Politics: Canada: Equalization payments to fix fiscal imbalance - accrdng to Harper, Klein, McGuinty, & columnst Richard Gwyn
In Canada, ever since Prime Minister Stephen Harper opened his campaign to woo Quebec in the person of its Prime Minister Jean Charest, leader of the provincial Liberal Party there, the Furies have tried to pry open a Pandora's Box. On one front of Harper's strategy, that of acknowledging the cultural-linguistic difference of Quebec's francophone majority from the cultural profiles of the other non-Aboriginal areas, Harper's opening the way for that province to become represented at UNESCO has led to Manitoba demanding to have its own special representative at the World Agricultural Organization (WAO). Equality of the provinces! - where Manitoba wants its cattle and corn to have a voice of ther own!
But now comes the response to the second prong of Harper's Quebec strategy. Fiscal imbalance. That is, how shall the tax revenues received by Ottawa from the have provinces (Alberta and Ontario, presumably) by allocated among the have-nots (all the rest)?
For a year, McGiuinty's Ontario, traditionally the haviest of all, has been pleading poverty with some probable validity, as the former industrial leader among Canadada's provinces has been seeing its manufacturing base dwindle and its emmployment opportunities shrivel. This is especially so ever since terrorism has slowed the traffic on the Golden H+way from southern Ontario down the trade corridor deep into the USA, and the Canadian dollar has strengtthened against the US dollar. Thus, McGuinty has his fiscal imbalance, to be sure. And he wants Ottawa to reconfigure the provinces status, to be sure. Fiscal imbalance! Equalizatian of the provinces!
Gloria Galloway and Karen Howlett, "Provinces won't dictate equalization, Harper says - PM unmoved by Klein's vow to fight plan," Global and Mail (May26,2k6).
Prime Minister Stephen Harper says the national equalization program falls under Ottawa's jurisdiction and none of the provinces can dictate how the money collected from taxpayers gets divvied up among poorer regions.That remark alone will cause the fur to fly as Klein tries to subtract AlbOil from the equation, while McGuinty tries to subtract exactly what?
His comments yesterday were made a day after Alberta Premier Ralph Klein threatened to pull the province out of the program if its vast natural-resources wealth is included in the equalization formula.
"I think we need to be clear. Equalization is not an Alberta program or an Ontario program," Mr. Harper said in response to questions from reporters in Vancouver.
"Equalization is a strictly federal program. And, obviously, while I would like to see a consensus of the provinces on this, I think it is becoming increasingly obvious there won't be one."
The Prime Minister continued:
As a result, he said, the federal government will determine the formula for calculating equalization payments to less-prosperous regions after examining the findings of a number of reports into the matter.That is, he no longer wants Ontario to help the other provinces along to the large extent that obtained in the past, and he may have some justification. But the matter will be resolved, I would think, on a technical level, after determining an honest accounting methodology and adding things up for comparison. At the same time, some provinces are economically stagant and are accustomed to much of their able-bodied workforce embracing a culture of poverty that is expensive for other provinces. - Politicarp
"We know the provinces are very divided on this," Mr. Harper said. But he made it clear that he was not going to be dictated to by Mr. Klein or any other provincial politician.
Mr. Klein vowed this week to fight "tooth and nail" to protect his province's natural-resource wealth, including possibly dropping out of the equalization program. He told reporters Alberta will seek a legal opinion on whether it can pull out of the program.
In Ontario, Premier Dalton McGuinty declined to comment.... But a senior government official said Mr. McGuinty welcomed Mr. Klein's comments because they show that he is not alone in fighting efforts to enrich the equalization program.