Though I am a big supporter of the Graham government, it is far from perfect. It has gone back on some promises, such as to not appoint a political person as NB rep to Ottawa, the HST rebate, etc. It has implemented some bad policy such as Business New Brunswick cuts and a major hike to the small business tax. However, overall, it has done a very good job in my view.
I have criticized the Tory opposition a few times before because rather than go after the government on these substantive issues, they have led their attacks on fronts where there is no substantive problem but a possible hook for sensationalism.
Today they've got an good issue. They always say that people vote based on pocketbook issues, and what pocketbook issue could be closer to the hearts and mouths of New Brunswickers?
Today, opposition leader Jeannot Volpé led question period off by grilling Finance Minister Victor Boudreau on the possible increases in the cost for beer.
Friday, March 30, 2007
Tuesday, March 27, 2007
Credit Union details come to light
Folks, you aren't going to believe it! The Lord Tories "implemented" a policy that was illthoughtout and not properly budgeted in order to win votes.
No, I'm not talking about the shadow toll fiasco that continues to cost NB taxpayers hundreds of thousands of dollars per month to pay for out of province drivers to use our best roads.
No, I'm not talking about the deathbed conversion by the Tories in 2003 to fixing the insurance problem that they failed to fix and saw New Brunswickers hosed by insurance companies for three more years.
No, I'm not talking about having an agreement-in-principle for Orimulsion but a failure to sign that deal and then going ahead with retrofitting a powerplant anyway and then finding out the other party is no longer willing to sign the deal.
No, I'm not talking about dramatically increasing adminstrative costs at NB Power to enable its priviatation and then backing down when that option is unpopular.
No, I'm not talking about allowing a city to negotiate a deal with a third party that the province will have to pay for and then, without participating in the process, ratifying the deal after the fact by pushing legislation through the legislature.
No, I'm not talking about undertaking unsustainable tax cuts and making up for the lost revenue through the back door by increasing gas tax by 50% and doubling of user fees.
No, I am not talking about 3 out of 7 budgets being called, essentially, lies by the Auditor General because they claim surpluses where deficitis exist.
No, I'm not talking about the HST rebate that was supposed to cost $45 million + adminstration that was budgeted for with $13 million and had no administrative plan.
I'm talking about another fiasco. It has been revealed that the reason for the for the $60 million payout to save the Shippigan credit union is because of Tory legislation that put the province on the hook for any failures in these organizations.
Worse, the Tories left the position of Superintendant of Credit Unions vacant for over three years which is what allowed this problem to come into place and then, because it was popular, and probably saved them a lot of their Francophone seats which they were expected to loose, they came up with the bizarre policy of protecting all assets to be lost by a credit union as opposed to the national standard for banks and province-by-province for credit unions which is up to $100,000.
Spinks says this should be some kind of a loan. But that obviously doesn't make sense. Thanks the the legislation passed by the Tories, there Credit Union has two options: 1) take the money the government is offering or 2) fold, have the government reimburse everyone who losses money and then open a new credit union. There is no option here but to stabalize the credit union. Moreover, it has been revealed in the legislature today that some of this money may be paid back, however the comptroller has said that it would be inproper to account for it as anything but an expense as there is no guarantee it will be paid back until such time as the credit union returns to profitability.
Spinks also says there should be an investigation of fraud, etc, well, because we thankfully have filled the long standing vacancy in the office of the Superintendant of Credit Unions it will be.
Also, I think it is dispicable that the Tories are alleging that this is a "sweetheart deal" being undertaken because former Liberal premier Camille Thériault is the president of the Credit Union Federation.
No, I'm not talking about the shadow toll fiasco that continues to cost NB taxpayers hundreds of thousands of dollars per month to pay for out of province drivers to use our best roads.
No, I'm not talking about the deathbed conversion by the Tories in 2003 to fixing the insurance problem that they failed to fix and saw New Brunswickers hosed by insurance companies for three more years.
No, I'm not talking about having an agreement-in-principle for Orimulsion but a failure to sign that deal and then going ahead with retrofitting a powerplant anyway and then finding out the other party is no longer willing to sign the deal.
No, I'm not talking about dramatically increasing adminstrative costs at NB Power to enable its priviatation and then backing down when that option is unpopular.
No, I'm not talking about allowing a city to negotiate a deal with a third party that the province will have to pay for and then, without participating in the process, ratifying the deal after the fact by pushing legislation through the legislature.
No, I'm not talking about undertaking unsustainable tax cuts and making up for the lost revenue through the back door by increasing gas tax by 50% and doubling of user fees.
No, I am not talking about 3 out of 7 budgets being called, essentially, lies by the Auditor General because they claim surpluses where deficitis exist.
No, I'm not talking about the HST rebate that was supposed to cost $45 million + adminstration that was budgeted for with $13 million and had no administrative plan.
I'm talking about another fiasco. It has been revealed that the reason for the for the $60 million payout to save the Shippigan credit union is because of Tory legislation that put the province on the hook for any failures in these organizations.
Worse, the Tories left the position of Superintendant of Credit Unions vacant for over three years which is what allowed this problem to come into place and then, because it was popular, and probably saved them a lot of their Francophone seats which they were expected to loose, they came up with the bizarre policy of protecting all assets to be lost by a credit union as opposed to the national standard for banks and province-by-province for credit unions which is up to $100,000.
Spinks says this should be some kind of a loan. But that obviously doesn't make sense. Thanks the the legislation passed by the Tories, there Credit Union has two options: 1) take the money the government is offering or 2) fold, have the government reimburse everyone who losses money and then open a new credit union. There is no option here but to stabalize the credit union. Moreover, it has been revealed in the legislature today that some of this money may be paid back, however the comptroller has said that it would be inproper to account for it as anything but an expense as there is no guarantee it will be paid back until such time as the credit union returns to profitability.
Spinks also says there should be an investigation of fraud, etc, well, because we thankfully have filled the long standing vacancy in the office of the Superintendant of Credit Unions it will be.
Also, I think it is dispicable that the Tories are alleging that this is a "sweetheart deal" being undertaken because former Liberal premier Camille Thériault is the president of the Credit Union Federation.
Monday, March 26, 2007
Is it 1976 all over again?
As I watch the results of the Quebec election roll in, it appears as though not only my predictions but those of pretty much every person that made them are dead wrong.
I can't help but think of the 1976 Quebec election. For those of you not as nerdy as I, I will explain the background on that.
It was at that election, when the PQ made a surprise majority win, that the most memorable moment in Quebec or even Canadian politics occured in my mind. A PQ organizer came to the microphone and explaimed, weeping, "Radio-Canada a projeté un gouvernment péquist MAJORITAIRE!" She was overwhlemed by emotion as was the room, the supporters hugged and cried. I have never seen people so visibly moved by the result of an election.
Fast forward 30 years and a few months to the 2007 election. The ADQ supporters aren't crying - yet - but they are certainly shocked and overwhelmed with joy.
The result: a one-man party, led by a former Liberal, with ideas completely opposed to the mainstream of Quebec politics surging from nowhere, surprising all of the pundits, to form a government. Oh whoops, I'm still talking about 1976. That's right, in those days the PQ had 6 seats and was led by Réné Levesque, a former Liberal cabinet minister who was the only thing that gave the party any credibility. They went from 6 seats to 71 and majority government.
As it stands now, it looks like the Liberals and ADQ will fight for first in the mid-high 40s while the PQ is stuck in third in the mid 30s. But what about the long-term ramifications? A party winning 30% of the vote and 35-ish seats probably shouldn't be having its obituary written, but lets look back to 1976.
In those days we had a centrist federalist party called the Liberals and a rightist automist party called Union Nationale. In the distance was a separatist party, the Parti Québécois. When the PQ surged into government the Union Nationale, which had won office only 10 years before, promptly disappeared from the political map despite having been the dominant force in Quebec politics for 40 years.
This time we have a centrist federalist party called the Liberals and a a separatist party called the Parti Québécois. In the distance is a rightist automist party called Action Démocratique. Could history repeat itself in reverse? Could the ADQ replace the PQ, which formed government only 9 years before and like the UN before it dominated politics for the better part of 40 years before its disappearence? Is the PQ over and is Quebec returning to its pre-1973 right vs. left alignment?
I can't help but think of the 1976 Quebec election. For those of you not as nerdy as I, I will explain the background on that.
It was at that election, when the PQ made a surprise majority win, that the most memorable moment in Quebec or even Canadian politics occured in my mind. A PQ organizer came to the microphone and explaimed, weeping, "Radio-Canada a projeté un gouvernment péquist MAJORITAIRE!" She was overwhlemed by emotion as was the room, the supporters hugged and cried. I have never seen people so visibly moved by the result of an election.
Fast forward 30 years and a few months to the 2007 election. The ADQ supporters aren't crying - yet - but they are certainly shocked and overwhelmed with joy.
The result: a one-man party, led by a former Liberal, with ideas completely opposed to the mainstream of Quebec politics surging from nowhere, surprising all of the pundits, to form a government. Oh whoops, I'm still talking about 1976. That's right, in those days the PQ had 6 seats and was led by Réné Levesque, a former Liberal cabinet minister who was the only thing that gave the party any credibility. They went from 6 seats to 71 and majority government.
As it stands now, it looks like the Liberals and ADQ will fight for first in the mid-high 40s while the PQ is stuck in third in the mid 30s. But what about the long-term ramifications? A party winning 30% of the vote and 35-ish seats probably shouldn't be having its obituary written, but lets look back to 1976.
In those days we had a centrist federalist party called the Liberals and a rightist automist party called Union Nationale. In the distance was a separatist party, the Parti Québécois. When the PQ surged into government the Union Nationale, which had won office only 10 years before, promptly disappeared from the political map despite having been the dominant force in Quebec politics for 40 years.
This time we have a centrist federalist party called the Liberals and a a separatist party called the Parti Québécois. In the distance is a rightist automist party called Action Démocratique. Could history repeat itself in reverse? Could the ADQ replace the PQ, which formed government only 9 years before and like the UN before it dominated politics for the better part of 40 years before its disappearence? Is the PQ over and is Quebec returning to its pre-1973 right vs. left alignment?
Sunday, March 25, 2007
Quebec prediction
This is just for fun, I am totally guessing with these numbers and running on my gut without any analysis whatsoever.
Parti québécois 57
Parti libéral du Québec 51
Action démocratique du Québec 17
However, Charest will continue as premier in exchange for implementing some policies of the ADQ similar to the arrangement between the Liberals and NDP in Ontario from 1985-1987 when the standings were PC 52, Lib 48, NDP 25.
Parti québécois 57
Parti libéral du Québec 51
Action démocratique du Québec 17
However, Charest will continue as premier in exchange for implementing some policies of the ADQ similar to the arrangement between the Liberals and NDP in Ontario from 1985-1987 when the standings were PC 52, Lib 48, NDP 25.
Friday, March 23, 2007
Budget retrospective IV and concluding remarks
In this last response, I will cover the points "did the Liberals *really* budget for all of their promises and what was the Grant Thornton report talking about when it said there would be a $300 million shortfall." Following that, I will have some brief comments on the premier's speech in closing the budget debate and my overall thoughts on the budget as a whole considering all of the previous analysis.
Part Four
As I mentioned in a post some months ago, the Liberal promises were priced at $200 million for year one, including some one-time big ticket items like Saint John Harbour, the Marysville Bypass, Task Forces on self-sufficiency, the non-profit sector and post-secondary education, capital construction of a number of new projects, etc.
The $200 million gets spread out over two fiscal years, one presumes, because the government took office half way through the fiscal year.
As I mentioned in the earlier post, based on fiscal transfer figures revised by Ottawa after the 2006 budget, New Brunswick should have been heading for a $320 million surplus in 2006-07 if the books had been properly done. Therefore, even if the Liberals delivered on their full $200 million, there should have been lots of fiscal flexibility left over.
Some things, however, like the HST rebate, were not properly budgeted for by the Tories when they presented their last budget in March 2006. The Liberals mistake was not promising too much, but instead believing in the financial statements made public by the Tories which proved to be flase.
The Grant Thorton report showed that there were major financial challenges however, including the $500+ million final payment for the TransCanada from Woodstock to Grand Falls which the Tories had failed to budget for.
The result - the Liberals could have gone a wholesale promise breaking spree, ran a deficit, raised taxes through the roof, cut programs to death, or some combination of these.
I think they made the best choice of these options, in general, by abandoning and modifying some promises, raising taxes - by-and-large - moderately, and undertaking some program cuts.
Shawn Graham said something that really resonnated with me in his budget speech today:
Part Four
As I mentioned in a post some months ago, the Liberal promises were priced at $200 million for year one, including some one-time big ticket items like Saint John Harbour, the Marysville Bypass, Task Forces on self-sufficiency, the non-profit sector and post-secondary education, capital construction of a number of new projects, etc.
The $200 million gets spread out over two fiscal years, one presumes, because the government took office half way through the fiscal year.
As I mentioned in the earlier post, based on fiscal transfer figures revised by Ottawa after the 2006 budget, New Brunswick should have been heading for a $320 million surplus in 2006-07 if the books had been properly done. Therefore, even if the Liberals delivered on their full $200 million, there should have been lots of fiscal flexibility left over.
Some things, however, like the HST rebate, were not properly budgeted for by the Tories when they presented their last budget in March 2006. The Liberals mistake was not promising too much, but instead believing in the financial statements made public by the Tories which proved to be flase.
The Grant Thorton report showed that there were major financial challenges however, including the $500+ million final payment for the TransCanada from Woodstock to Grand Falls which the Tories had failed to budget for.
The result - the Liberals could have gone a wholesale promise breaking spree, ran a deficit, raised taxes through the roof, cut programs to death, or some combination of these.
I think they made the best choice of these options, in general, by abandoning and modifying some promises, raising taxes - by-and-large - moderately, and undertaking some program cuts.
Shawn Graham said something that really resonnated with me in his budget speech today:
I am not prepared to hit the pause button on our province's progress while we wait for someone else to determine our fate. So we have to look at what changes we can make here in New Brunswick.I remain very upset by the Small Business tax hikes and I think that other taxes or program cuts should have been found instead, however, I would vote for the motion that passed today which reads "that this House approves, in general, the budgetary policy of the government" (emphasis added) and I certainly prefer balancing the budget in this fashion to the doubling of fees that happened twice under the Tory government without debate or public or legislative input.
Rather than hiding the challenges, our government is being open and transparent with New Brunswick residents. We are being open about the challenges and we are being open about how we are going to address them.
We have been upfront about the 5 factors that contributed to addressing the fiscal challenge: eliminating the HST rebate on home energy fuel costs, implimenting new revenue measures, directing departments to acheive program administration reductions, constraining overall government spending growth and revenue improvements since the release of the Grant Thorton report this past December.
Choosing these measures was difficult but necessary and I have to say that no government looks forward to raising taxes. But if our province is committed to standing on its own two feet, we must be able to pay for the services that we provide as a province. The tax reductions that had been made previously were not sustainable.
We cannot have amongst the lowest tax base and the lowest tax rates in the country and at the same time expect to provide our citizens with quality public services that are comparable to elsewhere in the country.
It is important to point out that even with the modest increases, New Brunswick still has the lowest personal income tax burden in Atlantic Canada, the small business corporate income tax rate remains the third lowest in Canada and our income threshold matches all other provinces except Alberta and the general corporate income tax today is the fourth lowest. Our government is committed to being competitive and we will remain competitve but most importantly we will become self-sufficient.
