The following is a response by our friends at the Committee on Monetary and Economic Reform (COMER)... More proof that Neoliberalism is a tool designed to starve the public sector to enrich the private sector. This article has so much neoliberal false logic in it, designed to fool people into thinking government and household debt is somehow comparable. Let's debunk this article more fully from the perspective of Canada being a sovereign currency-issuing nation with its own central bank: - while debt is important to watch (for various reasons), the debt is in Canadian dollars, which the Bank of Canada (BoC) regulates and creates, so worrying about debt when you issue the dollars of said debt is like having a conversation and worrying about running out of words. While the power must be used responsibly, the Bank of Canada (and by extension the government) cannot run out of money or ever be insolvent (also because we have little foreign debt and have never taken loans from the IMF or World Bank). We are NEVER at risk of defaulting on domestic debt, it's literally impossible. - market debt is all self-imposed, the government has made the conscious decision (at the behest of bankers) to borrow money instead of creating it through monetary financing by the BoC (when the BoC buys government bonds it creates new money in the Receiver General's account) https://lop.parl.ca/…/…/ResearchPublications/2015-51-e.html… - the interest on the debt is driven by interest rates, which are set by the BoC, which is under the control of the government (when push comes to shove). It was precisely disagreements with Governor Coyne over interest rates and monetary policy that led to changes in the BoC Act to give the Finance Minister final say. Point being, fearing interest rate changes is silly when the government has full control. - comparing federal debt to household debt is not comparable, because households do not issue their own currency and then issue debt in that currency. - it's a bit of a red herring to talk of the government's balance sheet separately from the Bank of Canada, as the government's prudential liquidity plan inflated the government's account at the BoC, but it all just sits there doing nothing. - deficit spending is indeed proven to grow an economy, surpluses and austerity shrinks them - the comparison to Greece and Ireland is most telling, as it's either another scare tactic red herring, or shows gross ignorance of our monetary system. Greece and Ireland are part of the EU and use the Euro, which is controlled by the EU central bank. Canada has no such external authority controlling our monetary system, ours is sovereign, so the comparison does not stand. We issue our own currency, Greece and Ireland do not. - we do not require lower debt to absorb shocks and uncertainty, that's what the government's prudential liquidity plan is all about, and that buffer was created out of thin air, like all non-cash money. - the fact Crown corps are racking up debt, likely without the oversight of parliament, is problematic. It's one thing for the feds to do it, it's another for branches of the government to. - the debt ceiling is self-imposed and completely irrelevant, just like the US we'll likely raise it time and again. Alot of this stems from more money going out of the system than coming back in via taxes, due to massive tax evasion and avoidance. But also it stems from four decades of banking deregulation and neoliberal government policies to starve the public sector in order to enrich the private sector, systematically slicing away our social safety net and eroding services to the point the public will clamour for privatization. This is neoliberalism as its finest.