More shell games from NDP government
Author:
David Maclean
2006/11/04
For years, the government has attempted to hide deficit budgets by withdrawing from something called a "fiscal stabilization fund." When the government spent more than it earned in a given year it would "withdraw" from the fund to call the budget balanced. In reality, however, the province was actually going further into debt. And it still is!
You see, the fiscal stabilization fund was an accounting trick aimed at solving a public relations problem. Taxpayers - and importantly voters - don't like deficits.
After years of soaring government debt in the 1980s the province was near bankruptcy. It was only after budget restraint and tax hikes in the 90s that the province was able to balance its budget. Taxpayers generally don't want to see the province go into the red ever again.
Yet Saskatchewan's NDP government saw fit to run deficits in three of the past five years and increase debt between 2001 and 2004 by $1.2 billion. All the while, the word "deficit" never passed the lips of a provincial finance minister. In fact, during those deficit years the province's press releases always proclaimed a balanced budget.
Was the budget really balanced Yes it was, if you think that taking a cash advance from your credit card to pay your mortgage balances your household budget.
To avoid the criticisms that come with running deficits, the government created the psychological construct known as the "fiscal stabilization fund" which actually had no money in it or account number assigned to it. When politicians spent more than they taxed, they would take money from the "fund" to pay the bills. In reality they were just piling up more debt.
In recent weeks, the province has announced a plan to correct the problem known as the "fictional stabilization fund." Due to high oil and gas prices the province has accumulated nearly a $1 billion in cash. Instead of paying down the province's massive accumulated debt, the government has set aside $887 million for future spending projects.
The politicians are asking you to forget about the old "fraudulent stabilization fund" and to embrace the new fund which really does have money in it. Why not just pay down debt with this money so we can reduce the debt burden of future generations Politics, plain and simple.
Saskatchewan is unofficially in election mode and the government wants the flexibility to spread enough cash around the province before going to the polls next spring or fall.
One would think the politicians don't need a savings account because oil and gas revenues are sky high and the government is swimming in money. One should think again. The government is actually forecasting another deficit this year.
That's right. Government revenues have increased by a third since Premier Calvert took office yet the province is planning on running a deficit while at the same time creating a "rainy day" fund. If you ask the politicians it's raining right now, and has been for the past five years.
While the politicians play shell games with your money to make themselves look good, our accumulated debt goes largely unaddressed. Last year the government spent $2.3 million each day just to pay the interest on the debt - which is more than was spent on agriculture and highways combined.
It has always been true that politicians will spend every penny they take unless told otherwise. It's time to send a clear message to politicians that enough is enough - stop spending the savings of future generations for your own political gain.