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The problem with deficits and debt
From the Fraser Institute
By Tegan Hill and Jake Fuss
This fiscal year (2024/25), the federal government and eight out of 10 provinces project a budget deficit, meaning they’re spending more than collecting in revenues. Unfortunately, this trend isn’t new. Many Canadian governments—including the federal government—have routinely ran deficits over the last decade.
But why should Canadians care? If you listen to some politicians (and even some economists), they say deficits—and the debt they produce—are no big deal. But in reality, the consequences of government debt are real and land squarely on everyday Canadians.
Budget deficits, which occur when the government spends more than it collects in revenue over the fiscal year, fuel debt accumulation. For example, since 2015, the federal government’s large and persistent deficits have more than doubled total federal debt, which will reach a projected $2.2 trillion this fiscal year. That has real world consequences. Here are a few of them:
Diverted Program Spending: Just as Canadians must pay interest on their own mortgages or car loans, taxpayers must pay interest on government debt. Each dollar spent paying interest is a dollar diverted from public programs such as health care and education, or potential tax relief. This fiscal year, federal debt interest costs will reach $53.7 billion or $1,301 per Canadian. And that number doesn’t include provincial government debt interest, which varies by province. In Ontario, for example, debt interest costs are projected to be $12.7 billion or $789 per Ontarian.
Higher Taxes in the Future: When governments run deficits, they’re borrowing to pay for today’s spending. But eventually someone (i.e. future generations of Canadians) must pay for this borrowing in the form of higher taxes. For example, if you’re a 16-year-old Canadian in 2025, you’ll pay an estimated $29,663 over your lifetime in additional personal income taxes (that you would otherwise not pay) due to Canada’s ballooning federal debt. By comparison, a 65-year-old will pay an estimated $2,433. Younger Canadians clearly bear a disproportionately large share of the government debt being accumulated currently.
Risks of rising interest rates: When governments run deficits, they increase demand for borrowing. In other words, governments compete with individuals, families and businesses for the savings available for borrowing. In response, interest rates rise, and subsequently, so does the cost of servicing government debt. Of course, the private sector also must pay these higher interest rates, which can reduce the level of private investment in the economy. In other words, private investment that would have occurred no longer does because of higher interest rates, which reduces overall economic growth—the foundation for job-creation and prosperity. Not surprisingly, as government debt has increased, business investment has declined—specifically, business investment per worker fell from $18,363 in 2014 to $14,687 in 2021 (inflation-adjusted).
Risk of Inflation: When governments increase spending, particularly with borrowed money, they add more money to the economy, which can fuel inflation. According to a 2023 report from Scotiabank, government spending contributed significantly to higher interest rates in Canada, accounting for an estimated 42 per cent of the increase in the Bank of Canada’s rate since the first quarter of 2022. As a result, many Canadians have seen the costs of their borrowing—mortgages, car loans, lines of credit—soar in recent years.
Recession Risks: The accumulation of deficits and debt, which do not enhance productivity in the economy, weaken the government’s ability to deal with future challenges including economic downturns because the government has less fiscal capacity available to take on more debt. That’s because during a recession, government spending automatically increases and government revenues decrease, even before policymakers react with any specific measures. For example, as unemployment rises, employment insurance (EI) payments automatically increase, while revenues for EI decrease. Therefore, when a downturn or recession hits, and the government wants to spend even more money beyond these automatic programs, it must go further into debt.
Government debt comes with major consequences for Canadians. To alleviate the pain of government debt on Canadians, our policymakers should work to balance their budgets in 2025.
Tegan Hill
Director, Alberta Policy, Fraser Institute
Jake Fuss
Director, Fiscal Studies, Fraser Institute
Human trafficking suspect arrested in Red Deer, July 2024
From Alert, the Alberta Law Enforcement Response Team
Three human traffickers arrested in Project Endgame
Three men have been arrested and stand accused of running a human trafficking operation that stretched across Canada; operating throughout Alberta, British Columbia, Saskatchewan, and Quebec.
Project Endgame was a year-long investigation led by ALERT’s Human Trafficking unit, and also relied on the assistance of the Edmonton Police Service, RCMP, and the Quebec joint forces Anti-Pimping team known as EILP.
Arrests and search warrants had taken place in Edmonton, Montreal, and Red Deer. A total of 23 charges related to human trafficking offences have been laid against Clyde Elien-Abbot, 31, Kevin Dorcelus-Cetoute, 31, and Jean Rodnil Dubois, 31. Elien-Abbot was arrested on January 31, 2025 in Edmonton, while the other two accused were arrested on July 23, 2024.
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From LifeSiteNews
The Liberals are choosing a new face, but all six contenders seem likely to continue forcing Canadians down the same path as the PM they’re out to replace
With the Liberal leadership election just over a month away on March 9, Canadians are examining the six final contenders and questioning if they will bring change to the Liberal Party or carry on Prime Minister Justin Trudeau’s radical legacy.
The six contenders for Liberal leader and consequently, the next prime minister, are: Mark Carney, Chrystia Freeland, Karina Gould, Jaime Battiste, Frank Baylis and Ruby Dhalla.
While all the above candidates are promising to turn the Liberal Party around, their policies, both past and proposed, suggest little difference from the radical, anti-life and globalist agenda embraced by the Trudeau government.
