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chemgear · 11-21-2023, 11:21 AM

https://twitter.com/user/status/1725295181124325585

https://thehub.ca/2023-11-16/trevor-...campaign=boost

Canada’s finance minister, Chrystia Freeland, will provide a fiscal update next Tuesday. It will not be pretty.

In fact, the monthly interest costs of the federal government are now at an all-time high. The latest available data for August shows federal interest costs exceeded $4.3 billion, surpassing the previous record of $4.03 billion set in December 1995. It’s more than double the pre-COVID amounts, as I illustrate below. And it’s the fastest acceleration in interest costs in recorded history.

And if rates stay higher for longer, as many (including the Bank of Canada) now expect, the government’s debt levels may not be sustainable.

Federal debt that grows faster than the economy is not sustainable. If the fiscal update shows that, alarm bells should ring.

What can Canada do? As I’ve noted before, sticking with the government’s own previous plans would be a good start. Ratcheting up spending plans with every single budget is an important reason why we’re in this situation. Looking ahead, those seeking to replace the current prime minister—whether within the Liberal Party or Pierre Poilievre of the Conservatives—should start considering options.

11-21-2023, 11:21 AM	#10179
chemgear Franchise Player Join Date: Feb 2010 Exp:	https://twitter.com/user/status/1725295181124325585 https://thehub.ca/2023-11-16/trevor-...campaign=boost Canada’s finance minister, Chrystia Freeland, will provide a fiscal update next Tuesday. It will not be pretty. In fact, the monthly interest costs of the federal government are now at an all-time high. The latest available data for August shows federal interest costs exceeded $4.3 billion, surpassing the previous record of $4.03 billion set in December 1995. It’s more than double the pre-COVID amounts, as I illustrate below. And it’s the fastest acceleration in interest costs in recorded history. And if rates stay higher for longer, as many (including the Bank of Canada) now expect, the government’s debt levels may not be sustainable. Federal debt that grows faster than the economy is not sustainable. If the fiscal update shows that, alarm bells should ring. What can Canada do? As I’ve noted before, sticking with the government’s own previous plans would be a good start. Ratcheting up spending plans with every single budget is an important reason why we’re in this situation. Looking ahead, those seeking to replace the current prime minister—whether within the Liberal Party or Pierre Poilievre of the Conservatives—should start considering options.