With the recent Bank of Canada rate cut, policymakers have little wiggle room left in the way of monetary policy as a tool for boosting growth. That leaves fiscal policy. Since the Paul Martin days in the 1990s, many Canadian lawmakers and economists have equated sound fiscal policy with balanced budgets. Does this still make sense?
Canadian Business’ Kevin Carmichael argues the preoccupation with balanced budgets is a “dangerous delusion.” Read his editorial here.