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February 03, 2010
Canada Federal Debt Per Capita
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---- The entry has a very long and appropriately named title, but I'll just call it throwing up at the US federal budget. What I found interesting about it was that if you take their words out of context, it sounds just like they are talking about Canada:
This is the best that the brightest economic minds in our administration can do. Think about that. The most thoughtful, determined, experienced members of our leading economic team cannot come up with a budget proposal that is balanced, near balanced, thinks about being balanced, or has any chance of coming close to balanced for the foreseeable future.
As I've said before it does us no good to point our finger and say how much better off we are, because truthfully we aren't. If you take a look at the federal debt per capita, here's how we stack up:
These numbers a constantly changing, so this article is out of date as of the minute I write it, but they're roughly correct. Again, I am only referring to federal debt. Provincial, municipal and personal debt is not taken into account here, so if you look online you will absolutely be able to locate figures that directly contradict the above. I'm truthfully not interested in them, I don't want to get into net personal debt, I don't care to look at provincial economics. Just to save you the effort of correcting me, here is a link to the article most will find and desire to send to me: http://en.wikipedia.org/wiki/List_of_countries_by_external_debt. The CIA World Factbook calculates what they call "external debt", which is something different than the federal debt I'm talking about. External debt is strongly tied into the percentage of foreign holdings (and I've tried to find the details on their method of calculation, but cannot). Again, I'm looking at federal debt only. The important point is the order of magnitude of the numbers, not the specifics. If you look at the numbers for federal debt between Canada and USA, on the face it looks like we have more than an order of magnitude less debt than our neighbours to the south. This is not true if you take population into account. Per capita we're not that much different than them. Each and every person in Canada is responsible for about one third (or two thirds, if you prefer the CIA's numbers) the amount of federal debt as someone living in the United States. That's really very similar. How can we possibly pay down our federal debt? How long will it take me, for example, to contribute an EXTRA $13,000 in taxes, over and above what I am already paying? I suppose if the federal government raised our taxes it could feasibly be done within a few years, but you know this isn't happening. Not only are they not raising taxes, they have lowered them because they want our votes. They want to be able to tell us that they care about our own personal financial situations and therefore they have reduced the burden of taxes on us. What they fail to remind us is that while we don't pay down our federal debt, we actually end up worse off in the long run, owing more and spending more on servicing our debt rather than in receiving back real program benefits for each tax dollar we send them. Posted by Hammer at February 3, 2010 01:01 PM |
There is an interesting blog entry over at HS Dent again that talks about the proposed federal budget for the United States...If you enjoyed this article, you may want to read more in the Finance category.
Comments
if i pay $13643 per person in my household can i claim as a tax free person. no tax after that?
I agree some will be needed to keep up some business within government, can there be a revised tax for people that do and don't
@Joe: our federal debt ISN'T declining at the moment
Since our total debt is declining, you are currently overpaying what is required for the Federal Governments day to day operating expenses. These include the gov't of the day, Federal employees, foreign representatives like ambassadors, CPP, health care, EI, etc. Federal debt goes up when gov't spending gets out of hand. Federal debt goes down when they find ways to cut expenses.
$13,000 federal per capita debt - had the GST been applied COMPLETELY to the debt - as first proposed - we would have no federal debt today.
Before adding more water - it is imperative that we repair the HOLES in the bucket - too much is draining out - basically - the bucket is more of a sieve...
Mulroney did have a responsible plan - however it was unpopular with voters - the subsequent governments - did not abolish this unpopular plan - they did MORE harm by wasting and pilfering the money that came in...
Yes, they paid down some debt, however they also passed many taxes and costs onto teh provinces, and the municipalities. So they talked as if they were reducing our deficit - but it was a shell game - even more money came out of ONE pocket - the taxpayer - you and me...
A correction is imminent - unless people accept that we need to reign in our demands for services that are not basic in nature
It's not just the federal debt. Provincial and municipal debts matter too. I wonder how we'd fair vs. the US if all that (their state and municipal debts vs. our provincial and municipal debts) were taken into account.
I'd say the bigger problem though, for the US, isn't debt, but the huge looming liabilities coming up in the years ahead.