Consider first

There is a strain of economic thought snaking through academic and think tank hallways lately suggesting that our notions of the harmful effects of accumulating massive debt—specifically government debt— has been overstated. In simplistic terms these folks contend that as long as governments maintain the ability to print its own currency —underpinning strategies known as quantitative easing in the US elsewhere—our ideas about how much debt is too much is wrong, or at best outdated. They point to the high levels of debt carried by governments like the US, Canada and France as evidence that economies can grow and prosper even with this expanding burden. And with low interest rates projected for the foreseeable future, there appears little on the horizon to contradict this thinking.

I admit, however, at becoming uneasy when folks suggest that this time is different. After a generation of watching a particular economic trend—say rising house prices—we can convince ourselves we live in special times. We are eager, perhaps wired, to bend historic patterns to our own context and experiences.

All this to say that there are many smart folks who say we need not worry that Ontario’s debt is more than double what it was a decade ago. And growing. Unquestionably, the gross amount of government debt ($325 billion) is less important than the size and strength of Ontario’s economy—and therefore its ability to repay it. But even by this measure we are nudging historic highs at 40.5 per cent of gross domestic product.

Add to this the penchant of the previous provincial government for moving debt off of its balance sheet. One only has to drive by the Belleville Courthouse to see an example of long-term infrastructure debt masked as a 30-year lease. The Liberals’ late-game shenanigans to reduce the cost of electricity also required an elaborate financial structure to move this long-term cost off the province’s books.

This means that Ontario’s debt, both in dollar terms and relative to economic output is understated. Perhaps significantly so.

My purpose in highlighting this nagging concern is not to cause anxiety, nor is it meant to challenge folks more educated and trained on these matters. It is just that I don’t believe them. I don’t believe we live in special times. I believe gravity remains as powerful a force as the day Newton was struck by the apple descending from the tree branch.

I believe interest rates will rise one day and we will ask ourselves: How did we amass so much debt? And, what did we spend it on?

It is why, in part, a majority of Ontarians elected the provincial Conservatives. To stop the spending increases, to reverse the trajectory on budget deficits and perhaps one day, hack away at debt.

Many Ontarians, including this columnist, were disappointed when Doug Ford’s party struck out at the poor and disadvantaged as its opening gambit. Leaving aside the reprehensible morality of such moves, it was small peanuts. It all seemed too easy—making life harder for those on the margins while ignoring the massive spending in education and healthcare.

But now we have arrived at the two big provincial files. Ideas are being floated, plans are leaking out. This new government is, at last, beginning to assess ways to manage these sectors more efficiently.

The early choices made by this government, plus the blowhard ramblings of the premier, do not bode well. But I suggest—and I understand this is a big ask—that we listen, and consider, before we condemn.

Already the powerful vested interests in education and healthcare have arrayed their resources against this government and whatever it may do to rein in the cost of these services. Their mouthpiece, the Toronto Star, is ensuring resistance is mobilized and angry.

Doug Ford’s government may yet come to earn the hostility it is getting on these files. But it hasn’t done so yet. They are considering ways to run the businesses better and at a lower cost. That is what they were elected to do. Outright rejection of their proposals, before they delivered, makes it difficult to have a meaningful discussion.

There are good reasons to ensure economic circumstances don’t form a barrier to post-secondary education. And, by all means, let us all consider and weigh the evidence that programs such as all-day kindergarten are improving outcomes for these students.

But let us also hear the arguments for change.

I have significant reservations about yet another major renovation to the healthcare system in this province. A former MPP used to mock his own government for proposing that Local Health Integration Networks— another layer of bureaucracy in a business already overpopulated by paper shufflers and in desperate need of more front-line carers—was a reasonable prescription for the rising cost of health care in this province. Yet, it seems rash to dismantle this structure after a decade or so—rather than first look at fixing its flaws.

The Conservatives, lets face it, don’t have a stellar record in this province for restructuring schemes. That said, let us resist the knee-jerk rejection of these plans and ideas before we have had a chance to see them, examine them and consider whether or not they will work. Let us agree that it doesn’t have to be a partisan or ideological contest. We have some responsibility here.

Unless, that is, you believe debt doesn’t matter anymore.

rick@wellingtontimes.ca