As most of you know, I am 16, and being as crazy as most foolish, fledgling, not-quite-adults, I procured a permit to manipulate a fast moving hunk of metal powered by a internal combustion engine. Also, to prove that I am just as wise as every other teen gangster, I decided to buy a unnecessarily loud, gas-guzzling, excessive sports car. I searched the web and found the perfect one. A Ferrari. Slightly older than the one pictured, but still in great shape, and red, and most important of all, very affordable. $41,000- a steal*. Being thoughtful, I flashed out my checkbook and was about to drive away when a nagging thought came to my mind. I know that I can afford this but, but... “But what?” you ask. You shouldn’t have asked. Here I go. A while back, being the astute business man that I am, I was reviewing the books to make sure that when I did buy the car, I was able to pay for it. I found that I had plenty of money to purchase it and sufficient income to pay for expenses (gas, insurance, repairs, etc). I also checked what the tax would be. From there I looked at the government budget to where the taxes head, and that led me to the debt clocks. I added up my share of the provincial and federal debt, and found that it was just below the price of the Ferrari. Now I know this is odd, and none of you have ever felt this way, but this caused me a moral dilemma. I know that you are all saying ‘’buy the car’’, but I don’t really need this Ferrari and if I could begin to stop the deficit and pay off the debt, I will reduce the economic bondage that my children will live in. The sports car may or may not help find a mother for my kids, and I will probably sell it before any of them get a chance to drive it. So is it right for me to spend my money as I wish, and allow this province and country to continue on the road that Greece and other European nations have taken, where the people have become dependent on the government to care for them, and we all know how well that has gone.
Is that the road that we want to follow: forced to steal from our posterity because we can't pay for it ourselves? It is said that deficits and the debt that follows is not stealing but investing in the future, and I have some major objections to that claim. First, the investments that are made are done with the interests of the current voter in mind. Consider the rapid transit debacle. The voters want bus rapid transit (BRT) as of Oct. 22, 2014 and BRT will be a positive for the city of Winnipeg now. But they won’t pay for it now. They will make the future voter pay for BRT. And for the future voter, BRT will likely be an irrelevant waste of fossil fuel. That voter will want something else. No helping the next generation here. Second, if we are not stealing from the next generation, the things that are built must depreciate very slowly. In other words, the roads must last as long as takes the value of the debt to fall because of inflation. Now how long does a good ole Manitoba road last? Five years, maybe? Bridges take so long to build that some need repair by the time the construction is finished! That is not an investment. That is an expenditure. The concept that we're going to give our kids used junk, call it an investment, and make them pay close, if not more, than the full price for it, is, well... I’ll let you decide.
I think that we may be beyond the point of no return. We have had bad governments spending beyond their means to get re-elected. And have paid the interest with more debt. So, because people have not felt the consequences, they think that deficits are fine.
Now, in spite of my doomsday prediction, the federal government plans to balance the budget just before being replaced by young Mr. Trudeau, and who knows what he'll do. The big problems in money management become daunting when you look at the provinces. Manitoba's debt is $31 billion, and the interest on that is $872 million per year.
To give that some perspective, the infamous PST hike generates $278 million per year. Only 31% of the cost of servicing debt. In the last four years, the cost of interest has gone up $116 million. That leaves $168 million to provide government services and at the current rates of debt, deficit, and interest, in five years, with the much touted infrastructure building one cent in the dollar, we'll all go to banks and bond-holders. And a few more years after that, taxes will go up again so that the government can make the interest payments. The situation is dire, but the people are unconcerned as long as they get away with lining up to get “free” services.
The only way to get off this slope is massive spending cuts, and that will hurt. It will trigger a rise in unemployment and difficulty in the economy. It will mean that individuals and families will have to take responsibility for more of the costs and duties in their lives. Many will complain, “It’s too hard”, but if this generational stealing continues, it may keep our lives easy now, but the inevitable implosion of the government will occur, and that will be far more destructive than cuts to the bureaucracy now.
In a recent smear campaign, Manitoba PC leader Brian Pallister was accused of running with scissors. Scissors that would be used to cut spending, and spending cuts would mean that nurses would be fired and grandmas would die. New teachers would not be hired, and class sizes would become larger, and the kids produced would be so stupid that they could not get a job. And worst of all, spending cuts would allow for the guck in lake Winnipeg to continue to ruin summer. That was the message of the ad. While making those cuts would be commendable, the size of the debt might mean it is too little, too late.
There is only one way to potential salvation. Brian Pallister needs to upgrade to a chainsaw. And if he'll take a chainsaw to overpayment spending, I'll do my part: give up my Ferrari, help pay off the debt, and leave a stronger, freer country to my children. I hope you'll join me.
*Neither the author nor the publisher condone stealing, support activities aiding or abetting stealing or profit from said industry.