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November 28, 2005
Canada's government faces vote of no-confidence
Too much activity around the holiday set me behind on blogging. Time to get back into it.
I thought I'd start by informing you of a rather interesting situation north of the border. Canada's minority Liberal government is expected to get a no-confidence vote as early as tonight. That would mean federal elections in Canada, probably in January. Conservative whip Rob Nicholson tells the Globe and Mail,
"I think there is a little less suspense about the outcome of this but it is historic nonetheless. And you feel the buzz, you feel the excitement in Ottawa today. That something historic is going to happen, that this government is going to be taken down and the Canadians will get an opportunity to change that government. So there is quite a bit of excitement in the air."
If you aren't familiar with the parliamentary system, click on the link to learn more. One of the advantages is the flexibility to call elections at any time through the use of a no-confidence vote. Though our American sensibilities are so accustomed to the 4 year (2 year for Congress) cycle that the thought of having to ramp up the election machinery over the Christmas holiday would seem to be a disadvantage. There are other features of the system that may be positive or negative depending on your perspective as well.
Why does this deserve attention on an economics blog? Because in reading about the coming vote, I noticed some interesting things going on in Canadian fiscal policy. Namely, a lot of spending going on. The Toronto Sun writes,
Let's get a federal election under way before this government of ours has the whole country in the poor house.
The feds are spending money like drunken sailors as they attempt to shore up support and convince Canadians to give them another term in office.
And the Globe and Mail reports the new spending proposals of the last few days. It's a long list.
While I don't follow Canadian politics terribly closely on a daily basis, I try to keep up with the major stories when I can. (More than most Americans, I am quite sure!) It is an intersesting development. Not that different from our own experience. We're all familiar with politicians trying to push spending policies to generate votes. But there does seem to be a different dynamic in the parliamentary system, especially when the ruling Prime Minister does not have a majority.
If indeed the imminent collapse of the government causes a rush of spending, it is worth noting. Just doing a quick search on the political economy of parliamentary systems yields some good papers. One particularly intriguing that I might want to read is titled "The Size and Scope of Government: Comparative Politics with Rational Politicians" by Persson and Tabellini. It is NBER working paper 6848 and published in the European Economic Review in 1999. Comments are open for other papers you might suggest.
UPDATE: Mr. Martin's Liberal government fell in a 171 to 133 vote. Tomorrow, Prime Minister Martin will officially call for elections, most likely to be held on January 23. More from the Globe and Mail. I watched the Liberal and Conservative speeches on C-Span tonight. It's going to be quite a campaign up there.
Posted by William Polley at November 28, 2005 5:09 PM
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