True Patriot Love - Canada’s $61 Billion Deficit： Why No One’s Talking About It!

00:00:00.200 Welcome, everyone. Today we're here. I've invited Mike Wixen to be with me today. Welcome, Mike.

00:00:06.260 Thank you very much.

00:00:07.320 So, this is podcast three. We started off and we did the annual report for the federal government.

00:00:16.160 And we went through revenues, then we did expenses.

00:00:19.020 And today we're going to talk a little bit about deficit and GDP.

00:00:23.160 But you know what? I was coming in and I just wanted to start off.

00:00:26.060 I was coming in and I read a report. I haven't dug into it yet, but it's very interesting.

00:00:31.960 And it reminded me of the Arrive Scan podcast that we did.

00:00:38.940 The misappropriation?

00:00:40.300 Yeah, of $60 million, right? 19 going to those two gentlemen.

00:00:45.140 And I'm driving in and the Women's Entrepreneurship Fund was what they were talking about, right?

00:00:52.380 And apparently it was supposed to go to a startup organizations that are the ladies startup. 1.00

00:01:00.460 And quite frankly, they didn't do that.

00:01:03.540 They actually gave it to existing companies.

00:01:05.760 And it kind of hit home for me because being an entrepreneur and knowing how hard it is to lift a company,

00:01:10.960 I'm thinking to myself, why did we spend $130 million, $130 million on this and not have parameters of a program figured out?

00:01:19.600 So I'm going to get back to it today, but I really wanted to jump into it right away with you.

00:01:24.340 Yeah, $130 million just thrown to the wind, if that's what has occurred here, that's just symptomatic.

00:01:32.200 Yeah, it's symptomatic.

00:01:33.200 And quite frankly, when you're running a $61 billion deficit, and that's what we did do in 2024, you know, $130 million counts.

00:01:42.040 And so, you know, whether it be the Green Slush Fund, whether it be the Entrepreneurship Fund, whether it be Arrive Scan, quite frankly, those are the challenges.

00:01:51.980 And so what I wanted to do is, you know, I brought it up.

00:01:54.380 It really bothered me when I was coming in.

00:01:56.080 So let's kick it off, and I look forward to having a good show.

00:02:02.200 Paul, before the show, and by the way, this has got to be the most prepped I've ever been for a show because this is disturbing.

00:02:24.100 And before the show, you and I went around asking the crew and everyone in the lobby downstairs what the federal government spent in fiscal 2024 was.

00:02:34.680 And guess what?

00:02:37.220 No one knew what the expenditures were.

00:02:39.880 In fact, and I can imagine because the crew here in the building, they're savvy, and the demographics are pretty wide.

00:02:46.280 So we've got a wide range of people here, a wide array of people here.

00:02:50.760 They probably know more than the ministers what's going on on a day-to-day basis.

00:02:57.640 Why are we not hearing from our government?

00:03:01.640 It's their job.

00:03:02.660 Why are all of them not talking about it more?

00:03:05.200 I find it ridiculous how Canadians and their government, all conservatives, liberals, NDP, and bloc, just do not know what the numbers are.

00:03:14.800 Nobody seems to understand what the numbers are in this fiscal spend.

00:03:21.340 Canadians are mostly conservative when it comes to spending.

00:03:24.220 I think that's the truth.

00:03:25.640 Oh, yeah.

00:03:26.140 And at the federal level, like, I don't need to know.

00:03:31.420 It's totally bizarre.

00:03:32.220 No, take us through why we don't have a better understanding of this.

00:03:36.520 To me, it just seems ridiculous that as Canadians, we don't have an understanding immediately of what our debt is and what our spending levels are.

00:03:46.160 Oh, yeah.

00:03:46.700 No, it is crazy.

00:03:48.080 You know, and I laugh because what you're asking me to do is slam my fellow Canadians and whatever party they represent.

00:03:55.140 But you know what?

00:03:56.980 It's a mess.

00:03:57.820 Let's be candid, you know, and the deficit's grown and grown.

00:04:02.580 And it's bizarre that the population doesn't know why.

00:04:05.600 So, you know, we get knocked around the world for being fairly frugal, right?

00:04:10.620 You know, you go down to Florida and you watch a bunch of people walking on the beach and all the Americans are making fun of Canadians and how bad tippers we are and everything else.

00:04:20.840 So, you know what?

00:04:22.020 You think to yourself, okay, well, then how the heck do we not pay attention to our finances for our country?

00:04:29.040 Because I know we pay attention to ourselves and our businesses.

00:04:33.060 So, you know, let me recap a little because I think this is really key for, you know, this discussion.

00:04:39.100 I spent two podcasts and I went through the revenues, the federal revenues for 2024.

00:04:44.900 And what I did is I took a look at the annual reports of the federal government.

00:04:48.500 2024 versus 2019.

00:04:52.580 I wanted to kind of get myself clear of COVID because COVID is a big blip in the radar, right?

00:04:57.820 We spent $327 billion on COVID.

00:05:02.120 So that contributed a lot to the net deficit or debt of the country.

00:05:08.400 So I wanted to get clear of that.

00:05:09.940 And I wanted to look at what we were doing before and what we were doing after.

00:05:13.180 And I really wanted to take a look and see why we didn't return to post-pandemic numbers.

00:05:19.600 Yeah, we never seemed to adjust back to that.

00:05:21.820 We never did, right?

00:05:23.140 And so, you know what?

00:05:25.580 The question I was asking, you know, when we were going around asking people in the building and outside the building and friends, you know, how much did the federal government spend?

00:05:34.260 They spent $521 billion, so that's the expenditure.

00:05:39.460 So half a trillion dollars we spend on an annual basis.

00:05:44.180 And I broke that down in the two shows, you know, and quite frankly, the biggest expenditure in that amount is government.

00:05:50.740 So government's biggest client is government now, and that's where most of the money goes from a federal perspective.

00:05:57.120 We only made $459 billion.

00:06:01.800 So the deficit on that was a 60, so.

00:06:05.200 61.

00:06:05.980 $61 billion.

00:06:06.920 $61 billion.

00:06:07.580 Right.

00:06:08.200 Which, you know, I know you're saying, okay, this seems like a lot.

