Flaherty promises new tax relief, pledges to eliminate federal debt

[jolinar of malkshor]

Paying off the debt by 2022 is a lofty goal. If they can do it, that would be great for everyone one of us.

The Conservative government is promising $22 billion in new personal tax relief for Canadians and will eliminate Canada's $480 billion debt by 2021, Finance Minister Jim Flaherty said Thursday

http://www.cbc.ca/money/story/2006/1...conupdate.html

[Robbob]

It sounds good but just talk before the next party comes in and fudges things up.

[Cube Inmate]

Any idea what fraction of our debt is accounted for in Canada Savings Bonds?

edit: $19.2 Billion as of April 1 2006, according to CBC.ca. 4% of the total.

[Phaneuf3]

that's why we have to keep the conservatives in with a majority government until at least 2022.

[Looger]

since the war, i'm not aware of any country paying off its debt, i really doubt it could ever be in the cards.

debt financing is what keeps this whole corrupt gong show on its feet, the private reserves lending money and creating currency forever. nothing at all to back it up.

what's funny is that before trudeau's government we were paying it off, the war debt i mean.

i fear that once the international banking cartel gets its hooks in, that is the carte blanche to lend and lend, that the deal is they can keep milking this debt forever.

the US government in fact borrows its whole budget, and uses tax money to pay the interest and not much else.

not sure EXACTLY how it goes in canada, though i know that since the 50s we've abandoned fractional reserve - at last count 13-1 - and now the reserve lends unlimited regardless of reserve size.

this all of course is a ridiculous house of cards.

[jolinar of malkshor]

Well....in the last 10 years or so we have reduced the Canadian National debt to about 490 billion from 545 Billion saving us tax payers almost 10 billion in interest so far. We currently spend 34 billion a year to service our debt. Can you imagine how much we can reduce our taxes if we get rid of this thing?

[Cube Inmate]

Originally Posted by Looger

...
debt financing is what keeps this whole corrupt gong show on its feet, the private reserves lending money and creating currency forever. nothing at all to back it up.

...

not sure EXACTLY how it goes in canada, though i know that since the 50s we've abandoned fractional reserve - at last count 13-1 - and now the reserve lends unlimited regardless of reserve size.

this all of course is a ridiculous house of cards.

How do you foresee the "house of cards" collapsing?

[MarchHare]

The Conservative government is promising $22 billion in new personal tax relief for Canadians and will eliminate Canada's $480 billion debt by 2021, Finance Minister Jim Flaherty said Thursday

If, rather giving us $22 billion in tax cuts they instead ear-marked all of that $22 billion towards debt repayment, how much sooner would the country be out of debt?

Also, if they're cutting taxes, where is the money for the debt repayment going to come from? What programs are going to lose funding in order to pay for this?

[jolinar of malkshor]

Originally Posted by MarchHare

If, rather giving us $22 billion in tax cuts they instead ear-marked all of that $22 billion towards debt repayment, how much sooner would the country be out of debt?

Also, if they're cutting taxes, where is the money for the debt repayment going to come from? What programs are going to lose funding in order to pay for this?

I haven't see the numbers, but maybe there is enough to do both. We are looking at a 5 billion dollar surplus this year alone. then you have to factor in the amount we save every year on interest if we pay down the debt. The more we pay, the more we have left over for the next year. The more we pay on the debt.....the more we end up having left over to pay on the debt.

[Cowperson]

A list of countries and how their debt compares to each other relative to their Gross Domestic Product:

http://www.answers.com/topic/list-of...by-public-debt

You can see how Canada and the USA compare to their peers. A low number is good.

