Prime minister and premier combine to reduce living standards in B.C.

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:

Jake Fuss

Director, Fiscal Studies, Fraser Institute

Related Topics:#FraserInstitute #JakeFuss BCEbyGovernment BCLivingStandards BCNDPGovernmentSpending

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Worst kept secret—red tape strangling Canada’s economy

Published on February 22, 2025

Todayville

From the Fraser Institute

By Matthew Lau

In the past nine years, business investment in Canada has fallen while increasing more than 30 per cent in the U.S. on a real per-person basis. Workers in Canada now receive barely half as much new capital per worker than in the U.S.

According to a new Statistics Canada report, government regulation has grown over the years and it’s hurting Canada’s economy. The report, which uses a regulatory burden measure devised by KPMG and Transport Canada, shows government regulatory requirements increased 2.1 per cent annually from 2006 to 2021, with the effect of reducing the business sector’s GDP, employment, labour productivity and investment.

Specifically, the growth in regulation over these years cut business-sector investment by an estimated nine per cent and “reduced business start-ups and business dynamism,” cut GDP in the business sector by 1.7 percentage points, cut employment growth by 1.3 percentage points, and labour productivity by 0.4 percentage points.

While the report only covered regulatory growth through 2021, in the past four years an avalanche of new regulations has made the already existing problem of overregulation worse.

The Trudeau government in particular has intensified its regulatory assault on the extraction sector with a greenhouse gas emissions cap, new fuel regulations and new methane emissions regulations. In the last few years, federal diktats and expansions of bureaucratic control have swept the auto industry, child care, supermarkets and many other sectors.

Again, the negative results are evident. Over the past nine years, Canada’s cumulative real growth in per-person GDP (an indicator of incomes and living standards) has been a paltry 1.7 per cent and trending downward, compared to 18.6 per cent and trending upward in the United States. Put differently, if the Canadian economy had tracked with the U.S. economy over the past nine years, average incomes in Canada would be much higher today.

Also in the past nine years, business investment in Canada has fallen while increasing more than 30 per cent in the U.S. on a real per-person basis. Workers in Canada now receive barely half as much new capital per worker than in the U.S., and only about two-thirds as much new capital (on average) as workers in other developed countries.

Consequently, Canada is mired in an economic growth crisis—a fact that even the Trudeau government does not deny. “We have more work to do,” said Anita Anand, then-president of the Treasury Board, last August, “to examine the causes of low productivity levels.” The Statistics Canada report, if nothing else, confirms what economists and the business community already knew—the regulatory burden is much of the problem.

Of course, regulation is not the only factor hurting Canada’s economy. Higher federal carbon taxes, higher payroll taxes and higher top marginal income tax rates are also weakening Canada’s productivity, GDP, business investment and entrepreneurship.

Finally, while the Statistics Canada report shows significant economic costs of regulation, the authors note that their estimate of the effect of regulatory accumulation on GDP is “much smaller” than the effect estimated in an American study published several years ago in the Review of Economic Dynamics. In other words, the negative effects of regulation in Canada may be even higher than StatsCan suggests.

Whether Statistics Canada has underestimated the economic costs of regulation or not, one thing is clear: reducing regulation and reversing the policy course of recent years would help get Canada out of its current economic rut. The country is effectively in a recession even if, as a result of rapid population growth fuelled by record levels of immigration, the GDP statistics do not meet the technical definition of a recession.

With dismal GDP and business investment numbers, a turnaround—both in policy and outcomes—can’t come quickly enough for Canadians.

Matthew Lau

Adjunct Scholar, Fraser Institute

Business

‘Out and out fraud’: DOGE questions $2 billion Biden grant to left-wing ‘green energy’ nonprofit`

Published on February 22, 2025

Todayville

From LifeSiteNews

By Calvin Freiburger

The EPA under the Biden administration awarded $2 billion to a ‘green energy’ group that appears to have been little more than a means to enrich left-wing activists.

The U.S. Environmental Protection Agency (EPA) under the Biden administration awarded $2 billion to a “green energy” nonprofit that appears to have been little more than a means to enrich left-wing activists such as former Democratic candidate Stacey Abrams.

Founded in 2023 as a coalition of nonprofits, corporations, unions, municipalities, and other groups, Power Forward Communities (PFC) bills itself as “the first national program to finance home energy efficiency upgrades at scale, saving Americans thousands of dollars on their utility bills every year.” It says it “will help homeowners, developers, and renters swap outdated, inefficient appliances with more efficient and modernized options, saving money for years ahead and ensuring our kids can grow up with cleaner, pollutant-free air.”

The organization’s website boasts more than 300 member organizations across 46 states but does not detail actual activities. It does have job postings for three open positions and a form for people to sign up for more information.

The Washington Free Beacon reported that the Trump administration’s Department of Government Efficiency (DOGE) project, along with new EPA administrator Lee Zeldin, are raising questions about the $2 billion grant PFC received from the Biden EPA’s National Clean Investment Fund (NCIF), ostensibly for the “affordable decarbonization of homes and apartments throughout the country, with a particular focus on low-income and disadvantaged communities.”

PFC’s announcement of the grant is the organization’s only press release to date and is alarming given that the organization had somehow reported only $100 in revenue at the end of 2023.

“I made a commitment to members of Congress and to the American people to be a good steward of tax dollars and I’ve wasted no time in keeping my word,” Zeldin said. “When we learned about the Biden administration’s scheme to quickly park $20 billion outside the agency, we suspected that some organizations were created out of thin air just to take advantage of this.” Zeldin previously announced the Biden EPA had deposited the $20 billion in a Citibank account, apparently to make it harder for the next administration to retrieve and review it.

“As we continue to learn more about where some of this money went, it is even more apparent how far-reaching and widely accepted this waste and abuse has been,” he added. “It’s extremely concerning that an organization that reported just $100 in revenue in 2023 was chosen to receive $2 billion. That’s 20 million times the organization’s reported revenue.”

Daniel Turner, executive director of energy advocacy group Power the Future, told the Beacon that in his opinion “for an organization that has no experience in this, that was literally just established, and had $100 in the bank to receive a $2 billion grant — it doesn’t just fly in the face of common sense, it’s out and out fraud.”

Prominent among PFC’s insiders is Abrams, the former Georgia House minority leader best known for persistent false claims about having the state’s gubernatorial election stolen from her in 2018. Abrams founded two of PFC’s partner organizations (Southern Economic Advancement Project and Fair Count) and serves as lead counsel for a third group (Rewiring America) in the coalition. A longtime advocate of left-wing environmental policies, Abrams is also a member of the national advisory board for advocacy group Climate Power.