Prime Minister Justin Trudeau, fighting for his political life three weeks away from an election, is seeking a second mandate from voters to increase the nations debt to deliver tax cuts and spending.
In a costed platform released Sunday, the incumbent Liberals detailed a $57 billion plan over four years worth about half a per cent of annual gross domestic product and pledged to pay for it with fresh borrowing, should they retain power.
The plan represents a doubling down by Trudeau on deficit spending his team says is needed to stoke growth and provide struggling households, many of them with high levels of personal debt, with help. The prime ministers critics, however, say the Liberals have been spending too much in good times and arent setting enough fiscal ammunition aside for when a recession hits.
Under the Liberal plan, Canadas deficit would peak at $27.4 billion next year, bringing it above 1 per cent of GDP for the first time since 2012, before dropping to $21 billion by 2023. That far exceeds the $14 billion deficit recorded in 2018. In total, the plan would add an additional $31.5 billion in deficits and bring the cumulative budget gap over the next four years to $93 billion.
Politically, the Liberals hope the higher deficits will give them a potential wedge issue in a campaign where the two major parties have rolled out similar policy objectives from tax cuts to helping first time home buyers and seniors. Conservative Leader Andrew Scheer has yet to release his full fiscal projection but has promised to eventually return the budget to balance, though only over five years.
In fact, given Scheers reluctance for a quick return to balance, both the Liberal and Conservative plans are poised to deliver a boost to the economy next year, no matter who wins. Its perhaps even enough to prompt the Bank of Canada to reconsider cutting interest rates, according to Jean-Francois Perrault, chief economist at Bank of Nova Scotia in Toronto.
It seems clear whoever is in power, you are looking at a bigger deficit than had there not been an election, Perrault said in a telephone interview.
Opinion polls show the Liberals are running neck and neck with the Conservatives, despite Trudeaus campaign being jolted by revelations he wore black and brownface makeup numerous times as a younger man. Seat projections tabulated by the Canadian Broadcasting Corp. show neither party holding enough support to win a majority.
Deficits matter in Canada, with a collective aversion to debt that was cemented in the mid-1990s amid ratings agency downgrades, a falling currency and a national unity crisis. It remains an explosive issue, even though Trudeaus deficits have hovered at less than 1 per cent of GDP, far below many other western nations. The U.S. budget deficit is close to 5 per cent of GDP.
In the 2015 election campaign, Trudeau pledged to run deficits but for only three years and no more than a cumulative $25 billion. By 2019, Canadas budget would be back in balance.
Since taking power however, his budget gaps have escalated and Trudeau has abandoned any willingness to balance the budget. In fact, hes using his deficits as a lever to attack the opposition Conservatives, claiming they plan to bring austerity measures that will slow the economy and eliminate government services.
I will let the Conservatives explain why cuts and austerity if they really think so are going to help Canadians, Trudeau told reporters at a Toronto-area campaign stop Sunday.
Deficit Track
Trudeaus first three budgets were in the negative by a cumulative $52 billion. His last budget in March projected a deficit for the current fiscal year of about $20 billion.
The Liberals would retain their existing fiscal anchor, which is to keep the nations debt as a share of GDP on a downward trajectory but just barely. The debt-to-GDP ratio would fall to 30.2 per cent by 2023, from 30.9 per cent last year. Thats well above the 28.6 per cent the government had projected in four years time in its last budget in March. They also pledged to preserve Canadas AAA credit rating.
There are new revenue raising measures, totalling $25.4 billion over four years, in the Liberal platform.
The tax measures announced Sunday are short on details, but will be focused on corporations and wealthier Canadians, according to the documents. The Liberals believe they can raise an additional $2 billion as early as next year by undertaking a new comprehensive review of government spending and tax expenditures, to ensure that wealthy Canadians do not benefit from unfair tax breaks.
They also expect to raise $1.7 billion in 2020 by cracking down on corporate tax loopholes that allow companies to deduct debt. Other new measures include a 3 per cent value-added-tax on digital companies with worldwide revenue of more than $1 billion. It would take effect April 1 and be expected to raise more than $500 million next year. The Liberals also plan to impose a 10 per cent luxury tax on cars and boats worth more than $100,000.
