The Electorate Has Spoken

"They will have the opportunity to deliver the change that Ontario so clearly needs. Nobody should mistake this result as an endorsement of the status quo. Kathleen Wynne promised very different behaviour from what we have seen for the past 11 years. She will be held accountable if she does not deliver on that change."
Tim Hudak, defeated leader of the Ontario Progressive Conservatives

"They are still going to be facing pressures from the credit agencies to get the province's fiscal finances in order. There's no way to avoid it. The reality is there and it can't be wished away."
Mazen Issa, senior Canada macro strategist, TD Securities, Toronto

"It's a huge hole to come out of and it's going to require tough measures, including looking seriously at the spending side."
"It's a bit of a Hail Mary to hope the economy will recover so much that it will take care of the problem."
Candice Malcolm, Ontario director, Canadian Taxpayers Association

THE CANADIAN PRESS/Darren Calabrese    Ontario Liberal Leader Kathleen Wynne acknowledges supporters at the Liberal's election night headquarters in Toronto Thursday.

The problem being Liberal leader Kathleen Wynne, elected with a majority government to the joy of Liberals and the consternation of fiscal conservatives, or for that matter anyone with a memory longer than that of a gnat, recalling the not-so-distant-in-time fiscal imbroglios of eHealth, Ornge, re-election-eve gas-plant cancellations, and other spuriously specious provincial investments like Green Energy that has Ontarians paying the highest energy rates in North America.

There's more, all of which Kathleen Wynne reiterates whenever the opportunity arises, which is always, that none of this was on her watch, but the handiwork of her predecessor, Premier Dalton McGuinty. Despite the inconvenience of the reality that she was a senior member of the McGuinty cabinet, and Energy Minister, signing off on the election-eve gas-plant cancellations with their billion-plus cancellation fees.

Ontario now boasts the distinction of having the highest net debt in the country, comparable to the economic mismanagement mess that the state of California finds itself in. That net debt of $267.5-billion just keeps growing, faster than the economy is chugging along. Ontario is in the position of using credit as a reflection of spending more than it collects. The province pays out $11-billion annually in interest payments alone to finance its debt; money that should be spent on public infrastructure and the critical areas of education and health.

Premier Wynne has promised to balance the budget by 2017, without making any critical cuts. Credit rating and bond agencies appear on the cusp of downgrading the province's credit rating. When that is done, we're going to be placed in a different category that will impose higher interest rate pay-back, further impairing the province's ability to proceed with matters that must be addressed. The net-debt is forecast to jump by 7.7%, while the economic growth rate is anticipated to come in at 4% if we're lucky.

Ontario has $250-billion worth of bonds, leaving other bond holders far behind, with our debt-to-revenue ratio at $237.7%, worse even than Quebec. By comparison Alberta's debt-to-revenue ratio is $31.9%. "We see deficits narrowing at a lower pace but in Ontario, they are growing from previous forecasts. That's not an ideal situation from our point of view", pointed out Michael Yake, assistant vice-president at Moody's Toronto in a classic understatment.

The Liberals ran their campaign warning voters that should Tim Hudak be elected jobs will be lost and the province's future would spiral downward. His pledge to restore the province to fiscal solvency was one that would cause just too much pain to ordinary taxpayers, she warned; hospital wait times would increase, children's education would suffer, civil servants would be culled out of the workforce and everyone would pay the cost for all of that.

Public service unions went on a very expensive free-for-all campaign against the PCs, portraying their agenda in the worst possible light, closing in on fairly dirty campaigning. The Liberals and their union allies treated the voting public to scare tactics that came fairly close to doom-claiming. And the electorate handily 'forgot' all the scandals that plagued the Liberal-led government, with job losses, and silk-glove treatment for First Nations violence during the Caledonia land dispute, as well as the billion-dollar losses on a quartet of failed initiatives.

Native protesters stand at a housing development near Caledonia, Ont., despite a court order asking them to leave, on March 22, 2006.   (Sheryl Nadler/The Canadian Press)

And this is the same government that gave sweetheart contracts to Ontario teachers, police and other civil servants who among them earn the highest salaries of their provincial counterparts elsewhere, and whose contracts are now coming up for bargaining. With the fiscal cupboard empty, and Premier Wynne indebted to the unions for their invaluable aid in combatting the potential for a PC government, what blandishments will prove successful in persuading unions to give hefty raises a pass this time around?