Conservative spending cuts could tip Canada into recession, federal union economists say

The Conservative government could tip Canada into a recession if it reduces federal spending by up to $8 billion, says an analysis by the union representing government economists and social scientists.

Claude Poirier, president of the Canadian Association of Professional Employees, said that if the Conservatives press ahead with spending reductions of $8 billion by 2014-15, Canada’s gross domestic product will fall by more than $10 billion and draw an embattled economy into a recession.

“Either the government isn’t aware of the impact its expenditure reduction program will have and is prepared to risk plunging the country into recession, or the government has not gauged this impact properly and is tinkering with the Canadian economy to satisfy an ideological imperative,” said Poirier.

The results of the spending and operational spending review that will be announced in the upcoming budget have been kept under wraps under the guise of cabinet secrecy. With few details about the cuts, unions and other organizations have been struggling to estimate the job losses and their ripple effect on the Canadian economy.

via Conservative spending cuts could tip Canada into recession, federal union economists say.