Conservatives are quite fond of using the tired old your government is like a household analogy to make their point.

Even in bad economic times, conservatives argue that governments cant run deficits — if people ran their household that way, theyd soon be bankrupt and would be unable to continue functioning. Of course, the analogy is more than a little simplistic. Many households seem to manage just fine with varying amounts of debt  from mortgages to car loans to consumer debt consolidations.

Still, for the purposes of this weeks column, Im prepared to grant that the Ontario government is EXACTLY like a household.

The Ontario household is particularly proud of the fact that it hasnt run a deficit in the past four fiscal years. It would like us to believe that it wont be doing so this year as well. Even without taking into account the negative impacts that SARS and BSE (Mad Cow Disease) have had on the economy and government revenues, most observers considered the budget to be optimistic when it was first announced at an auto parts plant.

What lends an air of fantasy to the governments household budget is the Tories reliance on the sale of unspecified assets worth $2.2 billion during the year. Buried deep in the budget documents is an estimate that the total tangible capital assets of the government amount to a mere $13.2-billion.

In other words, Ernie Eves and Janet Ecker think that its a good idea to sell 17% of everything that the province owns in order to make their books look balanced in an election year. If they really were running a household, their proposal would amount to the equivalent of lopping off the roof in order to pay the bills in the rest of the house.

The problem with this is twofold: first of all, houses need roofs; and, secondly, this kind of accounting will only work for a short period before the homeowner has nothing left to sell.

Its not that the Harris-Eves government has been practicing a great deal of restraint in the sale of assets since coming to power in 1995. According to government numbers, they raised $321-million from asset sales and rentals last fiscal year. Of course, thats a far cry from the $2.1 billion that they forecast for that year.

Having backed down on their plan to sell off Hydro One, there simply isnt that much to sell  especially if they continue to insist that TV Ontario and the Liquor Control Board of Ontario are not for sale. Unless the government is hiding some assets (an unlikely scenario), the numbers dont add up.

Last week, we, the members of the Ontario household, got our first hint of exactly what might be for sale. Finance Minister Janet Ecker announced that the government is considering selling the 24 service-station rest stops along two of its 400 series of highways. The rest stops bring in $8.5 million per year in lease payments from the major oil companies  money that would be lost forever if they were sold.

If past experience is any indication, the sale will likely be for far less than the actual value of the asset. When the Tories were prepared to sell Hydro One, their $8.5 billion price tag was well short of what electricity experts thought it was worth. Moreover, without any mandate to act in the public interest, the electricity distributor would likely have cost consumers untold billions of dollars in increased rates if privatized.

The best example of how not to sell a public asset came, not coincidentally, immediately prior to the 1999 provincial election. The government sold Highway 407 for a paltry $3.1 billion in order to finance its tax cut of the week. In 2002, the buyers estimated that the highway was worth four times what they had paid for it.

Since then, tolls on the 407 have more than doubled, bargain tolls for off-peak hours have disappeared, and exorbitant fines for failing to pay have been applied on balances of less than ten cents. The province refuses to renew the drivers licenses of anyone who has unpaid tolls — or renew the 100,000 drivers who were added to the 407 outstanding account database in error). Finally, the government includes unpaid advertising for the highway in every automobile registration package. The 407s owners assumed zero risk when they bought the highway.

The 407 is so synonymous with botched privatizations that the British Columbia Liberals determined that it would be political suicide to go ahead with its plans to privatize the Coquihalla highway (even after spending more than $3 million on the project).

Despite their ideological similarities, the Campbell government has realized that the cut-rate sale of assets favoured by the Harris-Eves governments is no way to balance the budget of their household  or a province.


Scott Piatkowski

Scott Piatkowski is a former columnist for He wrote a weekly column for 13 years that appeared in the Waterloo Chronicle, the Woolwich Observer and ECHO Weekly. He has also written for Straight...