That's why we're being upfront with these tax increases and that has not always been the case with previous governments. Governments who raised revenues by not indexing tax thresholds, or through fee increases that went through cabinet behind closed doors. We are not interested in taxation by stealth, we are bringing these changes here to the floor of the legislature for debate. It doesn't get more transparent than that.
Thursday, March 22, 2007
I am so sick of Margaret-Ann Blaney and other news...
Spinks has a post up about the most recent shenanigans of Margaret-Ann Blaney and an unfortunate comment by Roly MacIntyre that has allowed her to get out of the controversy over her flawed remarks.
MacIntyre called Blaney "Barbie" during Question Period yesterday which sounds quite vile, but deserves some context. Elizabeth Weir was the one who started calling her Barbie and use to call her it almost everyday and it is now a common nickname for her around the legislature and when Elizabeth used to say it on the record it was never considered sexist. Moreover, Blaney never protested when it was used informally and infact, I believe, referred to herself as such on a few occassions.
This isn't the first time she has taken something completely out of context, feigned being the victim, and tried to make political hay of it.
In 2000, when she was Transportation Minister, there was a big scandal because her riding association sent out a letter saying that if construction companies didn't donate, they wouldn't get road contracts. It was a huge bru-ha-ha and everyone expected she would resign but the Times & Transcript had an editorial cartoon of two construction workers, one with a bulge in his pants, and the caption was "Is that Margaret-Ann Blaney in your pocket or are you happy to see me?" She threw a big spell, cried on the floor of the legislature, and the story became about the cartoon and not her unethical campaign contribution solicitations.
In 2005 when she was Minister of Training & Employment Development, she appointed a bunch of Tory partisans with no qualifications to the Human Rights Commission and I think the Workplace Safety Commission. Mike Murphy went on a lengthy rant about it and listed off a bunch of occupations that would be suitable backgrounds for the appointment and said something along the lines of "we don't need dog catchers, garbage men and weather girls deciding on workplace accidents and discrimination cases". She, a former weather news broadcaster, claimed Murphy was making a personal and sexist attack by criticising the qualifications of female weather broadcasters. The story about the bad appointments went away and "weathergirl" became the story.
Just now, she was taking heat for making a ridiculous accusation that the Minister responsible for the Status of Women was incompetent and should resign because she was allowing the Liberals to bring in policies that would give cash only to full time university students, arguing that it is discriminatory against single mothers who can only go to school part time. So she has seized on the Barbie comment despite the fact that it is widely used as a name for her around the legislature by men and women alike of all parties and by herself.
Enough is enough. She has the distinction of being one of two ministers ever dropped from a Bernard Lord cabinet over the course of more than 7 years. I think you can imagine why.
Still working on finishing up my lengthy ramblings on the New Brunswick budget and will hopefully finish them today as the premier will be wrapping up the budget debate tomorrow. For my thoughts on the federal budget, please see Calgary Grit as we seem to be on the same page.
MacIntyre called Blaney "Barbie" during Question Period yesterday which sounds quite vile, but deserves some context. Elizabeth Weir was the one who started calling her Barbie and use to call her it almost everyday and it is now a common nickname for her around the legislature and when Elizabeth used to say it on the record it was never considered sexist. Moreover, Blaney never protested when it was used informally and infact, I believe, referred to herself as such on a few occassions.
This isn't the first time she has taken something completely out of context, feigned being the victim, and tried to make political hay of it.
In 2000, when she was Transportation Minister, there was a big scandal because her riding association sent out a letter saying that if construction companies didn't donate, they wouldn't get road contracts. It was a huge bru-ha-ha and everyone expected she would resign but the Times & Transcript had an editorial cartoon of two construction workers, one with a bulge in his pants, and the caption was "Is that Margaret-Ann Blaney in your pocket or are you happy to see me?" She threw a big spell, cried on the floor of the legislature, and the story became about the cartoon and not her unethical campaign contribution solicitations.
In 2005 when she was Minister of Training & Employment Development, she appointed a bunch of Tory partisans with no qualifications to the Human Rights Commission and I think the Workplace Safety Commission. Mike Murphy went on a lengthy rant about it and listed off a bunch of occupations that would be suitable backgrounds for the appointment and said something along the lines of "we don't need dog catchers, garbage men and weather girls deciding on workplace accidents and discrimination cases". She, a former weather news broadcaster, claimed Murphy was making a personal and sexist attack by criticising the qualifications of female weather broadcasters. The story about the bad appointments went away and "weathergirl" became the story.
Just now, she was taking heat for making a ridiculous accusation that the Minister responsible for the Status of Women was incompetent and should resign because she was allowing the Liberals to bring in policies that would give cash only to full time university students, arguing that it is discriminatory against single mothers who can only go to school part time. So she has seized on the Barbie comment despite the fact that it is widely used as a name for her around the legislature by men and women alike of all parties and by herself.
Enough is enough. She has the distinction of being one of two ministers ever dropped from a Bernard Lord cabinet over the course of more than 7 years. I think you can imagine why.
Still working on finishing up my lengthy ramblings on the New Brunswick budget and will hopefully finish them today as the premier will be wrapping up the budget debate tomorrow. For my thoughts on the federal budget, please see Calgary Grit as we seem to be on the same page.
Tuesday, March 20, 2007
NB Budget parts 2.5 and 3
In my second budget post the other day, I claimed I was going to cover capital/infrastructure spending and didn't, however it doesn't really fit in with "part 3" so I will carry on where I left off in Part II first and then get in to Part III.
Capital Spending
Traditionally we actually have two budgets in New Brunswick. The Capital Budget (i.e. construction) is introduced in the fall to allow time for tenders to go out so construction can begin at first thaw. Then the ordinary budget comes out in March. However, as was the case in 2000 after Lord took office, and again this time after the Liberals took office in October 2006, the capital budget was delayed to coincide with the main budget.
Most capital expenditures fall under two departments: Supply & Services, which builds almost all of the buildings for government, including schools and hospitals and Transportation, which builds roads.
Here is the breakdown by department with capital spending:
Agriculture & Aquaculture
$400,000
Education
$1,000,000
Health
$10,000,000
Local Government
$500,000
Natural Resources
$2,436,000
Regional Development
$15,200,000
Supply & Serivces
$101,298,000
Tourism & Parks
$500,000
Transportation
$724,350,000
So capital expenditure under the Transportation department accounts for 85% of all capital spending and an impressive 10% of all government spending period. Building roads is a good thing and I am glad to see this figure. However, unfortunately, this isn't all going into roads. More than half of it, $408,800,000, will be paid to the road builders of the Grand Falls-Woodstock highway upon compeletion as part of the agreement drafted by the former government.
Here is how the big ticket items break down:
Transportation:
General Bridges $25,000,000
General Roads $49,500,000
Rural Roads $20,000,000
Canada-New Brunswick highway agreements (TCH mostly) $573,562,000
Border Upgrades (St. Stephen-Calais bridge mostly) $38,000,000
Routes 11 & 17 $5,000,000
Urban Bypasses (Marysville/Route 8 mostly) $6,288,000
Vehicles for the government fleet (including maintenance of existing fleet, fuel, etc) $7,000,000
Supply & Services:
New construction for Agriculture & Aquaculture, Education and Health $67,569,000
Maintenance of old facilities for Education, Health, Legislative Assembly, Post-Secondard Education, Training & Labour and Supply & Services $30,979,000
Others:
Marshlands (Agriculutre & Aquaculture)
Equipment for schools (Education)
Equipment for hopsitals (Health)
Improvements in unincorporated areas (Local Government)
Musquash Watershed and NB Trails (Natural Resources)
General capital projects, funds to top of the provincial share of gas-tax funded infrastructure, and infrastructure under the Canada-New Brunswick Rural Municipal agreement (Regional Development)
General improvements (Tourism & Parks)
This all seems pretty standard and reasonable.
Now for.... Budget Retrospective, Part III
For my next installment on reviewing the budget, I will be looking at "whether or not the budget really is balanced".
When is a budget balanced?
That should be a fairly easy question, but sadly it is not. Let's take a look at the past few budgets for an example:
2007-08:
Revenue: $6,811,506,000
Expenditure: $7,167,486,000
Difference: -$355,980,000
Stated Surplus (Deficit): $37,097,000
2006-07:
Revenue: $6,258,293,000
Expenditure: $6,345,284,000
Difference: -$86,991,000
Stated Surplus (Deficit): $22,224,000
2005-06:
Revenue: $6,109,314,000
Expenditure: $6,105,325,000
Difference: $3,989,000
Stated Surplus (Deficit): $98,880,000
2004-05 (This budget had the inspiring title "Living Within Our Means")†:
Revenue: $5,877,004,000
Expenditure: $5,877,581,000
Difference: -$577,000
Stated Surplus (Deficit): $54,281,000
2003-04:
Revenue: $5,515,807,000
Expenditure: $5,620,843,000
Difference: -$105,036,000
Stated Surplus (Deficit): $7,464,000*
The Auditor General rejected this figure saying, regardless of any accounting measure, the best real picture was a deficit of $101,036,000.
2002-03:
Revenue: $5,355,426,000
Expenditure: $5,414,074,000
Difference: -$58,648,000
Stated Surplus (Deficit): $21,352,000*
The Auditor General rejected this figure saying, regardless of any accounting measure, the best real picture was a deficit of $58,648,000.
2001-02:
Revenue: $5,170,492,000
Expenditure: $5,135,736,000
Difference: $34,756,000
Stated Surplus (Deficit): $34,756,000
2000-01:
Revenue: $4,834,833,000
Expenditure: $4,813,542,000
Difference: $21,291,000
Stated Surplus (Deficit): $21,291,000
1999-00:
Revenue: $4,779,097,700
Expenditure: $4,766,852,300
Difference: $12,235,400
Stated Surplus (Deficit): $42,245,400
As you can see, of the last 8 budgets, only 2 of them have stated their surplus/deficits with the magic formula of SURPLUS = REVENUE - EXPENDITURE. In fact, the Liberals, while in opposition, went so far as to try to embarrass the government by passing a motion which said, "a deficit occurs when expenditures in a fiscal year are greater than its revenues." By that standard, this budget is in the red and running a deficit of $355 million.
However, looking at the numbers above, you will see that in 1999-2000, 2000-2001 and 2001-2002 the budget was, more-or-less, in sync with the magic formula of SURPLUS = REVENUE - EXPENDITURE. If 2002-2003 and 2003-2004 this was true as well if you take the word of myself and the Auditor General. The Tories used some fuzzy math in these years, which the AG rejected, in which they argued that money they had paid down on the debt in previous years could instead by accounted as being carried over so, essentially, they accounted for the surpluses of previous years twice - first by calling it a surplus in the previous year and paying it on the provincial debt and second by saying that if they were not increasing the debt by more than they decreased it in previous years, they were simply carrying the money over for future use.
However, all of this changed with 2004-2005. This is when the previous PC government, under the recommendation of the Public Sector Accounting Board, an arm of the Chartered Accounts of Canada, changed the accounting of capital assets. The explanation released by the Finance Department at the time explains the justification for this.
I am much more comfortable, in general, with the magic formula of SURPLUS = REVENUE - EXPENDITURE. However, I am not an accountant and this is an accounting matter. If two New Brunswick Auditors General, a PC and Liberal government, the Chartered Accounts of Canada, the Goverment of Canada and the governments of most provinces are okay with it, I guess I should wake up and smell the coffee that has been brewed by the experts.
There is one noticable benefit to this accounting measure. In recent years, as running a deficit has become a horrible sin for governments, the amount of infrastructure construction and improvement has been cut like everything else which would, if not turned around, put us in dire straights in a few years when this infrastructure begins to fail.
Since this measure has come into place, the capital budget of New Brunswick has gone up considerably, which I think is a good thing, and this has been offset in the books by this expert designed and approved accounting method.
This in particular explains why this year their is such a difference between "SURPLUS = REVENUE - EXPENDITURE" and the stated surplus of the government; the expenditure includes A LOT of capital construction and improvement and that is offset, in part, by the accounting measure.
So, is this budget balanced? According to the experts, yes. According to arithmetic and the motion passed by both parties in 2005, no.
I think I will err with the experts and declare this a balanced budget.
Capital Spending
Traditionally we actually have two budgets in New Brunswick. The Capital Budget (i.e. construction) is introduced in the fall to allow time for tenders to go out so construction can begin at first thaw. Then the ordinary budget comes out in March. However, as was the case in 2000 after Lord took office, and again this time after the Liberals took office in October 2006, the capital budget was delayed to coincide with the main budget.
Most capital expenditures fall under two departments: Supply & Services, which builds almost all of the buildings for government, including schools and hospitals and Transportation, which builds roads.
Here is the breakdown by department with capital spending:
Agriculture & Aquaculture
$400,000
Education
$1,000,000
Health
$10,000,000
Local Government
$500,000
Natural Resources
$2,436,000
Regional Development
$15,200,000
Supply & Serivces
$101,298,000
Tourism & Parks
$500,000
Transportation
$724,350,000
So capital expenditure under the Transportation department accounts for 85% of all capital spending and an impressive 10% of all government spending period. Building roads is a good thing and I am glad to see this figure. However, unfortunately, this isn't all going into roads. More than half of it, $408,800,000, will be paid to the road builders of the Grand Falls-Woodstock highway upon compeletion as part of the agreement drafted by the former government.
Here is how the big ticket items break down:
Transportation:
General Bridges $25,000,000
General Roads $49,500,000
Rural Roads $20,000,000
Canada-New Brunswick highway agreements (TCH mostly) $573,562,000
Border Upgrades (St. Stephen-Calais bridge mostly) $38,000,000
Routes 11 & 17 $5,000,000
Urban Bypasses (Marysville/Route 8 mostly) $6,288,000
Vehicles for the government fleet (including maintenance of existing fleet, fuel, etc) $7,000,000
Supply & Services:
New construction for Agriculture & Aquaculture, Education and Health $67,569,000
Maintenance of old facilities for Education, Health, Legislative Assembly, Post-Secondard Education, Training & Labour and Supply & Services $30,979,000
Others:
Marshlands (Agriculutre & Aquaculture)
Equipment for schools (Education)
Equipment for hopsitals (Health)
Improvements in unincorporated areas (Local Government)
Musquash Watershed and NB Trails (Natural Resources)
General capital projects, funds to top of the provincial share of gas-tax funded infrastructure, and infrastructure under the Canada-New Brunswick Rural Municipal agreement (Regional Development)
General improvements (Tourism & Parks)
This all seems pretty standard and reasonable.
Now for.... Budget Retrospective, Part III
For my next installment on reviewing the budget, I will be looking at "whether or not the budget really is balanced".
When is a budget balanced?
That should be a fairly easy question, but sadly it is not. Let's take a look at the past few budgets for an example:
2007-08:
Revenue: $6,811,506,000
Expenditure: $7,167,486,000
Difference: -$355,980,000
Stated Surplus (Deficit): $37,097,000
2006-07:
Revenue: $6,258,293,000
Expenditure: $6,345,284,000
Difference: -$86,991,000
Stated Surplus (Deficit): $22,224,000
2005-06:
Revenue: $6,109,314,000
Expenditure: $6,105,325,000
Difference: $3,989,000
Stated Surplus (Deficit): $98,880,000
2004-05 (This budget had the inspiring title "Living Within Our Means")†:
Revenue: $5,877,004,000
Expenditure: $5,877,581,000
Difference: -$577,000
Stated Surplus (Deficit): $54,281,000
2003-04:
Revenue: $5,515,807,000
Expenditure: $5,620,843,000
Difference: -$105,036,000
Stated Surplus (Deficit): $7,464,000*
The Auditor General rejected this figure saying, regardless of any accounting measure, the best real picture was a deficit of $101,036,000.
