Warning: trim() expects parameter 1 to be string, array given in /home/kaysterling/public_html/wp-content/plugins/the-events-calendar/src/Tribe/Main.php on line 2397
Blog - Canadian Bank Reformers Blog - Canadian Bank Reformers

Paul Hellyer Comments on 2017 Canadian Federal Budget

March 22, 2016: 7PM Eastern – “The tread-water budget presented to-day by Finance Minister Morneau is one of the worst that I have seen. Certainly treading water is not re-assuring when the country is drowning in an ocean of debt. Nor is it responsible to increase that debt by $100 billion over the next four years knowing that there is no way that our children and grandchildren can ever pay it off, and that they will be obliged to pay interest on it forever.

In addition to all this, there is nowhere near enough new spending to meet essential needs. Bank of Canada Governor Poloz has been quoted as saying that there is about a $50 billion shortfall from the slide in the oil industry. In addition, as the provinces have made clear, there is not enough new money for health care. There is not enough new money for urban transportation. The same is true for affordable housing, in addition to municipal infrastructure.

Top that off, as Cindy Blackstock has so eloquently pointed out, the government is defaulting on its responsibilities to aboriginal children. It’s the same story right across the board with a shortfall in essential spending in the order of $100 billion, without including the department of defence.

There is only one way to meet all of these needs and that is for the Canadian parliament, which has the full constitutional authority over money and banking, to get the Bank of Canada to crete the necessary funds as it did so successfully from 1939 to 1974. And Minister Morneau is not telling the truth when he says that would be “excessively inflationary”. It was not during those 35 Golden Years, and it would not be again if privately owned banks were required to hold the new money as cash reserves against their deposits.

So there is a practical, painless solution to our vexatious problems if parliament ended the private banks monopoly on creating money – which is nothing more than a computer entry – and re-instated a system of sharing the money-creation function that worked so well for the best 35 of the last hundred years.” Hon Paul Hellyer

img

Buried government report reveals looming fiscal crisis

A shocking new report quietly released by the federal government admits that their finances could collapse in the coming decades if politicians don’t make responsible choices.

ARTICLE SOURCE: Toronto Sun

BY ANTHONY FUREY, POSTMEDIA NETWORK

http://www.torontosun.com/2017/01/04/buried-government-report-reveals-looming-fiscal-crisis

FIRST POSTED: WEDNESDAY, JANUARY 04, 2017 06:35 PM EST | UPDATED: WEDNESDAY, JANUARY 04, 2017 06:43 PM EST

Government Report in FULL (as refereed to in the article)

Two days before Christmas, when most politicians and their staffers had long left their offices for the holiday break, the finance department released — without fanfare or wide notice — a surprising update on long-term economic and fiscal projections.

The report warns that lower than expected growth combined with higher program spending “would be sufficient to put at risk the fiscal sustainability of the federal government.”

Ian Lee, who teaches at the Sprott School of Business at Carleton University, says Canadians should certainly be worried about these numbers.

“I’m old enough to remember when Pierre Elliott Trudeau first took us into deficits, which were much smaller ones than they are today,” Lee told the Toronto Sun in a telephone interview. “Everybody back then said ‘What’s the big deal?’ But the problem is that debt started to snowball and get out of control. It’s so difficult for politicians to say no and to make hard, difficult choices.”

The forecast also assumes that the budget won’t be balanced until 2055. Projections show it peaking at $38.8 billion in 2035.

This goes against a key Liberal campaign promise.

During the 2015 election, Justin Trudeau pledged to balance the budget before the next election, in 2019. Yet, in the fall fiscal update announced this past November, Trudeau’s Liberal government pushed the goal posts back and projected deficits until 2021 and beyond.

These new assumptions from the finance department now call all of the Liberal government’s numbers into question.

This is not the only alarming figure revealed.

Another key fiscal promise of the prime minister’s campaign was to bring down the debt-to-GDP ratio to 27% by 2019. Yet the finance report also places this accomplishment out of reach.

It instead projects the debt ratio consistently hovering around 31% for the next few years, then dropping to 30.4% by 2021.

Federal debt is also assumed to cross the $1 trillion mark around 2031. It is currently $635 billion.

“The report is very concerning, but it’s not surprising,” Conservative finance critic Gerard Deltell told the Sun. “We already know that Justin Trudeau’s tax-and-spend plan has failed. Full-time jobs are disappearing, taxes higher, and the only solution the Liberals have to offer is more of the same.”

These alarming forecasts are the result of the report’s authors factoring in Canada’s ageing population into its financial outlook. Over the coming decades, an increasing number of baby boomers will move into retirement while relying on fewer workers in younger cohorts to bankroll government services.

“What really concerns me is that they’re borrowing for current spending,” adds Lee. “It’s one thing to borrow to buy a house. It’s another thing to borrow to buy groceries. They’re borrowing to finance consumption instead of long-term assets. I don’t think it’s going to end well.”

The report is not all doom and gloom, though. It acknowledges there are upsides should growth improve and points out that government could make financially-sound choices to send the numbers in more optimistic directions.

“While no single initiative can guarantee sustainable growth in our prosperity, the potential payoff from acting now in a broad range of policy areas is very large, as measures tend to reinforce themselves over time,” the document advises.

•Returning to surplus

Trudeau’s campaign promise: 2019

Finance department’s forecast: 2055

•Reducing the debt ratio

Trudeau’s campaign promise: down to 27% by 2019

Finance department’s forecast: still up at 30.4% by 2021

•Still not balancing itself

“The commitment needs to be a commitment to grow the economy and the budget will balance itself.”

— Liberal leader Justin Trudeau, 2014

•Gloomy future

“I don’t think it’s going to end well.”

— Ian Lee, Carleton University

•Federal debt projections

-2017: $635 billion

-2021: $746 billion

-2030: $992 billion

-2045: $1.5 trillion

ARTICLE SOURCE: Toronto Sun

BY ANTHONY FUREY, POSTMEDIA NETWORK

http://www.torontosun.com/2017/01/04/buried-government-report-reveals-looming-fiscal-crisis

FIRST POSTED: WEDNESDAY, JANUARY 04, 2017 06:35 PM EST | UPDATED: WEDNESDAY, JANUARY 04, 2017 06:43 PM EST

Government Report in FULL (as refereed to in the article)