Bloomberg.com
Read more here:
Liberal promises will lead to four more years of deficits, each above $20 billion - Financial Post
- Paul Krugman - The Conscience of a Liberal - December 11th, 2016 [December 11th, 2016]
- Liberal Democrat Voice - December 11th, 2016 [December 11th, 2016]
- Urban Dictionary : liberal - December 12th, 2016 [December 12th, 2016]
- READ MORE : Liberal groups want delay of Sessions' hearing - January 5th, 2017 [January 5th, 2017]
- What Is a Liberal - What Is Liberal Bias - January 9th, 2017 [January 9th, 2017]
- Liberal Party of Australia - Wikipedia - February 1st, 2017 [February 1st, 2017]
- Conservatives reject liberal humor in Trump era: Dave Berg - USA TODAY - February 7th, 2017 [February 7th, 2017]
- Liberal Judicial Activism Borders On Insurrection - Daily Caller - February 7th, 2017 [February 7th, 2017]
- Liberal Fake News Reportedly Growing - Yahoo News - February 7th, 2017 [February 7th, 2017]
- House Science Chairman Sees Liberal Cover-Up on Warming Pause - Scientific American - February 7th, 2017 [February 7th, 2017]
- Furious Liberal MPs turn on 'rat' Cory Bernardi - The Australian Financial Review - February 7th, 2017 [February 7th, 2017]
- 'Rallying point': Abbott to headline conservative Liberal fundraiser in Melbourne - The Age - February 7th, 2017 [February 7th, 2017]
- I'm A Liberal, And I Want Milo Yiannopoulos On My Campus - Huffington Post - February 7th, 2017 [February 7th, 2017]
- Cory Bernardi says he resents being used in Liberal party 'proxy war' - The Guardian - February 7th, 2017 [February 7th, 2017]
- HuffPo's New Editor In Chief Is Already Undoing Arianna's Liberal Legacy - Daily Caller - February 7th, 2017 [February 7th, 2017]
- Why Are Liberals Surprised by the Senate Confirmation of DeVos? - National Review - February 7th, 2017 [February 7th, 2017]
- Liberal Hashtag #NotMySuperBowlChamps Protests Patriots' Support of Trump - Fox News Insider - February 7th, 2017 [February 7th, 2017]
- All liberals are hypocrites. I know because I am one - Quartz - February 7th, 2017 [February 7th, 2017]
- '9th Circus'? Scholars Say Court's Liberal Rep Is Overblown - ABC News - February 7th, 2017 [February 7th, 2017]
- Economic freedom - Wikipedia - February 8th, 2017 [February 8th, 2017]
- Liberal land - Richfield Reaper - February 9th, 2017 [February 9th, 2017]
- Liberal groups file lawsuit to block Trump's deregulation order - Washington Examiner - February 9th, 2017 [February 9th, 2017]
- Strategies for Saving the Liberal Arts - Inside Higher Ed (blog) - February 9th, 2017 [February 9th, 2017]
- This day in Liberal Judicial ActivismFebruary 9 - National Review - February 9th, 2017 [February 9th, 2017]
- The Marco Rubio knockdown of Elizabeth Warren no liberal media outlet will cover - Conservative Review - February 9th, 2017 [February 9th, 2017]
- Wisconsin Gov. Scott Walker proposes surprisingly liberal budget - Chicago Tribune - February 9th, 2017 [February 9th, 2017]
- Why the liberal world order is worth saving - Irish Times - February 9th, 2017 [February 9th, 2017]
- Tim Scott reads racist tweets by 'liberal left' over support for Jeff Sessions - Washington Times - February 9th, 2017 [February 9th, 2017]
- Five tips on having a safe conversation with your liberal spouse or conservative brother - Fox News - February 10th, 2017 [February 10th, 2017]
- Why Liberal Policies Are Terrible For Young People - Power Line (blog) - February 10th, 2017 [February 10th, 2017]
- Trevor Bauer goes on long rant defending tweet about liberal bias - Yahoo Sports - February 10th, 2017 [February 10th, 2017]
- Liberal Tolerance: Sen. Tim Scott Reads His Hate Mail On Senate Floor For Supporting Sessions As AG - Townhall - February 10th, 2017 [February 10th, 2017]
- Claws Out For Ivanka Trump Show Liberal Love For Women Is A Sham - The Federalist - February 10th, 2017 [February 10th, 2017]
- Trump Takes a Running Whack at the Liberal Interventionists - The Nation. - February 10th, 2017 [February 10th, 2017]
- Networks Swoon Over GOP 'Feeling the Wrath' of Liberal Town Hall Protesters - NewsBusters (blog) - February 11th, 2017 [February 11th, 2017]
- Liberals, don't fall into the right's 'identity politics' trap - The Guardian - February 11th, 2017 [February 11th, 2017]
- Liberal pledge: Revamp for 69 outdated schools in $560 million spend - Perth Now - February 11th, 2017 [February 11th, 2017]
- Indians swept by Liberal in WAC action - Hays Daily News - February 11th, 2017 [February 11th, 2017]
- Trump's attacks on the press and how the liberal media myth has empowered him - Salon - February 11th, 2017 [February 11th, 2017]
- The Paranoid Style of Anti-Trump Politics - National Review - February 12th, 2017 [February 12th, 2017]
- What the Liberal-One Nation preference deal could mean at the ballot box - ABC Online - February 12th, 2017 [February 12th, 2017]
- Finley: Left bites Ivanka's liberal hand - The Detroit News - February 12th, 2017 [February 12th, 2017]
