by Graham Lane
Published in the Winnipeg Sun, January 12, 2018
Looking forward to a better future is a human trait. Companies, groups and governments do it. Think tanks do it too.
Last summer Winnipeg’s venerable Frontier Centre for Public Policy republished an old commentary that envisioned a future Manitoba where the population had exploded to 3 million. That prediction is radical by the plodding standards of our province’s present political classes.
The model contrasts starkly to the Pallister government’s present course, where budgets reach balance in 7 years, based on tax and utility increases and teensy tweaks to barnacled, low-performing, NDP government models. It has Manitoba embracing a smaller, less-costly, and higher performing public sector, bringing significantly lower taxes in an economy now predominantly driven by private enterprise.
Pro-active changes reduce government ownership of the economy, boosting private investment bringing about a lift in incomes sufficient to bring an end to Manitoba’s chronic dependency on federal equalization grants. It’s a major transformation – shrinking government (provincial and municipal) bureaucracy, focusing governments’ attention on core tasks with public sector efficiencies invested in dramatic tax cuts encouraging private sector investments, job creation and further in migration.
Personal provincial income tax rates would fall by half, payroll taxes would end, and the PST would be reduced and harmonized with the GST (simplifying administration and boosting private investment). As is routine best practice around the world, government would regulate, not own, MPI, WCB, MLL and Hydro. Public sector staffing would be benchmarked to national averages, with the current monopolies in the education and healthcare sectors removed to boost productivity.
Gone would be policies that now artificially limit housing availability and boost prices by restricting building lot supply. Agriculture would expand rapidly with the inevitable end of supply management, allowing the egg, poultry and dairy industries to expand and create thousands of new jobs. Such a massive transformation, fueled by vision and real political leadership, would bring about a new ‘have’ province.
Such a make-over would be challenging, no doubt. Unfortunately, the Pallister government neither has the policy capacity nor leadership to take this logical but opposite path towards the realization of a future prosperous “have” province. Tweaking broken stagnation models is futile, as are meager clumsy cuts and fake austerity which, just might, annoy enough voters to return the “have not” province oriented NDP in the 2020 election: an event that would end all hope for a grand transformation.
With Pallister’s go slowly not bravely approach, time and real opportunities are disappearing.
Instead of transforming public services and cutting taxes, we are getting a politically lethal carbon dioxide tax, massive electricity rate hikes, and another political play-toy crown – the rather Orwellian named Efficiency Manitoba. This, just as we enter into a fragile economic period: increasing interest rates; a potential end to NAFTA; Trump’s tax cuts and energy dominance policies; and, more deficits and credit downgrades.
The Province is not well-served by Pallister’s tinkering, which would end up making the situation worse.
If Pallister doesn’t start making significant transformational changes soon, our economy risks further stagnation, an end to the immigration boom, and more of our young and professionals leaving.
Which vision will win out? Will we have a growth or stagnation model? Pallister’s time to choose is soon up.
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