Think about the future
Ontario is swimming in debt.
Not only do we as individuals have more debt per person than ever before, but we watch as our governments continue to spend more than they take in.
In the release of the 2018-19 Ontario budget on March 28, Finance Minister Charles Sousa announced the province’s debt would increase to $325 billion. The debt is $290 billion more than it was three decades ago. It has grown from $138.8 billion when Dalton McGuinty took office in 2003.
All the programs and projects the Liberals have introduced this year cost money. And no politician is going to want to announce a tax hike in an election year.
But it’s the nonchalant attitude towards the ballooning debt that is a concern.
If you were to visit the government’s budget website, you would not find debt mentioned at all. You have to dig into the budget documents itself to learn more about it.
The burden of this ballooning debt is on future generations. It is likely “austerity measures” to reduce debt will be implemented. That means programs and grants that have been introduced today could be shrink or cut.
In recent years, when the province borrowed, interest rates were (and still are, relatively) low. However, those in the finance world are raising the alarm about rising rates, meaning more money could be spent on interest payments than on other priorities. Again, this will affect the younger generations.
According to Statistics Canada, Canadians owe $1.71 for every $1 of disposable income. Add on municipal debt, the $22,500 of provincial debt per Ontarian and the $18,000 of federal debt per Canadian, and it gets unsustainable. We can’t get comfortable in this position.
Debt: sometimes it’s okay
Last week the Liberal government released its final provincial budget before the June election.
While it’s filled with items like free childcare, expanding OHIP+ to seniors and a dental plan for those that don’t have a work plan, it’s the deficit that is receiving the biggest outcry.
Yes, $6.7 billion does seem like a scary level of debt to add, but sometimes taking on debt is actually the responsible thing to do.
How would we buy houses without a mortgage in the current market or pay for post-secondary education to become knowledgeable and skilled enough to get a job to pay off both student debt and the mortgage to own a house?
Debt is everywhere, and while it’s intimidating, it can sometimes be a good thing if it’s planned and thought out.
That’s exactly what MPP Liz Sandals says the government is doing.
She explained the Liberal government did the same thing to get Ontario through the 2008 recession and back to a healthy economy.
As a university graduate in 2009 I can attest to the difficult job market. I went back to school and when I was looking at the job market again in 2014, I landed a job as a reporter at the Wellington Advertiser a few months after graduation.
I’d say the government did something right to boost the economy. Now it is trying the same strategy to bridge the gap between high and low income earners.
That sounds like something the government should do.
The overall budget was bigger than just the deficit, but if taking on more debt now means future gains for Ontarians across the province, I say go for it, as long as the process is planned, scheduled and responsibly managed.