- A new, liberal tea party is forming. Can it last without turning against Democrats? - Washington Post - February 12th, 2017 [February 12th, 2017]
- Since When Is Being a Woman a Liberal Cause? - The New York ... - New York Times - February 12th, 2017 [February 12th, 2017]
- This liberal Brooklynite is on the hunt for conservative friends - New York Post - February 12th, 2017 [February 12th, 2017]
- Small-l liberal voters have been abandoned in the race to the right - The Sydney Morning Herald - February 12th, 2017 [February 12th, 2017]
- Rich, Liberal Celebrities Lecture and Claim to Stand for 'We the People' at the 2017 Grammys - NewsBusters (blog) - February 13th, 2017 [February 13th, 2017]
- WA One Nation candidates refuse to preference Liberals - ABC Online - February 13th, 2017 [February 13th, 2017]
- India's liberal bubble has shrunk to irrelevance in the age of Narendra Modi - Quartz - February 13th, 2017 [February 13th, 2017]
- Liberal superhero Justin Trudeau is not immune to the forces of Trump - CNN - February 13th, 2017 [February 13th, 2017]
- A new satire must emerge one that breaks out of the liberal bubble - The Guardian - February 13th, 2017 [February 13th, 2017]
- A liberal Tea Party, the pope helps spring a terrorist and other notable commentary - New York Post - February 13th, 2017 [February 13th, 2017]
- At Ole Miss, a Liberal Agitator's Education - New York Times - February 13th, 2017 [February 13th, 2017]
- Liberal Frenzy: 'Impeach' Trump; 'Traitor! Resign by Morning' - CNSNews.com - February 14th, 2017 [February 14th, 2017]
- Chelsea Clinton future run for political shunned by liberal activists ... - Washington Times - February 14th, 2017 [February 14th, 2017]
- One Nation could gain more than the Liberals from Western Australia seats deal - The Guardian - February 14th, 2017 [February 14th, 2017]
- Conservatives: Walker's budget plan is anything but 'liberal' - Watchdog.org - February 15th, 2017 [February 15th, 2017]
- Trump Says Liberal Media 'Going Crazy With Blind Hatred' - Daily Caller - February 15th, 2017 [February 15th, 2017]
- I'm a bleeding-heart liberal cleric but the Church of England must not accept gay marriage - Telegraph.co.uk - February 15th, 2017 [February 15th, 2017]
- What's a Liberal to Do When His Spouse Is a Trump Zealot? - New York Times - February 15th, 2017 [February 15th, 2017]
- Liberal Activists Join Forces Against a Common Foe: Trump - New York Times - February 15th, 2017 [February 15th, 2017]
- John Howard backs Liberal preference deal with One Nation in WA - The Guardian - February 16th, 2017 [February 16th, 2017]
- Liberal ex-MP who called party a 'gay club' likely to be kicked out - The Australian Financial Review - February 16th, 2017 [February 16th, 2017]
- New Liberal PAC Targets Democrats for Primaries - NBCNews.com - February 16th, 2017 [February 16th, 2017]
- 'Liberals will continue to lose': Bill Maher defends Milo Yiannopoulos booking after panelist boycotts - Washington Post - February 16th, 2017 [February 16th, 2017]
- Whatever happened to liberal Democrats, anyway? - Chicago Tribune - Chicago Tribune - February 16th, 2017 [February 16th, 2017]
- Sportswriting Has Become a Liberal Profession Here's How It Happened - The Ringer (blog) - February 16th, 2017 [February 16th, 2017]
- If the Church of England continues to smother liberal Anglicans, it is heading for a split - Telegraph.co.uk - February 16th, 2017 [February 16th, 2017]
- Major liberal group opposes Gorsuch confirmation - USA TODAY - February 16th, 2017 [February 16th, 2017]
- The True Origins of the Phrase 'Bleeding-Heart Liberal' - Atlas Obscura - February 17th, 2017 [February 17th, 2017]
- Liberals, Tories spar over Islamophobia motion in full-day debate - The Globe and Mail - February 17th, 2017 [February 17th, 2017]
- Where Have All the Liberal Democrats Gone? - Townhall - February 17th, 2017 [February 17th, 2017]
- Vicious attacks on Ivanka Trump exposes liberal hypocrisy - The Hill (blog) - February 17th, 2017 [February 17th, 2017]
- Can Emmanuel Macron win? Why France is ripe for a liberal resurgence - New Statesman - February 17th, 2017 [February 17th, 2017]
- Victorian Liberals: factional fight exposes deep divisions - The Age - February 17th, 2017 [February 17th, 2017]
- 10 Unfortunate Liberal Myths Conservatives Often Believe - Observer - February 17th, 2017 [February 17th, 2017]
- Terri Lovell: Liberal oppression - Santa Clarita Valley Signal - February 17th, 2017 [February 17th, 2017]
- Where's the liberal outrage over civil liberties in the Flynn case? - Minneapolis Star Tribune - February 18th, 2017 [February 18th, 2017]
- Liberal, conservative Jews in US increasingly divided over Trump - Chicago Tribune - February 18th, 2017 [February 18th, 2017]
- Anti-Islamophobia debate might define both Liberals and Conservatives - CBC.ca - February 18th, 2017 [February 18th, 2017]