Debt and health care

The fiscal health of the province should not be cured by detrimental changes to the health of Ontarians. The rhetoric of rising health care costs and a population aging ‘crisis’ are a means by government, health service providers, and even the consumer to obscure reality.  The main crisis facing Ontario is a debt crisis. The politics of blame are used by both the government and the healthcare establishment to defend their self-interests. The Ontario government had hoped to grow itself out of deficit by relying on overly optimistic projections for revenue growth. Prior to the fall 2011 election, not one political party had a frank and honest dialogue with the people of Ontario.

Prior to 2003, and aside from a brief time in the late 1990s to 2002, an increasing proportion of Ontario’s Gross Domestic Product (GDP) was spent on servicing the debt. The servicing of this massive governmental debt, caused by the operating deficits of the mid-1970’s to mid-1980’s, caused a diversion of government revenue to pay for debt financing.*  The public debt was so massive that the government had been going further into deficit each year to pay the interest charges.

We should have learned from biblical Joseph even though our Premiers did not have dreams to decipher. We should have kept money back during the years of plenty (2002-2008) for these years of famine. Instead, we ate all the grain and bought even more grain on cheap credit. From 2003-2011, the Ontario government increased spending by almost double the rate of economic growth.  Debt service charges (the annual interest payment on the debt) have remained about $10 billion a year only because interest rates have dropped since 1999. Debt servicing is the province’s third-largest annual expense and one of its fastest growing expenditures. To put it into perspective, the Ontario government almost spends as much on servicing the debt each year as it does on our colleges and universities.

So what do we do now? Increasing the value of our health care spending dollars (of course without increasing risk and while maintaining quality and patient experience) will only get us so far. Unfortunately, ‘bending the cost curve’ in healthcare is not the answer to the grey tsunami that will increase health care utilization in the next decade.

We need to increase our productivity to increase government revenue. If we don’t change soon we won’t be able to sustain even our current system.  We need to increase the productivity of Ontarians so that companies are more successful and Ontarians are better paid. Paid citizens and financial sound corporations contribute to taxation revenue. We need to increase our per capita GDP and lead the country in economic growth once again.

Without the existence of an astronomical debt, the graying of the population and the subsequent increase in resource utilization would not seem so much of a problem. If crises in health care continue to ‘emerge’, there are more likely consequences of a fiscal crisis and not the causes of one. Politicians need to solve the fiscal crisis. Health care providers and government need to address the broad determinants of health. Ontarians need to increase their productivity and take individual responsibility for their health. The true crisis that faces Ontario, the debt crisis, will lead to future, consequential crises in health care which we will not be able to finance out of the public purse.

*Northcott, H. “The Politics of Fiscal Austerity.” Health and Canadian Society 1(2): 347-366.

The comments section is closed.

  • Elizabeth Doyle says:

    Several of the points I would have raised have already been made (and rather uncharitably). I have a few questions based upon other claims you’ve made that haven’t been brought up yet in discussion.

    “The rhetoric of rising health care costs and a population aging ‘crisis’ are a means by government, health service providers, and even the consumer to obscure reality.”
    While it’s true that sensitivity to the bigger picture enables us to situate the issue and identify what contributes to it, it’s also true that it also reveals that there is, in fact, a rapidly aging population of baby boomers. If we had infinite resources then – sure – that wouldn’t be an issue, but that’s rather a moot point. No matter how careful the government had been with spending (and I do agree that it should be taken to task on this) that fact would remain and it becomes compounded by virtue of technological and medical means to extend life indefinitely, past the point of futility even. This very issue is dominating in health economics and health care ethics as I type. You could say it’s very much a part of reality. I’m asking for more clarity, because, as is, it seems that your argument falls prey to exactly what you’re calling government, health care service providers and consumers out on – i.e. it’s incomplete and supported by cherry-picking.

    “Without the existence of an astronomical debt, the graying of the population and the subsequent increase in resource utilization would not seem so much of a problem.”
    Ok – long pause – but this is what we’re left with. Now what? Your solution seems to be increasing productivity, but it’s vaguely outlined, at best, and (as another contributor mentioned) it’s not clear that more productivity translates into more health benefits or greater quality of life. Stress, fatigue, alienation, commodification (of worker and labor alike) and all of the other goodies Marx outlined for us are on the horizon.

  • TapOff says:

    It is a joke because he is only focusing on one side of an equation. He forgets that Since the 1980s the same government has been reducing the tax revenue and increasing the loopholes, tax breaks and sliding the reduction of tax higher income earners and corporations pay to nearly Nothing. This and the ADVERTISEMENT/spin doctoring called NEO-liberalism by lobbying has gutted our social safety net and solid municipal infrastructures.
    This fact and the fact that manufacturing corporations, the support systems and the spinoff business that arises from those has also reduced Ontario’s ability to keep pace. This and poor planning by the government because of the short sighted incentive money from lobbying efforts rather than good social governance has also not allowed our populous to prosper and grow or plan appropriately as in some other similarly populated jurisdictions. See Northern Europe…

  • Ryan Herriot says:

    What does “increased productivity” mean in practical terms, for a typical worker? Because to me it’s a concept that always seems to imply efficiency, as in more labour produced for each person-hour of labour. It strikes me that a lot of things you could do to increase productivity, in this sense, would be detrimental to quality of life. For instance, Americans have greater productivity than Canadians, but they also take less vacation time. Is this what you mean?

  • Bob says:

    Is this a joke article? April fools was over 2 months ago.

    “the government needs to increase the GDP”.

    David, that is like the government asking you to hurry up and find the cure or cancer.

    Ridiculous article.


David M. Kaplan


David M. Kaplan MD, CCFP, MSc (Health Policy) is an academic family physician practising in Toronto. He is an Assistant Professor in the Department of Family & Community Medicine and Joint Centre for Bioethics at the University of Toronto.

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