Ignatieff flip-flops on tax cuts

[capricorn]

In an interview with Le Devoir, Iggy said he would vote down a budget that contains tax cuts for the middle class.

il rejettera un budget qui contient des baisses d'impôt pour la classe moyenne, comme Stephen Harper et Jim Flaherty l'ont laissé entendre. L'accent devra être mis sur l'aide aux personnes vulnérables et sur la création d'emplois, dit-il.

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«Il y a une division très nette entre ma position là-dessus et celle du gouvernement Harper, lance Michael Ignatieff. M. Harper parle de baisses d'impôt généralisées pour la classe moyenne, alors que je parle de baisses d'impôt ciblées pour les moins fortunés.»

And he thinks this can only be done with a strong central government.

«Le projet essentiel de M. Harper, c'est d'affaiblir le gouvernement fédéral. Je suis contre ça. Pas parce que je veux un Ottawa centralisateur ou entrer dans les compétences des provinces. Mais je crois, en tant que fédéraliste convaincu, qu'il faut un gouvernement fédéral qui protège les plus démunis et qui travaille pour égaliser les chances de chacun. C'est une vision du gouvernement qui est différente de celle de M. Harper. Alors si je vois dans le budget un affaiblissement permanent de la capacité fiscale du gouvernement de créer des conditions d'égalité pour tous, je vais voter contre», dit-il.

---

«J'ai peur que des baisses d'impôt généralisées [...] entraînent un déficit duquel on ne pourrait pas sortir.»

http://www.ledevoir.com/2009/01/15/227507.html

Ignatieff and Harper are clearly at odds on the question of tax cuts for the middle class.

In an interview with the National Post, Mr. Harper said that he believes it is very important that the middle class is part of the stimulus program. "It is very important to help the vulnerable, struggling sectors and help people who are losing their jobs. But you can't sustain economic activity without having stimulus for the middle class as well. That's very important. Since the middle class is paying most of the freight, the middle class has to share in the stimulus program and we will be making sure that is the case," he said.

When asked if this was a commitment to cut income taxes for middle-income Canadians, he said that the government was looking at a range of spending and tax measures. "I'm not committing to you any particular measure, but the principles are clear. We have to help the vulnerable and those affected most severely by the downturn. But you can't do that and leave the middle class to fend for itself. A program like that would not be successful," he said.

This position appears in contrast with that of Mr. Ignatieff, who told a French-language newspaper that he would reject a budget that contained tax cuts for the middle class. The emphasis should be on helping vulnerable Canadians and on job creation, he said.

It appears that Iggy has changed his position from just a week ago.

However, the Liberal leader's view on the issue is not entirely clear since last week he told an audience in Halifax that if he were prime minister he would introduce tax cuts aimed at low income and middle income Canadians.

http://www.nationalpost.com/news/story.html?id=1181605

Either Iggy is reverting to the Liberal strategy of orating from the the left and governing from the right or he has no idea how to situate the Liberals at the centre of the political sphere. By adopting the position of protecting "the vulnerable" and excluding the middle class, it also appears he is making a pitch for votes from traditional NDP voters.

Who are the "vulnerable" in our society? When I think of the term vulnerable, I think of people on welfare, the disabled, low income earners and seniors living on small pensions. Many of these individuals are off the tax roll. Therefore, how can they be part of an economic stimulus? At this time, all I can think of is the construction of more social housing units and, raising welfare and disability payments. True, some low income earners could benefit from a tax cut but would it translate into the purchasing power required to stimulate consumer spending at a level required to rev up the economy?

Well for one thing, Ignatieff has now differentiated himself from Harper on how the middle class fits into an economic stimulus package. That is of course, if Iggy sticks to it and doesn't change his mind, again.

[punked]

Please only Americans want a leader who never reassess the situation. The Flip-Flop term is over used and makes your post while it might be a good one garbage. I have changed my mind many times over my life time does that make it wrong?

