Juno News - Nothing “modest” about Trudeau’s ongoing spending spree (Ft. Franco Terrazzano)

00:00:00.000 Canada is edging closer and closer to a fiscal cliff. Our debt levels will soon hit $1.2 trillion

00:00:05.620 and our annual deficit remains above $50 billion. But the legacy media is trying to tell you that

00:00:11.300 this is a restrained and even conservative budget. We'll cut through all the spin and

00:00:15.900 tell you the real story. I'm Candice Malcolm and this is The Candice Malcolm Show.

00:00:30.000 Everyone, thank you so much for tuning in. So as you saw, the budget, the federal budget was

00:00:35.180 released on Thursday afternoon by Justin Trudeau's finance minister, Chrystia Freeland. She took a

00:00:39.940 break from her major focus, which is the war in Ukraine, and decided to do her secondary job,

00:00:44.900 which is run the finances of Canada. She doesn't do a very good job about it. Well, we took the

00:00:48.940 weekend to read it through very carefully so we can report on all of the hidden details that the

00:00:53.860 Trudeau government doesn't want you to know. So as you saw, Trudeau's faithful lackeys in the

00:00:59.260 parliamentary press gallery were hiding the ball and telling you that this was a budget that was

00:01:03.900 modest, restrained, prudent, and yes, even conservatives, they said that it focused on

00:01:09.740 fiscal responsibility and growing the economy. Of course, the opposite is true. The new deficit is

00:01:15.840 now $52.8 billion. That's how much they're spending every single year, more than what they bring in.

00:01:21.560 New spending in this budget amounted to $56 billion. Our debt is now $1.2 trillion, or will be at the end of

00:01:29.220 the year. That means that each individual Canadian, including yourself, owes $31,000 of that debt.

00:01:35.940 Your children owe $31,000 of that debt. The debt is growing $400 million per day, according to our

00:01:43.360 friends over at the Canadian Taxpayers Federation. And so to help really break this down, we wanted to

00:01:49.440 bring in our friend from the Canadian Taxpayers Federation, Franco Terrizano. Franco is the federal

00:01:55.720 director of CTF. He has a master's degree in public policy and a bachelor in arts and economics.

00:02:01.460 Franco writes about the costs associated with tax increases, inefficient government,

00:02:05.280 unintended consequences of government policies. Franco, it's great to see you. Thank you so much

00:02:09.760 for joining us. Hey, well, thanks so much for having me on today.

00:02:14.100 So tell us about this budget. We've had a couple of days here to digest it and to see how the media is

00:02:20.320 covering it. I want to get your thoughts, though. What does the budget mean? What are the day-to-day

00:02:25.000 impacts of it? Well, we're seeing another credit card budget from this credit card government. And

00:02:30.920 just like all huge credit card tabs, it's really going to come with a sting for taxpayers already,

00:02:36.240 but also down the road. As you mentioned, another huge deficit, right? The third year in a row with

00:02:42.440 massive deficits. Back in 2020, the deficit was over $300 billion. Last year, over $100 billion. This

00:02:48.440 year, still over $50 billion. And of course, with all of that borrowing for years and years and years,

00:02:55.340 it means taxpayers are losing out on a ton of money just to pay interest on the debt. Candace,

00:03:00.460 this is a number that really stuck out to me. Every single month, taxpayers are losing out on more

00:03:06.960 than $2 billion just to pay interest charges on the government's credit card. To put that into more

00:03:12.960 perspective, it means that this year, Canadian taxpayers are paying more just on interest charges

00:03:18.720 on the federal debt than the Alberta government is spending on health care. That's wild. That's

00:03:25.140 incredible. And no wonder our health care system is lagging behind. No wonder our country isn't getting

00:03:30.280 ahead. It's interesting because when you listen to the Liberals and Chrystia Freeland,

00:03:34.680 one of the things I saw her say in an interview with Global was that her focus is on growing the

00:03:40.340 economy. So that's the key focus for Chrystia Freeland in this budget. Well, Rudyard Griffith,

00:03:47.980 who is an editor over at The Hub, he put out a graph from the budget that shows that Canada is

00:03:54.460 dead last in per capita GDP growth for the coming decades, shows less than 1% growth in our GDP,

00:04:02.020 which is way below the OECD average. And yet, at the same time, our government spending is growing

00:04:08.180 by about 2% per year. Is there anything in this budget that you see is actually helpful to growing

00:04:15.380 the economy? Or how can the government justify it in this way? There is very little in there that

00:04:22.440 taxpayers should be happy about in terms of some economic growth. There's a little bit

00:04:27.180 of tax relief for medium-sized businesses by expanding the eligibility to the small business

00:04:32.280 tax rate, which is lower than the corporate tax rate. But there really isn't much in here.