2002-03:
Revenue: $5,355,426,000
Expenditure: $5,414,074,000
Difference: -$58,648,000
Stated Surplus (Deficit): $21,352,000*
The Auditor General rejected this figure saying, regardless of any accounting measure, the best real picture was a deficit of $58,648,000.
2001-02:
Revenue: $5,170,492,000
Expenditure: $5,135,736,000
Difference: $34,756,000
Stated Surplus (Deficit): $34,756,000
2000-01:
Revenue: $4,834,833,000
Expenditure: $4,813,542,000
Difference: $21,291,000
Stated Surplus (Deficit): $21,291,000
1999-00:
Revenue: $4,779,097,700
Expenditure: $4,766,852,300
Difference: $12,235,400
Stated Surplus (Deficit): $42,245,400
As you can see, of the last 8 budgets, only 2 of them have stated their surplus/deficits with the magic formula of SURPLUS = REVENUE - EXPENDITURE. In fact, the Liberals, while in opposition, went so far as to try to embarrass the government by passing a motion which said, "a deficit occurs when expenditures in a fiscal year are greater than its revenues." By that standard, this budget is in the red and running a deficit of $355 million.
However, looking at the numbers above, you will see that in 1999-2000, 2000-2001 and 2001-2002 the budget was, more-or-less, in sync with the magic formula of SURPLUS = REVENUE - EXPENDITURE. If 2002-2003 and 2003-2004 this was true as well if you take the word of myself and the Auditor General. The Tories used some fuzzy math in these years, which the AG rejected, in which they argued that money they had paid down on the debt in previous years could instead by accounted as being carried over so, essentially, they accounted for the surpluses of previous years twice - first by calling it a surplus in the previous year and paying it on the provincial debt and second by saying that if they were not increasing the debt by more than they decreased it in previous years, they were simply carrying the money over for future use.
However, all of this changed with 2004-2005. This is when the previous PC government, under the recommendation of the Public Sector Accounting Board, an arm of the Chartered Accounts of Canada, changed the accounting of capital assets. The explanation released by the Finance Department at the time explains the justification for this.
I am much more comfortable, in general, with the magic formula of SURPLUS = REVENUE - EXPENDITURE. However, I am not an accountant and this is an accounting matter. If two New Brunswick Auditors General, a PC and Liberal government, the Chartered Accounts of Canada, the Goverment of Canada and the governments of most provinces are okay with it, I guess I should wake up and smell the coffee that has been brewed by the experts.
There is one noticable benefit to this accounting measure. In recent years, as running a deficit has become a horrible sin for governments, the amount of infrastructure construction and improvement has been cut like everything else which would, if not turned around, put us in dire straights in a few years when this infrastructure begins to fail.
Since this measure has come into place, the capital budget of New Brunswick has gone up considerably, which I think is a good thing, and this has been offset in the books by this expert designed and approved accounting method.
This in particular explains why this year their is such a difference between "SURPLUS = REVENUE - EXPENDITURE" and the stated surplus of the government; the expenditure includes A LOT of capital construction and improvement and that is offset, in part, by the accounting measure.
So, is this budget balanced? According to the experts, yes. According to arithmetic and the motion passed by both parties in 2005, no.
I think I will err with the experts and declare this a balanced budget.
Friday, March 16, 2007
Budget retrospective, part deux
I missed Jeannot Volpé's speech in response to the budget yesterday but the Tory criticism seems to largely focus how it "destroys" the legacy of the Bernard Lord government by undoing their tax cuts. I hate to agree in part to this statement, but as I said in my first budget post, the small business tax cuts were the only legitimate legacy Lord left New Brunswick and it is gone. However, especially having re-did the math, I don't think it is that bad on the personal income tax side or on the big corporate tax side. The problem rests with the small business tax hike which I strong oppose.
Anyway, moving into by budget retrospective, today I will cover departmental spending changes and capital/infrastructure spending.
Departments with spending going up
Agriculture & Aquaculture (+10%)
> Increase almost all in Agriculture programs
Energy (+47%)
> Increases across the board
Efficiency NB (+67%)
> Administrative costs do not increase, but program funding raises by 78%
Fisheries (+34%)
> Increase across the board
Intergovernmental Affairs (+13%)
> Administrative costs cut by 14% and Trade by 15%, but North American relations budget increased by 48%
Premier (+40%)
> According to the Liberals in the press, it is because some of Lord's staff's salaries were paid by other departments but all are paid by the Premier's Office for transparency. The Tories do not deny this, but say that that accounts for only half of the increase of $500,000. I wonder if the remainer may be Claudette Bradshaw's task force which is called a "premier's task force" and, unlike the Self-Sufficiency Task Force, isn't listed as a budget item under general government.
Departments with spending more or less the same
Attorney General (+1%)
Education (+6%)
Environment (-2%)
Executive Council (+2%)
Family & Community Services (+8%)
Finance (+3%)
Health (+7%)
Human Resources (virtually no change)
Justice & Consumer Affairs (+5%)
Local Government (+2%)
Natural Resources (+2%)
Post-secondary Education, Training & Labour (+4%)
Public Safety (+4%)
Supply & Services (+3%)
Tourism & Parks (+2%)
Transportation (+4%)
Wellness, Culture & Sport (virtually no change)
Departments with spending going down
Business New Brunswick (-23%)
> Decrease is all in "Business & Industry Development", which is slashed by 45%, while the adminstration of the department and monies for the population growth/immigration secretariat go up.
"General Government"(-13%)
> Cutting of the Advisory Council on Seniors ($216,000), decreasing the Public Service Internship Program by 38%, cutting Communications New Brunswick by 5%, no one-time expenditures for Harbour Clean-up and Credit Union stabalization,
Legislative Assembly (-24%)
> MLA committe stipends drop by over 7%, less cost for Elections' agencies because non-election year,
Regional Development (-21%)
> Cuts in actual departmental spending are only 1% and it is all focused on adminstration, the rest of the decrease is due to less capital and special spending this year due to the completion of projects.
So we see some unusually high jumps in a number of departments and some unusually high drops in a number of departments. Some are explained away rather easily. Energy is the top priority for the government and that explains the increases for the Energy Department, the Efficiency Agency and perhaps in part the hike for North American relations.
All New Brunswickers who whine about the salaries of MLAs should see they are taking part of the hit by having their committee "top up" payments cut by 7%.
Agriculture and Fisheries increases are inline with the Liberals longtime complaint that services for New Brunswickers in these areas declined improperly when the Tories merged the two departments.
I think that the Premier's Office increase is relatively fairly explained but I will be curious to see where the specific money is being spent when we see main estimates.
The problem comes up in the other priority of the government: job creation. Businss New Brunswick takes a big hit - the biggest in real cuts - of any department. Why? Regional Development, despite appearences, is not really cut but the BNB cuts on their own are unusual. Throw in the cuts to the Trade arm of Intergovernmental Affairs and one is left to wonder what the approach is and how it syncs with "making job creation a priority again".
Anyway, moving into by budget retrospective, today I will cover departmental spending changes and capital/infrastructure spending.
Departments with spending going up
Agriculture & Aquaculture (+10%)
> Increase almost all in Agriculture programs
Energy (+47%)
> Increases across the board
Efficiency NB (+67%)
> Administrative costs do not increase, but program funding raises by 78%
Fisheries (+34%)
> Increase across the board
Intergovernmental Affairs (+13%)
> Administrative costs cut by 14% and Trade by 15%, but North American relations budget increased by 48%
Premier (+40%)
> According to the Liberals in the press, it is because some of Lord's staff's salaries were paid by other departments but all are paid by the Premier's Office for transparency. The Tories do not deny this, but say that that accounts for only half of the increase of $500,000. I wonder if the remainer may be Claudette Bradshaw's task force which is called a "premier's task force" and, unlike the Self-Sufficiency Task Force, isn't listed as a budget item under general government.
Departments with spending more or less the same
Attorney General (+1%)
Education (+6%)
Environment (-2%)
Executive Council (+2%)
Family & Community Services (+8%)
Finance (+3%)
Health (+7%)
Human Resources (virtually no change)
Justice & Consumer Affairs (+5%)
Local Government (+2%)
Natural Resources (+2%)
Post-secondary Education, Training & Labour (+4%)
Public Safety (+4%)
Supply & Services (+3%)
Tourism & Parks (+2%)
Transportation (+4%)
Wellness, Culture & Sport (virtually no change)
Departments with spending going down
Business New Brunswick (-23%)
> Decrease is all in "Business & Industry Development", which is slashed by 45%, while the adminstration of the department and monies for the population growth/immigration secretariat go up.
"General Government"(-13%)
> Cutting of the Advisory Council on Seniors ($216,000), decreasing the Public Service Internship Program by 38%, cutting Communications New Brunswick by 5%, no one-time expenditures for Harbour Clean-up and Credit Union stabalization,
Legislative Assembly (-24%)
> MLA committe stipends drop by over 7%, less cost for Elections' agencies because non-election year,
Regional Development (-21%)
> Cuts in actual departmental spending are only 1% and it is all focused on adminstration, the rest of the decrease is due to less capital and special spending this year due to the completion of projects.
So we see some unusually high jumps in a number of departments and some unusually high drops in a number of departments. Some are explained away rather easily. Energy is the top priority for the government and that explains the increases for the Energy Department, the Efficiency Agency and perhaps in part the hike for North American relations.
All New Brunswickers who whine about the salaries of MLAs should see they are taking part of the hit by having their committee "top up" payments cut by 7%.
Agriculture and Fisheries increases are inline with the Liberals longtime complaint that services for New Brunswickers in these areas declined improperly when the Tories merged the two departments.
I think that the Premier's Office increase is relatively fairly explained but I will be curious to see where the specific money is being spent when we see main estimates.
The problem comes up in the other priority of the government: job creation. Businss New Brunswick takes a big hit - the biggest in real cuts - of any department. Why? Regional Development, despite appearences, is not really cut but the BNB cuts on their own are unusual. Throw in the cuts to the Trade arm of Intergovernmental Affairs and one is left to wonder what the approach is and how it syncs with "making job creation a priority again".
Wednesday, March 14, 2007
Budget retrospective, Part 1
REVISED
I was going to do up a big post today digesting some of the comments of others on the budget, crunching some of the numbers and offering some of my viewpoints. However, this is proving to be rather impossible to do all at once because the number crunching, at least in terms of income taxes, has been way more complicated than I would have thought and I have a lot more to say than I would have thought.
So, this will be the first in a multi-part series. In Part 1, I will cover the increasing taxes in the budget.
Future editions over the course of the next few days will cover departmental spending changes, capital/infrastructure spending, whether or not the budget really is balanced, did the Liberals *really* budget for all of their promises and what was the Grant Thornton report talking about when it said there would be a $300 million shortfall.
Before I get into the true meat of "Part 1", I am going to over a brief background on my thoughts on the budget which is relevant to this part and will be to all subsequent parts.
The budget, on the surface, has a surplus of $37.1 million. Therefore, some have argued, there could have been $37.1 million less in tax hikes or spending cuts or some combination of the two. I don't think that that is a valid argument. Finance Minister Victor Boudreau admitted in his budget presentation the following:
Now I have already taken the Liberal Party to task for cancelling the HST rebate. It was bad policy and I support its being cancelled, however the Liberals did say they would keep it during the campaign and today say they never made that promise. That is untrue and unfair. They should have admitted their mistake, and quite fairly thrown a lot of blame on the Tories for claiming the rebate was ready to go when they didn't actually plan to prepare it at all, and said "we're sorry but this has to go". Or at least kept their word and implemented the bad policy. Claiming they didn't make the promise to slither away from breaking a promise is not cool and I will not condone it.
However I see my friend Spinks is pinning to the Liberals a trio of items which he portrays as screwing the people. a) the aforementioned HST rebate cancellation, b) the income tax hike I will get into later and c) a lack of a cap on property tax assessments. The third one is unfair. The Liberals have never supported the cap because it is bad public policy and it doesn't make any sense at all. However, the Liberals have addressed the issues of raising property assesements by increasing the unconditional grant to our municipalities, something the Tories promised twice but instead slashed it and then froze it forcing the municipalities to up property taxes - their only other source of revenue. Boudreau's budget gives our cities, towns and villages an extra $1.3 million in transfers which should go a long way to addressing property tax increases.
So anyway, I got into a bit of a rant there, but now let's get into some of the research I have been able to do on the tax increases.
Part 1 - Tax Hikes
Raising taxes is never popular and I don't think any government of any stripe would do it unless they thought it was absolutely necessary because it is politically unpopular and dangerous. I'll begin with income taxes which are the most relevant to everyone because almost everyone pays them.
As I mentioned yesterday, each of New Brunswick's four tax brackets will see an increase. The first bracket, for income under $33,450, goes up 0.44 from 9.68% to 10.12%, the next bracket, for income up to $66,902, goes up 0.66 from 14.82% to 15.48%, the third bracket, for income up to $108,768, goes up 0.28 from 16.52% to 16.80% and the highest bracket, for income above $108,768, goes up 0.11 from 17.84% to 17.95%.
Now to explain how this works, if you make $109,000 you don't pay 17.95% on all of your income, you pay each portion at each threshold. So, if that was your income, you would pay the lowest rate on $33,450 of your earnings, the second rate on $33,452 of your earnings ($66,902-$33,450), the third rate on $41,866 of your earnings ($108,768-$66,902) and the top rate on the $232 you haven't already paid tax on. In addition to this, everyone gets the tax back on the first $8,061 you earned and a whole bunch of other possible deductions.
Before I get too deep in the number crunching, I want to point out one thing that has gone under-reported. The Liberals in this budget have brought back a measure that will save you money in years ahead. They have brought in bracket-indexing. So, in 2007, you pay taxes at the lowest rate for money up to $33,450. In 2008, that number will increase by the rate of inflation so you will pay the lower rate on more money. This is how it used to be but the Tories, not wanting to raise taxes but needing to do so anyway, undid this measure a few years back and essentially raised taxes through the back door.
So, let's see what effect this has on a variety of incomes. For simplicity sake, I have calculated this for a person filing a single income and having no deductions beyond the basic $8,061 claim.
If you made $30,000 this is how it would work out:
2006 provincial income taxes: $2123.70
2007 provincial income taxes: $2220.23
Increase: $96.53
2006 actual percent of income paid in provincial income tax: 7.08%
2007 actual percent of income paid in provincial income tax: 7.40%
Increase: 0.32%
I did the same for the following levels of income:
Now, according to the budget news release, "even with this measure, New Brunswick still has the lowest personal income tax burden in Atlantic Canada". Is this statement true? Yes and no.
Talking in a simple matter of tax brackets, it is not, but it already wasn't. For the lowest tax bracket, Nova Scotia was already below us at 8.79%. However, New Brunswick has the highest personal exemption of any of the Atlantic Provinces so it may equal out. Let's compare our poor guy who made $75,000 and took ahuge hit in this tax hike with an increase of nearly 3% half a percent.