00:06:12.160 But, you know, it is a lot because we increased our deficit from 2019 to 2024 by 47 billion, almost $48 billion.

00:06:22.980 We went up 343%.

00:06:26.460 So that, in that time, the deficit grew to over $600 billion?

00:06:32.660 Yes.

00:06:33.660 In that short time span?

00:06:35.340 The net debt, the net debt grew $609 billion.

00:06:40.120 So from the beginning of the, let's call it the Trudeau era, we actually grew from 2015-16 to 2024 by $609 billion, which doubled our debt for the country.

00:06:58.720 We're now at $1.2 trillion.

00:07:01.680 Incredible.

00:07:02.100 And we're projecting, which we'll talk about more as we go through, we're now projecting on keeping that pace.

00:07:08.960 So, you know, the statements by the existing government, you know, the prime minister, were that in the next four years, he anticipated having deficits about $250 billion.

00:07:20.700 There's 343 electrical, electrical, electoral seats, and politicians, in essence, they're our board of directors here in Canada, are they not?

00:07:35.000 Mm-hm.

00:07:35.740 In a minority government, we should be having a look from that board.

00:07:41.020 They should have an eye on all of this.

00:07:44.260 This is not a weird thing to talk about, given that it's their job.

00:07:52.180 What else would they be primarily focused on right now if it wasn't that we owe so much money, we have such a debt, we're overspending?

00:08:00.740 Why aren't our politicians screaming about this?

00:08:04.940 Well, you know, it's a number of reasons, I believe.

00:08:07.920 Truthfully, a lot of it's out of sight, out of mind, right?

00:08:10.400 Yeah.

00:08:10.900 So if you look at, you know, the major expenditures that the federal government makes, it's transfers, the biggest couple, couple of the biggest categories, one being major transfers to people, right?

00:08:23.880 So these are the ones we kind of say, okay, seniors, kids, EI, you know, and these just keep going up.

00:08:31.580 So quite frankly, they just keep going and going and going.

00:08:34.000 You know, like, I was shocked, to tell you the truth, when I look at 2019 to 2024, that our seniors, our elder benefits went up by 42% and went up by 22 billion.

00:08:47.260 When, in fact, the number of people in that category that had gone into the age, the number of people that turned 65, was only 5% more.

00:08:56.200 Oh, so that was going to be my question, are we aging our population at that 5% significant, but it felt like, wow, we really hit an age bump suddenly.

00:09:06.200 No, we didn't.

00:09:07.160 So part of it was age, part of it was, you know, those baby boomers entering the category, but we gave ourselves a raise, a significant indexing that went across those five years that contributed to that increase, right?

00:09:20.460 So, you know what, I get it, it's a big population, and quite frankly, it's going to, at some point in the next few years, make up 25% of our population, and it's a big voting block, I get it.

00:09:31.660 Oh, for sure.

00:09:32.240 Yeah, so I understand why it was done, but again, you know, these are all the things that came through.

00:09:37.760 Then there's the other one that was, just blew my mind, right, which was contributions or transfers to other levels of government, which is pretty much healthcare.

00:09:47.140 When you look, when I tore it apart, it was $100 billion, right, so transfers to people makes up about $120 billion, transfers to other levels of government makes up $100 billion, right?

00:10:00.920 So now you got $220 billion out of $521 billion, right?

00:10:06.700 And those are primarily healthcare, so when you look, when you rip apart that category, you see pretty much all just healthcare expenditures.

00:10:16.400 And that's another show, I know, but, you know, that has all kinds of challenges that we continually see and we continually are going through in Canada.

00:10:24.680 So, then we get to, which is my favorite one, which is direct program expenses, right?

00:10:33.660 So, and there's $140 billion in that, which is government.

00:10:38.040 It's just crown corporations, government.

00:10:40.180 That's us assigning money to contracts.

00:10:43.400 Yeah, and we grew that $42 billion since 2019 through COVID, never went back to any normalized amount.

00:10:52.800 And then there's all these, what I call slush fund programs, which is a myriad of distributions to other crown agencies.

00:11:00.860 You know, there's some First Nations payments.

00:11:03.140 There's all kinds of things in there.

00:11:04.520 There's, quite frankly, probably our program that I talked about today for the entrepreneurial program for women is in there.

00:11:14.260 So, those are all the things that are in there.

00:11:15.720 Our slush funds, our green slush funds, all those things are in there.

00:11:19.440 So, quite, you know.

00:11:20.500 Paul, don't these budgets have to be voted on in some way?

00:11:23.620 I mean, don't we have any oversight at the, you know, I guess, we're looking to our politicians locally to have a voice on this stuff.

00:11:33.780 How come we don't?

00:11:35.220 No.

00:11:35.660 Well, you know what, the way our parliament works, quite frankly, is, you know, you get majority and then the budget passes, right?

00:11:42.300 So, you know, it goes.

00:11:43.340 But, you know, over the last few years and coming, you know, through the Trudeau period, coalitions started forming, right?

00:11:51.800 So, the NDP and the liberals would form something.

00:11:54.440 They would pass a budget.

00:11:55.900 You know, it became a little bit of a free-for-all, quite frankly.

00:11:58.720 You know, what happened was people would say, okay, I'll vote for your budget if I get, you know, the $38 billion or $10 billion dental care for, you know, low-income individuals in society.

00:12:11.740 So, you know, they formed agreements and they kind of circumvented the whole system, right?

00:12:17.780 So, there's no efficiency in that.

00:12:19.360 There's only compromise with the same amount or more dollars.

00:12:23.000 You're brokering your own deals.

00:12:25.040 So, it's a deal brokering mechanism.

00:12:26.740 And I get politics.

00:12:27.820 I'm not naive.

00:12:28.520 I've been around it my whole life.

00:12:29.800 But, you know what, when you start brokering your future away, then you have to ask yourself, what am I doing, right?

00:12:36.460 You know, am I trying to figure out individual programs over other individual programs?

00:12:42.200 And, you know, that's kind of the death knell for democracy, right?

00:12:45.220 When you can increase your program benefits because your spending is increasing on a certain category, that is the elimination of the democratic process.

00:12:55.800 And that's the scary part in this when you go through it because not only are we growing to such a large deficit amount or a debt amount, you know, we're also creating factions within government that can keep doing it.

