Wednesday, March 23, 2011

The Budget Part 1

I've been called into work, so this only part of the budget. When I get some free time I'll finish it my critique and post it.

*Update* This post didn't get a lot of views and going through the budget is really boring, so I probably won't finish this critique.

Well the budget is out. Here's the first line from the first page:

“The global economy is emerging from the deepest and most synchronized financial and economic crisis since the Great Depression. Having learned from the mistakes of the 1930s, governments and central banks responded to the downturn with unprecedented fiscal and monetary stimulus. ”

I think you can see where it's going to go from here.

The Conservatives claim that “Budget 2011 supports job creation and continues to lay the foundation for sustainable economic growth. ” Let's examine if this is true:

$6.2 billion in personal income tax relief.

How about the elimination of income taxes? Aside from the fact that it's purely just slavery once removed, there are these problems

$8.3 billion in help for the unemployed. This includes additional EI benefits, lower EI premiums, and more training opportunities to help unemployed Canadians re-enter the workforce and prosper in the future.

I think the private sector would be adequate enough to help the unemployed. Keep taxes low and regulation to a minimum (if any at all) and entrepreneurs will be motivated be provide unemployment services on a free, voluntary market. This is more desirable considering that the State can only destroy wealth and violate private property rights.

$14.8 billion in infrastructure stimulus to create jobs.

A massive misallocation of resources. Profit-motive is always more efficient and effective than the arbitrary decisions made by politicians.

$3.8 billion to advance Canada’s knowledge economy.

How about $3.8 billion to educate Canadians on knowledge about the economy. This money should be enough to send every citizen a copy of Hazlitt's Economics In One Lesson.

$13.2 billion to support industries and communities.

Promoting up failed businesses and funding things better left to philanthropy. Let inefficient producers fail and cut taxes to allow individuals to spend their money as they see fit.

Extending Assistance for Canada’s Manufacturing and Processing Sector

The extension of the “capital cost allowance” program. Less efficient entrepreneurs who can't afford reinvestments in capital should rightly go out of business. This program prevents them from doing so.

Hiring Credit for Small Business

About $165 million in various ways to help small businesses. As ideal as this sounds no amount of credits or goodies will fix the layers of regulation entrepreneurs have to go through just to start their own business and hire employees. Everything from bureaucratic red tape to minimum wage prevents entrepreneurs from operating to their fullest capacity.

Extending the Work-Sharing Program

This one doesn't even sound good. Basically, this program gives benefits to employees willing to work a reduced work week because their employers can't afford to keep them on full-time. There is no return on this “investment.” The budget extends this program to the end of October and boosts its funding by another $10 million. In addition, attempts at fixing the bureaucratic red tape will be given a try.

Renewing Employment Insurance Pilot Projects

An additional $420 million on three EI programs that shouldn't exist to begin with. All these benefits do is prevent workers from moving into productive areas of the economy, at the expense of the everyone else. No doubt many people need EI and rely on it, especially during hard times – which is why private insurance is more desirable as it creates wealth for society and satisfies the consumer.

Extending the Targeted Initiative for Older Workers

$50 million to keep old people working. With youth unemployment so high, is there any rationality behind this program?

Expanding the Wage Earner Protection Program

No worries if your employer goes bankrupt and all your vacation pay and severance and etc. goes with it. The State is willing to steal from everyone to give you what you may believe its your right. Who was that politician that said he's entitled to his entitlements? Nevertheless, $4.5 million is being wasted on this program for 2011.

Supporting Mineral Exploration

Which will “cost” the government $90 million for the next couple years. It's basically a tax cut, so there's no complaints here. Plus, any jobs created from mining are real productive, wealth-producing jobs (as opposed to State infrastructure). Seeing that we're still in the early phases of this commodity bull market, all I have to say is: why stop at $90 million?

Limiting EI Premium Rate Increases and Launching EI Consultations

Increase in EI payments and an initiative to find out how to improve EI. For all the money and resources wasted on this process, the answer probably won't be what it should be: complete privatization.

Investing in a Cleaner Energy Economy

Straight out of the NDP platform. Something like $100 million for research into green technology and other “goodies” that are borderline fascist. Perhaps the conspiracy theorists are on to something when they say that the next genocide will voluntary because people, seeing the human race as a virus on the Earth, decide to kill themselves in an attempt to help the environment. This program, however, just deindustrializes the nation.

Maintaining Canada’s Financial Sector Advantage

Here's what the budget says: “Introducing legislation to reinforce the stability of Canadian housing finance and strengthen the mortgage insurance regime. ” That was the rationale when Flaherty insured all those mortgages back in 2008. It's clear that anything the State does in our financial sector will only avoid the bust and prolong the boom as long as possible.

Strengthening Canada’s Public Infrastructure

$2 billion for municipalities from the Gas Tax Fund (because that won't be wasted), $228 million to fix bridges in Montreal, $148 million to fix bridges for the rest of Canada (I think more provinces should have a separatist party), $72 million for harbours, $150 million for a highway in the Arctic.

Supporting Canadian Agriculture

$50 million for innovation (because clearly things like that just require more money), $17 million to prevent the spread of plum pox (no danger to consumers, according to Wikipedia. As for farmers, the voluntary sector would be far more efficient), $24 million to prevent disease in the hog industry (again, private enterprise can do a better job), $100 million to the Canadian Food Inspection Agency bureaucracy.

Supporting Forestry

$60 million for forestry companies, but nothing about privatizing crown land. See Walter Block's video for more information.

Windsor-Detroit Bridge

I really don't think we need another border bridge. Especially one that leads to Detroit. The city that is ground zero for economic collapse.

Supporting Young Entrepreneurs

Instead of giving The Canadian Youth Business Foundation $20 million, why not repel all the tax and regulatory disincentives that destroy profit-motive?

Reducing Red Tape for Small Business—BizPaL

This is what the budget says:

“Launched in 2006, BizPaL is a free online service that significantly reduces the red tape burden on small business owners by allowing them to quickly and efficiently create a tailored list of permits and licences that are required from all levels of government to operate their specific business. ”

Instead of giving BizPal $3 million, why not repel all the permits and licenses that are required for small business? Then there's no need for BizPal or the $3 million of stolen wealth. In addition, permits and licenses that are in place to protect consumers will arise in a free market (without coercion, of course) and thus employ even more people who aren't tax consumers.

Moving Forward With the Red Tape Reduction Commission

If I had a grave, I would be rolling in it right now. This is a bureaucratic commission to be set up to determine how to cut back on bureaucratic red tape. I could try to point out the absurdity, the irony or the out-right stupidity – but it would only make my head hurt. I would vote against this budget based solely on this point alone. No word on how much this boondoggle will cost.

Continuing to Improve Taxpayer Fairness

Everything but. The above-mentioned boondoggle plays a role in this too, so the whole initiative is pointless anyway.

Preventing Labour Disruptions

By throwing $1 million at the problem.

Strengthening Canada’s Standards System

$2.1 million for a crown corporation that in theory “helps to promote Canada’s economic growth through the pursuit of efficient and effective standardization.” But in reality just destroys wealth and slows economic growth.

Improving Military Procurement

No word on privatization (obviously), so (obviously) another waste of money.

To be continued....

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