Don’t take financial advice from Jerome Kennedy

Brian
Brian Jones
Send to a friend

Send this article to a friend.

If, perchance, you bump into Finance Minister Jerome Kennedy and he offers you financial advice about your spending and saving habits, don’t take it. Politely decline. Impolitely decline. But decline nevertheless.

It’s a funny thing about finance ministers, whether provincial or federal. They display common traits every time they present an annual budget.

First, they lecture condescendingly to the electorate about simple economics.

Then they announce economic policies for an entire province or country that would be illogical and indefensible for a household.

Apparently, the laws of economics are not like the laws of physics. They are not immutable. What is good for a household is not necessarily good for government.

For example, when you sit down to do a family budget to make sure you can afford this year’s vacation in Gander, you wisely make a list of all your income — salary, interest, investments, etc.

With even a cheap calculator, you should be able to estimate your annual income to within $99.99, which you can round up to $100 since the penny is no longer legally worth anything.

If you are an average earner, such an estimate will be off by only 0.2 per cent — plus or minus — of your total income.

Of course, if your spouse or dependent children also work, you may have to boost this margin of error to one per cent to account for the added complexity of your calculations.

Wrong numbers

If you do run into Kennedy, ask him how accurate his revenue calculations were.

If you are already aware of how bad Kennedy’s arithmetic is, ask him, “How could you have been off by $695 million?”

Governance by the Dunderdale administration has gone from bad to worse to atrocious to embarrassing. The government made a dire pronouncement mere weeks ago about an impending budget deficit of $1.6 billion this year, and again next year. (But not the year after that. As many people have already pointed out, the government is — surprise, surprise — forecasting a balanced budget in 2015, an election year.)

Such a deficit is indeed unwelcome news, and the government dutifully warned people that serious cuts in public spending and services — and jobs — would have to be made.

Except that … Kennedy’s deficit projection was off by about 40 per cent.

The $1.6-billion deficit of last week suddenly morphed into a $900-million deficit — before cutbacks — this week, because Kennedy and his bureaucrats were $695 million off in their calculation of revenue from offshore oil royalties, mining taxes, HST and personal and corporate taxes.

Don’t try this at home, folks. If your calculation of household revenue and/or expenditures is off by 40 per cent, you’re headed for chaos and mayhem.

Inaccurate estimates

Certainly, the government’s books are far more complicated than those of any household in my neighbourhood or yours. That’s why the government employs accountants and various other professional bean counters.

So, it comes down to this: if the government’s hired money managers cannot make accurate projections, and might be off by 40 per cent, the government should cease making shrill announcements about impending financial doom.

And that’s not all. This goes beyond mere numbers. The government is making cuts to health care and cuts to education, and is laying off hundreds of public employees and getting rid of additional positions. All this is being done based on a deficit projection that was off by 40 per cent.

Kennedy said these were “tough decisions.” That has become a standard phrase these days. When politicians talk about “tough decisions,” it’s a signal that somebody else is about to get some bad news.

Brian Jones is a desk editor at

The Telegram. He can be reached by

email at bjones@thetelegram.com.

Organizations: The Telegram

Geographic location: Gander

  • 1
  • 2
  • 3
  • 4
  • 5

Thanks for voting!

Top of page

Comments

Comments

Recent comments

  • Corporate Psycho
    March 30, 2013 - 07:07

    Kennedy and other PC members like to hang out at icecap games. I will ask him next game I go to.

  • yo mama
    March 30, 2013 - 06:27

    Rid of all lazy union workers, make it so they have to work to keep their jobs.

  • civil servant
    March 29, 2013 - 18:11

    As is quite apparent... your keen grasp of the obvious albeit truthful and accurate may well keep your from a senior level appointment rubbing shoulders with the ridiculous !!

  • Budget Twitch
    March 29, 2013 - 08:57

    That news would make anyones shoulders shrug.

  • Knewit
    March 28, 2013 - 19:09

    Enjoyed this, thank-you. Everyone with any sense knew he was lying. But bet by 2015 there will still be a deficit.

  • Corporate Psycho
    March 28, 2013 - 18:35

    I wouldn't even take legal advice from this guy. His projections are as bad asT Marshall's .