The Globe and Mail is reporting that Mr.Layton has taken corporate income tax increases off the table in exchange for Harper”s embrace of four public policies:
– Removing the federal sales tax from home heating bills and restoring the EcoEnergy Retrofit program;
– Increasing the Guaranteed Income Supplement for low-income seniors;
– Expanding the Canada Pension Plan;
– Hiring more family doctors.
Here is my take. The third is essentially demanding that Mr. Harper pledge to raise corporate income taxes through the back door (although he–Harper–could place the cost of the expanded program fully on the backs of employees). The third demand is thus a poison pill. From the small town halls of the Chambers of Commerce to the big conference rooms on Bay Street there is no appetite for an expanded CPP. This makes the third demand key because it would be a major move for the Conservative party to embrace an expanded CPP, and it would represent an increase in corporate taxes-sort of.
The other three are interesting if not laudable policies but they are as likely to help the Conservative gain votes as loose them. On the one hand, everybody hates the GST, can’t help but want to help the poor pensioners and everybody wants more doctors. On the other hand, for those rabid conservative supporters who just hate state spending Harper can say with reason “the NDP made me do it.” That is to say, if the conservatives embrace three of the four proposals they may actually gain votes not loose them.
Here then is the nightmare scenario. Harper agrees to all the demands except the expansion of CPP and Layton rolls declaring 3 of 4 a victory: then the goose is cooked and it is time for Mr. Layton to move on because it will be clear he did not know Jack.