In New Brunswick, at an income of $75,000 you will pay $8753.48 in 2006 and $9108.20
in 2007. Now assuming there are no tax hikes in the other Atlantic Provinces, here is what someone making the same income would pay:
Prince Edward Island: $8784.62
Nova Scotia: $9026.59
Newfoundland & Labrador: $9976.53
So the guy who makes $75,000 goes from being the lowest taxed in Altantic Canada tothe highest taxed! second highest taxed.
Not a lot of New Brunswickers make $75,000/year however. So let's compare our guy making the more average $30,000/year. In New Brunswick, in 2006 he'd pay $2123.70 and in 2007 he'll pay $2220.23.
Nova Scotia: $2026.69
Prince Edward Island: $2213.62
Newfoundland & Labrador: $2411.02
So the guy making $30,000/year gets dinged, relatively, too but not as much. He moves from the #2 spot to the #3 spot.
The benchmark that the New Brunswick Department of Finance uses is a family with 2 (I think) dependents and a joint income of $40,000, some of which can be transfered to a spouse if it is a single source. In that regard, we apparently were the lowest and continue to be the lowest but it would be too complicated for me to do the calculations to verify.
Now from coast-to-coast, just looking at tax brackets, this is were we fit in:
In the low bracket we move from fourth lowest to sixth, jumping ahead of PEI (9.8%) and Alberta (10% for all).
In the second bracket, we move from seventh lowest to eighth, jumping ahead of NS (14.95%).
In the third bracket, we move from fifth lowest to severth, jumping ahead of NS (16.67%) and PEI (16.7%).
In the fourth bracket*, we are unchanged, remaining as the ninth lowest.
*Note, not all brackets are the same or as numerous. BC has five brackets, and many provinces have only 3. These brackets match up roughly but not exactly. In the case of the majority of provinces which do not have a fourth bracket, all income above the $60-70,000 range is taxed at the same rate while in New Brunswick, BC and Saskatchewan a higher rate kicks in at around $100,000. Therefore, our fourth bracket compares to many provinces third bracket.
New Brunswick's personal exemption, which will now be indexed to inflation and therefore go up every year, is relatively generous, only BC and Alberta offer a higher excemption. Our lowest tax bracket is also very generous at ~$33,500 (and now increasing every year thanks to indexing) where most provinces are at around $29,000 to $31,000.
After this analysis, I am less pleased with these tax measures than I was before. While I do think that tax increases were the prudent thing to do, I think that the increases in brackets 3 and 4 should have been higher, and the increases in bracket 1 and 2 lower - perhaps non-existent. With Francis McGuire saying the key to our future is to get wages higher - comparable to Ontario -and with the guy making $75,000 seeing a 2.86% tax increase, things don't seem to match up very well. therefore, the guys making wages comparable to the middle class in Ontario - $60,000 to $70,000 - shouldn't be bearing the brunt of this tax increase, which they are. Someone making $50,000 sees their taxes go up 0.44% and someone making $75,000 goes up 0.47% while a millionaire only gets a 0.14% increase.
However, the Liberals did take great pains to say during the campaign that the era of income tax cuts would be over if they took office and they have been warning since they took office and particularly since Decemeber that tax hikes were a serious possibility. I don't think you can fault them for dishonesty in this measure, though I will now officially join the chorus of those who think this was a badly implemented tax increase. Though I will say again hooray from bracket indexing.
UPDATE: The numbers for taxes on income above $66,902 were wrong and have been corrected above and some of my comments adjusted as a result however those in the middle band of income are still the hardest hit - just not as hard as I thought - and most of my criticisms remain unchanged, though I am far more happy than I was yesterday.
Business taxes
The coroporate tax increase to me is not a big deal. It isn't really an increase at all but just a cancellation of the Tory reduction scheduled for 2007. Corporations will now pay the same tax for 2007 as they did in 2006. Moreover, New Brunswick remains a friendly tax environment for business with our rate remaining the fourth lowest in Canada. I have no problem whatsoever with this measure.
Now, when we get to the small business tax rate, I get a little angry. This rate was scheduled to drop to 1% from 1.5% on January 1, 2007 but will now increase to 5% instead. The ceiling from which you are defined as a small business will slip from $475,000 to $400,000. So as a result all small businesses will see their taxes increase 3.5% and for those poor bastards whose businesses make between $400,000 to $475,000 they will see their tax rate jump from the 1.5% small business rate to the 13% corporate rate. That is INSANE. A business that made $425,000 in 2006 and the same in 2007 will see their tax bill skyrocket from $6375 to $55,250. An increase of over 8 and a half times.
Notwithstanding this measure, New Brunswick still has one of the best tax systems for small buiness so this measure won't likely cause samll businesses to move elsewehere. However, the tax regime for small businesses was probably the only thing the Lord government ever did that I was 100% supportive of. It increased the ability of people to be innovative, inventive and entrepreunerial. They have been robbed of that in this budget and I am not very happy about it.
I was going to do up a big post today digesting some of the comments of others on the budget, crunching some of the numbers and offering some of my viewpoints. However, this is proving to be rather impossible to do all at once because the number crunching, at least in terms of income taxes, has been way more complicated than I would have thought and I have a lot more to say than I would have thought.
So, this will be the first in a multi-part series. In Part 1, I will cover the increasing taxes in the budget.
Future editions over the course of the next few days will cover departmental spending changes, capital/infrastructure spending, whether or not the budget really is balanced, did the Liberals *really* budget for all of their promises and what was the Grant Thornton report talking about when it said there would be a $300 million shortfall.
Before I get into the true meat of "Part 1", I am going to over a brief background on my thoughts on the budget which is relevant to this part and will be to all subsequent parts.
The budget, on the surface, has a surplus of $37.1 million. Therefore, some have argued, there could have been $37.1 million less in tax hikes or spending cuts or some combination of the two. I don't think that that is a valid argument. Finance Minister Victor Boudreau admitted in his budget presentation the following:
In late-February, the province received confirmation that because of significantly higher world zinc prices resulting from strong demand, which are expected to remain high, metallic minerals tax revenue will reach an unprecedented level. The value of zinc produced in New Brunswick increased from $408 million in 2005 to over $902 million in 2006. For 2007-2008, revenue from the metallic minerals tax of approximately $70 million is anticipated. In comparison, this revenue source has averaged $4 million annually over the past two decades. This is a significant, extraordinary development.Translation: We are getting off lucky because we have a resource commodity which has a high price, but this is not a cash cow for life and if we don't buckle down now, we'll have to see way bigger tax increases and spending cuts a few years down the road. Keeping the budget balanced and thus giving us breathing room going ahead is a good idea, we should not be running just barely in the black or barely in the red, the province has a debt to pay and at least one big source of revenue is going to disappear so just barely meeting our expenses is not good enough.
If current volume levels and prices are sustained, this could potentially translate into revenue windfalls over the next several years. This will not be long-lived, however, as the operating life of Brunswick Mines is expected to run its course by 2010.
Now I have already taken the Liberal Party to task for cancelling the HST rebate. It was bad policy and I support its being cancelled, however the Liberals did say they would keep it during the campaign and today say they never made that promise. That is untrue and unfair. They should have admitted their mistake, and quite fairly thrown a lot of blame on the Tories for claiming the rebate was ready to go when they didn't actually plan to prepare it at all, and said "we're sorry but this has to go". Or at least kept their word and implemented the bad policy. Claiming they didn't make the promise to slither away from breaking a promise is not cool and I will not condone it.
However I see my friend Spinks is pinning to the Liberals a trio of items which he portrays as screwing the people. a) the aforementioned HST rebate cancellation, b) the income tax hike I will get into later and c) a lack of a cap on property tax assessments. The third one is unfair. The Liberals have never supported the cap because it is bad public policy and it doesn't make any sense at all. However, the Liberals have addressed the issues of raising property assesements by increasing the unconditional grant to our municipalities, something the Tories promised twice but instead slashed it and then froze it forcing the municipalities to up property taxes - their only other source of revenue. Boudreau's budget gives our cities, towns and villages an extra $1.3 million in transfers which should go a long way to addressing property tax increases.
So anyway, I got into a bit of a rant there, but now let's get into some of the research I have been able to do on the tax increases.
Part 1 - Tax Hikes
Raising taxes is never popular and I don't think any government of any stripe would do it unless they thought it was absolutely necessary because it is politically unpopular and dangerous. I'll begin with income taxes which are the most relevant to everyone because almost everyone pays them.
As I mentioned yesterday, each of New Brunswick's four tax brackets will see an increase. The first bracket, for income under $33,450, goes up 0.44 from 9.68% to 10.12%, the next bracket, for income up to $66,902, goes up 0.66 from 14.82% to 15.48%, the third bracket, for income up to $108,768, goes up 0.28 from 16.52% to 16.80% and the highest bracket, for income above $108,768, goes up 0.11 from 17.84% to 17.95%.
Now to explain how this works, if you make $109,000 you don't pay 17.95% on all of your income, you pay each portion at each threshold. So, if that was your income, you would pay the lowest rate on $33,450 of your earnings, the second rate on $33,452 of your earnings ($66,902-$33,450), the third rate on $41,866 of your earnings ($108,768-$66,902) and the top rate on the $232 you haven't already paid tax on. In addition to this, everyone gets the tax back on the first $8,061 you earned and a whole bunch of other possible deductions.
Before I get too deep in the number crunching, I want to point out one thing that has gone under-reported. The Liberals in this budget have brought back a measure that will save you money in years ahead. They have brought in bracket-indexing. So, in 2007, you pay taxes at the lowest rate for money up to $33,450. In 2008, that number will increase by the rate of inflation so you will pay the lower rate on more money. This is how it used to be but the Tories, not wanting to raise taxes but needing to do so anyway, undid this measure a few years back and essentially raised taxes through the back door.
So, let's see what effect this has on a variety of incomes. For simplicity sake, I have calculated this for a person filing a single income and having no deductions beyond the basic $8,061 claim.
If you made $30,000 this is how it would work out:
2006 provincial income taxes: $2123.70
2007 provincial income taxes: $2220.23
Increase: $96.53
2006 actual percent of income paid in provincial income tax: 7.08%
2007 actual percent of income paid in provincial income tax: 7.40%
Increase: 0.32%
I did the same for the following levels of income:
- $50,000: +$220.90, +0.44% (10.26% vs. 9.82%)
- $75,000: +$354.72, +0.47% (12.14% vs. 11.67%)
- $100,000: +424.72, +0.42% (13.31% vs. 12.88%)
- $150,000: +494.88, +0.33% (14.79% vs. 14.46%)
- $250,000: +604.88, +0.24% (16.05% vs. 15.81%)
- $500,000: +879.88, +0.18%% (17.00% vs. 16.83%)
- $1,000,000: +$1429.88, +0.14% (17.48% vs. 17.33%)
Now, according to the budget news release, "even with this measure, New Brunswick still has the lowest personal income tax burden in Atlantic Canada". Is this statement true? Yes and no.
Talking in a simple matter of tax brackets, it is not, but it already wasn't. For the lowest tax bracket, Nova Scotia was already below us at 8.79%. However, New Brunswick has the highest personal exemption of any of the Atlantic Provinces so it may equal out. Let's compare our poor guy who made $75,000 and took a
In New Brunswick, at an income of $75,000 you will pay $8753.48 in 2006 and $9108.20
in 2007. Now assuming there are no tax hikes in the other Atlantic Provinces, here is what someone making the same income would pay:
Prince Edward Island: $8784.62
Nova Scotia: $9026.59
Newfoundland & Labrador: $9976.53
So the guy who makes $75,000 goes from being the lowest taxed in Altantic Canada to
Not a lot of New Brunswickers make $75,000/year however. So let's compare our guy making the more average $30,000/year. In New Brunswick, in 2006 he'd pay $2123.70 and in 2007 he'll pay $2220.23.
Nova Scotia: $2026.69
Prince Edward Island: $2213.62
Newfoundland & Labrador: $2411.02
So the guy making $30,000/year gets dinged, relatively, too but not as much. He moves from the #2 spot to the #3 spot.
The benchmark that the New Brunswick Department of Finance uses is a family with 2 (I think) dependents and a joint income of $40,000, some of which can be transfered to a spouse if it is a single source. In that regard, we apparently were the lowest and continue to be the lowest but it would be too complicated for me to do the calculations to verify.
Now from coast-to-coast, just looking at tax brackets, this is were we fit in:
In the low bracket we move from fourth lowest to sixth, jumping ahead of PEI (9.8%) and Alberta (10% for all).
In the second bracket, we move from seventh lowest to eighth, jumping ahead of NS (14.95%).
In the third bracket, we move from fifth lowest to severth, jumping ahead of NS (16.67%) and PEI (16.7%).
In the fourth bracket*, we are unchanged, remaining as the ninth lowest.
*Note, not all brackets are the same or as numerous. BC has five brackets, and many provinces have only 3. These brackets match up roughly but not exactly. In the case of the majority of provinces which do not have a fourth bracket, all income above the $60-70,000 range is taxed at the same rate while in New Brunswick, BC and Saskatchewan a higher rate kicks in at around $100,000. Therefore, our fourth bracket compares to many provinces third bracket.
New Brunswick's personal exemption, which will now be indexed to inflation and therefore go up every year, is relatively generous, only BC and Alberta offer a higher excemption. Our lowest tax bracket is also very generous at ~$33,500 (and now increasing every year thanks to indexing) where most provinces are at around $29,000 to $31,000.
After this analysis, I am less pleased with these tax measures than I was before. While I do think that tax increases were the prudent thing to do, I think that the increases in brackets 3 and 4 should have been higher, and the increases in bracket 1 and 2 lower - perhaps non-existent. With Francis McGuire saying the key to our future is to get wages higher - comparable to Ontario -
However, the Liberals did take great pains to say during the campaign that the era of income tax cuts would be over if they took office and they have been warning since they took office and particularly since Decemeber that tax hikes were a serious possibility. I don't think you can fault them for dishonesty in this measure, though I will now officially join the chorus of those who think this was a badly implemented tax increase. Though I will say again hooray from bracket indexing.
UPDATE: The numbers for taxes on income above $66,902 were wrong and have been corrected above and some of my comments adjusted as a result however those in the middle band of income are still the hardest hit - just not as hard as I thought - and most of my criticisms remain unchanged, though I am far more happy than I was yesterday.
Business taxes
The coroporate tax increase to me is not a big deal. It isn't really an increase at all but just a cancellation of the Tory reduction scheduled for 2007. Corporations will now pay the same tax for 2007 as they did in 2006. Moreover, New Brunswick remains a friendly tax environment for business with our rate remaining the fourth lowest in Canada. I have no problem whatsoever with this measure.
Now, when we get to the small business tax rate, I get a little angry. This rate was scheduled to drop to 1% from 1.5% on January 1, 2007 but will now increase to 5% instead. The ceiling from which you are defined as a small business will slip from $475,000 to $400,000. So as a result all small businesses will see their taxes increase 3.5% and for those poor bastards whose businesses make between $400,000 to $475,000 they will see their tax rate jump from the 1.5% small business rate to the 13% corporate rate. That is INSANE. A business that made $425,000 in 2006 and the same in 2007 will see their tax bill skyrocket from $6375 to $55,250. An increase of over 8 and a half times.
