True Patriot Love

00:00:00.800 Walk into any grocery store in Canada and brace yourself.

00:00:03.900 The sticker shock hits before you even reach the checkout.

00:00:07.440 Families are paying more for less and somehow we're being told inflation is cooling.

00:00:12.300 A bag of basics now costs what a full cart used to.

00:00:15.600 And this isn't about luxury items.

00:00:17.540 This is food, survival and dignity.

00:00:20.400 Canadian homes saw an increase of almost 5% on groceries

00:00:23.140 and the big three grocers will see an increase of between 10% and 12% in profits.

00:00:28.500 Profits totaling over almost $4 billion.

00:00:32.200 So on this episode, we ask the questions politicians keep dodging.

00:00:35.720 How did feeding your family become unaffordable in Canada?

00:00:43.980 Well, Franco Teresano is the federal director of the Canadian Taxpayers Federation

00:00:48.640 and this is a guy who holds government accountable for wasteful spending and higher taxes

00:00:54.200 and one of my favorite people to represent Canadians.

00:00:57.820 that you see commentating out there.

00:01:00.200 Franco, thanks so much for joining us today.

00:01:02.380 Hey, it's my pleasure.

00:01:03.160 It should be fun.

00:01:04.280 Yeah, this is unfortunately not a fun topic.

00:01:07.360 Most of us being affected by it, I'd say everybody.

00:01:11.700 I purport to tell you today that I believe that we are in a cost of living crisis at the moment.

00:01:17.740 Something that has never been said by our Prime Minister or anybody at that level of government or around him.

00:01:25.440 But I think you're probably like me and you're feeling it as well.

00:01:29.200 Yeah, well, look, I think if you talk to anyone outside of the elite Ottawa bubble,

00:01:33.420 they'll tell you that life is still unaffordable, right?

00:01:35.620 We've been going through this, what, like for three, four years and it's still,

00:01:40.460 it's still life is so expensive here and we can get into some of the reasons why.

00:01:44.300 But, you know, I think one of the main drivers of this is, is government, right?

00:01:48.520 The cost of living is so high because the cost of government is so high.

00:01:52.880 And like there's, there's three different ways essentially that government in Canada is driving up the cost of living.

00:01:58.700 I mean, number one, just how much money they're taking from people's pockets, right?

00:02:03.080 The fastest, the simplest, the easiest way for government to make life more affordable

00:02:07.200 is just to stop taking so much money in the first place.

00:02:10.600 Then you have inflationary taxes where the feature of the tax, not the bug, is to make life more expensive, right?

00:02:18.380 Think carbon taxes, think alcohol taxes, things of that nature.

00:02:22.880 And then finally, which we saw during the heart of the pandemic is a way that government finances its spending, its borrowing.

00:02:30.780 And that's the inflation tax.

00:02:32.260 And we saw that during the heart of the pandemic where the central bank printed up hundreds of billions of dollars

00:02:37.320 out of thin air, largely to finance Ottawa's massive deficits.

00:02:41.140 And, you know, the more dollars that the central bank prints, the less that your dollars buy.

00:02:46.000 But those are the three ways that government really drives inflation.

00:02:49.480 It's funny, not to put a tack in what we're already talking about, but as you talk about government spending,

00:02:55.920 one of the things that I think we're seeing reflected now is how much overspending was done throughout COVID,

00:03:01.040 how much money Trudeau printed.

00:03:03.260 We're now paying the price for at a time where we really need our economy working for us and our government working for us.

00:03:11.200 We have to tackle those debts somehow.

00:03:13.400 And it seems like this is how we're doing it.

00:03:16.500 We got to cut spending, right?

00:03:18.640 There's no other way around it.

00:03:20.340 Like, look, I think at the point that we are in, you know, this moment that we're living in as Canadians,

00:03:26.760 like the government is not the solution.

00:03:29.580 Too much government has become the problem.

00:03:32.700 Like that's the only way.