00:13:07.240 And there is no way to stop it unless there is a failure, which we're going to talk about in a minute.

00:13:12.600 It's very interesting that the process just feeds itself.

00:13:17.380 Yeah.

00:13:17.480 You know, it's a self-fulfilling prophecy of continuing debt.

00:13:20.820 Yeah, but we weren't always, you know, Mike, and this is kind of when I dug into it, it was really interesting because, you know, I took a look at some of the prime ministers in the past, right?

00:13:29.880 And, you know, and I know I've kind of harped on the Trudeau area, but, you know, John Chrétien, if you remember back, you know, 1994, you know, John Chrétien, wonderful prime minister, ran a very low debt campaign.

00:13:47.020 And then handed it off to Paul Martin, who actually did the same, right?

00:13:51.300 And then we were lucky enough, you know, to have Stephen Harper and up until the mortgage meltdown in 2008 when the economy got all rocky and bumpy from those, remember those subprime debt?

00:14:02.940 Subprime mortgages.

00:14:03.480 Yeah, those fake mortgages.

00:14:04.820 Medi mortgages, yeah.

00:14:05.860 Yeah, so when the world went upside down, you know, he, it's interesting, he was basically done when he increased his deficit, right?

00:14:17.380 So he hit a bumpy period, and, you know, in the words of Arnold Schwarzenegger, I think, in California, you know, no politician should be able to outlast large deficits.

00:14:28.280 And, you know, he, and even in his book talked about it, that he knew he was done in California when 2008 came, because he took, you know, they blamed him, and he went down for it.

00:14:41.260 So, you know, you saw the same thing in the Harper area, and then we get in now, and, you know, we get going in the Trudeau era, and all of a sudden, you know, we got debts rising, it becomes normal.

00:14:54.300 And the crazy thing is, it becomes normal to talk about the billions, right?

00:14:58.720 Well, that's what I was going to say.

00:14:59.520 You just explained to me, we had two different governments, two different parties follow the same trajectory for a period of time, and then suddenly the real estate market and the banks caused a problem that we have never returned from.

00:15:16.220 No, no, we never.

00:15:17.480 So, we get through 2008, we get the Trudeau group, you know, the government to come in, and off we go again.

00:15:26.140 So, you know, we're 33, 24, so the debt amounts on an annual basis don't go below $10 billion.

00:15:32.640 So, we all of a sudden go from a period where we're talking kind of in the low billions to the low millions or high millions to a period where anything over $10 billion is unachievable from a deficit perspective, and it normalizes.

00:15:49.640 We, for some reason, we all say, okay, that's fine, and that's pre-COVID.

00:15:53.880 So, that's pre-COVID that somehow we got okay with running these massive deficit amounts because, quite frankly, we never ran, and it was, I went back and checked, and this was an interesting research exercise for me.

00:16:09.500 Had we ever run any balanced budget legislation?

00:16:13.220 So, had anyone ever come and said, you know, like debt ceilings in the U.S.?

00:16:16.820 We need to have a parameter in place.

00:16:20.200 It's never been suggested.

00:16:21.520 On the, some provinces, right, you know, Ralph Klein, remember the Ralph Klein days when he kind of, he came and did it?

00:16:30.600 There are some provinces have looked at it, done it.

00:16:34.500 Municipalities, for the most part, are just a hot mess, quite frankly, that the federal government and the provincial governments help out.

00:16:40.940 And the provinces just keep downloading more and more to the municipal level.

00:16:45.200 The hotter the mess they are, the more money they give them.

00:16:47.760 I don't know why.

00:16:48.380 But, anyways, that, that just become the norm.

00:16:51.880 And so, you know, balanced budget legislation just never seemed to be part of our lexicon, and we never wanted it to be.

00:16:59.080 Which, again, as you go through this, it kind of taints our history because we keep cratering into this massive, massive hole.

00:17:08.120 You know, and I think as we go along, we've got to look at the federal government, we've got to say, okay, like, where are we getting this money?

00:17:20.200 Do you know, do you know where we get this money for the deficits, Mike?

00:17:23.040 Well, apparently, we just invent it.

00:17:27.320 Because when you just told me what our overall deficit is as a country, that number was shocking to me.

00:17:36.180 And that we keep adding to it at this rate.

00:17:38.680 So, then, just to be clear, the number that we talked about does not even include the provinces and the municipalities.

00:17:48.960 No, just the federal.

00:17:50.380 We're just, we're just talking federal dollars.

00:17:52.180 You know, that's a show we're going to do.

00:17:54.240 We're going to do some shows coming up where we're going to, you know, take a look at the West Coast, the East Coast, Central Canada, and we're going to break down kind of what their budgets look like.

00:18:03.360 But, yeah, this is just the federal government.

00:18:06.340 That's wild.

00:18:07.200 Yeah.

00:18:07.380 Okay.

00:18:07.740 So, where does deficit spending come from?

00:18:10.820 So, you know, it's pretty basic, really.

00:18:14.560 We borrow it or we print it.

00:18:17.440 So, two things, right?

00:18:20.480 And, you know, as we go through it, you know, you've got to think through, you know, you mentioned about the provinces versus the feds.

00:18:27.440 So, I want to back up for a minute.

00:18:28.640 You know, our founding fathers really created the federal government, you know, not to be the catch-all, to be the largest entity in government.

00:18:39.180 The federal government was to control programs that every province would use, right, health care, unemployment.

00:18:46.560 So, there was pensions, right?

00:18:48.380 So, there were things that they felt that the federal government should handle for economies of scale.

00:18:53.580 It was an efficiency tool.

00:18:54.940 So, the sad part about it is it started off as a good idea, right?

00:18:58.880 And the downloading or the provinces were given a lot of powers and rights so they could run their own economies, right?

00:19:07.660 They could basically, and they do for the most part.

00:19:10.660 Oh, they did for the most part up until post-COVID where that kind of became very messy.

00:19:16.500 Again, we're going to talk about it in other shows, but, you know, that was the intent of our founding fathers and, you know, we just went in the wrong direction.

00:19:25.440 We became a bloated entity on the federal side.

00:19:30.060 We got okay with deficits and here we are.

