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DFWCom's avatar

This is a great piece and I appreciate it. I agree, too, it's a pity Canada's 1995 austerity shock isn't better understood, even in Canada.

A good example of what's not well understood is downloading. Cuts by the Federal government were downloaded to Canada's provinces and then to its municipalities. I recently had the opportunity to review my (Ontario) municipality's taxes and they doubled in real terms between 1998 and 2005 and were then launched on a trajectory of consistent 3% growth (again in real terms) - a doubling time of just over 20 years.

The point is the shock upended government services from top to bottom and the effects are still being felt, today, particularly in Canada's health care sector - in my municipality we are heading to 40% of residents not having access to primary care, and affordable housing - the Federal and Provincial governments stopped building.

The point is that "shock therapy" is not something that quickly rebalances - it results in long-term decline.

It's long overdue that somebody does serious research about the effects of austerity - not as a quick fix but as a way of permanently immiserating society.

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Ian Greig's avatar

Such a good response that it has left me with absolutely no desire to read the original piece.

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