Drop taxes now…

…but they have to come back up when times get good.

If we as a planet are going to adopt the Keynesian model of economics over the neo-liberal free market model that’s been dominating for the past few decades, then we cannot continue to drop taxes in good times.

Lynne Fernandez at the Progressive Economics Forum makes the argument nicely for the upcoming Manitoba budget, the only province that currently has a NDP government (also featuring Canada’s longest serving premier).

We recommend that the province take another, closer look at Keynes’ ideas: tax cuts should never be a permanent feature of a progressive, forward-thinking society. Eventually there will not be enough money for the important initiatives so needed in our province; initiatives that would allow us to ride out the current crisis and emerge even stronger. [emphasis added]

Too bad Canada and most provinces are at such low tax rates as a result of the past philosophy that cuts now are going to make budgets bleed anaemically. As well, with a SoCon government, it will be tough to extract the necessary targeted funding to make a difference.