LeBreton grinning from ear to ear

I suspect that we will get a rousingly good news buffet in tomorrow’s news about the unemployment rate in NB dropping to 7.6%. It certainly is almost without precedent.

But it does very little to change the fundamentals. We are still in population stagnation/decline (depending on the time horizon you use). Our job creation is primarily coming from two sources: call centres and government workers. The former provides very little taxes to the coffers and the latter pulls from those coffers. Many of our blue collar workers are migrating west with the lure of Alberta. We are increasing our dependence on Equalization with every year that passes.

My point is that the low unemployment rate is a distraction. A tool that governments and Samuel LeBreton can use to shield the public from the serious problems facing the economy.

I blogged on this before but it it worth while mentioning that a few years ago Saskatchewan was all in an uproar. Even though they had a 4% unemployment rate and were a “have problem”, the politicians figured out that all of that didn’t mean much if there was no one left to benefit (their population was in decline). So they are now spending millions of dollars on advertising in Alberta and Ontario to attract people to Saskatchewan and more to drive economic development initiatives (biotech, biofuels, etc.).

I’ll give the government credit when:

Our need for Equalization actually starts to decline (it is projected to increase until at least 2011).

Our population starts to increase for at least a couple of years straight.

We start to see some job creation in the $50K/year salary range that are not government jobs (oh, and not private sector jobs funded by the NB government – i.e. the Lepreau refurb).

In other words, when we start turning the ship around.

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0 Responses to LeBreton grinning from ear to ear

  1. NB taxpayer says:

    Very true. And though it goes against all that I preach against daily on my blog (ideologically), I was glad to see both Nova Scotia and Newfoundland fight for the initial Atlantic accord arrangement signed by Martin (and promised by Harper in opposition).

    Why?

    Because provinces like Newfoundland and Nova Scotia have been neglected for so many years, as a result of the fiscal arrangement of Confederation, that declaring themselves a “have province” and weaning off of equalization payments is only the first step in a long road back to economic legitimacy.

    Yes, there is no question that this will spark further complaints lodged from the desk of McGuinty about per capita spending, but let’s get real here folks, exactly what difference is there between the generous off-shore resources arrangement (plus equalization) and the decades of overcompensation of one region [central Canada] via lucrative side-deals? (i.e. DIPP, TPC loans, the aerospace industry and the billateral auto pact arrangement)

    I mean honestly, I wouldn’t want to even warrant a guess at how much those loans and side deal legislation [above] cost not only Canadians taxpayers, but the rest of the country as well.