Here are some excerpts from then finance minister Paul Martin's budget speech on Feb. 24, 1998:
What I am about to say is something no Canadian government has been able to say for almost 50 years.
We will balance the budget next year.
We will balance the budget the year after that.
And, Mr. Speaker, we will balance the budget this year.
Mr. Speaker, it is clear that a new era lies ahead. And because of that, we owe it to Canadians to repeat what our principles will be as we go forward.
First, we will stay the course that brought us here. We will be frugal. The battle to root out waste and inefficiency can never end.
Never again will we allow the spectre of overspending to haunt this land.
Never again will we let old habits return — of defining bigger government as better government, of believing that every problem requires another program.
And never again will we see Canadians undergo round after round of painful cuts in order to dig us out of yet another hole.
Canadians have paid to see the movie ‘The Deficit'. They don't want to pay to see the sequel.
Today, in Lima, Peru, Prime Minister Stephen Harper told the world that the sequel is comin' to town next spring:
… We did agree at the G20 last week that additional fiscal stimuls should be used to sustain global demand if monetary policy continues to prove to be inadequate.
These are, of course, the classic circumstances under which budgetary deficts are essential.
I say this with some reluctance, in fact, some great reluctance.
We in Canada have had bad experience with deficits.
Federally, 27 straight deficits threatened the very stability of our economy. We worked long and hard to get out of it and to educate the public as to why it was bad.
In my own case, I began my political career, about 20 years ago now, in a fledgling new political party, in part to campaign for the necessity of fixing that structural deficit.
So whatever short-term fiscal stimulus or deficit spending our government pursues, we will ensure that Canada does not return to long-term, structural budgetary deficits.
There are, many experts will tell you, good reasons for the government to return to deficits. One of those experts is Harper himself, who holds a masters degree in economics and, as he said in his speech today, was pursuing a career as a university economist studying economic history and macroeconomic theory when the pursuit of that career was interrupted by his current one:
The world is entering an economic period unlike, and potentially as dangerous as, anything we have faced since 1929. … Let us remember what led to the Great Depression.
It was not caused by a stock market crash. That was only the beginning. Policymakers pursued four sets of actions that defined that terrible decade.
They allowed a rapid contraction of the banking system.
They allowed widespread deflation as a consequence.
They undertook to balance the books at all costs — raising taxes and contracting government economic activity at the one time when fiscal stimulus was absolutely essential.
And, finally, they erected protectionist barriers in a short-sighted attempt to preserve jobs.
These are mistakes the government of Canada will not make.