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Federal budget’s scale of spending and debt reveal a government lacking self-control

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From the Fraser Institute

By Jake Fuss and Grady Munro

Had the government simply limited the growth in annual program spending to 0.3 per cent for two years, it could have balanced the budget by 2026/27 and avoided significant debt accumulation.

Instead, the government chose to increase annual program spending by an average of 4.4 per cent over the next two years and kick the debt problem down the road for another government to solve.

Time and time again, Prime Minister Justin Trudeau and Finance Minister Chrystia Freeland have emphasized the importance of being fiscally responsible with federal finances. Unfortunately, this year’s federal budget ensures once again their rhetoric rings hollow due to their ongoing mismanagement of federal finances.

This mismanagement is rooted in the government’s insatiable appetite for new and expanded programs or services, which has endured for nine years and will continue for the foreseeable future. The budget introduces billions of dollars in additional spending for a national school food program, housing initiatives and artificial intelligence. As such, program spending (total spending minus debt interest costs) is now expected to be $77.2 billion higher over the next four years than the government forecasted last spring.

In 2024/25 alone, federal program spending will reach a projected $483.6 billion—an increase of $16.1 billion compared to the previous budget’s estimates. On a per-person inflation-adjusted basis, federal program spending is forecasted to reach $11,901, which is approximately 28.0 per cent higher than during the final full year of Stephen Harper’s tenure as prime minister (2014/15). The Trudeau government has already recorded the five (2018 to 2022) highest levels of federal program spending per person in Canadian history (inflation-adjusted), and budget projections suggest it’s now on track to possess the eight highest levels of per-person spending by the end of its term next autumn.

This is despite recent polling data that shows the majority of Canadians (59 per cent) think the Trudeau government is spending too much. Nearly two-thirds (64 per cent) of Canadians are also concerned about the size of the federal deficit.

As it has done nine times before, the Trudeau government will borrow to fund some of its spending spree, resulting in a projected budget deficit of $39.8 billion this year, which is $4.8 billion higher than previously forecasted. And it doesn’t intend to stop borrowing, with annual deficits exceeding $20 billion planned for the subsequent four years. This represents a notable increase in deficits compared to what was expected in the last year’s budget. Simply put, there’s no plan for a return to balanced budgets any time soon. As a result, federal debt (net debt minus non-financial assets) is expected to climb $156.2 billion from now until April 2029.

To make matters worse, the government is also increasing the capital gains inclusion tax rate from 50.0 per cent to 66.6 per cent for capital gains realized above $250,000. This will act as a huge disincentive for individuals and businesses to invest in Canada at a time when the country already struggles to attract the very investment we need to improve productivity, economic growth and living standards. Businesses and individuals will now simply invest their capital elsewhere.

There’s a large body of research that finds low or no capital gains taxes increase the supply and lower the cost of capital for new and growing firms, leading to higher levels of entrepreneurship, economic growth and job creation—precisely what Canada needs more of today and in the future.

While the government did boast about its ability to hold the 2023/24 deficit at $40.0 billion, this had little to do with responsible fiscal management. Instead, the government enjoyed higher-than-anticipated revenues of $8.3 billion, but repeated its all too frequent and ill-advised approach of spending that money and wiping out any chance to reduce the deficit.

Growing federal debt leads to higher debt interest costs, all else equal, which eat up taxpayer dollars that could otherwise have provided services or tax relief for Canadians. For context, the government now spends more ($54.1 billion) on debt interest as on health-care transfers to the provinces ($52.1 billion). Accumulating debt today also increases the tax burden on future generations of Canadians who are ultimately responsible for paying off this debt. Research suggests this effect could be disproportionate, with future generations needing to pay back a dollar borrowed today with more than one dollar in future taxes.

But again, it didn’t have to be this way. As we pointed out before the budget, had the government simply limited the growth in annual program spending to 0.3 per cent for two years, it could have balanced the budget by 2026/27 and avoided significant debt accumulation.

Instead, the government chose to increase annual program spending by an average of 4.4 per cent over the next two years and kick the debt problem down the road for another government to solve. Simply put, the government’s fiscal strategy is not all that different from an overzealous child that eats all their Halloween candy in one night even though they fully understand it won’t end well.

Yet for all this spending and debt, living standards have not improved for Canadians. In fact, inflation-adjusted GDP per person was actually lower at the end of 2023 than it was nine years prior in 2014. And going forward, the OECD predicts Canada will record the lowest growth rates in per-person GDP up to 2060 of any industrialized country—meaning countries such as New Zealand, Italy, Korea, Turkey and Estonia would all surpass Canada with higher living standards.

The combination of tax hikes and scale of spending and debt in this year’s federal budget demonstrate the Trudeau government has no interest in being fiscally responsible or improving living standards for Canadians. Instead of showing restraint, the government chose to repeat its mistakes and lead federal finances down an increasingly perilous path.

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Trump’s dismantling of USAID is his biggest blow against the Deep State yet

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From LifeSiteNews

By Frank Wright

Elon Musk’s DOGE has shut down USAID, immediately ceasing U.S. government funding of NGOs backing digital tyranny, mass migration, the ‘LGBTQ’ agenda, abortion – and a host of ‘regime change’ operations.

Donald Trump’s new administration has begun to dismantle globalist network funding of the policies of social revolution across the West – and beyond. With the revelations on the shuttering of USAID, Americans now know whose money is behind the Deep State: theirs. 

Trump’s war on the Deep State has shocked the establishment. Elon Musk’s DOGE has shut down  USAID, immediately ceasing U.S. government funding of NGOs backing digital tyranny, mass migration, the “LGBTQ” agenda, abortion – and a host of “regime change” operations including the funding of the origins of COVID-19 and the impeachment of Donald Trump himself.  

These projects, and many more, were all paid for with U.S. taxpayer’s money through USAID. 

This Deep State network of finance, influence and the subversion of democracy in the U.S., Britain, Europe and beyond remained unchanged in every election – until this one.  

USAID, The U.S. Agency for International Development, “disbursed over 72 billion dollars last year,” according to a Newsweek report in October 2024, which described the now-defunct agency as “by far the world’s largest provider of humanitarian aid.” 

So where is this “aid” going? 

 

… and what sort of “humanitarian” projects has it been aiding? 

“USAID is notorious for funding the most horrifying projects known to mankind,” as Mike Benz explains.   

USAID’s “humanitarian” work included funding and directing the template for global digital governance in Ukraine, with its DIIA app, and funding the World Economic Forum which promotes the same agenda:  

Its humanitarian efforts extended to sponsoring anti-Catholic propaganda in Ireland: 

 

As Glenn Beck has pointed out, USAID was a major sponsor of abortion:  

Here is a picture of ISIS terrorists in Syria in a USAID tent:

USAID was also funding “globalist propaganda” on the U.K.’s state broadcaster:

Independent journalist Michael Shellenberger reported, “From 2004-2022, USAID was the largest U.S. government funder of EcoHealth Alliance, the group that funded the Wuhan Institute of Virology (WIV), which likely started the COVID pandemic.” 

 

USAID sought to undermine and overthrow traditional and conservative national governments in Eastern Europe – and replace them with liberal-globalist ones:  

 

Dmitry Arestovich, the former right-hand man to Ukraine’s Volodymyr Zelensky, now says USAID pressured the Ukrainian President into the war: 

 

USAID funded “sterilization projects” in Peru: 

 

And as LifeSiteNews reported in December 2024, USAID pressured African nations to change pro-life laws and promote mass abortions, but that did not stop Fr. James Martin from bewailing its demise. 

 

USAID also paid “race rioters” to engage in violent protests in Africa: 

 

At home, USAID sponsored the prosecution of U.S. citizens by “Soros-funded prosecutors”:

 

…and, as former Trump State Department staffer Mike Benz also asks, “Why did USAID pay $20 million to hit piece journalists to dig up dirt on Rudy Giuliani and use that dirt as the basis to impeach the sitting U.S. President in 2019?” 

 

USAID was also giving “millions of dollars to Bill Kristol,” arch-neocon and founder of the permanent war “Project for a New American Century.”

 

The populist leader of El Salvador Nayib Bukele summed up the happy ending for the world that is the end of USAID.  

“Most governments don’t want USAID funds flowing into their countries because they understand where much of that money actually ends up. While marketed as support for development, democracy, and human rights, the majority of these funds are funneled into opposition groups, NGOs with political agendas, and destabilizing movements.” 

He explained how only “maybe 10% of the money reaches real projects that help people in need,” adding that “there are such cases” – but the remaining ninety percent, he says, “It is used to fuel dissent, finance protests, and undermine administrations that refuse to align with the globalist agenda. Cutting this so-called aid isn’t just beneficial for the United States; it’s also a big win for the rest of the world.” 

Donald Trump’s war on the Deep State has just begun. It is not merely concerned with saving America, but his “common sense revolution” is a cure for a world made sick by a global network of death, deception and digital tyranny. He is uprooting the hidden international system which has promoted “LGBT, open borders and war” – as Hungary’s Viktor Orbán defined the values of the former regime. 

This has been described as a “counter-revolution” by Archbishop Carlo Maria Viganò, who says these are serious moves against the “Deep State… and its mirror image, the Deep Church.”

With a serious campaign underway to destroy the business model of the globalist system it is hard to see how the rainbow “church” of Fr. James Martin can survive its isolation in a world without the patronage, propaganda and power of a corrupt Deep State and its globalist networks. 

And the revolution does not stop with USAID. With moves to “purge” the FBI, audit the U.S. Treasury and all the agencies of the U.S. government, Musk’s Department of Government Efficiency is set to undertake a thorough cleanup of the White House and all it commands.  

You might say the swamp is being drained. 

However you frame it, what is happening here has never been seen in our lifetimes.  

The secret state which directed politics and policy in the West despite elections is being exposed, defunded and shut down. We may not only have meaningful elections in future, but a Western society free of the propaganda of social revolution whose toxic “new values” had one thing in mind: the replacement of Christian civilization with a global government no one could ever escape.  

Finally, after decades of destruction by design, things have really changed. For good. 

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Trans Mountain Pipeline proving to be a generational opportunity

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From Energy Now

Trans Mountain Pipeline System a Strategic Canadian Asset

On May 1, 2024, we began commercial operations of the expanded Trans Mountain pipeline. Building a system that increased capacity from approximately 300,000 to 890,000 barrels per day (bpd) is proving to be one of the most strategic investments Canada has ever made. It has allowed us to diversify Canada’s customers for our oil, which has increased revenues and provided Canada with trading options in the face of tariffs from our biggest trading partner, the United States.
While energy is targeted for a lower tariff of 10 per cent (at time of writing), we expect utilization of the Trans Mountain pipeline to grow as Canadian producers look to access markets without a tariff. When the expansion project was first proposed it had three main goals — to give more capacity for responsibly produced Canadian crude oil to grow and meet the energy needs of the world, to give Canadian oil access to global markets on the Pacific Rim, and to increase the value of Canadian oil through this market diversification. I am happy to share that we are achieving these goals.
On the first goal, crude oil production increased in 2024 as producers had greater capacity to ship, and this production is set to grow further in 2025. According to industry analysts, total crude oil production in Canada reached 5.3 million bpd in December 2023. It hit 5.4 million bpd in December 2024 and is expected to reach 5.6 million bpd by December 2025.
Since May 1, Trans Mountain has sent roughly half of the shipments from our marine terminal to countries other than the United States on the Pacific Rim, and half have gone to refineries on the west coast of the United States. In a recently released independent report by Alberta Central, economist Charles St-Arnaud highlights, “non-U.S. oil exports more than doubled in the second half of 2024.”
This increased access to international markets is what drives the third goal, allowing Canada to get a better price for our product. In the past, Canada had to sell crude oil into a single market, often at a steep discount or differential to the benchmark price. This has been a substantial transfer of wealth from Canada to another country.
With the startup of the expanded system, the discount on Canadian crude oil has improved. The price differential between Western Canada Select (WCS) and West Texas Intermediate (WTI) narrowed by about $10 in Q4 2024 versus Q4 2023. Analysts estimate this price uplift increased oil revenues by $10 billion since we began shipping oil through the expanded system.
We are in month 10 of commercial operations and are now identifying and investigating growth opportunities that would improve the throughput efficiency and increase the capacity of the expanded system, ideally in the next four to five years under the current regulatory regime. Execution of any project requires extensive collaboration and engagement with our business partners, governments, Indigenous peoples, community groups and other affected stakeholders. It also requires multiple levels of approvals by provincial and federal regulators.
While we see beneficial growth opportunities, before Trans Mountain or any other energy system can consider significant expansions or investments in Canada, our nation needs to find more efficiencies in effective engagement and our regulatory process. Given our evolving global energy landscape, increasing Canada’s ability to reach new markets to supply Canadian energy to other nations is becoming increasingly important.
Canada has a long history of being a stable provider of responsibly produced energy to the United States and, hopefully, this relationship will soon return to how it was before Feb. 1. However, we now have the opportunity to deliver our products to other nations on the Pacific Rim.
As stated before a committee of Parliament in 2024, the fiscal legacy of the Trans Mountain pipeline system for the Government of Canada will be achieved by being a disciplined seller. When the time is right, Canada can return the company to the private sector and receive full value for its investment. That is the goal of our entire team. That investment is proving to be the generational opportunity the federal government predicted it could be when it purchased the company. Canada’s leadership demonstrated the foresight to see this through and stepped up at a critical time to do what was good for the country.Trans Mountain is delivering what was promised, and as it turns out, just in time.

Mark Maki is chief executive of Trans Mountain.

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