Economy
Prime minister and premier combine to reduce living standards in B.C.
![](https://www.todayville.com/calgary/wp-content/uploads/sites/6/2024/07/tvrd-fi-trudeau-eby-image-2024-07-15.jpg)
From the Fraser Institute
By Jake Fuss
In B.C., the Eby government is following the prime minister’s lead. After nearly two decades of spending restraint (1999/00 to 2016/17), the province has experienced an explosion in government spending. Program spending will increase from $46.1 billion in 2016-17 to a projected $85.3 billion this year, a nominal increase of more than 85 per cent.
Recently, Prime Minister Justin Trudeau and Premier David Eby had a tête-à-tête and vowed to always “work together on important issues.” While they belong to two different political parties, their visions rely on a larger role for government, which includes more spending, regulation, borrowing and higher taxes. Unsurprisingly, this economic strategy hasn’t worked and has instead led to stagnant living standards in British Columbia and across Canada.
Under the NDP, British Columbians have seen their incomes completely stagnate. B.C.’s per-person GDP, a broad measure of living standards, is expected to be lower this year than in 2018, and decline by an average annual rate of 0.9 per cent from 2022 to 2024—the third biggest drop among the provinces during this period.
This represents a marked departure from the economic results under the previous government. From 2001 to 2017, per-person GDP grew (on average) by 1.4 per cent. And the average British Columbian’s income increased by 27 per cent over these 16 years.
The decline in living standards is also occurring nationally. Canada’s per-person GDP was lower at the end of 2023 than it was in 2014.
Why?
Since first elected in 2015, Prime Minister Trudeau has greatly expanded the federal government’s role in the Canadian economy. Federal program spending (total spending excluding debt interest costs) will increase from $256.2 billion in the final full year of the Harper government to a projected $483.6 billion in 2024-25, an increase of nearly 90 per cent over a decade. The government has financed this spending surge through tax increases and borrowing.
Specifically, the Trudeau government in 2016 raised the top personal income tax rate (which applies to many entrepreneurs and businessowners) and also opaquely increased taxes on middle-income Canadians by eliminating several tax credits (as a result, 86 per cent of middle-income families now pay higher taxes). Federal debt has spiked considerably to finance the government’s insatiable appetite for spending, reaching nearly $2.1 trillion this year, almost double the level in 2014-15.
In B.C., the Eby government is following the prime minister’s lead. After nearly two decades of spending restraint (1999/00 to 2016/17), the province has experienced an explosion in government spending. Program spending will increase from $46.1 billion in 2016-17 to a projected $85.3 billion this year, a nominal increase of more than 85 per cent.
With Premier Eby’s plan to ramp up spending further in the next few years and incur substantial deficits, B.C.’s net government debt is projected to reach a whopping $128.8 billion by 2026/27—a 227 per cent increase since 2016-17.
The B.C. NDP has also raised one tax after another to feed its appetite for spending. The government hiked personal income tax rates from 14.7 per cent to 16.8 per cent on income between roughly $181,000 and $253,000, and introduced a new top tax rate of 20.5 per cent for top-income earners. And raised the business tax rate from 11.0 to 12.0 per cent in 2018, deterring badly needed investment in the province.
Prime Minister Trudeau and Premier Eby are pursuing the same policies and achieving the same miserable economic results. Simply put, the Trudeau-Eby zero economic growth alliance has reduced the living standards of British Columbians and Canadians.
Author:
Economy
Historic decline in Canadian living standards officially reaches five-year mark
![](https://www.todayville.com/calgary/wp-content/uploads/sites/6/2024/04/tvrd-fi-people-taxpayers-canadians-image-2024-04-12.jpg)
From the Fraser Institute
By Jake Fuss and Grady Munro
Indeed, according to a recent study, from the middle of 2019 to the end of 2023, GDP per person fell from $59,905 to $58,134—a 3.0 per cent drop over four and a half years.
On Friday, Statistics Canada released its estimate of gross domestic product (GDP) for the second quarter of 2024, which confirmed that despite growth in the overall economy, individual living standards for Canadians declined once again. As a result, the ongoing decline in Canadian living standards has officially reached the five-year mark.
GDP—the final value of all goods and services produced in the economy and the most widely used measure of overall economic activity—grew by 0.5 per cent from April to June of 2024 (after adjusting for inflation). But while the economy continues to grow in the aggregate, inflation-adjusted GDP per person—a broad measure of individual living standards that adjusts for population—actually fell by 0.1 per cent during the second quarter of 2024, down to $58,005.
In other words, while the overall economy is growing, individual living standards are falling. This apparent disconnect is due to Canada’s growing population, and the fact that the rate of economic growth is not fast enough to account for the amount the population has increased. Specifically, while the economy grew by 0.5 per cent from April to June of 2024, the total population grew by 0.6 per cent (or 242,673 people).
These data confirm that Canadians are still suffering a historic decline in living standards.