[bush_cheney2004]

Please only Americans want a leader who never reassess the situation. The Flip-Flop term is over used and makes your post while it might be a good one garbage. I have changed my mind many times over my life time does that make it wrong?

"Americans" work very hard coining political terms for import and re-use in Canada. We even have blow-up dolls and life-size cardboard figurines for more realistic comparisons between Obama and the domestic stiff of your choice, providing essential definition that would otherwise go wanting.

[punked]

"Americans" work very hard coining political terms for import and re-use in Canada. We even have blow-up dolls and life-size cardboard figurines for more realistic comparisons between Obama and the domestic stiff of your choice, providing essential definition that would otherwise go wanting.

I have heard this do you know how much Slogan's like "Change" and "America First" ship for?

[capricorn]

Please only Americans want a leader who never reassess the situation.

Actually, I had initially titled the thread "Ignatieff shafts the middle class" but I thought it would be too much for your virgin ears.

Strange that he changed his mind on such an important policy issue within one week.

The Flip-Flop term is over used and makes your post while it might be a good one garbage.

Thank you for your editorial advice. I'll disregard it.

I have changed my mind many times over my life time does that make it wrong?

I too have changed my mind at times. Were we vying for the highest office in the country? No. We're nobodies compared to individuals whose decisions affect 31 million Canadians. That's why when they change their minds, we want to know why and whether it is that a trait of theirs.

[punked]

Actually, I had initially titled the thread "Ignatieff shafts the middle class" but I thought it would be too much for your virgin ears.

Strange that he changed his mind on such an important policy issue within one week.

Thank you for your editorial advice. I'll disregard it.

I too have changed my mind at times. Were we vying for the highest office in the country? No. We're nobodies compared to individuals whose decisions affect 31 million Canadians. That's why when they change their minds, we want to know why and whether it is that a trait of theirs.

Poor arguments all around. Does this make Harper a "Flip flopper" over the Federal deficit? See once we start to define terms they apply to all political figures. I agree let's not have flip floppers you vote none of the above next time ok?

[capricorn]

See once we start to define terms they apply to all political figures.

Who's defining terms? You're just hooked on the term flip-flop because you have nothing of substance to add to the thread.

I agree let's not have flip floppers you vote none of the above next time ok?

No, not OK. This is not the place to start ordering adults around. Put your brain in gear or go to bed like a good little punked.

[punked]

Who's defining terms? You're just hooked on the term flip-flop because you have nothing of substance to add to the thread.

No, not OK. This is not the place to start ordering adults around. Put your brain in gear or go to bed like a good little punked.

So you agree Harper is a Flip Flopper? And we can't have Flip Floppers.

[ToadBrother]

Strange that he changed his mind on such an important policy issue within one week.

YOu mean, sort of like how Harper and Flaherty were acting like the economic meltdown would be no problem during the election, and then afterwards, began talking like the Harbingers of Doom.

Politicians flip-flop. They do it all the time. Politicians are hypocrites and liars.

[capricorn]

Politicians flip-flop. They do it all the time. Politicians are hypocrites and liars.

Of course they do I don't dispute that. I am drawing attention to the matter of whether or not tax cuts to the middle class should be part of taxation initiatives in the upcoming budget. The Liberal position is to cut taxes for some to the exclusion of the middle class. The Harper government wants tax cuts for all taxpayers. There have been discussions of the similarities between the two parties and this is a policy where they disagree.

The upcoming Canadian government budget should include tax cuts, but they must be crafted to avoid creating a long-term deficit, Michael Ignatieff, leader of the opposition Liberal Party, said on Thursday.

Both the Liberals and the governing Conservatives say tax cuts will help stimulate Canada's struggling economy, but the Liberals, the biggest opposition party, want them used to protect the country's "least fortunate" and to boost their consumption, Ignatieff said.

http://ca.reuters.com/article/domesticNews...E50F0A020090116

In effect, the Liberals want the middle class to continue paying taxes at today's rates in order to minimize any deficit resulting from federal economic stimulus initiatives. This is wrong. The middle class should also receive a tax cut to bolster its purchasing power in order to increase consumption. In addition, it is unfair to use middle class wage earners to cushion the inevitable deficit.

