Skip to main content

The Globe and Mail

Flaherty: U.S. should borrow Canadian ideas to make budget deal

Jim Flaherty told a New York audience that he hopes Canada's economic policies will serve as a model for Democrats and Republicans as they work to avoid a year-end fiscal cliff.

In a speech to the Foreign Policy Association, Canada's finance minister expressed hope that with the U.S. election now behind them, politicians of both political stripes in Washington will come together to find a long-term plan to manage government finances.

U.S. President Barack Obama met earlier in the day with Congressional leaders in Washington, with both sides expressing optimism that a deal could be reached in time to avoid the "fiscal cliff" of tax hikes and spending cuts that would otherwise take effect on Jan. 1.

Story continues below advertisement

Mr. Flaherty said the U.S. needs a credible medium-term plan to reduce its fiscal deficit over time and that a political agreement is needed in the short term to provide confidence to financial markets that the economic recovery will continue.

"This is a very serious risk and is not to be taken lightly," Mr. Flaherty later told reporters on a conference call. "It will have rather rapid effects on other economies, including Canada's. We're only in November. Our encouragement to the U.S. authorities has been to deal with it sooner rather than later to avoid slippage not only in the U.S. GDP but slippage in our GDP and that of other countries."

Report an error Licensing Options
About the Author
Parliamentary reporter

A member of the Parliamentary Press Gallery since 1999, Bill Curry worked for The Hill Times and the National Post prior to joining The Globe in Feb. 2005. Originally from North Bay, Ont., Bill reports on a wide range of topics on Parliament Hill, with a focus on finance. More


The Globe invites you to share your views. Please stay on topic and be respectful to everyone. For more information on our commenting policies and how our community-based moderation works, please read our Community Guidelines and our Terms and Conditions.

We’ve made some technical updates to our commenting software. If you are experiencing any issues posting comments, simply log out and log back in.

Discussion loading… ✨