00:04:36.800 In fact, it's the opposite. It looks like this budget is going to continue to fuel inflation.

00:04:42.120 And Candace, the higher cost of living is one of the key issues facing Canadians in our day-to-day

00:04:48.820 lives. You know, this government likes to talk about affordability, but so many Canadians can't

00:04:55.220 afford to fuel up their cars with gasoline or put ground beef in their shopping carts at the grocery

00:05:00.940 store. And one of the reasons is, is because this government is spending like crazy and it's raising

00:05:06.380 taxes. Well, what we're seeing is more debt in this budget. Over the next few years, this budget is

00:05:12.760 going to increase the federal government's $1.2 trillion debt by about $150 billion. We hear the

00:05:21.600 government say they want to reduce the cost of living. Well, trying to fight inflation with all

00:05:27.120 this government debt is like trying to put out a fire with a can of gasoline. It's just going to make

00:05:31.640 these things worse, right? Now let's talk about the tax hikes that we have seen already. We've already

00:05:38.060 seen the carbon tax go up in 2022. We've already seen booze taxes go up in 2022. We've already seen

00:05:44.640 payroll taxes go up in 2022. In this budget, there's going to be a tax on banking and insurance

00:05:51.760 companies. And look, you're not going to see me losing any sleep over big bankers. But what I am

00:05:58.240 going to lose sleep over, what I am worried about is that those costs are going to trickle their way down

00:06:03.920 into higher banking fees that Canadians are going to feel. Right. Like the banks aren't just going to

00:06:10.140 eat the cost. They're going to pass it along to their consumers, to their clients, and Canadians

00:06:14.620 are going to end up paying more for their banking. That's kind of the basic equation that the people

00:06:20.900 in this government don't really seem to understand. I want to talk a little bit about inflation because

00:06:25.720 I noticed that the inflation numbers were worse than what the government's own targets were last year.

00:06:31.180 So this is obviously a problem that they didn't foresee in the way that it has actualized.

00:06:37.960 I like your line there about how trying to ease inflation with more government debt is like

00:06:43.740 putting out a fire with gasoline. So the government shrugs it off and just says this is a global

00:06:49.140 phenomenon. It's not their fault. We are seeing inflation in the United States, who is also in the

00:06:54.440 midst of a spending spree for COVID. I want to ask you, you know, why is inflation growing and what

00:07:01.160 does it mean for the typical Canadian? Well, it means a lot of hardships is what it means for Canadians.

00:07:07.940 And this is real Canadians who are in the private sector, who may have lost their job during the

00:07:12.320 pandemic, who may have taken a pay cut during the pandemic, who may have lost their business.

00:07:16.720 They're feeling the pain of higher prices at the worst possible time. Yeah, it might not feel too

00:07:21.220 painful for the people who are living in their cushy bubbles in Ottawa, who continue to give

00:07:25.780 themselves pay raise after pay raise after pay raise. But for everyday working Canadians in the

00:07:31.160 private sector, it means an awful lot of pain. Now, let's talk about some of these global confusions,

00:07:38.860 if we can call it that. Yeah, other countries are feeling the pain of inflation when these other

00:07:43.720 countries are running massive deficits and have their printing press on overdrive like Canada.

00:07:48.780 But countries that haven't had all this money creation, Japan, Switzerland, aren't dealing

00:07:53.740 with the type of inflation that's happening in Canada. And Candace, I want to address another

00:07:58.780 point of confusion that we often hear is about these supply issues. Well, we always have supply

00:08:06.820 issues. There is always supply issues year after year, whether it's a refinery shutting down,

00:08:12.220 whether it's maybe bad weather, crop disasters. This happens all the time.

