Rituals of Rhetoric and Nationhood: The Liberal Anti-Deficit Campaign (1994-1998)

Journal of Canadian Studies, Spring 2004 by Weinroth, Michelle

On 17 and 18 October 1994, Finance Minister Paul Martin presented two key documents before the Commons Finance Committee: A New Framework for Economic Policy (Martin 1994a) and Creating a Healthy Fiscal Climate (Martin 1994d).12The two documents describe the Liberal government's agenda for jobs and growth. That program of action constituted the beginning of a clear departure from the "jobs-first" electoral platform of 1993. In A New Framework for Economic Policy (otherwise known as the Purple Book), the Liberals rejected full employment as a possible policy goal. Adhering to the economic notion of the "natural" or "core" rate of unemployment (at that time, 8%), they argued that such a rate could not be lowered lest it precipitate inflation. Deficit reduction and stabilizing the debt were deemed to be the essential pre-requisites for growth and job creation. For some of Paul Martin's critics, A New Framework for Economic Policy, which formed the Liberals' blueprint for the next five years, was not only a shift of emphasis: it was a clear renunciation of all progressive alternative solutions to Canada's problems of unemployment and poverty (Campbell 1994, 1-2).

A New Framework for Economic Policy not only spelled out the altered agenda; it also rationalized it. The document's rhetoric served to maintain the government's legitimacy by averting the potentially adverse public reaction that would result from its modified economic proposals. While admitting that Canadians would have to adapt to new developments and display initiative rather than dependency on social programs, it underlined the promise of new "opportunities." For this reward, however, the jobless had to show an entrepreneurial spirit, acquire more skills, and disengage from the "disincentives" of social assistance. The underlying message consisted in an exhortation to the jobless to become more self-reliant and to grasp the firmness of the government's commitment to balancing the books according to schedule. Spending restraint had to be the prime target of fiscal adjustment (Martin 1994a, 86). Clearly the Purple Book promoted deficit reduction as the pre-eminent track for the Liberal course of action. Jettisoning the two-track approach of the Red Book, they embarked on their crusade, embracing the policies of their neo-conservative predecessors with unmatched fervour (Barlow and Campbell 1995, 126).

In substance, such policies could scarcely be heart-warming to the average citizen. They involved massive reduction of government expenditures and a radical downsizing of the public sector. According to Infometrica, the 1995 budget would take some "$25 billion and 45,000 jobs out of the government sector over a three-year period-a net loss of 80,000 jobs to the economy as a whole in the first year alone" (Barlow and Campbell 1995, 127). How then was the Liberals' shift in priorities-from job creation to anti-deficit action-tolerated when the government's dismal news portended severe cuts in public spending? What was the process by which a large majority of people-55% of Canadians in 1994 (Angus Reid 1994, 2-3) and more still in 1995 (Environics 2003)-came to believe that deficit-cutting, though not first on the agenda, was a necessary course of action?13 How did government leaders continue to act with confidence in spite of their lapsed promises? How would they rebuild solid consent amid increasingly sceptical Canadians?