Government’s first objective in dealing with ballooning deficits and crushing debt should be to recognize the problem and then publicly acknowledge it.
That sounds self-evident.
Yet it is not happening, due to an ideological mindset that denies the very idea that there is a problem.
Still, warning signs right across Canada are impossible to ignore. The day before Christmas, the Department of Finance projected deficits continuing to mid-century, with debt mounting to $1.5 trillion by 2045. That’s startling, since only two years earlier the Department projected that all the debt would be paid off!
In 28 years, our children and grandchildren will be on the hook for $82 billion in annual interest. The problem is, debt undermines long-term growth. Debt-service obligations divert funds from social programs and drive up taxes, making life less affordable and businesses less competitive.
Furthermore, North America is hit by a recession or slowdown on average every eight years.
What do you do then?
And then there is inter-generational unfairness. A recent Manning Centre poll revealed that 82 per cent of Millennials believe the deficit and debt are major problems.
Government first has to understand and then explain that there is no free lunch. When he prepares his budget, the Minister of Finance must be "Doctor No."
Yet, the Liberals’ election promise of a “modest” deficit of $10 billion quickly tripled. Then they backtracked on bringing the budget into balance in four years.
At that point, every rent seeker and special interest group was at the trough.
WATCH as I explain what the Liberals' Finance Minister must take into consideration when tackling this urgent issue.