The rhetorical deficit

by Aaron Wherry

Tabatha Southey considers the rhetoric of public debt.

It’s easy to alarm people over a deficit. It’s a high number and people are forever being told that it’s theirs and their children’s debt and specifically how much of it is theirs, per capita. But no one ever tells them how much highway they own, per capita, or what section of the Grand Canyon is theirs. It’s a very one-sided, frequently opportunistic way of expressing the situation.

The consequences of playing a game around the largely artificial debt ceiling are very real. This is politics triumphing over economics, but without the triumph.




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The rhetorical deficit

  1. Yes, and we’ll pass a debt down to our children, as we had a debt passed down to us….since Canada and the US were both in debt on day one of each country’s formation.

    We will also pass down a stable, peaceful, prosperous country with universal education and healthcare.

    Only the rhetoric of fools would try and make this sound like a bad thing.

    • Any incorporated entity, whether a business, charity, or in this case, governments, will pretty much have to start out in debt due to the legal & accounting systems used by both Common Law & Civil Law states.  Someone has to pay the costs of starting up before the entity before it can bring in revenue.

      In some ways a state can be like a family or a business, as long as the metaphor isn’t abused (and our media would NEVER abuse a metaphor . . .)  Business corporations aren’t criticised for taking on debt financing, as long as it generates a net benefit and the corporation is able to manage cash flows.  If said business’s debt keeps increasing in proportion to total finances, not so good.  However, stable or decreasing debt is usually a good thing.

      I’m thinking of my wife’s family.  Her uncle doesn’t help pay for her grandmother’s long-term care, while the aunts split the costs according to their ability to pay.  If you think of the wealthy Americans with a sense of entitlement who make big contributions to both parties to keep from paying personal income tax to be the uncle, and the small- to medium-sized enterprises & middle class individuals who pay the most taxes are like the aunts, the USA is a lot like a family.

      And while we’re splitting hairs, a “nation” is a large group of people in a relatively fixed geographic area who share a language & culture.  Nations don’t have debt.  A “state” has a government, constitution, justice systems and one or more incorporated entities that can manage finances & go into debt. Make this distinction, and a lot of public obsessions in Canada become pretty much chaotic stupidity.

      Given all this, I have to agree with Ms. Southey that when you look at a lot of the issues that consume national media & start defining terms, these issues start to look pretty stupid, or at best, not well developed enough to become a real debate.  Which makes them pretty much propaganda.  Since anyone who’s got through their open electives in  journalism degree should know all this stuff, I kind of have to think we don’t have real news media, we have a variety of public and private propaganda arms.

      • Yup, borrowing is a routine mechanism of any economic system…and the only way at the moment that a person or country can move ahead.

        Like anything else it can be abused, but it’s far easier for a country than an individual to bring resources to bear on the problem.

    • “In 1968, when Trudeau went from rich, socialist professor who had never held a real job in his life to prime minister, Canada’s national debt was a modest $11.3 billion; the federal deficit was zero. When Trudeau left office in 1984, the debt had mushroomed to $128 billion; the deficit to $25 billion annually.”
      http://forums.canadiancontent.net/canadian-politics/90622-two-articles-trudeau-real-legacy.html

      “In October 1970, tanks roamed city streets and soldiers in full battle gear raided homes in their hunt for “terrorists.” …..  Some felt like they were living in a police state. How far would Prime Minister Pierre Elliott Trudeau go? ” ……” 

      http://archives.cbc.ca/war_conflict/civil_unrest/topics/101-618/

      “That means the Liberals’ troubles run far deeper than having a flawed series of leaders; it means more Canadians than ever see a Liberal party foreign to their values and beliefs.

      http://www.nationalpost.com/news/Canadians+have+soured+Government/4915800/story.html

      John Derbyshire ~ Wherever there is a jackboot stomping on a human face there will be a well-heeled Western liberal to explain that the face does, after all, enjoy free health care and 100 percent literacy

      • Canada was in debt at the time of confederation, so stop trying to blame Trudeau for it.

        Now as I said…put the bottle down.

        • You do understand that debt is not a binary quantity, don’t you? Owing $1 is much different than owing $1,000, which is different than owing $1,000,000.

          It’s pretty much known by anybody with any knowledge of Canada’s history that Trudeau screwed the Canadian economy for a long, long time.

          • You do understand that the population of Canada has increased from 20M in Trudeaus’s time to 34M today don’t you?

            So the cost of running the country today is going to be much larger no matter who the PM is.

            You also understand that when Mulroney left office, we had the biggest debt and the biggest deficit in our history don’t you?

            And that the Liberals spent years hacking it back into good shape?

            And I’m sure you understand that if Canada was actually ’screwed’, Harper would never have reduced the GST, and blown the surplus, right?

            So spare me the Con mantras about dead people.

      • So if having an academic with no “real world” experience for PM is such a bad thing, why support Harper?  At least Trudeau had PAID academic experience.

  2. “If a nation were run like a business, the first thing a manager would do is get rid of all the old people hanging around the lobby. And let’s face it, babies are a total loss leader, when you could bring in pre-raised babies at a small fraction of the cost.”

    For those of us against abortion, not keen to murder children, it is not obvious at all that babies would be a loss leader because most people actually care about their children and put money into their well-being. I bet Ms. Southay supports abortion and euthanasia.  