00:08:17.360 Yeah, CP strike that happened a couple years ago caused huge supply issues. So you're right,

00:08:23.120 we see it every year. Exactly. But what's different about now, that's leading to 30 decades high

00:08:29.160 inflation. What's different about now is that we just had two years of revolving government

00:08:34.980 lockdowns, which hammers output. We just had the printing press create $370 billion out of thin air,

00:08:43.040 drop it into our economy, meaning the more dollars they print, the less that our dollars buy. So what

00:08:48.780 we've seen now, which is different than before, is the government create the perfect storm for

00:08:53.480 inflation, which is too many dollars chasing too few goods. And then they kind of throw their hands up

00:08:59.240 and just say it's a global phenomenon. It doesn't have anything to do with what we are doing. It's like

00:09:04.460 we're relearning all of the same lessons that I thought we had learned in the 70s and 80s when we were

00:09:09.540 dealing with inflation back then. So what would your advice be to the government to curb this

00:09:13.960 problem? Because you're right, it has such a big impact on Canadians' everyday life, the price that

00:09:18.640 you pay at the grocery store, the cost of gassing up, filling up your car with gas, the cost of

00:09:22.960 buying anything, all of these supply issues. So what do you advise the government do instead?

00:09:28.840 Stop doing what you're doing to make these tough times tougher. Turn off the printing press, right?

00:09:36.280 Stop with these massive inflationary government deficits and crazy overspending. And number three,

00:09:43.440 stop with the tax hikes at the worst possible time. It sounds common sense because it should be

00:09:49.580 common sense. If you're creating inflation with your crazy spending, with your printing press,

00:09:55.580 and with tax hikes, stop doing it. So that's what we're calling on the government. And it's what we

00:10:00.640 have been calling on the government to do for quite some time. Well, I do want to go through

00:10:05.440 some of the way that the media has described this. So Global News Bureau Chief David Aiken tweeted out

00:10:12.160 that this is a very modest budget. Budget measures have a net cost this year of $7.4 billion. Net new

00:10:18.280 spending through fiscal 27 is just $30 billion. Well, that's a little different than the numbers that we

00:10:23.760 have. I calculated the new spending to be $56 billion. Alas, John Iveson in the National Post

00:10:29.960 wrote that for these big spending liberals, this is what a prudent budget looks like.

00:10:35.560 Likewise, Donna McCharles of the Toronto Star tweeted that this may be the most conservative budget

00:10:41.040 the Trader liberals have written yet. I saw Mercedes Stevenson repeat this line on a news report.

00:10:47.540 She said that the government is sending a message of fiscal restraint. And she told us that

00:10:52.320 that Canada is returning to pre-pandemic spending levels. I just want to give you an opportunity,

00:10:58.160 Franco, to reply and to refute any of these messages. Is this an accurate picture of what

00:11:03.500 the budget looked like? No, no, not at all. I mean, in what world is this budget prudent or

00:11:09.440 some type of fiscal responsible? Not on planet Earth, maybe on some type of fantasy land. And here's why.

00:11:15.780 So pre-pandemic, the federal government was spending all time highs. Just let that sink in,

00:11:21.740 we'll get back to it. Now this year, the government is going to be spending about $90 billion more than

00:11:29.440 pre-pandemic, which was already all time high. So back in 2018, 2019, you had the Trudeau government

00:11:36.080 spending more than the federal government did during any single year during World War II,

00:11:40.640 even after accounting for inflation and population differences. And this year, the government wants

00:11:46.460 to spend about $90 billion more than that. So when you hear these numbers like, oh, it's just another

00:11:53.300 $30 billion in new spending, even it's just another $60 billion in new spending, even that undercuts

00:12:00.260 just how big of a spending this budget truly is. $90 billion more this year than what the government

00:12:07.360 want was spending pre-pandemic, which were all time highs. But also, even if you just look at the

00:12:13.220 last fiscal update, even if you look at the last federal budget in 2021, this year's spending is

00:12:19.820 going to outspend both those last targets. So really on all measures, this budget is chock full of

00:12:27.120 more government spending, more government borrowing. That's why we call it the credit card budget from

00:12:32.680 this credit card government, because there's also no plan to return to balance and no plan to start

00:12:38.840 chipping away at the $1 trillion debt problem. It's so interesting because, again, listening to

00:12:44.320 our finance minister, Chrystia Freeland, she said that the focus is on paying down the pandemic debt.

00:12:50.340 She said that that would be the government's fiscal anchor. She said the government's main fiscal

00:12:54.720 indicator is a declining debt to GDP ratio. We know that it was hovering at around 30% pre-pandemic.

00:13:00.120 It's now bumped up to 45%, which means that our debt is almost half the size of our entire economy,

00:13:05.640 which is a pretty terrifying figure, knowing that that doesn't even figure in provincial debt,

00:13:11.020 which is also astronomical. So when you add all those together, I don't even want to start

00:13:16.820 calculating it because I predict or I assume that our debt is bigger than our economy. But again,

00:13:25.580 how do, well, maybe you can help us understand that, but break down those numbers. But how does

00:13:29.800 Chrystia Freeland, with a straight face, tell the Canadian public and tell the media that the

00:13:34.960 government is working to chip away pandemic debt? I didn't see any debt repayments in this budget.

00:13:40.320 I just saw a large interest payment. So maybe you can help us understand that.

00:13:44.400 There is no debt reduction at all. Let's just take that off the table. The debt is right now about

00:13:50.460 $1.2 trillion, about $1.2 trillion. By the end of this fiscal projection, which is 2027,

00:13:57.180 the government will have added nearly $150 billion to the debt. So there is absolutely no debt

00:14:04.420 reduction in this budget, quite the opposite, more debt being layered on top of Canadian taxpayers and

00:14:10.600 their kids and their grandkids. And there's absolutely zero plan on when this government

00:14:15.240 is going to balance the budget. The best that this government is willing to do is to say, hey,

00:14:19.680 sometime in 2026, the deficit will finally be under $10 billion. We're going to finally bring the

00:14:25.300 deficit into single digit billions. But Candace, I mean, why should we even trust them on that?

00:14:31.800 Let's look at, let's look at their track record. Remember back in, what was it, 2014, you had Justin

00:14:36.100 Trudeau saying the budget was going to balance itself. Yeah, that didn't happen. In 2015, when he

00:14:41.780 was running for the office of prime minister, he said he would run a few modest deficits and balance

00:14:47.420 the budget in 2019. Well, it turns out he missed that target by a cool, easy breezy $20 billion.

00:14:54.600 So even the targets in this budget, which are not even close to balance, I think taxpayers have

00:15:01.840 every right to be skeptical of. Now, one point that I want to jump back to is this whole debt to GDP ratio.

00:15:09.020 This is the government's favorite fiscal anchor, so to speak. But still, to your point, it is 15

00:15:16.820 percentage points above pre-pandemic levels, which were already high. But it also doesn't

00:15:22.540 account for provincial government liabilities, which this government has shown that it's all

00:15:27.120 too willing to pick up the tab. Just last year, the feds gave Newfoundland and Labrador a $5.2

00:15:32.520 billion bailout. So when you look at total indebtedness, our debt, our government debt is

00:15:39.360 more than the entire economy produces in a single year. It's over 100% of GDP.

00:15:45.340 That's so terrifying. So I want to ask you, because you mentioned Newfoundland and Labrador,

00:15:50.740 I saw that the government approved a large offshore oil and gas project, which gave me a little bit of

00:15:58.520 a surprise. I didn't expect that from the government. Apparently, drilling for oil out on the east in the

00:16:04.200 east is perfectly fine. Oil in Western Canada, not okay. Were there any positive takeaways from this

00:16:11.780 budget? Anything that you saw that was a good sign for taxpayers?

00:16:15.240 Well, I certainly had to dig pretty hard to find some nuggets of good for taxpayers. But let me put as

00:16:23.140 positive of a spin on this budget as I can for taxpayers. So we kind of touched on it, there is

00:16:28.620 some small and medium sized business tax relief, they are expanding the eligibility for businesses

00:16:35.680 to be able to get that lower tax rate corporate. So yeah, I guess that's, I guess that's some good

00:16:42.380 news for some businesses that do need relief. So, so that's good. There's also going to be some sort

00:16:49.160 of tax free savings account if you want to be a first time home buyer. So you're gonna, you're

00:16:53.880 gonna see a little bit of relief there. But there really isn't much good news for taxpayers, it really

00:16:59.900 is a lot of bad news, especially if you're already worried about the cost of living, which so many

00:17:04.900 millions of Canadians are because you're going to have this debt continue to fuel inflation. Maybe you

00:17:12.480 could say that, well, the only major tax hike seems to be on these banks and insurance companies.

00:17:17.020 But Candace, as we've already talked about, well, who's going to end up really paying that tax,

00:17:21.520 and it's likely going to be Canadian consumers through higher banking fees. And of course,

00:17:25.980 the real pain from this budget comes from having to pay back these huge credit card bills that the

00:17:32.480 Freeland and Trudeau government is racking up. It's interesting. So you talked, you talked about

00:17:36.320 that tax free savings account for first time home buyers. I know that was a pledge that the liberals

00:17:40.600 had made during the 2021 election was almost like a conservative promise, because usually it's

00:17:45.220 conservatives who are trying to incentivize personal savings. That doesn't really address

00:17:49.780 though, Franco, the larger issue, which is the supply of houses. I mean, I think one of the biggest

00:17:55.520 issues in Canada is just the cost of buying a home. So many young Canadians, so many people

00:18:00.020 under the age of 30, even under the age of 40, are being blocked out of home ownership. And it really

00:18:05.180 hurts people trying to, you know, go on to that next stage of life, having a family, having kids,

00:18:10.200 that sort of dream of living in the suburb, not really available. So, so helping, you know,

00:18:15.660 people who already have savings, who are already on the pathway towards home ownership,

00:18:20.460 doesn't do anything to address the astronomical costs of housing. I read that the average single

00:18:27.480 family home in Ontario now is over $1.2 million. Imagine, you know, a 25 year old or a 30 year old,

00:18:34.600 even trying to afford that kind of proposition. It seems impossible. And so the idea of a tax-free

00:18:42.040 account is really just, it's like window dressing. It doesn't, it doesn't, it doesn't do anything to

00:18:48.940 impact the root of the problem, which is that housing is so expensive, which is because there

00:18:52.960 just isn't enough housing in and around Toronto, but it's also a problem all over Canada. I know

00:18:57.980 it's a huge problem. Vancouver has been for decades, but increasingly a problem in places like Edmonton

00:19:03.240 and Calgary as well. So I guess, I wonder if you can comment on things that the government could do,

00:19:10.060 because another thing, Christy Freeland talked about how this was a supply side budget, which is

00:19:14.060 kind of taking a page from Ronald Reagan, John F. Kennedy, the conservatives that, that they would

00:19:20.160 focus more on, on the supply side economy. I didn't see anything that was actually supply side. So again,

00:19:25.960 the government is saying things that aren't reflective of reality. And when we look at the actual

00:19:32.200 situation, they're not addressing the supply side, they're just kind of trying to help people save

00:19:36.260 up money, which again, increases demand because more people will be able to buy houses. So maybe

00:19:42.620 you can comment on that and the confusion there. Well, you know, the housing issue is a huge issue

00:19:49.420 and it's a complex one. And just quite frankly, it's not just the federal government issue. You're also

00:19:54.800 going to have to look at provincial governments and also really municipal governments as well with

00:19:58.660 regulations, zonings, property taxes, things of that nature. But there's two things that governments

00:20:04.660 as a whole need to do in Canada. And one of the big ones is, is the federal government. Number one,

00:20:10.760 stop the printing press, stop ballooning assets. That is what fuels and drives demand. Easy money

00:20:18.800 policies that drive interest rates low, fuel demand, pump new money into the system, balloon assets.

