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!

quote:

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.

___________________
"The function of music is to release us from the tyranny of conscious thought." — Sir Thomas Beecham

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.

quote:

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.

quote:

Originally posted by VERTiG0 Playa24_7 BILLION DOLLAR DEFICIT

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

___________________
Deviant Art - Smuncky
My Photos on Flickr
If anyone wants to share their clubbing/nightlife pics go to Toronto Nightlife
"The best car-related innovation we have is not to improve the car, but eliminate the need to drive it everywhere we go.” -Alex Steffen

quote:

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.

___________________
My party schedule:
2009-02-21 - DJ Attention @ I'm So Popular
2009-06-18 - DJ Annoying @ People Need To Know Where I'll Be
2012-11-32 - DJ Insufferable ɸ Or At Least the Stalkers I Complain About
2048-06-66 - Spastic & Whocares ¶ Although I'm Actually Flattered
9999-45-81 - Tweaker Gimp ☼ I Probably Won't Even Go To This But I Have To Make Sure I Fill Up All The Available Space Here

quote:

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).

___________________
We are the kids of the quiet revolution, and we fight for a new quiet concept of evolution. We play house music.

quote:

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

___________________
"Silly Clubbers, Docks are for Boats"
Soundcloud

quote:

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

...seriously?

___________________
My party schedule:
2009-02-21 - DJ Attention @ I'm So Popular
2009-06-18 - DJ Annoying @ People Need To Know Where I'll Be
2012-11-32 - DJ Insufferable ɸ Or At Least the Stalkers I Complain About
2048-06-66 - Spastic & Whocares ¶ Although I'm Actually Flattered
9999-45-81 - Tweaker Gimp ☼ I Probably Won't Even Go To This But I Have To Make Sure I Fill Up All The Available Space Here

quote:

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?

___________________
We are the kids of the quiet revolution, and we fight for a new quiet concept of evolution. We play house music.

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.