Notwithstanding this measure, New Brunswick still has one of the best tax systems for small buiness so this measure won't likely cause samll businesses to move elsewehere. However, the tax regime for small businesses was probably the only thing the Lord government ever did that I was 100% supportive of. It increased the ability of people to be innovative, inventive and entrepreunerial. They have been robbed of that in this budget and I am not very happy about it.
Tuesday, March 13, 2007
Victor Boudreau's big day
Folks, today is budget day. I will post more when the budget actually comes out this afternoon at 2.
The Liberals have taken great pains to stress that it will be balanced so I suspect it will be, unless they are completely crazy.
It will be interesting to see what, if any, new ideas are in there re: Self-Sufficiency or if they will be holding off on that until the Task Force final report comes out in April - which would mean major changes have to wait until the next budget in 2008. Speaking of which, Eugene at To Be Announced has a cute post about the proposal to sell bonds for economic development guaranteed by NB Liquor Corp.
I'll start updating shortly after 2 when the budget documents are released...
UPDATE 1
You can find all of the budget documents here.
UPDATE 2
There is a surlpus of $37.1 million. Huge economic growth last year thanks in large part to high zinc prices pushed the value of mineral production up 63.8 per cent to a record $1.5 billion. This is how they overcame to the forecast $300 million deficit by Grant Thorton in December along with cutting the HST rebate and cutting administrative costs.
New funding for five departments:
TAXES GOING UP
Bracket 1 goes up to 10.12% from 9.68%
Bracket 2 goes up to 15.48% from 14.82%
Bracket 3 goes up to 16.80% from 16.52%
Bracket 4 goes up to 17.95% from 17.84%
Click here for the current rates and the unchanged cut-offs. All New Brunswickers pay bracket 1, then if you make more than $33,450 you start paying bracket 2 on the income above and beyond that number and so on.
(edit, I must be dyslexic, if you read this over the course of a few minutes before I corrected my error, I had read the numbers backwards)
UPDATE 3
The tax increase is not all bad and may be negatived by other actions of the government. Our taxes remain the lowest in Atlantic Canada and the bracket rates are being re-indexed, eliminating the bracket creep brought in by the Tories a few years ago which allowed them to raise taxes without technically raising taxes and preventing New Brunswickers from seeing their real income from going down as tax rates will adjust with inflation thus relieving in the tax cycle what New Brunswickers lose through the course of the year thanks to higher cost of living.
Corporate taxes are raised marginally. The coroporate tax cut of 2006 will be a one year affair, as for the 2007 tax year it will return to 2005 levels. However the previous Lord corporate tax cuts are still in effect giving New Brunswick the fourth lowest corporate tax in Canada.
The small business tax is also going up marginally. I am not too upset about the first two tax increases, but this is a bad idea.
UPDATE 4
The province is following the federal government's lead and axing the program that allows foreigners to send in their receipts and get the sales tax that they paid while here back. I have no problem with this.
UPDATE 5
Spinks should be happy, a form of income splitting is coming. New Brunswick is following Ottawa's lead and allowing pension income to be split.
The Liberals have taken great pains to stress that it will be balanced so I suspect it will be, unless they are completely crazy.
It will be interesting to see what, if any, new ideas are in there re: Self-Sufficiency or if they will be holding off on that until the Task Force final report comes out in April - which would mean major changes have to wait until the next budget in 2008. Speaking of which, Eugene at To Be Announced has a cute post about the proposal to sell bonds for economic development guaranteed by NB Liquor Corp.
I'll start updating shortly after 2 when the budget documents are released...
UPDATE 1
You can find all of the budget documents here.
UPDATE 2
There is a surlpus of $37.1 million. Huge economic growth last year thanks in large part to high zinc prices pushed the value of mineral production up 63.8 per cent to a record $1.5 billion. This is how they overcame to the forecast $300 million deficit by Grant Thorton in December along with cutting the HST rebate and cutting administrative costs.
New funding for five departments:
- Health gets $127 million more (+6.6%)
- Education gets $47 million more (+5.7%)
- Family & Community Services gets $67.4 million (+8.4%) + a 3% increase to welfare rates
- Elizabeth Weir's Efficiency NB get $15.3 million more (+234%)
- Population Growth gets $1.8 million more (+167%)
TAXES GOING UP
Bracket 1 goes up to 10.12% from 9.68%
Bracket 2 goes up to 15.48% from 14.82%
Bracket 3 goes up to 16.80% from 16.52%
Bracket 4 goes up to 17.95% from 17.84%
Click here for the current rates and the unchanged cut-offs. All New Brunswickers pay bracket 1, then if you make more than $33,450 you start paying bracket 2 on the income above and beyond that number and so on.
(edit, I must be dyslexic, if you read this over the course of a few minutes before I corrected my error, I had read the numbers backwards)
UPDATE 3
The tax increase is not all bad and may be negatived by other actions of the government. Our taxes remain the lowest in Atlantic Canada and the bracket rates are being re-indexed, eliminating the bracket creep brought in by the Tories a few years ago which allowed them to raise taxes without technically raising taxes and preventing New Brunswickers from seeing their real income from going down as tax rates will adjust with inflation thus relieving in the tax cycle what New Brunswickers lose through the course of the year thanks to higher cost of living.
Corporate taxes are raised marginally. The coroporate tax cut of 2006 will be a one year affair, as for the 2007 tax year it will return to 2005 levels. However the previous Lord corporate tax cuts are still in effect giving New Brunswick the fourth lowest corporate tax in Canada.
The small business tax is also going up marginally. I am not too upset about the first two tax increases, but this is a bad idea.
UPDATE 4
The province is following the federal government's lead and axing the program that allows foreigners to send in their receipts and get the sales tax that they paid while here back. I have no problem with this.
UPDATE 5
Spinks should be happy, a form of income splitting is coming. New Brunswick is following Ottawa's lead and allowing pension income to be split.
What of the federal NDP?
I found a brief news piece I saw today very interesting, I'll quote it in its entirety:
I tend to blame the NDP's failure on Layton's all style, no substance appraoch but Martin seems to be saying the NDP needs to be bold in presenting its alternative positions rather than timid in fear of appearing too far to the left. He may be right, I am not sure.
The fact remains that the NDP has won seats in every province in Canada except for PEI. Yes, that includes in Quebec and in Alberta. Since 1979, they have represented 76 different ridings. Historical trends show that 2004 and 2006 were "perfect storm" scenarios for NDP gains, yet they managed to return only to their average rather than to the top tier of election results.
Everyone knows that Jack Layton is no Ed Broadbent, but the NDP has been shut out of Saskatchewan two elections in a row while Saskatchewan, as recently as 1997, housed over half of the federal NDP caucus. There is a complete disconnect between the NDP and its traditional supporters and base. The NDP of Jack Layton has one base: bleeding hearted silverspooned socialists and acedemics from urban centres. However, history has proved over and over that these are finnicky voters. They will jump to the Liberals - and have in the past - when the electoral situation is one that could see the Liberals take power in place of the Conservatives. It is these elections which kill the NDP and cut it back to its rural agrarian base. Oh wait, they don't have one anymore. Thanks Jack!
If the NDP don't come up with some bold ideas, it is only a matter of time until they are completely wiped out by a good Liberal election year. I thought that the NDP would be done in the next election but Dion's missteps and seeming inability to connect with voters may have been the NDP's reprieve, but it is only a temporary one.
The NDP, though a party I have never voted for and would not want to take power, has served a very useful purpose in being the conscience for parliament and the incubator of some of Canada's best progressive social programs. I do not want to see it die, but it is in dire straights.
New Democrats should be encouraged that one of their MPs is willing to admit this and they should act.
NDP MP Pat Martin says his party must make significant gains in the next federal election or be forced to admit it may never be anything more than a fringe player and end its 46-year existence. Despite a recent rise in fortunes for the NDP, the Winnipeg MP admitted his party has led a tenuous existence, allowing bold policies -- such as calling for free first degrees for college and university students -- to be hidden behind timid language. "So, the result has been to bore people into some kind of a stupor where nobody has any idea what we stand for anymore." A poor electoral result could leave the NDP with few options, Mr. Martin said, including, in the case of a minority government, a merger or coalition with the Liberals.As I wrote back in December, I don't think the NDP are doing very well at all. Layton was lauded for his "success" of winning 19 seats in 2004 and 29 seats in 2006. However, Alexa McDonough was considered a lackluster leader when she won 21 seats in 1997. That is 21 seats out of 301, while Layton's best has been 29 out of 308 very marginally better.
I tend to blame the NDP's failure on Layton's all style, no substance appraoch but Martin seems to be saying the NDP needs to be bold in presenting its alternative positions rather than timid in fear of appearing too far to the left. He may be right, I am not sure.
The fact remains that the NDP has won seats in every province in Canada except for PEI. Yes, that includes in Quebec and in Alberta. Since 1979, they have represented 76 different ridings. Historical trends show that 2004 and 2006 were "perfect storm" scenarios for NDP gains, yet they managed to return only to their average rather than to the top tier of election results.
Everyone knows that Jack Layton is no Ed Broadbent, but the NDP has been shut out of Saskatchewan two elections in a row while Saskatchewan, as recently as 1997, housed over half of the federal NDP caucus. There is a complete disconnect between the NDP and its traditional supporters and base. The NDP of Jack Layton has one base: bleeding hearted silverspooned socialists and acedemics from urban centres. However, history has proved over and over that these are finnicky voters. They will jump to the Liberals - and have in the past - when the electoral situation is one that could see the Liberals take power in place of the Conservatives. It is these elections which kill the NDP and cut it back to its rural agrarian base. Oh wait, they don't have one anymore. Thanks Jack!
If the NDP don't come up with some bold ideas, it is only a matter of time until they are completely wiped out by a good Liberal election year. I thought that the NDP would be done in the next election but Dion's missteps and seeming inability to connect with voters may have been the NDP's reprieve, but it is only a temporary one.
The NDP, though a party I have never voted for and would not want to take power, has served a very useful purpose in being the conscience for parliament and the incubator of some of Canada's best progressive social programs. I do not want to see it die, but it is in dire straights.
New Democrats should be encouraged that one of their MPs is willing to admit this and they should act.
Friday, March 09, 2007
US presidential politics
Things are starting to get pretty exciting in the US of A.
I'll start off with some lighthearted factoids that have caught my attention the past few weeks. The American republic likes to distance itself from the evils of George III and his decendants that occupy the the British throne but the elitism of their politics is quite striking. We've all heard the talk about the fact that a Bush or Clinton has been president or vice-president non stop since 1981. It is interesting to note however that should Hillary Clinton win the nomination and presidency in 2008, a frontrunner to face her in 2012 would be Jeb Bush, who would "probably be at the top of the pack right now... if he were 'Jeb Smith' instead of 'Jeb Bush'". In 2016, Jeb's charismatic son, George P. Bush, would be old enough to be president and it goes on and on...
Also interesting to note was this line in the same article, that the Republicans "had a Nixon, Bush or Dole on every ticket for a half-century"... that's right, take a look...
1952 - Eisenhower-Nixon
1956 - Eisenhower-Nixon
1960 - Nixon-Lodge
1964 - Goldwater-Miller
1968 - Nixon-Agnew
1972 - Nixon-Agnew
1976 - Ford-Dole
1980 - Reagan-Bush
1984 - Reagan-Bush
1988 - Bush-Quayle
1992 - Bush-Quayle
1996 - Dole-Kemp
2000 - Bush-Cheney
2004 - Bush-Cheney
2008 - ???
The Republicans need not fret however as their dynasty could well continue. Elizabeth Dole and maybe even Jeb Bush would be solid vice-presidential possibilities in 2008.
Now for a rundown of the actual race. I'll break by standing in the race, not by party.
The Big Six (i.e. the perceived frontrunners)
Senator Hillary Clinton (Democrat of New York)
The frontrunner to end all frontrunners - think Gary Hart in 88, Mario Cuomo in 92, Howard Dean in 04 - the point is that she is not a sure bet to win. That said, I think she probably will win the Democratic nomination and that is a real shame.
I have nothing against Hillary Clinton, the problem is that a lot of Americans do. A lot of examples can be found on a quick Google search of her high "negative" ratings among Americans. Most people have already made their minds up about the junior senator from New York about about half of eligible voters would never vote for her. That is a pretty strong hurdle to overcome were she to win the Democratic nomination.
Hillary Clinton is the perfect example of how the Democrats could give away what should be a sure trip to the White House in 2008, there is nothing in Karl Rove's playbook that would better motivate conservatives to come out to vote than a Hillary Clinton candidacy. I hope, for the world's sake, that the Democrats consider this and nominate someone else.
Hillary Clinton would get a very respectable 42%-45% of the vote were she to be the nominee. However no matter how good or bad her campaign was she would still get that same 42 to 45 and that isn't enough to win.
(Former) Senator John Edwards (Democrat of North Carolina)
John Edwards was on hell of a fast rising star. In 1999, he took his first political office - U.S. senator. A noted litigator, he was immediately named one of the key members of the "defence team" for Bill Clinton in his Senate impeachment trial. In 2000, he was - with John Kerry and Joe Lieberman - on the short list to be Al Gore's running mate. I think with the charasmatic southerner Edwards on the ticket, Gore would have carried Florida and several other close states like Tennessee (which is Gore's homestate which he lost by less than 4%) and maybe Missouri and Ohio. With a swing of just 163,143 in these four states (about the same by which Kerry lost just Ohio in 2004), Gore would have won the electoral college 334 to 204! Just one of them would have won him the election. Whoops.
Edwards went on to come out of nowhere and place a close second to John Kerry in the Iowa caucus and go on to win the South Carolina and Wisconsin primaries in 2004 and become the vice-presidential running mate for Kerry. He continues to build on his strength in Iowa where he outpaces bigger names Clinton and Obama in polls.
A lot of people say Edwards is running too liberal and that he has "changed" but his voting record in the Senate and his campaign in 2004 were quite liberal, he is just using stronger rhetoric.
Edwards I think has the best shot of beating Clinton for the nomination.
(Former) Mayor Rudy Guliani (Republican of New York)
Guliani is a hero to many many people in the United States for being, especially in contrast to George W. Bush, an ultra strong, firm and reassuring leader in the aftermath of the September 11, 2001 terrorist attacks. For this, he is awarded high standing in the polls.
He, however, has absolutely NO chance of winning the Republican nomination and would be much, much smarter if he were to run as an independent where I think he would have a reasonable shot of winning, certainly at least as good as Ross Perot ever did.
Instead however, he is facing the Republic primary and caucus goer, who are more conservative than the average Republican voter and far more conservative than the average American. However, Guliani, with the possible exception of some law-and-order issues, is far to the left of the average American.
As one election predicition prognosticator rightly pointed out:
I doubt Guliani will even remain in the race until the Iowa caucus, though perhaps he may shift gears and become an independent.
Senator John McCain (Republican of Arizona)
Only in America could a man be against gay marriage, against legal abortions and hugely pro-war and somehow not be deemed "conservative".
This is the John McCain dilemma. McCain's mistake was appealing to too many moderates. For decades the Democrats have had unpredictable nominations choosing all kinds of unsuspected candidates (Stevenson, Kennedy, McGovern, Carter, Dukakis, Clinton and Kerry were all way off the radar and came from nowhere) but Republicans always have an establishment candidate who wins. Ford held back Reagan in 76. Vice President Bush was easily nominated in 88. Bob Dole crushed his opposition in 96.
