[bootlegga]

$1:

OTTAWA (Reuters) - The finances of Canada's federal government and its 10 provinces are unsustainable over the long term and they will need to either raise taxes or cut spending, in part because the population is aging, the country's budget watchdog said on Thursday.

"Fiscal sustainability requires that government debt cannot ultimately grow faster than the economy," Kevin Page, the parliamentary budget officer, said in a report that looked at likely trends over the next 75 years.

Page's team projected government debt relative to the size of the economy over the long term in the light of current spending and taxes as well as projected demographic and economic trends.

"(Our) debt-to-GDP projection indicates that the current federal and provincial-territorial fiscal structure is not sustainable over the long term," he wrote.

"Addressing this fiscal gap and restoring sustainability to public finances would require permanent policy actions of 2.7 percent of gross domestic product, either to raise taxes, reduce overall program spending, or some combination of both."

Page said slower labor force growth caused by an aging population would reduce annual average real gross domestic product growth from the 2.6 percent observed over the 1977-2010 period to 1.8 percent over the 2011-2086 period.

http://ca.news.yahoo.com/watchdog-warns ... 38941.html

[Caelon]

The baby boomer demographic bubble has had more impact on NA economic policies in the last 60 years than any other event. The actual policies have evolved as the boomers have gone from infants to school age to entering the work force to high income years to retirement. The latter is what will be forefront on government agendas for quite awhile. First impact is retirees generally have less taxable income than they did in the last few years before retirement. At the same time seniors place greater demands on an already stressed health system. At the same time the existing work force is a declining percentage of the population. Ta da an economic problem.

Lastly think of where the major votes to elect a government are. Any party that wants to buy votes will propose legislation that favours seniors. Then once elected they will face the reality of controlling the expense of seniors. The recent changes to the CPP are some of the first steps to move the liabilty farther out and reduce the total cost.

[Wada]

If Mr. Harper says we're OK then we must be.

[CommanderSock]

Keep the immigration doors open to keep supplanting the population with youngsters from developing countries. Stop grannys from being brought in though.

[andyt]

CommanderSock CommanderSock:

Keep the immigration doors open to keep supplanting the population with youngsters from developing countries. Stop grannys from being brought in though.

It would take a quadrupling of immigration numbers, ie 1,000,000 a year to reverse the demographic trend in this country. And what happens when those immigrants get old? All you'd be doing is pushing that bubble, which would be much bigger, down the road. At some point the world has to face up to the fact it can't keep growing its population to get out of economic trouble, learn how to live with a stable population.

[Bruce_E_T]

andyt andyt:

CommanderSock CommanderSock:

At some point the world has to face up to the fact it can't keep growing its population to get out of economic trouble, learn how to live with a stable population.

First it has to figure out how to establish a stable population. Rather quickly as well, I would think.