Jim Flaherty provided an updated fiscal statement yesterday at the Chamber in Commerce in Victoria. He has revised the projected deficit this year from $50 billion to $55.9 billion. In January the deficit projection was $34 billion. I find it amusing that on the same day the Bank of Canada made an announcement that says recent information suggests that "growth in the second half of 2009 could be stronger than the Bank projected in July". As well, last week Statistics Canada released a report that employment increased in August which was a pleasant surprise. So amidst above expected figures for job growth, GDP growth and on the stock market Jim Flaherty thinks that all of a sudden the economy is doing a lot worse than he previously thought. Does he expect us to take these projections seriously? Is he going to tell us next month "Surprise I think we might be in surplus territory"?
How does Flaherty plan on getting rid of this deficit over the next 7 years? Well he has promised not to raise taxes or to reduce transfers to individuals or the provinces. I presume that this means that the federal government will be reducing the number of people that work directly for the government and getting rid of the services they provide. Though maybe this will not be a problem because of the 10 000s of public servants who provide no service to the public. If only there was a government department of "Public servants paid for no reason" that would be easy to cut. Unfortunately, making significant cuts to government expenses will involving cutting the services provided by the government.
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