Separatist Posturing

The National Post (subscription) and Globe and Mail, among others, are reporting on a PQ study claiming Quebec will be financially better off as a separate nation than within Canada:

The study, released yesterday, was prepared by a team headed by Parti Québécois finance critic François Legault and endorsed by five economists outside the party. The study concluded that if Quebec became a sovereign country today, it would accumulate a $13.8-billion surplus between fiscal years 2005-2006 and 2009-2010.

If, on the other hand, Quebec remains a province of Canada, it will accumulate a $3.3-billion deficit over that period, the study concludes.

“Yeah right,” is the response by everyone except the voodoo economists who authored the report:

In his presentation yesterday, which he called a “very conservative” projection, Mr. Legault said by taking back its federal taxes, Quebec would get $31.6-billion more a year, even after losing $9.6-billion in federal transfers.

But a sovereign Quebec would also have new responsibilities, paying $8-billion a year in Old Age Security pensions, another $5-billion in Employment Insurance benefits, plus another $13-billion for its new responsibilities, including $2-billion for defence.

Quebec generates about 21.2 % of Canada’s wealth, but Mr. Legault assumes a sovereign Quebec would only shoulder 18.2% of the national debt, or $6.4-billion a year in added interest charges.

Meanwhile, Statscan reports Calgarians are the least financially dependent on Canada (National Post: subscription required):

Calgarians received $7.93 from government for every $100 of job earnings. In contrast, the residents of Trois-Rivieres, Que., had the highest “economic dependency” receiving $23.26 from governments for every $100 in employment income. While the decline in “economic dependency” suggests increasing financial self-reliance on the part of Canadians, it also likely reflects the deep cuts in government transfers that occurred in the 1990s.

Just thought I’d provide a bit of context for prognostications about whether Canada is a failed state or people.