Krisenwirtschaft: Trump will Kanadas Wirtschaft zerstören. Die Kürzungen auf Bundes- und Provinzebene erledigen seinen Job für ihn.
https://dougaldlamont.substack.com/p/crisis-economics-trump-wants-to-crush?utm_source=substack&utm_medium=email&utm_campaign=email-restack-comment&r=4w0lcl&triedRedirect=true
4 Kommentare
Have you seen provincial deficits across the country? They either have to cut or raise taxes by quite a bit to cover it. Sooner or later the bill will come due.
Canada crushed it’s own economy by relying on US Bailouts and then acting hostile toward the United States. Kind of stupid.
Im a former federal public servant. Public servants do necessary and important work. But we do NOT need 40% of them to do so than we did a decade ago. Especially given all the new technologies since then.
The author is indulging in a bit of circular reasoning: financial crises, which are the failure of monetly markets, happen when money markets fail.
They imply that financial crisis are the sams as ecomic collapse.
But that is simply not true. Both private and public debt crises have long histories of leading to economic collapse.
And it is true that private debt crises can prompt economic collapse – for example, Scotland after the Darien scheme (the stupidest colonial plan I think any European nation ever launched) put the entire Socts upper class into crippling debt, and led to the Act of Union, ending Scots independence to bail out Scotland from the country’s private debt crisis.
Ireland nearly collapsed (and would have without EU intervention) due to a collapse of a bubble that left the nation awash in unservicable debt.
But there are also a long trail of nations whose economies completely collapsed under thr weight of public debt.
Often, this comes when the country’s debt becomes so bad the government cannot fund critical services and benefits the people depend upon, like food subsidies or supply, pay of the civil service and army, or even the basic currency, as the government has to embrace hyper infation to service internal debt.
Famous examples include:
Bourbon France
The USSR
Czarist Russia
The German Weimar Republic
Zimbabwe
Argentina
Chavist Venezuela
There are, of course, other examples in history.
In each case, the failure of public finances, usually through mismanagement and hubristic borrowing, caused major collapses in the private markets of ordinary people who depended on government involvement to function, or just the collapse of the state itself.
In many of the above cases, the collapsing economy did not have a ton of private debt, because the state took on massive debt to subsidise consumption and investment, protecting individuals from major chronic debt.
Failure to care about overwhelming public debt can lead to economic crisis or even state collapse, and needs to be taken seriously.