00:19:33.620 And the provinces, the provincial deficits seem to be ever-growing.

00:19:39.020 The federal government's forever bailing out programs on that front as well.

00:19:46.140 Yeah, hot mess is a really good description.

00:19:48.260 The federal government's grown out of control in the sense that your democracy erodes when they borrow more, they take more of your income, and they grow to be a department of the government, essentially.

00:20:00.760 Yeah, they became a business.

00:20:02.640 A business.

00:20:02.980 It became the biggest business in their business is what happened.

00:20:06.600 They built their own raises, the benefits, and all their expenses, and we pay for all of it.

00:20:14.100 Yeah.

00:20:14.460 Well, you figure if your GDP is $3 trillion, right, so your GDP is just under $3 trillion, your expenses are $500 billion for the government, right?

00:20:23.100 You're the most powerful.

00:20:24.380 You are the biggest spender entity in the country, right?

00:20:28.460 So at that point, you have the most employees, you have the most infrastructure, which was really not the intent, right?

00:20:36.020 It was, again, the intent of it was to create economies of scale by running programs across multiple provinces.

00:20:44.740 In your research, have you caught any sense of kind of what population or what area of our population receives versus who the biggest contributors are to the coffers here in Canada?

00:21:03.140 Yeah.

00:21:03.560 No, it's a great question.

00:21:04.780 You know what?

00:21:05.640 I get that it's asked all the time, and it's really hard to figure out the numbers.

00:21:08.940 But, you know, by looking at seniors, which we talked about, which make up 25%, and we actually spend $76 billion on elder benefits a year.

00:21:20.840 And then you take the government expenditures, as we talked about, which makes really, you know, you add health care in there.

00:21:27.600 You're talking another $335, so health care and then the benefits and then the slush programs.

00:21:33.160 You know, you're definitely over 50% of the people take more from the system than they give to the system for the total population of Canada.

00:21:43.420 It's what the exact number is, I have no idea.

00:21:46.580 We'd have to do more research on.

00:21:47.940 How is this sustainable?

00:21:50.680 Well, it isn't sustainable, right?

00:21:54.380 Because, as we talked about before, in, you know, 2024 compared to 2019, the annual deficit floated 343% up, right?

00:22:05.940 So it went up $61 billion.

00:22:08.920 You know, our deficit's $1.2 trillion from $685 billion.

00:22:17.600 You know, a good example, right, and I only have, you know, a soundbite from the news, you know, is that it's a wake-up call, right?

00:22:30.560 It's a wake-up call for all of us, you know, that our interest payments are now $47 billion a year.

00:22:38.440 That's incredible.

00:22:39.120 We pay $47 billion, and that's basically up from $23 billion in 2019.

00:22:46.700 So we doubled our interest payments in those years, and that's got to be a wake-up call, you know, because if you're a regular business, well, think about yourself, right?

00:22:57.060 You know, you're going along, you're running your business, taking your loan, you know, you start taking more loans, you start taking more loans.

00:23:03.240 Right.

00:23:03.660 You're still getting income in, so you're still, you know, you're generating, you're charging your customers.

00:23:09.120 Customers more.

00:23:10.200 Yeah.

00:23:10.460 You're finding new ways to grow, but you're not growing fast enough because your interest is growing, and in this case, it would be unsustainable.

00:23:17.280 If you were running a business, you wouldn't make it, and now, quite frankly, with the announcement to keep at that pace, so if we're comfortable keeping at the $60 billion a year pace, you know, it definitely isn't sustainable,

00:23:30.320 and in the next four years, you know, we're going to see even more if we decide to do military spending.

00:23:39.200 Yeah, we've committed 5% of GDP to that.

00:23:41.860 Yeah, exactly, right?

00:23:42.880 If we jack up our military spending, where are we going to end up, right?

00:23:45.860 We're going to end up $3 trillion?

00:23:49.320 So if you do the math, right, so do the math for me for a minute, we're at $1.2 billion.

00:23:53.340 Yep.

00:23:53.980 10 years, we're roughly going to be running about $60 to $80 billion a year.

00:23:59.400 Per year.

00:23:59.840 So you're at $2 billion.

00:24:01.360 Now you take 5% of GDP.

00:24:03.840 So if GDP is $3 trillion right now, right, $3 trillion, 5%, that's $1.5 trillion, right?

00:24:12.480 Or $150 million a year times 10, right?

00:24:16.660 Yeah.

00:24:16.920 So that's $1.5 trillion.

00:24:18.700 So $1.5 trillion on $2 billion.

00:24:21.100 You're at $3.5 trillion, right?

00:24:24.800 And the interest, so you've got to remember, $50 billion in interest for every trillion, right?

00:24:33.940 Is roughly.

00:24:34.680 And that's if we stay at these low interest rates.

00:24:37.760 Because right now, we're running a pretty low interest rate amount, right?

00:24:41.700 So our interest rates are fairly low.

00:24:43.940 So if we go up to the 50-year average, we'd go up to 5% or 6% or even 7% on interest rates.

00:24:51.260 That means our interest rate would grow from $50 to $80 billion a year in interest payments every $1 trillion.

00:24:59.240 So we could get to the point, quite frankly, if we get to $3 trillion with the defense spending, we'd get to $250 billion in interest every year.

00:25:11.080 So which would definitely be unsustainable.

00:25:14.620 It's not even.

00:25:15.640 So what happens?

00:25:17.800 This out-of-control spending, where does that lead us in your mind over the 10-year period that you're talking about there?

00:25:27.120 Well, you know, we got out of control.

00:25:30.240 So, you know, we talked about it earlier.

00:25:32.060 Just going to step back for a minute.

00:25:33.580 We came out of COVID, right?

00:25:34.960 We spent $327 billion during COVID.

00:25:38.580 So, you know, and you can argue, you know, we've talked about it on previous shows.

00:25:44.380 Should we go back and should we take a look at that?

00:25:46.760 We should.

00:25:47.240 Oh, absolutely.

00:25:47.960 We should.

00:25:48.560 Because, quite frankly, there was a lot of things happened.

00:25:51.360 You know, even today, the story we started the show about, you know, that's an offspring of COVID thinking, right?

