See the problem?

Plus a few things to read

Image: Eugene Manning

There are lots of ways to look at the budget.

The image is called a Sankey chart and it shows money flowing in on the left (revenue) and flowing out on the right. (spending)

This one is for the provincial 2024 budget (cash accounting) and it turned up on Facebook this week in Eugene Manning’s feed.

The neat thing about Sankey charts is the way you can follow the cash right through.

You can see how income relates to outcome.

Like all the provincial government’s tax and fees income, which is all the money it raises out of the provincial economy directly.

$4.3ish billion.

There’s a few bucks from the liquor corporation, the lottery, and some fines and fees.

Then there are two big pots of cash: federal transfers and oil royalties.

And that’s it for actual income of one kind or another. $7.9 billion.

Look on the spending side. $9.9 billion.

Deficit.

But not $160 odd million.

$2.0 billion.

Now look at spending compared to revenue.

Health will eat up every penny of tax income from all sources and a couple of bucks besides.

Federal transfers that should go to health and social services plus a bit of general money (Equalization) really pays the interest on the debt.

Everything that isn’t health and debt comes from borrowing and oil revenues plus a few scraps from gambling, fines, and booze. That’s almost half the budget and it comes from sources the government cannot control. What’s worse, the borrowing makes the debt servicing go up in future years which means there’s less and less for what isn’t health.

Another perspective.

Health alone now costs more than the whole budget 30 years ago. In 1994, the whole provincial budget was $3.2 billion, which would be $6.0 billion today. We are spending $10 billion today. That's almost double in dollars of the same value.

In 2004, health care cost $1.3 billion, which would be $2 billion today. We are spending more than twice that and we are not getting nor will we get any better health care or more care by spending so much.

You want to know how much we as a society value democracy? Look at the cost of the legislature. $35 million. The tiniest amount of all.

Imagine what happens when oil drops again. When borrowing doesn’t cover everything. when federal transfers drop off. Not if. When.

Now think about what happens next. We have fixed expenses. Stuff we have to pay for. Interest on the debt is a fixed expense. On paper, everything else can change. That’s why bond-raters, liars, and other people who don’t give two-scittes for what actually happens here will say we are alright. It’s all good.

Except it isn’t like that. Politically, there isn’t a person in the legislature today who will touch health care ever. What's worse, health care is not just a fixed expense. It’s growing.

Seven out of every 10 dollars the government earns this year goes to debt servicing and health. To pay for roads, schools and everything else, the government decided to keep on a path the politicians *know* the province cannot afford, just like they’ve decided the same thing every single year for at least the last 10 years. And before that they just let spending get as wildly out of control as it is.

You see the problem.

We all do.

So, in the next few weeks, we’ll start talking about some ways to do things differently.

Done it before.

Let’s do it again.