I see that Michael Ignatieff is double-talking tough on the new Tory budget, telling his first caucus meeting as leader

"This budget has three simple tests that it must pass. Will it protect the most vulnerable? Will it save jobs? And most important of all, will it create the jobs of tomorrow?"

The Ottawa Citizen added that "While Mr. Ignatieff did not directly threaten to defeat the government over the budget, Toronto MP John McCallum, the party’s economic policy critic, told reporters that Mr. Ignatieff has frequently said a Liberal vote against the Jan. 27th budget ‘is still very much a possibility.’”

Such appalling verbiage manages at once to be substanceless spin (what sort of infinitely flexible ruler is "protect the most vulnerable"? Especially when you're dug in on the hill of "very much a possibility") and to contain a grievous error: Does anyone now seriously think governments, rather than entrepreneurs, "create the jobs of tomorrow"?

Barack Obama's "stimulus" plan now includes, "advisers said", $300 billion in tax cuts because he seemed too focused on making government bigger to help the economy. Which means it's not really a "plan" because sudden kluges on this scale would undermine its structural integrity if it had any. But as long as politicians keep hurling hundreds of billions of dollars about in a weirdly self-satisfied panic, market participants are unlikely to recover their confidence. Would you?

Now that the car industry has its (first) financial crisis bailout package, guess what? Big Steel has joined the queue, asking for a huge infrastructure program with massive "buy America" provisions that might risk trade wars that worsen the global crisis and raise costs for everybody else but on the plus side would send money right to them. As everyone gets bailouts, though, some question must arise as to who's going to pay. Will homeowners fund autos, autos fund steel and steel fund homeowners? It's like that Battle of the Bulge joke about the Sarge saying "Men, I have good news and bad. The good news is after a week in foxholes you all get a change of socks. The bad news is, Harry you change with George, Sam you change with Fred..."

So it turns out the experts didn't actually know what the economy was going to do after all. No really. Thomas Homer-Dixon said it so it must be true. Gosh. I guess we'll all be driven back to hoping for the best and preparing for the worst by keeping ourselves flexible, spending less than we earn and trying to diversify our savings in case life has unexpected ups and downs. Weird.

As you sit amid the wrapping paper and debris on Boxing Day, picking your teeth with a wishbone, I want to ask: What if that was it? Would it be enough?

I don't mean what if you were struck down tomorrow, or if you never saw another Christmas pudding consumed by flames. I mean what if, from now on, there were as many gifts equally good (or tacky) and the same Christmas dinner, in houses as nice and warm as this year and so on, but not more. Would Christmas still be worth it?

OK, hands down all the Grinches who think it's not worth it now. This is a thought experiment about public policy, not odd seasonal customs. And there is a curious cross-party, trans-ideological consensus that the answer to my question is, "No! Certainly not! If things don't keep getting better it's all just dust and ashes."

Seriously. Look at political manifestoes and punditry across the spectrum and you'll discover that no one even debates wealth. All they talk about is growth. Public discussion takes place as if it were incontrovertible that a man with $400 million would be unable to sleep nights were he not convinced next year he'd have at least $412 million.

I realize, incidentally, that this man had $700 million back in August and will be lucky to reach Easter with $200 million while the rest of us worry that we won't be able to afford needles next year, let alone trees. And I certainly hope things get better not worse. I'm not advocating penury as a solution to a slump. My view of voluntary poverty is that it's fine provided it's voluntary. All I'm saying is that there's something very peculiar about the way we frame public policy questions and this peculiarity risks extending deep into our personal lives.

Consider this throwaway line from a recent Fraser Institute book on taxation: "Economic growth is a widely used indicator of an economy's health. It is measured by the annual percentage change in a nation's gross domestic product (GDP)." I cite it not because I think the Fraser Institute folks are weirdos but because whatever their sharpest critics might find to dispute in this book, they'd get to the substance used for the binding before picking on this line. Why?

I'm not against wealth and gadgets and should confess up front that I currently own the coolest car, and phone, I've ever had. My current vehicle is cooler than all the other cars I ever owned put together. So is my phone, now that I come to think of it. And my laptop.

If gains in wealth bought as much happiness as you'd expect then people in the Middle Ages should all have been so miserable they'd have committed suicide if anyone had rope.

But if money could buy happiness it should have by now. King Henri IV of France supposedly said he hoped to see the day when every peasant had a chicken in the pot on Sunday. Fine. They do. What is the aspiration nowadays that requires us not simply to preserve what we have but to keep stuffing fowl into the pot until it bursts?

There is a legitimate national security impulse to have more and better stuff than your enemies. And dynamic growth will probably bring medical advances that matter enormously to those they affect. But not, surely, quality of life elsewhere. Must every book we get for Christmas be bound in Corinthian leather? Do we need cell phones that let us levitate and beam holographs to distant planets? When is enough enough? And if the answer is never, then what good is more?

I can see important arguments for preserving the way of life we now have, so that as people move through the cycle of establishing themselves, accumulating wealth, having families and eventually downsizing as they age, they can capture their special moments with a 2-megapixel cell phone shot rather than daubing them on a cave wall in France with a sheep's foot dipped in gunk. But we have that now. So why does everyone think we must always have more?