00:03:33.880 I mean, let's talk about Prime Minister Mark Carney moving forward,

00:03:36.880 because, you know, we could rehash the Trudeau era.

00:03:39.300 I think, you know, everyone now knows that Trudeau doubled the debt in 10 years, which is crazy.

00:03:45.700 But like, look, you have the Prime Minister Mark Carney now talking about cutting waste, you know, those types of platitudes.

00:03:52.440 But you look at his budget and this year the federal government is spending $38 billion more than last year.

00:03:59.640 Spending is going up by billions of dollars every single year into the future.

00:04:03.120 So, like, I know Mr. Carney, he's a rookie politician, but pro tip,

00:04:08.040 when you increase spending by billions of dollars every single year, you're saving money wrong.

00:04:12.400 No, no, no, Franco, you don't understand.

00:04:14.060 We've changed entirely how we do the budget.

00:04:16.160 You have to look at it from this perspective now.

00:04:18.240 I mean, that was an interesting trick as well in my mind.

00:04:21.820 So now, of course, you're not going to get an argument from me.

00:04:25.660 The first thing we could do is cut spending.

00:04:28.160 That would reduce what we each spend in a household. 0.97

00:04:31.120 But on that note, housing keeps going up.

00:04:35.080 There's been really no fix on affordability in that realm.

00:04:38.780 It continues to rise and remain, you know, out of the reach of so many Canadians.

00:04:44.860 Yeah, you know, this is a major problem.

00:04:48.520 And I deal with it in my life as well.

00:04:51.900 So I'm in my early 30s, right?

00:04:54.100 So all my friends are, I would say, late 20s till about 40s.

00:04:57.960 I'm in their early 40s.

00:04:59.000 So I feel like I'm right kind of in the heart of the people who are trying to progress, you know, maybe take the next stage in their life.

00:05:06.060 And I can tell you, the dream of home ownership, right, which I think used to be a dream for people like my parents' generation and their parents, it's so hard now because the cost of living is so hard that people are just struggling to get by.

00:05:21.580 And when you're just struggling to make the day-to-day bills work out for you, you have a hard time thinking into the future, right?

00:05:28.680 You have a hard time aspiring to buy the home.

00:05:32.520 Yeah, I mean, when you were growing up, a middle-class family had a home.

00:05:37.140 It was a foregone conclusion that if one or both of your parents were employed, you likely lived in a home that they owned.

00:05:44.120 And if you talked to somebody in your neighborhood who was renting, it seemed like a strange thing to do.

00:05:50.240 Are you only here temporarily?

00:05:51.920 Are you, you know, your parents looking for a place?

00:05:54.520 That foregone conclusion is long vaporized.

00:05:57.420 You raise a good point.

00:05:58.500 You're right in the category of somebody who's experienced, okay, it's completely normal to own a home.

00:06:03.440 And now you're at the other end of it experiencing how difficult that is.

00:06:08.020 The government has really made no moves in this regard, in this facet of the cost of living.

00:06:14.260 Yeah, look, and when it comes to homes, right, the big problem is just that it's so hard to build homes in Canada, right?

00:06:21.860 We are one of the largest landmasses in the entire world, right?

00:06:25.820 Look at all the ample space that we have.

00:06:28.380 But you know what makes it very hard for people to build homes?

00:06:31.380 And that is the true problem that is driving up the housing affordability crisis, is that it's just become so hard to actually build homes, right?

00:06:39.800 You have these home builders that have to go through how many different hoops, regulations, different types of taxes.

00:06:46.300 You also have different types of taxes that are driving up the cost of the home building material, right?

00:06:51.500 So it's all these government regulations.

00:06:54.100 You have compounding taxes.

00:06:55.780 Now we're headed toward net zero.

00:06:57.360 There's all of these policies and procedures to be a profitable company, providing materials to the building industry must be a real challenge in this country.

00:07:06.100 Yeah, and it's all levels of government, right?

