Standing for everything, and nothing, lying about it all.

[Wilber]

Imo the problem with society is that no one wants to take responsibility. Its like the 2008 housing crash. People went around solely blaming bankers for what happened. Yeah the bankers shouldnt have been loaning money willy nilly, but people should be asking for thise loans in the first place.

Just because you can, doesn't mean you should. Ultimately it is up to the individual to decide whether they can or should buy something or take on debt and the responsibility for that decision is theirs.

Edited October 15, 2015 by Wilber

[Argus]

Gosh, you mean politicians use taxes to get votes?

Didn't know that.

Things like cutting taxes and giving families a UCCB benefit count too so cut this hypocritical nonsense.

So you post an opinion on the need for building highways, roads, bridges, hospitals, et al, and when it's pointed out the great majority of this money isn't even for any of that you say I'm being hypocritical? Seriously? Why don't you just admit you don't care what he spends the money on as long as it helps him get elected?

[Argus]

More to the point, there's no reason to expect that the Tories' revenue projections and tight margins are going to survive four years intact.

The Tories could not go back into deficit at this point without some kind of overwhelming economic backslide to blame for it. They only managed to hold their base together last time because it was the great recession, and because the opposition would have done it anyway.

Trudeau, on the other hand, will, I predict, go the Dalton McGuinty route. Hey, he has the same adviser. He'll throw every kind of thing he can into the current government budget, including pencils that are to be used in thirty years, and claim that in reality, there's already a big deficit. Then he'll tack his deficit onto that one and blame Harper for having a $20 billion, not $10 billion deficit.

[Argus]

Governments are not households. The nature of sovereign debt is wholly different.

One thing which isn't different is that the bigger the debt, the bigger the minimum payment. And when interest rates rise, that minimum skyrockets.

I was opposed to Harper lowering the GST and have always said so. I'm opposed to unnecessary deficits now.

[Argus]

Governments use debt to build infrastructure all the time.

Trudeau is using it to increase overall program spending commitments.

Edited October 15, 2015 by Argus

[Argus]

Funny how people make a big deal about a projected small deficit of about 3% of the budget (and less than 1% of the total economy) per year but completely ignore the infrastructure deficit that is ongoing.

Most of the Liberal increases have nothing to do with infrastructure.

[Wilber]

One thing which isn't different is that the bigger the debt, the bigger the minimum payment. And when interest rates rise, that minimum skyrockets.

I was opposed to Harper lowering the GST and have always said so. I'm opposed to unnecessary deficits now.

Yup and every dollar spent servicing existing debt is a dollar not available to future governments for program and capital spending.

[Wilber]

Governments are not households. The nature of sovereign debt is wholly different.

The only difference is the government can print money an impose taxes to pay for it.

[Smallc]

So you post an opinion on the need for building highways, roads, bridges, hospitals, et al, and when it's pointed out the great majority of this money isn't even for any of that

But it is for that. The total deficit will be $25B over the 3 years. The total new infrastructure spending will be $17B over the 3 years.

[blueblood]

Just because you can, doesn't mean you should. Ultimately it is up to the individual to decide whether they can or should buy something or take on debt and the responsibility for that decision is theirs.

That was a typo at the end. Its shouldnt. Ill edit

[dre]

Just because you can, doesn't mean you should. Ultimately it is up to the individual to decide whether they can or should buy something or take on debt and the responsibility for that decision is theirs.

Thats fine, but you are not going to escape macro-economic consequences.

When interest rates go down and credit is eased people WILL borrow more, and MORE people will borrow. If rates are really low for a long time people will borrow more than one might think they should. Eventually rates will go back up, but even if they dont people will hit a point where they decide enough is enough and they decide to rebuild their savings. Thats what we call a recession.

The important thing to realize is that levels of household debt are not an accident... they are government policy. The direct result of massive credit easing and super low interest rates. All that money was borrowed and spent into the economy which allowed the government to pretend they had avoided the great recession. But all they did was kick the can down the road... Because credit easing does not create consumption it just moves consumption from tomorrow to today. When tomorrow comes around there will be less consumption because people have less disposable income as a result of debt maintenance. Thats a recession as well.

Its all well and good to say "people should be responsible", but the reality is people have done exactly what the government and banks wanted them to do.

[Wilber]

Its all well and good to say "people should be responsible", but the reality is people have done exactly what the government and banks wanted them to do.

It not that they should be responsible, they are responsible. The government wasn't holding a gun to anyones head and forcing them to borrow.

[Wilber]

The government also upped RRSP limits and introduced TFSA's giving people incentives to save. It is up to the individual which path they want to take.

[poochy]

The lpc candidate in my ridiing has his voice on radio claiming to be against the pipeline, while the Co Chair of the campaign is training the company that wants to build it on how to lobby the future liberal government that he will be a memeber of, it's just so typical of the lpc.

So clean, so nice, so much better, so caring about the water, so much complaining about no environmental laws (lie), and against a pipeline project while helping the company to build it, lying about it all. O but of course he was the only one who knew about this, he was the lone wolf, just like Nigel Wright. I bet that pipeline is worth more than $90,000, but the liberals being so clean and above board, so untouchable couldn't be involved any further. Not that this matters a whit to the die hards, there is not a hammer big enough to shatter their shared illusions of this 'new' lpc.

[poochy]

But it is for that. The total deficit will be $25B over the 3 years. The total new infrastructure spending will be $17B over the 3 years.

