Coalition would not be bad for the economy

The Toronto Star:

Contrary to federal election campaign rhetoric, neither a minority nor coalition government would necessarily be a detriment to the Canadian economy, economists and political science experts say.

In fact, many argue that deficit reduction will have more lasting impact on the economy that than corporate tax cuts and other short-term spending decisions.

“The political rhetoric is a lot more dramatic than the economic reality,” said Henry Jacek, political science professor at McMaster University in Hamilton, Ont.

“It is possible that any government could make a mistake and do something over the intermediate and longer term that is a serious problem for the country. But not over the short term,” Jacek said.

“All parties when they come to power work within the constraints of what are traditional economic policy in Canada. It would be hard for any party to really alter the basic economic fundamentals of our country in the short-term.”

For instance, Canada’s banking and insurance system, more conservative than those of the U.S. and Britain, held firm during the credit crisis and financial meltdown in 2008, Jacek said.

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