Clemens vs. Clemens
Jason Clemens, who hangs his hat at several right-wing think-tanks (the Fraser, Pacific Research and Macdonald-Laurier Institutes), lauds Canadian fiscal conservatism in todayâ€™s Wall Street Journal:
Canadaâ€™s government, for example, has grown smaller over the last 15 years. Total government spending as a share of the economy peaked at a little over 53% in 1993. Through a combination of spending cuts in the 1990s and spending restraint during the 2000s, it declined to a little under 40% of GDP by 2008. (Itâ€™s currently about 44% due to the recession.)
Reductions in government spending allowed for balanced budgets and the retiring of debt. Federal debt as a share of the Canadian economy was almost halved from nearly 80% to a little over 40% over the same period.
Hereâ€™s how he presented the same facts earlier this year to The Financial Postâ€™s Canadian readership:
All told, the federal government expects to rack up nearly $110-billion in debt due to deficits from the current fiscal year through to 2015-16, when the federal government finally expects to record a small surplus. As a result of these annual deficits, the federal debt will swell to $626-billion in 2014-15 from $464-billion in 2008-09, a nominal increase of 35%.
The culprit behind these continued deficits is the governmentâ€™s unwillingness to address spending. . . . By 2015-16, spending will be $25.5-billion (9%) higher than it is this year (2010-11) and 45% higher than it was when the Conservative took office in 2006.
So, is Canada an example of successful spending restraint or out-of-control spending? It depends whether Clemens is advocating spending cuts in the US or in Canada.