00:25:58.580 You know, we gave an entrepreneurship fund to a group of people that didn't use it in the method we wanted it used and followed the process.

00:26:09.320 And there was many other ones along the way, you know, the Arrive Scam.

00:26:13.020 The Green Fund.

00:26:14.160 So, you know, those are all things we should look at that happened during that period.

00:26:18.220 And we're part of the $327 billion.

00:26:20.760 And I think that's a good exercise to go through.

00:26:23.500 Are we going to get any of it back?

00:26:25.580 No, I'm going to assume not, Paul.

00:26:26.900 No, we're not going to get any of it back.

00:26:28.180 But to have an eye on what went wrong, and at least as Canadians, maybe it'll refocus us on keeping accountability.

00:26:39.000 I think so.

00:26:39.560 Well, and I honestly, Scott, all kidding aside, I think there's a whole show on probably the crime and the other part of this that we need to look at, quite frankly.

00:26:50.060 And we need to figure out what we do with all these things when they happen, right?

00:26:54.360 Because we can't, what we're finding as we come through the economics of this, we can't just turn a blind eye to it anymore.

00:27:00.400 We can't just say it's okay because it's not okay, right?

00:27:04.940 It's not okay that the money's going.

00:27:06.880 It's not okay that we're spending it inappropriately because it's going to cause the outcome of what's going to happen next.

00:27:14.260 Which, I guess, puts us financially, globally, not in an ideal position.

00:27:21.740 No, no, not at all.

00:27:23.420 Cripes.

00:27:24.080 We're propping, so right now we're propping up the, oh, you know what, let me back up for a minute.

00:27:29.280 You know, let's take an example of a country that did a similar thing to what we're doing.

00:27:34.020 So, you know, our dollar, right, based on the amount of debt we're taking, will devalue and inflation will stay.

00:27:43.420 But ultimately, the cost of borrowing will go up, right?

00:27:47.660 So it's a vicious circle, as we talked about.

00:27:49.660 You know, as our debt goes up, so does our interest.

00:27:53.360 Therefore, it erodes our dollar value.

00:27:56.260 It increases our interest.

00:27:57.700 And then, right, our credit worthiness.

00:27:59.920 So the challenge is, what happens is, is we borrow more to try to offset all these vicious deficits that we're actually putting up on the board and the debt increasing.

00:28:11.320 We actually spiral into a similar situation as Greece.

00:28:16.140 Remember Greece?

00:28:16.800 Oh, man.

00:28:17.440 Yeah.

00:28:18.080 The devaluation.

00:28:19.420 So what happens is, eventually, the bond market says, you know what, you're not credit worthy anymore.

00:28:24.000 So I don't want you, I don't want to borrow, I don't want to lend you money anymore.

00:28:28.740 So I don't want to lend you money.

00:28:31.360 And all of a sudden, the only avenue you have is...

00:28:36.100 Printing money.

00:28:37.560 Printing money, right?

00:28:38.600 But then that devalues your dollar.

00:28:40.220 Suddenly you're going to buy a loaf of bread with a garbage bag full of dollars.

00:28:43.580 Yeah, yeah, of course.

00:28:44.900 And then all of a sudden, right?

00:28:47.140 So now your costs are going, your inflation's going up.

00:28:51.680 You have, all your creditors, right?

00:28:54.200 China, you know, the Middle East, everywhere, is coming and saying, hey, I want repaid.

00:28:59.660 Like, I want some money back, right?

00:29:00.880 Yeah.

00:29:00.980 You're looking not so stable anymore.

00:29:03.480 So, and then your government programs are shut down.

00:29:06.060 Remember, they shut all their...

00:29:07.560 100%, yeah.

00:29:08.500 ...their pensions, all those.

00:29:09.540 Remember the, I don't know if you remember, but they took their pension plans, they shut them down,

00:29:13.480 and they used to be, I think they started their pension programs at, like, 50.

00:29:18.500 And so if you were 50 years old, you started on a government pension.

00:29:21.720 They then had to jack them up to, like, 70 or...

00:29:24.300 I think they were 70 years old now, which was devastating to families that had planned their whole lives to be done at 50

00:29:29.680 and, you know, incorporating that into their...

00:29:32.020 Yeah, so those are all the things, you know?

00:29:34.120 And you have to keep in mind, like, we're not a robust GDP.

00:29:38.460 So this is where, and, you know, no one talks about it,

00:29:40.780 but if we were kicking it on the GDP side, so if Canada was, like, doing, like, as well as the U.S.,

00:29:47.840 so the U.S. per capita GDP is about 77,000, the Canadian GDP is only about 54,000, right?

00:29:55.040 So we've been kind of lagging behind for years.

00:29:58.320 I've written articles about that in our newspaper, and, you know, we're 33% lower than the U.S. on our GDP per cap,

00:30:05.820 and based on the size of our nation and who we are and our resource-rich economy,

00:30:11.920 that's unbelievable that we would be there right now.

00:30:14.880 So how we actually, coming through COVID, saw such a reduction in our GDP is unfathomable for what we have resource-wise.

00:30:24.040 So this decrepitation of our nation financially, like, how long do we have before we start seeing the effects of this?

00:30:34.620 Well, that's a hard question, you know, and I don't know how we've made it this far, quite frankly, when you look at the numbers.

00:30:41.580 When you go and you peel through the numbers, you think to yourself, God, how's this still standing, right?

00:30:45.780 Because it doesn't look so good, and we're propping up.

00:30:47.800 We continue, we do a really good job as a nation to prop up our dollar.

00:30:51.800 You know, we hustle out there, we pull debt, you know.

00:30:56.560 We try to keep our inflation down.

00:30:59.640 But like I mentioned, our productivity is really low.

00:31:02.640 Our public projects are almost nonexistent right now.

00:31:05.460 We're gridlocked, whether it be pipelines, whether it be anything to do with, you know, minerals, whatever.

00:31:11.900 It's true, the government's stopping these projects that could be providing jobs, providing infrastructure that is cost-saving.

00:31:21.860 You know, so what do we do when the government actually – what happens if we actually invest in public projects

00:31:30.900 and we start to have wealth in this country again?

00:31:35.820 We're not deploying it, and they decide to leave.

