Shine on, you crazy Dymond

Enough column inches are given to blatant pro-corporate shilling that it's tough for any particular piece to stand out as more obviously deserving of criticism than any other. But W.A. Dymond manages the feat with a remarkable combination of non sequiturs and outright contradictions - so let's give it the full treatment it deserves.

Of course, Dymond starts off with the usual garden-variety corporate cheerleading:

Any tax change produces a lightning-rod effect. The decision by the Ontario government to harmonize the provincial sales tax with the GST has generated strong lightning strikes, both positive and negative. In my view, the positives outweigh the negatives by a wide margin for several reasons.

First, the harmonized tax is part of a major tax package which tax specialist Jack Mintz calls “the sharpest reduction in the tax burden on capital investment in any one province” he has ever seen. It should have, Mintz argues, a profound effect on business investment in Ontario through the virtual elimination of tax on capital goods and business intermediate goods. It will result in a dramatic improvement in the international competitiveness of the province. Mintz predicts that within ten years, the lower tax burden will increase capital investment by $47-billion, annual incomes by between 4% and 8%, and jobs by almost 600,000.

Second, the tax shifts the burden of taxation from income to consumption. It removes a major distortion in the current system by taxing only the value added at each stage of production rather than at each point of sale. This will be a major benefit to service providers such as electricians, plumbers and computer specialists who now have to pay the provincial sales tax on the tools and supplies they need to do the job. The harmonized tax will allow them to claim tax credits on these goods and pay tax only on the value added. Further the harmonization eliminates the need for business to comply with two separate and different sales taxes, which will be a major cost savings especially for small business.

Blah blah blah, what's good for your corporate overlords is good for everybody. Nothing much to comment on here that hasn't already been thoroughly debunked before. But then it gets a bit more creative.

Third, the harmonization will make a major contribution to removing barriers to the internal Canadian market. While Canada and Ontario have long benefited from the global reduction of trade barriers, internal barriers such as conflicting provincial regulatory regimes on transportation, health, safety etc. have long weakened Canada’s international competitiveness by making our small market even smaller. Ontario is as guilty as any province in creating such obstacles. However, by adopting the harmonized tax the province will join British Columbia, Quebec, Nova Scotia, New Brunswick and Newfoundland/Labrador in removing a major obstacle from an integrated domestic market.

Now, this is a remarkable bit of spin from Dymond. Whatever one's view of the HST, it has nothing at all to do with "trade barriers" in any meaningful sense of the term, particularly as compared to "regulatory regimes on transportation, health, safety etc.". While these factors might carry at least the theoretical potential to affect how business is done in different jurisdictions (albeit with zero current examples of how any of them actually do justify the government-flattening agreements normally proposed in response), it defies belief to suggest that having to pay sales tax in some provinces somehow creates some disproportionate difficulty in conducting business across provincial borders.

As a result, it seems most likely that Dymond is simply taking any opportunity available to him to get the pro-TILMA line in print even where it makes absolutely no sense in context. And one can't help but to salute his brazenness on that front.

Of course, there is another alternative: it could be that in order to pretend that trade barriers exist, corporate Canada has reached the point of having to argue that the very existence of separate provincial policies - even in areas other than what's normally identified as business regulation - runs contrary to their idea of an "integrated domestic market". But normally that seems to be treated as the unspoken endgame rather than an explicit goal, precisely because neither the provinces nor their citizens figure to take too kindly to being informed that any attempt to government themselves is inconvenient for business.

Onward:

Fourth, as Kevin Lynch, former secretary of the federal cabinet points out, Canada has a major productivity problem. Among the advanced industrialized countries, Canada ranks only 17th in productivity performance. In 2007, business productivity was 75% of that in the U.S. compared to 90% in the 1990s. A poor productivity performance is a drag on growth. Getting the tax framework right by encouraging investment in new technology and machinery is part of the answer.

Check "productivity" off your Buzzword Bingo card, and we'll return to this later.

It is no surprise that the harmonized tax is controversial. It will apply to services and a broader range of goods than the provincial sales tax. However, transition payments by Ontario with significant federal financial support will for a time offset the additional cost faced by consumers. Ontario will also introduce a permanent sales credit for lower income families.

So as long as we throw a few pennies at the poor, nobody should have any reason to worry about our handing billions to big business based on nothing more than their view that they'd like more money. Natch.

It is no surprise that the harmonized tax is controversial. It will apply to services and a broader range of goods than the provincial sales tax. However, transition payments by Ontario with significant federal financial support will for a time offset the additional cost faced by consumers. Ontario will also introduce a permanent sales credit for lower income families.

Keep in mind, this comes a mere two paragraphs after Dymond lamented the fact that Canada's productivity has done nothing but lag since the time when his ilk claimed that NAFTA and the Martin round of corporate tax cuts would FIX OUR ECONOMY FOREVER!!!

For anybody looking at the consequences of policy choices, that would seem to point to the glaringly obvious: that decades of free-trade agreements and corporate tax slashing haven't done squat to improve Canadian productivity. But for the likes of Dymond, the fact that the previous round of business-centred policies didn't perform as advertised merely suggests that we need to double down. And if that fails, then maybe a negative corporate income tax will be enough to finally do the job.

The recession delivered a heavy blow to the Ontario economy. Massive job losses in manufacturing, a ballooning budget deficit, and becoming a have-not province have thrown into sharp relief how outdated the province’s business model has become. The easy days when Ontario rode the top or close to the top of the charts as the most prosperous province in Canada are gone. In the sea of gloom that has enveloped what was once the richest province of Canada, reasonable people should support the harmonized tax as part of a larger package of tax reform which, taken together, will create the conditions for the resumption of strong and sustained growth in Ontario.

Translation: I didn't expect to enjoy "The Shock Doctrine", but found that it contained some excellent ideas which I've been able to put to use.

In sum, it's nice to get at least a slight break from the same old already-debunked rhetoric in favour of something which at least rearranges the arguments with no regard for consistency or logic. And I'm almost looking forward to seeing where Dymond goes from here with his apparent tactic of putting boilerplate corporation-first blather in a blender and serving what comes out to the media.