Government Debt-to-GDP ratio - Is Canada sustainable?

[August1991]

Make no mistake, this is the number to look at. As long as the government debt-to-GDP ratio is not rising, governments can borrow and spend.

We Canadians are well within limits.

Unlike people, the State can live forever.

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But what are we collectively buying?

 

[Michael Hardner]

5 hours ago, August1991 said:

 

But what are we collectively buying?

 

Bread.

 

Recently listened to a podcast about the decline of Rome.  Too many perks for the elites, middle class squeezed... Unsustainable debt...

... We seem to do this to ourselves over and over.

[Barquentine]

30 minutes ago, Michael Hardner said:

Recently listened to a podcast about the decline of Rome.  Too many perks for the elites, middle class squeezed... Unsustainable debt...

Not sure Rome's a good comparison. They were an empire staying rich by conquering and 'taxing' others.

And apart from a military pension, they didn't have a social safety net like we have.

But I'll bet they had some epic Toga parties!

[Michael Hardner]

1 minute ago, Barquentine said:

Not sure Rome's a good comparison. They were an empire staying rich by conquering and 'taxing' others.

And apart from a military pension, they didn't have a social safety net like we have.

But I'll bet they had some epic Toga parties!

They did have to feed people, and maintain armies and roads.

Podcast Said that the citizens of Rome itself were leaving to find tax havens if you can believe it.

 

Maybe it's as simple as: the complexities of running an Empire eventually outgrow the empire's abilities to do it.

[Shady]

 

[cannuck]

Rome's homeland had people and infrastructure, but not much in the way of resources - so reaching out and conquering other states is how they financed their orgy of growth.  China is another example - huge population and very short on resources to exploiting the productivity of the people financed by massive debt (300% debt/GDP - but their GDP may be very inaccurate).   The US managed to build their empire from that rare combination of resources, productivity and financial base, but as they grew their empire just as did old Rome their productivity slid to where no longer self sufficient to went very, very deep into debt financing.  While Canada may be a G7 member, we live so close and are/were so integrated with the US economy we foolishly think we are doing something to be in that position.  Well, it's not so much what we do as what we still have = resources.  Our productivity has been ignored except by US car companies so our real economy has never been internally developed.  The only reason we have come this far is by drawing water and hewing wood.  Problem is: even a ruling city full of absolute m0rons can look at other countries and learn to play the debt game.  You might notice the new captain of that ship thinks we can just develop more of our resources and everything will be just fine.   But it won't.  We rip ore out of the ground and sell it for a few hundred bux a tonne or in decreasingly fewer cases process it into base metals and sell it for a couple grand a tonne they buy it back as manufactured goods at 10x to 100x the value (with value added offshore).

Simple answer: the socialist consumer/rape and pillage resources model of Canada is NOT sustainable.

[Michael Hardner]

11 minutes ago, cannuck said:

Rome's homeland had people and infrastructure, but not much in the way of resources - so reaching out and conquering other states is how they financed their orgy of growth.  China is another example - huge population and very short on resources to exploiting the productivity of the people financed by massive debt (300% debt/GDP - but their GDP may be very inaccurate).   The US managed to build their empire from that rare combination of resources, productivity and financial base, but as they grew their empire just as did old Rome their productivity slid to where no longer self sufficient to went very, very deep into debt financing.  While Canada may be a G7 member, we live so close and are/were so integrated with the US economy we foolishly think we are doing something to be in that position.  Well, it's not so much what we do as what we still have = resources.  Our productivity has been ignored except by US car companies so our real economy has never been internally developed.  The only reason we have come this far is by drawing water and hewing wood.  Problem is: even a ruling city full of absolute m0rons can look at other countries and learn to play the debt game.  You might notice the new captain of that ship thinks we can just develop more of our resources and everything will be just fine.   But it won't.  We rip ore out of the ground and sell it for a few hundred bux a tonne or in decreasingly fewer cases process it into base metals and sell it for a couple grand a tonne they buy it back as manufactured goods at 10x to 100x the value (with value added offshore).

Simple answer: the socialist consumer/rape and pillage resources model of Canada is NOT sustainable.

https://en.wikipedia.org/wiki/List_of_countries_by_government_debt

Great post.  I'm confused by the inclusion of China in the list though.  This has them as 21st in the world behind Canada at 10th and the US at 8th.  Italy and Japan in roughly the same boat as us with Greece worse and Japan much much worse.

Using the IMF's General government gross debt, which is the total of all liabilities from federal, provincial, and local governments that require a future payment of interest and/or principal

[Shady]

We can all thank the Trudeau regime for this giant fiscal mess.  Who knew that electing a part time drama teacher that cosplayed a PM and acted like Santa Claus might not be a good idea.

[Nefarious Banana]

2 hours ago, Shady said:

 

Ahhhhhhhh . . . waldo's going to hide behind the couch.  

[cannuck]

1 hour ago, Michael Hardner said:

.  I'm confused by the inclusion of China in the list though.  This has them as 21st in the world behind Canada at 10th and the US at 8th.  Italy and Japan in roughly the same boat as us with Greece worse and Japan much much worse.

