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Gallant government will have to show backbone to realize deficit reduction target

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The government of Brian Gallant will have to muster up more backbone than it has shown so far, if it is to realize the 500-600 million dollars it needs to bring us back from the financial cliff.

The reaction to what it is calling its options list – a list of trial balloons it unleashed Friday in the form of a variety of cuts and revenue generation measures, has been as expected.

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The trucking industry won the race to be first to come out in criticism. In their case it was to say the government should not impose highway tolls. Right after that the Fredericton Chamber of Commerce weighed in to say the government shouldn’t raise corporate taxes. The Canadian Taxpayers Federation says the government shouldn’t increase the HST. CUPE says the government shouldn’t eliminate any public sector jobs. The New Brunswick Business Council though, suggests that would be fine.

And that is the pattern. All of these groups and others, every one of them, agrees we have a serious financial situation here, and they all want the government to address it – but apparently only with measures that affect other people.  

And therein lies the challenge.

Taken in isolation, in each case of an organization telling the government to back off, a solid argument can be made.

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Increasing corporate taxes may indeed stifle economic growth. Highway tolls probably would increase the costs of anything that is transported by trucks. Increasing the HST will hurt the business community and especially poor people. Increasing class sizes may be detrimental to the efforts to get math and literacy scores up. Reducing the number of visitor information centres may hurt tourism.  And on and on.

So what to do. Back off on all those suggestions? Then we’re back to the status quo, and that is a recipe for financial disaster.

The official opposition condemned pretty much all of these suggested measures, and while it doesn’t seem to have much of substance to add, it as well knows the deficit has to be tamed. It will be interesting to see whether the Tories will just continue to simply criticize or come up with its own ideas. After all, when they were government they were into restraint too, and would have accomplished more on that front had then Finance Minister Blaine Higgs not run into so much opposition from within his own cabinet. But so far as the official opposition, the only fix they seem to ever mention is shale gas development.

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The more relevant opposition is actually coming from David Coon and Dominic Cardy, both of whom note that the government which said everything is on the table, failed to include in its suggestions ending corporate handouts or increasing natural resources royalties. Good points both, and the Liberal government should be pushed to explain why.

The way it is shaping up, the government will have to be a lot tougher than it has been to date to get this done. These are tough decisions and the government needs to be able to communicate that they are the right and necessary ones, and that they are fair. With the nursing homes fiasco, the government sent the signal that if the opposition is persistent, the government will back down. That, I expect, will give critics encouragement not to let up.

Cue the fireworks. 

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