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-- Ontario Record 24.7 BILLION DOLLAR DEFICIT!!!

Ontario Record 24.7 BILLION DOLLAR DEFICIT!!!

McGuinty and his Liberal goons are now officially worse than Bob Rae's NDP. I remember when people gasped in 1991 over a $10 Billion deficit.

Somebody has to pay for things like ehealth i guess! Cant wait for th HST! Bend over Ontario, you voted for it!

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Ontario�s financial woes are worse than once thought. Finance Minister Dwight Duncan confirmed Thursday in his fall economic update the province�s deficit is predicted to swell to a higher-than-expected $24.7 billion for 2009-10. Earlier this week there was speculation the province�s debt would fall between $18 billion and $22 billion and that red ink would result in public service cuts. Duncan won�t divulge which programs may be scrapped in an effort to save money until he delivers the annual provincial budget next spring. "We will call on our partners in the public and the broader public sector to help us sustain public services in the long term," Duncan said in economic address . "It is incumbent upon all of us to participate in this vital conversation - to help us build consensus on how to manage through this challenge." The province's plan to fund full-day junior and senior kindergarten programs is expected to still go ahead. "Our task in these times are clear: create jobs, help families and establish the conditions for future economic growth," the finance minister said. The government blames the record deficit on a 48.1 per cent reduction in corporate tax revenues, which resulted in a loss of $6 billion for Ontario. The global recession also took a heavy toll and resulted in a near-12 per cent contraction in world trade this year. Duncan said the international economic situation caused the province�s economy to shrink to the size it was in 2005. Duncan also believes the province�s gross domestic product will drop by 3.5 per cent this year, but added modest gains of two and three per cent, respectively, for the following two years are expected.

Playa24_7 BILLION DOLLAR DEFICIT

Political scandals aside, it's not surprising, nor do I think it's alarming for provincial governments to go into deficits during a recession. It's kind of impossible not to - especially in Ontario, where corporate tax revenues from the auto and manufacturing sectors are bound to be weak. Add to that the onus on governments to increase spending to stimulate the economy, and it comes down to simple math.

The revenue side they can't do anything about.
On the spending side of the equation, they are damned if they do and damned if they don't. There is no good solution here. A balanced budget isn't necessarily best during a shit economy.

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Originally posted by Skipper Political scandals aside, it's not surprising, nor do I think it's alarming for provincial governments to go into deficits during a recession. It's kind of impossible not to - especially in Ontario, where corporate tax revenues from the auto and manufacturing sectors are bound to be weak. Add to that the onus on governments to increase spending to stimulate the economy, and it comes down to simple math. The revenue side they can't do anything about. On the spending side of the equation, they are damned if they do and damned if they don't. There is no good solution here. A balanced budget isn't necessarily best during a shit economy.

Here is the problem though.. they have raised taxes at record levels, they have already cut program spending, and they are about to do more cutting and raise more taxes. They say that the revenue is similar to 2005 levels. Great! so why not keep spending at that level??? I dont recall 24.7 billion deficit in 2005. Its disgusting to see this mismanagement on top of being asked to fork over a lot more money to them.

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Originally posted by VERTiG0 Playa24_7 BILLION DOLLAR DEFICIT

cmon, i can't be the only one who lol'd at this.

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Originally posted by Skipper A balanced budget isn't necessarily best during a shit economy.

Oh? I'd like to know where you picked this up. Everything I've ever read on the subject says that running significant budget deficits during a recession (or at any other time really) is trading short-term relief for long-term misery.

Just think about the interest on that debt. The higher those payments get, the harder it becomes to get back in the green, and the longer the "recession" will drag on.

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Originally posted by DigiNut Oh? I'd like to know where you picked this up. Everything I've ever read on the subject says that running significant budget deficits during a recession (or at any other time really) is trading short-term relief for long-term misery. Just think about the interest on that debt. The higher those payments get, the harder it becomes to get back in the green, and the longer the "recession" will drag on.

