Business
Instead of competing, Ontario’s Ford plans to spend billions to stimulate growth
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From the Fraser Institute
By Jake Fuss and Grady Munro
Premier Doug Ford, who will trigger an election this week, recently said he plans to “spend billions of dollars” to stimulate Ontario’s economy if President Donald Trump makes good on his threat to slap a 25 per cent tariff on Canadian exports into the United States.
But rather than piling on even more spending, the next Ontario government—whoever that may be—should enact policies that finally get provincial finances back in order and make Ontario an attractive place to work and invest.
Relief can’t come soon enough. The Ford government has woefully mismanaged provincial finances. When first elected in 2018, Premier Ford promised to balance the budget and reduce government debt—something Ford’s former finance minister Vic Fedeli described as a “moral” imperative. Yet since then, the government has run deficits in five of six years and its net debt burden has increased by an estimated $70.3 billion.
As a result, in 2023 Ontario had the second-highest debt burden of any province (only Newfoundland and Labrador had a larger burden) when measured on a per-person basis.
Based on the Ford government’s latest fiscal update, the reckless mismanagement has continued into this fiscal year (2024/25). Despite enjoying lower-than-expected debt interest costs and higher-than-expected revenues—which combined could have nearly eliminated the budget deficit—the Ford government instead chose to again increase spending and keep running deficits.
Why should Ontarians care?
Because the Ford government’s penchant for spending and borrowing is hurting Ontario’s economy. When the government runs a deficit and accumulates more debt, it competes with individuals, households and businesses for borrowing. This drives up interest rates (i.e. the cost of borrowing) for everyone, which can reduce the level of investment in the economy. Moreover, because rising debt and higher interest rates equal higher interest payments, the government faces pressure to raise taxes. And the brunt of the new tax burden will fall on younger generations of Ontarians.
Also this week, Premier Ford said President Trump “wants to attract businesses from Ontario to come down to the United States,” which will eliminate jobs in the province.
And Ford’s right. When policymakers create the conditions to attract people and investment, their economies grow and people prosper.
If the Ontario government wants to beat Trump at his own game, it should lower personal income taxes and make the province a more attractive destination for high-skilled workers such as engineers and entrepreneurs who contribute greatly to the economy and create jobs. Lower taxes also improve the incentive for individuals to engage in productive activities such as working, saving and investing. In 2023, Ontario had the third-highest top combined (provincial and federal) personal income tax rate in Canada and the U.S.
The government should also lower business taxes to make Ontario more competitive with the U.S. in attracting businesses and investment—the pillars of job-creation and prosperity.
Regardless of who wins the election, the next Ontario government should finally restore some semblance of fiscal responsibility and balance the budget. And it should lower taxes for workers and businesses to help create prosperity across the province. That’s a much more sensible and sustainable way to counter threats from Trump (or anyone else) than spending billions of dollars borrowed on the backs of Ontarians.
Business
Zelenskyy Says He Still Wants To Sign Mineral Deal With US After Oval Office Spat With Trump
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From the Daily Caller News Foundation
By
Ukrainian President Volodymyr Zelenskyy said Friday on Fox News that he still wants to sign the mineral deal with the United States despite his public blowup at the Oval Office.
During a gathering in the Oval Office on Friday with President Donald Trump, Vice President JD Vance, and other officials to discuss the U.S. deal with Ukraine over its minerals, Trump and Vance called out Zelenskyy’s behavior after he publicly criticized the U.S. for not attempting to halt Russia. Following the heated discussion, Zelenskyy appeared on “Special Report with Bret Baier” and told the host that he still believes the deal should be signed, adding he wanted to understand the security guarantees the U.S. would provide.
“United States wanted this deal very much, and we’ve been not against this deal, but we wanted to understand what parts in security guarantees will take this deal and what next steps. Just again, to understand for our people, during the war, what you don’t like, even sometimes hate? Surprises,” Zelenskyy said.
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“It’s understandable. Many terrible things this war brought to us. So we don’t, we don’t want any surprises. Yes, that’s why we want to be very fair with our partners. I think this deal was prepared by teams. It was not simple during [the] weeks, and now it’s ready. I think that they have to sign. The countries have to sign. The ministers have to sign. That’s it. I don’t know when they will do it. It depends on the American side.”
Multiple sources on Tuesday said that the U.S. had struck a deal with Ukraine to jointly develop mineral extraction projects within the nation.
WATCH:
By Thursday, Trump’s Treasury Secretary Scott Bessent told Fox News that “the deal is done,” adding it was a “win-win” for all parties and would be signed by Friday at the White House. However, following Zelenskyy’s clash with the president and vice president, the White House told Daily Caller White House correspondent Reagan Reese that “nothing will be signed.”
Baier went on to ask Zelenskyy if the deal did not include security provisions, to which the Ukrainian president said that it was part of the “infrastructure.” Zelenskyy further said that Trump had said Russian President Vladimir Putin would not be able to enter certain mineral production territories. However, the Ukrainian president disagreed with the decision, saying he had told Trump not to “trust Putin.”
“I said to him that we had more than two, more than 20 companies, American companies, big companies on the territory of Ukraine. We had offices, even on temporarily occupied territories. For Putin, it doesn’t matter,” Zelenskyy said. “It’s a European company or Ukraine. It doesn’t matter. He just came and occupied it.”
