Andrew Coyne: The troubling truth about our deficits--they are of choice, not of necessity
nationalpost.com/opinion/andrew-coyne-the-tro...
nationalpost.comPosted Oct 25, 2017, 1:28 AM UTC
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nationalpost.com[deleted]
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And yet you felt the need to grace us with your opinion regardless.
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Well played
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they are of choice, not of necessity
But all government actions are a matter of "choice" in any case, and the notion of "necessity" is subjective. Some believe that purchasing weapons systems is more necessary than alleviating poverty. Some believe that infrastructure spending in ridings held by their own party is more necessary than funding policy to increase social equality. Some believe the contrary.
All believe that it's "necessary" to fund their objectives by whatever means.
So what imaginary existence is Coyne referring to?
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Yup, gst tax cut, tfsa introduction etc were all not nescesaary at all as they targeted income groups that didn't need even more help
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uh... gst cut affects poor people the most, as consumption is a greater part of their spending than it is for everyone else. And the tfsa is for the middle class.
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With every budget the govt has a choice between living within it's means and using excess funds wisely (like paying down the almost $700B current debt).
It seems the govt likes to applaud itself for having a windfall in revenue and then spending that windfall, even though the budget for the year is in deficit. Hero medals, champagne and cigars all around for a job well done!
The only way for this to stop is for the govt to be unable to grow spending through debt - what happens when the music stops?
Yup. It's annoying that all the people who come out in favour of Keynesian spending during a recession seem to conveniently forget that the flip side of that is paying down your debt when the economy recovers so your powder's dry for the next recession.
What’s annoying is that people don’t understand that Keynes wasn’t suggesting that just any spending would count. He advocated for spending that would improve productivity in the short to medium term. This would mean infrastructure, some defence production, short-term job/skills training. A social program with a 20 year time to return is not Keynesian stimulus. We should be paying for those with our taxes. Not deficits.
And it doesn't even have to be spending. A payroll tax holiday would have a massive stimulus effect that Keynes would've strongly approved of.
What's also annoying is people taking Keynes' word as law. Keynes was influential, but mainstream economic theory has advanced somewhat since the 1930s.
Most certainly. But it's one of the few theories that's easy for the average joe to understand and most importantly very easy for the government of the day to twist into justifying more spending.
See the legions of liberal partisans telling us that Keynesianism justifies all this spending, since it's stimulative. They are of course, twisting Keynes theory that government spending should be countercyclical. And not result in large net deficits.
I like this.
Absolute figure of debt is meaningless for a govt. It's debt to GDP that matters. Much like apple has few billions in debt and much larger in absolute terms than say Sears Canada. Which is in better shape?
The debt to gdp ratio is set to drop by 2pts. And thats after deficits are shored