00:20:24.740 So that is a big thing that the federal government could just stop doing right away to stop ballooning

00:20:30.300 these assets. But of course, number two is, as you've mentioned, you have to build homes. And of

00:20:36.700 course you build homes with hammers and nails, not with tax hikes. A thing that the CMHC, the Canada

00:20:43.780 Housing or Mortgage Housing Corporation, the Crown Corporation federally seems to totally not

00:20:49.620 understand. Because Candace, of course, the CMHC, which is a federal crown corporation is taking 0.51

00:20:55.720 our tax dollars to fund report a report that recommends tax hikes to somehow cool off the

00:21:02.820 housing market. Well, this must be the first tax increase in history that is going to somehow

00:21:07.360 reduce prices, right? Well, well, we've done it. We've changed the law of economics. But of course,

00:21:12.800 that's not how things happen in the real world. And these types of home taxes that reports like this

00:21:18.320 are recommending would just increase the cost of homes, either with homeowners adding on to the

00:21:26.020 price, the tax, or just deciding not to sell and avoiding the tax, which again would reduce supply.

00:21:31.660 So Candace, as you talked about, governments, not just the federal government, have to encourage

00:21:37.100 more homes to be built. And largely, that's just getting out of the way. That's not spending more

00:21:42.860 money driving up demand. It's getting out of the way, cutting back on these crazy types of

00:21:47.600 regulations. And number two, you got to turn off the printing press, which is ballooning all types

00:21:53.160 of assets, all types of prices, including home prices. That's a really good point. One of the

00:21:58.880 other things I noticed in this budget is it's chock full, as you expect from a true budget with woke 0.85

00:22:04.300 pet causes. So there's lots of money to those rainbow rights coalition. There's something called

00:22:10.100 menstrual equity in the budget. Yes, you heard that correct. Menstrual equity. Apparently,

00:22:15.200 they're going to make women's menstruation equal to all people. And as Tristan Hopper wrote about in

00:22:20.920 the National Post, tax exempt sperm. We also heard Chrissy Freeland sort of praising herself for women's

00:22:29.600 liberation. She said it was a women's economic policy budget. And she was patting herself on the

00:22:35.380 back and applauding herself, saying that she had solved the decades along a feminist issue of what,

00:22:43.100 you know, balancing work and childcare for kids by providing more government daycare, I guess. So I

00:22:51.020 wonder if there were any of these woke pet causes that popped out to you, really useless spending or

00:22:57.660 wasteful spending that you saw on the budget? Well, there was two big ticket items that really caught my

00:23:03.380 guide. Number one was what they're calling this growth fund. $15 billion in this fund. $15 billion

00:23:10.220 is a ton of money for starters. But there wasn't very much details. Essentially, what it sounds like,

00:23:16.060 what it smells like is this huge corporate welfare slush fund that they're going to be throwing around

00:23:21.440 at this business, that sector, that industry here and there. But look, this government couldn't balance

00:23:27.980 the budget of a lemonade stand. And now it somehow thinks that it can be an investment banker with $15

00:23:33.760 billion worth of taxpayers money. Come on, I say no, thank you. Like just return the $15 billion to us

00:23:40.240 through lower taxes. And we'll take it from here. Let Canadian families and businesses grow the economy.

00:23:45.560 We don't need these bureaucrats running around. But the second thing that really caught my eye was

00:23:50.600 there's going to be a billion dollar government agency created to focus on innovation. Well, Candace,

00:23:56.700 have you ever heard a bigger oxymoron than that? A government agency for innovation? Like, come on.

00:24:05.220 It's crazy the things that they'll come up with to spend money on. And your point, like,

00:24:09.460 wouldn't you rather have investors and people who understand industry, people who come from

00:24:13.680 certain backgrounds that they can choose for themselves where to invest and where to innovate

00:24:18.960 instead of, to your point, having centralized bureaucrats in Ottawa? It doesn't seem like

00:24:23.600 there's a problem in the world that the Trudeau Liberals don't think that they can solve through

00:24:30.120 more spending. Well, Franco, I really appreciate your time. Thank you for all your efforts pouring

00:24:35.620 through this budget so that we don't have to. Lots of problems. And we applaud all the efforts

00:24:41.740 of the Canadian Taxpayers Federation. So thank you for joining us.

00:24:45.620 Well, hey, thank you so much for having me on today.

00:24:47.940 All right. That's Franco Teresino. I'm Candace Malcolm. And this is The Candace Malcolm Show.

00:24:53.600 Thank you.

Juno News - April 11, 2022

Nothing “modest” about Trudeau’s ongoing spending spree (Ft. Franco Terrazzano)

Episode Stats

Summary

Transcript