    Is Ms Southay the most vain, insecure woman in Canada? Does Ms Southay know anything at all about economics?

    I read Ms Southey’s column on weekend and was glad that I was not a friend of hers. It must be difficult to be her friend and feel like you have to tweet her about what a wonderful column she wrote this week, as always, when she is mostly a peddler of twaddle. 

    Ms Southay’s father is miserly with money and that’s why Ms Southay has jaundiced view of families. For those of us who get along with our families, or don’t hate our parents, we don’t loathe the idea of government behaving like a household.

    • It’s too early in the day to be drinking, Tony.

  3. If the highway or “Grand Canyon” is funded by huge debt, then the “people” don’t own any of it. Amazing how this simple logic eludes some.

    • In much the same way that a person doesn’t own their house when it’s mortgaged.

      Oh wait.. they do.

      • You’re right. Correction: own it mostly by borrowing huge sums of money they might never be able to pay back, at which point they will no longer own it. China will. Thanks.

    • True, but it’s also not as if China’s going to send repo men over to box up the Grand Canyon and ship it to Beijing, or that the Chinese are going to start putting road tolls in on the I-90.

      • No, they’ll just become the world’s strongest nation, much as America itself did after loaning billions to warring factions in both world wars, then demanding collection. Americans will have less access to the world’s wealth and resources, which I suppose is what some actually want — for America to drown itself in debt. Hey, that’s worth “owning” the Grand Canyon with borrowed money, isn’t it.

      • “True, but it’s also not as if China’s going to send repo men …. ”

        Just wait till the ChiComs start sending engineers to America to upgrade infrastructure.

        Chinese state involvement in the trade is crucial. Each year Beijing provides billions of pounds in grants and loans to African governments as a sweetener to secure raw material deals or to finance infrastructure projects that could benefit its companies.

        That is what brought Liu Hui to Kenya. A slight, 41-year-old civil engineer, he was working for China Wuyi, a state-owned construction firm, in Fujian province in 2006 when he was called into his “leader’s” office, and told he was needed on a project to upgrade Nairobi’s main airport.

        Liu had never set foot outside China. He was reluctant to leave his wife and seven-year-old son. He knew as little about Kenya as Zheng He’s sailors. “My image was: very poor, dry and hot,” says Liu. “But if my company wanted to send me somewhere, what could I have done? You have to show your capacity for work.”

        http://www.guardian.co.uk/world/2011/feb/06/chinas-economic-invasion-of-africa

        Tweet I read yesterday ~ Debt deal has passed the House. It should easily pass in the Senate, and go to Hu Jintao for final approval.

        • As it also says:
          “Western countries also buy oil, and have mines around the world. People don’t talk about ‘grabbing’, or ‘new colonialism’ there. So why is it different for Chinese? We are not sending our armies to places and saying: ‘Now sell us this!’” Xu says. “If you can’t compete with us, you find an excuse. It’s like two children fighting, and the losing one crying to his parent about funny tricks.”

        • Just wait till the ChiComs start sending engineers to America to upgrade infrastructure.

          This reminds me of a funny Onion story the other day that had al Qaeda announcing that the infrastructure in America is so bad that they’ve decided to call off all terrorist attacks in the U.S. until they start fixing their roads and public buildings, because it’s just gotten way to difficult to operate in the U.S. with it’s lousy infrastructure, so they’ll wait to resume operations until things get fixed up.

  4. What a bunch of economically illiterate non-sense. You can’t sell “your” piece of the highway to pay the household bills. Your banker also won’t consider “your” piece of the Grand Canyon as an asset on your balance sheet.

    If you own something, it’s an asset. If you can’t sell something, you don’t own it.

    • The govt owns it, not individuals.

      Individuals can and do use and enjoy these items.

      • “The govt owns it, not individuals.” – Exactly. So when Tabatha says “no one ever tells them [John Q Public] how much highway they own”, you agree that she’s talking non-sense?

        “Individuals can and do use and enjoy these items.” – on a very limited basis. I can use a stretch of highway for traveling, but I can’t setup a tennis net across it on a Saturday afternoon when I feel like having a match with a friend. I can’t take a section of the pavement and use it as fill for my old pool.

        Her arguments make no sense when someone actually stops to think about them.

        • The govt IS the people…they all collectively own it.

          Not one person…everyone.

          • That only works if you redefine the word “own”.

          • LOL no it doesn’t.

            Publically owned, privately owned, collectively owned as a nation….I think everyone is clear on that.

    • If you own something, it’s an asset. If you can’t sell something, you don’t own it.

      The Grand Canyon is arguably different, but if the government wanted to sell the I-90 to a private concern, couldn’t they?  In fact, haven’t some highways actually been sold to private entities?

      • Of course, but that’s the government selling something, not the people. The federal government could sell the entire stretch of the #1 that runs through Manitoba, without anybody in Manitoba being in favour of such a deal.

        Likewise, the government of Manitoba couldn’t sell the part of the #1 hwy that runs through that province.

        So how does anybody in Manitoba own that stretch of highway?

    • Actually, that’s fair.

      But if you’re going there, then you have to do the same thing with the debt also.

      No debt holder is going to come to a random tax-payer and demand they open their wallet to pay their share of the national debt.

      So if you can’t say the people own the highways, etc, you also can’t say they owe anything either.

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