Between Lines of Campbell's Speech: A New 'Fudge-It Budget'
He'll have to jigger the books to not show a deficit.
Premier Campbell: New tune.
Clip this column. Or, at least, remember this key point: Gordon Campbell's BC Liberal government is going to foist a "Fudge-It Budget" on British Columbians next February, just before it faces voters in a May provincial general election.
Simply, B.C.'s 2009-10 fiscal plan is going to have a deficit because the government's expenditures will exceed revenues. The Campbell government, however, will say otherwise, claiming instead that their budget is "balanced." That means they are going to have to "fudge" the books to show that revenues exceed expenditures, rather than the other way around.
Preparing to sail the red ink sea
B.C. will not be alone in this sea of red ink. A fiscal contagion is now engulfing governments across North America, hot on the heels of widespread economic dislocation following the global credit crunch.
In the United States, where sizeable deficits have wracked the federal government for most of the past decade, experts believe that a newly-elected president Barack Obama will inherit an annual shortfall of $1 trillion.
State governments also are suffering. Consider California, where governor Arnold Schwarzenegger has recalled the state legislature for an emergency session next month to combat a possible $17 billion deficit.
In Canada, TD Economics last week issued a special report under the headline, "Canada's federal government facing significant deficits." While our country is expected to stay in the black for the remainder of the current fiscal year (2008-09*), it's a much different story over the next two fiscal periods. According to the TD economists, expenditures could exceed revenues by $10.4 billion in 2009-10, and then $9.9 billion in 2010-11.
And just hours before Campbell's televised address to British Columbians, the Ontario finance minister admitted that despite cutting some expenditures and delaying others, his government anticipates the current year will end with a $500 million deficit -- this just months after the legislature passed a balanced budget. He refused to make any forecast for next year.
Premier changes his tune
Let's go back to last night when Campbell made his televised address to the province and admitted that British Columbia is not immune to the financial and economic turmoil now gripping the industrialized world. "World stock markets are reeling, commodity prices are plunging and the world's financial system is under attack," he began, a little breathlessly.
Readers who tend toward the churlish might suggest that this observation shows the premier has made a 180-degree about-face, now accepting that global forces have had, and are having, a significant impact on B.C.'s economic health.
For the last half-decade or so, the BC Liberals have strenuously denied that soaring, world-wide commodity prices, skyrocketing international demand for our natural resources, historically low interest rates and an explosion in federal transfers to provincial governments, had anything at all to do with B.C.'s improved economic circumstances, and succession of budgetary surpluses.
Rather, they crowed that British Columbia's economic and fiscal successes were due exclusively to BC Liberal policies, the courage and foresight of the premier, and the commitment of his dedicated caucus. External forces, whatever they were, were irrelevant.
Well, times have changed, and so too has Campbell's tune.
Ten plus five equals...
To meet this grave situation, which Campbell said was the "worst crisis in over 75 years," the premier outlined a 10-point plan -- which was on top of a five-point program he unveiled earlier in the day in Nanaimo (which proposes meetings with experts, business leaders and other governments).
To start, the legislature will be recalled for a short session to begin on Nov. 20. Six weeks ago, of course, the government cancelled the legislative assembly's scheduled fall sitting because it had nothing to do.
Well, now there is. Legislative approval is needed for tax cuts promised by Campbell, including relief for industry (a school property tax rebate), small business (a reduction in the small-business income tax rate to 2.5 per cent) and individuals (a retroactive cut in personal income tax).
As well, the provincial government will remove limits on deposit-insurance protection for individuals with credit union accounts, and set up a private-sector pension plan for those British Columbians who do not have a group pension scheme.
A technical measure that will be applauded by the private sector is a doubling of the commission Victoria pays to businesses for collecting the sales and hotel taxes. It's a gift estimated to cost the provincial treasury $60 million over a three-year period.
That's seven of the proposals unveiled by Campbell. Another is a gimmick, pure and simple -- Victoria will give the BC Ferry Services $20 million to cover a 33 per cent reduction in fares for December and January.
