The roller-coaster economic news coming from the United States these past few weeks points out clearly that it matters how government spends money. It is proving to be a hard lesson to learn for lawmakers both in the United States and parts of Europe these days.
In the U.S., Washington politicians spent weeks debating an increase in the debt limit of the country. While the debt limit was eventually increased at the last minute, preventing a default of money owed by the United States to creditors, the process shined a bright light on the massive deficit and debt that is carried by our American neighbors. The fact that the United States has a debt of more than $14 trillion and growing by leaps and bounds has now caught the attention of the world.
It also caught the attention of credit rating agency Standard and Poor’s which downgraded the U.S. credit rating for the first time in history which resulted in a wild week on the stock market.
Suddenly there is the realization that a government, not unlike a household, cannot sustain wasteful spending forever. Eventually, there are consequences. While there have been some who have argued that government waste and debt could always be managed, the fact is that at some point it results in the kind of economic instability that we are witnessing in various places around the world.
It’s a lesson that matters in Manitoba as well. While Premier Greg Selinger and the NDP try to convince Manitobans to ignore wasteful spending, it’s getting difficult to pretend that the debt that comes as a result has no effect.
Premier Selinger and the NDP continue to tell Manitobans that it doesn’t matter that hundreds of millions of dollars will be wasted on building a new hydro transmission line (Bi-Pole III) on virtually the longest route imaginable. They continue to tell Manitobans that the Americans will pay for this added cost despite the fact that experts say it will fall to Manitobans to pay the extra cost.
When the NDP spend $13 million on an enhanced ID card system that only 17,000 Manitobans sign up for (at a cost of $750 per card), they refuse to acknowledge that it wasn’t a good use of tax dollars instead saying it was worth the cost.
This wasteful spending doesn’t mean much to the NDP because they don’t see any consequence to a ballooning debt. Yet the recent events happening just south of us are a lesson that eventually debt and wasteful spending have consequences. It’s a hard lesson to learn, and one that the NDP government seems oblivious to.
