As anyone who has ever watched puppies tussle over a bone knows, nothing will lead to acrimony quicker than competition for an object everyone wants. Keep the puppy image in mind. Replace it with provincial governments, many of whom now have a stake in the federal transfer program, equalization.
government spending
The Clerk of the Privy Council's Blueprint 2020 exercise is a positive step in redefining the role and functions of the federal public service in Canada. It asks important questions about how the public service needs to evolve, what best practices it should adopt, and how the federal public service can come to represent a competitive advantage for the country. We laud the Clerk and the entire public service for this introspective initiative.
However, a key question omitted from the blueprint document is: what's the right size and scope of the federal government in 2020?
Another year has come and gone and Ontario's weak public finances remain largely unchanged. The provincial government did little to improve its fiscal position in 2013 and recently signalled it intends to continue with debt-financed spending into the New Year. But the status quo isnt serving Ontarians well. For 2014, the government should chart a new course that places provincial finances on a more sound footing. That would be a much-needed New Year's resolution for Canadas largest province.
If Canadians wonder why little progress has been made in bringing prosperity to First Nations communities, they just received another reminder from an Ottawa-based think tank that reinforces the status quo approach to Aboriginal policy: spend more tax dollars.
In a recent column published in PostMedia papers ('Catching up on Aboriginal services is not cheap,') Brian Lee Crowley of the Macdonald Laurier Institute took issue with and was highly critical of our recent study, which documented a portion of the tax dollars spent on Aboriginal matters.
With the holiday season now behind us, the oncoming flood of credit statements to Canadian households is a powerful reminder that there are no free lunches. Borrowing to pay for current consumption brings interest payments, and ultimately, the need to pay off principal balances. Most Canadians are intimately familiar with this reality when it comes to their household finances. But this same reality also applies to governments. As taxpayers, Canadian families are also responsible for interest on government debt. And these payments are significant.
For many years, Ontario has been the quiet enabler for the vast system of subsidies the federal government provides to Atlantic Canada, Quebec and Manitoba. With rare exceptions, it has stood by as equalization grew and as the federal government incorporated subsidies to regions in more and more of its regular programming.
In recent years, evidence has been accumulating that the regional subsidy system is much bigger than it appears on the surface, unsustainable for both Alberta and Ontario and entirely counterproductive because it discourages growth in all recipient provinces.