Conservatives to table $40 billion deficit: CTV

Smallc · January 12, 2009

We can talk about the Keynesian Paradox of Thrift when men are selling apples in the street or travelling across the country on the tops of rail cars.

And why would we wait for that to happen?

jdobbin · January 12, 2009

We can talk about the Keynesian Paradox of Thrift when men are selling apples in the street or travelling across the country on the tops of rail cars.

I think when you get to the apples in the street you are acting a little late in the game, don't you?

Canada's economy does not lack aggregate demand. Americans - particularly American financial institutions - lack confidence. IMHO, you don't jumpstart confidence by using my credit card to buy stuff that I don't want.

A tax decrease for banks won't make them loan more. They are hoarding cash.

But Dobbin, why does money going from me to Harper and then to some government contractor who is as likely to spend as save make for a "good policy"? Is the government contractor more likely to spend than I am?

Yes. In the Paradox of Thrift, it makes sense for people to save, pay off debt and not spend. When everyone does it, it compounds the problem.

The theories of Friedman still haven't answered how to deal with that effectively. The first tax cuts by Bush were largely ineffective because of the Paradox of Thrift.

If Harper wants, he can use my (very low interest) credit card for a cash advance. Then at least I'll get the money. IMV, that's better than using the money to buy stuff (some government contractor) that I don't want.

And you are prepared to spend?

August1991 · January 12, 2009

And why would we wait for that to happen?

Uh, how far would you say, Smallc? When inflation is 14% or 23%?

Looking back over the past century, governments have a mixed record in fixing human foibles.

Smallc · January 12, 2009

Uh, how far would you say, Smallc? When inflation is 14% or 23%?

Inflation isn't anywhere near those levels. It is not on its way up. Unemployment on the other hand, is.

blueblood · January 12, 2009

Inflation isn't anywhere near those levels. It is not on its way up. Unemployment on the other hand, is.

Unemployment has been relatively flat and is averaging out at around 7% and has been at that level for some time. If there is a sudden spike to 10%, then there is a problem.

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When our commodities are officially in the tank, then the panic button can be pressed. Oil is still 40 bucks a barrell, and that is the price that AB used to balance its books under Klien. Our commodities are just not ridiculously high as was the case last year. Ag is 1 weather disaster from taking off again.

Smallc · January 12, 2009

Unemployment has been relatively flat and is averaging out at around 7% and has been at that level for some time. If there is a sudden spike to 10%, then there is a problem.

The thing is, the US job numbers are getting worse. If Americans can't buy, then we're SOL. We don't want to wait for unemployment to get higher before we start creating jobs with government money. We want to keep people working and head this thing off before it gets worse.

blueblood · January 12, 2009

The thing is, the US job numbers are getting worse. If Americans can't buy, then we're SOL. We don't want to wait for unemployment to get higher before we start creating jobs with government money. We want to keep people working and head this thing off before it gets worse.

As long as our exports keep churning out and inflation is flat, then we are relatively fine. There are lots of other countries we export to. Energy and food are in a lot more demand than lumber and cars.

If the gov't plans on throwing money around I'd like to see a "program" that involves euthanizing every cow in the country over 30 months old. Check off one industry saved and temporary employment.

Invest in R&D for cellulosic ethanol so the forest industry can start rolling again.

Start building reactors and readying them for export to western Europe and perhaps pop some up in Canada.

madmax · January 12, 2009

Yep, it will be, but it'll also be hard to pin a global problem on Harper. He's not responsible for the global economic situation, and don't forget that this spending is what the opposition was crying for.

The CPC were already fiscally screwed. Canada was experiencing Economic growth, and the CPC were turning the surplus into a deficit. This deficit they wanted to hide in the election, and spring it later, which they have done. Its the trickle up effect....

It will only be x, then 2x, well its 40x now.

I don't recall the opposition calling for a 40Billion dollar deficit. I can't recall any government or party that has an interest in running a deficit.

