Hey there, time traveller!
This article was published 19/8/2015 (673 days ago), so information in it may no longer be current.
The Brandon Sun editorial on July 31, “Addressing Manitoba’s Rising Debt” referred to Manitoba’s current debt as $21 billion or 31 per cent of the GDP. It could also have been expressed as about $16,000 per capita.
But does this large sum accurately reflect the amount that Manitobans are on the hook for? It doesn’t include debt of Crown corporations.
For example, we have the monolithic Manitoba Hydro, which is in the midst of spending tens of billions of borrowed dollars, at government behest, for megaprojects that show every indication of becoming giant sink holes.
Manitoba Hydro ratepayers are essentially a subset of Manitoba taxpayers and, if you are both a ratepayer and a taxpayer, it doesn’t matter which hand is in your pocket.
There is also the matter that the Manitoba taxpayer underwrites Manitoba Hydro debt. If Manitoba Hydro makes bad financial decisions that either trigger bankruptcy or cause its privatization, all liabilities fall on the Manitoba taxpayer.
Even Manitoba taxpayers who are not Manitoba Hydro ratepayers have an interest in Manitoba Hydro’s finances, if they are renters whose electricity is paid by their landlord and recovered in rent.
The beauty of a Crown corporation is that it is an asset if it is well run. But it is a liability if it is poorly managed. Right now, we have the latter in Manitoba Hydro.
Hydro debt was more than $14 billion, as of March 31, 2015 — and about to get a lot higher. If we add this $14 billion to the $21 billion, we have $35 billion, which divided by the current Manitoba population, gives us provincial public debt of more than $27,000 per capita.
Manitoba is the nation’s most indebted province, once Manitoba Hydro debt is added to the mix — as it should be under the circumstances. We seem to be on a collision course.