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Election year or not, 2024 promises winds of change: Jack Mintz

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From the MacDonald Laurier Institute

By Jack Mintz

Governments are going to have to address sluggish productivity growth. Either that or get turfed at the polls

Last week, I summed up 2023 as a year of poor economic performance, with high interest rates, declining real per capita GDP and shortages of housing and health care. Should we expect more of the same from 2024 or something better and brighter?

Although high interest rates have made headway in controlling inflation, they come at a cost. BMO predicts Canada’s GDP growth will fall to 0.5 per cent (from just one per cent this year) even with continuing high immigration levels. Per capita GDP will thus likely take a hit again, falling by at least two per cent, and the unemployment rate could edge up by a point to 6.4 per cent. That means the “misery index” — the sum of the inflation and unemployment rates — will remain virtually unchanged (9.2 per cent in 2024 vs. 9.3 per cent in 2023).
With the Bank of Canada, like other central banks, focused on its inflation target, the crucial question becomes whether federal and provincial policies switch over to combating weak economic growth and productivity.

In the short term, the Trudeau government seems fixated on new redistributive programs such as denticare and pharmacare, rather than addressing the alarming decline in per capita GDP. Quite the contrary, its primary “growth” policy is to pursue a fast-paced energy transition regardless of the immediate GDP loss. Few plans are in place to improve private investment in innovation and investment, not unless you count extraordinarily reckless auto subsidies. And in Ottawa regulations grow like weeds, slowing the pace of development.

The federal government and most provinces, especially B.C. and Ontario, are facing a surge in deficits without any real plan to improve their own productivity. Working with various governments, I am struck by how far behind the times public-sector technology often is. At a recent meeting in Ottawa, I saw some highly skilled civil servants wrestle with old printers trying to print out materials for review. A friend relates how because of lack of digitization it took a surprisingly long time just to get a list of past property tax payments from the city of Toronto. Few hospitals seem to be spending on new technologies that can process patients more quickly in emergency wards. With such poor technology, governments instead simply add more workers to their bloated bureaucracies.

Maybe 2024 will be the year in which governments finally focus on growth. If they don’t, they may find themselves turfed out at election time. Around the world, 2024 is the year of the election, with the most national elections ever: in 40 countries covering 42 per cent of global GDP. The major ones are in Bangladesh, Belgium, India, Indonesia, Mexico, South Africa, Taiwan, the European Parliament and, of course, the United States. Even some authoritarian governments face their electorates this year, for instance, Iran, Russia and Venezuela.

Many of the genuine elections could have a big impact on geopolitics and the world economy. Paul Singer, founder of Elliott Investment Management, argues that “The world is now completely dependent on the good sense of leaders to avoid an Armageddon.” Stock markets should be priced to reflect this political risk. Political developments could erode global trade and co-operation and aggravate hostilities in Eastern Europe, East Asia and the Middle East.

For Canada, the critical election takes place in the United States. But whoever wins the presidency in November (or later!), we’re likely to be hit by increasing U.S. protectionism. And if U.S. per capita GDP continues to rise faster than ours, as it did over the last decade, we will either find a new economic path or watch skilled workers and business investment literally go south on us.

We aren’t due for an election until 2025 but rumours abound that the Jekyll-and-Hyde NDP will finally act out its criticisms of Liberal policy and pull the plug this year. The Liberals won’t trigger an election if they continue to trail the Conservatives by 10 points or more. But the NDP may figure it can pick up seats, especially in Ontario.

With the winds of change blowing, Canada may see federal and provincial governments try a different approach to economic policy, one focused on economic growth rather than just redistribution. Both levels of government need to address our falling per capita GDP. If they do, Canadians will have something to cheer about by the end of 2024.

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DOGE discovered $330M in Small Business loans awarded to children under 11

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In a bombshell revelation at a White House cabinet meeting, Elon Musk announced that the Department of Government Efficiency (DOGE) had uncovered over $330 million in Small Business Administration (SBA) loans issued to children under the age of 11.

Key Details:

  • Elon Musk stated that DOGE found $330 million in SBA loans given to individuals under the age of 11.
  • The youngest recipient was reportedly just nine months old, receiving a $100,000 loan.
  • SBA has now paused the direct loan process for individuals under 18 and over 120 years old.