00:31:38.260 You know, if people take their money out of this country, the wealth of their seniors, and they're all leaving with it, 0.52

00:31:49.020 all these huge pension liabilities throughout the country that ultimately are, you know, moving off the books,

00:31:54.600 do we find ourselves making our way back?

00:31:58.460 Well, that's the challenge, right?

00:31:59.780 So we have a, you know, and it's a disgusting, you know, the U.S. talks about it quite a bit.

00:32:04.780 We're not talking about it right now.

00:32:05.880 We have a disgusting amount of wealth sitting with our baby boomer seniors right now, like disgusting. 1.00

00:32:11.560 So the wealth transfer didn't happen, you know.

00:32:15.700 It might happen, but that's a bequest, you know, or people waiting for their loved ones to pass away and get inheritance.

00:32:23.720 That's a long process, right?

00:32:25.460 So a lot of what we have in Canada now is old money.

00:32:28.440 Old money's getting smarter. 0.78

00:32:29.840 They're moving it offshore, right?

00:32:31.480 It's a high-tax region, so you're seeing more and more, you know, people who are still healthy enough to move are moving.

00:32:38.500 If they move with their assets, we don't send a very good financial indicator by even our CPP investing only 12% of the pension in the country and 47% in the U.S.

00:32:52.420 That's a rough number to hear.

00:32:54.000 It is a rough number to hear, and you lose confidence, right?

00:32:56.280 That gets you down a little bit when you hear, you know, and that's something that hasn't always been, right?

00:33:00.240 You know, less than a decade ago, we spent, we invested 85% of our CPP in our own nation.

00:33:07.660 So in the Harper days, most of the oil and gas investment was actually our own CPP investment.

00:33:13.780 So somewhere along the way, we made the decision that it was a bad bet to do that.

00:33:17.860 I think that's a bad decision.

00:33:19.420 And I think we sent an indicator to a bunch of people who controlled the wealth in the country that, you know, they had to look other places and find safe havens.

00:33:27.700 We can't make anything of it here.

00:33:30.080 You know, our government can't make anything of it here.

00:33:32.320 We should really be elsewhere with our money.

00:33:34.320 Right.

00:33:34.740 So, you know, it's interesting.

00:33:36.180 So we created, you know, again, we have these, and, you know, we're going to talk about it on other shows also.

00:33:41.920 But, you know, we create these immigration schemes to bring people in, which I commend.

00:33:47.100 You know, we're all immigrants at one point in time.

00:33:49.400 But, you know, they're not going to replace the wealth that we're losing, quite frankly.

00:33:54.500 That's not going to happen.

00:33:56.420 Unemployment right now is at a high, about 7%.

00:34:00.180 And we have, you know, what we've done is we've parked a bunch of our younger citizens.

00:34:06.180 At home, you know, our 20-year-olds are sitting at home feeling devalued.

00:34:10.480 You know, we have a significant drug issue on the health side.

00:34:13.640 But, and quite frankly, that's not making us productive.

00:34:18.800 And that's the key to the economics of this.

00:34:20.820 Like, we need to increase our productivity.

00:34:23.700 We need the investment in Canada to start.

00:34:26.640 And, you know, there's a few ways to do it.

00:34:28.940 Yeah, tell me, okay, so you and I talked earlier and you said, you know, there are some solutions probably that we're not looking at right now.

00:34:37.160 What are those?

00:34:37.760 Sure.

00:34:38.340 No, I think the government, listen, I commend them.

00:34:40.580 You know, they're doing a few things that I think they're doing really well right now, and they're trying to do them.

00:34:46.180 So they've woken up and they realize, you know, the people that are coming to the country aren't like the people in their 50s. 0.80

00:34:53.420 They're not highly skilled.

00:34:54.500 Like, in the 50s, we brought in immigrants who, like my, you know, parents and others and uncles and aunts.

00:35:03.560 They brought in people who had skills, came from the old country, had skills, bricklayers, plumbers, you know, plasters.

00:35:10.600 They knew what to do.

00:35:11.540 So they're trying to get the people they're bringing to get up to speed and become skilled.

00:35:16.640 I think that's really good.

00:35:18.380 In order to increase your productivity, anyone you're bringing in the country now, you've got to be training really, really hard.

00:35:24.840 Like, you've got to get them into a program.

00:35:26.600 You've got to get them because, quite frankly, you can't increase your productivity in any manner without doing that.

00:35:33.140 That makes sense.

00:35:33.780 Whether from computers to just basic trades.

00:35:36.480 So I think that one they've realized, and I think they're hitting it.

00:35:40.480 Print money.

00:35:41.340 That's the only thing.

00:35:44.260 With the fact that we've doubled our interest and our productivity is low, and quite frankly, we're not seeing a lot of growth on the other front from our revenue perspective, we need, as a country, to print some money.

00:36:00.740 But the money we print has to go into productive projects.

00:36:04.260 So here's the key.

00:36:05.160 So put it back into our own national projects.

00:36:08.580 Right.

00:36:09.060 But we can't steal them.

00:36:10.600 Like, so, and I joke, you know, before, we can't do projects that are going to just go off to nowhere.

00:36:16.960 Right.

00:36:17.360 So, you know, it's not about pushing money somewhere and finding out that the money didn't go into the project.

00:36:22.960 And, you know, we did a project, but when we did a value assessment of the project, a money-added-value project audit, it had no value.

00:36:33.440 The money went nowhere, and we didn't produce anything.

00:36:35.640 We cannot do that anymore.

00:36:37.020 So, when we talk about the opening of the show about, you know, projects that went nowhere, we really need to do value-added projects.

00:36:45.640 And they have to have...

00:36:46.520 Well, I think programs, projects and programs are two different things.

00:36:50.780 Yes.

00:36:50.960 And what we really need is some massive national projects, you're saying.

00:36:54.880 We do.

00:36:55.200 With which to spend this printed money on.

00:36:57.660 Yeah.

00:36:58.160 Well, can I...

00:36:59.720 I mean, just two things.

00:37:01.420 We need different levels of projects.

00:37:03.700 So, we don't need just large projects.

00:37:07.320 We need small entrepreneurs because there are people in the economy right now who are getting up there in age, right?

00:37:16.040 Our pension programs have made them unemployable because people don't want to pick them up.

