Thursday, November 22, 2007

A Letter Exchange

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The following 3 letters appeared in the Telegraph Journal. They highlight an important and fundamental difference in opinion regarding taxes. I see the taxes I pay as money the government can invest in Canada and Canadians. Others see taxes as just spending. What's your opinion?

Tax cuts will cause programs to suffer (TJ, 2 Nov.)

I teach economics at UNBSJ. In my courses, I use a smattering of Latin, including the phrase ceteris paribus - all other things being equal. Mr. Harper's tax-break treat is good for Canadians, ceteris paribus.

My problem is that all other things are not equal - the trick follows the treat. When Mr. Harper's government could still be called "new" they made significant tax cuts.

Months later we saw the "benefits" accruing from tax cuts: under-funded day care, dangerous overpasses, decreased funding for literacy (especially important in New Brunswick if we care about self-sufficiency), decreased funding for women's groups, decreased funding for environmental groups, a student summer work program in virtual collapse, nothing but political spin on issues of climate change, and a new equalization package that will cost New Brunswickers $1.1 billion, according to the Atlantic Provinces Economic Council.

I am in complete agreement with letter-writer David Beaudin (Telegraph-Journal, Nov. 1). We don't necessarily need tax cuts. What we need is a government that takes our taxes, treats them as an investment in our country, and then makes wise investment decisions that benefit all Canadians.

Clifton Royal

Tax cuts are the way to go (TJ, 6 Nov.)

I cannot allow Rob Moir's letter of Nov. 2 to go unchallenged.

He advocates against tax cuts on the idea that - (and I paraphrase) - 'government should take our taxes and make wise decisions that benefit all Canadians.' That is just another way of pushing the old socialist propaganda that government knows best how to spend taxpayers' hard earned money.

The fact is, whatever the government, the more money they have, the more they waste. If my money is to be wasted then I would like to do it myself.

Of course tax cuts are the way to go. Surpluses just mean that taxes are too high.

Thank goodness, after decades of tax and spend, we at last have a government that is prepared to return the money where it belongs, back to the taxpayer, with large amounts being used to reduce the debt that previous governments burdened us with.

As for the 'cuts' he mentions: in many cases more money is actually being spent on many of the causes, it is just not being spent on unnecessary offices and activists but on the real people in need. How overpasses suddenly became dangerous because of a tax cut I cannot imagine. Climate change? Well, the previous government signed Kyoto and then did absolutely nothing to follow through. Is that a better solution?

Saint John

Be wary of what follows tax cuts (15 Nov.)

I feel I should respond to Mr. Stone's letter (Nov. 6) as I believe he misread the intent of my piece.

I am not against tax cuts per se, and he may note that I actually suggest tax cuts in a Commentary article (Oct. 26). Nevertheless, we should be wary of what typically follows tax cuts.

Tax cuts combined with decreased investment in programs and infrastructure also lead to large surpluses.

Large surpluses on their own are not necessarily indicative of over taxation - they may represent under investment.

I do not rely on my own opinion as a source for this policy advice. The "Father of Capitalism," Adam Smith, recognized the need for a "sovereign" or government to co-ordinate investment in public projects for which the returns to an individual are too small, but the returns to society are large enough to warrant investment. Our transportation network is one such investment; investment in literacy, which promotes future business location in New Brunswick, is another.

My point isn't that we need to increase, decrease, or even maintain taxes, but rather we should be careful what such tax cuts lead to.

Ultimately we should demand that our government wisely invest our taxes to the betterment of our country. If the government cannot find wise investment opportunities, then it should rightfully return the money to Canadians.

Clifton Royal

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