This article first appeared in the Toronto Star on 20161106.
The prime minister’s governing style assumes one crucial thing — voters are willing to overlook large deficits. But for voters to happily stomach deficits, they must see results.
According to the Polimeter, an online application created by political scientists at Laval University, Prime Minister Justin Trudeau’s government has kept 24 per cent of the 353 campaign promises the Liberal Party made during the 2015 federal election campaign. He has broken five promises, which is about one per cent.
The Liberals pledged they would run short-term deficits of less than $10 billion in each of the next two fiscal years to fund investments in infrastructure and the middle class.
This week, in Finance Minister Bill Morneau’s fiscal update, the government doubled down. In its first year in office, the Trudeau government has racked up a deficit of nearly $31.8 billion.
The Laval analysis has highlighted that the number of promises kept entirely or in part (56 per cent) by this government far outweighs its predecessors’ average after one year (33 per cent).
The conscious decision to break the promise of ‘modest’ deficits has allowed the Trudeau government to remain on track with its other foundational promises. Simply put, the Trudeau government has broken one foundational promise to facilitate the progress of 348 others.
In the 2015 election, a plurality of voters was willing to accept that the new government would increase the debt.
On Tuesday, Morneau talked about the long term, announcing his plans for attracting foreign investment and creating an independent infrastructure bank. Strategically, the government eliminated the $6 billion annual contingency fund, making the government’s figures appear less overwhelming.
It is too early to tell if Canadians will remain as comfortable with this approach as they have been in the past. For now, the Liberals are still riding high in polls.
According to Nanos Research, one in two Canadians say they prefer Trudeau as Prime Minister, 16 per cent prefer interim Conservative Leader Rona Ambrose, and eight per cent prefer lame-duck NDP Leader Thomas Mulcair.
Political wisdom holds that to govern effectively, prime ministers have to make hard decisions, including ones that divide voters, shift governing philosophies and diminish voter goodwill.
Trudeau’s governing style may challenge this model.
Trudeau has positioned himself as a consensus-building, fiscally liberal politician who employs fact-based policy-making. As opposed to picking winners and losers, Trudeau tends avoid decisions that upset or let down large swaths of the population. Instead, he spends money to solve his policy problems and fulfil campaign promises.
This governing style assumes one crucial thing — that voters are willing to overlook large deficits. But for voters to happily stomach deficits, they must see results.
In its first year in office, the Trudeau government has approved a pipeline, increased funding for the Canadian Broadcasting Corporation, created 40,000 jobs for youth, taken in more than 30,000 refugees and cut the rate for the middle income tax bracket to 20.5 per cent from 22 per cent, addressing issues that spoke to the urban, young and educated voters who swung the election in the Liberals’ favour in 2015.
Moreover, people who cite the deficit as a determining factor when they vote are firmly within the Conservative Party tent and will likely never consider voting for Justin Trudeau.
The current government in Ontario is a case study in how deficits don’t necessarily affect a party’s electoral fortunes. The provincial Liberals have accumulated a significant amount of debt, leaving Ontario, astoundingly, as the world’s most indebted subnational government.
Yet, it’s not Ontario’s fiscal situation that is hurting the Liberal government. It is issues like high hydro prices — which seem to be a conversation topic around every dinner table these days — that seem to be threatening the Ontario Liberals’ long reign.
Ontario’s sky-high debt has been around for decades; it has yet to facilitate a changing of the guard.
Prime Minister Trudeau will continue to spend, and to give Canadians what they want and what he promised them. It would not be surprising to learn that his team has a comprehensive plan to execute, at least partially, on the remaining 152 promises before election 2019.
Stephen Harper’s government constantly warned voters that deficits would have dire consequences. The message fell on deaf ears.
Everything we’ve learned in Canadian politics in the last two decades has demonstrated voters do not care about the deficit, and our prime minister knows this better than anyone.
Jaime Watt is the executive chairman of Navigator Ltd. and a Conservative strategist.