Diving Deeper:

At a cabinet meeting held Monday at the White House, President Donald Trump and Elon Musk detailed a staggering example of federal waste  uncovered by the newly-formed Department of Government Efficiency. Speaking directly to ongoing efforts to eliminate corruption and abuse in federal agencies, Musk explained that the SBA had awarded hundreds of millions in loans to children—some of whom were still in diapers.

“A case of fraud was with the Small Business Administration, where they were handing out loans — $330 million worth of loans to people under the age of 11,” Musk said. “I think the youngest, Kelly, was a nine-month year old who got a $100,000 loan. That’s a very precocious baby we’re talking about here.”

DOGE’s findings forced the SBA to abruptly change its loan procedures. In a post on X, the department revealed it would now require applicants to include their date of birth and was halting direct loans to those under 18 and above 120 years old. Musk commented sarcastically: “No more loans to babies or people too old to be alive.”

The discovery was just the latest in a series of contract cancellations and fraud crackdowns led by DOGE. According to Breitbart News, DOGE recently canceled 105 contracts totaling $935 million in potential taxpayer liabilities. The agency’s website currently lists over 6,600 terminated contracts, accounting for $20 billion in savings.

The president praised Musk and DOGE for rooting out government inefficiencies, noting his administration was focused on “cutting” people and programs that were not working or delivering results. “We’re not going to let people collect paychecks or taxpayer funds without doing their jobs,” Trump said.

Also during the cabinet session, USDA Secretary Brooke Rollins revealed her department had eliminated a $300,000 program aimed at teaching “food justice” to transgender and queer farmers in San Francisco. “I’m not even sure what that means,” Rollins said, “but apparently the last administration wanted to put our taxpayer dollars towards that.”

These revelations highlight what many conservatives have long suspected—that during prior administrations, including under President Joe Biden, massive amounts of federal funding were funneled into unserious, ideologically-driven projects and mismanaged government programs. Under the Trump administration’s second term, DOGE appears to be living up to its mission: trimming fat, exposing fraud, and putting American taxpayers first.

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Cuba has lost 24% of it’s population to emigration in the last 4 years

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A new study finds Cuba has lost nearly a quarter of its population since 2020, driven by economic collapse and a mass emigration wave unseen outside of war zones. The country’s population now stands at just over 8 million, down from nearly 10 million.

Key Details:

  • Independent study estimates Cuba’s population at 8.02 million—down 24% in four years.
  • Over 545,000 Cubans left the island in 2024 alone—double the official government figure.
  • Demographer warns the crisis mirrors depopulation seen only in wartime, calling it a “systemic collapse.”

Diving Deeper:

Cuba is undergoing a staggering demographic collapse, losing nearly one in four residents over the past four years, according to a new study by economist and demographer Juan Carlos Albizu-Campos. The report estimates that by the end of 2024, Cuba’s population will stand at just over 8 million people—down from nearly 10 million—a 24% drop that Albizu-Campos says is comparable only to what is seen in war-torn nations.

The study, accessed by the Spanish news agency EFE, points to mass emigration as the primary driver. In 2024 alone, 545,011 Cubans are believed to have left the island. That number is more than double what the regime officially acknowledges, as Cuba’s government only counts those heading to the United States, ignoring large flows to destinations like Mexico, Spain, Serbia, and Uruguay.

Albizu-Campos describes the trend as “demographic emptying,” driven by what he calls a “quasi-permanent polycrisis” in Cuba—an interwoven web of political repression, economic freefall, and social decay. For years, Cubans have faced food and medicine shortages, blackout-plagued days, fuel scarcity, soaring inflation, and a broken currency system. The result has been not just migration, but a desperate stampede for the exits.

Yet, the regime continues to minimize the damage. Official figures from the National Office of Statistics and Information (ONEI) put Cuba’s population at just over 10 million in 2023. However, even those numbers acknowledge a shrinking population and the lowest birth rate in decades—confirming the crisis, if not its full scale.

Cuba hasn’t held a census since 2012. The last scheduled one in 2022 has been repeatedly delayed, allegedly due to lack of resources. Experts doubt that any new attempt will be transparent or complete.

Albizu-Campos warns that the government’s refusal to confront the reality of the collapse is obstructing any chance at solutions. More than just a demographic issue, the study describes Cuba’s situation as a “systemic crisis.”

 

Havana (Cuba, February 2023)” by Bruno Rijsman licensed under CC BY-SA 2.0 DEED.
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