In 2000, John McCain shocked the Republican establishment by beating their candidate, George W. Bush, in the New Hampshire primary. Following it, he surged in the polls and was expected to win South Carolina after wish time his momentum would be almost impossible to stop. So the religious right mobilized, dug into McCain's conservative record and found some moderate items. They spun them as liberal and screamed bloody murder and convinced conservatives and moderates in South Carolina to abandon him. They used racist baits and all kinds of nasty tools to beat him and John McCain dared to respond by calling these right-wing Christian leaders "hate mongerers". Ever since he is anti-religion. Throw in the fact that he mused that repealing legal abortion might have some negative concequences because illegal abortions would happen and they would be unsafe. Ever since he is a crazy-go-nuts-ultra-left-wing dirty pro-choice liberal. Former Senate colleague Rick Sanatorium calls himself an anybody-but-McCain Republican - does this include backing the true liberal Guliani over him if it comes to that? Get real.
People also point out that on election day, John McCain will be 72. Age dogged the campaign of his friend Bob Dole when he ran for president at 72 and he would be older that Ronald Reagan was in 1980 and deemed too old by many (though younger than Reagan in his successful re-election in 1984).
Nothwithstanding this, McCain is the front runner for the Republican nomination and is gathering a lot of establishment support. He is a strong supporter of the Iraq War which, despite its unpopularity in general, remains popular among Republican primary voters. John McCain knows better than most that it is hard to beat the establishment candidate for the Republican nomination and I suspect he will be the winner.
Senator Barack Obama (Democrat of Illonois)
Barack Obama swore up and down everytime he had a chance from his keynote speech to the Democratic convention in 2004 clear through election day 2006 that there was NO WAY he would run for president in 2008. Here is a video sample. It was clear he was sincere so it is also clear that some positive poll numbers proved he is an opporunist. That will come back to haunt him.
I think running in 2008 is a HUGE mistake for Barack Obama. Even in 2016 he would be a relatively young presidential candidate at 55. Obama's record in the Illonois Senate is far to the left of Teddy Kennedy. In Canada, he would be on par with Svend Robinson. This does not sell with Americans. After being the first Black editor of the Harvard law review, he wrote a book - not as well known as his more recent politically correct book. Many argue that his African raised father and white Kansas mother have produced a child who is obviously of African decent but is not a "Black" in the sense that most Americans see it which is to be descended from slaves. Worse, in his earlier book he criticizes Blacks and says he does not identify with them. He also admits cocaine use. Bill Clinton got away with "not inhaling" marijuana but I doubt Americans would vote for an admitted coke user.
His liberal record and his past writings would be difficult, but not impossible, to overcome if he had a strong career in the Senate to back him up. Unfortunately for him, he became a U.S. senator in 2005 and has no such record. He could have been president of the United States if he waited but instead he will be so badly damaged in this primary cycle that he will never have that chance. A shame for such a intelligent and charasmatic figure but sometimes greed is hard to resist.
Like Guliani, I am not sure he will even stay in the race until the first primary votes.
(Former) Governor Mitt Romney (Repubilican of Massachusetts)
Mitt Romney was originally listed in the next category and I called this the "big five" rather than the "big six". However in the preceding weeks he has continued to grow as a serious candidate, especially when it comes to raising the all important money.
He has a long record of being a fiscal conservative an ideology that the mainstream of the Republican party has left and many argue explains their losses in 2006 as much as Iraq does. However his record as a conservative on other fronts is in question.
His father, a Michigan governor, was a frontrunner for the 1968 Republican presidential campaign before Nixon got into the race but made some controversial statements about Vietnam and had to withdraw. However the elder Romney, like his son, has some challenges because of religion. Unlike Guliani and McCain, his challenge is different. Romney is a Mormon. His religion is one that is not well understood and many claim is a cult. Notwithstanding this, of the big three, he seems to be playing best with Christian conservatives despite the fact he was pro-choice when he ran against Ted Kennedy for the Senate in 1994 and for governor of Massachusetes in 2002.
He has changed his mind and seems to be getting away with it. Romney has an outside chance of winning the nomination and, if he returns to his moderate streak, could win a Reagan sized majority.
Other serious contenders
Senator Joe Biden (Democrat of Deleware)
Joe Biden is my pick in the race. He has been a politician almost his whole life. The U.S. constitution requires senators to be at least 30 years old. He was elected to the Senate when he was 29. How'd he pull that off? His thirtieth birthday fell between election day and the first session of the new Senate.
He ran for president in 1988 and was making a strong showing and might have won the nomination after Gary Hart's campaign self-destructed. However, Michael Dukakis organizers followed him around taping his stump speech in which he often quoted the leader of the British Labor Party. The one time he forgot to cite the quote they released the tape and claimed he was plagarizing. He eventually had to drop out of the race and the Dukakis organizers got the boots put to them for the dirty tricks but the damage was done an Dukakis won the nomination.
He is a bright light and thinker in the Senate and was expected to be Secretary of State if John Kerry had won in 2004. Despite being a life-long politician, he has remained in touch with the common man by commuting to work from his home state of Deleware on public transit every day (it is just a one hour train ride to D.C.). He is currently chair of the Senate Foreign Relations Committee and will be getting a lot of face time as he holds hearings on the unpopular Iraq war for which he has a great solution - create a decentralized federation of three distinct states: one Shite, one Sunni and one Kurdish.
If Clinton and Edwards falter, he could be the nominee and if I were an American, he'd have my vote.
Senator Sam Brownback (Republican of Kansas)
Brownback is a dream candidate for the Christian right. He is attractive and charsimatic and not at all "scary" yet he shares all of their issues. Except for one. He is not anti-immgrant and doesn't support closing down borders and imposing dranconian anti-"alien" laws. For this, many on the right will not endorse him.
However, the right are having a hard time finding a good candidate and may settle on him. They should, if they did he could win the election and he would be the most socially conservative president in American history.
Let's hope they don't know what's best for them!
(Former) General Wesley Clark (Democrat of Arkansas)
Poor Wes Clark. John Kerry and John Edwards ended up as the 2004 Democratic ticket because of their surprise top finishes in the Iowa caucus well ahead of Howard Dean and Richard Gephardt who were supposed to win according to the polls. This happened because Dean and Gephardt ran some nasty attack ads against each other in fighting for the lead and Iowans just abandoned them both. Clark, who entered the race late, decided to skip Iowa and fight to finish second in New Hampshire. If he hadn't made that choice, I am convinced that it would have been him that benefited when Dean and Gephardt dropped and he would have won the nomination and maybe become president.
I think his campaign has no steam this time and the novelty of a former Republican retired general switching over because of disagreement with Bush's war policy having unique credibility to run against the Iraq War has passed. He is an attractive compromise candidate and could emerge as the winner but I don't see it.
(Former) Governor Jim Gilmore (Republican of Virginia)
Gilmore has not attracted much attention yet but is a good social conservative who could be one of many to get a big push from the religious right if they collase behind one candidate. If this candidate is Gilmore, he would instantly become a serious force.
(Former) Governor Mike Huckabee (Republican of Arkansas)
Like Bill Clinton a governor of Arkansas who was raised in the small town of Hope, Huckabee is running for president as a long shot. I think it is far less likely for him to rise to the top of the pack than it was for Clinton however.
He is a well liked social conservative with a strong network among religious leaders but he did the unforgivable when he was governor: raised taxes.
Notwithstanding this, if he were to get the backing of a substantial majority of the religious right, he would be a serious force.
(Former) Speaker and Representative Newt Gingrich (Republican of Georgia)
It remains unclear if Newt will run, but he is a hero to conservatives of all stripes and would be a formidible candidate. If he won the nomination, I think he would have a hard time winning the general election. Numerous affairs while chasing Clinton on the Lewinsky scandal, ultra conservative and resigning from Congress for misspending money does not a good general election candidate make.
Ironically, in my view, Gingrich would be a good president. His domestic policy might not be great but that is largely controlled by Congress. On foreign policy he is a true internationalist and would do a great job for the world.
Governor Bill Richardson (Democrat of New Mexico)
Richardson is an attractive candidate on paper. A successful governor in a swing state with federal legislative and cabinet experience and foreign affairs experience (ambassador to the UN under Clinton). However a good political resume is never a guarantee of being a good candidate in U.S. politics.
Richardson faces a number of challenges which may prove him not ready for primetime. There were some questions of his treatment of women and sexual harrassment claims; he had said for decades he was drafted to be a major league baseball player but has recently admitted this was untrue; he is hispanic and the organized African Americans in the Democratic Party are a strong force and will not want another minority group to eclipse them by getting on the party ticket.
Richardson will do moderately successful but will not win the nomination.
Long shots
(Former) Senator Mike Gravel (Democrat of Alaska)
He has been out of politics for a looooong time and is 78 years old. However, he is making a serious grassroots campaign similar to John McCain in 2000 and Howard Dean in 2004. He could, especially in a crowded field, surprise a lot of people in New Hampshire like Pat Buchanan in 1996 or John McCain in 2000. If McCain is seeming to be the presumed nominee, 78 might not seem too old and he could gain traction. But that is a pretty big long shot.
Gravel could score an upset first or second place in an early hotly contested primary or caucus where it only takes 20-30% to win but he will, of course, not be the nominee.
Senator Chuck Hagel (Republican of Nebraska)
Hagel is a really good guy and a common sense man. He is a conservative, but he is strongly against the Iraq War and doesn't like to play to the fringes. Although he would be an excellent president - and I would vote for him in a heartbeat if I could - he has no shot.
Representative Duncan Hunter (Republican of California)
Hunter is a little known congressman but he is the only social conservative in the Republican field who is "right" on all of the issues according to social conservatives. He hasn't seemed to get much traction but he could all of a sudden jump to the top of the pack if the stars align right. This is unlikely for Hunter however as Romney, McCain, Brownback and Huckabee all pick up substantial chunks of Christian Conservative support.
Representative Ron Paul (Republican of Texas)
The 1988 Libertarian candidate for president would be a pretty big stretch to win the nomination BUT there is always a chance.
(Former) Governor and Secretary Tommy Thompson (Republican of Wisconsin)
Tommy Thompson thought of running in 2000 and opted out to back Bush and was rewarded a spot in his first cabinet. Thompson sounds like a great candidate on paper - 4 term governor of a Democratic-leaning state - but he has some where between zero and no charisma so his victory would be quite unlikely.
Jokes
Senator Christopher Dodd (Democrat of Connecticut)
No charisma, no profile, no money, no chance.
Representative Dennis Kucinich (Democrat of Ohio)
Like in 2004, he'll be in for the long haul to get out his message but as the party has turned to the left - especially in terms of the Iraq War - his chance is even smaller.
(Former) Governor George Pataki (Republican of New York)
There is already another liberal Republican from New York who was a leader during 9/11. However people know his name, but you still have no chance to be the Republican nonimee.
Reverend Al Sharpton (Democrat of New York)
Everybody loves Al Sharpton a big heart and a great sense of humour but he has no votes to go with it.
Represesntative Tom Tancredo (Republican of Colorado)
This guy is running on three issues: immigration, immigration and immigration. As in "kick out all of the dirty Mexicans". He has a constituency and will probably go alright in some midwest and border states but, thankfully, he'll never win the nomination.
If he/she ran...
Mayor Michael Bloomberg (Independent of New York)
If Bloomberg ran it would be on ego and he would have no chance to win the election but it is being considered. He is a nominal Republican but governs like a Democrat (like his predeccesor Rudy Guliani) and would run as an Independent.
However, he could alter it significantly. He is well liked in New York City and that makes up about half of the population of New York state. Especially if Hillary Clinton is not the Democratic candidate he could carry New York. He could also probably carry New Jersey. Maybe some other states.
If he won New York and New Jersey (47 electoral votes) it would be impossible for a Democrat to win the election outright. However, it could make for a very interesting result because if no candidate has 270 electoral votes - a very likely happenstance if a third candidate had 47 - then the election goes undecided until January at which time the President would be elected by the House of Representatives - with each State getting 1 vote - and the Vice President by the Senate. This would guarantee a Republican president (because they hold a majority of seats in more states because the dominate in small states) but possibly a Democratic VP.
(Former) Vice President Al Gore (Democrat of Tennessee)
People have been talking about the possibility of Al Gore running for a long time. And it seems more and more likley that he will. A recent poll however showed that many think gore can't win.
However Richard Nixon was VP from 1952-1960 and went on to run for president in 1960 against a guy with almost no political experience. Nixon was far more qualified on paper but lost one of the closest elections in American history in large part due to lack of charisma. No one expected him to run in 1968 and, when he did, few thought he would have a chance.
Change "Richard Nixon" to "Al Gore" and add 40 years to the dates and you have the exact same story... Nixon won huge.
Secretary Condoleezza Rice (Republican of California)
It is awkward for Condi Rice to think about running for president especially as Secretary of State because that is a role in which you are supposed to be, at least a bit, non-partisan. However, there is growing talk that Dick Cheney might resign and that, if he does, she would be nominated to succeed him as VP. As VP she would be the instant frontrunner and would be free to campaign full time. She already does well in polls with no interest... it would be interesting to see if she ends up as a candidate in which case it would make the race hard to predict. Does a Black woman steal a lot of traditional Democratic voters? Does she hold on to Republican ones? Would be very interesting...
Anyway, I hope you enjoyed this run down. It will be an interesting race and I look forward to watching.
I'll start off with some lighthearted factoids that have caught my attention the past few weeks. The American republic likes to distance itself from the evils of George III and his decendants that occupy the the British throne but the elitism of their politics is quite striking. We've all heard the talk about the fact that a Bush or Clinton has been president or vice-president non stop since 1981. It is interesting to note however that should Hillary Clinton win the nomination and presidency in 2008, a frontrunner to face her in 2012 would be Jeb Bush, who would "probably be at the top of the pack right now... if he were 'Jeb Smith' instead of 'Jeb Bush'". In 2016, Jeb's charismatic son, George P. Bush, would be old enough to be president and it goes on and on...
Also interesting to note was this line in the same article, that the Republicans "had a Nixon, Bush or Dole on every ticket for a half-century"... that's right, take a look...
1952 - Eisenhower-Nixon
1956 - Eisenhower-Nixon
1960 - Nixon-Lodge
1964 - Goldwater-Miller
1968 - Nixon-Agnew
1972 - Nixon-Agnew
1976 - Ford-Dole
1980 - Reagan-Bush
1984 - Reagan-Bush
1988 - Bush-Quayle
1992 - Bush-Quayle
1996 - Dole-Kemp
2000 - Bush-Cheney
2004 - Bush-Cheney
2008 - ???
The Republicans need not fret however as their dynasty could well continue. Elizabeth Dole and maybe even Jeb Bush would be solid vice-presidential possibilities in 2008.
Now for a rundown of the actual race. I'll break by standing in the race, not by party.
The Big Six (i.e. the perceived frontrunners)
Senator Hillary Clinton (Democrat of New York)
The frontrunner to end all frontrunners - think Gary Hart in 88, Mario Cuomo in 92, Howard Dean in 04 - the point is that she is not a sure bet to win. That said, I think she probably will win the Democratic nomination and that is a real shame.
