Article content continued

To be sure, the current set of projections, like its predecessors, shows deficits declining majestically in later years. But somehow in the here and now they never do. Once upon a time, this was supposed to be owing to a shortfall in revenues, the fruit of the Harper government’s supposed obsession with austerity.

By now this is not even pretended. The last Harper budget projected revenues for the current fiscal year at $326.9 billion, enough for a small surplus. The latest estimate has them at $328.9 billion — yet the deficit stands at $18.1 billion. Even allowing for a couple of billion dollars in accounting adjustments, it’s clear what is going on. These are deficits of choice, not necessity.

The mathematical explanation, then, is simple enough. The policy explanation is harder to come by. If the economy is so strong, why are we still running deficits? The government spin is that the strong economy is because of the deficits — and therefore that deficits cannot be reduced, for fear of weakening it.

You understand. We must run deficits in bad times, to bring on the good times, and we must run deficits in good times, to avoid a return to the bad times. This is how you get $20 billion deficits as far as the eye can see.

Which would be tolerable, were we not in the tenth year of an expansion — at the very height, as that volley of data off the top was meant to show, of the business cycle. If we assume no future recessions ever, no problem. But factor in the growing number of threats to the expansion — ballooning U.S. deficits, rising interest rates, a gathering U.S.-China trade war, the chaos over Brexit — and the folly becomes apparent. Demand stimulus is all very well in bad times; otherwise, governments should make fiscal hay while the sun shines.