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Comment: Ottawa must step up in virus fight

A commentary by a former longtime deputy minister in several ministries. The handling of the COVID-19 crisis in B.C. has been brilliant. Adrian Dix, the minister of health, deserves full credit.
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Provincial health officer Dr. Bonnie Henry and B.C. Health Minister Adrian Dix have been doing a good job managing the pandemic, Bob Plecas writes. Now it's the federal government's turn.

A commentary by a former longtime deputy minister in several ministries.

The handling of the COVID-19 crisis in B.C. has been brilliant. Adrian Dix, the minister of health, deserves full credit.

He took the advice of our provincial health officer, Dr. Bonnie Henry. And in that capacity she has performed to the highest standards of a public servant.

The prime minister has been controlled, well scripted, cautious, yet decisive when needed. We will forgive him for attempting tax and spending authority for 21 months, as he wisely backed down.

But I must say it is beginning to sound like an election campaign. Every day there is an announcement. Some part of society needs government funds. Interest groups have complained: “What about us?” and a day or two later there is a government program.

Now either they have no overall plan — check that box! Or they govern best when they have our PM before the cameras explaining today’s new program — check that box!

Today is not normal. All taxpayers need money from their government now — extraordinary emergency funding to support average Canadians and small mom and pop businesses, bigger ones, including publicly traded ones.

The federal government has announced about $100 billion in new spending. It might even ratchet up to $150 billion.

Simply put, that is not enough.

The last time we faced such an emergency was the market meltdown in 2008. Two lessons stand out from our experience with government intervention in the markets.

One, the response was too slow and timid. Overreact early and generously to provide assistance, the lesson.

Two, do not pick and choose client groups with incremental targeted programs or marginal returns on some future date. If your goal is relief and saving jobs and business in the months ahead, spend broadly and generously.

We are in a forced recession. Our choice is how long do we let it last. Do we stay in recession for a short or long time?

Other countries, notably the United Kingdom and the United States, are spending to ensure a short recession. We are not.

Do not be confused. I think both the U.K. and U.S. have not handled the health crisis appropriately. Our model on the combatting the virus has been better.

But on the people and business side, their quick recovery model, a broadly based emergency and recovery plan, is better public policy.

We have about 38 million people in Canada.

The U.K. has double our population, and their plan is to spend more than 500 billion GBP, or $875 billion Cdn.

The U.S. has a population about 10 times our size. The U.S. plans to spend $2.28 trillion dollars. It includes cash payments to every American of $1,200 US, or $1,700 Cdn.

Both provide for a broad-based, universal, generous security net for the present, and to ensure a quick recovery from the current recession.

Putting cash in Canadians’ pockets, and keeping businesses alive and their employees able to survive and return to work, is key to long-term survival. Our approach seems like we had either Treasury Board number crunchers or election strategists making policy rather than common-sense elected officials.

Useful to remember the government has no money itself. Government has our money, and can only borrow on our behalf.

There are processes that provide checks and balances for oversight of expenditures, and elections to hold elected members accountable.

Borrow more, our progressive tax system will tax back redundant payments, and tax strategically, because Canadians need a healthy dose of financial stress reduction. And they need it in pocket now.

Finally, the federal government needs to take the gloves off with the banks. The central bank lowers interest rates. It is not passed on. Credit cards will only delay credit card payments but still charge 20 per cent interest. The fact is, Canadians already have too much debt and they do not need this crisis to add more.

The big six banks in Canada made combined profits of $46.6 billion last year. Their contribution would be zero interest charged on credit cards and on mortgages payments, and for the duration. If jawboning does not work, tax them a temporary social dividend tax.

At the end of this, taxpayers will pay the piper. That is our job. The government’s job is to get us through, and what is on offer now is adding to our angst. Spending self-isolation time on hold to ask questions or filling out applications does not help.

Because it will take all parts of society together with a good plan to defeat this enemy.