Winnipeg Free Press

Winnipeg Free Press (Newspaper) - November 10, 1981, Winnipeg, Manitoba Winnipeg free november 1981 7 Maceachen must Cut his huge deficit finance minister Allan Maceachen prepares his budget against background of per cent unemployed and depressed sales of consumer durables and Ottawa steady some Quick Relief for those who need it a paring and a bit of Leger de finance minister Allan Mac each confronted now with a Sharp Down turn in the Canadian Economy As Well As double digit will Likely have to come up with a mix of All four of these ingredients when he rises in the commons to make his budget presentation on thursday economic observers Are agreed that the budget must above All else offer the Promise of reductions in the Federal deficit forecast at billion this year is the largest single cause of Canadas High inflation but most agree that the widening Sig nals of an imminent con firmed in a flurry of figures issued by statistics Canada will Force the minister to limit that an across the Board tax which Mac Eachen and others had strongly hinted would Likely come in the is being ruled it would reduce the rate of private and thus further slow Down the investment needed for economic looking at the no Mere mortal could want to step into Macea Chens shoes today inflation running at an annual rate of per cent official unemployment at an Al time High of and on the Rise october housing starts at a seasonally adjusted annual rate of half last years level car sales and sales of durables in Sharp and consumer Confidence slumping interest rates falling the encouraging of is that interest rates Are the Competition for which economists say was a principal Factor in the Rise of interest rates through the Early part of the has now so has the demand for goods which that Money the slump is the Price we the private unable to Cope with the Ever escalating Cost of borrowed reduced its borrowings and business activity the govern still in need of heavy amounts of has continued going to the Money but with much of the competitive pressure now off the Money sup the Bank rate which peaked at 21 per cent late this summer fallen Back to per in theory the economic slowdown itself should soon begin to squeeze some of the inflation out of the Economy with less Money chasing the available tight Money has begun doing what it was supposed to tight hits randomly and often the Cost As Mac Eachen and his advisers these Days look out across the nation has been it is no wonder that observers Are looking to the government to get its own House in either by tailoring its spending to meet its existing reve Nues or by increasing its revenues to reduce the pressures out in the mar what no one wants in thursdays budget is an expansionary course that will inflate the and again Over heat the it is widely agreed such a refuelling would Only Lead to More still higher interest rates and new disincentives to in an interview last Royal Bank of Canada vice president Joan Cohen Ottawa editor suggested today economic times Call for a very steady hand on fiscal until two years ago the finance departments assistant Deputy minister responsible for taxation poli would have the government move slowly in reducing its deficit than would some his guess is that with the Economy flagging Mac Eachen will Settle for the Bonus new revenues accruing from the revised National Energy program recently estimated at million for next year and modest additional tax achieved by removal of some tax con possibly obscure ones that had proved of Little economic in abandoning such Maceachen would at least set a tone of fiscal responsibility for the in Neufeldt View the deep cuts in the Federal deficit should occur in the Middle a bit further Down the the Best budget stance this he would be to achieve very Little Overall change in the governments account though there might be a series of adjustments in where the governments Money for Neufeld some additional Revenue Likely will be routed Back to the Public to Deal with politically sensitive such As High mortgage interest payments or to boost the level of housing he thinks that the budget is unlikely to do anything to reduce individual or corporate considering the in vestment needs that lie ahead and the need to keep some limit on the amount of foreign capital brought in for the economists at the Toront Odomin Ion Bank Are also expecting a far less restrictive budget than seemed to be in the cards a month or two Deputy chief economist James Webber Points out that one of the goals of the proposed tax then seemingly in the would have been to break Down the nations inflation psychology for to get people to save their Money rather than pumping it into consumer but this already has selective tax measures the Toronto Dominion people Are guessing that Maceachen May yet bring in tax measures aimed selectively at the pocketbooks of the most broadly targeted of such they would be re Moval of the Energy component of the consumer Price Index in income tax such a move would re Duce the Index level by a highly profit Able for the government percent age the Bank economists speculate this move May have been heralded in prime minister Trudeau warning to canadians that the govern ment would not protect them from the effects of Energy Price a second possible budget move would be a return to the pre1979 level of tax benefits tied to Canadian Stock dividend with the grossing up dropped from 50 per cent allowed Back to 33 per such a move would be in line with the prime ministers warning last month that the Burden of the restraint program would fall on those who could most afford the after do not own Many there Are signs in the air these Days including a to secret document ferreted out last week by tory front Bencher Sinclair Stevens that the government is much preoccupied with getting its Long heralded Industrial strategy through the drafting no one would be too surprised if a handful of measures appeared in the budget ostensibly to set the wheels of that strategy in a Lon sought tax write off for Money invested in High technology industries might be a training incentive scheme could be the general thrust of the strategy is already being applauded it commits the for to Back ing resource based and High tech in to an effective marketing to labor retraining programs and to an efficient transportation sys the strategy appears far from the leaked signed by Bud the minister of state for economic offers Only the Bare Bones of an and the government clearly has a lot of work ahead of still some Industry assisting incentive Normal in any might come this year specially dressed up As the first measures in a projected new Industrial and Why not Allan navigating through otherwise cheer less Waters thursday could do worse than throw out a shimmering thought or two to an inflation weary Public about the massive economic opportunities waiting for us All in the Harbor just More focus on Page 8 Senate veto idea antidemocratic by Wilson special to the free press Ottawa purpose was Clear when the current processor constitutional change was launched in the autumn of 1980 it was to Cement the federalist Victory in the referendum on sovereignty association which had been held in Quebec the previous it is against that initial which seemed so far away from the joyous outpourings in the Ottawa conference Centre last that the entire process and its results must be for the rest of the country there have been although respects these Are simply a matter of getting Back to the Point from which it All started after a process that was truly we have returned to the ways of Compromise and the search for consensus but that is Only a not a new some elements in the process and its results were More perhaps