[Thanos]

$1:

Moody’s also noted California has an unfunded pension liability of $120 billion, while Ontario had a surplus of $5.7 billion as at March 31, 2013.

Wow, that's a lot of someone else's money that could easily be re-routed into some fucked up windmill farm or crooked solar panel company.

[BeaverFever]

And:

$1:

Ontario is no California when it comes to debt

Despite scare stories, there is no sensible comparison to be made between the public debts of California and Ontario.

By MICHAL ROZWORSKI
Thu., Dec. 24, 2015

A recent editorial in the Toronto Sun compares Ontario’s public debt to that of California, suggesting that, at five times the size of California’s, Ontario’s debt is laying the foundations for a fiscal and economic emergency. Before readers get too terrified, the editorial changes tone: it’s alright, it coos; we can avoid the Californian nightmare if we just get our fiscal house in order.

Before looking at this second, prescriptive claim, it is best to first look at why there is no sensible comparison to be made between the public debts of California and Ontario.

The Sun frightens its readers by citing the fact that Ontario debt is, for example, five times higher than California’s when examined as a percentage of GDP. The arguments are rehashed versions of those made in a Fraser Institute report released a little over a year ago and have been quickly debunked, even by mainstream economists. The comparison really is one of apples to oranges.

Consider just one way in which this is so: the two jurisdictions face very different constraints on borrowing. As we saw with the recent debacle around the federal debt ceiling, the politics of debt in the United States can be, to put it mildly, complicated. At the state level, they are often even more so. For example, the constitution of California explicitly prohibits the state government to borrow in excess of $300,000… in an economy whose GDP is currently almost $2 trillion.

Despite this, California has a debt of nearly $150 billion. The magic lies in a range of accounting gymnastics based on extraordinary measures from launching popular-vote propositions to selling direct agency bonds. While these measures give California some fiscal policy leverage, they are by nature haphazard, frail and open to being contested. Indeed, a number of counter-measures have worked to limit fiscal leverage: the California government is required to balance its books every year since 2004 and the legislature requires a two-thirds majority to pass any tax increase.

Article Continued Below

These constraints help explain why California has a low credit rating and problems funding its debt, while Ontario enjoys good credit standing and its bonds require yields only slightly higher than those on equivalent federal government bonds.

Although debt-rating agencies are not the most trustworthy sources (see their high ratings of toxic assets up to the financial crash of 2008), in this case, they do provide some good arguments for why Ontario enjoys high credit ratings. For example, Moody’s cites Ontario’s control over fiscal policy, large and diverse economy and “strong debt management practices” as three key reasons for the sustainability of its debt. California only checks off the second on that list.

What, then, of the second question? Even if there is no California-size emergency, should Ontario nevertheless pre-emptively undertake fiscal adjustments to “rein in” its debt? For example, the Sun editorial suggests capping program spending growth at 4 per cent annually.

The fiscal policy constraints faced by California help answer such questions. Indeed, the Fraser Institute inadvertently leads us to the conclusion that the size of debt matters less than political and institutional context. The relative size of debt matters less than is commonly thought but has long been used as a magic number to push ideological solutions.

The ideology of the Fraser Institute casts the causes of debt as an excess of expenditures – in particular, social program spending. This ideology is currently triumphant. Despite having a much smaller debt than Ontario on any measure, California nevertheless undertook painful cuts to schools, universities, health care and social services to stop adding to its debt.

While tackling the other side of the ledger – raising revenues – could have accomplished the same goals, this tool was used only at the last minute and in relatively small ways because government institutions have been molded to make its use extremely difficult. Both the story of excess expenditures and the solution of draconian cuts seem so sensible because they flow from the same narrative of individual responsibility that has been created to mask inequality and legitimize its explosion.

Ontario has fewer legislative constraints and a larger revenue base than California, but it is subject to the same institutional struggles. Like California, the province has slowly undermined its ability to raise revenues through regressive and unnecessary tax cuts. Today, it is much easier to lower taxes than it is to raise them; much easier to cry wolf at debt than point the finger at causes of inequality.

So while Ontario is not California, the scary bit is that the province could become much more similar to the U.S. state if the thinking promoted by the likes of the Fraser Institute gets its way.



Michal Rozworski is an economist and lead researcher at Cause Comms. He blogs at Political Eh-conomy. @MichalRozworski.

https://www.thestar.com/opinion/comment ... _debt.html

[BeaverFever]

Thanos Thanos:

$1:

Moody’s also noted California has an unfunded pension liability of $120 billion, while Ontario had a surplus of $5.7 billion as at March 31, 2013.

Wow, that's a lot of someone else's money that could easily be re-routed into some fucked up windmill farm or crooked solar panel company.

