Deep, dark hole
It’s official. We are the Greece of Canada. By 2020, every adult and child in this province could owe more than $40,000 as a share of the provincial debt. And that’s only if the Liberals’ pessimistic fiscal update released last Tuesday is pessimistic enough.
(Actually, the per capita debt of Greece last year was $38,000. Canadians owe about $34,000 a head, while the worst debt per person in the world is Japan, at just under $100,000.)
Neither Finance Minister Cathy Bennett nor Premier Dwight Ball seemed to be holding back punches Tuesday.
“If left unchecked, the extremely difficult fiscal reality facing our province will only worsen,” Bennett said. She then outlined a number of belt-trimming measures to keep government spending in check.
“We value and recognize the public service - their experience, knowledge and dedication is crucial to fulfilling the mandate we have set out,” she said in a statement.
“We need to utilize our public service so we can operate more efficiently while delivering programs and services that Newfoundlanders and Labradorians expect and deserve.”
Ball, meanwhile, refused to clarify whether that means he might break his promise of no layoffs. But their buttering up of public employees suggests some won’t be very happy with what’s to come.
Many felt the news on Tuesday was predictable. The deficit will double to almost $2 billion this year. That blows away any previous record. Without radical changes in the way things are done, Bennett said, the total debt could rise to more than $20 billion by 2020.
None of this is the Liberals’ fault. They campaigned blind, since the outgoing Tory government wouldn’t release the numbers before the election.
In fact, not all the blame can be laid with the Conservatives either.
It’s fair to factor in the cost of the Muskrat Falls project, of course - even though it falls under a different category than regular expenditures. Yes, the Williams administration overspent when the going was good. And since the drop in oil prices, subsequent premiers have been far too optimistic in their projections.
But this is a worldwide downturn. Alberta and Ontario are both in a major fix as well. It’s important to remember that while we’re staring into the abyss, screaming at our own politicians for the mess we’re in.
The only question now is, will the premier swallow his pride and put other austerity measures back on the table - including some sort of new tax revenue?
Because it’s long past the time for coy, noncommittal answers.