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Home > Features > The 2003 Federal Budget: ‘Northern Tiger’ Spends Big |
Northern Tiger
Does Canada’s strong economy justify big spending?
Finance Minister John Manley has coined a new expression for the Canadian economy's
success over the past year or two: the "Northern tiger."
This term is borrowed from the overwhelming success of a number of post-World War II
East Asian economies (namely, Japan, South Korea, Taiwan, Singapore, and Hong Kong).
They were dubbed "Asian tigers" as part of what the World Bank called an ‘economic
miracle.’ The term has since been applied to the Irish economic boom, as the Republic
of Ireland experienced a tremendous growth in wealth as result of their booming technology
sector.
While Canada’s growth has been modest compared to these success stories, there have
been remarkable, sustained growth rates in this country despite economic stagnation
in the United States (Canada’s largest trading partner).
Gross Domestic Product (GDP) is the dollar total of all the final goods and services
output within a nation's boundaries during a year. This means that as the GDP grows,
so does government revenue due to greater incomes and taxable purchases.
Canada’s GDP has grown so fast, that the huge spending increases outlined in the 2003
budget are not only justifiable, but it leaves a surplus and room for a healthy contingency
(i.e. the amount left over in case forecasts change, or unforeseen circumstances arise).
But, Globe and Mail columnist Michael Den Tandt prefers to call Canada a “Northern
poodle.” He argues that such spending - on what he calls “non-essentials” – will slow
economic growth and deviates from the principles that established the Northern tiger
in the first place: lower taxes, and lower spending.
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