Indeed, according to a recent study, from the middle of 2019 to the end of 2023, GDP per person fell from $59,905 to $58,134—a 3.0 per cent drop over four and a half years. This was the second-longest and third-deepest decline in living standards since 1985, and was only exceeded in both respects by a decline that lasted more than five years (from June 1989 to September 1994).
Unfortunately for Canadians, this recent decline in living standards persisted through the first three months of 2024, and now the newest data show the decline has continued into the second quarter of 2024. Therefore, as of June 2024, inflation-adjusted GDP per person stood 3.2 per cent below the level it was in the middle of 2019. Again, despite a few brief quarters of positive per-person economic growth since 2019, the general decline in inflation-adjusted GDP has officially reached the five-year mark.
Due to the continued persistence of weak economic growth combined with remarkable population increases, Canadians have suffered a marked and prolonged decrease in living standards over the last five years. This puts Canada just six months away from experiencing the longest decline in individual living standards of the last 40 years—a milestone no one should be eager to reach.
Authors:
Economy
British Columbia’s finances go from bad to worse during Eby’s first full year
![](https://www.todayville.com/calgary/wp-content/uploads/sites/6/2024/08/tvrd-fi-bc-premier-david-eby-image-2024-08-30.jpg)
From the Fraser Institute
By Tegan Hill and Grady Munro
You might be able to justify higher spending if it improved programs and services for British Columbians—but it hasn’t. In fact, despite substantial increases in spending in recent years, the province’s health-care wait times have increased and student test scores have declined.
The recent move by BC United to suspend its campaign, essentially clearing the way for a two-party race in this fall’s provincial election, made headlines across British Columbia. But another recent event, which failed to garner much media attention, included some jaw-dropping numbers that will impact provincial finances for years to come.
Last week, the Eby government recently released its year-end report for the 2023/24 fiscal year—this government’s first full year in office. Unfortunately for British Columbians, provincial finances went from bad to worse as the government ran a larger-than-projected budget deficit and accumulated significant debt.
First, let’s take a closer look at the government’s budget—David Eby’s first official budget as premier—which projected a $4.2 billion operating deficit for the 2023/24 fiscal year (the government expected to spend $81.2 billion while only bringing in $77.7 billion in total revenues). For context, in its last budget the Horgan government had also planned to run a $4.2 billion deficit in 2023/24, but expected to take in $7.5 billion less in revenues. Put differently, the Eby government could have ran a budget surplus if it stuck to Horgan’s spending plan. Instead, the Eby government chose to spend away that $7.5 billion.
Given that per-person (inflation-adjusted) program spending was already at its highest level since 1965 (the earliest year of available data) under the Horgan government in 2021 (even excluding COVID-related spending), that’s a massive influx of new spending.
Now, the year-end report shows that the Eby government increased spending even further—$3.5 billion more than its original plan in the 2023 budget. Overall, it ran a $5.0 billion operating deficit in 2023/24, despite once again taking in more revenues ($1.9 billion) than it had originally planned. Again, the government chose to spend away every single dollar of extra revenue, and then some.
And the eye-popping deficit is only part of the picture as longer-term spending on things such as schools, highways and bridges, isn’t included. After accounting for long-term spending on capital projects, the B.C. government accumulated $11.3 billion in net debt (total debt minus financial assets) in a single year from 2022/23 to 2023/24. Government debt must ultimately be financed by taxpayers who spent $3.3 billion in debt interest payments in 2023/24. That’s money no longer available for programs such as health care or education.
According to the Eby government, “with a slower world economy and a growing population, we cannot afford to have a deficit of services. When we provide the services and support people need to have a good life, it makes our economy stronger and more resilient.”
You might be able to justify higher spending if it improved programs and services for British Columbians—but it hasn’t. In fact, despite substantial increases in spending in recent years, the province’s health-care wait times have increased and student test scores have declined. Put differently, according to key indicators, B.C.’s performance on health care and education—the two largest areas of government spending—have worsened despite higher spending.
Higher spending also hasn’t paid off for the B.C. economy, which is stagnating. The province’s per-person GDP, a broad measure of living standards, is expected to be lower this year than in 2018. And the Eby government expects negative growth in per-person GDP this fiscal year.
Unfortunately for British Columbians, the latest year-end report on B.C.’s finances shows the Eby government took a bad fiscal situation and made it worse with higher spending and an even larger budget deficit. The next government, whoever that may be, must deal will this fiscal mess.
Authors:
-
Agriculture1 day ago
P&H Group building $241-million flour milling facility in Red Deer County.
-
Censorship Industrial Complex1 day ago
Canada wants to add DEI measures to globalist WHO pandemic treaty
-
Crime2 days ago
Hunter Biden pleads guilty to tax charges, avoids public trial
-
International1 day ago
Telegram founder Pavel Durov criticizes French authorities in first statement after his arrest
-
National1 day ago
Unemployment Surges as Trudeau’s Policies Wreak Havoc on the Economy
-
Brownstone Institute10 hours ago
The Curious Case of Mark Zuckerberg
-
Addictions1 day ago
B.C. addiction centre should not accept drug industry funds
-
Crime2 days ago
Officials Arrest Father Of Suspected Georgia School Shooter