Walk a Kb or Two in my Moccasins- Nobody 'splained it to me like that!

Simple answers to Complex Questions and Complex Answers to Simple Questions. In real life, I'm a Greater-Toronto (Canada) Realtor with RE/MAX Hallmark Realty Ltd, Brokerage. I first joined RE/MAX in 1983 and was first Registered to Trade in Real Estate in Ontario in 1974. Formerly known as "Two-Finger Ramblings of a Forensic Acuitant turned Community Synthesizer"

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Thursday, March 24, 2011

Auditor General Blows lid of Budgetting Process - but it's the 1993 Aud-Gen report

Para 5.41 from 1993 Aud Gen Report

which is incorpoarted into the note below too

The Fiscal Monitor - January 2011

Interest-bearing debt now only $791.757 Billion
at 33million population that's just 23,992.63 each!
---if we each pay an extra $1000/yr for 25 yrs it's done!!
**(although only 1/2 that number are taxfilers)
so I guess it's more than $2000 each
**(although ~40% of taxfilers don't pay any tax)
so I guess it's closer to $3,000 each taxPAYER for 25 yrs ..... I hope I live that long
PS probably about an additional 40-60% of that $3,000 sum to similarly-handle the Provincial equivalent debt-loads.
Wait a second...... $4,200 to $4,800 EXTRA per year for 25yrs!!!!
Who's kidding who here .... that's NOT gonna happen!
 (correct!  pls see Q4 c) below)
What exactly was it we "bought on credit" that we got in exchange for that debt?
ie what types of "investment/consumption" spending comprises the debt?
i) recent bailouts- say $100-150 Billion
ii) old borrowings to cover deficits from 1960-70-80's maybe about $1-10 Billion
(in 1991-2 it was only $37 billion Para 5.41 from 1993 Aud Gen Report and we've run many surpluses since then)
iii) interest on interest -- the balance ---~$792bn less 150bn less 10bn = $632billion
OH MY!!! that's a lot of money ..... for nothing. or nothing tangible ... we cannot say we bought a fleet of ships or built all these cities or waterways or something ...can we?
NB -- Don't forget the non-financial assets (also on table 6) of $63.6 bn and the Financial Assets of $291.8 bn .... (unless the Financial Assets are just double entry Accounting)
So lets subtract theb ~$632 bn less $63.6 bn  less $291.8 bn = $276.6 bn for absolutely sure with nothing to show for it?
Q1 - How is it financed?
Q2 - What rates are being paid?
Q3 - Why do the Federal Pension Funds get paid such a premium? 6.7% in 2010 , 7.1% in 2009 see 2nd-last para on pg 6.18 -Volume 1 of 2010 Public Accounts
Q4 -What is the debt retirement plan for that sum?
-a) sinking fund over 15-25yrs?
-b) amortized bonds?
-c) devalue the currency so that the debt-sum looks smaller as a % of revenue and GDP?
Unspoken official answer c)

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