Although I think that government deficits matter, there is an ongoing conversation about that very topic, with some economists saying deficits do not matter:

http://money.cnn.com/2004/02/02/news...dget/index.htm

Cowperson

[Lurch]

The way I heard it, it was net debt they plan to retire - I'm 100% sure that article is misleading. I'm not sure what Gov't assets amount to, but I imagine the headline is a whole lot more impressive than what the actual debt reduction amounts to. Just looking at their #'s, they are saying $3 to $4 billion per year against the debt for the next 5 years. That leaves something like $460 billion in debt in 2011. If the Conservatives meant total debt, that implies $46 billion surpluses on average from 2012 through 2021.

[MarchHare]

Originally Posted by jolinar of malkshor

I haven't see the numbers, but maybe there is enough to do both. We are looking at a 5 billion dollar surplus this year alone. then you have to factor in the amount we save every year on interest if we pay down the debt. The more we pay, the more we have left over for the next year. The more we pay on the debt.....the more we end up having left over to pay on the debt.

I agree with your last two sentences completely. I think debt repayment in our long-term best interest, which is why I think a $22 billion tax cut could be better used by agressively paying off the debt faster.

While I may be (by the standards of this forum, at least) a liberal extremist when it comes to social issues, I'm very much a fiscal conservative. $22 billion over six years sounds like a lot of money, but in reality the average Canadian taxpayer will probably only keep a few extra hundred per year; certainly not enough to change anyone's spending habits or make any kind of lifestyle change. Using that tax break money to instead pay down the debt at an accelerated rate will have long-term benefits for all Canadians.

[Cube Inmate]

March: for the past several years, the government has put up repeated surpluses all while increasing program spending beyond the rate of growth of the economy. According to the government's last budget (admittedly biased), program spending increased from about 12.1% of GDP to 13.6% from 2000/01 to 2004/05.

I haven't run the numbers, but perhaps this level of tax cut can be accomplished without cutting, but rather by just stemming the growth!

[Calgaryborn]

It's interesting that we have a greater debt load than the States even with their investment in war .

[jharp]

Originally Posted by Phaneuf3

that's why we have to keep the conservatives in with a majority government until at least 2022.

in principle that would be fantastic, but any party in power that long...looses its edge (see current AB gov't).

[Lurch]

Originally Posted by Calgaryborn

It's interesting that we have a greater debt load than the States even with their investment in war .

I suspect 2005 will be the last year this holds true - we are moving in two dramatically different directions.

[Robbob]

Originally Posted by MarchHare

I agree with your last two sentences completely. I think debt repayment in our long-term best interest, which is why I think a $22 billion tax cut could be better used by agressively paying off the debt faster.

While I may be (by the standards of this forum, at least) a liberal extremist when it comes to social issues, I'm very much a fiscal conservative. $22 billion over six years sounds like a lot of money, but in reality the average Canadian taxpayer will probably only keep a few extra hundred per year; certainly not enough to change anyone's spending habits or make any kind of lifestyle change. Using that tax break money to instead pay down the debt at an accelerated rate will have long-term benefits for all Canadians.

The guys in Ottawa also know that the people in this country don't like when you just take away without giving in return. Most people fail to see the big picture. I also think that you can look at Alberta as an example. Yes the government got rid of the debt but people don't like how they got there. By the government throwing a bone it will keep the population happy. It will take longer but you need to keep people happy or you will find yourself out of office rather quickly.

[jharp]

Originally Posted by Calgaryborn

It's interesting that we have a greater debt load than the States even with their investment in war .

is that based on a per capita level?

[jolinar of malkshor]

Originally Posted by Lurch

I suspect 2005 will be the last year this holds true - we are moving in two dramatically different directions.

What?? They got rid of the debt. But I would agree that they have no vision currently.

[jolinar of malkshor]

Originally Posted by Calgaryborn

It's interesting that we have a greater debt load than the States even with their investment in war .

If you look at it, they have a more populus country in a smaller area that is mostly in easly accessable areas. Canada has a 1/10 the population spread out over a much larger area, making it a lot more expensive to run.

I wonder what is going to happen when people in the US are going to have to pay tax rates like we do. There will be a revolt.