00:07:07.900 It's not just the federal government.

00:07:09.220 You've got provincial government issues there.

00:07:10.800 You also have municipalities, right, that are making it more difficult for people to actually build the homes.

00:07:15.160 But again, this kind of goes back to my earlier point, where more government bureaucracy is not a solution, right?

00:07:22.360 Government bureaucracy has become the problem.

00:07:24.500 And this also ties into what we're talking about now with Prime Minister Mark Carney, who created a new housing bureaucracy.

00:07:30.600 What was it?

00:07:31.080 Build Canada Homes?

00:07:32.400 Build Canada, yeah.

00:07:33.460 Right?

00:07:33.760 Yeah, yeah.

00:07:34.100 There it is.

00:07:34.840 It almost sounds like a developer's name.

00:07:38.120 He's kind of good at naming these things, huh?

00:07:40.000 Look, another government bureaucracy to improve homes, like home affordability, that's an oxymoron because it's government bureaucracy that is the problem to building more homes, to bring home prices down so more Canadians can finally realize the dream of becoming homeowners.

00:07:56.380 This shocked me a little bit, Franco.

00:07:58.180 Let's chime in on this.

00:07:59.440 Let's look at groceries for a second, which is, you know, sort of a, it really is the canary in the coal mine, I think, for a lot of us looking at the cost of living.

00:08:08.340 And yet, some of the major corporations in this country, Empire, Loblaw, Metro, Walmart, have all had record-breaking profitable years.

00:08:18.060 While we're paying 3% to 5% more for groceries, the grocers themselves are netting anywhere from 12% to 35% profit increases year over year.

00:08:30.580 Yeah, so I'm not the best person to talk about the industry per se, right?

00:08:36.080 Like, it's just not really where my expertise lies, but where I can really speak to it is a couple different things that governments are doing.

00:08:43.900 So, you know, when you look at how governments are influencing food prices, you've got to start with certain types of taxes, right?

00:08:52.020 So, before the last election, the microscope was really on the carbon tax, right?

00:08:57.520 The consumer-facing carbon tax.

00:08:59.620 The carbon tax directly at the gas station, on natural gas bills, things of that nature.

00:09:04.620 But what some people forget about is while the Carney government ended the consumer-facing carbon tax,

00:09:11.120 the Carney government is moving forward with higher industrial carbon taxes, okay?

00:09:15.240 And that also makes food more expensive.

00:09:18.840 And I'll give you just a concrete example.

00:09:20.720 So, the industrial carbon tax is on place on businesses such as fertilizer plants, okay?

00:09:27.140 Well, what is fertilizer used for?

00:09:29.680 And who uses fertilizer and those products? 0.92

00:09:32.180 Farmers, right?

00:09:33.440 Right.

00:09:33.660 So, you drive up the cost of farming.

00:09:35.760 You drive up the cost of actually producing and growing the food.

00:09:40.760 What happens throughout the supply chain, right?

00:09:43.240 Not only that, but it has to be put on a truck.

00:09:46.720 It has to be processed.

00:09:48.340 All of these energy costs and requirements for net zero, you know, I can see the pressure on industry alongside the pressure on consumers.

00:09:59.240 I can certainly see that.

00:10:01.380 And it just flows throughout the entire economy, right?

00:10:04.640 So, when you hit the economy with this type of tax, this type of energy tax at the base of the economy,

00:10:11.060 where everything else is then reliant on that form of energy, well, what are you going to do to the end consumer, right?

00:10:17.500 You're going to make it more expensive.

00:10:19.280 And look, Carney's talked about, oh, don't worry, folks.

00:10:21.340 It's just the large businesses that are going to pay this industrial carbon tax.

00:10:24.520 Well, you know, fortunately, Canadians don't buy that at all. 1.00

00:10:27.280 We just released some Leger polling showing that about 70% of Canadians say, no, no, no, no, no.

00:10:33.920 The industrial carbon tax, most or some of those costs are going to be passed on to the consumer at the end of the day through higher prices.

