Fraser Institute: B.C. government’s land deals with First Nations threaten its ability to borrow money
Like any borrower, for the provincial government to borrow money there must be an investor willing to lend. The lending side has two groups—bond rating agencies and the actual lenders. Rating agencies analyze the sustainability of government debt to help lenders determine credit worthiness and the level of interest they should charge given the financial strength and creditworthiness of governments.
There are already worrying signs, with five downgrades of B.C.’s provincial debt by rating agencies in recent years. And there’s a real possibility that lenders will be increasingly reluctant—or potentially outright refuse—to provide debt financing to the B.C. government as its debt grows and the reality of bilateral agreements, related court cases and provincial legislation regarding Aboriginal title become clearer. This is not hyperbole. Lenders refused to provide financing to the governments of Nova Scotia and Saskatchewan in the 1990s and to Greece from 2009 to 2018. And in the early 1990s, lenders were increasingly worried about Ottawa’s debt level, causing marked increases in interest rates.
For the B.C. government (and thus, B.C. taxpayers), the financial risks linked with these agreements and court cases could result in marked increases in the interest payments lenders demand to compensate them for increased risks. Indeed, a one-percentage point increase in interest costs on the government’s existing debt would equal roughly an additional $1.9 billion this year alone. That means even more borrowing as the deficit increases.
And Victoria has racked up an almost unimaginable amount of debt in recent years, and the scale of the increase is unprecedented. Coming out of COVID in 2020/21, total provincial government debt stood at $87.1 billion and is expected to reach $183.4 billion this year (2026/27) and $234.6 billion by 2028/29, which is a total increase of 169.3 per cent in just eight years.
Re BC and debt / money …. I have a condo in BC on the ski hill at Fernie.
We have always called BC – Bring Cash because of the level of taxation of every type imaginable. BC is quite the socialist shithole but perfect if you are a queer commie!
The problem is less First Nations and more poor government. This …
“Coming out of COVID in 2020/21, total provincial government debt stood at $87.1 billion and is expected to reach $183.4 billion this year (2026/27) and $234.6 billion by 2028/29, which is a total increase of 169.3 per cent in just eight years.”
Add poor government to giving away your land to First Nations and I’m glad I don’t live in B.C.
Well MMT says more debt just means more money in the system – basically more wealth.
Debt = wealth.
That can’t be anything but good, right Steve?
I have a theory Buddy. I call it “Emptying the Cupboard While the Doors are Open”.
Moron Money Theory is worse than the Half-Keynesianism it replaced.
It’d be a shame if they couldn’t borrow money anymore, eh?
Cryin’ shame.
They’ll just come for your savings er… capital gains.
Err, wealth … in all its forms. Even those rare glass figurines in the menagerie
Oh, they’ll lend all right and at reasonable rates, too. It would be a shame if a bank didn’t and problems developed within the bank.
I would not want to own property in BC now – lots can and will go sideways.
But I also think there is going to be a HUGE “reckoning” for all western governments in the next decade and for the people who have treated their homes as ATM’s.
Understanding this requires a rudimentary understanding of the concept of cause and effect.
So there is no hope.
“Sure we gave half the province to stone age natives who don’t pay taxes and who oppose all economic development that doesn’t include casinos. Why would that affect our credit rating?”
Yes, surreal times.
Have always been curious about the current practice of infinite borrowing and when/if the financiers of infinite borrowing would eventually wake up and wave the red flag.
We are close. It’s about time.
Yes, Eby is the enemy of common sense. He only cares about Feathers and Unions. Both have been overpaid by his commie gov.
Ironically, there are regions that are covered by treaty and your home is safe from the Feathers trying to re-occupy it. One of those regions?
Greater Victoria. The Douglas Treaty signed way back in the day, is legit and makes all homes in Greater Victoria owned Fee Simple, regardless of the occasional nonsense comments.
Ironic.
That said, a POX on the NDP commies for their malfeasant, incompetent ways, and the TWATS that keep voting for reckless commies. A close second the CINO MLAs that continue to discover new ways to lose, being squishy Midwit, devoted to NDP Lite.
It’s called “fee simple” because that’s what you’ll have to pay your lawyer if you want to hold on to it.
The so called civilized western society can’t quite deal with the elephant in the room , that being elections can have severe consequences . The pot heads in B.C. have never understood that concept . The elbows up assholes are no different .
Running out of other people’s money? If only they could get a bigger cut of all the money being laundered in the casinos..
how long before a groundswell of doubt PERMANENTLY hobbles the house mkt given the suspicion is ANY neighborhood *could* be the target of a ‘old treaty surrender’ and THEN, houses in that specific area are unsellable? because of property rights bla bla bla?
who in blazes in their right mind are going to ‘retire on the west coast’ given that THIS has *already happened* as such *other* native bands have ‘tasted blood’ and yo he ho ITS OURS NOW YOU SAID !!!
nutso nutso nutso, but then again, leftoidals are wont to pause and ponder future RAMIFICATIONS of their socialist policies and decisions. and that’s another thing, at this point a lot of what’s ‘left’ (pun intended) for the ‘left’ to do is the really bizarre damaging stuff. taxes taxes taxes is one thing but give it time? ya. BC = ‘bring cash’ at the VERY least. and a lawyer. and a translator. etc etc.
the last (both meanings of the word) time l flew to BC 2007. got in an argument with my brother to the effect, jeepers Tom – l cant even give you a compliment you blow up at me – then later on we’re in port hardy north end of the island, lm talking to Allen across the straight, whom l had advised ‘keep your schedule clear lve got the plane tickets lm coming out in march’. whereupon calling him to arrange a rendezvous, he advises me ‘hes going to seattle to visit friends’.
well, ok bud you do that. then and there it was kcuf ’em. never again. when my dear eldest sister passed away in 2023 that was THE LAST THING that wd have got me out there.
BC? a write off. Canaduh? soon to follow. AB? depends.