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January 27, 2022

A question of confidence

By Deirdre McMurdy, Sympatico / MSN Finance

There's no question that the Federal Budget was designed with a very close eye to building confidence among two critical constituencies: individual consumers and small businesses. Both generate a significant amount of economic activity and their rattled confidence carries a steep price.


The Tories made a bold attempt to appear "in charge," to create the sense that their tsunami of spending will skate the country's teetering economy back on side. Things like enhanced Employment Insurance benefits, we were assured in the budget, are just temporary measures. Considerations to get us all over this hump.

The problem, however, is that the very prospect of a $64 billion budget -- and it long-term implications -- are precisely the sort of reality that undermine stability and, hence,  consumer and business confidence.

 

Furthermore, "temporary" measures have a strange way of morphing into permanent, structural ones. The political reality -- and this budget is nothing if not political -- is that it's far easier to give than it is to take away. 

 

That's one reality in which we can have  true confidence.






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