I have nothing against Hillary Clinton, the problem is that a lot of Americans do. A lot of examples can be found on a quick Google search of her high "negative" ratings among Americans. Most people have already made their minds up about the junior senator from New York about about half of eligible voters would never vote for her. That is a pretty strong hurdle to overcome were she to win the Democratic nomination.
Hillary Clinton is the perfect example of how the Democrats could give away what should be a sure trip to the White House in 2008, there is nothing in Karl Rove's playbook that would better motivate conservatives to come out to vote than a Hillary Clinton candidacy. I hope, for the world's sake, that the Democrats consider this and nominate someone else.
Hillary Clinton would get a very respectable 42%-45% of the vote were she to be the nominee. However no matter how good or bad her campaign was she would still get that same 42 to 45 and that isn't enough to win.
(Former) Senator John Edwards (Democrat of North Carolina)
John Edwards was on hell of a fast rising star. In 1999, he took his first political office - U.S. senator. A noted litigator, he was immediately named one of the key members of the "defence team" for Bill Clinton in his Senate impeachment trial. In 2000, he was - with John Kerry and Joe Lieberman - on the short list to be Al Gore's running mate. I think with the charasmatic southerner Edwards on the ticket, Gore would have carried Florida and several other close states like Tennessee (which is Gore's homestate which he lost by less than 4%) and maybe Missouri and Ohio. With a swing of just 163,143 in these four states (about the same by which Kerry lost just Ohio in 2004), Gore would have won the electoral college 334 to 204! Just one of them would have won him the election. Whoops.
Edwards went on to come out of nowhere and place a close second to John Kerry in the Iowa caucus and go on to win the South Carolina and Wisconsin primaries in 2004 and become the vice-presidential running mate for Kerry. He continues to build on his strength in Iowa where he outpaces bigger names Clinton and Obama in polls.
A lot of people say Edwards is running too liberal and that he has "changed" but his voting record in the Senate and his campaign in 2004 were quite liberal, he is just using stronger rhetoric.
Edwards I think has the best shot of beating Clinton for the nomination.
(Former) Mayor Rudy Guliani (Republican of New York)
Guliani is a hero to many many people in the United States for being, especially in contrast to George W. Bush, an ultra strong, firm and reassuring leader in the aftermath of the September 11, 2001 terrorist attacks. For this, he is awarded high standing in the polls.
He, however, has absolutely NO chance of winning the Republican nomination and would be much, much smarter if he were to run as an independent where I think he would have a reasonable shot of winning, certainly at least as good as Ross Perot ever did.
Instead however, he is facing the Republic primary and caucus goer, who are more conservative than the average Republican voter and far more conservative than the average American. However, Guliani, with the possible exception of some law-and-order issues, is far to the left of the average American.
As one election predicition prognosticator rightly pointed out:
Rudy is coasting on a vague concept of "leadership." Very few people know about his marriage to his second cousin, Regina Peruggi, its annullment 14 years later, his various public affairs, his marriage to (and later divorce from) actress Donna Hanover, and then his recent marriage to a divorced nurse, Judith Nathan. Giuliani's official Website does not mention his first two marriages or the fact that he has two children with Donna Hanover. That will all come up during 2007. Mark my words. Polls have repeatedly shown that almost no one outside New York knows that he has been very pro-choice, pro-gay, and pro-gun-control for years.Anyone who watches The West Wing will tell you that the least realistic thing they ever did was let Alan Alda's charcter - a liberal Republican from California - win the Republican nomination. Guliani is WAY to the left of Alda's character and it is just as unrealistic to imagine him as the Republican nominee.
I doubt Guliani will even remain in the race until the Iowa caucus, though perhaps he may shift gears and become an independent.
Senator John McCain (Republican of Arizona)
Only in America could a man be against gay marriage, against legal abortions and hugely pro-war and somehow not be deemed "conservative".
This is the John McCain dilemma. McCain's mistake was appealing to too many moderates. For decades the Democrats have had unpredictable nominations choosing all kinds of unsuspected candidates (Stevenson, Kennedy, McGovern, Carter, Dukakis, Clinton and Kerry were all way off the radar and came from nowhere) but Republicans always have an establishment candidate who wins. Ford held back Reagan in 76. Vice President Bush was easily nominated in 88. Bob Dole crushed his opposition in 96.
In 2000, John McCain shocked the Republican establishment by beating their candidate, George W. Bush, in the New Hampshire primary. Following it, he surged in the polls and was expected to win South Carolina after wish time his momentum would be almost impossible to stop. So the religious right mobilized, dug into McCain's conservative record and found some moderate items. They spun them as liberal and screamed bloody murder and convinced conservatives and moderates in South Carolina to abandon him. They used racist baits and all kinds of nasty tools to beat him and John McCain dared to respond by calling these right-wing Christian leaders "hate mongerers". Ever since he is anti-religion. Throw in the fact that he mused that repealing legal abortion might have some negative concequences because illegal abortions would happen and they would be unsafe. Ever since he is a crazy-go-nuts-ultra-left-wing dirty pro-choice liberal. Former Senate colleague Rick Sanatorium calls himself an anybody-but-McCain Republican - does this include backing the true liberal Guliani over him if it comes to that? Get real.
People also point out that on election day, John McCain will be 72. Age dogged the campaign of his friend Bob Dole when he ran for president at 72 and he would be older that Ronald Reagan was in 1980 and deemed too old by many (though younger than Reagan in his successful re-election in 1984).
Nothwithstanding this, McCain is the front runner for the Republican nomination and is gathering a lot of establishment support. He is a strong supporter of the Iraq War which, despite its unpopularity in general, remains popular among Republican primary voters. John McCain knows better than most that it is hard to beat the establishment candidate for the Republican nomination and I suspect he will be the winner.
Senator Barack Obama (Democrat of Illonois)
Barack Obama swore up and down everytime he had a chance from his keynote speech to the Democratic convention in 2004 clear through election day 2006 that there was NO WAY he would run for president in 2008. Here is a video sample. It was clear he was sincere so it is also clear that some positive poll numbers proved he is an opporunist. That will come back to haunt him.
I think running in 2008 is a HUGE mistake for Barack Obama. Even in 2016 he would be a relatively young presidential candidate at 55. Obama's record in the Illonois Senate is far to the left of Teddy Kennedy. In Canada, he would be on par with Svend Robinson. This does not sell with Americans. After being the first Black editor of the Harvard law review, he wrote a book - not as well known as his more recent politically correct book. Many argue that his African raised father and white Kansas mother have produced a child who is obviously of African decent but is not a "Black" in the sense that most Americans see it which is to be descended from slaves. Worse, in his earlier book he criticizes Blacks and says he does not identify with them. He also admits cocaine use. Bill Clinton got away with "not inhaling" marijuana but I doubt Americans would vote for an admitted coke user.
His liberal record and his past writings would be difficult, but not impossible, to overcome if he had a strong career in the Senate to back him up. Unfortunately for him, he became a U.S. senator in 2005 and has no such record. He could have been president of the United States if he waited but instead he will be so badly damaged in this primary cycle that he will never have that chance. A shame for such a intelligent and charasmatic figure but sometimes greed is hard to resist.
Like Guliani, I am not sure he will even stay in the race until the first primary votes.
(Former) Governor Mitt Romney (Repubilican of Massachusetts)
Mitt Romney was originally listed in the next category and I called this the "big five" rather than the "big six". However in the preceding weeks he has continued to grow as a serious candidate, especially when it comes to raising the all important money.
He has a long record of being a fiscal conservative an ideology that the mainstream of the Republican party has left and many argue explains their losses in 2006 as much as Iraq does. However his record as a conservative on other fronts is in question.
His father, a Michigan governor, was a frontrunner for the 1968 Republican presidential campaign before Nixon got into the race but made some controversial statements about Vietnam and had to withdraw. However the elder Romney, like his son, has some challenges because of religion. Unlike Guliani and McCain, his challenge is different. Romney is a Mormon. His religion is one that is not well understood and many claim is a cult. Notwithstanding this, of the big three, he seems to be playing best with Christian conservatives despite the fact he was pro-choice when he ran against Ted Kennedy for the Senate in 1994 and for governor of Massachusetes in 2002.
He has changed his mind and seems to be getting away with it. Romney has an outside chance of winning the nomination and, if he returns to his moderate streak, could win a Reagan sized majority.
Other serious contenders
Senator Joe Biden (Democrat of Deleware)
Joe Biden is my pick in the race. He has been a politician almost his whole life. The U.S. constitution requires senators to be at least 30 years old. He was elected to the Senate when he was 29. How'd he pull that off? His thirtieth birthday fell between election day and the first session of the new Senate.
He ran for president in 1988 and was making a strong showing and might have won the nomination after Gary Hart's campaign self-destructed. However, Michael Dukakis organizers followed him around taping his stump speech in which he often quoted the leader of the British Labor Party. The one time he forgot to cite the quote they released the tape and claimed he was plagarizing. He eventually had to drop out of the race and the Dukakis organizers got the boots put to them for the dirty tricks but the damage was done an Dukakis won the nomination.
He is a bright light and thinker in the Senate and was expected to be Secretary of State if John Kerry had won in 2004. Despite being a life-long politician, he has remained in touch with the common man by commuting to work from his home state of Deleware on public transit every day (it is just a one hour train ride to D.C.). He is currently chair of the Senate Foreign Relations Committee and will be getting a lot of face time as he holds hearings on the unpopular Iraq war for which he has a great solution - create a decentralized federation of three distinct states: one Shite, one Sunni and one Kurdish.
If Clinton and Edwards falter, he could be the nominee and if I were an American, he'd have my vote.
Senator Sam Brownback (Republican of Kansas)
Brownback is a dream candidate for the Christian right. He is attractive and charsimatic and not at all "scary" yet he shares all of their issues. Except for one. He is not anti-immgrant and doesn't support closing down borders and imposing dranconian anti-"alien" laws. For this, many on the right will not endorse him.
However, the right are having a hard time finding a good candidate and may settle on him. They should, if they did he could win the election and he would be the most socially conservative president in American history.
Let's hope they don't know what's best for them!
(Former) General Wesley Clark (Democrat of Arkansas)
Poor Wes Clark. John Kerry and John Edwards ended up as the 2004 Democratic ticket because of their surprise top finishes in the Iowa caucus well ahead of Howard Dean and Richard Gephardt who were supposed to win according to the polls. This happened because Dean and Gephardt ran some nasty attack ads against each other in fighting for the lead and Iowans just abandoned them both. Clark, who entered the race late, decided to skip Iowa and fight to finish second in New Hampshire. If he hadn't made that choice, I am convinced that it would have been him that benefited when Dean and Gephardt dropped and he would have won the nomination and maybe become president.
I think his campaign has no steam this time and the novelty of a former Republican retired general switching over because of disagreement with Bush's war policy having unique credibility to run against the Iraq War has passed. He is an attractive compromise candidate and could emerge as the winner but I don't see it.
(Former) Governor Jim Gilmore (Republican of Virginia)
Gilmore has not attracted much attention yet but is a good social conservative who could be one of many to get a big push from the religious right if they collase behind one candidate. If this candidate is Gilmore, he would instantly become a serious force.
(Former) Governor Mike Huckabee (Republican of Arkansas)
Like Bill Clinton a governor of Arkansas who was raised in the small town of Hope, Huckabee is running for president as a long shot. I think it is far less likely for him to rise to the top of the pack than it was for Clinton however.
He is a well liked social conservative with a strong network among religious leaders but he did the unforgivable when he was governor: raised taxes.
Notwithstanding this, if he were to get the backing of a substantial majority of the religious right, he would be a serious force.
(Former) Speaker and Representative Newt Gingrich (Republican of Georgia)
It remains unclear if Newt will run, but he is a hero to conservatives of all stripes and would be a formidible candidate. If he won the nomination, I think he would have a hard time winning the general election. Numerous affairs while chasing Clinton on the Lewinsky scandal, ultra conservative and resigning from Congress for misspending money does not a good general election candidate make.
Ironically, in my view, Gingrich would be a good president. His domestic policy might not be great but that is largely controlled by Congress. On foreign policy he is a true internationalist and would do a great job for the world.
Governor Bill Richardson (Democrat of New Mexico)
Richardson is an attractive candidate on paper. A successful governor in a swing state with federal legislative and cabinet experience and foreign affairs experience (ambassador to the UN under Clinton). However a good political resume is never a guarantee of being a good candidate in U.S. politics.
Richardson faces a number of challenges which may prove him not ready for primetime. There were some questions of his treatment of women and sexual harrassment claims; he had said for decades he was drafted to be a major league baseball player but has recently admitted this was untrue; he is hispanic and the organized African Americans in the Democratic Party are a strong force and will not want another minority group to eclipse them by getting on the party ticket.
Richardson will do moderately successful but will not win the nomination.
Long shots
(Former) Senator Mike Gravel (Democrat of Alaska)
He has been out of politics for a looooong time and is 78 years old. However, he is making a serious grassroots campaign similar to John McCain in 2000 and Howard Dean in 2004. He could, especially in a crowded field, surprise a lot of people in New Hampshire like Pat Buchanan in 1996 or John McCain in 2000. If McCain is seeming to be the presumed nominee, 78 might not seem too old and he could gain traction. But that is a pretty big long shot.
Gravel could score an upset first or second place in an early hotly contested primary or caucus where it only takes 20-30% to win but he will, of course, not be the nominee.
Senator Chuck Hagel (Republican of Nebraska)
Hagel is a really good guy and a common sense man. He is a conservative, but he is strongly against the Iraq War and doesn't like to play to the fringes. Although he would be an excellent president - and I would vote for him in a heartbeat if I could - he has no shot.
Representative Duncan Hunter (Republican of California)
Hunter is a little known congressman but he is the only social conservative in the Republican field who is "right" on all of the issues according to social conservatives. He hasn't seemed to get much traction but he could all of a sudden jump to the top of the pack if the stars align right. This is unlikely for Hunter however as Romney, McCain, Brownback and Huckabee all pick up substantial chunks of Christian Conservative support.
Representative Ron Paul (Republican of Texas)
The 1988 Libertarian candidate for president would be a pretty big stretch to win the nomination BUT there is always a chance.
(Former) Governor and Secretary Tommy Thompson (Republican of Wisconsin)
Tommy Thompson thought of running in 2000 and opted out to back Bush and was rewarded a spot in his first cabinet. Thompson sounds like a great candidate on paper - 4 term governor of a Democratic-leaning state - but he has some where between zero and no charisma so his victory would be quite unlikely.
Jokes
Senator Christopher Dodd (Democrat of Connecticut)
No charisma, no profile, no money, no chance.
Representative Dennis Kucinich (Democrat of Ohio)
Like in 2004, he'll be in for the long haul to get out his message but as the party has turned to the left - especially in terms of the Iraq War - his chance is even smaller.
(Former) Governor George Pataki (Republican of New York)
There is already another liberal Republican from New York who was a leader during 9/11. However people know his name, but you still have no chance to be the Republican nonimee.
Reverend Al Sharpton (Democrat of New York)
Everybody loves Al Sharpton a big heart and a great sense of humour but he has no votes to go with it.
Represesntative Tom Tancredo (Republican of Colorado)
This guy is running on three issues: immigration, immigration and immigration. As in "kick out all of the dirty Mexicans". He has a constituency and will probably go alright in some midwest and border states but, thankfully, he'll never win the nomination.
If he/she ran...
