Connect with us
[the_ad id="89560"]

Business

Growing the government won’t help Canada’s economy

Published

6 minute read

From the Fraser Institute

By Jake Fuss and Grady Munro and Alex Whalen

Empirical research suggests that economic growth is maximized when the size of government falls between 24 and 32 per cent of GDP. In other words, when governments spend in excess of this range, the economy will not grow as much as it would if government operated within that threshold

Canada is suffering from an economic growth crisis, and governments across the country should reassess their policies. Governments (particularly the federal government) have recently taken a more active role in the economy through increased spending and bureaucracy. However, policymakers must take a step back and recognize that growing government doesn’t lead to growth in the economy.

Canada’s economy has been stagnant for the last decade. From 2013 to 2022, per-person GDP (a broad measure of living standards) grew at its slowest pace since the 1930s, after accounting for inflation. And more recent data shows that in the fourth quarter of 2023, per-person GDP (inflation-adjusted) stood at $58,111—which is $51 per person lower than it was at the end of 2014. Simply put, Canadians have experienced a decade of dismal growth, and are now actually worse off than they were a decade ago.

During this time, many governments in Canada have adopted an approach of greater involvement in the economy and significantly higher spending. Take the federal government, for example.

Since 2014/15, the government has increased annual program spending (total spending minus debt interest) by roughly 75 per cent, from $256.3 billion to $448.2 billion in 2022/23. Moreover, the Trudeau government has recorded the five-highest years of federal spending in Canadian history, after accounting for population growth and inflation. Much of this spending has gone towards expanding  Ottawa’s role in the economy through increased transfers, business subsidies or new programs such as $10-a-day daycare and national dental care.

Provincial governments in QuebecNova Scotia and British Columbia (to name a few) have also recently reached historical highs in per-person program spending (even after excluding COVID-related spending). Simply put, governments across the country have been increasing spending and becoming more involved in the economy.

One way to measure the size of government, that allows for the comparison of jurisdictions over time, is known as total consolidated government spending as a share of GDP. This measure includes all spending at the local, provincial and federal levels in a jurisdiction and compares that level to the size of the economy.

According to a recent study, in 2022 (the latest year of available data) the size of government in Canada was 40.5 per cent of GDP compared to 38.2 per cent in 2014.

Among the provinces, total government spending ranged from 26.8 per cent of GDP in Alberta to 63.0 per cent of GDP in Nova Scotia. Compared to 2014, the size of government grew in eight of 10 provinces—only Prince Edward Island and B.C. experienced declines in government spending as a share of the economy. It’s also important to note that this is simply government spending. The true size of government, when accounting for things like regulation, is even larger.

Growing government matters because it influences economic growth. When the size of government is below a certain level, it lacks the resources to deliver services such as policing, courts or national defence—which are essential to a functioning economy. On the other hand, when government is too big it engages in activities best left to the free market and effectively crowds-out private-sector activity that contributes to economic growth. Therefore, when a government is too small or too big, economic growth (and consequently living standards) suffer.

Empirical research suggests that economic growth is maximized when the size of government falls between 24 and 32 per cent of GDP. In other words, when governments spend in excess of this range, the economy will not grow as much as it would if government operated within that threshold—all else equal. Based on the numbers presented above, it’s clear the vast majority of governments in Canada are too big. For nine of 10 provinces and the federal government, their spending exceeded 32 per cent of GDP in 2022.

As Canadians look for solutions to address a stagnating economy and falling living standards, governments should recognize that taking a more active role in the economy won’t solve the problem—and will likely make it worse.

Business

Canada has given $109 million to Communist China for ‘sustainable development’ since 2015

Published on

From LifeSiteNews

By Anthony Murdoch

A briefing note showed Canadian aid has gone to ‘key foreign policy priorities in China, including human rights, gender equality, sustainable development, and climate change.’

A federal briefing note disclosed that well over $100 million has been provided to the Communist Chinese government in so-called “foreign aid” to promote “sustainable development” that includes woke ideology such as gender equality.

As reported by Blacklock’s Reporter, a recent briefing note titled Assistance to China from May for the Minister of International Development showed $109 million has gone to “key foreign policy priorities in China, including human rights, gender equality, sustainable development, and climate change” since 2015 and $645 million since 2003.

The briefing note asked directly if funding was “going to the Government of China.”

In reply, the briefing note stated, “Canada has not provided direct bilateral assistance to Chinese state authorities since 2013, though it continues to provide small amounts of funding to international partners and non-state partners on the ground.”

Former Prime Minister Justin Trudeau came to power in 2015 and increased relations with the Communist Chinese regime. This trend under the Liberal Party government has continued with Prime Minister Mark Carney.

During a 2025 federal election campaign debate, Conservative Party leader Pierre Poilievre called out Carney for his ties to Communist China.

Conservative MP Andrew Scheer has consistently called out any money at all going to China, saying, “I don’t believe Canadian taxpayers should be sending any money to China.”

“We’re talking about a Communist dictatorial government that abuses human rights, quashes freedoms, violates rights of its citizens, and has a very aggressive foreign policy throughout the region,” he noted.