00:37:20.620 Some of our laws are antiquated and make it difficult for people over a certain age to get picked up in the employment market.

00:37:27.120 Right.

00:37:27.320 So, we need them working, right?

00:37:29.840 So, small entrepreneurs tend to actually bring them in for their experience.

00:37:33.380 They have really good value for them.

00:37:34.880 Good point.

00:37:35.400 Right?

00:37:35.700 Whereas large corporations don't, right?

00:37:37.560 So, we need our public funds, so the money we print, to go at different levels, right?

00:37:44.280 Some of it has to go to the small entrepreneurs, but it has to go and it has to be working.

00:37:49.040 So, we have to be very diligent in making sure we just don't throw a bunch of money out there and the money gets spent on, you know, someone's slush fund for their retirement in Antigua.

00:38:00.420 Right.

00:38:00.720 Right?

00:38:01.080 It has to actually come back to Canada, be used in Canada, employ people, buy materials that are built in Canada, and function, right?

00:38:08.500 Maybe a certain amount of accountability needs to be applied to that newly printed money.

00:38:13.420 Yes.

00:38:13.940 Well, we have enough people.

00:38:15.060 So, quite frankly, we've created an infrastructure in government.

00:38:17.960 We have enough people to watch it, right?

00:38:20.940 It is our biggest.

00:38:21.580 True.

00:38:21.980 Yeah, we do.

00:38:22.420 So, some of those people, quite frankly, can get those programs going and make them successful.

00:38:27.880 They're good people.

00:38:29.200 They want to work, right?

00:38:30.320 They're just doing a job that they were paid to do and directed to do.

00:38:34.820 Okay, what else do we do?

00:38:36.100 Return to pre-pandemic spending.

00:38:38.940 You know, that's the big one.

00:38:40.040 I harp on that all the time.

00:38:41.740 We just got to go back and we got to say, okay, what were we spending?

00:38:44.840 We weren't doing terrific before.

00:38:47.720 We had a $14 billion deficit, you know, the year COVID started.

00:38:52.780 We need to go back there, right?

00:38:54.620 We need to get back to that and we need to start doing all these crazy things.

00:38:59.960 But, and quite frankly, we need to focus on domestic policy, right?

00:39:05.620 Like, I know we want to travel.

00:39:08.280 I get it.

00:39:08.860 I say this on, how many shows have I said this on?

00:39:10.960 You're probably sick of this, but I go back.

00:39:12.820 Right now, in the world, thinking that anyone else in Germany, Poland, Italy, you know, China, Taiwan, is going to dig us out of this hole, that's very naive.

00:39:28.120 You know, the U.S. is taking care of themselves.

00:39:30.700 When you listen to the debt crisis in the U.S. right now, the debt crisis in China, anywhere else, they have very similar circumstance to us.

00:39:41.240 So, we're not alone in this.

00:39:43.140 We might say, oh, because we're smaller, it's a smaller number.

00:39:46.240 But per capita, we're all kind of in the same, you know, not so great situation.

00:39:51.540 So, you know, the key is we got to focus on our domestic growth.

00:39:55.480 Okay, so it begs the question, why aren't the legislators screaming and yelling to fix this all day long?

00:40:05.360 It seems to be the core, over $1 trillion, easily headed to three and beyond over the next decade without even trying, and yet legislation, the legislature is doing nothing about it.

00:40:20.660 Yeah.

00:40:20.880 I mean, they complain about it in bits and pieces, but as a framework of how we spend and how our deficit is mounting, why aren't we hearing?

00:40:30.760 Well, you know, honestly, Mike, politicians do not lose for spending too much in elections, right?

00:40:35.780 That's true.

00:40:36.240 But your kids do.

00:40:37.520 Yeah.

00:40:37.920 Right?

00:40:38.300 So, you know, this is where you got to get a little bit excited, and I think people got to get really excited for their own well-being because, quite frankly, it's the future of their kids.

00:40:48.300 Now, it's not just the future of their kids, right?

00:40:51.380 So, and I keep saying this to, you know, siblings of mine right now, right?

00:40:58.520 I'm having this conversation with them, and, you know, they have great government pensions.

00:41:02.220 They're in retirement, you know, and we were having it the other day.

00:41:06.580 I said, well, you know, and their comment to me is, well, this isn't going to impact me, right?

00:41:11.520 So, it's not going to have any impact on me, and I said, well, it might.

00:41:16.780 Yeah.

00:41:17.640 It may.

00:41:18.640 I mean, this is what I think.

00:41:21.040 You raise a good point.

00:41:22.000 I think that as citizens of Canada, we think very much today, a little bit from yesterday, and not at all about tomorrow when it comes to these things because we spend so much time trying to be popular with our vote among our friends and family instead of really focusing on what it is financially that's going wrong with this country.

00:41:43.980 Yeah.

00:41:44.140 Well, you know, we just talked about, you know, we mentioned Greece, and I'm not trying to pick on Greece because I love Greece, beautiful country, and I love the people, but you know what?

00:41:53.120 We talked about pensions, right, earlier on, and so, you know, out of all this, you know, as we rack up more debt and debt climbs, interest climbs, we have an instability in society.

00:42:07.660 So, it creates an instability, and people go, well, what's that instability, Paul?

00:42:10.720 How does it impact me?

00:42:11.780 Well, ultimately, pensions benefits would be not paid.

00:42:16.620 So, if it got really bad and they said, okay, I can't, the bond market came back and said, listen, we're not going to, you're not credit worthy, we're not going to take your bonds anymore, then we'd be, start to print money.

00:42:28.760 But people forget, like, the bondholders aren't just going to say, hey, okay, that's fine, right?

00:42:34.540 We're good.

00:42:35.160 We're good.

00:42:35.420 I'm not going to take any future, you know, bond, you know, I'm not going to lend you any more money.

00:42:41.780 They're going to say, hey, you've got a liability here, pal, and you've got to at least pay the interest on it.

00:42:47.320 So, you better start shutting down those programs, whether it be pensions, EI, you know, child support, all those, all those great.

00:42:56.960 Major key players in our society.

00:42:59.220 All those ones that say transfers to people, right?

00:43:02.420 Those ones are going to be shut down.

