OTTAWA – Fear of the fallout from a substantial economic storm may be propelling Canadians into embracing deep federal deficits.
The latest Canadian Press Harris-Decima survey conducted last week has found a robust majority of 58 per cent of the government’s plan to record about $60 billion in deficits in the next two budgets.
That is a 10-point increase over the number who said they were in favour of running deficits to stimulate the economy a week early in mid-January. A previous survey conducted in December found even less support for deficits.
Every federalist political party in Ottawa including the New Democrats have adopted the orthodoxy of balanced budgets over the past several years. Any political party hoping to win power at the federal level promising anything but surpluses would have been barred from office.
Prime Minister Stephen Harper promised a small surplus right up until he delivered his economic update on Nov. 27. He has been telling voters since his government nearly fell that deficits are now a necessity.
Canadians appear to be going through a similar conversion.
“They are changing their minds because they are starting to be more fearful about the economy,” said Harris-Decima vice president Jeff Walker.
Support for deficit spending was building in Ontario and Quebec – areas of economic weakness – as early as December, he said. Now most parts of the country is beginning to see the wisdom of spending our way out of recession.
Another factor may be driving Canadians towards support for the demise of surpluses: their belief in the ability of government to get things done.
“We have seen a consistent pattern over the last five or six years or longer where people have basically said, ‘I don’t think government has that much impact on the economy.’ The only thing I can really ascribe this to is hope that it will actually help. It boils down to hope.”
The survey, which was conducted between last Thursday and Sunday, found that 77 per cent believe the spending will be effective within two years, with 43 per cent saying it will show results immediately or within one year.
Support for deficit spending appears spread throughout the country and across party lines, with the NDP most in favour. Conservative voters were more in favour of deficit funding (62 per cent) than Liberals (56 per cent).
In a surprising result, 62 per cent of respondents said they favoured broad tax cuts although as many – 63 per cent – agreed with the Liberals and NDP that they would be ineffective in stimulating the economy.
Conservative supporters were the most likely to accept that tax cuts would be effective and would not lead to permanent deficits.
The survey found that if broad tax cuts are included, only 32 per cent would want the opposition parties to vote down the budget, while a majority of 56 per cent said they opposed defeating the government on the issue.
The poll was part of a telephone omnibus survey of about 1,000 people and is said to be accurate to within 3.1 percentage points, 19 times in 20.
