WAKE UP, CANADA, TO THE FISCAL MESS WE’RE IN.
A new geopolitical order is taking shape. The globe is rapidly realigning under American and Chinese spheres of influence and the pandemic has only raised the stakes. How can Canada finally get serious about its internal stability and external security so it can effectively play a role as a middle power? That is the question this National Post series will answer. Today: John Robson discusses Canadians’ stupor when it comes to government spending.
In an early instalment in this series Sean Speer sure woke me up by writing “We need to snap out of this collective stupor.” Exactly. He was talking geopolitics, but his appeal applies far more broadly, from health care to the rule of law. And the topic I’m here to deliver a slap on, public finances.
As Dale Carnegie warned, you never persuade anyone with “You’re an idiot because …” let alone “You’re a stunned idiot because …” But you can shout “Hey, wake up, the house is on fire,” and even shake them if necessary. It is.
As I was drafting this column the C. D. Howe Institute released one of its typical studies by a smart, detail- oriented guy, Don Drummond, warning of “Canada’s Foggy Economic and Fiscal Future.” And, as so often, it hit the mark exactly and missed by a mile at the same time, not easy with a single shaft.
As part of my offend- everyone plan, language like “The next generation may be hard pressed to handle a large stock of inherited debt” is not well- calculated to dispel any looming stupor. But not because its English translation “We’re putting our kids in hock up to their eyeballs” is wrong. The problem is that if people were willing to listen to such analysis, it wouldn’t be necessary. It would be intuitively obvious, and we wouldn’t be in this mess.
For years I’ve been preoccupied less with what we should be doing in public policy than with why we’re not, from defence to health to living within our means. It’s rare that both problem and solution aren’t obvious. But we’ve been given the opposite of a truth serum, some drug that renders us groggily incapable of blurting out what we know.
Thus the Canadian Snowbird Association recently did a victory dance over forcing the Ontario government to cover their medical bills in warm, sunny climes they can afford to go to. Some court said refusing to would violate the CHA’S “portability” provisions or some such wealth-conjuring oogabooga. And as my colleague Kelly Mcparland wrote “Seniors, as did most Ontarians, voted heavily for Ford and his pledge to get spending under control” but “Apparently their concern applied only to limits on other age groups.”
What explains this facile, unconscious hypocrisy? “Baby boomers have spent a lifetime electing governments that borrowed heavily to finance generous programs to make life easier, creating a legacy of debt that future generations will have to deal with.” And, he added, not just boomers. “Canadians have for years indicated they want a country they can’t afford.”
Indeed, when challenged about our parlous national finances, new Finance Minister of Everything Chrystia Freeland said “these are things we just can’t afford not to do.” Now Mcparland is not responsible for anything I say, let alone how. But these are his words: “That’s not an answer, it’s a slogan, and a tired, empty one at that. No country can afford to live on loans forever … Country after country has discovered the price of that reality.”
Note again the language of fog, tiredness, lack of mental acuity. Or consider Doug Ford’s decision to cut power prices in Ontario because the system is drowning in debt and excessive costs due to idiotic decisions by Dalton Mcguinty and his not-so-merry-persons that voters somehow slept through and applauded simultaneously.
The only thing to do was say from now on we pay the real cost and yes it’s going to hurt because the problem is real. Which no politician or voter is going to do.
Well, until they have to. At some point, Kipling warned, the Gods of the Copybook Headings return in a foul temper. You can’t play make- believe forever. What? House fire? Leave me alone. Zzzzzzzzzzz. Owwwwww.
So with all due respect to Don Drummond and his four thoughtful, data-driven scenarios sticking in a tree way over yonder, here’s what a serious nation would be serious about fiscally:
❚ Wealth must be created before it can be distributed;
❚ Money is not wealth;
❚ Borrowing has costs;
❚ Who does not work shall not eat; and
❚ Stealing from your kids is wrong.
In some sense refusing to face reality is childish and stupid. But of course it’s ingrained with a great many who are chronologically adults and not formally stupid. As Thomas Sowell wrote in A Conflict of Visions, too many people have always believed we can have whatever we can imagine, provided our sunny ways turn to a vicious snarl if anyone tries to disturb our pipe dreams of world peace, free love or free money with practical difficulties and past experience.
The day the county hauls our belongings away ‘cuz we’re busted, dumping us unceremoniously on the bare floor, we will wonder how we could have been so stupored.
TOO MANY PEOPLE HAVE ALWAYS BELIEVED WE CAN HAVE WHATEVER WE CAN IMAGINE.