Monday, June 28, 2010

What price for all of Harper's wins?

The fitting split-screen image on Canadians' television screens as Harper delivered his closing remarks at the G20 in Toronto. Fitting because as he was reading off the big summit achievements, the costs were looming large in the background. There's the billion dollar bill we taxpayers will foot for this meeting. And there's the immeasurable damage to civil liberties that we witnessed on the weekend.

For that very steep set of costs, the win that we are supposed to value above all else is...a G20 agreement to targets on deficit reduction. Yes. That is what is supposed to rouse the Canadian soul after this weekend and make us feel ok about the bill and the mayhem. He may have some help, it was reported as a win on the lead of the CTV national news last night, for example. But is this really a win of any substance? The answer is no.

Here's the communique as to what has been agreed to on deficit reductions:
...advanced economies have committed to fiscal plans that will at least halve deficits by 2013 and stabilize or reduce government debt-to-GDP ratios by 2016. Recognizing the circumstances of Japan, we welcome the Japanese government’s fiscal consolidation plan announced recently with their growth strategy. Those with serious fiscal challenges need to accelerate the pace of consolidation. Fiscal consolidation plans will be credible, clearly communicated, differentiated to national circumstances, and focused on measures to foster economic growth.
We recognize that these measures will need to be implemented at the national level and will need to be tailored to individual country circumstances.
Key words there, "differentiated to national circumstances." "Tailored to individual country circumstances." It's a voluntary set of targets:
It is the first time the G-20 has set dates for deficit reduction, but the timetable, which is not binding, will probably not require new policy actions. Most of the governments, including the United States, have already put forward budget proposals in line with the targets.
So there are no requirements for nations to actually do much of anything, and they can essentially follow their own timetable, because that's how the G20 works in any event. Just like we never had to fear a bank tax's imposition in the way we were egged on to fear it by Harper and Flaherty, other nations have no fear of Stephen Harper's deficit targets. Sure, said the nations, we'll sign up to the voluntary declaration, where do we sign, Steve?

We too are apparently already on target to reduce our deficit by half by next year according to the federal budget itself, due to an accounting maneuver. So we're being re-sold something that is written in the spring federal budget as Harper's big win at the G20:
"The deficit is projected to be cut by almost half from $53.8 billion in 2009–10 to $27.6 billion in 2011–12. This significant drop in the deficit for the most part reflects the Government's commitment to make certain that Action Plan stimulus measures expire as scheduled on March 31, 2011."
We've actually gained nothing here, for Canada, except some momentary manufactured political hay on the last day of the G20.

Read through the rest of the communique and you won't see much in the way of achievement. If there's any achievement it can fairly be said to be an agreement to put things off. Banking reform off to the next G20 in Seoul in November. Fighting corruption off to Seoul. Environmental discussions off to the next UN conference in Cancun. And so on.

Pretty thin gruel for the hefty tab, the hit to Canada's image around the world and for Canadians grappling with the aftermath of what played out on our screens all weekend.