It's contrary to the whole Keynesian "prime the pump" philosophies of macroeconomics. A significant contributing factor the great depression was the incessant ideology that balanced budgets would right the economic turmoil at the time. I think this is what she may be alluding too. John Kenneth Galbraith's "The Great Crash" would be a good start (not to mention probably the best written piece of literature on the great depression).

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Originally posted by slingshot It's contrary to the whole Keynesian "prime the pump" philosophies of macroeconomics. A significant contributing factor the great depression was the incessant ideology that balanced budgets would right the economic turmoil at the time. I think this is what she may be alluding too. John Kenneth Galbraith's "The Great Crash" would be a good start (not to mention probably the best written piece of literature on the great depression).

i see your studies are going well

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Originally posted by slingshot John Kenneth Galbraith's "The Great Crash" ... [is] probably the best written piece of literature on the great depression

...seriously?

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Originally posted by DigiNut ...seriously?

Galbraith is arguably the best economic writer of our time...this is actually a pretty widely held view amongst economists as well. The man could write. I'm not sure what you're trying to imply here?

the implication is that TA is full of brilliant economists and historians while Galbraith is a hack. take from that what you will

correct me if I'm wrong, but isn't it a particular type of spending that Keynes advocated, namely on 'things' (to be overly simplistic) or things that provided future returns? e.g. investing in infrastructure, education, etc? the idea being that doing so is not merely short term relief or band-aid solution, but rather provides lasting future returns in addition to having an immediate impact (e.g. on employment levels, which has obvious spinoffs benefits)

point being that to simply say "during a recession, deficit = bad" is ignoring the nature of that spending.

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Originally posted by MarkT the implication is that TA is full of brilliant economists and historians while Galbraith is a hack. take from that what you will correct me if I'm wrong, but isn't it a particular type of spending that Keynes advocated, namely on 'things' (to be overly simplistic) or things that provided future returns? e.g. investing in infrastructure, education, etc? the idea being that doing so is not merely short term relief or band-aid solution, but rather provides lasting future returns in addition to having an immediate impact (e.g. on employment levels, which has obvious spinoffs benefits) point being that to simply say "during a recession, deficit = bad" is ignoring the nature of that spending.

too bad ehealth, consultants, foreign junkets and god knows what other waste going on doesnt return results....

And how bad is it when the forecast from this year goes from 5 billion to 24 billion in 8 months??? amazing.... until now the record deficit was 12.4 billion under bob rae. The liberals have doubled that within months!!!

I really hope Ontario wakes the fuck up and gives this government the boot, I mean seriously after everything that has happened in the last few months, if he gets re-elected, I will loss all respect for Ontario voters.

I wonder what kind of cuts they are going to make after publicly critising the PC government of the 90's so much?

Dalton Days? Continued attacks on pensions, and a borrage of legislation against the middle class. Remember they cant upset the visible minority Liberal voters.

And I seriously cringe at the thought of more taxes. God I fucking hate Dalton.

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Originally posted by DigiNut Just think about the interest on that debt. The higher those payments get, the harder it becomes to get back in the green, and the longer the "recession" will drag on.

Very true, and DBRS cut Ontario's debt rating yesterday following the announcement.

net net though, essentially every province is due to run a deficit this year, and I don't believe a change in power in those governments would result in anything different.

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Originally posted by slingshot It's contrary to the whole Keynesian "prime the pump" philosophies of macroeconomics.

There is one very very big problem with Keynesian economics... NO ONE ACTUALLY DOES IT. I'd totally be down with Keynesian policies IF governments would cut back in good times and save money. That seems to be the part that ALL governments (yes Jayx, even conservative governments) seem to forget. Of course you should be spending money to "prime the pump" during bad times; however, that money should be coming from the surpluses that you squirelled away during the good times.

.

quote:

Originally posted by VERTiG0 Playa24_7 BILLION DOLLAR DEFICIT

I shouldn't have used the same financial advisor as Nicolas Cage I guess, fack!

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