What is debt? It’s money that our government owes. And to whom does the government owe this money to? Well to be honest, about 3/4’s of it is owed to Canadian Citizens. This is owed via Canada Savings Bonds, T-Bills or other financial vehicles. This means that about a quarter of the debt is owed to foreign entities and investors.
So when the debt is paid down, the government is giving us double the bonus.
1) They are paying back debt owed directly to citizen’s
2) They are reducing the amount of interest we pay to service the debt.
This 13.2 Billion paydown at a modest 4% interest rate means that our interest will drop by about a half billion a year. That means 500 Million more dollars to put towards social programs, tax cuts, new equipment for the military or paying down the debt even further next year, etc. Whatever the government decides to do, the bottom line is that this payment of the surplus directly to the debt will make each yar better and better for Canadians.
I just have to say “Bravo!!”