This Day in History: Former Alberta Premier Ralph Klein was born on this day in 1942. He was one of the most popular Premier's in Alberta and earned the title of King Ralph (and Alberta’s Ronald Reagan) by turning Alberta into an economic powerhouse. He did so by making drastic cuts in government and privatizing government services. Less government always means more freedom. When Klein took office the government there was awash in debt.
"Just one day after assuming the premiership, Mr. Klein cut the size of the cabinet from 26 to 17 ministers, and amalgamated 22 committees into four super-committees. He forced all MLAs and civil servants to take a 5% pay cut...When all was said and done, Mr. Klein had eliminated the deficit, paid off the debt and ushered in a new era of prosperity for the province." Source
The federal government had to do the same in the early 90's to save the country. At the time "Canada suffered a deep recession and teetered on the brink of a debt crisis caused by rising government spending. The Wall Street Journal said that growing debt was making Canada an 'honorary member of the third world' with the 'northern peso' as its currency. But Canada reversed course and cut spending, balanced its budget, and enacted various pro-market reforms." Source
As a result the Canadian economy boomed and unemployment plunged.
History offers us another example of this with the US government 100 years ago. There was a depression in 1920-1921 that sent unemployment up to 12 percent. The government therefore liquidated wasteful uses of capital, government spending was cut, and taxes were reduced. The economy bounced back stronger and we got the roaring 20's.
In contrast, the great depression in the 1930's was marred with endless government intrusions into the economy that only prolonged the misery that everyone felt. When government gets out the way, we all prosper.
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