Abstract
Europe’s debt crisis is by no means unique but quite the contrary: Canada had to face a similar challenge during the 1990s. The way this country dealt with the crisis is often presented as a success story. What are the lessons that Europe can learn from Canada’s experience? This article examines the similarities between both crises, explains the main reforms Canada went through and finally analyses the key factors that influenced and enabled this country to overcome the crisis.
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Notes
All the following figures are from [9].
Figures quoted are for the general government sector for all countries which, as the OECD notes, is a consolidation of accounts for central, state and local governments, plus social security.
References to Canadian budget years are to fiscal years, which run between 1 April and 31 March. Thus, a reference to 1993 refers to the period 1 April 1992 to 31 March 1993.
The current forecast from the federal Department of Finance is for Canada to return to a balanced budget by 2015.
All provincial figures are from [1], Tables 17–30.
The Reform Party garnered 52 seats in 1993, just short of the 54 seats won by a Quebec-based separatist party, which led to the separatist party becoming Canada’s official opposition in the federal parliament. The Progressive Conservatives, displaced by the Reform Party, fell to just two seats. The Reform Party would eventually become the official opposition in 1997. The Reform Party in a later incarnation and the Progressive Conservatives merged in 2002 as the Conservative Party of Canada. The Conservatives won power in 2006 under Prime Minister Stephen Harper, who had first been elected to parliament as a Reform MP in 1993.
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Milke, M. Lessons for Europe: how Canada dealt with its own fiscal crisis. European View 10, 231–239 (2011). https://doi.org/10.1007/s12290-011-0174-2
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DOI: https://doi.org/10.1007/s12290-011-0174-2