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The myth of "one-time" spending

Author: John Carpay 2001/05/03
Imagine two employees discussing taxes during their lunch break. The first says, "I'm really annoyed that $500 in taxes was taken off my paycheque." The second replies, "Yes, but you have to remember that $100 of that goes to infrastructure and other 'one-time' spending, so actually you pay only $400 in taxes."

It's true that a portion of Albertans' tax dollars is spent to build new roads, bridges, schools, hospitals, nursing homes, and other things deemed to be "one-time." What's not true is the suggestion that "one-time" spending somehow doesn't really count. That suggestion ignores the reality that every dollar spent by a politician, whether characterized as "one-time" or "ongoing", is a dollar taken from a taxpayer. The taxpayer loses her choice to save, spend or invest her own hard-earned money, or give it to charity.

What makes spending on infrastructure "one-time", compared to "on-going" health and education spending In the case of a new road or bridge, you are left with a permanent benefit. But a life-saving surgery, or the knowledge imparted through a school, also leave a permanent benefit. The distinction is arbitrary. The dollar spent to build a new nursing home is taken from a taxpayer, just like the dollar spent to run our courts, prisons, and social services.

The real question that needs to be addressed is: "What percentage of spending should go to health, education, infrastructure, and other categories " Arbitrarily calling some kinds of spending "one-time" does not help answer that question.

By way of analogy, someone earning $2,500 per month (after taxes) can choose what portion will go to savings, investments, charities, clothing, groceries, rent or mortgage payments and entertainment. Now imagine the following "one-time" spending: a new fridge in 2001, new living room furniture in 2002, a tenth wedding anniversary European vacation in 2003, and new carpets in 2004. These items truly are "one-time" spending, but so what The only real question is: what percentage of the $2,500 should go to each category Calling some of your spending "one-time" may be true, but it's also irrelevant.

The government claims that $3.2 billion of its $20.8 billion is "one-time" spending on infrastructure, energy rebates and emergency farm aid.

How many times have Albertans heard of "one-time" spending If any spending is ever "one-time," why is it 47% higher than seven years ago (That's 47% higher after adjusting for inflation and population growth.)

In 1986-87 Don Getty's government spent $12.7 billion on programs, when Alberta's population was 2.4 million and the dollar was worth 54% more than in 2001. Does it make any real difference today what portion of that $12.7 billion in spending was "one-time" and what portion was "on-going" In the same way, in the future, when people look back at the 2001-02 budget, few people will care what portion of it may have once been characterized as "one-time" spending.

It's true that some spending can be characterized as "one-time." It's also irrelevant. For that reason, Albertans would be better off if "one-time spending" ceased to be part of our political vocabulary.

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