Why those two months? Well, the premier explained, it will help families get together over the holidays. Then again, the BC Liberals hold only four* of 14 seats on Vancouver Island, and there's this election in May.
One more proposal put forth by Campbell is a pledge to accelerate capital expenditures for infrastructure. This is a neat trick insofar as British Columbia's GAAP accounting allows the cost of capital spending to be spread over many, many years. So, while the BC Liberals get the benefit of having construction jobs created and projects fast-tracked, just a fraction of those expenditures will be counted in the current or subsequent fiscal years.
Define 'avoidable'
Finally -- and this is proof that B.C. will be facing a fiscal shortfall very soon -- Campbell said that his government would re-evaluate spending priorities and reduce "avoidable" government expenditures.
The intent of this measure, the premier said, was to "not start digging ourselves into that hole that we worked so hard to get out of in 2001."
That comment echoed what Campbell told CBC News earlier in the week following an economic summit he and Canada's other premiers attended with the prime minister in Montreal. "It's taken us more than a decade to get out of the deficit holes that were dug," he said.
"And I think we should be building on that because that's the foundation of that financial prudence into the future, not starting to dig another hole. So I am not in favour of deficit financing."
It's possible to detect in Campbell's remarks the sentiment that while he blames the current economic and fiscal uncertainty on "the world," he still credits British Columbia's economic prosperity and fiscal strength to his own government's actions.
But as students of fiscal history know all too well, it is seldom that public finances fall seriously into deficit -- digging a hole, as the premier put it -- because of government over-spending. And that's because government expenditures (absent a war), are generally relatively stable.
On the other hand, government revenues fluctuate considerably. And this is especially true in countries such as Canada, and provinces like British Columbia, which depend to a great extent on the extraction and export of natural resources. Inadvertently, Gordon Campbell himself provided evidence of this in his televised address.
"Today the world's financial system is in the grips of its worst crisis in over 75 years," he said. That takes us back to 1933, the nadir of the Great Depression, which began in 1929 and persisted through the early years of the Second World War.
Did governments around the world face horrendous deficits in the Great Depression because all of them were engaged in out-of-control spending? Hardly.
In the late 1920s and early 1930s, global commodity demand and prices fell off a cliff. Around the world, government revenues dropped off a cliff. Those deficits were caused because, while government expenditures stayed steady -- and, actually, most decreased significantly, to the consternation of John Maynard Keynes -- the monies flowing into public coffers slowed to a trickle.
It was very nearly the same in British Columbia in the early 1980s, as commodity prices plunged and government deficits quickly appeared. The condition persisted in B.C. through to the late 1990s, until the most-recent global commodity boom got underway.
It's revenues, not spending
To appreciate that Victoria's spending is not responsible for B.C.'s worsening fiscal situation, the premier should consult the 2008 edition of the British Columbia Financial and Economic Review, an annual publication published by the finance ministry.
Table A3.6 on page 93 shows historical expenditures by the Consolidated Revenue Fund for every fiscal period from 1984/85 to last year, 2007/08. And for every year but the last four, government expenditures were between 17.1 per cent and 19.7 per cent of the province's GDP.
Then, in 2004/05, the figure fell to 16.6 per cent, and over the next three years was 16.2 per cent, 15.6 per cent and 15.9 per cent.
How, one is tempted to ask, is it possible that Victoria faces fiscal uncertainty when government spending is in decline, and at its lowest point in a quarter-century?
The answer, of course, is on the other side of the fiscal equation -- government revenues.
The monies flowing into the provincial treasury will slow -- and probably have already begun to slow -- as people lose their jobs and businesses see their sales weaken, as commodity prices fall and companies lay off their workers, and as Ottawa tries to get its finances under control by freezing or even slashing federal transfers.
Running in the red?
Still, as was stated earlier, the situation is grave and the premier should be commended for taking action to mitigate the potential impact on British Columbia. But he also is facing an election in six months, and woe be the B.C. premier who seeks a mandate from the voters as red ink drenches the province's books.
