Opinion: A BC Liberal government on May 9th is in the national and provincial interest

In my latest interview with Jim Goddard of Talk Digital Network, I highlight the high stakes at play in Tuesday's BC election. From resources to housing, the prosperity of the province, and to a lesser extent Canada, will be shaped by the outcome of the May 9th vote.

Governments always make mistakes and the BC Liberals have been no exception. They were slow to move on regulatory reform in the real estate industry and clamp down on excesses. In response to rising home prices in the lower mainland, they brought in a foreign buyer property transfer tax. However, the role that the tax has played in at least temporarily cooling down the housing market remains unclear at this point. A bigger worry is their introduction of zero-interest loans for first time home buyers. This is probably the single worst policy decision made by the current BC Liberal government. If the government is determined to take tax dollars and hand them over to first time home buyers, they should replace zero-interest loans with a policy that is less likely to feed a speculative feeding frenzy in the Vancouver condominium market.

Yet when it comes to housing affordability, critics are putting too much blame on Victoria and not enough on Ottawa. The central government has been setting the stage for the current mess for more than a decade. The key drivers of unaffordable housing in BC are a combination of huge taxpayer-backed mortgage guarantees, poorly conceived and administered immigration schemes, lax tax and money laundering enforcement and the appointment of a central bank governor who believes housing hyper inflation is someone else's problem. If Ottawa does not take further policy action, expect more provinces to stumble as they respond to housing inflation.

In terms of the overall economy, the track record of the Christy Clark government is impressive. When Ms. Clark re-entered BC politics to run for the BC Liberal party leadership, she put job creation as her top priority. On that front, she has delivered. BC led Canada in job creation in both 2015 and 2016, and is leading the pack again this year. Critics will claim that real estate driven job growth is unsustainable, putting BC at risk in the future. But there is more going on. In education, according to an OECD study released last year, the province has one of the top outcomes for high school students in the world. This is a remarkable achievement and goes to show that in education, outcomes matter more than how much money a government spends. A globally competitive education system has put in place a strong foundation for sustained secular BC job growth in a world that will increasingly reward economies that have a skilled and knowledgeable work force.

While BC enjoys a relatively diverse economy, the resource pillar is at risk should the BC Liberals not be returned to office. The NDP have promised to investigate fracking which will put a chill under further capital investment in the northeast of the province. Mining would clearly be faced with additional layers of rules and regulatory assessment. And of course, there is their pledge to stop the Kinder Morgan Trans Mountain pipeline expansion, a key pillar in the national climate change strategy. The expanded pipeline is also essential to expanding distribution channels for Canada's oil and gas sector to make us less dependent on the United States. Stopping the Trans Mountain pipeline expansion would have significant negative consequences for the Canadian and BC economies while throwing the national climate change strategy into disarray.

Trans Mountain expansion is key to Canada's prosperity and climate change strategy

No government is immune from policy mistakes. With an NDP government, policy errors would begin streaming on day one. For starters, the party is committed to raising the corporate tax rate to eliminate the tax advantage that BC firms have over the other western provinces. It seems the NDP is not that interested in winning, whether it be economically or at the polls. As Green Party leader Andrew Weaver has said, the NDP have had 16 years to inspire British Columbians and they have failed to do so. Indeed, for those who feel they cannot vote for the BC Liberals, the Green Party offers a compelling choice compared to NDP. The Greens under Weaver have embraced evidence-based policy making, a refreshing change from the NDP's ideological approach. While there is plenty in the Green platform that would be unfriendly to the resource sector, having their concerns raised in the legislature from an evidence-based perspective could well improve the quality of policy discourse in BC politics.

On balance, the BC Liberal party remains the best choice for prosperity in the province. At the end of the day, success depends on leadership. Among the party leaders, Christy Clark stands out. In the tricky area of federal-provincial relations, she has governed by finding common ground between the provincial and national interest. That has paid off with some major policy victories including a big win in the national climate change strategy that allows BC's carbon tax levels to remain at $30 a tonne until at least the next decade. In contrast, by refusing the back the Trans Mountain pipeline expansion, the opposition parties would change the federal-provincial relationship game from co-operation to confrontation and uncertainty.

Confrontation and uncertainty is not the way to build a better future. Now let's hope both the Prime Minister and the BC Premier post-May 9th remember that when dealing with the Americans over softwood lumber.

Listen to the May 4th interview with Jim Goddard here: https://youtu.be/LErjYv7nZoo

Ted Dixon is the co-founder and CEO of INK Research which runs the CanadianInsider.com website. He is a former Policy Chairman of the BC Liberal Party but is no longer active in politics and holds no party memberships.

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