Yes, I am quite aware of the IMF numbers, but the real story is not what China is about to reveal.  Could tell you how I come to that conclusion, but then I might have to shoot you.  Have to leave it as nothing you see in or from China is likely true or accurate.  Here is but one analysis (there are many that support this)

https://www.fidelityinternational.com/editorial/article/how-china-keeps-its-debt-in-order-e1feea-en5/#:~:text=If growth slows further%2C LGFVs,effectiveness when implementing support measures.

[I am Groot]

6 hours ago, Michael Hardner said:

https://en.wikipedia.org/wiki/List_of_countries_by_government_debt

Great post.  I'm confused by the inclusion of China in the list though.  This has them as 21st in the world behind Canada at 10th and the US at 8th.

Note that the US can get by with high debt due to being the world currency, and they have all manner of ways to increase revenues if they choose to.

Also note that Singapore's high debt rate is an illusion.

So Canada's is probably more like 8th highest in the world with few ways to increase revenue other than going against government policy and developing and exporting our natural resources.

[I am Groot]

[eyeball]

8 hours ago, I am Groot said:

So Canada's is probably more like 8th highest in the world with few ways to increase revenue other than going against government policy and developing and exporting our natural resources.

Would it be too much to hope that we might direct a good portion of the profit from our resources to paying off the debt, say 50% until we pay 50% off.

[I am Groot]

9 hours ago, eyeball said:

Would it be too much to hope that we might direct a good portion of the profit from our resources to paying off the debt, say 50% until we pay 50% off.

Before we can think about paying off the debt, we need to stop adding to it. And that is not in the liberal government's plans.

[eyeball]

3 hours ago, I am Groot said:

Before we can think about paying off the debt, we need to stop adding to it. And that is not in the liberal government's plans.

Sure, that's a good idea too.

[suds]

Is Canada sustainable?

Here's the real problem. In order to reach a net zero emissions economy by 2050 we're going to have to double or possibly even triple our electrical generation from what's available to us now. That's if the goal is to have emission free power for transportation, heating our homes, keeping our economy going, and yes... it takes a great deal of energy to just get our resources out of the ground and to market. It's not just us either, the U.S. is also looking at a massive energy crunch. As I've mentioned before, our living standards depend on a functioning economy, and any future economy will depend upon even more massive amounts of energy to keep it functioning. We are talking about an immense undertaking when you add in the infrastructure required just to get the electrical generation from point A to point B. I have my doubts if all these undertakings including net zero emissions are even remotely possible. 

Edited September 30, 2025 by suds

[CdnFox]

It's not sustainable, and it doesn't look good that Carney's got a plan to deal with it.

The fear is that interest rates could always rise. The liberal said that was impossible before in 2020 but of course we saw what happened.

If things change and interest rates were to go from about 3% where they're at now ish to say 6%, the effect would be absolutely devastating for us on our interest payments.

Or simply cannot survive much more debt unless our GDP suddenly starts to really climb and I mean GDP per capita not just GDP in total.

[eyeball]

1 hour ago, suds said:

As I've mentioned before, our living standards depend on a functioning economy, and any future economy will depend upon even more massive amounts of energy to keep it functioning.

Keeping the whole shebang running never mind faster and harder will produce excessive heat to build up. Nothing can function like that for long without breaking.

1 hour ago, suds said:

I have my doubts if all these undertakings including net zero emissions are even remotely possible. 

We've been in an unsustainable state for sometime now.

We need to doubt why endless growth is even remotely desirable when it's so obviously self-defeating.

[CdnFox]

2 hours ago, eyeball said:

Keeping the whole shebang running never mind faster and harder will produce excessive heat to build up. Nothing can function like that for long without breaking.

let me introduce you to the sun  

 

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We've been in an unsustainable state for sometime now.

The technology will appear eventually.  We're getting closer.

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We need to doubt why endless growth is even remotely desirable when it's so obviously self-defeating.

It's desirable for current economic reasons.  And that tends to be people's focus. 

But good news, the world population growth HAS radically slowed and is down to a couple dozen million people a year. It's expected to peak within about 60 years and then probably decline.  So about 10 billion people and then shrink for quite a while. 

So we won't be sustaining these levels of growth for long. 

[eyeball]

3 hours ago, CdnFox said:

So about 10 billion people and then shrink for quite a while.

Received wisdom says that will kill the economy and everyone will die.

You can see the writing on the wall but it's all good.

LMAO!

[CdnFox]

13 hours ago, eyeball said:

Received wisdom says that will kill the economy and everyone will die.

You're thinking of climate change.  And that was a hoax   

There's little doubt it will have negative effects but it is what it is. We'll have to adapt as best we can.  Until we learn to colonize other planets at some point there will have to be a max growth, and it looks like it'll be coming up. 

Maybe we can have AI evolved to the point where the computers want to buy things and we can stimulate the economy just by buying more ipads  

 

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You can see the writing on the wall but it's all good.

Recognizing the truth for what it is whether it's convenient or not he's one of the Hallmarks of being a good conservative. Dismissing the facts and lying about it to make yourself feel better is what it means to be a left winger  

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LMAO!

I accept your surrender