Quote: Originally Posted by Hoid
Let's see - Chretien/MArtin paid the federal debt down for nine straight years to the tune of $90 billion.
Uhm, not quite. In the first four years of the Chretien government Canada was in recession. Chretien ran big deficits for those first four years. Then, as the world economy improved and money started flooding into federal coffers - in no small measure from the GST he had campaigned against, and because he slashed health care, education and social safety funding FAR worse than Harper, he was able to start building surpluses.
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Harper inherited a $14 billion surplus and over the course of 6 budgets increased the federal debt by $150 billion
This is misleading. The Harper budget deficits were as follows:
2007-8 +9.6b
2008-9 -5.8b start of recession
2009-10 -33.4b start of incentive funding
2010-11 -55.6b height of incentive funding
2011-12 -26.3b deficit cut in half as incentive funding is slowed
2012-13 -18.4b
2013-14 --5.2b
2014-15 balance
So we can see Harper dealing with a terrible recession through incentive spending, but let's not forget the three opposition parties were not exactly opposed to this. In fact, they absolutely insisted on it, to the point of forming an agreement to end his minority government so they could take over and deliver the incentive spending they said we desperately needed. And their only complaint was that there wasn't enough of it.
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Is HArper the single worst fiscal manager in Canadian history? Obviously Mulroney has the numbers in that department but the early 80s recession and the crash of 89 are mitigating.
Here's what's more mitigating. Trudeau the elder took over with virtually no debt. He doubled spending in his first term in office, and then doubled it again in his second. Clearly it would have been ah, politically difficult, to also double taxes, so he just borrowed the money. Then came a recession. Did he stop borrowing? Of course not! You can't suddenly slash your budget deeply as a recession hits! So he kept borrowing, only now he was borrowing at double digit rates. The debt exploded, and the payments took more of the budget, which required more borrowing.
Then Mulroney took over. His choices were sub-optimal. He could either slash the spending in a terrible stagflation recession, or continue to borrow money. He cut somewhat, as he could, but also had to borrow money. Again, under double digit interest rates. The important thing to remember is that he managed to get the operating budget down to the point where, if it weren't for all that debt, he would have had a balanced budget.
Why did he have all that debt? Because of Trudeau the elder.
Now we have Trudeau the younger, who learned from papa that if you give people lots of stuff but don't make them pay for it, they'll vote for you. What he failed to learn from papa is that this is okay until you hit a bad recession and interest rates rise. Then it bites you on the ass.
And btw, I loathed Trudeau the elder, Mulroney, and Chretien (I tolerated Harper), so I believe I'm being somewhat unbiased.
[6] 32.5% 1,649.2 2015 612.3 (627.21) [6] 31.0% 