the most important of All is that the supreme court of Canada has Given the country a More authoritative definition of the Constitution than it has Ever had in the with great emphasis on the parts of it that Are unwritten but sometimes More important than those that have been formally put Down on in the after All the unwise Federal attempts to denigrate the it has been respected and we have avoided the dangers that were inherent in the threats to proceed in Defiance of one of its most important judgments that the consent of the provinces is required for changes that affect their the court has ended the need for although except in this one area of constitutional mechanisms it was never the stranglehold that prime minister Trudeau has been so fond of it did As a matter of historical prevent substantive changes in the Constitution when Public purpose demanded it is a false myth that there has been a half Century of constitutional it always seemed desirable that the Rule of unanimity should prevail one last time in the search for an Amend ing that has but not been except on the question of fiscal compensation when a province opts out of a program requiring constitutional Quebec was one of the Spon sors of the formula that has been the agreement provides a Way around unintended Adverse effects of the charter there for a danger As the charter stood in the parliamentary Resolution of striking Down All legislation resting on the concept of an age of minority Dur ing which no one has full Legal the notwithstanding clause seems to take care of that sort of the prime ministers statement indicates that the absurd proposal that have Given the Senate an also unbreakable veto Over any and All legislation of the House of commons will be that is essential be cause the proposal in the with its presumably unintended Conse was contrary to every demo cratic principle and one of the Slop Piest clauses Ever written into any constitutional if any Sena tors resist the return to common sense that Battle should be fought out right the Senate has nor Mally never wanted More than a suspensive veto which can be defended even though it is an appointed body so this matter should go All of this leaves the main question was the original purpose of it All the strengthening of Federal ism in Quebec forgotten during the Long and bitter controversy and the hectic negotiations in Ottawa last week does this reinforce the federalist Victory of May 1980 the final answer to that question will Only emerge with the passage of it is certainly not obvious now that this is achieved by the isolation of whether Premier Rene Levesques reasons for standing aside were tenuous or the political process is never the balance of political forces that existed the night of the referendum is not the one that exists the pro Cess which Trudeau launched last year is open to Many the most damning of them All is that he substituted an attempt to use political Force for political skill when lie faced a very skilful progressive fortunes Are a major unknown does a which was formed because of discontent with the existing political parties and desperation about individual have any Chance in this election it depends on the Point of a number of observers have predicted that the progressive created in Early March by a number of unhappy new will be Lucky to receive two per cent of popular that prediction includes the defeat of the three who held seats in the last legislative the established parties agree with that tories chortled with glee when the progressives were anticipating that those Candi dates would attract enough nip votes to keep the Lyon government in nip Leader Howard Pawley was less Joyful but placed the group in the same category As the Rhinoceros party and insisted it would have no Impact what he believed that any votes it would would come equally from the let them counters Progress Ive Leader Sidney i regard the observers trying to self fulfil their own they have a Short memo he after while it took the nip 30 years before it could run 39 candidates in his party has 36 candidates after Only eight months of under the dome Arlene Billinkoff some said we would not be Able to Field 15 they were dead but Are they dead wrong about the future the progressives Are in a precarious while Green has compared his group to the informal parliamentary associations which were the forbears of existing Many question whether the time is right for such a even though the liberals appear to be fading into Ollivi can the progressives fill the Gap despite greens insistence that those making up his party reflect common beliefs and the exceedingly Broad Range of views represented by the candidates May make some voters they have shown up in varying numbers at progressive gatherings throughout the at least curious enough to find out about the party that was greens As he admitted earlier in the his party could not compete with others in the advertising instead there would be a return to with a series of meetings in order to give people an Opportunity to hear and comment about progressive programs and plans for the inherent in those policies Are the goals which were cited when the party was formed sound Public Industrial Freedom of collective bargaining and it is in this Battlefield that we believe Success is the Leader has been True to his As he presents one program after they have varied from the general assertion that a progressive government would move toward greater Equality of Industrial Revenue throughout the province to the More specific scheme to Deal with High inter est that plan provides for a growth Opportunity investment program through an Agency of Treasury which would provide Dollar for Dollar financing for Manitoban who have imaginative programs with a reasonable Chance of there would be no interest payable and the Agency would be a growth when the business would have the Opportunity to buy out the Agency at the increased value of the the progressives would also return to the Flat tax on instead of the tory percentage and would Intro Duce a program of guaranteed equivalent Hydro rates for Domestic Consumers who switch from Oil and Gas to hydroelectric an excess profit tax would be instituted to ensure re source industries would pay higher taxes As their profits increase and the government would assume All costs for pos secondary some of those promises May sound but it is doubtful they will be tested unless the party which becomes government decides to use that party will not be the while certain outsiders say Ben Han Uschak is the Only candidate with any Chance of others doubt whet i doonesbury or any including the Lead will have a legislative what about Green the new democrats insist that Inkster is their Terri tory and will elect any nip Green it had been personal support and would be proven once they try to disparage my vote getting he recalled that he won a seat for metro Council twice for the but when he moved other new Democrat candidates were not the people he has met during his campaigning have been he i think i have represented them Well and the response has been As Good or better than Ive Ever re the mistake of the new democrats is to think they own the i dont think i have to win 1 have done those who have predicted his political demise Are he one must be concerned about the credibility of the they know nothing about they Are engaged in wish there Are wishes on All new democrats probably wish the progressives would fade away Many tories wish Green would return to the House because of his style and the progressives wish for Many More not every wish will be Steff m to myth inv kure i he Isa most worthy lilo w grow Aud often turn5d hassom5 thing every University looks for in a million Buksaw a ;