The Finance Dept. finally agrees with the PBO: it’s a structural deficit
By Stephen Gordon - Monday, October 8, 2012 - 0 Comments
Canada's Finance Minister Jim Flaherty. (Chris Wattie/Reuters)
The Parliamentary Budget Office has been warning that the federal government has been running a “structural deficit” for several years now, and the Conservative government has been dismissing those warnings for just as long. Interestingly, though, the Department of Finance just came up with a new feature for the 2012 edition of the Fiscal Reference Tables, which were made public on Friday: estimates for the “cyclically-adjusted budget balance.” And they look a lot like the PBO’s estimates.
The idea behind the CABB is that governments should aim to run a balanced budget over the course of the business cycle: surpluses in expansions would offset the deficits incurred during recessions. Balancing the budget in every year would mean that governments would be forced to increase taxes and cut spending in downturns, and to do the opposite when the economy is growing quickly.
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Stephen Gordon’s mission statement
By Stephen Gordon - Tuesday, September 4, 2012 at 10:50 AM - 0 Comments
Maclean’s is the home of some of the sharpest, best-written contributions to the Canadian conversation; I’m glad of the chance to join and chime in.
If you are a regular reader of Macleans.ca, you may have already come across my name. But if not, then here is what you need to know about me: I am an economics professor at l’Université Laval in Quebec City, and I’ve been blogging about economics for almost seven years now, at Worthwhile Canadian Initiative (the blog that I started and has since grown to be a collaboration with other economics professors) and at the Globe and Mail’s Economy Lab.
This is what I wrote in my first blog post:
Canadian academic economists have a low public profile. Offhand, it’s pretty easy to come up with at least three reasons for that:
- We’re Canadian.
- We’re academics.
- We’re economists.
That pretty much adds up to the trifecta in the category of “people whose opinions are not eagerly sought out.”
But I think there’s more to it than that. There are lots of people whose opinion isn’t in any particularly great demand, but who seek the spotlight anyway in order to promote their policy agenda. What’s special about us is that we don’t seem to need to do that. The Canadian economics community is pretty small, so academic and public-sector economists know each other fairly well. Government economists are people we’ve met at conferences, people we’ve gone to graduate school with, or (more and more frequently for me) people we’ve had as students. We don’t need to mount a public relations campaign in order to get a sympathetic hearing at the Department of Finance or the Bank of Canada.
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Kevin Page: the unlikely enforcer
By John Geddes - Tuesday, January 19, 2010 at 4:24 PM - 17 Comments
Meet the PM’s nemesis
Hockey isn’t an obvious decorating theme for a unit of the federal bureaucracy devoted to the non-contact pursuits of economic forecasting and spending analysis. But propped on a windowsill in the office of Kevin Page—the parliamentary budget officer whose reports have repeatedly clashed with the Conservative government’s—is a photo from the movie Slapshot. It’s Paul Newman by a locker-room blackboard, on which the chalk scrawl promises, “We supply everything but guts.” In another photo, Page himself, not a Slapshot extra, displays an ugly blackened bulge where he took a puck beneath his right eye a couple of seasons ago.
He clearly sees himself captaining a scrappy, underdog team. There’s something to that: since Page was appointed the first federal PBO in 2008, his upstart shop of just 13 bureaucrats has taken on the role of an expansion franchise, up against established powerhouses like the Department of Finance and the Prime Minister’s Office, which traditionally dominate the flow of government economic numbers. Page has elbowed his way into their league by releasing contentious studies on, for instance, the cost of the Afghanistan war and, especially, the likely persistence of budget deficits.
