Deficit spending is like a dog chasing its tail

By MPP Toby Barrett

It is possible for all of us to once again have a vibrant and expanding private sector and a civil service that is a model for excellence. All we need is a government with vision, a clear plan and the willingness to make the tough decisions to get us there.

For starters, we must begin to lift the burden of deficit and debt that is holding Ontario back. That means paring back the size of government to allow growth to catch up to spending and bring the province’s books into balance.

Simple arithmetic tells us government can’t eliminate its deficit if it keeps spending all the new money it takes in. This approach to budgeting is like a dog chasing its tail, but at least the dog keeps up with the tail.

Even this year, after four consecutive years of historic budget shortfalls, the current government continued to introduce hundreds of millions of dollars’ worth of new programs despite having to borrow money to pay for them.

This has to stop.

Three numbers tell us that the need to act is urgent. The first is $14.4 billion. That’s the difference between what the provincial government is spending this year and what it is taking in. The second number is $260 billion. That’s how much accumulated debt Ontario has placed on taxpayers, half of that in the last nine years alone. When independent economist Don Drummond examined the province’s books last February, he predicted this debt figure would increase to $411.4 billion over the next five years.

Decisions that need to be made have to be part of a comprehensive and integrated plan. As Drummond recommends, the government should create a formal document outlining its vision and path toward a balanced budget, as Prime Minister Brian Mulroney did in 1984 and Prime Minister Jean Chrétien did in 1994.

It’s time for a new attitude toward government. We don’t undervalue the importance of government, but don’t measure its success merely by the number of employees, the amount of money spent or the number of programs delivered.

Prosperity for Ontario requires solid private sector growth and job creation,
combined with a significant restructuring of government to get it refocused on its core tasks. Ontario will succeed when both the private sector and government are doing their jobs well.

This will require getting government out of business where it doesn’t belong. For example, when too many Ontarians are waiting to get vital health care services, do we really need a government agency borrowing money to offer online gambling to compete with PokerStars?

Basically, government has no business being in business. Government exists to govern. Good businesses exist to employ a workforce and leverage resources to create prosperity. At the same time, nothing prevents government from being more innovative, more business-like or more responsive to consumer needs.

While we see a bloated bureaucracy, we also see a core of intelligent, experienced workers who can assist in transforming our province into what it should be – the leader in Confederation again. We can reform outmoded processes and eliminate dated policies. We can update information and communication technology and programming, all aimed at conserving precious tax dollars and offering a positive experience to those interacting with government.

The number one thing to create jobs and boost business expansion remains – get a grip on government spending.