Next February, the Campbell government will introduce the fiscal plan for 2009-10. By law, its revenues must exceed its expenditures, but as governments of every political stripe across North America wrestle with gargantuan shortfalls, what is the likelihood that it will be?
Almost impossible, and so let us begin to prepare for a B.C. budget packed with that good, old fudge. But here's something else to consider: what should we do about it?
*Two corrections made at 3:20 p.m. on Oct. 23, 2008.
Related Tyee stories:
- Campbell cuts taxes in BC to fight global economic slowdown
- Taylor's New Recipe for Fudge
Predecessors fudged deficits. She hid a whopping surplus. - Campbell Misled Public on NDP Finances
In 2001 the incoming premier called NDP finances "worse than we anticipated." His briefing binders, gained by The Tyee through an FOI, told him the opposite.
![[Tyee]](http://thetyee.cachefly.net/ui/img/ico_fishie.png){kind=small}
politico
23-10-2008
Digging the hole deeper
It is a remarkable example of revisionist history to claim the NDP dug a hole he had to get out of. Especially when you consider on his first day as Premier he gave his pals on the high end of the income scale a 6 billion dollar tax cut. Guess the hole wasn't that deep....
And too suggest the fix is providing even more tax cuts, faster is so Bush like it is to shudder.
This is electioneering based on fiction.
The NDP should trounce this plan and offer their own, pronto!
politico
23-10-2008
Government in Waiting
Now is the time to start like a Government in Waiting.
You do that by providing a clear alternative while discrediting Gordo's attempt to re brand himself.
This is a target rich environment and the NDP had better start hitting them or they will suffer a loss of seats.
Stop whining, start winning and be a government in waiting.
Luke Skywalker
23-10-2008
Will...
Actually, they hold four - Comox Valley, Nanaimo-Parksville, Oak Bay-Gordon Head, Saanich North and the Islands.
And with the redrawn boundary lines looks like they will likely at least pick-up Saanich South and Vancouver Island North.
That aside, right now there is tooooo much uncertainty. In August we certainly did not know what the situation would be today. Today we don't know what will occur six months from now. Economically, things may just turn around in terms of consumer confidence, maybe, maybe not.
That seems to be the overall consensus.
Vaughn Palmer:
http://www.canada.com/vancouversun/news/story.html?id=2697ac77-af86-42e2-9cb1-e0ad3ebb4981
Norman Spector:
http://tinyurl.com/62du4m
[URL shortened for technical reasons. -moderator.]
Jeffrey J.
23-10-2008
His Royal Highness Speaks
As North America moves further away from democracy, elected officials like Gordon Campbell begin to sound more like rulers and royal vizers. Commandments come from above, dictating to the good burghers of the realm. This latest "speech" from this lacklustre politician underscores this well. Suddenly, Mr. Cambpell, a long time shill for the real estate industry, is an accomplished economist. I wish.
Rather, we see a hodge podge wish list cooked up in record time. Much of the real talent in this regime has left for greener pastures. The thinking is likely to get progressively worse as time wears on. And BC citizens will have to suffer the consequences. Excellent analysis Will McMartin.
Tieleman
23-10-2008
McMartin at his number crunching best!
Thank goodness we have Will McMartin and his calculator at the ready to dispell the nonsense numbers of Gordon Campbell!
Bring on the fudge indeed.
Bill Tieleman
http://billtieleman.blogspot.com/
David Lewis
23-10-2008
interesting discussion
I look around the political arena and I don't see a lot of clearly articulated truth. So I'm not sure about that "key point" you've stressed, i.e. that a "fudge-it budget" is in the cards, and I should be concerned that Cambell is trying to pretend it isn't. What am I supposed to do? Note that and what, only vote for non liars? Where are they?
