Tuesday, January 27, 2009

There Are Reasons I Don't Hire An Economist To Do My Accounting

So ... today's Budget Day, and Big Daddy's crew delivered the fantasy trip spending budget that had been hinted at. (I haven't had the time to look very closely at the spending portion of things yet - I'll start to take that apart later, after I've had a few hours to read it and think about it all)

But, it amazes me the logic that the Conservatives are using here. While a federal government budget is two parts prognostication, and one part actual accounting, we have to step back for a moment and wonder a little at the following:

The budget also vows to freeze EI premiums charged to employees and employees for 2009 and 2010, a measure that will cost Ottawa $4.5-billion over the next two years because the rise in claims will create a deficit it must cover.


So ... the government is expecting, and in fact planning on, an increase in expenditures; but it is going to freeze the incoming money stream? Actually, it's more twisted than that - they're going to freeze an income stream that is going to shrink. A ten percent increase in EI claimants isn't just a ten percent increase in the demands on the EI system, it also represents a reduction in the income the government has to work with in the first place.

I find this particularly ironic, since Conservative governments usually claim to be such great fiscal stewards and then they promptly overspend while shackling the government's ability to raise funds. (Remember, the HarperCon$ have been busily spending money like drunken sailors since 2006 - as long as it's for the military, they seem to have no restraint in their spending)

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