I just listened to a lecture regarding the Canadian economy from the mid 1970s up until 1995. The parallels to the current American situation caught my attention. Essentially, in the mid 1970s, Canada began to spend more than it took in. Government spending and borrowing continued to increase until 53% of the economy was driven by government spending, Canadian tax payers were paying 43% on every tax dollar collected toward interest on debts and the overall debt of the country was spiralling out of control. Due to the rise of the reform party and public pressure, government introduced spending cuts of over 10% (explained in the lecture as being somewhat unprecedented in terms of voluntary fiscal sacrifice) in the mid 1990s. From 1995 - 2005, Canada ran a budget surplus, reducing the amount paid on interest each year to 11% and cut government spending as a proportion of the economy to 37%. As a result of this, during the 10 year period, Canada saw job creation rates that in most years tripled that of the other G7 countries. This while managing to run a highly ranked education system and public health care. By any statistics, there was little percievable drop off in the public well being and general standard of living. In addition, Canada was widely considered to have been in a better position to deal with the recession than most other nations. Of course, their current government has turned to bailouts and deficit spending, but that is another issue. So the question to goes out to the defenders of Keynes. How did Canada's economy improve by taking measures that reduced government spending and cut 80,000 government jobs?
Well, I'm just a tad biased, but I think it had to do with the Premier of Ontario, Mike Harris, and, his Common Sense Revolution....a fore runner to the TEA Party ideals. Moodys downgraded Canada in 1995. Mr. Harris, as premier of Ontario, which is just a little shy of being 40% of the Canadian population (staggering really for one province) hacked and slashed government spending, welfare doles..and the teachers union, and all the other unions (lol) too this day still hate him with a passion. In 2000, Moodys gave us back our triple AAA rating, after 5 years of much hatred and maligning of Mr. Harris. The answer is there for America to see, as is the vitriolic hatred of the answer...but there nonetheless.
Yah, it was suggested that an article in the New York Times about "Bankrupt Canada" and pressure from the Fraser institute were catalysts. Regardless, you agree with my point that the reform was a good model of what drastic action could look like in the United States in the coming decade. Canada is probably lucky to have a more docile public. 10% slashes in Europe would result in... well, I think we've seen exactly what it would result in. As for the Harris issue (just incase you were interested) the lecturer claimed that the primary cuts were at the federal level. The Provinces followed along shortly after. Currently, Ontario is the Province that is leading the way in deficit spending and despite apparent renewed public pressure to cut spending, has no tangible plan to get deficits under control in the next 10 years. The only Province running a surplus is Saskatchewan. The far left NDP party is oddly accredited with historically keeping this tiny province debt free, which raised another point at the discussion - that all parties are capable of committing to balanced budgets, with taxation squables to follow after the priority of not running deficits has been met.
The lecturer isn't wrong. The Fed did cuts, as the Liberal government of the times saw the writng on the wall. It didn't really stop Moodys, and, 5 years later, as Mr. Harris, took the bull by the proverbial horns in the massive economical hingepin province of Ontario, gave back the triple AAAs. If Dalton McGinty, who couldn't balance toilet paper in his hand, to wipe his ass, let alone a budget gets in again for a third term...big trouble on the horizon. The Liberal lunatic is desparate atm, and is going all out, but he has lost what little sense he possessed of rational thought with regards to proper and fiscally responsible governance of Ontario. He has been promising immigrants, students and Government Union Healthcare workers a smorgaboard of illusions, not even in the realm of fiscally possible. I hope Ontario residents don't fall for his obvious false promises, yet again, in a few days as the election is Oct 6th...however, sheep are not just stupid, they apparently have memory issues as well, and there is no telling what will happen.
from CanadianEye I think the key is in this statement "In 2000, Moodys gave us back our triple AAA rating, after 5 years of much hatred and maligning of Mr. Harris." What US politician has the backbone to take this type of hatred? As much as I hate to say it, the only person is Chris Christie (a Republican from New Jersey that will probably not run).
Not to always be the "Ron Paul guy", but it has to be pretty tough to make this statement and overlook Ron Paul. There is no way Dr. No would back down when the public opinion turned viciously against him during the austerity period.
Well, I know I will suffer for this one (lol)...but there is another who has suffered more brutally, as the unofficial leader, of the brutally attacked TEA Partiers (odd how that is huh)...but if this person ever ran, _ _ _ would be more than capable of taking any amount of the vitriolic hate for making fiscally responsible decisions.
lol, congratulations on the bravery required for pointing that out. I'd agree with you, she may be about as bright as a chimpanzee, but I have no doubt she would stick to her guns (you need thick skin up there in Alaska I hear).
Regarding this, we did have a discusion regarding the viability of Keynsian vs Hayek type economic ideas in the eyes of voters. One of the speakers was Stephen Harper's former professor and key advisor and he suggested that there may be an observable patern of governments (regardless of party) being forced into fiscal conservatism by crisis, but then naturally returning to spending as a political means of assuring re-election once the crisis had been forgotten. The conversation then turned to "how do we maintain the awareness and conversation surrounding fiscal responsibility during the good times". It was a fairly interesting thought.
_ _ _ means SHE (i.e. Palin) to sh777Mtl and probably the sentiment of CanandianEye and RON to me. Regardless, neither is electable. Focus on reality. Chris Christie or economic collapse.
Really interested where you heard Saskatchewan was the only province running a surplus. From what I remember Alberta is running a very large one.
I was just clowning around. I am a fan of Palin, and have looked into pretty much all sides of what she is about, from movies made in her defense, to valid complaints about her unpreparedness for "gotcha" questions, to her Alaskan governing record and the PR machinations of both her staff and detractors. Hard to imagine how Liberals/Democrats actually liked her just a little at one point, but the only thing the left is better at than smearing, is being fickle.
I'm almost certain that Saskatchewan is currently the only Province not running a deficit. Alberta ran a surplus years ago. Hell, they even started giving out rebate cheques. Not any more. They have a new far right party emerging to try and right the ship though.
Relatively new, the Wild Rose party is polling at close to even with the established Conservative party that has dominated the province for decades. Think Tea Party vs. Republicans.
