Juno News - April 11, 2022


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


Episode Stats

Length

25 minutes

Words per Minute

173.55177

Word Count

4,407

Sentence Count

269


Summary


Transcript

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
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
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.