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  • Budget 2018: The Most Disappointing Budget Ever March 14, 2018
    Premier Pallister’s Trump-esque statement that budget 2018 was going to be the “best budget ever” has fallen a bit flat. Instead of a bold plan to deal with climate change, poverty and our crumbling infrastructure, we are presented with two alarmist scenarios to justify further tax cuts and a lack of decisive action: the recent […]
    Canadian Centre for Policy Alternatives
  • 2018 Federal Budget Analysis February 14, 2018
    Watch this space for response and analysis of the federal budget from CCPA staff and our Alternative Federal Budget partners. More information will be added as it is available. Commentary and Analysis Some baby steps for dad and big steps forward for women, by Kate McInturff (CCPA) An ambition constrained budget, by David Macdonald (CCPA) Five things […]
    Canadian Centre for Policy Alternatives
  • CED in Manitoba - The Video January 29, 2018
    Community Economic Development in Manitoba - nudging capitalism out of the way?
    Canadian Centre for Policy Alternatives
  • With regional management BC’s iconic forest industry can benefit British Columbians rather than multinational corporations January 17, 2018
    Forests are one of the iconic symbols of British Columbia, and successive governments and companies operating here have largely focussed on the cheap, commodity lumber business that benefits industry. Former provincial forestry minister Bob Williams, who has been involved with the industry for five decades, proposes regional management of this valuable natural resource to benefit […]
    Canadian Centre for Policy Alternatives
  • Community Economic Development in Manitoba - a new film January 16, 2018
    Cinameteque, Jan 23.  7:00 pm - Free event Film Trailer CCEDNET-MB, CCPA-MB, The Manitoba Research Alliance and Rebel Sky Media presents: The Inclusive Economy:  Stories of Community Economic Development in Manitoba
    Canadian Centre for Policy Alternatives
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Stay the course

The Fall Economic Update was hosted this week by the Fredericton Chamber of Commerce. It seems Minister Flaherty wanted to be sure of friendly faces when he announced that the 2012-2013 budget deficit will likely be $5-$7 billion higher than forecast in March. The reason for the higher deficit is that nominal GDP will be lower than expected, which in turn means lower government revenues.  Given that Europe has returned to recession and the US faces an austerity bomb, there are continued global risks to the Canadian economy.

Minister Flaherty’s message was, essentially, “stay the course”.  There is an unspecified plan that can be executed should the outlook worsen (likely more public sector cuts, as David MacDonald outlines here).

Public spending and public service cuts are probably the most counter-productive response in the current economic climate.  The Parliamentary Budget Officer estimates that the cuts announced in March 2012 will take 1% out of real GDP from 2014 through 2016, and result in 125,000 fewer jobs for 2016.  This all means that government revenues will be even lower than expected, prompting further belt-tightening.

This at a time when Canada’s debt-to-GDP ratio is the envy of other industrialized nations, and borrowing costs are at record lows.  If anyone can afford to borrow to invest in the future, it is Canada, right now.

What to invest in?  The Federation of Canadian Municipalities is calling on the government to invest in critical municipal infrastructure.  This is the kind of investment that puts people to work, makes life better, and improves labour productivity.  This is the kind of investment that businesses rely on governments to make.  A multi-year plan allows smarter and more productive investments.  Real Jobs and Growth kind of stuff.


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