James was on CBC Daybreak South this morning and she continued on her incessant drumbeat: carbon tax carbon tax carbon tax. The interviewer paused at one point and asked is this it? This is the biggest thing on your mind? I'd add: supposedly the greatest economic tsunami yet faced by our generation is about to emerge from the global economic crisis and strike BC, Campbell's plan seems like a few tweaks, and James is trumpeting get rid of a 3 cent a liter carbon tax.
You seem to think the big problem is what do we do if the BC government runs a deficit. I'd say, what do we do if all the $trillions thrown into the breach by governments worldwide fails to stop what is happening and we find ourselves facing economic collapse? And, I'd say, there is this colossal elephant still in the room: climate change.
I don't see where the US federal deficit is some kind of fiscal contagion. Its a deliberate policy.
There seems to be an unprecedented agreement between economic thinkers as diametrically opposed as Krugman on one hand and Friedman and the Chicago school on the other that an economic apocalypse looms, and taking on a massive more than $1 trillion expansion of US federal government gross liabilities, said by The Economist as almost twice the cost so far of the Iraq War, is the only way out.
It seems to me that policy to deal with this is going to have to be federal, as they have the economic tools. But one of those tools is deficit spending, and it may be that a coordinated massive deficit run by all provinces and the federal government may become necessary. I don't know. What we might debate would be where such spending might be usefully directed to in case it became necessary, because I've never seen such agreement among economists.
I'd say spend on climate policy, build a new electric grid to allow more use of renewables, capture the carbon from all the coal plants and tar sand production, retrofit all Canada's housing aimed at efficient use of energy, renew the transport fleet, rethink our entire way of life, etc. But I realize few believe we face a crisis that would involve such drastic action.
politico
23-10-2008
Reality check
Carole needs to simply lay out the facts.
The 6 Billion dollar tax cut on day one was permanent. So 6 x 7 is 42 billion. 42 billion dollar hole made by GC on day one. No one else is to blame but him.
Next you talk about the subsequent gutting of public services right down to voice-books for blind people. So Campbell and Co looked under every freakin rock to find the 42 billion to send off to the mostly well healed.
Seven years later when deficit financing is an almost certainty, Campbell delivers more of the same. Further fast-tracked tax cuts while "eying spending."
He can only "eye" spending cuz there ain't no more fat to cut. No more holes in the belt to tighten with. He has a lean mean government bustin machine.
And more tax cuts are just a vote buying default election position of the right.
Take the gloves off Carole and just lay out the facts.
alive
23-10-2008
then and now
Interesting how"global forces" are the cause this time around, but not when Glen Clark's government faced a similar downturn?
egmont rapids
23-10-2008
Time to assess the bribe
#1 Restore ferry service that was cut 2 weeks ago--WOW
#2 Reduce ferry fares temporarily to what they were last year--WOW
#3 Credit union deposit were never ever at risk!
#4 5% tax cut is merely carbon tax money collected and returned
#5 A pension plan (volentary) not exactly a quick fix
#6 I heard nothing about "money" for infrastructure--P3s are having big trouble getting financing!
#7 Cut goverment spending (what social programs will get hammered)
#8 small business tax cut and raising of the fees to collect the PST was the only good thing he did/last night
Last night Campbell --Did nothing for --Seniors,students,unemployed,forestry towns,minimum wage earners,crime problem,homelessness,welfare rates--NOTHING
But Campbell did TWO THINGS LAST NIGHT THAT HE HAD NOT INTENDED TO DO!
#1 He proved that he is a bald faced fibster by interfering with the quazi/private corporation known as BC Ferries---BC Ferries and Translink are run by and directed by the Campbell goverment/despite Campbell running away from Translink and Ferry decisions!
#2 This is the big one! Campbell just shouted fire in a crowded theater--Campbell single handidly spooked the already jittery housing market,he spooked companies,investors,he spooked the consumer==Campbell statement/speech/electioneering fear mongering spooked the entire province.
NOW THATS WHAT I CALL LEADERSHIP
Skywalker
23-10-2008
And remember the promise from Campbell that ...
