Don't panic, says Harper; Do something, say opponents
Published Friday October 3rd, 2008
OTTAWA - Stephen Harper's rosy view about the economy came under fierce attack Friday as opposition leaders hammered the prime minister for stubborn inaction in the face of an economic crisis.
Taking up the theme from the televised campaign debates, Liberal Leader Stephane Dion accused the Conservatives of having no plan to rescue the Canadian economy and hoping voters won't notice the crisis until after election day Oct. 14.
"In the context of an economic crisis, not to act costs too much - to do nothing is not an option," Dion told a Chamber of Commerce audience in Montreal.
NDP Leader Jack Layton, who was also campaigning in Montreal, doubled up on the charge.
"Well guess what, things aren't fine," he said. "It seems to me that last night (in the leaders' debate), Mr. Harper really showed he doesn't understand the impact of losing one's job."
Layton took credit for forcing Harper to admit the Conservatives had cut $50 billion in corporate taxes, money the NDP leader says he would spend on creating jobs.
The prime minister launched his own offensive, repeating a charge that Dion's surprise announcement of a 30-day economic rescue plan is unnecessary and little more than a sign of panic.
"If we don't panic, we stick on course, we keep taking additional actions making sure everything we do is affordable, we will emerge from this as strong as ever," Harper said in Saint John, N.B.
"We are not going to get into a situation like we have in the United States where we are panicking and enunciating a different plan every single day."
Harper again asked voters to give him a strong mandate, arguing that another minority Parliament would be disastrous for the Canadian economy and pointing to the difficulty the U.S. Congress has had addressing the financial meltdown.
The sharply contrasting views about the peril to the Canadian economy from the trauma in the U.S. - and what action, if any, is needed from Ottawa - appears to have established the rules of engagement for the final 11-day race to the finish line.
But whether it will change the script for the campaign is open to question since each side can find credible evidence for its position.
Comparing Canada to the U.S., the prime minister noted that the federal government remains in surplus, employment is up so far this year, inflation is low and Canada's banking system looks like a rock in comparison to the quicksand swallowing up storied institutions on Wall Street.
But the opposition parties are making much of the fact the Canadian economy actually shrank and lost jobs over the last six months, and economists are anticipating another negative employment report next Friday.
As well, most analysts were predicting the Canadian economy would be flat for the rest of the year before last week's financial tsunami on Wall Street. Now they say the situation has worsened and Canada could soon follow the U.S. into recession, with possible deep job losses in Ontario and Quebec.
There was good news and bad news for the economy Friday.
The U.S. House of Representatives reversed its previous rejection by passing a controversial $700-billion financial bailout that analyst believe will set a floor for a recession, but not avert one.
Washington also reported, however, that the U.S. had shed another 159,000 net jobs last month, bringing the total loss for the year to 760,000.
"The (U.S. rescue) plan cannot prevent a U.S. recession because we're already in one," said CIBC senior economist Avery Shenfeld.
"Canada already saw a decline in real output in the first half of the year, and while the third quarter got a great start on rising energy output, the economic headwinds point to another decline in quarter four (October-December)."
Moreover, the Bank of Canada conceded that the global credit crunch is starting to seriously affect Canada's financial system, announcing it needs to inject another $12 billion in cash to ensure Canada's chartered banks have enough capital to make loans.
Amid the roller-coaster of economic developments, the opposition accused Harper of failing the leadership test for not having a plan to deal with the problems. The Conservatives had yet to release their election platform even as advance polls opened Friday, although they have announced a series of targeted and modest economic measures.
Harper said the party's official platform will be unveiled Tuesday.
It's unclear what the emergence of the economy as the central ballot question will mean for what remains of the campaign.
In most polls, Tory support has been steady. The newest four-day rolling Canadian Press Harris-Decima poll showed the Conservatives in solid minority-government territory with a 15-point lead over the Liberals.
But another survey also released Friday suggested that gap had substantially narrowed to five points, a margin that would be the closest since the campaign began.
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