When this constant churning is combined with volatile price changes, the ongoing costs and probability of a significant miscalculation can be high. The policy-maker’s Hippocratic Oath: first, do no harm One of the most important things that policy-makers can do is to avoid making the situation worse. Helpful lessons can be learned in this regard, by looking at Canada’s experience during the 1970s.
Although every boom and bust is in some way unique, there is sufficient commonality across commodity cycles that this period is still instructive. Fiscal authorities in the 1970s assumed that the commodity boom would last forever, or at least for a very long time.