Tory Times are tough Times

Stephen Harper has wondered into an economic minefield in this election campaign with Stats Canada reporting the Canadian economy has reported the worsteconomic grothw and productivity since Brian Mulroney.

Canadian productivity, or output per hour worked, fell 0.2% in the second quarter of 2008, after declines of 0.6% in each of the previous two quarters, Statistics Canada reported. "This is the longest series of consecutive quarterly declines since 1990," StatsCan said.

And according to Merrill Lynch economist David Wolf, it's only though creative bookkeeping that Canada has not fallen into recession:

"It's been a long time since a Canadian federal government has had to choose between supporting the economy and balancing the budget. The winner of the imminent-looking election will very likely face this unfavourable decision."

Mr. Wolf said the only reason Canada avoided a technical recession -- defined as two consecutive quarters of economic contraction -- in the first half was due to a continued expansion in the public sector. However, he said growth in the public sector was unsustainable without further government stimulus, which would likely pull the budget into deficit for the first time since 1999.

Wow. Conservatives have managed to turn high growth and surpluses to deficits in 2 short years, lovely.