Financial Restructuring: Implications of Recent Canadian Macroeconomic Developments

For most of the last 15 years, Canada’s federal governments have boasted of their fiscal rectitude in achieving balanced budgets. This came with a steep price, as progressive critics have shown: lower actual and potential public expenditures are linked to mounting social deficits in the form of hunger, poverty, inadequate housing, environmental degradation, and so on. In an illuminating analysis of the flows between the corporate sector, the household sector, and the consolidated government sector of the Canadian economy, Fletcher Baragar and Mario Seccareccia push the analysis even further, demonstrating that governments’ recent fiscal “success story” simply transformed “overhanging federal and provincial debt (...) into exploding household (and municipal) debt — debt that is traded in increasingly turbulent and unstable financial markets internationally.”