Possibly because public authorities have burdened us with an array of social programs whose incentives are as perverse as their financing is unsound, so our only hope is to outgrow our own stupidity and they do not want to focus discussion on the matter and we don't want to either. I'm just saying.

Or maybe everyone is convinced that a free market economy must either expand or die. But I've never seen this case coherently argued and Adam Smith didn't believe it so it's a bit weird that even people who hate him now seem to.

When you get right down to it, how much turkey can a man eat?

[First published in the Ottawa Citizen]

Prime Minister Harper now says the $4 billion the Canadian and Ontario governments have offered GM and Chrysler is probably just the beginning of the ill-considered dumping of public money into companies with bleak long-term prospects. If you've been enjoying the scintillating level of debate on this proposal you'll also enjoy this video: In The Know: Should The Government Stop Dumping Money Into.............. A Giant Hole?

So George Bush has decided to go ahead and dump a preliminary $17.4 billion in public money into the two least successful "Big 3" North American auto makers. It's not obvious where that is in the Constitution but the President explained that "These are not ordinary circumstances." So apparently the idea is that something that would be unaffordable folly if you had money is indispensibly prudent conduct if you don't. I somehow missed that in economic class too.

As the global mental meltdown continues, the wisdom of decades has disappeared in weeks. We are left poorer for it. Take deficits... please. How long did it take us to learn, or say we'd learned, that they were bad? How many politicians swore while campaigning not to run them? And now look.

From the 1960s through the early 1980s, a lot of smart people really believed deficits stimulated the economy. But we ran them and things got worse, then we got rid of them and things got better. In some ways, I realize, governments of every stripe are now running deficits because they're helpless before the dynamics of a modern budget. But their insouciance leaves little doubt that the agonizing experiences of stagflation and runaway interest payments gave them only campaign slogans, not understanding.

What the rest of us learned over 30 years is that "government spending" does not stimulate the economy. When used for legitimate public purposes, like infrastructure or defence, it leaves us better off if done reasonably well. But whenever government spends, it spends real wealth that it must take from the private sector. That's you and me. In hard times, we're less able to bear any given burden. Hence increased government spending is especially bad in a slump.

Clearly politicians believe the opposite with instinctive rather than reasoned passion. Consider this brief story from Monday's Citizen: "U.S. stock index futures slipped, while the dollar and the yen rose yesterday, after world leaders pledged rapid action to combat the financial crisis, but fell short of announcing concrete measures or major regulatory breakthroughs."

In short, politicians announced yet again that they will definitely spend huge sums of money they don't have on things they don't want for reasons they can't specify in ways they haven't figured out. Oddly, confidence wasn't restored.

When they give details, things get worse. Last Tuesday, U.S. Treasury Secretary Henry M. Paulson Jr. announced that the $700 billion "rescue" plan approved by Congress would not, as originally declared, focus on buying bad mortgage debt, but would instead involve purchasing bank shares. But he didn't know if the government would also throw more billions at failing car companies on top of the $25 billion loan program they bagged in September. Or give money to other financial institutions as well. Or also buy bad mortgage debt after all. "Mr Paulson's comments", the BBC observed tartly, "did little to ease continuing investor jitters..." The next day, Mr. Paulson mused about $50 billion maybe going to companies that issue credit cards and make car and student loans. Or not.

As Terence Corcoran wrote in last Thursday's National Post, when governments are in full panic mode, determined to hurl very many billions of dollars in some direction but can't figure out which and keep changing their story, any sane person will get or stay out of the markets until they figure out where the harm, or good, is going to be done. But there's more.

In the 1980s and 1990s, it became a familiar critique of government industrial strategy that the state couldn't tell who the winners were and the market didn't need to be told. And the policy elite all learned to mouth the words that "picking winners and losers" was a bad idea. But evidently they never believed or understood it. All these bailout plans seem to involve giving money to companies governments have identified as key to economic vitality on the basis that they're about to go bust. So politicians are cluelessly unteachable here too. And they have our wallets.

The Globe and Mail recently editorialized that "While there are ample reasons for Ottawa to tell car makers they don't deserve taxpayer bailouts, there are also compelling reasons to provide help for weathering the current storm. The trick will be to provide the right help to keep these critical companies afloat without getting stuck in a corporate welfare quagmire." Strangely, this argument drops any pretence that GM, Ford and Chrysler are winners but urges backing them anyway, which is hard to portray as an intellectual advance on older ill-advised industrial strategies. Especially as no one has a word to say about why policies that were universally deplored as unaffordable folly in booms have become reputable wisdom in hard times. Instead this week's Throne Speech blithely promised "further support" for the "manufacturing sector, particularly the automotive and aerospace industries."

Maybe I should simply be happy no one's yet suggesting we rekindle inflation and see if it helps. But I'm not, because it's going to be a long, dumb winter. And just months ago we were all so smart.

[First published in the Ottawa Citizen]