Scheer added that he has been calling on the Carney Liberals to “stand up for themselves, stand up for Canadians, stop being bullied and pushed around on the world stage, especially by China.”

Other countries have received millions of dollars in foreign aid, with $2.1 billion going to Ukraine, $195 million to Ethiopia, $172 million to Haiti, and $151 million to the West Bank and Gaza last year.

Foreign aid to all nations totaled $12.3 billion.

LifeSiteNews recently reported that the Canadian Liberal government gave millions in aid to Chinese universities.

China has been accused of direct election meddling in Canada, as reported by LifeSiteNews.

LifeSiteNews also reported that a new exposé by investigative journalist Sam Cooper has claimed there is compelling evidence that Carney and Trudeau are/were strongly influenced by an “elite network” of foreign actors, including those with ties to China and the World Economic Forum.

Continue Reading

Business

Canada’s combative trade tactics are backfiring

Published on

This article supplied by Troy Media.

Troy MediaBy Sylvain Charlebois

 

Defiant messaging may play well at home, but abroad it fuels mistrust, higher tariffs and a steady erosion of Canada’s agri-food exports

The real threat to Canadian exporters isn’t U.S. President Donald Trump’s tariffs, it’s Ottawa and Queen’s Park’s reckless diplomacy.

The latest tariff hike, whether triggered by Ontario’s anti-tariff ad campaign or not, is only a symptom. The deeper problem is Canada’s escalating loss of credibility at the trade table. Washington’s move to raise duties from 35 per cent to 45 per cent on nonCUSMA imports (goods not covered under the Canada-United States-Mexico Agreement, the successor to NAFTA) reflects a diplomatic climate that is quickly souring, with very real consequences for Canadian exporters.

Some analysts argue that a 10-point tariff increase is inconsequential. It is not. The issue isn’t just what is being tariffed; it is the tone of the relationship. Canada is increasingly seen as erratic and reactive, negotiating from emotion rather than strategy. That kind of reputation is dangerous when dealing with the U.S., which remains Canada’s most important trade partner by a wide margin.

Ontario Premier Doug Ford’s stand up to America messaging, complete with a nostalgic Ronald Reagan cameo, may have been rooted in genuine conviction. Many Canadians share his instinct to defend the country’s interests with bold language. But in diplomacy, tone often outweighs intent. What plays well domestically can sound defiant abroad, and the consequences are already being felt in boardrooms and warehouses across the country.

Ford’s public criticisms of companies such as Crown Royal, accused of abandoning Ontario, and Stellantis, which recently announced it will shift production of its Jeep Compass from Brampton to Illinois as part of a US$13 billion U.S. investment, may appeal to voters who like to see politicians get tough. But those theatrics reinforce the impression that Canada is hostile to
international investors. At a time when global capital can move freely, that perception is damaging. Collaboration, not confrontation, is what’s needed most to secure investment in Canada’s economy.

Such rhetoric fuels uncertainty on both sides of the border. The results are clear: higher tariffs, weaker investor confidence and American partners quietly pivoting away from Canadian suppliers.

Many Canadian food exporters are already losing U.S. accounts, not because of trade rules but because of eroding trust. Executives in the agri-food sector are beginning to wonder whether Canada can still be counted on as a reliable partner, and some have already shifted contracts southward.

Ford’s political campaigns may win applause locally, but Washington’s retaliatory measures do not distinguish between provinces. They hit all exporters, including Canada’s food manufacturers that rely heavily on the U.S. market, which purchases more than half of Canada’s agri-food exports. That means farmers, processors and transportation companies across the country are caught in the crossfire.

Those who believe the new 45 per cent rate will have little effect are mistaken. Some Canadian importers now face steeper duties than competitors in Vietnam, Laos or even Myanmar. And while tariffs matter, perception matters more. Right now, the optics for Canada’s agri-food sector are poor, and once confidence is lost, it is difficult to regain.

While many Canadians dismiss Trump as unpredictable, the deeper question is what happened to Canada’s once-cohesive Team Canada approach to trade. The agri-food industry depends on stability and predictability. Alienating our largest customer, representing 34 per cent of the global consumer market and millions of Canadian jobs tied to trade, is not just short-sighted, it’s economically reckless.

There is no trade war. What we are witnessing is an American recalibration of domestic fiscal policy with global consequences. Canada must adapt with prudence, not posturing.

The lesson is simple: reckless rhetoric is costing Canada far more than tariffs. It’s time to change course, especially at Queen’s Park.

Dr. Sylvain Charlebois is a Canadian professor and researcher in food distribution and policy. He is senior director of the Agri-Food Analytics Lab at Dalhousie University and co-host of The Food Professor Podcast. He is frequently cited in the media for his insights on food prices, agricultural trends, and the global food supply chain

Troy Media empowers Canadian community news outlets by providing independent, insightful analysis and commentary. Our mission is to support local media in helping Canadians stay informed and engaged by delivering reliable content that strengthens community connections and deepens understanding across the country

Continue Reading

Trending

X