USA - CBO Director Warns of 'Fiscal Crisis'... - Meanwhile - Canadian Gov't Set to Balance Budget... -
Canada's Conservative government looks set to comfortably balance its books in 2015 or even sooner, its latest budget showed on Tuesday, with cuts in spending on the public service more than offsetting a series of modest new expenditures.
The low-key spending plan leaves Prime Minister Stephen Harper well-positioned to offer tax breaks and other initiatives in the runup to an election scheduled for October next year.
"Some people will say this budget is boring," Finance Minister Jim Flaherty told reporters ahead of the budget speech. "Boring is good."
The budget shows a deficit of C$2.9 billion ($2.63 billion)in the 2014-15 fiscal year, up from the previous estimate of C$5.5 billion. That balance includes a C$3 billion contingency fund, which in fact reveals an underlying surplus that year.
Flaherty acknowledged the budget would be narrowly balanced this coming year without the contingency fund, but said he preferred to have a "nice clean surplus next year".
Meanwhile in the USA -
On the same day House Speaker John Boehner said he would bring a "clean" debt ceiling bill to the House floor -- and join Democrats in voting for a 13-month extension of the debt limit -- the head of the Congressional Budget Office declared that the "large and growing federal debt" could eventually increase the risk of a "fiscal crisis."
"The large budget deficits recorded in recent years have substantially increased federal debt, and the amount of debt relative to the size of the economy is now very
high by historical standards," Elmendorf told the Senate Budget Committee.
"CBO estimates that federal debt held by the public will equal 74 percent of GDP at the end of this year and 79 percent in 2024 (the end of the current 10-year projection period). Such large and growing federal debt could have serious negative consequences, including restraining economic growth in the long term, giving policymakers less flexibility to respond to unexpected challenges, and eventually increasing the risk of a fiscal crisis (in which investors would demand high interest rates to buy the government’s debt).
Read more -
Canada's Conservative government looks set to comfortably balance its books in 2015 or even sooner, its latest budget showed on Tuesday, with cuts in spending on the public service more than offsetting a series of modest new expenditures.
The low-key spending plan leaves Prime Minister Stephen Harper well-positioned to offer tax breaks and other initiatives in the runup to an election scheduled for October next year.
"Some people will say this budget is boring," Finance Minister Jim Flaherty told reporters ahead of the budget speech. "Boring is good."
The budget shows a deficit of C$2.9 billion ($2.63 billion)in the 2014-15 fiscal year, up from the previous estimate of C$5.5 billion. That balance includes a C$3 billion contingency fund, which in fact reveals an underlying surplus that year.
Flaherty acknowledged the budget would be narrowly balanced this coming year without the contingency fund, but said he preferred to have a "nice clean surplus next year".
Meanwhile in the USA -
On the same day House Speaker John Boehner said he would bring a "clean" debt ceiling bill to the House floor -- and join Democrats in voting for a 13-month extension of the debt limit -- the head of the Congressional Budget Office declared that the "large and growing federal debt" could eventually increase the risk of a "fiscal crisis."
"The large budget deficits recorded in recent years have substantially increased federal debt, and the amount of debt relative to the size of the economy is now very
high by historical standards," Elmendorf told the Senate Budget Committee.
"CBO estimates that federal debt held by the public will equal 74 percent of GDP at the end of this year and 79 percent in 2024 (the end of the current 10-year projection period). Such large and growing federal debt could have serious negative consequences, including restraining economic growth in the long term, giving policymakers less flexibility to respond to unexpected challenges, and eventually increasing the risk of a fiscal crisis (in which investors would demand high interest rates to buy the government’s debt).
Read more -
http://news.yahoo.com/canadian-government-set-comfortably-balance-budget-2015-211839820--sector.html
http://cnsnews.com/news/article/susan-jones/cbo-director-large-and-growing-federal-debt-could-produce-fiscal-crisis
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