That's not how pensions work. The money is held in trust for plan members by a third party, even governments can't get at it

[martin14]

BeaverFever BeaverFever:

As usual the Martin/2Cdo lovebirds show up to tag-team troll with empty insults.

Hey, you forgot Pluggy; don't be such a chump.

But please, keep trying to bullshit the people here that the physical size of Ontario
is a major factor in debt.

$1:

- Is far bigger in size

- 50% of the population and size of all of Australia

- Is larger in size than all US states

You really should sit down and re-evaluate who is the dummy here.


Now you can call me more names and throw more insults around.

[2Cdo]

BeaverFever BeaverFever:

As usual the Martin/2Cdo lovebirds show up to tag-team troll with empty insults.

Keep trying to justify your love-fest for this bunch of thieves and Im sure the remaining two of your menage a trois will appear to give you "a hand", or whatever else you three are into.

[2Cdo]

BeaverFever BeaverFever:

And:

$1:

Ontario is no California when it comes to debt

Despite scare stories, there is no sensible comparison to be made between the public debts of California and Ontario.

By MICHAL ROZWORSKI
Thu., Dec. 24, 2015

A recent editorial in the Toronto Sun compares Ontario’s public debt to that of California, suggesting that, at five times the size of California’s, Ontario’s debt is laying the foundations for a fiscal and economic emergency. Before readers get too terrified, the editorial changes tone: it’s alright, it coos; we can avoid the Californian nightmare if we just get our fiscal house in order.

Before looking at this second, prescriptive claim, it is best to first look at why there is no sensible comparison to be made between the public debts of California and Ontario.

The Sun frightens its readers by citing the fact that Ontario debt is, for example, five times higher than California’s when examined as a percentage of GDP. The arguments are rehashed versions of those made in a Fraser Institute report released a little over a year ago and have been quickly debunked, even by mainstream economists. The comparison really is one of apples to oranges.

Consider just one way in which this is so: the two jurisdictions face very different constraints on borrowing. As we saw with the recent debacle around the federal debt ceiling, the politics of debt in the United States can be, to put it mildly, complicated. At the state level, they are often even more so. For example, the constitution of California explicitly prohibits the state government to borrow in excess of $300,000… in an economy whose GDP is currently almost $2 trillion.

Despite this, California has a debt of nearly $150 billion. The magic lies in a range of accounting gymnastics based on extraordinary measures from launching popular-vote propositions to selling direct agency bonds. While these measures give California some fiscal policy leverage, they are by nature haphazard, frail and open to being contested. Indeed, a number of counter-measures have worked to limit fiscal leverage: the California government is required to balance its books every year since 2004 and the legislature requires a two-thirds majority to pass any tax increase.

Article Continued Below

These constraints help explain why California has a low credit rating and problems funding its debt, while Ontario enjoys good credit standing and its bonds require yields only slightly higher than those on equivalent federal government bonds.

Although debt-rating agencies are not the most trustworthy sources (see their high ratings of toxic assets up to the financial crash of 2008), in this case, they do provide some good arguments for why Ontario enjoys high credit ratings. For example, Moody’s cites Ontario’s control over fiscal policy, large and diverse economy and “strong debt management practices” as three key reasons for the sustainability of its debt. California only checks off the second on that list.

What, then, of the second question? Even if there is no California-size emergency, should Ontario nevertheless pre-emptively undertake fiscal adjustments to “rein in” its debt? For example, the Sun editorial suggests capping program spending growth at 4 per cent annually.

The fiscal policy constraints faced by California help answer such questions. Indeed, the Fraser Institute inadvertently leads us to the conclusion that the size of debt matters less than political and institutional context. The relative size of debt matters less than is commonly thought but has long been used as a magic number to push ideological solutions.

The ideology of the Fraser Institute casts the causes of debt as an excess of expenditures – in particular, social program spending. This ideology is currently triumphant. Despite having a much smaller debt than Ontario on any measure, California nevertheless undertook painful cuts to schools, universities, health care and social services to stop adding to its debt.

While tackling the other side of the ledger – raising revenues – could have accomplished the same goals, this tool was used only at the last minute and in relatively small ways because government institutions have been molded to make its use extremely difficult. Both the story of excess expenditures and the solution of draconian cuts seem so sensible because they flow from the same narrative of individual responsibility that has been created to mask inequality and legitimize its explosion.

Ontario has fewer legislative constraints and a larger revenue base than California, but it is subject to the same institutional struggles. Like California, the province has slowly undermined its ability to raise revenues through regressive and unnecessary tax cuts. Today, it is much easier to lower taxes than it is to raise them; much easier to cry wolf at debt than point the finger at causes of inequality.

So while Ontario is not California, the scary bit is that the province could become much more similar to the U.S. state if the thinking promoted by the likes of the Fraser Institute gets its way.