"Altogether, I calculate annual spending under the Liberals would be about $15-billion higher, on average, than under the budget plan. Of that total, little more than a quarter — about $4.2-billion a year — would be for infrastructure. And of that, two thirds is infrastructure only in the sense that easier EI payments are an investment: the party calls these “social infrastructure” (e.g., daycare centres) and “green infrastructure” (e.g., water filtration plants)."

http://news.nationalpost.com/full-comment/andrew-coyne-a-liberal-fiscal-plan-thats-all-for-show

In other words, bullshit, and it's sad to see someone generally so rational that has fallen for it, and no, Coyne hasn't been anything near a conservative friend during this camapaign, there is no reason to doubt this article, and he isn't the only one that has said this.

Edited October 15, 2015 by poochy

[Smallc]

https://www.liberal.ca/files/2015/10/A-new-plan-for-a-strong-middle-class.pdf

Pg 77 and Pg 85.

What he's doing is ignoring the spending in the 4th year whilst also not counting the surplus (which I forgot to do). That results in $17B out of a $24B cumulative deficit over 4 years being for infrastructure.

Edited October 15, 2015 by Smallc

[dre]

One thing which isn't different is that the bigger the debt, the bigger the minimum payment. And when interest rates rise, that minimum skyrockets.

I was opposed to Harper lowering the GST and have always said so. I'm opposed to unnecessary deficits now.

Not necessarily true. A lot of sovereign debt is in the form of bonds with interest rates and payments that are locked in until the bond matures. Sometimes as long as 5, 10, 20 or even 50 years with higher rates for bonds that take longer to mature. Increasing interest rates will force the government to sweeten the deal it offers on the sale of new treasury instruments but it wont necessarily increase the cost of maintaining existing debt.

Right now the government is paying out 2.2% yield on a 30 year bond but only .5% on a one year bond. Even 5 year bonds are just over 1%. Now is a good time to lock in new financing for things like infrastructure upgrades, and other things we know for sure we are going to have to fund.

This is the best deal the government has gotten on long term bond sales since 1957.

[dre]

It not that they should be responsible, they are responsible. The government wasn't holding a gun to anyones head and forcing them to borrow.

Yes thats more or less what they were doing. They were desperate to prop up domestic consumption and they created some of the easiest credit conditions in Canadian history. Government: "Pleaaaaase Pleease Please borrow money and spend it! Save us!".

When you set the macroeconomic conditions for it people WILL borrow.

Edited October 15, 2015 by dre

[Wilber]

Not necessarily true.

---SNIP---

Then borrow more, more and even more, you may never get a better chance to go into hock. Edited October 15, 2015 by Charles Anthony
[---SNIP---]

[Wilber]

Yes thats more or less what they were doing. They were desperate to prop up domestic consumption and they created some of the easiest credit conditions in Canadian history. "Pleaaaaase Pleease Please borrow money and spend it!".

When you set the macroeconomic conditions for it people WILL borrow.

No need if the Liberals get into power, they will do all the borrowing necessary and the tax payer will have no say on what it gets spent.

[dre]

No need if the Liberals get into power, they will do all the borrowing necessary and the tax payer will have no say on what it gets spent.

They DO have a say its called an ELECTION.

Then borrow more, more and even more, you may never get a better chance to go into hock.

No but if you KNOW you are going to have to finance projects over the next while now is the time to do it.

And all this deficit hawkery is non-sensical. All organizations and people finance things. Its neither inherently good or inherently bad, it depends what the money gets spent on.

[Wilber]

I was around when his father sent us down the road before and I am hearing the same hawkery used to justify it as I did then. Nothing has changed, it is deja vu all over again.

[Argus]

But it is for that. The total deficit will be $25B over the 3 years. The total new infrastructure spending will be $17B over the 3 years.

Coyne and Simpson disagree, and I trust their neutrality on numbers better than you and Justin.

[blueblood]

I was around when his father sent us down the road before and I am hearing the same hawkery used to justify it as I did then. Nothing has changed, it is deja vu all over again.

I agree. Unfortunately a lot of people are clueless as to use debt in a responsible manner hence why you guys in bc have a housing gong show, vehicles are priced at what they are, etc.

Canada has had its knuckles rapped by the bond vultures already over spending gone out of control. Out of control spending starts with small deficits and govts unlike households can kick the can down the road.

If anything govts should be more inclined to follow a budget.

Canadians had to live with the gst being implemented, i would hate to see tax increases especially when they have been coming down. But try to convince urban people that high taxes are not the way to go when they are used to have their garbage being collected.

[Argus]

Not necessarily true. A lot of sovereign debt is in the form of bonds with interest rates and payments that are locked in until the bond matures. Sometimes as long as 5, 10, 20 or even 50 years with higher rates for bonds that take longer to mature. Increasing interest rates will force the government to sweeten the deal it offers on the sale of new treasury instruments but it wont necessarily increase the cost of maintaining existing debt.

Right now the government is paying out 2.2% yield on a 30 year bond but only .5% on a one year bond. Even 5 year bonds are just over 1%. Now is a good time to lock in new financing for things like infrastructure upgrades, and other things we know for sure we are going to have to fund.

The problem is that if those short term bonds and their low yields are for ongoing program spending which will continue after they mature then they'll have to be replaced at a higher rate unless the government is actually paying down debt, not incurring more. Even the 30 year bonds will have to be replaced, because we sure aren't going to pay off our debt in 30 years. And this is an ongoing process. It's not like we have 30 years until our bonds become mature. They become mature every year (from past borrowing), and if we're in deficit, have to be replaced by more borrowing at the existing rate.

We pay $40 billion a year on interest at these abnormally low rates. At a more normal rate of interest that will certainly shoot up past $80 billion. If that happens and we're still in a deficit situation, or not in a huge surplus situation, then the government will have to find an extra $40 billion to pay every year, and most likely that will mean higher borrowing in order to pay for our previous borrowing. This is what happened to Mulroney.