AIMS refutes austerity hysteria #nlpoli #AIMS

From the latest Atlantic Institute for Market Studies paper:

"Measuring Austerity in Atlantic Canada investigates whether the use of the term austerity in the context of Atlantic Canada’s public finance is accurate. The author examines public accounts data from the four provinces, adjusting for inflation, to determine the annual amount of program expenditure in absolute and per capita terms. He also calculates the relative increase or decrease in spending from year to year, establishing the trend in provincial government expenditures in Atlantic Canada.

"The report offers three main findings:

• The budgets of southern European countries such as Portugal, Italy, Greece, and Spain (the so called “PIGS” nations) have experienced genuine austerity following the Great recession. These countries had to cut their government spending by up to a quarter, over as few as two fiscal years.
• Provincial governments in Atlantic Canada have increasingly spent more money on programs — in absolute and per capita terms — between 1980 and 2016. Per capita program expenditure in Newfoundland and Labrador saw the greatest increase at 113.7 percent. Prince Edward Island’s growth rate was the slowest at 61 percent over the examined period.
• A shifting demographic landscape in the region — notably its aging population — does not suffice to explain these significant spending increases. While the school-age population has dwindled in the four Atlantic provinces, education spending continues to grow, showing that spending increases cannot be a response to demographic changes.

"The report concludes that the use of the term austerity in relation to fiscal policy in the Atlantic Canadian provinces is hyperbolic, inappropriate and inaccurate.

"All governments spend more money than they did a generation ago, with only minor blips of restraint and no sustained or disciplined effort to cut spending significantly. The nature of Atlantic Canadian public finance, therefore, is not one of austerity but of consistent spending growth over a sustained period."

-srbp-

NL NDP boss admits deeper “austerity” on the table as gov cash situation worsens #nlpoli

“All options are going to have to be considered I guess, from both the revenue and the expenditure side, to make the best of a challenging situation,” NDP leader Earle McCurdy told CBC on Wednesday.

“All options” includes more job cuts,  spending reductions, and public sector layoffs in addition to higher taxes.

That endorsement of “austerity” as a serious option is a radical change of direction for the provincial Dippers,.  Up to now, they’ve been adamantly opposed to any cuts to public spending no matter how bad things got.