Sunday, October 17

GOLDSTEIN: Trudeau’s Pandemic Spending Means Perpetual Red Ink – Report

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Prime Minister Justin Trudeau’s massive public spending, even after the COVID-19 pandemic ends, will make it nearly impossible for future governments to return to a balanced budget, according to a new study from the Fraser Institute.

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The fiscally conservative think tank study – Prime Ministers and Government Spending, 2021 Updated Edition – says federal program spending in 2020-21, the first year of the pandemic, soared to $ 17,121 per person, adjusted for inflation, “by far the highest level in Canadian history.”

Spending in the current fiscal year 2021-22 is estimated at $ 13,032 to $ 13,735 per person, which would be the second highest level in Canadian history, 42.4% to 50% higher than during the global recession of 2009 and 64.8% to 73.7% higher. than at the peak of WWII.

Although program spending per person is projected to decline in 2022-23 to between $ 10,846 and $ 11,446, this would still be between 12.2% and 18.4% higher than in 2019-20, the highest level of government spending before the COVID-19 pandemic. .

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The study also says that Trudeau is on track to record the five highest levels of government spending per person in Canadian history for 2018, 2019, 2020, 2021 and 2022.

“These levels of spending are unprecedented in Canadian history, even compared to other times of crisis such as recessions and wartime,” said study author Jake Fuss, a senior economist at the Fraser Institute.

“By all indications, the new normal level of federal program spending is substantially higher than even the record levels of spending we saw before COVID.

“This high level of deficit-funded spending will eventually have to be reimbursed and that will have implications for future taxpayers who will face tax increases to pay for today’s spending.”

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Fuss’s estimates of government spending per person for 2021-22 and 2022-23 are based on the Liberal and NDP platforms in recent federal elections.

Their low-end estimates are based on the Liberal platform and the high-end estimates on that of the NDP, “given the high probability that these two parties will work together in the minority government,” as together they control the majority of seats. . in the House of Commons.

The study also projects that Trudeau will record the highest average annual increase in public spending per person of any prime minister since World War II of between 11.7% and 12.4%.

In descending order of Trudeau are Louis St. Laurent (7.0%); Lester Pearson (5.2%); Pierre Trudeau (4.1%); Paul Martin (2.6%); Stephen Harper (1.4%); John Diefenbaker (1.1%); Jean Chretien (- 0.3%); Brian Mulroney (- 0.3%) and Joe Clark (- 4.8%).

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The Trudeau government has said it needed to dramatically increase public spending to support workers, families and businesses through the unprecedented economic recession caused by the COVID-19 pandemic, and to position Canada so that the economy could recover strongly in the post. -pandemic period.

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He also said that Canada’s current large deficit and debt levels caused by that spending are manageable due to low interest rates.

Last week, Statistics Canada reported that the economy added 157,100 jobs in September, reducing the unemployment rate to 6.9% from 7.1% and restoring the labor market to pre-pandemic levels.

Finally, it should be noted that governments today provide many more public services than in previous decades, one of many examples being that during World War II, Canada did not have a medicare program.

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Reference-torontosun.com

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