00:43:04.100 You know, government, all that.

00:43:05.840 Back to the budget.

00:43:06.480 Back to the budget, yeah.

00:43:06.940 Back to the budget.

00:43:07.900 So, we'll be forced.

00:43:08.940 Like, that would be a forced event, which won't be fun.

00:43:13.180 It'll be painful as hell.

00:43:15.640 And you'd have to restructure all your debt.

00:43:17.680 And what, usually in countries, like in Greece and everyone else, other countries come in, they help them out.

00:43:22.160 Now, you've got to remember, that was in a time where everyone else was in a pretty good place.

00:43:26.700 So, I tell people that also.

00:43:28.160 Like, when that happened, the rest of the world was pretty stable.

00:43:31.420 Well, fine, yeah.

00:43:31.960 Right?

00:43:32.200 They weren't.

00:43:33.240 So, a lot of people could come in and help them and restructure their debt and keep the ball in the air, you know, bump the ball up.

00:43:39.940 But, you know, that's not the case in this economy, right?

00:43:44.160 In this ecosystem.

00:43:44.740 To go to a friendly nation for support is likely not going to happen.

00:43:48.660 Who would be the friendly nation?

00:43:50.920 Yeah.

00:43:51.520 So, now let me ask you this.

00:43:53.680 I would assume that now we are planning and budgeting like crazy.

00:43:59.560 Are we at the federal level?

00:44:01.420 No, no.

00:44:02.580 Of course not.

00:44:03.480 No, no.

00:44:04.200 No, no.

00:44:04.780 We have no budget. 1.00

00:44:05.300 No, silly of you to think. 0.99

00:44:06.500 We have no budget. 0.98

00:44:07.360 You know, around Halloween, I think we're going to get a budget.

00:44:10.280 So, you know.

00:44:11.100 I wonder how scary that will be.

00:44:12.720 We'll certainly be shelling out on that day.

00:44:15.240 Yeah.

00:44:15.760 But, you know, the thing is, what does scare me a little bit, and, you know, being a former accountant, so I look at it.

00:44:21.580 You know, we haven't seen an annual report for 2025.

00:44:25.480 We haven't seen a budget for going forward for 2026.

00:44:28.980 So, yeah, again, I kind of come back to my own, you know, business background.

00:44:33.020 Would you run a business without a strategic plan that didn't take you out more than a year?

00:44:37.380 Would you delay?

00:44:39.240 When you finish your fiscal year end, would you not want to see how you did?

00:44:42.660 And would you not want to use that information from the previous fiscal year to build your plan going forward?

00:44:49.300 Of course you would, right?

00:44:50.340 So, how can you have a budget without last year's results?

00:44:54.200 Yeah.

00:44:54.460 So, obviously, they must have last year's results because they're bragging that there's a budget on the way.

00:44:58.740 Oh, almost right when they get back from a summer break, which, for some reason, I think is in October this year.

00:45:05.140 Yeah.

00:45:05.620 No, it seems like it.

00:45:06.900 But, you know, you would use that information to go through and look at all the contracts, adjust your costs, review your contracts, eliminate what you don't need from a domestic policy, make your cuts, and then try to get back towards something that was reasonable.

00:45:23.440 That would be the rational thing to do, and that's where we're missing that discipline in the system where we get back to doing that, right?

00:45:33.300 We sort of got away.

00:45:34.480 We hit COVID, and we were in panic mode.

00:45:37.520 You know, we've gone to tariffs.

00:45:39.080 We said, okay, you know, we're kind of back in a little bit of panic mode again.

00:45:43.080 Time out, right?

00:45:44.380 We got to get back to, you know, we finished the fiscal year end, March 31st.

00:45:49.360 For those of you who don't know, someone asked me today, when's the year end of the government?

00:45:52.120 March 31st.

00:45:52.920 We finished the year end.

00:45:54.160 Okay.

00:45:54.700 Well, a normal company says within the end of their fiscal year end, within 60 or 90 days, they produce a set of financial statements.

00:46:03.000 Right after that, they produce a budget.

00:46:05.040 You know what I mean?

00:46:05.680 They produce a budget before the year ends over.

00:46:07.980 They present it at an annual general meeting?

00:46:09.800 Yes, exactly.

00:46:10.480 Or in this case, legislature, you know?

00:46:13.000 Yes.

00:46:13.520 Yeah.

00:46:13.940 We got to get back to there because, quite frankly, predicting after the fact, which we did kind of through COVID and we continue to do,

00:46:22.160 isn't good, right?

00:46:23.760 It's not going to work.

00:46:24.660 And that's kind of, I think, a hope and a prayer that we're going to cut a deal with someone else who are going to take us out of this.

00:46:31.080 And I think that's more and more becoming a little bit of a pipe dream.

00:46:35.160 So I'm not sure the world even knows Canada exists so much.

00:46:38.500 We miss a lot of photo ops lately where normally we would have been.

00:46:41.880 Yeah, we do, unfortunately.

00:46:43.560 So, and, you know, hopefully that will get rectified soon.

00:46:46.540 And I look forward to this conversation.

00:46:48.880 I look forward, Mike, to when we get the 2025 annual plan, we sit down.

00:46:55.140 And when we get the budget, we sit down.

00:46:56.500 And I, listen, I'm not, I don't want to bet against the country.

00:47:00.720 I hope that, I love this country.

00:47:02.360 I hope it does well.

00:47:03.560 But, you know, if we don't put the discipline back in the system, where are we going?

00:47:09.400 So, thanks, Mike.

00:47:10.820 Thanks, Paul.

00:47:11.360 And I appreciate it.

00:47:12.400 So, and thank you for joining.

00:47:13.940 And going forward, we're going to keep this up.

00:47:16.740 And we're going to keep talking about the budgets and the annual plans coming up.

00:47:20.340 And so, please, you know, tune in, subscribe, and we look forward to seeing you.

00:47:25.240 Also, go back and check out the previous two episodes on these financial matters of our government.

00:47:32.160 They're very informative.

00:47:33.080 Thanks, Paul.

00:47:33.700 Thanks, Mike.

True Patriot Love - October 16, 2025

Canada’s $61 Billion Deficit： Why No One’s Talking About It!

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