No More Federal Deficits

[c9]

I don't know enough to know if this is actually a good thing, but I think it's a good thing. The federal government will be introducing legislation to require balanced federal budgets. Since 1997, it's been required by the PMO, but not actually legislated.

Certainly in cases of national emergency a deficit is understandable, and in cases of major upheaval / investment it might be warranted (like buying a house and carrying a mortgage), but getting us officially out of the habit of deficits seems like the right thing to do. We ought to spend what we have, not what we wish we had.

The National Post has more details.

Comments

[c9.livejournal.com]

Deficit is the shortfall in a given year. Debt is the accumulated shortfalls over time. So both have bad elements, but deficit spending is the worst because you're making the debt worse, which increases your interest payments, which increases your deficits... etc.

Even when Canada hit $42B deficits, it was *all* interest payments on the debt, not actual deficit-spending-on-programs.

[jdhorner.livejournal.com]

thanks.