I had bookmarked an article from the Wall Street Journal's Canadian blog but didn't insert it into my earlier comments about over-reliance on monetary policy but it is very relevant. The WSJ article reads as follows:
Canada’s plan to introduce balanced-budget legislation has some economists saying the country’s central bank may have to adopt an easy monetary policy to offset slower growth as Ottawa pares spending to eliminate deficits.
The proposal for a new law to mandate balanced budgets was unveiled late Wednesday in the Speech from the Throne, a document that lays out the Conservative government’s agenda for the new session of Parliament. Details in the speech were scant, revealing only that the legislation will “require balanced budgets during normal economic times, and concrete...
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Edward Harrison is the founder of Credit Writedowns and a former career diplomat, investment banker and technology executive with over twenty five years of business experience. He has also been a regular economic and financial commentator in print and on television for the past decade. He speaks six languages and reads another five, skills he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College.