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The real budget deficits

Valerie Lannon and Jesse McLaren

March 26, 2016

While the Conservatives and corporate press is trying to create anxiety about the federal government’s financial deficit, the much bigger problem is the deficit between Trudeau’s rhetoric and reality on First Nations funding and climate action.

Financial ‘deficit’

The anxiety about the financial deficit is politically manufactured. As the Canadian Centre for Policy Alternatives’ Alternative Federal Budget makes clear, the Liberals could generate billions in revenue by reinstating corporate taxes to their 2006 levels, closing tax havens, implementing an inheritance tax for wealthy estates, and canceling subsidies for fossil fuel companies.

For those concerned about the financial deficit there’s a simple solution: reverse Harper’s cuts, and reduce the deficit by fulfilling the campaign promises of ending fossil fuel subsidies and taxing the rich. But the Liberals don’t want to really change Harper’s policies, so instead, they’re allowing these policies to continue and using the resulting deficit to claim they are spending lavishly on First Nations and the environment.

Deficit on First Nations funding

Child services advocate Cindy Blackstock and the Assembly of First Nations recently won a federal Human Rights Tribunal. The Tribunal agreed that the federal government has discriminated against First Nations by under-funding child and family services by 22-30% compared to services available “off reserve”.

Blackstock’s reaction to the federal budget: “Why I think the budget falls far short. The amount for child welfare this year is 71 million, that is 38 million less than what the Conservatives said was needed in 2012 (evidence showed the 109 fell far short of what was required). 54 per cent of the money allocated for child welfare will not come until the next election year or the year after the election. This year FN kids will receive 15 percent of the overall amount allocated for child welfare. Same back loading for education. In the line for ‘addressing immediate funding needs and program costs’ for education only 35 percent of funding comes before election year -65 percent for election year and year after. For transforming education, 68 percent comes election year or the year after. Forty percent of funds for schools also pegged for election year and year after. Overall, FN kids will only receive 11 percent of education announcement this year. Overall 50 percent of funds for education/schools pegged for election year (2018/19) or later.”

Activist scholar and blogger Pam Palmater has similar sentiments. Her writing the same day as the budget is entitled “Trudeau’s promises of ‘renewed relationship’ with First Nations evaporated with Liberal budget.”

As she explains, “First, it’s important to note that Trudeau’s budget plays a shell game on the actual funding commitment during his four-year (now three-and-a-half-year) mandate. As we all know, monies promised for future mandates are not monies at all. This budget promised $8.4 billion to First Nations, but is in fact, less than $5.3 billion… in the next three budget years. The $2.6 billion he promised First Nations for education is really only $1.15 billion. He failed to deliver on his own election promise to First Nations.”

Climate deficit

The same deficit between rhetoric and reality exists around the climate. Trudeau campaigned on ending fossil fuel subsidies, but instead will continue them—including a tax break for natural gas.

The budget section on “tax fairness” even justifies continuing the tax break as part of climate commitments, saying, “This treatment serves as an incentive to invest in new facilities that supply LNG to new markets. Consistent with Canada’s G20 commitment to eliminate fossil fuel subsidies over the medium term, the Government intends to maintain this tax preference as currently legislated and allow it to expire as scheduled.”

Not only will incentives for fossil fuels continue, the new budget gives an addition $50 million to oil and gas under the guise of promoting “clean growth economy”: “Developing Canada’s hydrocarbon resources in cleaner, more sustainable ways will be critical to enable the sector’s continuing contributions to Canadian prosperity. Budget 2016 proposes to provide $50 million over two years, starting in 2016–17, to Natural Resources Canada to invest in technologies that will reduce greenhouse gas emissions from the oil and gas sector.”

While Trudeau championed infrastructure, this only includes $3 billion over three years for public transit, mainly to upgrade existing networks. As well, most of the focus on green technology is for hybrid and electric cars, not mass transit.

Real change

If the government wants to bring real change, not the rhetoric of change, it should adopt the proposals of the campaign for a million climate jobs. This includes calls for $21.6 billion for public transit and $10.4 billion for high-speed rail, which would create thousands of jobs and significantly reduce carbon emissions.

If Trudeau wanted real change in the relationship with First Nations he would put his money where his mouth is. The budget gives $16.5 million to the National Energy Board, Natural Resources Canada and Transport Canada to “support public and Indigenous participation in enhanced consultations in projects undergoing reviews by the National Energy Board and to support Crown consultations with Indigenous people.”

Why not give this money directly to Indigenous communities like the Chippewas of the Thames First Nation, who are having to raise hundreds of thousands of dollars to challenge in the Supreme Court the lack of consultation over allowing tar sands pipelines to cross their territories?

Clearly Trudeau has a deficit when it comes to climate justice, and it’s up to the climate justice movement to close the gap between Trudeau’s rhetoric and reality.

Donate the Chippewas of the Thames legal fund.

Join the conference Ideas for Real Change: Marxism 2016, including the session “Climate Justice Now” with Myeengun Henry of the Chippewas of the Thames, oil sands worker Ken Smith, author and activist Judy Rebick, and climate justice activist Jesse McLaren; all proceeds from this meeting go to the Chippewas of the Thames. Register today and join/share on facebook.

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