I came across an interesting article the other day on the Fraser Institute’s website. I have to admit, I usually don’t see eye-to-eye with this organization. It’s a conservative think tank who usually recommends very right-wing solutions to our economic and social problems. But they did write an interesting article about debt, deficits, and the need to control spending.
I found this article interesting because many times conservatives talk about eliminating our deficit but they rarely succeed. In fact, they usually make deficits worse. Take Canadian Prime Minister Brian Mulroney. He tripled Canada’s debt in less than 10 years. It was Liberal Prime Minister Jean Chrétien who successfully reduced our debt to manageable levels. In the United States, debt levels skyrocketed under Presidents Ronald Reagan, George Bush (the elder) and his son George W. Bush.
During the last provincial election Ontario Conservative leader Tim Hudak talked about the need to control spending. He even promised to fire 100,000 civil servants to balance the budget. But how bad is our spending problem? And what can we do to control spending? These questions have a major impact on our healthcare workforce.
Over the past 20 years our financial situation has gotten a lot better. In 1993, 33 cents of every tax dollar Ottawa collected went to paying off interest payments on the debt. Today, only 11 cents of each tax dollar goes to debt servicing. In Ontario, it’s even better at 9 cents.
Personally, I would like Canada and all 13 provinces and territories to eliminate their debts entirely. But it’s not that simple. Our debt reduction efforts since the mid-1990s were sidelined by the Great Recession in 2008. If the Federal and Provincial governments didn’t inject huge amounts of cash into our struggling economy, we may have walked into another Great Depression. It’s only now, six years later, our economy is starting to recover.
And there are different ways to balance your books. While Conservatives are always talk about cutting healthcare, education, social spending, and other programs that we all rely on, there are other ways to increase revenue. There is no reason why we can’t increase taxes on corporations or wealthy individuals who make six-digit salaries. While their incomes have skyrocketed over the past 30 years, there is no reason why they can’t afford to pay more in tax. They certainly can afford it.
Yes, we need to control spending. But let’s take a balanced response. A balanced response means trimming spending and increasing revenue. A balanced response is not gutting our social safety net, including valuable healthcare jobs, that took more than 150 years to build