A Guide to Reading the BC Budget Tomorrow, Sept. 1
Tomorrow, September 1 the BC Government will present us with a new Budget. This is the second budget of 2009, the previous one having been presented in February 2009. In the meantime we have also had various “updates” from the Premier and the Minister of Finance. These are all recognized by informed observers as something less than accurate. Why has this been so? Shouldn’t voters and taxpayers have the right to know the real numbers, the same as we now are demanding of banks and investment funds and corporations. Shouldn’t governments in fact be setting an example?
The Premier has taken the lead in setting us straight on the real picture over the past nine months. To follow his various assertions it is helpful to remember the basic neo-conservative rules of knowledge as set out by Donald Rumsfield during the Iraq invasion, to wit: “ There are known knowns. These are things we know that we know. There are known unknowns. That is to say, there are things that we know we don’t know. But there are also unknown unknowns. There are things we don’t know we don’t know”.
For the Premier, the past nine months have demanded close attention to these rules. According to him, there has been a steady stream of unknown unknowns and unknown knowns over the past few months – many to do with the province’s finances. In November, 2008 I warned that on the basis of tracking a number of key indicators, government revenues were at that point well below previous government estimates. The Premier attacked me publicly, as he does when he is caught out, by claiming I did not actually know what I knew, and thus for not knowing what I was talking about. Little did I know at that point the importance he placed on Rumsfield’s rules. It became a little bit clearer when two months later he was to amend his position on the knownability of the numbers, stating that he did not know that the economy had tanked back then and thus that his numbers were not wrong but simply involved a case of unknown knowns as far as he and his government was concerned.
The one hiccup in this explanation was that it implied that he now knew the right number. The problem of course was that he had to table a budget. So he admitted that the right number was closer to the number I had predicted than he had acknowledged. But he confessed not that he was wrong but only that the right number had previously been unknowable. However it became apparent in due course that this did not entirely solve the problem of unknowable unknowns, since on budget day in February, he guaranteed a budget deficit of less that $500 million. That much he knew for sure.
Unfortunately for him, the knowable knowns of others reviewing the numbers clearly established this as wrong. But the Premier knew his unknowns by this time, and he was immovable in the budget’s defense. The unknown, as it turned out, was so unknownable as to justify trashing anyone suggesting it could be known. The most we could know was the number he put in the budget, which according to the Rumsfield rules, could not be put to any other than this existential test.
It seems we weren’t listening closely enough and we didn’t understand the Rumsfield rules in other respects. His critics were claiming he was wrong. But knowing something is wrong is different from knowing what it is. And his critics didn’t know what it was and so they could be dismissed as not knowing what they were talking about. So that was the line all through May and June. Then no less an expert than Jock Finlayson of the BC Business Council informed him deficit would be over $2.5 billion. So on June 8th he acknowledged that his knownables now included the fact that the deficit number was wrong. But the correct number was not knowable. And yes, he was aware of this earlier, but there was no need for him to have told voters this, because the correct number was unknowable then as well. There was thus no knowable to reveal. So being the truth seeker that he is, he told us nothing. After all, being the Premier, he didn’t want to be putting unknownables out and about.
It is hard being Premier. You can only talk about knownables and how could he, the Premier know the right number? So he, poor man was all through the winter and the spring, left to defend the unknowable, which is all he could know, if you follow.
To his dismay, some of the less enlightened felt there this was very close to lying. The Premier was understandably dismissive. Just as he has so carefully parsed the difference between the known, the truth, the unknown known, and the unknown unknown on BC Rail, Olympic over-runs and the like, the same rules applied when it came to the true financial situation of the province.
Which creates a bit of a quandary for the reader tomorrow. A budget unfortunately has to contain some actual numbers. It is unlikely that it will be accompanied by a readers guide as to which are known knowns, knowable unknowns, unknowable knows and unknowable unknowns. Based on history to date, the most we can know is that the unknowns will catch up to us when they become knowns (hopefully after the next election). And we can know that it ain’t going to be pretty. But that will be then – not now. Remember the Rumsfield rules.
So don’t rely too heavily on what you read tomorrow. Only the taxes and the cuts will be knowable knowns. The rest will be in one of the other three categories. Which for ordinary folks all mean fiction.