Canada's 75 Billion Dollar Bank Bailout
Michel Chossudovsky - Global Research
January 25, 2009
The Conservative government has leaked the details of Tuesday's budget. They have announced a $64 billion deficit.
The Harper government, which has consistently committed itself to a "balanced budget", now claims that deficit spending is required to boost the economy at the height of a major economic recession.
Does this constitute a turnaround in federal government economic policy?
Where is the bulk of the money going? These budget allocations do not explain the dramatic increase in the budget deficit.
Bear in mind that barely a month ago, Finance Minister Jim Flaherty had projected "a $2.3-billion surplus for the current fiscal year" (Edmonton Sun, December 24, 2008)
Canada's Bank Bailout
The 64 billion dollar budget deficit should come as no surprise.
It is directly related to a 75 billion dollar bank bailout program for Canada's chartered banks, announced, virtually unnoticed, four days before the October Federal election.
The bank bailout received close to no media coverage; its budgetary implications were not analyzed.
In a statement by Prime Minister Harper on October 10, the bank bailout was casually presented as a commitment by the Federal government to purchase an initial $25 billion in "secure" bank mortgages from the Canadian chartered banks. The transaction would be implemented through Canada Mortgage and Housing Corp: