Business
Alberta freest Canadian province, ranks 12th in North American; other provinces rank near bottom

From the Fraser Institute
By: Dean Stansel, José Torra, Matthew D. Mitchell and Ángel Carrión-Tavárez
Alberta is, once again, the Canadian province with the highest level of economic freedom, while most other provinces rank in the bottom half in the annual Economic Freedom of North America report, published today by the Fraser Institute, an independent, non-partisan, public policy think-tank.
Individuals have more economic freedom when they are allowed to make more of their own economic decisions such as what to buy, where to work and how to start and run a business. And research shows that economic freedom is fundamental to prosperity.
The report ranks the provinces and states individually for each country (Canada, the U.S. and Mexico). In addition, there is a fourth measure comparing and ranking all states and provinces, across all three countries. All of the rankings measure government spending, taxation, regulations and labour market restrictions using data from 2022 (the latest year of available comparable data).
“Higher taxes, higher levels of government spending and overly burdensome regulations continue to depress economic freedom across much of Canada, which makes it harder for individuals and businesses to thrive and create jobs,” said Matthew Mitchell, a senior fellow at the Fraser Institute and co-author of this year’s report.
In the ranking covering all three countries, which includes both federal and provincial government policies, Alberta is once again the highest-ranking Canadian province. It tied four U.S. states at 12th, having improved its ranking from 41st last year.
The next freest province is British Columbia, which ranks 43rd out of 93, followed by Ontario (47th), Saskatchewan (50th), Manitoba (53rd) and Quebec (54th).
The four Atlantic provinces— New Brunswick (57th), Prince Edward Island (58th), Nova Scotia (59th) and Newfoundland and Labrador (60th)—have the lowest levels of economic freedom among all provinces and U.S. states, only outranking the Mexican states and Puerto Rico. New Hampshire, once again, earned the overall top spot amongst all provinces and states in the rankings this year.
“The link between economic freedom and prosperity is clear: people who live in provinces or states that have comparatively lower taxation, lower government, sound regulatory regimes and more flexible labor markets tend, on average, to live happier, healthier and wealthier lives,” Mitchell said.
For instance, according to the latest report, total income in the freest jurisdictions grew 29 per cent after adjusting for inflation over the last decade, while in the least-free jurisdictions, total inflation adjusted income fell 13 per cent.
The Economic Freedom of North America report (co-authored by Dean Stansel, José Torra and Ángel Carrión-Tavárez) is an offshoot of the Fraser Institute’s Economic Freedom of the World index, the result of more than a quarter century of work by more than 60 scholars including three Nobel laureates.
Detailed tables for each country and subnational jurisdiction can be found at www.freetheworld.org.
Economic Freedom of North America 2024
- The indices in the Economic Freedom of North America 2024 measure the degree to which governments in North America permit their citizens to make their own economic choices.
- They include data from the 10 Canadian provinces, 50 US states, 32 Mexican states, and the US territory of Puerto Rico.
- In the all-government index—which takes account of federal as well as state/provincial policies—the most economically-free jurisdiction in North America is New Hampshire, followed by Idaho, Oklahoma and South Carolina tied for third, and Florida and Indiana tied for fifth.
- The lowest-ranking jurisdictions are all Mexican states. In last place is Ciudad de México. Above that is Colima, Campeche, Tamaulipas, and Zacatecas.
- Alberta is the highest-ranking Canadian province, tied for 12th place with Tennessee, South Dakota, Colorado, and Texas. The next-highest Canadian province is British Columbia, which is tied with Massachusetts, Minnesota, and New Mexico for 43rd.
- Average economic freedom across all 93 jurisdictions has fallen every year since 2017 and is now slightly above its all-time low.
- Incomes in the freest top 25 percent of North American jurisdictions were 21 times higher than in the least-free.
- From 2013 to 2022 the population of the freest US states grew 10 times faster and total employment grew three times faster than in the least-free states.
Business
Federal government’s accounting change reduces transparency and accountability

