Friday, October 10, 2008

But, but, but...not a bailout, must repeat, not a bailout...too politically damaging

"‘This is not a bailout:' Harper." Oh no, it's just a redefined linguistic concoction of epic contortions to convince voters that there's nothing to see here. Steve's been blissfully insistent that all is well. That myth came to a screeching halt today:
Ottawa's $25-billion backstop for Canadian banks drew fire from the NDP and Liberals shortly after it was announced Friday morning, with Conservative Leader Stephen Harper maintaining the plan is not an American-style rescue of financial institutions and will ultimately cost taxpayers nothing.

“This is not a bailout of banks. This is a market transaction that will cost the government nothing,” he told reporters.

“We are not going in and buying bad assets. What we're doing is simply exchanging assets that we already hold the insurance on and the reason we're doing this is to get out in front. The issue here is not protecting the banks,” Mr. Harper said.

“The issue here is ensuring there will be credit from those banks to the wider borrowing public.”

The federal government announced Friday morning it will use taxpayers money to buy $25-billion in insured mortgages from banks to free up space on bank balance sheets so they can lend more money to Canadians. It's an effort to ease the supply of cash and reduce borrowing costs across Canada during a credit crunch, Tory Finance Minister Jim Flaherty said. (emphasis added)
Oh, it's just a piddling $25 billion market transaction. Is that what the kids are calling it these days? Gobbledy, gobbledy squawk! Look away Canadian voters! Canada is much different from other nations!

Well, let's recall Steve from eons ago, say a few weeks back when he was opining on the Canadian banks. Harper, on September 19th:
Harper said Friday the Canadian financial system is very strong and the balance sheets of the banks and insurance companies are solid enough that they don't need any financial aid.

"We don't anticipate any crisis in the Canadian financial system," Harper said while campaigning in Quebec for the Oct. 14 federal election. "I think there is some evidence that credit has been tightening in Canada over the past year, but that said, I certainly would not urge consumers to panic."
Harper quoted by CBC, September 19th:
"All our information would indicate obviously while certain banks have had some significant writedowns, that overall, the balance sheets of the Canadian financial sector remains very healthy," Harper told reporters after announcing a Conservative proposal to provide $85 million in tax breaks for families caring for disabled children or relatives.

"The best information I have, and I do continue to get briefed on these matters, is that the troubles in the financial sector of the United States should not spill over into Canada," Harper said.
And Harper has the chutzpah to say things like this today:
“It shows we act in advance to deal with issues. WE do not wait for the point at which we are in crisis.”
He just kills me with this stuff...

So, $45 billion injected in the last week or so by the Bank of Canada and now the federal government. $12 billion surplus left by the Liberals gone. GST cut panned by economists deprives the federal government of $60 billion over the next 5 years. Massive spending by PM since June in bid to get re-elected, to the tune of $19 billion.

And he's the prudent fiscal manager? Canadians need to wake up, fast.