Former Governor of the Bank of England Mark Carney
Carney appears to be the frontrunner for Liberal Party leader, with many mainstream outlets tacitly promoting him as a solution for Canadians, and numerous MPs having endorsed his campaign.
However, as LifeSiteNews has previously reported, Carney’s history suggests he would be an even more radical version of Trudeau.
While his impressive work experience certainly raises him in the estimation of Canadians, especially compared with Trudeau’s pre-political career as a drama teacher, the former Governor of the Bank of England, like Trudeau, openly supports abortion, the LGBT agenda and many of the tax and fiscal policies of the Trudeau government, such as the carbon tax.
Carney’s endorsement of energy regulations go even further than Trudeau’s, with the candidate having previously blasted the prime minister for exempting home heating oil from the carbon tax.
Carney has also been a longtime supporter of the globalist World Economic Forum, attending their infamous annual conference in Davos, Switzerland as recently as January 2023.
Carney routinely uses social media to advocate for achieving so-called “net-zero” energy goals, and even had his team bar multiple independent journalists from attending the press conference he held to announce his bid for Liberal leader.
Former Deputy Prime Minister Chrystia Freeland
Freeland’s bid for Liberal leader came as a surprise to many as it closely followed her resignation from Trudeau’s cabinet.
Freeland is perhaps best known internationally for her heavy-handed response to anti-mandate Freedom Convoy protesters, which saw the then-finance minister direct financial institutions to freeze the bank accounts of Canadians who participated in or donated to the protest.
Freeland, like Carney, also has extensive ties to the WEF, with her receiving a personal commendation from former WEF leader Klaus Schwab.
Interestingly, at the same time as Freeland announced her Liberal bid, the WEF’s profile on Freeland was taken down from their website. Additionally, the majority of Freeland’s Instagram posts have been removed from public view.
Many have speculated online as to the reason why these actions were taken, with some suggesting that Freeland desires to distance herself from the massively criticized group.
Critics often pointed to Freeland’s association with the group during her tenure as finance minister and deputy prime minister, as she was known for pushing policies endorsed by the globalist organization, such as the carbon tax and online censorship.
Former House Leader MP Karina Gould
Gould, an avid abortion activist, is perhaps best known for telling American women that they can have their abortions in Canada following the Supreme Court of the United States’ overturning of Roe v. Wade in 2022.
Gould is also known for continually advocating in favor of state-funded media, which critics have warned causes supposedly unbiased news outlets into de facto propaganda arms for the state.
In one example from September, Gould directed mainstream media reporters to “scrutinize” Conservative Party leader Pierre Poilievre, who has repeatedly accused government-funded media as being an arm of the Liberals.
Gould also claimed that Poilievre’s promise to defund outlets like the Canadian Broadcasting Corporation would deny Canadians access to important information, ignoring the fact that the Liberals’ own legislation, which she voted for, blocked all access to news content on Facebook and Instagram.
MP Jaime Battiste
Voting records show that in 2021 Battiste opposed a bill aiming to protect unborn children from sex-selective abortions. Later that same month, he voted to pass Bill C-6, which allows parents to be jailed for up to five years for refusing to deny the biological sex of their gender-confused children.
Furthermore, Battiste struck down a motion to condemn incidents of arson and vandalism of churches across Canada. In October 2023, a Conservative MP put forward a motion to denounce the arson and vandalism of 83 Canadian churches, especially those within Indigenous communities.
However, Battiste moved to adjourn the meeting rather than discuss the motion, saying, “I would like to call to adjourn debate on this if that’s what we can do, so we can hear the rest of the study, but if we have to, then I would rather discuss it in camera because it does have a way of triggering a lot of people who went through residential schools and the things they are going through.”
The Liberal government is known to be extremely lenient in their rhetoric when it comes to attacks on Catholic churches, with Trudeau even saying such behavior was “understandable” even if it is “unacceptable and wrong.”
Former MP Frank Baylis
Baylis served as a Liberal MP in 2015 but chose not to seek re-election in 2019. Now, he has thrown his hat in the ring as Liberal leader.
During his time as MP, Baylis was a staunch supporter of abortion. In 2016, he voted against a Conservative bill to provide protection to unborn children and pregnant mothers from violence.
Interestingly, Baylis is the former owner of the Baylis Medical Company of Montréal which was awarded a $282.5 million government contract for now “useless” ventilators during the COVID “pandemic.”
Former MP Ruby Dhalla
Dhalla served in the House of Commons from 2004 to 2011. Interestingly, Dhalla, born to Indian immigrant parents, has promised to deport illegal immigrants and “clamp down on human traffickers.” Dhalla’s stance sets her apart from the other Liberal candidates on the issue.
While Dhalla styles herself as an “outsider,” during her time as an MP, she worked to further abortion in Canada, voting against legislation to protect babies from violence in the womb.
In conclusion
It seems that no matter who is selected as the next leader of the Liberals, the party will remain one which prides itself on being pro-abortion, pro-LGBT, pro-euthanasia and globalist in vision.
While Trudeau may be taking the blame for the current state of the Liberal Party, with these 6 candidates it would appear that the party remains intent on pushing the same policies.
Although it is true that Trudeau’s political blunders, such as his repeated historical use of black-face or his inviting a Nazi-aligned World War II veteran into Parliament, have contributed to his popularity decline, it seems the policies behind the blunders are not his, but the Liberal Party’s itself.
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