[KeyStone]

In an interview with Le Devoir, Iggy said he would vote down a budget that contains tax cuts for the middle class.

And he thinks this can only be done with a strong central government.

http://www.ledevoir.com/2009/01/15/227507.html

Ignatieff and Harper are clearly at odds on the question of tax cuts for the middle class.

It appears that Iggy has changed his position from just a week ago.

http://www.nationalpost.com/news/story.html?id=1181605

Either Iggy is reverting to the Liberal strategy of orating from the the left and governing from the right or he has no idea how to situate the Liberals at the centre of the political sphere. By adopting the position of protecting "the vulnerable" and excluding the middle class, it also appears he is making a pitch for votes from traditional NDP voters.

Who are the "vulnerable" in our society? When I think of the term vulnerable, I think of people on welfare, the disabled, low income earners and seniors living on small pensions. Many of these individuals are off the tax roll. Therefore, how can they be part of an economic stimulus? At this time, all I can think of is the construction of more social housing units and, raising welfare and disability payments. True, some low income earners could benefit from a tax cut but would it translate into the purchasing power required to stimulate consumer spending at a level required to rev up the economy?

Well for one thing, Ignatieff has now differentiated himself from Harper on how the middle class fits into an economic stimulus package. That is of course, if Iggy sticks to it and doesn't change his mind, again.

I'm certainly no fan of Ignatieff, and I think he could probably give lessons to John Kerry on flip-flopping.

However, I do agree with him that now is not the time for middle class tax cuts.

1) We are already running a deficit. We had surplus after surplus - and then Harper cut taxes - and now we have a deficit.

Bush cut taxes in the US and what happened - massive tax deficits.

This myth that lowering the tax percentage will somehow cause new business to suddenly appear out of nowhere to replace the lost tax revenue doesn't work. This idea of being competitive for business is good and all - but then the other country lower their tax so they can be lower than us and so on - it's a lose-lose scenario.

2) In this recession, some people will keep their jobs and some people will lose them. When this happens and you have shrinkage - money becomes more valuable on a relative basis - so in essence the working people all have greater purchasing power. It is those that lose their jobs that need the most help at a time like this. Those on welfare etc, are in a better position. But, we need to help those that lose their jobs to find new jobs - rather than increase the money that those lucky enough to keep their jobs receive.

3) Rather than cut taxes and hope that businesses invest it - what if we just invest it ourselves. Let government figure out what needs to be done and do it. Set up crown corporations (non-unionized) to set up an auto-finance business to help the auto manufacturers since the automakers don't know how to do it. Everyone always talks about Ireland being succesful because of lower taxes - but they forget that the government invested massive cash and did central planning to create the Insurance industry that dominates.

4) In terms of business taxes, lowering taxes does not save jobs. Taxes are only paid by companies that are profitable. So, after all the wages are paid, all the execs get their bonuses, all the depreciation, write-offs, deductions etc - then they pay taxes. No one that is supposed to pay taxes is going to go out of business because taxes are too high. To save jobs, you need to eliminate the standard costs of doing business that are paid by all businesses - things like payroll taxes, workers comp premiums, red-tape, licenses etc.

[capricorn]

However, I do agree with him that now is not the time for middle class tax cuts.

Why then are tax cuts for other taxpayers timely? Many economists are saying that tax cuts increase consumption and the economy responds favourably.

We are already running a deficit. We had surplus after surplus - and then Harper cut taxes - and now we have a deficit.

Surplus after surplus only meant we were overtaxed. Had we not been sideswiped by a global economic crisis everyone would be hailing the tax cuts. The problem we have now is a Conservative government that doesn't have the guts to cut spending. Mind you the Liberals would be just a gutless if they were in power. What government wants to alienate potential voters.

