Quote:
Originally Posted by SebC
There are problems with aiming for a balanced budget though. First, it's easy to miss the mark, so that if you're not running a surplus you end up running a deficit instead. Second, running a balanced budget in good economic times means you're almost certain to run a deficit in bad times, even without economic stimulus (you'd actually have to hike tax rates / cut services to offset the losses in revenue). Third, if you have debt, and Canada does, you're not doing anything to reduce the servicing costs of those debts.
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I'm not really sure how you came to this conclusion. Debt repayment would be part of the federal budget. Planning to have a surplus simply means that you've got this extra money sitting around, doing nothing. It's not like you budget for a surplus and then pay off some debt. You put the debt repayment in the budget, reducing what would otherwise be a surplus.