“That’s what I said. I think this is a great idea [on] how to strengthen Ukraine and how to make business between two countries, how to make additional jobs for two countries. But it’s not just this will not save us,” Zelenskyy said.
After Zelenskyy left the White House, Trump took to Truth Social, posting that he had determined Zelenskyy is “not ready for Peace if America is involved, because he feels our involvement gives him a big advantage in negotiations.”
“I don’t want advantage, I want PEACE. He disrespected the United States of America in its cherished Oval Office. He can come back when he is ready for Peace,” Trump wrote.
Business
Trump and fentanyl—what Canada should do next
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From the Fraser Institute
During the Superbowl, Doug Ford ran a campaign ad about fearlessly protecting Ontario workers against Trump. I suppose it’s effective as election theatre; it’s intended to make Ontarians feel lucky we’ve got a tough leader like Ford standing up to the Bad Orange Man. But my reaction was that Ford is lucky to have the Bad Orange Man creating a distraction so he doesn’t have to talk about Ontario’s high taxes, declining investment, stagnant real wages, lengthening health-care wait times and all the other problems that have gotten worse on his watch.
President Trump’s obnoxious and erratic rhetoric also seems to have put his own advisors on the defensive. Peter Navarro, Kevin Hassett and Howard Lutnick have taken pains to clarify that what we are dealing with is a “drug war not a trade war.” This is confusing since many sources say that Canada is responsible for less than one per cent of fentanyl entering the United States. But if we are going to de-escalate matters and resolve the dispute, we should start by trying to understand why they think we’re the problem.
Suppose in 2024 Trump and his team had asked for a Homeland Security briefing on fentanyl. What would they have learned? They already knew about Mexico. But they would also have learned that while Canada doesn’t rival Mexico for the volume of pills being sent into the U.S., we have become a transnational money laundering hub that keeps the Chinese and Mexican drug cartels in business. And we have ignored previous U.S. demands to deal with the problem.
Over a decade ago, Vancouver-based investigative journalist Sam Cooper unearthed shocking details of how Asian drug cartels backed by the Chinese Communist Party turned British Columbia’s casinos into billion-dollar money laundering operations, then scaled up from there through illicit real estate schemes in Vancouver and Toronto. This eventually triggered the 2022 Cullen Commission, which concluded, bluntly, that a massive amount of drug money was being laundered in B.C., that “the federal anti–money laundering [AML] regime is not effective,” that the RCMP had shut down what little AML capacity it had in 2012 just as the problem was exploding in scale, and that government officials have long known about the problem but ignored it.
In 2023 the Biden State Department under Anthony Blinken told Canada our fentanyl and money laundering control efforts were inadequate. Since then Canada’s border security forces have been shown to be so compromised and corrupt that U.S. intelligence agencies sidelined us and stopped sharing information. The corruption went to the top. A year ago Cameron Ortis, the former head of domestic intelligence at the RCMP, was sentenced to 14 years in prison after being convicted of selling top secret U.S. intelligence to money launderers tied to drugs and terrorism to help them avoid capture.
In September 2024 the Biden Justice Department hit the Toronto-Dominion Bank with a $3 billion fine for facilitating $670 million in money laundering for groups tied to transnational drug trafficking and terrorism. Then-attorney general Merrick Garland said “TD Bank created an environment that allowed financial crime to flourish. By making its services convenient for criminals, it became one.”
Imagine the outcry if Trump had called one of our chartered banks a criminal organization.
We are making some progress in cleaning up the mess, but in the process learning that we are now a major fentanyl manufacturer. In October the RCMP raided massive fentanyl factories in B.C. and Alberta. Unfortunately there remain many gaps in our enforcement capabilities. For instance, the RCMP, which is responsible for border patrols between ports of entry, has admitted it has no airborne surveillance operations after 4 p.m. on weekdays or on weekends.
The fact that the prime minister’s promise of a new $1.3-billion border security and anti-drug plan convinced Trump to suspend the tariff threat indicates that the fentanyl angle wasn’t entirely a pretext. And we should have done these things sooner, even if Trump hadn’t made it an issue. We can only hope Ottawa now follows through on its promises. I fear, though, that if Ford’s Captain Canada act proves a hit with voters, the Liberals may distract voters with a flag-waving campaign against the Bad Orange Man rather than confront the deep economic problems we have imposed on ourselves.
A trade dispute appears inevitable now that Trump has signaled the 25 percent tariffs are back on. The problem is knowing whom to listen to since Trump is openly contradicting his own economic team. Trump’s top trade advisor, Peter Navarro, has written that the U.S. needs to pursue “reciprocity,” which he defines as other countries not charging tariffs on U.S. imports any higher than the U.S. charges. In the Americans’ view, U.S. trade barriers are very low and everyone else’s should be, too—a stance completely at odds with Trump’s most recent moves.
Whichever way this plays out Canada has no choice but to go all-in on lowering the cost of doing business here, especially in trade-exposed sectors such as steel, autos, manufacturing and technology. That starts with cutting taxes including carbon-pricing and rolling back our costly net-zero anti-energy regulatory regime. In the coming election campaign, that’s the agenda we need to see spelled out.
How much easier it will be instead for Canadian politicians to play the populist hero with vague anti-Trump posturing. But that would be poor substitute for a long overdue pro-Canadian economic growth agenda.
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