Let’s Talk About CROWN CORPORATIONS and The Real Reason Canada has the lowest deficit-to-GDP ratio in the G7 (Supply Management-Price Controls-Austerity) – October 17, 2023
I’ve stated my position on the GOLD STANDARD on quite a few posts, and my position is that no Conservative or Libertarian in this type of Democracy should want a Gold Standard, primarily because the atmosphere in the West still appears to side with CONFISCATORY fiscal policies.
So if you imagine that a Gold Standard will fix the immorality of democracy and politics in the Western World, I believe you’re wrong. The fiat monetary system we’re using is a reflection of the immoral public, wanting something for nothing, a public that prefers lies over the truth.
What is deficit-to-GDP?
A fiscal deficit is calculated as a percentage of gross domestic product (GDP), or simply as total dollars spent in excess of income.
Why Canada tends to outperform other countries is because of Crown Corporations. G7 countries include Canada, France, Germany, Italy, Japan, the United Kingdom and the United States.
The U.K. as an example, doesn’t have a supply management system, nor does the U.K. have 10 PROVINCES, all with their own Provincial Crown corporations. For example, Canada Post is a Crown Corporation, whereas in the United States, the United States Postal Service(USPS) is INCLUDED in its deficit-to-GDP ratio.
I think America is the worst country to use in regards to deficit-to-GDP ratio because for example, the U.S. has a much larger military budget than Canada. Canada can’t even exist without America. I believe it was a year or two ago the President of The Philippines made a joke saying he would invade Canada well based on Canada’s military budget to the Philippines’ military budget, the Philippines would likely find a lot of success if they did make that decision to invade and the United States didn’t intervene.
There are lot of things Canada DOES NOT spend money on because geographically it borders and therefore benefits from the United States, but what makes a major difference in the Canadian deficit-to-GDP ratio are CROWN CORPORATIONS and the price controls that exist because of Crown Corporations.
Supply Management is the perfect example of Canadian consumers being forced to finance the Canadian Dairy Commission (CDC), which is a crown corporation. The CDC does not show up as a TAX or a public debt; in fact, if we’re to be honest, it is posted as a positive cash-flowing ASSET to the Federal Government.
But you see, these crown corporations ACCELERATE poverty when the wrong fiscal policies are implemented because crown corporations(State Owned Enterprises) are inherently INFLATIONARY.
Canada’s Federal Government also has a very profitable Crown Corporation known as the Canada Mortgage and Housing Corporation(CMHC), which contributes to Canada having one of the most expensive housing markets in the world.
The CMHC, similar to most Crown Corporations, serves as a PRICE CONTROL mechanism for the housing market. The CMHC offers a mortgage insurance product that guarantees payment to the CMHC bond holder via the Canadian Taxpayer. So, regardless of how high-interest rates in Canada get, there doesn’t appear to be any appetite for price DEFLATION in the Canadian housing market.
Crown Corporations in Canada serve as PRICE CONTROL mechanisms, which actually help in BOASTING tax revenue; now, if you’re a moron, you’d say to yourself this is fantastic until you comprehend that in order to maintain this monstrosity, Canada’s poor and middle class will have to continue to get PROGRESSIVELY poorer.
Imagine lifting weights and the more tired you get, the more dumbbells get added. The weight of the Federal Deficit in Canada gets entirely shifted to the Canadian taxpayer, with NO WAY OUT.
Crown Corporations are MONOPLIES, so as an example, no private company can compete with the Canadian Dairy Commission (CDC), no mortgage insurer can compete with the CMHC; a lot of provinces in Canada have their own price-fixing cartels, called Provincial Crown Corporations, so in some Canadian provinces, the price of liquor is FIXED by the government, in British Colombia, the price of auto insurance is FIXED by ICBC.
If you’re wondering why the Canadian economy hasn’t collapsed yet, well, lucky for Canada, it borders with the United States and it’s the U.S. largest trading partner, so in many instances, Canada is the BENEFICIARY of the U.S. going further into debt.
In the real world or under a Gold Standard, the U.S. couldn’t finance Canada’s military spending; it’s these little things that don’t show up on the deficit-to-GDP ratio that allow Canada to look GREAT on paper.
Based on the math, I’m still of the belief that Canada may again be the first country to implement austerity measures, not because it wants to, but because it will have to.
When you have a lot of price control mechanisms in place, the last thing you want is runaway inflation because what I also failed to write about in detail in the post is that a lot of these Crown Corporations in Canada have an enormous workforce, all with some of the best pensions and overall benefits in the country, and because these UNIONIZED Crown Corporation workers have wages that keep pace with inflation, anytime the inflation rate goes up, their wages typically go up with it.
So you see how inflationary fiscal policies in Canada trigger other events to occur, yet the deficit-to-GDP ratio will still remain low because of how debt is structured; these debts aren’t on the Federal Government’s Balance Sheet.
Canadians have a good history of paying their debts, and one could even argue suffering in silence because, at the very least, it can be argued that Canadians enjoy their public services.
What I do like to see in closing is that the structure of the Canadian economy is very RARE in the world because it borders with and shares the same language as the United States. Unlike Mexico, Canada does not have the same type of border problems.
For Example, Mexico has two borders to worry about: its southern border and northern border; Canada borders with America, and America Borders with Russia(via Alaska), so this again is another problem MILITARY problem Canada doesn’t have to worry about.
So because Canada doesn’t have the same border problems, it has fewer gang and territorial disputes than you’ll see in Mexico. Canada structurally is the beneficiary of the British, being under the Commonwealth, so these additional perks, along with the flexibility to implement its own policies, equates to a lot of SAVINGS Canadians.
But all of this comes at a price because a lot of Canadians can imagine that socialism does work, and this has a devastating effect on Canadian politics, as Canada has a lot of FEDERAL regulations that would destroy countries that don’t share a border with the United States.
If, for example, you took Canada and put her in the Oceanic regions of the world, its current fiscal policies would be disastrous AND WOULD HAVE immediate CONSEQUENCES. With that said, the deficit-to-GDP ratio doesn’t tell much of a story; it’s a number politicians can brag about.
Interesting times ahead!