April 27, 2004
By Kevin Little

I've been a columnist for a variety of publications since 1997. In almost every piece I write I plead for attention to be directed toward the poor, the physically and mentally challenged, those who are routinely marginalized by our society like gays and lesbians. Given this emphasis I am almost always pegged as an NDP supporter. And for many years I was, particularly when I lived in Saskatchewan and Manitoba. And for a time I was involved with the NDP in Nova Scotia, even voted for them on a few occasions.

But I am a strange political animal. As much as I consider poverty a matter of profound importance, I give almost equal attention and passion to the crushing reality of our national debt and the deficit financing that has so often plagued our provinces and federal government.

For reasons I cannot ever fathom conservatives seem very focused on debt but not poverty, and the left serious about helping the poor, but indifferent to the concerns around large deficits. Oh sure conservatives pay lip service to poverty, some even call themselves "compassionate conservatives" but the proof is in the pudding. When choices are made it is programs that benefit the poor that are the first to be cut. Similarly most on the left will say they too are concerned about debt, but their words never have the same passion as their statements about poverty. Further the left fought tooth and nail against very effort by Paul Martin to reduce our debt and now conveniently suggest that this battle is won. Jack Layton's response to the last federal budget was clear, the debt is no longer a concern, spending should begin, now.

Even some conservatives seem less than focused on the debt. South of the border President George W. Bush was sworn into office with a massive surplus only to submit a budget with the largest deficit in US history. If the deficit was solely based on an economy in recession, or 09/11 security costs or the war on terror, then we might understand this temporary setback. But Bush's tax cuts are the primary reason for the large deficits. Likewise here in Canada, it is not clear whether Mr. Harper is more interested in paying down our national debt or giving the wealthy additional tax breaks.

Why is the debt such an important issue? We could start with the immorality of one generation expecting a succeeding one to pay for its bills. Again if it were to pay for a just war, a national program to fight homelessness or medicare, we might understand. But the national debt as we know it began to grow when our nation was becoming richer, in the 1970's. You know a nation has problems with its fiscal discipline when it cannot pay its bills in boom times. Between the early 70's and the middle 90's Canada had many boom years, but little would be spent to pay down its debts.

Another reason why the debt is so important has to do with financial markets. Many of the analysts who've examined the wealth generated during President Bill Clinton's time in office give the credit to his first budget, which increased taxes on the very wealthy, kept spending down, and for the first time in a generation, passed balanced budgets. The markets respond very well to fiscal security, that bills will be paid and that therefore investment is safe and sound. This creates jobs, jobs for the wealthy, but also jobs for the middle-class and the poor. Under President Bill Clinton's balanced budgets more poor African-Americans rose from poverty to the middle-class than ever before.

But the connection between the national debt and the plight of the poor is not confined to the markets and their confidence in the economy. There is also the IMF and the lending institutions who manage our debts. In 1994 Janice MacKinnon, an NDP Finance Minister, documents in her book "Minding the Public Purse" that lending institutions were so alarmed with the debt of Saskatchewan there was a real possibility that it would have to declare bankruptcy. And she says, if Saskatchewan had gone into fiscal meltdown, the feeding frenzy that is the globally connected world, would almost certainly have put Canada in a hole so deep it may not have been able to climb out.

This is not an hysterical account by a C.D. Howe or Fraser Institute researcher or from the National Citizen's Coalition, this is documented, in painstaking detail, by an NDP Finance Minister. MacKinnon's agenda was not to use debt reduction as a smoke screen to gut social programs or introduce private health care, but rather because she knew that if the IMF or other lending institutions got involved the expensive programs we use in Canada to assist the poor would be the first to be cut. And the political process, by which our politicians decide what to fund and what to cut, would have been brushed aside by accountants without any regard for the soul of our nation.

I don't blame the left for being frustrated by the issue of the debt. It is hard to produce imaginative programs that help the poor when you have to divert so much capital to the debt. And because the first messenger in Canada to spread this doom and gloom gospel was Preston Manning we were suspicious. Never mind that Tommy Douglas had always produced balanced budgets in lean times and declared that debt only benefited banks, the left had gone through a long period where one's commitment to the poor could only be measured by the expense of one's proposed national program. It was a steep learning curve.

I know. In 1997, I was so angry that the Liberals (whom I had voted for in 1993) had walked away from the Red Book and were behaving like Reformers that I penned a nasty denunciation of the party. But eventually I came to see the need to do exactly what Paul Martin did. Not so the leaders of the left. Bob White, as documented in MacKinnon's book and Bob Rae's "From Protest to Power", advised the NDP governments in BC, Saskatchewan and Ontario to declare bankruptcy. The left just never figured out what the large debt we carried, and carry, does to our financial well-being. MacKinnon asks rhetorically if White and other union leaders would offer up their pensions invested in safe government bonds on which White was now proposing the governments default.

I admire provincial governments like Manitoba and Saskatchewan and a party platform like the Nova Scotia Liberals, that some programs that benefit the middle-class may have to be cut, that no tax cuts can yet be afforded, that the money the government collects should be focused on programs that have a measurable impact on citizens in need. An example would be the federal Liberal government's National Child Benefit in the late 90's. It provided a direct benefit to low-income Canadians regardless of whether they worked or not. I find this kind of program far more fiscally responsible and socially fair than something like the NDP's long standing call for a national child care program.

An election will soon be called. My hope is that one of the party's platforms will focus on the twin themes of reducing both national poverty and debt. They need not be viewed as contradictory. In fact I think that without reducing debt we may never have the financial flexibility to do what we must to help the poor. And if you are still skeptical, ask the citizens of Argentina what they think.