Mayor Michael Bloomberg (Independent of New York)
If Bloomberg ran it would be on ego and he would have no chance to win the election but it is being considered. He is a nominal Republican but governs like a Democrat (like his predeccesor Rudy Guliani) and would run as an Independent.
However, he could alter it significantly. He is well liked in New York City and that makes up about half of the population of New York state. Especially if Hillary Clinton is not the Democratic candidate he could carry New York. He could also probably carry New Jersey. Maybe some other states.
If he won New York and New Jersey (47 electoral votes) it would be impossible for a Democrat to win the election outright. However, it could make for a very interesting result because if no candidate has 270 electoral votes - a very likely happenstance if a third candidate had 47 - then the election goes undecided until January at which time the President would be elected by the House of Representatives - with each State getting 1 vote - and the Vice President by the Senate. This would guarantee a Republican president (because they hold a majority of seats in more states because the dominate in small states) but possibly a Democratic VP.
(Former) Vice President Al Gore (Democrat of Tennessee)
People have been talking about the possibility of Al Gore running for a long time. And it seems more and more likley that he will. A recent poll however showed that many think gore can't win.
However Richard Nixon was VP from 1952-1960 and went on to run for president in 1960 against a guy with almost no political experience. Nixon was far more qualified on paper but lost one of the closest elections in American history in large part due to lack of charisma. No one expected him to run in 1968 and, when he did, few thought he would have a chance.
Change "Richard Nixon" to "Al Gore" and add 40 years to the dates and you have the exact same story... Nixon won huge.
Secretary Condoleezza Rice (Republican of California)
It is awkward for Condi Rice to think about running for president especially as Secretary of State because that is a role in which you are supposed to be, at least a bit, non-partisan. However, there is growing talk that Dick Cheney might resign and that, if he does, she would be nominated to succeed him as VP. As VP she would be the instant frontrunner and would be free to campaign full time. She already does well in polls with no interest... it would be interesting to see if she ends up as a candidate in which case it would make the race hard to predict. Does a Black woman steal a lot of traditional Democratic voters? Does she hold on to Republican ones? Would be very interesting...
Anyway, I hope you enjoyed this run down. It will be an interesting race and I look forward to watching.
Tuesday, March 06, 2007
Collins wins, Scott leaves
Well folks, I don't think too many observers were suprised with the by-election win by Liberal Chris Collins in Moncton East. However, looking more indepth into the results, I think that there are some noteworthy trends.
I doubt Spinks will agree, but I thought these results were particularly good news for the NDP, to a lesser extent for the Liberals and bad-to-neutral news for the Tories.
The Liberals won, so how can it be better news for the NDP than the Grits? Because politics is a game of perception and beating expectations is the best perception of all. The Liberals are obviously going to be able to be quite gleeful that they won their first by-election test and that they took the former PC leader's seat but, everyone believed they were going to win and, traditionally, Moncton East is one of the strongest Liberal seats in the province.
For the NDP, things look quite rosy, relatively speaking. The NDP has never been strong in Moncton, so no one expected them to do well, however they nearly doubled their share of the popular vote vs. September (8.3% vs. 4.5%) and were the only party to get more real votes. Turn out in this by-election was 4509, down from 6964 last September, so you didn't need nearly as many votes to win. The Liberals actually received 201 fewer votes than in 2006, the Tories received a crazy 2308 fewer votes, while the NDP gained 54 votes. To me, this indicated that 2006 may have been the low water mark for the NDP and with a new leader, they could revert back to their traditional 10% of the popular vote province wide.
For the Tories, they had a party hack as a candidate and faced a Liberal "star" who is almost certain to join cabinet. It was a seat that in its entire existence from 1974 through the 1995 elections returned Liberal Ray Frenette by large margins and went to Lord only by modest margins when one factors in the typical "leader bump". Everyone expected them to lose so they met expectations so, in perception, it isn't really a loss. However the size of the loss is substantial though it may not be reported on. I expected Collins to win comfortably, but I would have never expected him to get 58% of the vote and a victory margin of 15%!
Let's look at past numbers: Frenette 74 - 59%; Frenette 78 - 56%; Frenette 82 - 51%; Frenette 87 - 70%; Frenette 91 - 53%; Frenette 95 - 61%; Lord 98 - 51%; Lord 99 - 66%; Lord 03 - 52%; Lord 06 - 55%; Collins 07 - 58%.
Collins numbers are equal to Ray Frenette's average (58.3%)... this seat didn't just edge to the Liberal column it has returned to its traditional Liberal status and will probably stay there for the forseeable future.
As for Collins future, I wouldn't be surprised to see him become Minister of Local Government (which is currently held by Finance Minister Victor Boudreau) in a not too distant shuffle. Maybe it will be a bit of a competition for him with Ontario Revenue Minister Michael Chan to see who can make the cabinet quicker. Chan was recently added to the Ontario cabinet just 13 days after his by-election win.
Now on to Andy Scott...
I was quite surprised to hear this news today. Wasn't Andy on the record a short time ago saying he was running again? Perhaps his departure may cause Bernard Lord to re-evaluate his plans for running in the next federal election?
I will be curious to see who emerges as the Liberal candidate to replace Scott. Dion is pushing for women candidates in winnable ridings so I expect there would be some encouragement for one to come forward here. Three come to mind, Anne Bertrand who was co-chair of Gerard Kennedy's campaign in the province and unsuccessfully sought the provincial nomination for Fredericton-Silverwood, Joan Kingston who is the premier's principal secretary and was a cabinet minister from 1997-1999, and Scott's wife Denise Cameron Scott who is as involved in politics as her husband and currently serves as deputy chief of staff in the office of the provincial government caucus.
I doubt Spinks will agree, but I thought these results were particularly good news for the NDP, to a lesser extent for the Liberals and bad-to-neutral news for the Tories.
The Liberals won, so how can it be better news for the NDP than the Grits? Because politics is a game of perception and beating expectations is the best perception of all. The Liberals are obviously going to be able to be quite gleeful that they won their first by-election test and that they took the former PC leader's seat but, everyone believed they were going to win and, traditionally, Moncton East is one of the strongest Liberal seats in the province.
For the NDP, things look quite rosy, relatively speaking. The NDP has never been strong in Moncton, so no one expected them to do well, however they nearly doubled their share of the popular vote vs. September (8.3% vs. 4.5%) and were the only party to get more real votes. Turn out in this by-election was 4509, down from 6964 last September, so you didn't need nearly as many votes to win. The Liberals actually received 201 fewer votes than in 2006, the Tories received a crazy 2308 fewer votes, while the NDP gained 54 votes. To me, this indicated that 2006 may have been the low water mark for the NDP and with a new leader, they could revert back to their traditional 10% of the popular vote province wide.
For the Tories, they had a party hack as a candidate and faced a Liberal "star" who is almost certain to join cabinet. It was a seat that in its entire existence from 1974 through the 1995 elections returned Liberal Ray Frenette by large margins and went to Lord only by modest margins when one factors in the typical "leader bump". Everyone expected them to lose so they met expectations so, in perception, it isn't really a loss. However the size of the loss is substantial though it may not be reported on. I expected Collins to win comfortably, but I would have never expected him to get 58% of the vote and a victory margin of 15%!
Let's look at past numbers: Frenette 74 - 59%; Frenette 78 - 56%; Frenette 82 - 51%; Frenette 87 - 70%; Frenette 91 - 53%; Frenette 95 - 61%; Lord 98 - 51%; Lord 99 - 66%; Lord 03 - 52%; Lord 06 - 55%; Collins 07 - 58%.
Collins numbers are equal to Ray Frenette's average (58.3%)... this seat didn't just edge to the Liberal column it has returned to its traditional Liberal status and will probably stay there for the forseeable future.
As for Collins future, I wouldn't be surprised to see him become Minister of Local Government (which is currently held by Finance Minister Victor Boudreau) in a not too distant shuffle. Maybe it will be a bit of a competition for him with Ontario Revenue Minister Michael Chan to see who can make the cabinet quicker. Chan was recently added to the Ontario cabinet just 13 days after his by-election win.
Now on to Andy Scott...
I was quite surprised to hear this news today. Wasn't Andy on the record a short time ago saying he was running again? Perhaps his departure may cause Bernard Lord to re-evaluate his plans for running in the next federal election?
I will be curious to see who emerges as the Liberal candidate to replace Scott. Dion is pushing for women candidates in winnable ridings so I expect there would be some encouragement for one to come forward here. Three come to mind, Anne Bertrand who was co-chair of Gerard Kennedy's campaign in the province and unsuccessfully sought the provincial nomination for Fredericton-Silverwood, Joan Kingston who is the premier's principal secretary and was a cabinet minister from 1997-1999, and Scott's wife Denise Cameron Scott who is as involved in politics as her husband and currently serves as deputy chief of staff in the office of the provincial government caucus.
Monday, March 05, 2007
Slow week politically speaking
Well this week the New Brunswick legislature and Canadian parliament are in recess for the March Break and I am battling a bad case of the flu. I may not post much this week but I am going to try to finish up a fairly comprehensive post about the U.S. presidential election I've been working on on-and-off since late January.
Also, some discussion has erupted over at Spink About It and To Be Announced (a good blog I've been reading more often lately and you should check out) about the New Brunswick Tory bill that would allow provincial officials to opt out of marrying same-sex couples. The Tories proposed the same bill in 2005, with Liberal support, and though it passed second reading, they allowed it to die on the order paper when House business was reset with the fall 2005 throne speech. The Tories did not bother to re-introduce the measure in the 2005-2006 session of the legislature.
I was going to reserve comment on this until after the second reading debate, which won't be until next Wednesday, March 14, and will comment with more detail then but for now, here are my preliminary thoughts.
1.) The optics of Tory MLA David Alward, a devoutly religious pastor's son, introducing this bill, whose Agriculture & Fisheries critic portfolio cannot be construed to have anything to do with gay marriage, instead of the Justice critic is bad.
2.) The Liberals supported this bill in 2005 when debate was still hot on this issue about the same time the federal parliament was voting on Bill C-38 to give national recognition to the court decisions in seven provinces legalizing gay marriage. I know for a fact that at least a few cabinet ministers are uncomfortable with this and with the topic being less controversial and a new election over 4 years from now, will they still back it? It would be hard for some members of that caucus to oppose it and a free vote would all but ensure it would pass (assuming all 25 Tories voted for it) which would be pretty embarassing if a majority of the government caucus/cabinet was opposed.
3.) This bill is bad policy. Like it or not, same-sex marriage is the law of the land and it is the job of government officials to implement the law of the land. Period. Full stop. Spinks suggests that this is a good thing because it protects ministers from having to perform marriages, however that is not what this bill is about, religious folk are already protected by federal statute.
4.) This bill has dangerous concequences. It just says, "a person who is authorized to solemnize marriage ... may refuse to solemnize a marriage that is not in accordance with that person's religious beliefs". What if that person's religious beliefs are that interracial couples cannot get married? They are free to turn them away under this law.
UPDATE
One thing I forgot to mention which certainly doesn't qualify as "slow" is the Moncton East by-election tonight. The results will appear at the Elections NB site once all polls are reporting. If I can find poll-by-poll results sooner, I will post them but encourage anyone reading that may have them to post them in the comments.
Also, some discussion has erupted over at Spink About It and To Be Announced (a good blog I've been reading more often lately and you should check out) about the New Brunswick Tory bill that would allow provincial officials to opt out of marrying same-sex couples. The Tories proposed the same bill in 2005, with Liberal support, and though it passed second reading, they allowed it to die on the order paper when House business was reset with the fall 2005 throne speech. The Tories did not bother to re-introduce the measure in the 2005-2006 session of the legislature.
I was going to reserve comment on this until after the second reading debate, which won't be until next Wednesday, March 14, and will comment with more detail then but for now, here are my preliminary thoughts.
1.) The optics of Tory MLA David Alward, a devoutly religious pastor's son, introducing this bill, whose Agriculture & Fisheries critic portfolio cannot be construed to have anything to do with gay marriage, instead of the Justice critic is bad.
2.) The Liberals supported this bill in 2005 when debate was still hot on this issue about the same time the federal parliament was voting on Bill C-38 to give national recognition to the court decisions in seven provinces legalizing gay marriage. I know for a fact that at least a few cabinet ministers are uncomfortable with this and with the topic being less controversial and a new election over 4 years from now, will they still back it? It would be hard for some members of that caucus to oppose it and a free vote would all but ensure it would pass (assuming all 25 Tories voted for it) which would be pretty embarassing if a majority of the government caucus/cabinet was opposed.
3.) This bill is bad policy. Like it or not, same-sex marriage is the law of the land and it is the job of government officials to implement the law of the land. Period. Full stop. Spinks suggests that this is a good thing because it protects ministers from having to perform marriages, however that is not what this bill is about, religious folk are already protected by federal statute.
4.) This bill has dangerous concequences. It just says, "a person who is authorized to solemnize marriage ... may refuse to solemnize a marriage that is not in accordance with that person's religious beliefs". What if that person's religious beliefs are that interracial couples cannot get married? They are free to turn them away under this law.
UPDATE
One thing I forgot to mention which certainly doesn't qualify as "slow" is the Moncton East by-election tonight. The results will appear at the Elections NB site once all polls are reporting. If I can find poll-by-poll results sooner, I will post them but encourage anyone reading that may have them to post them in the comments.
Thursday, March 01, 2007
NDP MPs go completely nuts
You've got to see this to believe it...
Do you know what else Timmy? You'd have to be crazy to elect these morons to parliament too...
Do you know what else Timmy? You'd have to be crazy to elect these morons to parliament too...
Two comments from today's press
The New Brunswick Business Council, made up of the likes of New Brunswick super-businessmen David Ganong, Jim Irving, Allison McCain and Derek Oland, released a report yesterday making some recommendations to the Self-Sufficiency Task Force.
It is no secret that I am a fan of the concept behind Self-Sufficiency. It is a noble goal and something worth reaching for and I commend our big business people, who are doing just fine and don't really need to participate in this important debate, for taking the time to try to help move New Brunswick forward. Gents, this New Brunswicker appreciates your dedication to our province.
---
In the Gleaner and the T&T there is a big puff piece by Campbell Morrison about the New Brunswick Greens organizing for the federal election. In a relatively long article (438 words) he didn't both to devote one sentence to the fact that the Greens pledged about 6 months ago to found a party here in New Brunswick for provincial elections and that we haven't heard a peep since. I renew my challenge to menacing New Brunswickers - it would only take 10 of you - to found your own Green Party and hold the name for the lazy/disorganized bunch who haven't got around to it. Perhaps if the NDP is listening, this would be a really smart move for them.
It is no secret that I am a fan of the concept behind Self-Sufficiency. It is a noble goal and something worth reaching for and I commend our big business people, who are doing just fine and don't really need to participate in this important debate, for taking the time to try to help move New Brunswick forward. Gents, this New Brunswicker appreciates your dedication to our province.
---
In the Gleaner and the T&T there is a big puff piece by Campbell Morrison about the New Brunswick Greens organizing for the federal election. In a relatively long article (438 words) he didn't both to devote one sentence to the fact that the Greens pledged about 6 months ago to found a party here in New Brunswick for provincial elections and that we haven't heard a peep since. I renew my challenge to menacing New Brunswickers - it would only take 10 of you - to found your own Green Party and hold the name for the lazy/disorganized bunch who haven't got around to it. Perhaps if the NDP is listening, this would be a really smart move for them.
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