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Federal government out of touch with economic reality in Canada

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From the Fraser Institute

By Jake Fuss and Grady Munro

In light of recent comments from federal Finance Minister Chrystia Freeland about the supposed “vibecession” infecting the brains of Canadians, it’s time to set the record straight. It’s not just that people don’t feel good about the economy, the economic wellbeing of Canadians has been declining for years.

Firstly, it’s true that the overall economy is growing and inflation has been brought back down to the Bank of Canada’s 2 per cent target. While these are positive signs—especially considering the alternative of a shrinking overall economy and rising inflation—they do not necessarily mean that Canadians are better off.

Gross domestic product (GDP)—the value of all goods and services produced in the economy—is the most widely used measure of overall economic prosperity. But measuring it in “aggregate” doesn’t tell us about the individual living standards of Canadians. To gauge how individual Canadians are actually doing, we measure GDP per person (and adjust for inflation). And on this measure, the data tell a different story.

From the middle of 2019 to the end of 2023, Canada experienced one of the worst declines in inflation-adjusted GDP per person of the last 40 years. According to new data from Statistics Canada, this decline in living standards has continued for most of 2024, and as of September 2024, GDP per person ($58,601) was 2.2 per cent lower than in June 2019 ($59,905). Simply put, Canadians have suffered a marked decline in living standards over five years.

And while GDP per person is a broad measure of individual prosperity, other measures tell a similar story.

According to a recent study published by the Fraser Institute, median earnings (i.e. wages and salaries) of workers were lower in every Canadian province than in every U.S. state in 2022 (the latest year of available data). In other words, workers in Canada’s highest-earning province (Alberta) earned less than workers in the lower-earning U.S. states such as Louisiana and Mississippi.

Moreover, Canada’s private-sector employment has stagnated. From 2019 to 2023 (the latest year of available data), employment in the private sector (including self-employment) grew by 3.6 per cent compared to 13.0 per cent in the government sector. And that’s a problem. The private sector pays for the government sector, primarily through taxes. While a growing private sector helps drive wealth-creation in the economy, a growing government sector extracts that wealth and redistributes it elsewhere or even inhibits that wealth-creation in the first place.

Despite data showing that private-sector employment and living standards have stagnated and/or declined for years, the Trudeau government insists that everything is fine and Canadians just “feel” worse off. Clearly, this government is out of touch with economic reality.

Jake Fuss

Jake Fuss

Director, Fiscal Studies, Fraser Institute

Grady Munro

Grady Munro

Policy Analyst, Fraser Institute

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Canada urgently needs a watchdog for government waste

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This article supplied by Troy Media.

Troy Media By Ian Madsen

From overstaffed departments to subsidy giveaways, Canadians are paying a high price for government excess

Canada’s federal spending is growing, deficits are mounting, and waste is going unchecked. As governments look for ways to control costs, some experts say Canada needs a dedicated agency to root out inefficiency—before it’s too late

Not all the Trump administration’s policies are dubious. One is very good, in theory at least: the Department of Government Efficiency. While that
term could be an oxymoron, like ‘political wisdom,’ if DOGE proves useful, a Canadian version might be, too.

DOGE aims to identify wasteful, duplicative, unnecessary or destructive government programs and replace outdated data systems. It also seeks to
lower overall costs and ensure mechanisms are in place to evaluate proposed programs for effectiveness and value for money. This can, and often does, involve eliminating departments and, eventually, thousands of jobs. Some new roles within DOGE may need to become permanent.

The goal in the U.S. is to reduce annual operating costs and ensure government spending grows more slowly than revenues. Washington’s spending has exploded in recent years. The U.S. federal deficit now exceeds six per cent of gross domestic product. According to the U.S. Treasury Department, the cost of servicing that debt is rising at an unsustainable rate.

Canada’s latest budget deficit of $61.9 billion in fiscal 2023-24 amounts to about two per cent of GDP—less alarming than our neighbour’s situation, but still significant. It adds to the federal debt of $1.236 trillion, about 41 per cent of our estimated $3 trillion GDP. Ottawa’s public accounts show expenses at 17.8 per cent of GDP, up from about 14 per cent just eight years ago. Interest on the growing debt accounted for 9.1 per cent of
revenues in the most recent fiscal year, up from five per cent just two years ago.

The Canadian Taxpayers Federation (CTF) consistently highlights dubious spending, outright waste and extravagant programs: “$30 billion in subsidies to multinational corporations like Honda, Volkswagen, Stellantis and Northvolt. Federal corporate subsidies totalled $11.2 billion in 2022 alone. Shutting down the federal government’s seven regional development agencies would save taxpayers an estimated $1.5 billion annually.”