[Smallc]

Surplus after surplus only meant we were overtaxed.

So now we must be under taxed. Does that mean you are in favour of raising taxes?

[jdobbin]

Why then are tax cuts for other taxpayers timely? Many economists are saying that tax cuts increase consumption and the economy responds favourably.

Harper may find himself on the wrong side of this issue.

http://www.ctv.ca/servlet/ArticleNews/stor...14?hub=Politics

And twice the number of respondents, or 31 to 17 per cent, said infrastructure spending was a more effective approach than tax cuts.

Spending was more popular than tax cuts among respondents in all regions other than Alberta, while Conservative voters were more likely to view tax cuts as being as effective as spending initiatives.

Surplus after surplus only meant we were overtaxed. Had we not been sideswiped by a global economic crisis everyone would be hailing the tax cuts. The problem we have now is a Conservative government that doesn't have the guts to cut spending. Mind you the Liberals would be just a gutless if they were in power. What government wants to alienate potential voters.

Fighting off a deficit seems very popular with voters. Why alienate them by making a structural one?

[Progressive Tory]

Of course they do I don't dispute that. I am drawing attention to the matter of whether or not tax cuts to the middle class should be part of taxation initiatives in the upcoming budget. The Liberal position is to cut taxes for some to the exclusion of the middle class. The Harper government wants tax cuts for all taxpayers. There have been discussions of the similarities between the two parties and this is a policy where they disagree.

http://ca.reuters.com/article/domesticNews...E50F0A020090116

In effect, the Liberals want the middle class to continue paying taxes at today's rates in order to minimize any deficit resulting from federal economic stimulus initiatives. This is wrong. The middle class should also receive a tax cut to bolster its purchasing power in order to increase consumption. In addition, it is unfair to use middle class wage earners to cushion the inevitable deficit.

Again, people are cherry picking. Ignatieff favours targeted tax cuts since this budget is supposed to be about providing economic stimulus. It can be assumed that the middle class already has some buying power, but by choice are saving their money 'just in case' (I know I am). Saving money is not an economic stimulus.

However, the budget must help to ensure that the working class tax payers, can remain so; and one of the best ways to do this is to make sure the people who need to buy things, are able to buy those things they need.

"Both the Liberals and the governing Conservatives say tax cuts will help stimulate Canada's struggling economy, but the Liberals, the biggest opposition party, want them used to protect the country's "least fortunate" and to boost their consumption, Ignatieff said.

"There is a distinction between the kind of tax cuts that I favor, and the broader tax cuts that (Prime Minister Stephen) Harper and (Finance Minister Jim) Flaherty are talking about," Ignatieff told reporters in Vancouver."

Ignatieff does support tax cuts for the Middle Class when we're back on track. However, this is an 'emergency' budget, and they are not an 'emergency'.

Edited January 16, 2009 by Progressive Tory

[capricorn]

Harper may find himself on the wrong side of this issue.

Maybe Iggy changed his mind on tax cuts for the middle class after he saw the results of the poll you posted.

[capricorn]

Again, people are cherry picking. Ignatieff favours targeted tax cuts since this budget is supposed to be about providing economic stimulus. It can be assumed that the middle class already has some buying power, but by choice are saving their money 'just in case' (I know I am). Saving money is not an economic stimulus.

When asked what he would do during his first 100 days in office if he became prime minister, Ignatieff said "quick tax cuts" will help stimulate the economy.

"Tax cuts targeted at medium- to low-income Canadians will boost their purchasing power," he said. "There's a strong case for tax relief for the more vulnerable."

http://www.cbc.ca/canada/story/2009/01/08/...ff-economy.html

Iggy referred to medium income Canadians. Did he mean middle class? Or is it a case that he hasn't used the right terminology?

Even the media is confused on this one.

[KeyStone]

Why then are tax cuts for other taxpayers timely?

You're right. They're not timely either. We don't really need any tax cuts right now.