Michal Rozworski is an economist and lead researcher at Cause Comms. He blogs at Political Eh-conomy. @MichalRozworski.

https://www.thestar.com/opinion/comment ... _debt.html

Using The Star as an honest reporter of Liberal shenanigans?

[OnTheIce]

BeaverFever BeaverFever:

And then realize this claim of "largest sub-sovereign borrower on the planet" is completely useless rhetoric.

You cannot defend this government with a straight face and think we won't call you on it.

You often posted articles about the debt that Harper accumulated during his tenure and now that it's your Ontario Liberals fucking things up, debt is suddenly good.

Ontario's credit rating had dropped twice under the eye of the Ontario Liberals.

Now that Ontario's debt is out of control, debt is good.

[BeaverFever]

OnTheIce OnTheIce:

You often posted articles about the debt that Harper accumulated during his tenure

$1:

No I didn't. And I'm no fan of Martins big surpluses. What I did do is mock the Federal Conservatives for being debt-obsessed and shrieking that Liberals will bury the nation in debt, meanwhile the truth is that Harperites were the biggest debt pigs of thm all, while Chretien-Martin were the most prudent. So by your own shitty flawed Conservative standards Chretien Martin should be your gods while Harper should be your worst nightmare.

$1:

Ontario's credit rating had dropped twice under the eye of the Ontario Liberals.

. It's still AA2 which is the second highest rating there is (so technically didn't drop twice)and as per my earlier article, Ontarios rating is much better than most US states and other sub-sovereign jurisdictions living under Conservative controls.

And did you not get the news that the same rating agencies recently upgraded Ontarios credit outlook?

[BeaverFever]

martin14 martin14:

BeaverFever BeaverFever:

As usual the Martin/2Cdo lovebirds show up to tag-team troll with empty insults.

Hey, you forgot Pluggy; don't be such a chump.

But please, keep trying to bullshit the people here that the physical size of Ontario
is a major factor in debt.

$1:

- Is far bigger in size

- 50% of the population and size of all of Australia

- Is larger in size than all US states

You really should sit down and re-evaluate who is the dummy here.


Now you can call me more names and throw more insults around.

No not Pluggy just you and your lover 2Cdo.

And if you can't figure out how larger territory relates yo larger operating budgets then you're dumber than I thought, and I really did think you were pretty dumb already.

Yeah I don't want to insult you, but you make it so difficult not to. If you're going to dish it out then you better learn how to take it, Nancy. Or is your boyfriend 2Cdo going to defend your honour and then hold you close?

[martin14]

BeaverFever BeaverFever:

No not Pluggy

PluggyRug PluggyRug:

If you're going to bat for the Ontario liberals, you should try using a bat.

Your stupidity is rather selective, if you can't see the criticism.

Nothing new here, move along folks.

[BeaverFever]

Yeah he chirps up from time to time but he's not attached at the crotch the way you and 2Cdo are. Whenever one of you two posts the other is usually right behind, bringing up the rear.

[2Cdo]

BeaverFever BeaverFever:

Yeah he chirps up from time to time but he's not attached at the crotch the way you and 2Cdo are. Whenever one of you two posts the other is usually right behind, bringing up the rear.

Way to project!

[BeaverFever]

Ah the old "I know you are but what am I?" line.


Lame.

[OnTheIce]

BeaverFever BeaverFever:

No I didn't. And I'm no fan of Martins big surpluses. What I did do is mock the Federal Conservatives for being debt-obsessed and shrieking that Liberals will bury the nation in debt, meanwhile the truth is that Harperites were the biggest debt pigs of thm all, while Chretien-Martin were the most prudent. So by your own shitty flawed Conservative standards Chretien Martin should be your gods while Harper should be your worst nightmare.

You did, actually.

During the Harper era, you posted many articles about his financial record. Those articles were often quite critical of Harper and his management of our finances so I can only assume by you posting and commenting in those threads that you support what was being said.

[2Cdo]

OnTheIce OnTheIce:

BeaverFever BeaverFever:

No I didn't. And I'm no fan of Martins big surpluses. What I did do is mock the Federal Conservatives for being debt-obsessed and shrieking that Liberals will bury the nation in debt, meanwhile the truth is that Harperites were the biggest debt pigs of thm all, while Chretien-Martin were the most prudent. So by your own shitty flawed Conservative standards Chretien Martin should be your gods while Harper should be your worst nightmare.

You did, actually.

During the Harper era, you posted many articles about his financial record. Those articles were often quite critical of Harper and his management of our finances so I can only assume by you posting and commenting in those threads that you support what was being said.

Don't confuse him with anything approaching the truth or something he said in the past. He's becoming more like andy, and that's not too smart.