Trudeau Continues Deficit Spending With Canada’s Annual Budget

REUTERS/Trish Badger

David Krayden Ottawa Bureau Chief
Font Size:

Canadian Prime Minister Justin Trudeau continued on a path of deficit spending with the release of the federal government budget Wednesday afternoon.

The document was entitled “Building a Strong Middle Class” but it also continued to build government debt. Finance Minister Bill Morneau described the budget as being “about jobs. It’s about creating good middle class jobs today, while preparing Canadian for the jobs of tomorrow.”

That talk translates into spending $1.8 billion on skills and innovation training.

There is virtually no reference to Canada’s military in the budget, despite an encroaching need to replace the Royal Canadian Air Force’s CF-18 fighter jets and the growing challenges of a ship-building project for the Royal Canadian Navy that is behind schedule. President Trump has reminded all NATO members of their promise to spend 2 percent of their country’s GDP on defence spending; Canada currently spends about half of that.

About $8.5 billion in capital acquisition spending that was promised for the Canadian Armed Forces has been quietly placed as a future option and and not an immediate priority.

The Liberals did find money “to advance Canada’s efforts to build a clean growth economy,” although the province of Ontario has demonstrated that green energy is not only woefully inadequate to meet private and public needs but extremely costly.

Canada’s single-payer, taxpayer-funded, universal health care system, which devours a large portion of the budget, will receive additional funding to “reduce waiting times” for mental health services. Ottawa will transfer $37.1 billion in the next fiscal year to maintain the national healthcare program.

Trudeau also proudly announced that this year’s budget is the first that includes a “gender statement,” which “serves as a basis for ongoing, open and transparent discussions about the role gender plays in policy development.” This gender statement was apparently used in factoring how much money was allocated to various programs.

The budget also announced the Liberal government’s intention to “advance reconciliation with Indigenous Peoples” though this reconciliation has often consisted of funneling more money into a reserve system that native leaders themselves admit is broken.

Though the budget does not articulate a plan for reaching a zero deficit budget or reducing the national debt, Trudeau resisted the temptation to spend even more because many of the programs announced will not be funded for many years down the road.

“We will continue to invest in our people, our communities, and our economy while maximizing every dollar and ensuring it is well spent,” Finance Minister Bill Morneau said in the House of Commons.

In order to find more revenue, Morneau announced a new tax on ride-sharing ventures like Uber, and an anticipated increase in the sin taxes on alcohol and tobacco products.

Some of the other spending initiatives include:

  • $691.3 over five years to expand the caregiver benefit for Canadians supporting critically ill and injured family members;
  • $395.5 over three years to expand the youth employment strategy;
  • $279.8 million over five years for the temporary foreign workers program;
  • $57.8 million for mental health for federal inmates;
  • $50 million over two years for teaching initiatives to help children learn to code; and
  • $27.5 million for programs to help newcomers get foreign credentials.