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The Big Picture...
The following two graphs represent a stark depiction of how successive
annual federal government deficits in the 1970s and 80s contributed to
the mounting debt problem in this country. The second graph depicting
the growth of the accumulated federal debt is particularly dramatic.
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Fiscal
Deficits Lead to Large National Debt
Canada: All Government Deficits and Surpluses as a Percentage of GDP,
1970-2002
1970 1.4
1971
0.7
1972 0.5
1973
1.2
1974 1.7
1975
-2
1976 -1.4
1977
-2.7
1978 -3.1
1979
-1.9
1980 -1.7
1981
0.4
1982 -1
1983
-2.2
1984 -2.5
1985
-3.6 |
1986 -2
1987
-0.9
1988 -0.6
1989
-0.2
1990 0.1
1991
-0.5
1992 -0.9
1993
-0.7
1994 0.4
1995
2.2
1996 4.9
1997
6.9
1998 6.6
1999
7.1
2000 7.9
2001
7 |
Source: Finance Canada
Key
Points
* For 15 years Canadian governments consistently
ran significant deficits in relationship to the total economy.
* This occurred in peace time and a time when revenues were already
increasing due to higher taxes.
* Since the mid 1990s, governments have had to run very large surpluses
to make up for their previous prolificacy. |
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