the growth of government

William Mackness, former Chief Economist with the Bank of Nova Scotia, discusses Canada’s history of financial responsibility up until the 1960s in this clip from the Days of Reckoning video.

DAYS OF RECKONING William Mackness Canada’s history of financial responsibility up until the 1960s (.avi file size 2.70 MB)

And, ironically, Mackness notes, in this clip from the Days of Reckoning video, that it is only those with the very best reputations who can get themselves as far in debt as we have.

DAYS OF RECKONING William Mackness Only those with the very best reputations can get themselves as far in debt as we have (.avi file size 3.17 MB)

What are the implications of the exponential growth of government in Canada over the previous four decades? According to Brian Crowley, of the Atlantic Institute for Market Studies, it means more and more of our economy is directed by governments at various levels, and that this stifles creativity, innovation and wealth creation. In the book Taking or Making Wealth, part of The underground royal commission Report, he notes that:

The most fundamental force driving the economy is innovation. It’s change….We have progressively moved to a system in Canada where innovation is harder and harder to achieve. One of the reasons for that is that government has begun to take a larger and larger place in the economy.

In fact, over the last 30 years we have seen government take control of something like 40 percent of the gross domestic product. In other words, 40 percent of the value of the goods and services that we produce in Canada passes through the hands of government.

We have created a system (transfers, subsidies, tariffs, etc.) in which there are huge transfers of money going from productive people in the economy who are making goods and services to people who find it’s more profitable to get benefits from government than to get out and work in the marketplace.

Are We Over Governed?

Given that close to 40% of the economy is generated by government spending and that we, on average, work for half a year to pay taxes to all levels of government in Canada, can we say we are over governed in this country? Or do you believe that we live in a better country because we have so many government programs? Are we a fairer, kinder, gentler more just society because of the redistributive role of government? Have we gone too far down this path that it is leading us to financial ruin? What are your views? Let them be known, and find out what other Canadians are saying, in the discussion forums.

For Further Study

Books

Days of Reckoning

Taking or Making Wealth

Guardians on Trial

A Call to Account

“Just Trust Us”

Videos

Days of Reckoning

We are now ready to examine in more detail the things we have come to expect from government. We will begin with middle-class entitlements.