Many economists are saying that tax cuts increase consumption and the economy responds favourably.

Many economists say tax cuts are needed, no matter what the situation is.

Surplus after surplus only meant we were overtaxed.

Considering the massive shortcomings in our health care system, infrastructure and social assistance - I think that surplus could have been better spent. Besides which, in better economic times, it never hurts to pay down our national debt.

If we hadn't been sideswiped by a global economic crisis everyone would be hailing the tax cuts.

Well, the US had some pretty massive tax cuts prior to the economic downturn, and it didn't seem to spark their economy (although there was a short spike as they injected billions in spending into their economy) . What it did manage to do was help them to create massive deficits.

The problem we have now is a Conservative government that doesn't have the guts to cut spending.

No. Cutting spending is the worst thing you can do during a recession. During a recession, you want everyone to spend more money to kickstart the economy not spend less. So when Harper talks about 'leading by example', he obviously doesn't know what he is talking about. Fortunately, somebody seems to have talked some sense in to him so he's committed to government spending and big deficits which is exactly what this country needs right now. Unfortunately, it looks as if he won't be spending in the right places.

Mind you the Liberals would be just a gutless if they were in power. What government wants to alienate potential voters.

Increasing government spending is not alienating. Having an NPA is alienating. Making the seal hunt illegal is alienating. Yelling separatists with such anger that spittle flies out of your mouth, is alienating.

[capricorn]

Well, the US had some pretty massive tax cuts prior to the economic downturn, and it didn't seem to spark their economy (although there was a short spike as they injected billions in spending into their economy) . What it did manage to do was help them to create massive deficits.

In that case, will Obama make things worse with his proposed stimulus package?

The package would include tax cuts of $500 to $1,000 for middle-class individuals and couples, and a total of more than $100 billion for businesses, officials said.

http://www.cbc.ca/world/story/2009/01/05/obama-stimulus.html

[KeyStone]

In that case, will Obama make things worse with his proposed stimulus package?

http://www.cbc.ca/world/story/2009/01/05/obama-stimulus.html

I don't think tax cuts are going to do all that much for the economy. For spending to work, it has to be targeted correctly.

Randomly giving it out, in the hope that people will spend it in the right place, is a lot less effective than actually spending it in the right place.

Government needs to take a firmer hand right now and invest/loan to industries that are sorely needed.

Specifically, our finance sector, auto sector and housing sector are all taking hits. We need to spend money here. These three sectors are all critical - especially housing and finance.

Fifty years ago, tax cuts and random money being given to people would have been more effective, because there was more protection and less globalization - therefore the money would have stayed in the economy and bounced around a few times. Now though, a $1000 given out to someone might result in it being spent at Wal-Mart - 30% stays in the economy. 30% goes to China etc and 40% goes to the US.

Ideally, what we need right now are things like the Business Development Bank, programs like that encourage home-buying, a better model for financing such that it is not so interconnected, so that it doesn't all collapse if one of the big ones collapses. But no one wants to do what needs to be done, they just want to shout the popular mantras of tax relief.

[Molly]

NPA?

[Progressive Tory]

http://www.cbc.ca/canada/story/2009/01/08/...ff-economy.html

Iggy referred to medium income Canadians. Did he mean middle class? Or is it a case that he hasn't used the right terminology?

Even the media is confused on this one.

There is a lot of confusion over what is middle class, but one definition is "Middle class persons commonly have a comfortable standard of living, significant economic security, considerable work autonomy and rely on their expertise to sustain themselves.” (Sociologist Dennis Gilbert) That's what I think of when I hear the term; though some have also divided it between upper and lower middle class.

When Mr. Ignatieff speaks of medium class, I believe he's speaking of union workers, teachers, tradesmen, etc.; who make up roughly 1/3 of the adult population. They are the ones more apt to spend, but also the most vulnerable right now. If he had meant 'Middle Class' he would have said medium and upper; not lower and medium. A 2007 U.S. report stated that medium income was between $47,000 and $52, 000 per year.

