a budget than includes a deficit that is less than half of New Brunswick’s – based on the size of the budget – and McGuinty is roundly criticized for being just another Bob Rae – in fact I saw Rex Murphy last night and he is absolutely livid about this reckless spending. The media did spend a considerable amount of time covering McGuinty’s move to the HST.
I have said on these pages that I don’t have a problem with short term deficits – particularly if the money is going to economic development efforts – so I am not going to backtrack now. I am not criticizing the government for running a deficit. I am expressing confusion as to why a massive deficit is a secondary consideration to a small tax cut.