Re: ‘Balancing act in selling budget,’ Truro Daily News editorial, March 8
To the editor,
Your editorial was pretty well on the mark and touched on several important points. The final paragraph showed an appreciation for how government operates. Being disinclined to raise taxes, they prefer to attack the less fortunate through cuts to programs.
Pensions are among government’s highest expenses. Pensions are indexed to inflation, meaning they increase as costs go up. Many years ago governments made changes to the way inflation is calculated. They removed food and fuel from the calculations and began using what they term a ‘core inflation rate’, basing that on a basket of other commodities.
For a decade oil prices have been steadily climbing. This trend is expected to continue. Food production and transportation is heavily dependent on oil. Insanely, we have even diverted large quantities of food grains to make fuel in an effort to control costs. This has had the effect of further driving up food prices.
Because food and fuel prices are not factored into inflation, these necessities now consume a greater portion of our pensions.
Since food and fuel prices must continue to increase well beyond ‘core’ inflation, we will continue to lose ground. Changing the way inflation is calculated was just another attack on those least able to absorb extra costs.
Tax cuts are a popular measure with the electorate but they are badly skewed to favour the wealthy. Tax cuts may give next to nothing to low income earners while cuts to services (or increased user fees) impact these same people the hardest.
There is little doubt that governments will be forced to reduce spending. We should be watchful that they dispense the burdens on an equitable basis.
Orland Kennedy
Brookfield