...tax cuts will pay for themselves. That one got the liberals elected. How did that turn out without the benefit of higher commodity prices? Here we are trying the same worn out silly idea with commodity prices falling.
mcdull
23-10-2008
Total bias by the news
Total bias by the news media. I have complained to the CRTC about the chance it was in prime time with no questions and no rebuttal. Just adoration
lynn
23-10-2008
A pinch from the Grinch
"In other measures, Campbell said his government will fund a 33-per-cent temporary reduction in all BC Ferries fares for December and January. He said the government will ensure ferries return to a full sailing schedule."
A "temporary" reduction! (How kind of you Mr. Premier.)
For December and January only?
Wow! The "generosity" and the "long term vision" of this economic plan is IMPRESSIVE. NOT. (Why bless you, Mr. Premier...and your teeny-tiny... and very temporary heart.)
The sheer smallness of this gesture is indeed, UNDERWHELMING.
I mean my heart breaks.
How you have come through for the people of BC once again!
Blessings. Ferries will return to a "full" schedule?
Now you've gone too far in your benevolence, Mr. Premier.
No, no we can't possibly accept this wonderful offering.
It is too much.
Unbelievable.
A "full" schedule, you say? You mean like usual, like we had just weeks ago? Before it was so rudely... and undemocratically DECLARED that it would be taken away.
hmmm....funny, you didn't say anything then.
Oh I get it.....
ferry runs are giveth
and then
ferry runs are taketh away ...
and then
ferry runs are giveth back...
before the election.
and then
after the election...
all things are taketh away ...
and all bets are off....
jimmy_laroux
23-10-2008
Capital expenditures for infrastructure
Will McMartin:
Don't forget P3s/PFIs, new phenomena in BC, which allow the government to move debt off the books and rename it "contractual obligations" instead. Billions of dollars of infrastructure debt is hidden in this way.
jimmy_laroux
23-10-2008
alive
alive:
Indeed. Rafe Mair pointed that out in this article:
http://thetyee.ca/Views/2008/10/13/WallStreet/
Luke Skywalker
23-10-2008
Jimmy...
Not as simple as that.
For some of the following reasons and tidbits from BC Public Accounts:
And of course "deferred revenue" increased:
2006/07: $5,989 billion
2007/08: $7,136 billion
"Deferred Revenue" meaning "cash in the bank account" that must be accounted for (GAAP) over a 5 to 10 year period based upon the duration of natural gas tenures, in part.
That "Deferred Revenue", in part due to bonus bids for oil and gas tenures, will again substantially grow again this year based upon the ~$2.1 billion in bonus bids received to date. (for calendar year 2008 although mostly incurred during the 2008 fiscal year)
BTW, all signed off by Auditor-General Doyle.
Ya better report any "hanky panky" to the Auditor-General or to the credit rating agencies, if ya think otherwise.
jimmy_laroux
23-10-2008
Great article!
Will McMartin,
Excellent article!
Luke Skywalker
23-10-2008
And What Do The People OF BC Think???
Of the government's 10-point plan from yesterday?
Ipsos Poll (Global BC)
Approve - 72%
Disapprove - 21%
Effective - 59%
Not Effective - 34%
Skywalker
23-10-2008
Oh Luke.
The liberal spin machine must really be working overtime. It all sounds so desperate Luke. This playing with the numbers. A poll which comes out before most people on the street even know the details. Asking them to make a judgement on a few things they may have picked up. Well my friend go for it. What I hear is that Campbell isn't fooling anyone. Only the absolute die-hard liberal believes anything he says.
So let me ask again Luke, what was the decision of the Judge in the case that made the claim that a Glen Clark budget was fudged.
jimmy_laroux
23-10-2008
Surplus, surplus, surplus...
Luke Skywalker:
:) Yes, it is, but as it makes the BC Liberals look bad, I don't imagine you would admit this.
http://www.fin.gov.bc.ca/OCG/pa/07_08/PublicAccounts.pdf
Note the word "borrowed" used here. Not my words, by the way, those of the BC Ministry of Finance.
