| The
Big Picture...
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A
Large National Debt
Canada's Net Federal National Debt
($Millions)
1961-62 14,825
1962-63
15,673
1963-64 16,871
1964-65
17,244
1965-66 17,223
1966-67
17,707
1967-68 18,750
1968-69
19,416
1969-70 19,277
1970-71
20,293
1971-72 22,079
1972-73
23,980
1973-74 26,191
1974-75
28,416
1975-76 34,621
1976-77
41,517
1977-78 52,396
1978-79
65,425
1979-80 77,392
1980-81
91,948
1981-82 107,622
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1982-83 136,672
1983-84 169,549
1984-85
207,986
1985-86 242,581
1986-87
273,323
1987-88 301,117
1988-89
329,890
1989-90 358,820
1990-91
390,820
1991-92 425,177
1992-93
466,198
1993-94 508,210
1994-95
545,672
1995-96 574,289
1996-97
583,186
1997-98 579,369
1998-99
576,257
1999-00 563,544
2000-01
545,396
2001-02 536,489 |
Source: Finance Canada
Key
Points
* Net federal government debt grew very rapidly from the late
1970s until the middle of 1990s.
* Only very recently has this trend been modestly reversed.
*Provincial debts add another $325 billion in liabilities.
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So, you may well ask, what does all this
mean? Firstly, it means that annual debt service charges are the federal
government’s second largest expense type, accounting for nearly
a quarter (23%) of all spending. This means that this is money that cannot
be spent on other initiatives (e.g. healthcare, education, defence, etc.).
There is clearly an opportunity cost in carrying a huge debt load. Secondly,
this means that Canadians, who have a very large tax burden, are paying
much of this money, not to improve the quality of life in this country,
but to pay lenders (many from other countries) interest on debts resulting
from overspending that happened in the 1970s and 80s. This is a continuing
drain on wealth and productivity.
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