More “tymlee” than ever in light of our upcoming election.
Now is the time not only to manage government debt responsibly, but also to restructure debt financing through the government access to capital markets.
Following the Great Recession of 2008 to 2009, governments in North America and elsewhere are faced with smaller tax revenues at a time when citizens rely more heavily on government funded social programs. This has resulted in significantly increased government deficits and debts, which in turn have put pressure on governments to reduce fiscal outlays for social programs in order to reduce the debt load.
Here, and in the United States, most of the social programs, such as health care, government pension plans and social security, employment insurance, etc., may be described as “unfunded liabilities.” This means that, with the exception of the Canada Pension Plan, social programs rely largely on tax revenues and interest bearing notes for funding, and are not supported by capital investments.
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