Cutting back so we can spend more

Brian
Brian Jones
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I’ve decided to buy that truck I want. I don’t need it, and I can’t really afford it, but I’ve lusted after it long enough.

I’m well aware that purchasing it will be irresponsible and selfish. But I’ve learned a lot the past few months by watching Premier Kathy Dunderdale and Finance Minister Jerome Kennedy.

No, I’m not going to use your money to buy my new truck, much as I might like to.

Instead, I’ll follow the example of the government, and make use of multigenerational financing.

Most car loans are for four, five or six years.

I’m looking for a dealership that will give me a 20-year loan.

I’ll make payments for the first 10 years, and my two sons will make payments for the final 10.

They’ll be old enough by then, and have incomes of their own.

It’s the least they can do for all the rides they are given to school, to hockey, to their friends’ houses, to the mall.

Some might be revolted by this strategy. It may seem similar to the backward and unjust practice in some cultures of passing debts from father to son to grandson until they are paid, so debts actually outlive debtors.

This will apply to Dunderdale and Kennedy’s 50-year scheme for the Muskrat Falls project, but it won’t apply to my truck.

I plan to still be alive 20 years from now, even if the truck probably won’t be.

But simply passing my debt on to my sons won’t be enough to pay for my new truck. After all, biweekly payments will be due soon after I bring it home.

Again, learning from the premier and finance minister, I’ve decided to make some cuts. The boys won’t like these cutbacks, but as the person in charge of the money, I realize cuts have to be made and, like Kennedy, I’ve made some tough decisions.

They can keep their hockey, but there will be no more allowances — or “weekly funds” as we call them, allowances being for little kids.

They won’t get severance pay, but their savings should get them through the next six months or so.

After that, they’re on their own. They won’t like it one bit, but, luckily for me, they aren’t unionized.

Cutting their weekly funds will account for only a portion of my biweekly truck payments, so I’ve decided in institute a fee schedule for services.

Want a ride to school? That’ll be $5 for gas. Want a ride to the mall? That will be $10.

There will be objections, of course. It will be pointed out that it’s extremely unfair to make such cutbacks in household spending while I’m driving around in a new truck. It will be stated, quite logically and quite rightly, that if I can’t purchase a truck without implementing such serious cutbacks, I shouldn’t buy the thing. It will be said, accurately, that spending and cutting at the same time makes no sense, and is contradictory and hypocritical.

All these arguments, although valid, ignore the essential and most important fact: I want a truck.

It might seem a stretch to compare a truck to a hydroelectric dam, and to compare a household budget to a provincial budget. But certain economic principles apply to both. Here’s one: a dollar spent on Item A is no longer available to be spent on Item B.

So, at the same time that Dunderdale and Kennedy made layoffs and cut spending on health care, education and the justice system, they set aside $386 million this year for Muskrat Falls.

At least when I recognize my mistake, I’ll be able to sell the truck.

Brian Jones is a desk editor at  The Telegram. He can be reached at bjones@thetelegram.com

Organizations: The Telegram

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Recent comments

  • John
    April 06, 2013 - 13:57

    Unfortunately your comparison doesn't work, unless your truck could only be bought for $400,000 and would last 100 years. That would be comparable to the investment in Muskrat Falls, and yes, would need to be a long term investment.

  • mom
    April 05, 2013 - 20:51

    Great analogy! I would appreciate it if anyone can answer this. If we took the power from upper Churchill, when it comes back to us, would it be enough to provide power for all the province? If so, would it be less costly to use this power and run a line to the island than the cost of developing Muskrat Falls?

  • NL TURF
    April 05, 2013 - 20:34

    Great analogy Mr. Jones. Had a laugh reading your column.Entertaining for sure!!. And then again ,not far from the truth!!

  • Cyril Rogers
    April 05, 2013 - 09:32

    Mr. Jones, your truck analogy captures the essence of this fiasco known as Muskrat Falls. It is only going to get worse as that money pit continues to suck up more and more of the revenue generated by oil. When the cost overruns get to the point that they can't keep up though, they won't be able to "sell" the dam. Then we will see the destructive power of a dam that did not yet give way.

  • Chantal
    April 05, 2013 - 07:21

    I blame your greedy children for your situation. Have you considered sending one out to foster care?

  • Jon Smith
    April 05, 2013 - 06:58

    The saddest part of Muskrat is that in spending an excess of $ 5 billion to go around Quebec and spite them as opposed to going through Quebec cuts off our collective noses to spite our faces. By locking in the captive NL ratepayer, government inflicts higher rates on the ratepayer, denied by legislation the cheaper power generated on the mainland. Joey Smallwood's bad deal which did not cost us anything out of pocket but denied us fair revenues will look pretty good when compared to denying us fair rates by locking us in to a boondoggle where we will pay through the nose while our friends on the mainland once again enjoy the benefits- how more exasperating can it get than that?

  • Maurice E. Adams
    April 05, 2013 - 06:55

    Your comparison is not much of a stretch when compared to the 50 year debt yoke that government and NALCOR is locking around the necks of our children and grandchildren. If Muskrat Falls was truly needed, affordable and a reasonable risk (a true 'investment' in other words) perhaps it could be justified. But it is not needed, not affordable, and too great a risk. PERIOD.