As though BC taxpayers are not liable in the end for BC crown corporations...
According to the Ministry of Finance total debt is "the most commonly used measure of debt." But anyway, if you think total debt is so unimportant, why do you bring it up when denouncing the Evil NDP?
As in money BC will make but hasn't yet. So, um... how is this relevant? To last year's Public Accounts?
G West
23-10-2008
On the subject of Campbell's little speech
Anyone who thinks Campbell is more than a bad used car salesman trying to get the customer to buy a tarted up bimmer with sawdust in the transmission ought to read this, from Paul Willcocks, before thinking that poll result 'means' anything.
The Bureau was burning the midnight oil and Jessica was on the horn woth Gordo for a couple days working out all the details.
Get with the program dudes!
http://willcocks.blogspot.com/2008/10/less-than-meets-eye-to-campbells-big.html
leftofcentre
23-10-2008
The byelections are irrelevant
The byelections will be lucky if they get 40% turnout, considering the circumstances (feds & municipals taking the limelight).
There's nothing to be built on for any party in the byelections (unless the Greens win one)
egmont rapids
24-10-2008
This is a must read story
By far this link to harvey Oberfeld --His story is the best peice of truth telling by any MSM I have seen or read in years!
My hats off to Mr. Oberfeld
http://harveyoberfeld.ca/blog/?p=111
zalm
24-10-2008
Leftofcentre
"Look, I'm a left-of-centre guy like a lot of people here. But even with my university economics courses, I know that governments either choose to live within their means or they don't. The Tories in Ottawa and the Liberals in Ontario are committing political suicide by running deficits."
I dunno, I think you should go back and re-read Keynes again. There's no suicide in evening out the swings and vagaries of political economy. Our governments may lack discipline, but hey, everybody makes a mistake or two the first time out. Let's check in a hundred years.
Bailey
24-10-2008
the fudge is done
As soon as they were elected, the Liberals enacted some draconian changes in the way the books are kept.
As well as, as someone above noticed, the forward averaging of debt scheme that allows debt to be declared at a small fraction of it's value by utilizing a front by way of P3, they also have ceased to account for highways or ferries by pretending third parties own them in a similar way.
Even though we still pay all the bills plus extra fees, we never get to see those bills anymore, do we?
Hydro too, to a lesser extent, seems to be being kept off the public books.
It's hardly necessary for Campbell or anyone else to fudge the budget while they keep the books like this. Hard indeed to show anything BUT a huge surplus when all your expenses are hidden, except those minor items you think don't matter.
DPL
24-10-2008
My goodness, a possible 60
My goodness, a possible 60 dollar a year tax cut. How exciting. A couple of weeks ago I was sent with a prescription to Queen Alexanders a place run by VIHA for two braces to aid my recovery from spinal surgery, Just before leaving the place I was told the price was 750 per brace. How did I intend to pay? My big tax cut will take a lot of years to recover the cost of those things. Rave on Gordo fans. Bottom line is, many things like physio, massage and some other services are no longer even partially covered by Gordo's health management teams. The deductable for our family for precription drugs went from 200 bucks to around 1500.There are two people in our immediate family King Gordo is really a saint as he helps us along. Just watch when he moves his lips, you will know he is spinning the issues.
switek
24-10-2008
Gordo's setting the stage
To me this was just classic Campbell setting the stage for the upcoming election.
He says he wants to “accelerate” some major infrastructure programs to stimulate the economy. Translation ? What he really means is that he will push his pet projects forward; and after all there is an election coming right?
He next says he will have to “re-evaluate” spending. Translation? What he really means is that the projects for political reasons he does not want to do; he will simply say we cannot afford them.
Next thing you hear is a bunch of talk about the Port Mann Bridge from Falcon. Carole James opposes the Port Mann project and there just so happens to be some fresh new seats over in Surrey. Anyone else see the pattern here ?
I think Campbell just laid down the template to selectively actually make that politically move money (aka mega projects) around BC wherever Campbell sees fit. I’ll be curious where the projects end up in relation to all those new seats up for grabs.
