
The latest budget proves all members of the Liberal and NDP party need a basic economics and financial planning course. They need to learn balancing the books will result in higher tax revenue in the future because it allows for a competitive tax-rate that attracts investment into the country. This capital inflow increases GDP which includes job creation and results in additional tax revenue that can accommodate lower taxes in the future. Foreign investment also puts upward pressure on the currency which creates wealth for all Canadians. Every country with a weak currency always has a lower standard of living compared to a country with a strong one.
The budget increases our already out-of-control debt. It is estimated that Ottawa will pay $45b ($1,100 per breathing Canadian) in interest charges this year alone. This assumes debt and interest rates do not increase from today’s levels. The interest creates wealth and jobs for very few whereas investments in things like healthcare, military, natural resources, and infrastructure is what create a robust economy, and more tax revenue.
The Liberals could easily balance the books by cutting the size of government (and allowing our resources to be developed). Last year, 335,957 people worked for the federal government – up 30.7% from 2015, meanwhile our population grew by 8.5%. The size of Parliament can be slashed as well. Why do we have one of the world’s largest number of cabinets and allow it to accomplish nothing meaningful? There are 39 of them managed horribly by 40 ministers and many overlap. Furthermore, what is the purpose of these bureaucrats when Ottawa goes out and hire consultants to do the same job? Most governments are successful with 10 cabinets. Any job losses will be welcomed by the private sector.
Trudeau and his climate extremism is the problem. It is well laid out in the budget. Things like the Carbon Tax scares capital away from Canada. This costs jobs and profits which can be directed at research and design. We are leaders in clean energy and technology and have made some of the largest strides lowering GHG’s in the world, but our airhead PM is slowing innovation and the speed at which he wants to achieve his goal of beating climate change. He makes zero sense.
Attempting a move off fossil fuels will prove to be an economic nightmare. According to the Liberals the switch will cost at least $60 billion to $140 billion per year to reach net-zero by 2050. The Budget read, “it will be up to the private sector to make the majority of these investments, but to avoid the consequences of underinvestment, it is critical that governments invest in policy frameworks capable of mobilizing private capital.” This statement is humorous because it points out that private capital does not see longevity in the sector and is staying away. Otherwise, there would be no need for “frameworks capable of mobilizing private capital” because money always travels to the highest return.
It makes more sense to cut taxes rather than hand out rebates and create administration costs in the process. The most productive budget would move towards a flat tax on all income. This lowers the expense of tax collection, increases honesty amongst taxpayers, and attracts business. Plus, people and business can spend money more responsibly than any government can.
Perhaps the only nice thing about the budget is the number of corporate tax credits for making green investments. This may be the only positive because the industry is not profitable and will most likely not be before the credits expire, so there will be little loss to taxpayers. Other than that, it shows Canada is a leaderless country drifting further into financial trouble. Any more budgets like this one and our dollar will sink to the low sixties. This means every Canadian will become 18% poorer from today and almost 40% worse off in the global economy since Trudeau got into power. This will help Trudeau’s goal of making Canada a third world country.
Ottawa must be cleaned out today. We are sliding down the economic ladder because of environmental concerns that humans cannot control. Everyone in Ottawa lives in a fantasy land when the world knows coal and natural gas are going to be the main source of energy for decades to come. This government has caused both foreign and domestic investment dollars to leave by the trillions, driving our dollar down in the process and lowering Canadians wealth. It has resulted in higher energy bills, no improvement to the environment, and has not prevented CO2 levels from increasing.
Thankfully, JT will be gone in 2025, at the latest. When he is gone, we will reopen our economy to the world. The low Loonie is temporary. There is no point in buying foreign currency today because that boat has sailed. As soon as it looks like the Trudeau and his puppets are gone, our dollar will climb to over $0.80 just simply because of foreign investment returning. Invest for dividends and build a moat with 50% of your portfolio in one-year GIC’s, depending on your age. There are some great long-term opportunities out there too, so do not be afraid to dip your toes into the market.
