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Pique N' Your Interest

Our attention to the deficit disorder

As provincial and federal governments fight over taxes and jurisdiction, and funding for health care, education, and everything else I wonder how many Canadians realize that their country is dumping more than $35.4 billion down a black hole each and every year.

That’s more than 23 times the amount of money the Canadian Student Loans Program lends out annually to more than 300,000 students. Even a fraction of the money we waste could reduce tuition fees and make post-secondary school more affordable and accessible to all Canadians.

That lost $35.4 billion is almost three times what we spend on our military annually, not counting special programs like the planned purchase of 29 new maritime helicopters to replace our decrepit fleet of Sea Kings. We could have more than 700 new helicopters every year with the money we waste – not that we need to, I’m just saying.

Everyone talks about the health care crisis in Canada, with our overworked doctors, our poorly served rural areas, and our critical lack of funding for facilities, staffing and new equipment.

If the average doctor makes $150,000 a year, we could hire 10,000 more physicians for less than a twentieth of $35.4 billion. We could hire 20,000 more nurses for another twentieth of the cash, and build five more 300-bed hospitals and purchase more than 750 MRI, CT and X-Ray machines with two more twentieths. Increased capital costs and general staffing could cost another few billion, so, rounding up and estimating, we could almost completely solve Canada’s health care crisis for about a quarter of the cash that disappears from our national coffers every year.

Some people are concerned with the level of taxation in this country, so what if we gave a third of our lost money back to the wage earners in this country in a progressive way that gives the biggest cuts to middle and low income earners?

Our total labour force has about 12 million full-time people, according to 2003 tax rolls, which means on average Canadians could see themselves paying almost a thousand dollars less in taxes each year.

And the government would still have a surplus of more than $23 billion to spend on health care, education, the environment, the military, and all kinds of useful programs. If we were smart we would plop down a couple of billion on infrastructure, trickle down a few billion to pay off provincial debts, and could still put away a few billion each year for emergencies like ice storms, firestorms and Haitian coups.

No, I’m not an economist, or any kind of math wiz. I wouldn’t stake my reputation or my career on any of the figures I’ve mentioned above. I got most of the numbers I used off the Internet, and guess-timated the rest, rounding up and down a few hundred million here and there.

My mathematical meandering is not what’s important, however. What’s important is that the $35.4 billion figure is accurate – it comes straight from the horse’s mouth via the latest federal budget.

Every one of those $35.4 billion will go to pay the interest on our national debt of $510.6 billion.

Our $35.4 billion debt payment is roughly 21 per cent of all the money that Canada generated in federal revenues last year. To put that another way, one dollar out of every five we pay in taxes goes nowhere.

Prime Minister Paul Martin did hold almost $2 billion back in his budget in case of emergencies and whatever’s left over will go towards our national debt at the end of March 2005.

As always, social activists, the health care industry, educators, unions and NDP leaders were critical of Martin’s budget. They would spend every penny of the $1.9 billion held in reserve if they could, which in all fairness would probably do a lot of good for disadvantaged Canadians.

But what nobody seems to understand is that this is how things have to be. Debt isn’t some kind of abstract concept or secondary issue, it’s very, very real. Every cent of it will have to be paid back, which means one generation’s excesses become another generation’s problem. Debt is the 800 pound gorilla we let loose on future generations if we choose to pass it on.

Canada has posted balanced federal budgets for the last seven years and has paid down an impressive $52 billion of our national debt in that time. Our annual interest payments have decreased by more than $3 billion.

But we’re still in a deep hole here.

As a Whistler resident for five years and a university student for four, I know a little something about being in debt. It sucks. Debt is a personal black hole that consumes everything and blocks out the light.

More than 500 bucks of my disposable income goes towards my own personal debt each and every month. I have no savings, no investments, just the unused credit on my cards.

The thing that sucks the most about debt, aside from the money I lose to pay interest, is that you can’t just shrug it away. Life does not go on as usual. In fact, life doesn’t go anywhere at all because my debts will ultimately decide whether or not I qualify for a mortgage or a car loan, and how often I can fly home to visit with my family.

You have to scale back ever facet of your life to pay back debt. If you spend too much one year, you have to cut that amount – plus interest! – the next year just to get back to even. You stay home when you want to go out. You brown bag your lunches. You clip coupons and wait for things to go on sale. Every wedding, every Christmas, and every vacation is a setback.

It’s time for Canada to face up to our debt, and for critics to stop pretending everything is normal and finally face up to our debt. It’s time for desperate measures. We should temporarily increase our taxes, add a point or two to the GST, cut spending anywhere possible, and pinch every friggin penny – no more sponsorship scandals, no more ill-conceived human resource plans, no more gun registry nonsense.

Why now you ask? Why not chip away like we have been the past seven years if our GDP is growing and our debt is slowly shrinking?

Because debt is literally killing us. The $35.4 billion we are literally throwing down the shitter this year could fix everything that’s broken in this country and we’d have enough left over to cut taxes for everybody.

I know I’ll breathe a lot easier when I’m out of my few thousand in personal debt. Think how good it will feel to shed $510 billion.