Carole James meanwhile continues to look like a deer in the headlights. How much longer can she continue to criticize Gordo and yet promise she won’t change any of his policy ? It’s just like the nonsense opposing the carbon tax but promising that she will keep the tax cuts. What kind of drugs is she on ? How do you criticize tax cuts but then promise you will not raise taxes ? I predict she will suffer a similar fate to Dion. We need Corky.
Bobby Peru
25-10-2008
Nice try at baking Fudge
I was wondering when Tyee would recycle the NDP's fudge it budget into the Liberal version. But, if you care to recall the history, the NDP, under Glenn Clark, (which I don't see many of you BC leftists defending- come on I thought he was one of you) engaged in such reckless spending through the 90s and their term that they simply had to play with the accounting. And don't forget all this occurred in the middle of a strong North American stock market and economy. Relatively speaking, the NDP made BC perform terribly.
Now the Liberals can afford some deficit spending because they racked up surpluses and reduced the NDP's deficit over the years. In fact, it's this kind of uncertain economy which govts should prepare for.
I can see on these postings there's an avalanche of hatred for the Liberals and Campbell- hatred at why avg voters don't hate them as much and why avg working people can't understand that the NDP is the better alternative. The NDP ought to get some policies worth supporting and elect a leader that can capture the public imagination. Someone who is more of a technocrat than a firebrand leftist who runs the same old tired play book fermenting class warfare.
happy
25-10-2008
I don't think Corky would take the job
Rafe Mair Online May 2005
Current NDP member Corky Evans summarized the dwindling days of the NDP quite well in this quote: “In our hysteria to deal with the recession we tried to bribe capital into saving us – but it didn’t work. It didn’t work with aluminium smelters. It didn’t work with the jobs and timber accord. It didn’t work with the fast ferries that we thought we could sell to the world. It didn’t work with the amusement park on Burns Bog. It didn’t work with the trade and convention centre in Vancouver. It hasn’t turned a single wheel yet.”
I forgot about that amusement park in Burns Bog... :)
Fiat lux
25-10-2008
Keynes worked under and with
Keynes worked under and with the gold standards, when the money supply was strictly limited and enforced.
With bank deregulation money creation became a criminal racket, used to take over control of the world's economy by an oligopoly of bona fide crooks, who now can account their thievery as "earnings" and get away with it.
In short, whatever the old prophets of economics have written and said 70 or 200 years ago has absolutely no use, or context in the present age and situation.
What these crooks have done was to copy the precedent set by Hitler's financial genius Hjalmar Schacht, who created a booming German economy with imaginary, fiat money, in an Europe still suffering at the bottom of a a great depression.
Many countries have refused to accept Deutschmarks at the time, but now, encouraged by their miseducated and brainwashed economists, Harper being one of them, they all are hooked on this imaginary money creation racket that gave their citizens the power to spend recklessly and into debt slavery and some corporations to buy total control .
I'm not in favour of the gold standards, but fiat money creation should be returned to and under strict public control and governments must inform and educate the public that there are limits.
When the banks were deregulated, I made the following definition: "With bank deregulation money has become a licence for energy control issued by a special interest class for its own benefit"
This can not be permitted to go on, because there's a good chance that the present crash has been planned by the major players for a long time to force humanity into a depression and to beg for a global corporate dictatorship, with the NAFTA and the EU being the first steps.
Ed Deak. Big Lake.
RickW
25-10-2008
Robbins
I'm asking--is there any hope--or have we moved to nothing works and "who gives a shit"?
No matter who I talk to, down here at the bottom of the foodchain, virtually ALL believe this (and all other) so-called "crises" are contrived and/or manipulated by "them" (fill in who you prefer), and that explanations from the likes of Finance Minister Flaherty (as well as Hanson) invariably involve the invocation of the "trickle down theory", which means those at the bottom get it in the neck, no matter how "sound the fundamentals are".