Edited January 16, 2009 by Progressive Tory

[Alta4ever]

I don't think tax cuts are going to do all that much for the economy. For spending to work, it has to be targeted correctly.

Randomly giving it out, in the hope that people will spend it in the right place, is a lot less effective than actually spending it in the right place.

Government needs to take a firmer hand right now and invest/loan to industries that are sorely needed.

Specifically, our finance sector, auto sector and housing sector are all taking hits. We need to spend money here. These three sectors are all critical - especially housing and finance.

Fifty years ago, tax cuts and random money being given to people would have been more effective, because there was more protection and less globalization - therefore the money would have stayed in the economy and bounced around a few times. Now though, a $1000 given out to someone might result in it being spent at Wal-Mart - 30% stays in the economy. 30% goes to China etc and 40% goes to the US.

Ideally, what we need right now are things like the Business Development Bank, programs like that encourage home-buying, a better model for financing such that it is not so interconnected, so that it doesn't all collapse if one of the big ones collapses. But no one wants to do what needs to be done, they just want to shout the popular mantras of tax relief.

So what I get out of all this crap you spew is that you think that you and government know better then me what I should spend my money on?

I know better then government, you know why the Big three are in so much trouble a failing business model, and more and more people like myself who do and will not support CAW and choose to by Toyota, or Nissan instead of supporting bad corporate decsions by the domestic car companies and the overly power union that is playing a huge role in destorying them. No thanks, I rather see my money go to china Japan or mexico. I want them to go through chapter 11, it will void a lot of over paid union contracts, and get rid of the current management in these companies.

You want to encourage home buying what did that sort of program do to the lending companies in the states? Do you recall the melt down caused by people getting morgages that can't afford them? It just happened in september. Our Banking system is currently ranked best in the world, do what you suggest would put us in the same situation as the US are in now. You sound as idiotic as Barney Frank.

[jdobbin]

Maybe Iggy changed his mind on tax cuts for the middle class after he saw the results of the poll you posted.

He may be hearing some of that out in public meetings as well.

I think a tax cut is not very high up with Canadians. People are much more cautious about the deficit than the government seems to be.

Another poll today kind of confirms what the first poll showed.

http://www.ctv.ca/servlet/ArticleNews/stor...?hub=TopStories

A new poll shows Canadians would much rather see an increase in government spending than a further reduction to the GST in the upcoming federal budget.

The Strategic Counsel, which conducted the poll for CTV News and The Globe and Mail, asked respondents to rate the top three things they'd like to see in the January 27 budget.

"Head and shoulders, above anything else, people want to see infrastructure spending," Peter Donolo, a partner with the Strategic Counsel, told CTV.ca.

My guess is that people don't think a GST cut is going to fix the roads. And fixing infrastructure is what people have been talking about in polls for a while now. $1 billion in infrastructure spending equals 35,000 jobs.

A GST cut = people saving money, people buying things. If people look to save money/pay debt, it is the Paradox of Thrift. In other words, when everyone tries to save money, it makes that situation worse.

I said earlier if you are going to make a tax cut, make it temporary. However, gauging the feeling in the country, I think infrastructure spending is what is expected and what is wanted.

[Moonbox]

A GST cut = people saving money, people buying things. If people look to save money/pay debt, it is the Paradox of Thrift. In other words, when everyone tries to save money, it makes that situation worse.

I said earlier if you are going to make a tax cut, make it temporary. However, gauging the feeling in the country, I think infrastructure spending is what is expected and what is wanted.

The timing of any infrastructure spending is WAY off now. Infrastructure spending needed to start like 6 months ago to have any effect on the recession. By the time contracts bids are accepted and work starts we're already going to be out of the recession. Infrastructure spending takes forever to take effect. I think we need some but $40B of infrastructure spending would be silly. GST cuts are the only thing that are going to encourage spending.

Edited January 16, 2009 by Moonbox