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Mar 18

“I know an old lady who swallowed a fly,” my seven-year old trilled happily this morning, echoing millions of young children of yesteryear. “I guess she’ll die.”

The old lady, realizing her folly in swallowing the fly, strove mightily to rectify her error.  She swallowed a spider to catch the fly, followed by an increasingly absurd procession of creatures, each devoured to capture the one preceding it.

She swallowed a horse in the end - and died, of course.

It’s a fantastical tale of cumulative woe: a foolish initial decision fatally compounded by a series of additional blunders, each more ill-advised than the last, the outcome lethal but predictable.

And it serves as apt metaphor for the alarming performance of B.C. Premier John Horgan and his government.  Consider for example the “speculation tax” rolled out by Minister of “Finance” Carol James. (I would deliberate instead in this space on the odious business of illegal job-killing pipeline obstruction, but an angry red haze obliterates my vision each time I consider that monstrosity of poor governance, and I’m left muttering incoherently and unable to join sentences properly end-to-end.)

The new tax targets not just foreign owners but also out-of-province owners of B.C. property in select jurisdictions. That many of these Canadians, Albertans chief among them, simply hold vacation properties in B.C. (some have been in families for generations) matters not one whit:  with a stroke of Ms. James’ pen they are now labeled as “speculators” in the real estate market and subject to punishment by tax.

The outcry was immediate and predictable – and over-the-top, according to UBC real estate “economist” Tom Davidoff, one of the bright “intellectuals” who influenced the NDP to introduce the levy.  “Alberta oil executives who own B.C. vacation properties will be able to afford the new tax,” he scoffed. That’s right – those thousands of extra dollars in annual taxes represent but a jingle of loose change for filthy rich Albertan tycoons who own B.C. vacation homes as casually as Bill Morneau maintains a villa in France.

Full disclosure: my family purchased a small vacation property in B.C. (the province in which I was born and raised) eleven years ago, in an area not (yet) impacted by the new tax.  The only “speculation” that took place on our part pertained to anticipation of years of wonderful family vacations to be enjoyed and troves of precious memories to be formed.

Oddly, the sloppy “oil-patch-executive” picture painted by the ivory tower’s Mr. Davidoff describes neither us nor any of the fellow cottage folk we’ve had the pleasure of befriending over the past decade - among them a plumber, a firefighter, a lawyer, a Telus employee, a doctor, an airport manager, a chiropractor, a home inspector, a paramedic, two accountants, several contractors, and multiple retirees.

Ignored by the NDP brain trust is the hefty economic activity generated in B.C. by these families - the property taxes they pay, the caretakers and builders and marinas they support, the golf courses, restaurants and businesses they frequent, the wineries, orchards and attractions they visit – in short, the cold, hard cash that they bring.  “B.C”. has long been a euphemism amongst the out-of-province crowd for “bring cash” – it’s not the lowest-cost jurisdiction in the world, suffice it to say – and bring cash they do, by the truckload.

It’s worth noting at this point that the B.C. educational curriculum has recently and commendably been supplemented by robust instruction in financial literacy.  Beginning in kindergarten, children move quickly beyond identifying beavers on nickels and counting loonies to understanding key financial concepts, from budgets to mortgages to investments.

And it’s a fair bet that any freshly minted graduate of first grade in B.C. would accurately count the speculation tax as a loony economic move.  It should be required of the current NDP executive, perhaps, to enroll themselves in the new curriculum at the kindergarten level, so as to acquire the basics of economic theory as aid to trying to run the province:  1+1=2, and all that.

Forced to react by a storm of protest and ridicule (including from British Columbians with second homes who discovered to their dismay that they too would be dinged by the tax grab) Carole James “tweaked” her proposal.  And like the old lady chasing the fly, her “solutions” have made a crappy initiative worse.  The quagmire of new rules and exemptions and tiers of taxation are destined to keep armies of lawyers and accountants and tax advisors steadily employed in interpreting, dodging, and gaming the complexities.

Ms. James continues to breezily project that the speculation tax will pull in $200 million, just as originally estimated – a number plucked from thin air that ignores the changes she’s made to her initial proposal and that dismisses the behavioral responses certain to be implemented by those who are impacted.  She doesn’t understand, inexplicably, that many Albertans and other Canadians will choose or be forced to sell their properties (into a market comprised only of B.C. buyers); that lower property values generate lower property taxes; and that steeply declining cash inflows from out-of-province visitors will have ruinous economic ripple effects.  While her rudimentary "calculations" might generate a $200 million number on her socialist abacus today, the actual yield will add up to a mere fraction of that, once the dust settles.

As additional “improvement” Ms. James carved out the Gulf Islands from the tranche of affected jurisdictions, leaving Kelowna and West Kelowna in the penalty box despite vociferous lobbying by the unanimously opposed mayors and councils of those cities, and left open the possibility of the tax expanding to other areas in the future.

It’s government by whack-a-mole in the process of whacking a hole in the provincial economy.  Who in their right mind would purchase a vacation property in Penticton, or Osooyos, or Invermere, while these clowns are in charge, knowing that new and punitive taxes could lurk just around the next corner?  No-one, that’s who.

Mr. Horgan and Ms. James will live to regret ingesting the speculative fly, but not, alas, before serious harm is done to hard-working British Columbians.

And I’m surely not the only one to note that while the newly-excluded Gulf Islands are represented by Green Party MLA Adam Olsen, Kelowna and West Kelowna are saddled with five Liberal members.  Partisan politics, in all its glory.  Stubby tails wag the hardest, and the stump of three elected Green Party MLAs violently wagging the NDP dog, particularly on pipeline "policy", threatens to shake our Confederation apart.

It can’t go on forever, but it’s not going to end tomorrow: those imagining a short-lived minority NDP administration are deluded, sadly.  The Greens, intoxicated with influence beyond their wildest dreams, would sooner sell their souls to the devil than pull the pin on this government.

It’s no accident, it seems to me, that the NDP party has laboured in opposition for all but fifteen of the years it has been in existence (dating back to its inception in 1933 as the Cooperative Commonwealth Federation).  When a government of this ideological stripe manages, once in a great while, to get its hands on the levers of power, it reacts like a hormonally frustrated bull let loose in a china shop, trampling destructively all over prevailing economic order in a mad rush to implement its agenda.

Eventually voters react with alarm, evict the socialist beast, and then spend long years regretfully and painfully cleaning up the shards.

And in the end, rampage complete, this Horgan government will die too.

I’m just speculating, of course.

 

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