The CTF also noted that Ottawa hired 108,000 additional staff over the past eight years, at an average annual cost of more than $125,000 each. Hiring based on population growth alone would have added just 35,500 staff, saving about $9 billion annually. The scale of waste is staggering. Canada Post, the CBC and Via Rail collectively lose more than $5 billion a year. For reference, $1 billion could buy Toyota RAV4s for over 25,600 families.

Ottawa also duplicates functions handled by provincial governments, often stepping into areas of constitutional provincial jurisdiction. Shifting federal programs in health, education, environment and welfare to the provinces could save many more billions annually. Poor infrastructure decisions have also cost Canadians dearly—most notably the $33.4 billion blown on what should have been a relatively simple expansion of the Trans Mountain pipeline. Better project management and staffing could have prevented that disaster. Federal IT systems are another money pit, as shown by the $4-billion Phoenix payroll debacle. Then there’s the Green Slush Fund, which misallocated nearly $900 million.

Even more worrying, the rapidly expanding Old Age Supplement and Guaranteed Income Security programs are unfunded, unlike the Canada Pension Plan. Their combined cost is already roughly equal to the federal deficit and could soon become unmanageable.

Canada is sleepwalking toward financial ruin. A Canadian version of DOGE—Canada Accountability, Efficiency and Transparency Team, or CAETT—is urgently needed. The Office of the Auditor General does an admirable job identifying waste and poor performance, but it’s not proactive and lacks enforcement powers. At present, there is no mechanism in place to evaluate or eliminate ineffective programs. CAETT could fill that gap and help secure a prosperous future for Canadians.

Ian Madsen is a senior policy analyst at the Frontier Centre for Public Policy.

The views, opinions, and positions expressed by our columnists and contributors are solely their own and do not necessarily reflect those of our publication.

© Troy Media

Troy Media empowers Canadian community news outlets by providing independent, insightful analysis and commentary. Our mission is to support local media in helping Canadians stay informed and engaged by delivering reliable content that strengthens community connections and deepens understanding across the country.

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Trump says he expects ‘great relationship’ with Carney, who ‘hated’ him less than Poilievre

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From LifeSiteNews

By Anthony Murdoch

U.S. President Donald Trump implied that he was satisfied with Mark Carney winning the 2025 Canadian federal election, calling him a “nice gentleman” who “hated” him less than Conservative leader Pierre Poilievre.

“I think we are going to have a great relationship. He called me up yesterday and said, ‘Let’s make a deal,’” said Trump on Wednesday when asked about Carney and Monday’s election results.

Trump then said that Carney and Poilievre “both hated Trump,” but added, “It was the one that hated Trump I think the least that won.”

“I actually think the conservative hated me much more than the so-called liberal, he’s a pretty liberal guy,” he said.

Trump said that he spoke with Carney already, and that “he couldn’t have been nicer. And I congratulated him.”

“You know it’s a very mixed signal because it’s almost even, which makes it very complicated for the country. It’s a pretty tight race,” said Trump.

Trump then called Carney a “very nice gentleman and he’s going to come to the White House very shortly.”

Monday’s election saw Liberal leader Carney beat out Conservative rival Poilievre, who also lost his seat. The Conservatives managed to pick up over 20 new seats, however, and Poilievre has vowed to stay on as party leader, for now.

Back in March, Trump said at the time he had “an extremely productive call” with Carney and implied that the World Economic Forum-linked politician would win Canada’s upcoming federal election.

Trump, mostly while Justin Trudeau was prime minister, had repeatedly said that Canada should join the United States as its 51st state. This fueled a wave of anti-American sentiment in Canada, which saw the mainstream press say Poilievre was a “Trump lite” instead of Carney.

Poilievre at the time hit back at Trump, saying that the reason Trump endorsed Carney was that he “knows” he would be a “tough negotiator.”

Trump’s comments regarding Carney were indeed significant, as much of the debate in the mainstream media ahead of the election was about how the prospective leaders will handle tariff threats and trade deals with America.

Many political pundits have said that Carney owes his win to Trump.

Carney’s win has sparked a constitutional crisis. Alberta Premier Danielle Smith, as reported by LifeSiteNews, said that her province could soon consider taking serious steps toward greater autonomy from Canada in light of Carney’s win.

Under Carney, the Liberals are expected to continue much of what they did under Trudeau, including the party’s zealous push in favor of abortion, euthanasia, radical gender ideologyinternet regulation and so-called “climate change” policies. Indeed, Carney, like Trudeau, seems to have extensive ties to both China and the globalist World Economic Forum, connections which were brought up routinely by conservatives in the lead-up to the election.

Poilievre’s defeat comes as many social conservatives felt betrayed by the leader, who more than once on the campaign trail promised to maintain the status quo on abortion – which is permitted through all nine months of pregnancy – and euthanasia and who failed to directly address a number of moral issues like the LGBT agenda.

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