COMPAS Poll/Survey

The COMPAS business panel backs John Manley’s open letter to Ontario Minister of Finance on government spending by a huge margin. A near consensus emerges that provincial debtor governments are in serious situations, if not in a crisis, as result of high, rising debt loads. Business leaders and CEOs on the panel perceive the likelihood of future increases in interest rates and the prospect of demographic-driven health cost increases as important risks worsening the situation of provincial debtor governments.

By a 5:1 margin, panelists agree that the fact that Ontario’s debt is larger than California’s is a reason cut the province’s debt load. But they are even more convinced—by a margin of 17:1--that Ontario should take action because Canada’s aging population will accelerate the pressure on health budgets while weakening productivity growth and hence government revenue possibilities.

Only 17% view the situation of debtor provinces as a “crisis” but 97% believe that the situation must be addressed with at least some degree of seriousness. According to at least one panelist, debt is a moving target. “Now the problem is merely serious - wait for six months and do nothing - then it will be a crisis.” According to another, we are “mov[ing] inevitably in the direction of a concrete wall.” “Sooner or later,” says a third, “the chicken [will] come home to roost.”

These are the key findings from this past week’s Internet survey of CEOs and business leaders on the COMPAS panel. The weekly business survey is undertaken for Canadian Business magazine.

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