Government spending in the form of a stimulus package, is being doubled with a tax cut.

This is like the worst of both worlds.

You can do one thing or the other, but not both.

Where did Harper get his degree? The Bob Rae school of economics?

These guys are all a bunch of idealogical goofs.

madmax · January 12, 2009

As long as our exports keep churning out and inflation is flat, then we are relatively fine. There are lots of other countries we export to. Energy and food are in a lot more demand than lumber and cars.

Energy and food demands should remain linear or have a slight decrease. Much like food imports and Energy imports.

However there aren't that many countries we do volume with, regardless of the fact that we do business with many countries.

Smallc is correct. With US purchasing power on hold....

we are not going to be happy campers.

Mr.Canada · January 12, 2009

The CPC were already fiscally screwed. Canada was experiencing Economic growth, and the CPC were turning the surplus into a deficit. This deficit they wanted to hide in the election, and spring it later, which they have done. Its the trickle up effect....
I don't recall the opposition calling for a 40Billion dollar deficit. I can't recall any government or party that has an interest in running a deficit.

Government spending in the form of a stimulus package, is being doubled with a tax cut.

Before Harper prorogued government he said he wanted only a modest deficit. The coalition went crazy. If the Liberals were in power they would have taxed everything with their Green Shift, so spare me the whoa is me routine.

The Liberals are forcing the Tories to raise sending then they'll blame it on them later on. This is their plan.

madmax · January 12, 2009

Before Harper prorogued government he said he wanted only a modest deficit.

And you probably believed him. Some people even believed him in September when he said no deficits. The truth can't be hidden forever. These guys have been absent at the helm. A bunch of elected officials playing around with our money, wasting it and playing out some idealogical games and power plays.

Harper is on the record saying many things, which makes him a great candidate for the LPC.

I would vote against a 40 Billion Dollar deficit.

Mr.Canada · January 12, 2009

And you probably believed him. Some people even believed him in September when he said no deficits. The truth can't be hidden forever. These guys have been absent at the helm. A bunch of elected officials playing around with our money, wasting it and playing out some idealogical games and power plays.
Harper is on the record saying many things, which makes him a great candidate for the LPC.

I would vote against a 40 Billion Dollar deficit.

Well, this is the thing. Do you want economic stimulus or not? Do you want social programs or not? If no to both then you could ask that they cut funding to social programs, arts and no economic stimulus but you'd be in the minority. All the major parties pushed and are getting a stimulus package. All western countries are in similar economic crisis and are providing economic stimulus.

I don't think you have much life experience at all and you clearly do not understand how the world works. Get some life experience and travel some then perhaps you'll understand how the world works kid.

Jerry J. Fortin · January 12, 2009

Economic stimulus? You mean corporate welfare don't you. Let theses failing companies meet their destiny without the tax payer having to fund it. If they are viable then banks can give them money, if not, oh well. The government should concern itself with citizens not business ventures. The social program spending is not what is causing a deficit, its a stimulus package that is. Check your numbers.

Mr.Canada · January 12, 2009

Economic stimulus? You mean corporate welfare don't you. Let theses failing companies meet their destiny without the tax payer having to fund it. If they are viable then banks can give them money, if not, oh well. The government should concern itself with citizens not business ventures. The social program spending is not what is causing a deficit, its a stimulus package that is. Check your numbers.

The Coalition was screaming for stimulus and they got it so don't try to blame it on the Tories.

Jerry J. Fortin · January 12, 2009

I blame nobody. I am against the corporate welfare system. In my view they are all out to lunch on this issue. Why not just convert to communism? At least that way we could have it all! Free health care, no employment issues, no tax issues, that should make everybody happy.........................not.

blueblood · January 12, 2009

Energy and food demands should remain linear or have a slight decrease. Much like food imports and Energy imports.
However there aren't that many countries we do volume with, regardless of the fact that we do business with many countries.

Smallc is correct. With US purchasing power on hold....

we are not going to be happy campers.