From the Fraser Institute
By Jake Fuss and Grady Munro
Carney’s deficit-spending plan over the next four years dwarfs the plan from Justin Trudeau, the biggest spender (per-person, inflation-adjusted) in Canadian history, and will add many more billions to Canada’s mountain of federal debt. Yet Prime Minister Carney has tried to sell his plan as more responsible than his predecessor’s.
All Canadians should care about government transparency. In Ottawa, the federal government must provide timely and comprehensible reporting on federal finances so Canadians know whether the government is staying true to its promises. And yet, the Carney government’s new spending framework—which increases complexity and ambiguity in the federal budget—will actually reduce transparency and make it harder for Canadians to hold the government accountable.
The government plans to separate federal spending into two budgets: the operating budget and the capital budget. Spending on government salaries, cash transfers to the provinces (for health care, for example) and to people (e.g. Old Age Security) will fall within the operating budget, while spending on “anything that builds an asset” will fall within the capital budget. Prime Minister Carney plans to balance the operating budget by 2028/29 while increasing spending within the capital budget (which will be funded by more borrowing).
According to the Liberal Party platform, this accounting change will “create a more transparent categorization of the expenditure that contributes to capital formation in Canada.” But in reality, it will muddy the waters and make it harder to evaluate the state of federal finances.
First off, the change will make it more difficult to recognize the actual size of the deficit. While the Carney government plans to balance the operating budget by 2028/29, this does not mean it plans to stop borrowing money. In fact, it will continue to borrow to finance increased capital spending, and as a result, after accounting for both operating and capital spending, will increase planned deficits over the next four years by a projected $93.4 billion compared to the Trudeau government’s last spending plan. You read that right—Carney’s deficit-spending plan over the next four years dwarfs the plan from Justin Trudeau, the biggest spender (per-person, inflation-adjusted) in Canadian history, and will add many more billions to Canada’s mountain of federal debt. Yet Prime Minister Carney has tried to sell his plan as more responsible than his predecessor’s.
In addition to obscuring the amount of borrowing, splitting the budget allows the government to get creative with its accounting. Certain types of spending clearly fall into one category or another. For example, salaries for bureaucrats clearly represent day-to-day operations while funding for long-term infrastructure projects are clearly capital investments. But Carney’s definition of “capital spending” remains vague. Instead of limiting this spending category to direct investments in long-term assets such as roads, ports or military equipment, the government will also include in the capital budget new “incentives” that “support the formation of private sector capital (e.g. patents, plants, and technology) or which meaningfully raise private sector productivity.” In other words, corporate welfare.
Indeed, based on the government’s definition of capital spending, government subsidies to corporations—as long as they somehow relate to creating an asset—could potentially land in the same spending category as new infrastructure spending. Not only would this be inaccurate, but this broad definition means the government could potentially balance the operating budget simply by shifting spending over to the capital budget, as opposed to reducing spending. This would add to the debt but allow the government to maneuver under the guise of “responsible” budgeting.
Finally, rather than split federal spending into two budgets, to increase transparency the Carney government could give Canadians a better idea of how their tax dollars are spent by providing additional breakdowns of line items about operating and capital spending within the existing budget framework.
Clearly, Carney’s new spending framework, as laid out in the Liberal election platform, will only further complicate government finances and make it harder for Canadians to hold their government accountable.
Business
Carney poised to dethrone Trudeau as biggest spender in Canadian history

From the Fraser Institute
By Jake Fuss
The Liberals won the federal election partly due to the perception that Prime Minister Mark Carney will move his government back to the political centre and be more responsible with taxpayer dollars. But in fact, according to Carney’s fiscal plan, he doesn’t think Justin Trudeau was spending and borrowing enough.
To recap, the Trudeau government recorded 10 consecutive budget deficits, racked up $1.1 trillion in debt, recorded the six highest spending years (per person, adjusted for inflation) in Canadian history from 2018 to 2023, and last fall projected large deficits (and $400 billion in additional debt) over the next four years including a $42.2 billion deficit this fiscal year.
By contrast, under Carney’s plan, this year’s deficit will increase to a projected $62.4 billion while the combined deficits over the subsequent three years will be $67.7 billion higher than under Trudeau’s plan.
Consequently, the federal debt, and debt interest costs, will rise sharply. Under Trudeau’s plan, federal debt interest would have reached a projected $66.3 billion in 2028/29 compared to $68.7 billion under the new Carney plan. That’s roughly equivalent to what the government will spend on employment insurance (EI), the Canada Child Benefit and $10-a-day daycare combined. More taxpayer dollars will be diverted away from programs and services and towards servicing the debt.
Clearly, Carney plans to be a bigger spender than Justin Trudeau—who was the biggest spender in Canadian history.
On the campaign trail, Carney was creative in attempting to sell this as a responsible fiscal plan. For example, he split operating and capital spending into two separate budgets. According to his plan’s projections, the Carney government will balance the operating budget—which includes bureaucrat salaries, cash transfers (e.g. health-care funding) and benefits (e.g. Old Age Security)—by 2028/29, while borrowing huge sums to substantially increase capital spending, defined by Carney as anything that builds an asset. This is sleight-of-hand budgeting. Tell the audience to look somewhere—in this case, the operating budget—so it ignores what’s happening in the capital budget.
It’s also far from certain Carney will actually balance the operating budget. He’s banking on finding a mysterious $28.0 billion in savings from “increased government productivity.” His plan to use artificial intelligence and amalgamate service delivery will not magically deliver these savings. He’s already said no to cutting the bureaucracy or reducing any cash transfers to the provinces or individuals. With such a large chunk of spending exempt from review, it’s very difficult to see how meaningful cost savings will materialize.
And there’s no plan to pay for Carney’s spending explosion. Due to rising deficits and debt, the bill will come due later and younger generations of Canadians will bear this burden through higher taxes and/or fewer services.
Finally, there’s an obvious parallel between Carney and Trudeau on the inventive language used to justify more spending. According to Carney, his plan is not increasing spending but rather “investing” in the economy. Thus his campaign slogan “Spend less, invest more.” This wording is eerily similar to the 2015 and 2019 Trudeau election platforms, which claimed all new spending measures were merely “investments” that would increase economic growth. Regardless of the phrasing, Carney’s spending increases will produce the same results as under Trudeau—federal finances will continue to deteriorate without any improvement in economic growth. Canadian living standards (measured by per-person GDP) are lower today than they were seven years ago despite a massive increase in federal “investment” during the Trudeau years. Yet Carney, not content to double down on this failed approach, plans to accelerate it.
The numbers don’t lie; Carney’s fiscal plan includes more spending and borrowing than Trudeau’s plan. This will be a fiscal and economic disaster with Canadians paying the price.
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