Quebec's per capita income ranks 54th in North America—only four Canadian provinces and two US states are lower. The provincial government complains that it doesn’t get enough aid hand-outs charity fiscal support from Ottawa. Yet Quebec's government spends more, taxes more, and—because the former consistently exceeds the latter—owes more than other provinces. If those problems were tackled, the provincial economy would become more productive and generate a lot more tax revenue. But no, we can't do that. It's not the "Quebec model".
Rather than curtail expenses, Quebec demands more money from other parts of Canada.Quebec, for example, has made social choices to keep university fees the lowest in North America, give families $7-a-day child-care spaces, provide a provincial drug plan, subsidize many industries, keep hydro rates well below North American market costs, and have a large public service.
No other equalization-receiving province can afford these kinds of choices, but they are part of the "Quebec model" and, therefore, are apparently difficult to change. The "Quebec model" contributes to the gap between spending and taxes that the Quebec political class believes is due to the "fiscal imbalance" rather than the province's own choices.
Alain Dubuc has written an "iconoclastic" book probing Quebec's economic malaise, pointing out what Quebec has to do if it wants to stop living beyond its means.
Globe and Mail columnist Jeffrey Simpson thinks that much of what Mr Dubuc says applies as well to the rest of Canada.
[R]eading his description of Quebec's hang-ups, fear of success, useless anti-Americanism, ossified identity debates and refusal to focus on productivity instructs any reader how Canadian Quebec really is. These habits infect the entire Canadian political culture too.
Quebec's pathetic appeals to alleged "fiscal imbalance" have been enabled—indeed, cultivated—by decades of Liberal governance at the federal level. Liberal prime ministers (who mostly originated from which province?) institutionalised the system of inter-regional transfer payments, euphemistically known as "equalisation" payments, that forms the basis for the "fiscal imbalance" fantasy. The Liberal Party of Canada shares the blame for Quebec's economic debility.
For access to Mr Simpson's full column, click here.









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[...] Premiers not interested in national daycare program By StatGuy The annual premiers' conference is usually a snore-fest producing very little in the way of real accomplishment. Last week's was no exception. The big agenda item was an attempt to negotiate a united front on equalisation payments which, predictably, failed. The good news was that no attention was given to a national daycare program. The Toronto Star's Ian Urquhart comments: Conspicuously absent from the communiqué issued last week by the premiers following their annual conference was any mention of child care.. . .Making this oversight all the more curious is that the premiers have good reason to complain about Ottawa's handling of the child-care issue. And complaining about Ottawa is what they do best. [...]
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[...] Strong growth is also forecast for BC and Newfoundland, while the Quebec economy will continue to struggle. RBC predicted that the U.S. economy would grow at about a 2.5-per-cent annualized rate in the second half of 2006 and in 2007, amid slowing consumer spending and a cooler housing market. It predicted that the Canadian dollar would decline to 85.5 cents (U.S.) by the end of 2006 and to 80.6 cents by the end of 2007, from 88 cents currently. [...]
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Please, please get a job!…
Quebec wants to coax people off welfare — CBC Montreal, 19 March
Previous related post: Quebec’s feeble economy is its own fault
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