Comment 26864

By A Smith (anonymous) | Posted October 07, 2008 at 01:54:08

Undustrial, let's take a look at how the Feds spend their money...30.3 B for old age benefits, 28.7B to the provinces for health and welfare benefits, 17B to the provinces for "other" fiscal arrangements, 14B for EI benefits, 11.2B for children's benefits, 26.8B for "other" transfer payments.

The Feds also spend 63.3B on ministries , including 15.7B on defense. Debt charges come out to 33.9B. All these figures are for 2007.

If you can tell me where the government donates large amounts of cash to corporations, I would love to hear it. As far as I can tell, it's the poor and middle class who get the bulk of government spending, even though corporations pay about 30% of federal taxes.

As to your point about welfare being a poor way to live, I totally agree.

What people really need is a growing economy, which was produced in the 90's when governments cut back on non military spending. The numbers show that when governments give less to the poor and middle class in benefits, the median income for these same people grows at a strong and steady clip.

Unfortunately, when governments go soft and give in to the demands of the electorate, the economy slows down. What government gives with one hand, the economy takes away with the other.

Call it balance, call it unintended consequences, the results are the same, making life harder on people is what helps them in the long run. Try to be nice to people and you only end up producing the opposite effect.

Here are some numbers to chew on (first figure is non military spending as % of GDP, second is real GDP growth, from US Bureau of Economic Analysis)...1993 - 28.98, 2.67, 1994 - 28.38, 4.02, 1995 - 28.61, 2.5, 1996 - 28.34, 3.7 1997 - 27.64, 4.5, 1998 - 27.13, 4.18, 1999 - 26.89, 4.45, 2000 - 26.81, 3.66. These figures are from Bill Clinton's two terms in office and they show how restraining government spending leads to robust growth in the economy.

Contrast those numbers with Bush Jr's two terms... 2001 - 27.6, 0.75, 2002 - 28.19, 1.6, 2003 - 28.25, 2.51, 2004 - 27.75, 3.64, 2005 - 27.97, 3.07, 2006 - 27.95, 2.87, 2007 - 28.7, 2.19
2008(first two qtr's annualized) - 29.25, 2.06.

Notice the correlation between bigger government and a slower economy.

This same effect can be seen in Canada, as the Conservatives have slowed the economy to a crawl by pushing spending to ridiculous levels in their first two years.

Contrast this with Jean Chretien, who slashed spending, but also allowed the economy to grow at world class rates during his first two terms.

The bottom line is that all things come at a price, so if really want to help yourself, try reducing the amount of government money that comes your way.

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