Gift horse comes back to bite Harper
As the old quote attributed to Grace Hopper goes, “It’s easier to ask forgiveness than permission.” Whether it’s that house party you had without permission or the ding in the bumper of your dad’s car, keeping things on the down low as long as possible is an ancient and hallowed tradition for avoiding fallout.
Rather than feeling guilty, embrace the fact that you’re now in the company of the prime minister, gently swearing under your breath about the best laid plans gone awry.
Late Finance Minister Jim Flaherty worked tirelessly to achieve the federal government’s promise of delivering an administration that doesn’t operate at a financial loss by 2015, but that promise is becoming harder to keep by the day. Federal Finance Minister Joe Oliver has delayed the release of the federal budget until at least April, citing the plummet in oil prices as the cause.
Politics is a lot like throwing hand grenades: timing is everything.
When there’s good news to be delivered – like budget surpluses or funding announcements – it’s announced in a way to maximize the PR benefit for the government announcing it. There was speculation among financial experts that the budget deficit could actually be eliminated in the 2014 budget, as reported by the National Post back in 2013, however, the final numbers showed an $18.8 billion shortfall. Whether this could have been avoided is up for debate, but one thing is certain, eliminating the deficit in an election year is an awfully appealing prospect.
Unfortunately for Prime Minister Stephen Harper, he might have overplayed his hand. The unforeseen boom in shale oil production in the United States coupled with record outputs from Iraqi oil fields has driven down the price of crude oil by more than 50 per cent.
Canadian oil production was lucrative when the price exceeded $100 per barrel, but at roughly $48 per barrel, it’s barely worth pulling it out of the ground. If the speculation was true and the prime minister was delaying a budget surplus for election year, he may have just lost his chance to make good on that promise.
The federal government has been operating at a financial loss since the financial crisis of 2008, when the government’s spending exceeded its budget by nearly $6 billion. The full effect of the crisis wasn’t felt until the following year when government spending exceeded its income by a staggering $55 billion. The slump is comparable to what was experienced across the international markets at the time, and Harper’s government is credited with one of the most effective strategies for weathering the international recession that followed.
Ultimately though, it’s that same strategy that’s coming back to haunt the prime minister. Canada is known as a country that is rich in natural resources, including timber, precious metals and oil. It’s part of what provides for the generally high standard of living across the provinces. The same policies that allowed for a relatively stable gross domestic product have led to an economy that is disproportionately invested in oil.
Major international oil extraction companies are already pulling the plug on Canadian projects, and with no indication of a return to peak oil prices, Harper will be hard pressed to balance his books by election day.
Editorial opinions or comments expressed in this online edition of Interrobang newspaper reflect the views of the writer and are not those of the Interrobang or the Fanshawe Student Union. The Interrobang is published weekly by the Fanshawe Student Union at 1001 Fanshawe College Blvd., P.O. Box 7005, London, Ontario, N5Y 5R6 and distributed through the Fanshawe College community. Letters to the editor are welcome. All letters are subject to editing and should be emailed. All letters must be accompanied by contact information. Letters can also be submitted online by clicking here.
Rather than feeling guilty, embrace the fact that you’re now in the company of the prime minister, gently swearing under your breath about the best laid plans gone awry.
Late Finance Minister Jim Flaherty worked tirelessly to achieve the federal government’s promise of delivering an administration that doesn’t operate at a financial loss by 2015, but that promise is becoming harder to keep by the day. Federal Finance Minister Joe Oliver has delayed the release of the federal budget until at least April, citing the plummet in oil prices as the cause.
Politics is a lot like throwing hand grenades: timing is everything.
When there’s good news to be delivered – like budget surpluses or funding announcements – it’s announced in a way to maximize the PR benefit for the government announcing it. There was speculation among financial experts that the budget deficit could actually be eliminated in the 2014 budget, as reported by the National Post back in 2013, however, the final numbers showed an $18.8 billion shortfall. Whether this could have been avoided is up for debate, but one thing is certain, eliminating the deficit in an election year is an awfully appealing prospect.
Unfortunately for Prime Minister Stephen Harper, he might have overplayed his hand. The unforeseen boom in shale oil production in the United States coupled with record outputs from Iraqi oil fields has driven down the price of crude oil by more than 50 per cent.
Canadian oil production was lucrative when the price exceeded $100 per barrel, but at roughly $48 per barrel, it’s barely worth pulling it out of the ground. If the speculation was true and the prime minister was delaying a budget surplus for election year, he may have just lost his chance to make good on that promise.
The federal government has been operating at a financial loss since the financial crisis of 2008, when the government’s spending exceeded its budget by nearly $6 billion. The full effect of the crisis wasn’t felt until the following year when government spending exceeded its income by a staggering $55 billion. The slump is comparable to what was experienced across the international markets at the time, and Harper’s government is credited with one of the most effective strategies for weathering the international recession that followed.
Ultimately though, it’s that same strategy that’s coming back to haunt the prime minister. Canada is known as a country that is rich in natural resources, including timber, precious metals and oil. It’s part of what provides for the generally high standard of living across the provinces. The same policies that allowed for a relatively stable gross domestic product have led to an economy that is disproportionately invested in oil.
Major international oil extraction companies are already pulling the plug on Canadian projects, and with no indication of a return to peak oil prices, Harper will be hard pressed to balance his books by election day.
Editorial opinions or comments expressed in this online edition of Interrobang newspaper reflect the views of the writer and are not those of the Interrobang or the Fanshawe Student Union. The Interrobang is published weekly by the Fanshawe Student Union at 1001 Fanshawe College Blvd., P.O. Box 7005, London, Ontario, N5Y 5R6 and distributed through the Fanshawe College community. Letters to the editor are welcome. All letters are subject to editing and should be emailed. All letters must be accompanied by contact information. Letters can also be submitted online by clicking here.
