Unpopular Trudeau will buy electorate’s affections his usual way: a tax cut
by John Ivison
The 2015 reduction in middle class tax rates from 22 per cent to 20.5 per cent cost around $3.5 billion, so it is not a small promise
Bill Morneau was in Port Hope, Ont., this week, telling people the economy is strong and that middle class families are better off, thanks to “the government’s plan to invest in them.”
Many Liberals believe they should be in Kim Jong Un or Saddam Hussein territory by now, winning 100 per cent of the votes.
The finance minister and a good number of his colleagues appear bemused that voters are repaying their largesse with such ingratitude.
How can they be trailing in the polls when unemployment is at a 40-year low, income taxes for the middle class have been cut and children have been lifted out of poverty by the Canada Child Benefit?
Yet, as a large poll for CBC News this week suggested, many Canadians do not recognize their own lives in the rosy statistics tossed at them by the governing party. One third said the cost of living is what worries them most, with 83 per cent saying they are concerned about the growing proportion of their incomes devoted to groceries, electricity or gas.
Inflation has been relatively benign but one explanation for this disconnect has been put forward by economists Herb Emery and Xiaolin Guo at the University of New Brunswick, who looked at how well the official measure of the cost of living — the Consumer Price Index — captures the real cost of price increases experienced by Canadian households. They found that lower income households, families with children, households in rural locations and women have seen the true cost of living increase at rates as high as 10 per cent since 2010, far in excess of the official CPI rate of two per cent.
Andrew Scheer’s Conservatives have done a good job at showing they care about what the leader calls the “cost of living crunch.” He has said he will be the prime minister for people “who just need a break.” There are few clues as to what he means, beyond a repeal of the carbon tax and a pledge to cut the GST from heating bills. Given he has also promised to balance the budget within five years of becoming prime minister, his room for further manoeuvre is limited.
Even the NDP has gotten wise to the affordability concerns, making commitments to introduce universal pharmacare, “head to toe” health care (including eye care and mental health care) and a cap on cellphone bills.
Yet, to this point, we have heard very little from the Liberals when it comes to reducing the cost of everyday living. That will change when the writ is dropped. The Liberals will make the case that they are the solution to a problem created by the laissez-faire Conservatives.
The “hopeful” narrative this time will echo Morneau’s claim that the average family is $2,000 better off, thanks to income tax cuts for the middle earners and the Canada Child Benefit. It will point to the Canada Workers Benefit for low income workers and the increase in the Guaranteed Income Supplement as a social welfare safety net, plus an enhancement of the Canada Pension Plan. Crucially, since much of this is in the rear-view mirror for many voters, there will be new measures for the middle class “and those working hard to join it.”
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