Yesterday Finance Minister Dwight Duncan presented the 2012 budget. Dalton McGuinty’s Liberals are touting it as strong action to reduce the deficit, grow the economy, all “while protecting the results we’ve achieved in health care and education“. I’m not going to get into the specific measures outlined in the budget. Instead, let’s take a look at the impending showdown at Queen’s Park.

Tim Hudak says his “Progressive” Conservative caucus will not support the budget, calling it a “weak and disappointing response to Ontario’s jobs and spending crisis“. He suggests corporate tax cuts (shocker) and more aggressive spending cuts to balance the books. However, even before the budget was released, Hudak said he was willing to force an election over the budget, “if need be.” This leaves Andrea Horwath and her NDP caucus as potential kingmakers. Horwath has decided to consult “everyday people” to help her decide whether she should support the budget, wondering “whether or not they bought a pig in a poke when the elected the Liberals” last fall. (Don’t worry, you’re not the only one confused by that statement.)

What would happen in an election? The short answer is, no one knows. Two polls were released on March 15th, one suggesting the Liberals were 10 points ahead of the PCs and the other saying they were 12 points behind. In the October election a total of 17 ridings were won by a margin of 5% or less (9 by Liberals, 4 by PCs, and 4 by the NDP). If these are the “swing” ridings, clearly the Liberals have the most to lose. However, they also have the most to gain. In the 8 non-Liberal swing ridings, 7 had a Liberal in second place. The PCs would be poised to win 1 from the NDP and 6 from the Liberals, while the NDP could pick up 3 from the Liberals. So, after 5 weeks of campaign and hundreds of millions of dollars, we could end up with a PC majority or minority, Liberal majority, or a shockingly familiar Liberal minority. What is clear is that that electorate is extremely volatile and anything could happen.

So the first minority showdown has arrived and it’s particularly crucial for Dalton McGuinty. If Ontario ends up back at the polls and the Liberals lose, he will surely be done in politics. If the Liberals win an election and are sent back with a majority, he will be permitted to retire in a few years in a stable government situation. However, if the budget passes and McGuinty morphs into the deficit slayer, there will surely be a(n even stronger) push for him to run for the federal Liberal Leadership in 2013. When you play the game of thrones, you win or you die. There is no middle ground.