We now pretty much have an FTA with Europe, and Europe is in a somewhat Energy crisis. I'm sure our reactors are looking pretty good right now. I think volume with Europe will start shortly providing Europe smartens up it's business ideology.

Topaz · January 12, 2009

Actually, it's more like two. The Conservatives paid down nearly $40 billion on the debt since they were elected.

Yes, they did and I think they got that money from the surplus of the EI and right now there is/was a court battle going on, if the governent has the right to use surpluses they way they chose.Frankly I think if the government is coming up with surpluses then they are charging too much and needs to cut it back into the pockets of the workers.

madmax · January 12, 2009

The Coalition was screaming for stimulus and they got it so don't try to blame it on the Tories.

The CPC want a 40 Billion dollar deficit. The budget is the one that Flaherty and the CPC put forth with Harpers blessing and full support.

Mr.Canada · January 12, 2009

The CPC want a 40 Billion dollar deficit. The budget is the one that Flaherty and the CPC put forth with Harpers blessing and full support.

The Liberals are going to vote in favor of it so take it up with them.

madmax · January 12, 2009

We now pretty much have an FTA with Europe, and Europe is in a somewhat Energy crisis. I'm sure our reactors are looking pretty good right now. I think volume with Europe will start shortly providing Europe smartens up it's business ideology.

American Business Ideology has put the US in such a sorry state of affairs.

Our trade with Europe is 9.8% share of Canada's total external trade. While it is an 8% trade surplus, and is our 2nd largest trading partner, it is dwarfed by our trade with the US.

punked · January 12, 2009

The Liberals are going to vote in favor of it so take it up with them.

Stop it right now. If you like the budget say you like it, if you don't tell the Cons it is their budget take it or leave it. They are the one in power they have been for three year this isn't the Chretien years you can't blame everything on the Libs.

Topaz · January 12, 2009

The Liberals are going to vote in favor of it so take it up with them.

Nothing is certain that the Libs will be in favour, Iggy said it Harper's budget he has to decide what is in it. BTW, did you go to school in the US?? Why I'm asking your"favor" US spelling to my spelling "favour" British or Canadain spelling.

Alta4ever · January 12, 2009

Yes, they did and I think they got that money from the surplus of the EI and right now there is/was a court battle going on, if the governent has the right to use surpluses they way they chose.Frankly I think if the government is coming up with surpluses then they are charging too much and needs to cut it back into the pockets of the workers.

The EI surplus was raided in the 90s by the liberals. It was long gone before the Tories took office, but I guess you have problems comprehending what was said in the news about it a couple of weeks back. It was the liberals who treated it like a tax while reducing benefits.

madmax · January 12, 2009

The EI surplus was raided in the 90s by the liberals. It was long gone before the Tories took office, but I guess you have problems comprehending what was said in the news about it a couple of weeks back. It was the liberals who treated it like a tax while reducing benefits.

The CPC did the same. Tweedle dee and tweedle dum. However, the LPC are inviolation of not using due process and changing rates. I could care less how government steals from the trough, but the CPC used the funds for purposes other then EI, and have the right to do so.

That doesn't make it right, it just makes it justified theft of the EI fund.

I don't see the CPC rushing out to change EI so that money that goes into EI is used for EI. The CPC would be in even worse shape showing an even larger deficit.

Taxpayers lose again.

Alta4ever · January 12, 2009

The CPC did the same. Tweedle dee and tweedle dum. However, the LPC are inviolation of not using due process and changing rates. I could care less how government steals from the trough, but the CPC used the funds for purposes other then EI, and have the right to do so.
That doesn't make it right, it just makes it justified theft of the EI fund.

I don't see the CPC rushing out to change EI so that money that goes into EI is used for EI. The CPC would be in even worse shape showing an even larger deficit.

Taxpayers lose again.

I have seen no proof that the CPC have done the same thing. They erased the unfunded liability and sent up EI as a seperate entity from the General revenue account. How sould they possibly take an EI surplus that has already been spent?