C.C. and B.C.C. To other interested partys. Letter To the Editor: "The Shame of the Budget Surplus" Some consumers of propaganda who have followed the Federal Budget deficit demon of the 80’s, through the slashing of the transfer payments to the provinces, and the subsequent demolition and cutbacks of our social and education services, will be puzzled to know that the current surplus has little or nothing to do with the sky high interest rates, and all the demolishing, slashing, and cutting of social programs While the demolishing, slashing and cutting were started during the Mulroney Administration, they were continued without abatement (or apology) by the Chretien Administration (He also failed to abolish the GST and the NAFTA) Since the common monetary policy spanned both administrations was the Deputy Minister of Finance, David Dodge, one can only assume that the Finance Ministers of both administrations were willing participants in implementing his policies. Those who are concerned with two tier or privatization of our health system should be alert that the previous Deputy Minister of Finance is now Deputy Minister of Health. As to the current budget surplus that the Finance Minister is at such pains to look good dispersing, accountants will be surprised that the size of the surplus is more of an accounting procedure than good fiscal management. An eminent author, economist and monetary expert, Wm. Khrem, who does not subscribe to the current conventional economic wisdom, has revealed in his monthly economic newsletter "ER" that the size of the surplus can be attributed directly to the introduction of capital budgeting insisted upon by the Auditor General, Denis Desautels. What that means is that what was seen as a massive deficit in the 80’s, prompting the sky high interest rates, slashing and cutting, was a failure to adhere to correct accounting practices. Those same incorrect accounting practices resulted in apparent deficits, the very real high interest rates and the GST that we are still paying, and the disassembly of our uniquely Canadian social safety net. A partial correction of the faulty practices have given us low interest rates and a massive budgetary surplus and a more active economy. The Minister of Finance has asked Canadians what should be the priority in disbursing the surplus. The answer is clear, "Put back into the economy what you have taken out. Restore the provincial transfer payments and either abolish or reduce the still hated GST." The consequence will be the opposite of the hardship imposed on the middle and lower income earners, the unemployed and the unemployable. Those with memory will recall that the implementation of the GST, far from replacing the Manufacturers Sales Tax, in fact resulted in an almost 7% consumer price increase. Otherwise started, an almost 7% reduction in Canadians standard of living. The Manufacturers Sales Tax, which was touted as an inhibitor on exports did not, as the press popularly parroted, apply to exports. Current proposals to reduce the Corporation tax by 5% and abolish the 5% surtax on income is precisely the wrong policy. Ed Goertzen Oshawa, Ont. CA ===================================== ***Anyone who would rather not receive these occasional letters to the editor, to MPP's and MP's, ***PLEASE*** ***simply hit the return key. Ed G. It is seldom that everyone shares the identical interests. =====================================
