Tax cuts are good.
But, predictably, not everyone is happy with the ones just announced by the Tories. Naturally the socialists see no good in them at all - it’s all lost revenue and breaks for the rich and their evil corporations. Stéphane (the idiot) Dion muses about reversing the GST cuts. Though some economists do think that GST cuts are a mistake. Other, more sensible ones, like William Watson are more upbeat, concluding: "Keep it coming, Mr. Flaherty."
Not being an economist I don’t really follow the anti-GST-cut arguments. And even though he’s for the cut William Watson says: "cutting the GST may tilt people unproductively toward consumption". That’s one of the things I don’t get. If people tilt towards consumption don’t the producers have to ramp up production accordingly. Won’t increased production mean more jobs in the manufacturing, distribution and retailing sectors. Won’t increased production mean more profits to be re-invested in production or elsewhere. So, just how is more consumption "unproductive"?
Whatever. Mr. Watson’s column also hits on one of my pet peeves - the Canadian propensity for self-congratulation: "...the Economic Statement: Page 1: "Canada is the greatest country in the world." They said this in the Throne Speech too." It’s meaningless jingoism that reminds me of the new BC license plate motto: "The Best Place on Earth", which is embarrassingly meaningless jingoism. It ought to play really well on trips outside the province. As Watson observes everybody thinks they live in the best place, for one reason or another, otherwise they’d move.