Liberal (Minority/Majority) Government 2025 - ???

[rnkelly]

Here's the Macros. Where would you cut?

View attachment 102985

Stupid question, is there a name for this type of graph. I kinda like it.

This thread is making me seriously question some pretty basic Canadian policies. Not that I don’t want to be generous but sure doesn’t seem fit for purpose nor sustainable. Just from a household budget standpoint, how do we justify living beyond our means. Someone will need to pay, there’s no free lunch. There’s no perfect policy but we can do better than this amount of waste, we don’t have the luxury.

Jason Kenney is in there like a dirty shirt lately, is he preparing the ground for a move.

 

[lenaitch]

Municipalities have to zero their budgets every year too. No massive deficits for cities!

In Ontario, only operating budgets. They can carry long-term debt for capital projects.

 

[ytz]

Stupid question, is there a name for this type of graph. I kinda like it.

Sankey diagram. Used in a lot of literature to show flows.

This thread is making me seriously question some pretty basic Canadian policies. Not that I don’t want to be generous but sure doesn’t seem fit for purpose nor sustainable. Just from a household budget standpoint, how do we justify living beyond our means. Someone will need to pay, there’s no free lunch. There’s no perfect policy but we can do better than this amount of waste, we don’t have the luxury.

From my perspective, we need to at least acknowledge that our structural deficit is mostly driven by transfer programs. People get all in arms about refugee housing or the few million spent on Eurovision. And while sure we can and should debate those, we need to stop ignoring the part that is 60-70% of the problem.

Beyond that, if we're actually talking about government ops, there needs to be some acknowledgement of the tension between efficiency and transparency. How crazy is it that every time I go on TD, I need 3 signatures that take a month to get, during which hotel and ticket prices double. It's absolutely insane how bad this is for transoceanic travel, where every L1 needs a LCOL equivalent doing reviews that take months in advance. When you're talking about business class tickets or en route stops, that delay adds up. But we apply the same idea across everything. And it's killing us. Especially on tech that moves quick, like space and drones. If I need 5 reviews and 1-2 years of bureaucracy for a $10M try and buy, everything I'm doing is 1-2 years obsolete. And I'm sure the same is true for literally everything across the government. Unfortunately, the whole Arrivecan scandal has destroyed our ability to be agile.

Jason Kenney is in there like a dirty shirt lately, is he preparing the ground for a move.

I hope so. Won't lie. He's the kind of conservative I like. Though not sure, how he polls against Carney.

 

[rnkelly]

I hope so. Won't lie. He's the kind of conservative I like. Though not sure, how he polls against Carney.

It wouldn’t hurt to hear both sides and let the best ideas battle it out though. I like it when each side steals from the other when it’s good ideas. Strong competition pushes them to be better.

 

[ytz]

.....

 

[ytz]

It wouldn’t hurt to hear both sides and let the best ideas battle it out though. I like it when each side steals from the other when it’s good ideas. Strong competition pushes them to be better.

It's how effective opposition works. I find it weird when people complain about the other side stealing their policy ideas. That's how it's supposed to work.

 

[Brad Sallows]

Someone will need to pay, there’s no free lunch.

TL;DR: mostly future taxpayers.

When borrowed money comes due for a federal government (and assuming the country has its own money framework), the three main options to pay it out are revenues (taxes, fees, and whatnot), new borrowing (rolled over), or new money created in the money supply. (There is at least one more option: default.) Most indebted governments are rolling over an ever-increasing amount of debt, because obviously new revenues are not keeping pace if there is a net deficit and because increasing the money supply is generally expected to cause monetary inflation.

As long as there are buyers for new debt, rolling debt over can be perpetuated. (If spending growth is gradually slowed, revenues can gradually close the gap.) When there aren't enough buyers for new debt, increasing the money supply to buy government debt is politically less painful than dramatically increasing various taxes and fees. Government probably doesn't really "win" when resulting higher inflation erodes the value of the debt it holds because lenders demand higher interest rates on new debt; long term I doubt it is government that is beating big investors at that game. Default is rare.

Not all government revenues are taxes, hence "mostly".

 

[Halifax Tar]

TL;DR: mostly future taxpayers.

When borrowed money comes due for a federal government (and assuming the country has its own money framework), the three main options to pay it out are revenues (taxes, fees, and whatnot), new borrowing (rolled over), or new money created in the money supply. (There is at least one more option: default.) Most indebted governments are rolling over an ever-increasing amount of debt, because obviously new revenues are not keeping pace if there is a net deficit and because increasing the money supply is generally expected to cause monetary inflation.

As long as there are buyers for new debt, rolling debt over can be perpetuated. (If spending growth is gradually slowed, revenues can gradually close the gap.) When there aren't enough buyers for new debt, increasing the money supply to buy government debt is politically less painful than dramatically increasing various taxes and fees. Government probably doesn't really "win" when resulting higher inflation erodes the value of the debt it holds because lenders demand higher interest rates on new debt; long term I doubt it is government that is beating big investors at that game. Default is rare.

Not all government revenues are taxes, hence "mostly".

Writes TL;DR and then goes on an write a longer, rambling, aimless post.

 

[Brad Sallows]

From my perspective, we need to at least acknowledge that our structural deficit is mostly driven by transfer programs.

Canada has an operating (primary) surplus, and public debt charges alone are greater than the net deficit. Canada's debt cost situation is primarily due to two spending sprees from the mid-'70s to mid-'80s and post-2015. It's the debt, and borrowing to invest or to deal with crises ('70s stagflation era, 2008 fiscal, 2020 Covid) isn't "structural".