By Dewan Mukto Browse All
Licensed under CC BY 4.0 （Unless specified otherwise)
Recently there has been a steep rise in the trend about the topic of Newfoundland and Labrador’s debt crisis, especially in the light of rising university fees at Memorial University. Ever wondered how did all this debt arrive in the first place?
Photo by Towfiqu barbhuiya on Unsplash
Here in the easternmost part of Canada, you will find its citizens suffering bitterly because of this invisible villain looming everywhere. Debt.
In 2021, just a handful of months ago, Siobhán Coady, the finance minister of the province, had announced that “a child born in the province today” will owe “debt as his/her birthright”. Just as terrible as it sounds, it is harsher than Jean-Jacques Rousseau’s political philosophy that “man is born free, and everywhere he is in chains.”. In Newfoundland and Labrador, mankind is being chained by their ancestral debts before birth!
Well, it is an obvious fact that debt simply does not “fall from the sky” nor spawn from the ground. Excess debt, like all other environmental and economical calamities, is man-made.
All of this is, in fact, a typical textbook case of economics gone wrong.
Part of the blame is directed towards the province’s governing authorities, who have been ignorant against their spending habits — they ended up accidentally spending in the wrong sectors and in the wrong quantities, leaving the public sectors starving for the funds they deserve.
If you are experienced and knowledgeable about a bit of economics here, you should instantly interpret that a lower level of public sector government expenditure means people and institutions working for the government — including state-run hospitals, schools, engineers — are not receiving enough monetary resources to live their lives. As an impulse to that stimulus, many people had to borrow money from others who were (at that time) financially sound and stable.
A period of time later, like a chain of dominoes falling over, almost everyone owes someone else a handsome (but intimidating) sum of money. Thus, the economic ‘gears’ have been clogged up as the way it is today.
Moya Greene, a Canadian businesswoman, claimed that it was unpleasantly surprising that several senior managers, whom she had interviewed for a economic report entitled The Big Reset back in May 2021, overlooked their deficits. They thought “the deficits didn’t matter”.
And to add salt to the wounds, she brought forward even more distressing facts by adding in, “We were pretty surprised that we don’t evaluate any of our programs, we just keep adding to (them). Those are ordinary principles of management.”
Furthermore, she does not know the accurate origin of this giant cloud of debt, but that Newfoundlanders “certainly have a long history of it”.
This can be discerned as a serious red flag (impending danger) for all resident Canadians and locals alike, since having one province drooping with economic depression is hurtful for the commerce of the entire nation — just like having one organ in your body is still a potential problem for the rest.
And what do the papers and statistics have to say?
The provincial government overspends, despite its cities being the topper “in the county” in terms of per capita revenues, confirms Sarah Smellie, Canadian Press staff. Merging all liabilities into a single figure, $47.3 billion was the total debt measured back in May 2021. If that does not sound very upsetting, the number is 473 followed by eight zeroes!
Think of the amount that might have accumulated by now! It has been more than 6 months since the report was published.
On the brighter side, however, it is never too late. The Big Reset also defined federal plans for applying countermeasures to control, eradicate or perhaps balance the trade deficits and provincial budget — something that would require five to six years of time and effort. Difficult, but not impossible!
To conclude the aftermaths of the debt crisis, here is a quote from Drew Brown, editor-in-chief of The Independent, who states “I’m a Newfoundlander born and bred, and I’ll owe debt till I die.”
Unless every individual begins to think on the economic level, the cracks may widen further. Indeed, it is up to us as the future generation to be the saviors at dusk. Every transaction and decision counts!