And so, we don't believe them (but we're not at that stage yet where we take to the streets with pitchforks and torches).
realisticman
26-10-2008
Dan Miller
The push for oil and gas is pragmatic and compassionate.
As Dan Miller points out, the lumber industry in BC was a $16 billion operation that helped build BC with the health, education and social programmes that are in place today.
Now that the US market for BC lumber products has declined so dramatically another base for the lost income has to established if BC expects to maintain the social services at previous levels.
Oil and gas will be in demand for some time to come even if alternatives gradually come into play. This is where BC can find the necessary funds to maintain the standard of living that BC enjoys.
Bobby Peru
26-10-2008
The end of ideas
I know many of you can't make heads or tails of recent economic events and the political outcome in the Federal election. Many instinctively want to return to a system of self-sufficiency, of preserving our natural resources for our own use, much like you encourage individual households to grow their own vegetable gardens or put up roof solar panels.
No matter how romantic this notion- 'put up the walls to economic threats like China and the US' ; stop the world I want to get off", the fact is that we are stronger as a world operating in an interconnected group of societies. And the isolationist response that you largely propose will bring on a huge drop in the standard of living around the world. Even if you could stop Chinese made goods (like lumber products- I'll get to this later) from entering the BC or any other outside economy, you would only impoverish millions of Chinese who have lifted themselves out of poverty through factory work.
Don't care about impoverishing foreign workers? Well that drop in standard of living will make its impact felt in Canada in this global system of ours.
Now I've heard lots of criticism about capitalism here, but I haven't seen any proposal and details about the system to replace it.
The sad fact about the BC lumber industry is that it's only capable of exporting raw logs because BC labour rates are much too high to be competitive with, let's say, China. It makes more sense for Chinese factories to buy BC plant and machinery and use cheaper Chinese workers to make low value added lumber goods.
Another way to put it is that it's foolish to long for those high paying, low skilled lumber and forestry jobs in BC. It's like longing for the return of a cancelled TV series. The products you used to make are not being made by other people at a much cheaper price. It doesn't make sense to erect trade barriers and force BC consumers to pay more for goods that can be produced much cheaper and better by others. Time to move on to new industries.
Like offshore oil production in BC. I am perplexed at why no one hasn't rolled over the irrational objections to exploring for oil. After all, no one knows how much oil and gas is down there unless you explore.
Luke Skywalker
26-10-2008
Dan Miller...
I recall, prior to the 1996 provincial election, a Vancouver Island First Nations chief telling me that Dan Miller "is a good businessman". That's stuck in my head ever since.
Dan Miller was also responsible for the oil and gas industry credits in the late 1990's, which resulted in the expansion of the north east industry.
And again he has hit the nail on the head in terms of the economic and financial potential of offshore oil and gas. IMHO, it's longer term. Then there are the Nechako and Bowser basins in central BC.
http://tinyurl.com/68opeg
[URL replaced with shorter version for technical reasons. -moderator.]
Of course, northeast BC is booming economically and is also providing $billions annually into provincial coffers.
Newfoundland/Labrador has always been the basket case of the Canadian economy, the poor cousin of Confederation.
Yet last year it recorded Canada's highest growth rate at ~5.7% and has a projected surplus of $544 million in it's 2008 budget that trims taxes, boosts education and health care spending while paying down some of its whopping debt.
Nfld. is also on the verge of becoming a "have province".
Why??? Offshore oil and gas. Nothing else.
Imagine what BC could do with the extra $billions flowing into its coffers every year.
Imagine no health care premiums, no 7% PST, and $billions more for health, education, social services, and infrastructure.
That about sums it up IMHO.
But then again, I don't see any Dan Millers in the current NDP caucus.
Skywalker
26-10-2008
Good one Luke.
Here's one that had me chuckling. "Dan Miller was also responsible for the oil and gas industry credits in the late 1990's, which resulted in the expansion of the north east industry." Now ever since Dan left I have been hearing Campbell take credit for all this stuff. You gotta be more carefull Luke.