00:10:41.160 Yeah.

00:10:41.640 Yeah.

00:10:41.960 No, that's and that's consistent over the last decade, frankly, that, you know, we see it.

00:10:47.740 It's at the last it's at the last point, the consumer point.

00:10:51.460 But we do feel it eventually, no matter what it's what is said at the provincial and or federal level.

00:10:58.520 This is interesting.

00:10:59.700 I took a look today online and found the stages of a cost of living crisis.

00:11:04.860 You interested in this?

00:11:05.860 This is might sound a little familiar.

00:11:08.660 It starts with a housing cost explosion.

00:11:11.520 Rents, mortgages, property taxes, insurance, utilities all go up at the same time.

00:11:15.800 And housing alone now eats an unsustainable share of the household income.

00:11:20.360 Sound familiar?

00:11:21.460 Food prices are the next to surge, driven by fuel costs, carbon taxes, fertilizer prices, transport, supply chain, fragility and market concentration and grocery retail that limits real competition.

00:11:34.700 We only have three energy, maybe four energy and fuel costs ripple through everything.

00:11:40.880 Higher gas, diesel, home heating, push up the cost of transporting goods, running businesses, even just getting to work.

00:11:47.100 And then wages fail to keep up.

00:11:50.260 Well, all of this is put into place.

00:11:54.080 Government policies, new taxes, new procedures, higher costs along the way.

00:11:59.740 We fail to earn more.

00:12:01.340 And then the next thing that happens is government policy amplifies the pressure with taxes, fees and regulatory costs.

00:12:08.300 Yeah, and that's the government, right?

00:12:10.340 Like they create the problem in the first place and then they try to solve it, which makes the problem even worse, right?

00:12:15.240 It's like the government breaks your legs and then hands you a crutch and then expects a thank you.

00:12:21.720 Right?

00:12:21.800 This is like kind of – this is – I mean economists very – well, the good economists at least have been talking about this for a very long time, whereas the government that originally creates the problem and then the government tries to fix the problem it created and then the government makes the situation even worse.

00:12:37.800 I think if you approached any Canadian and said to them, it's a good thing to keep printing money, right?

00:12:44.800 They would – everybody to – I think 100% of people you asked would say, no, don't print more money.

00:12:51.720 We're in trouble already, you know?

00:12:53.520 And I think that we've been – I don't know how that we've succumbed to this pressure to allow the deficits to get this high, to allow taxation to get into a place where it's the only way to solve the problem.

00:13:05.000 Do you see any cracks on the horizon of light that we can look at that might make it better for Canadians from a cost of living standpoint, Franco?

00:13:16.420 Well, hey, let me just explain the inflation tax real quick because this is really one of the worst forms of taxation.

00:13:23.320 It's a fundamentally undemocratic form of taxation and make no mistake about it, it is a form of taxation.

00:13:29.460 And that's when the central bank creates new dollars right out of thin air, buying financial assets, largely government bonds, i.e., financing massive deficits in Ottawa, okay?

00:13:41.160 And the key problem – this is where inflation really stems because throughout the economy, you can get some prices going up, but if you're not creating new dollars, then other prices would go down, right?

00:13:51.940 If there's only so many dollars in the economy, one price goes up, another price goes down.

00:13:56.060 Now, what creates this general increase in inflation year after year after year is the money printer, okay?

00:14:03.960 The fact that through the central bank, the government can essentially create a new dollar out of thin air with a click of a keypad.

00:14:11.160 Well, the problem for normal people is that you can't create farmland with a click of the keypad.

00:14:16.920 You can't create gasoline with a click of a keypad.

00:14:19.640 So, through the central bank, and we saw this big time during the pandemic where the Bank of Canada printed up more than $300 billion out of thin air, is that you create the perfect storm of inflation, which is too many dollars chasing too few goods.

00:14:35.420 And, oh, by the way, Canadians never voted on that, right?

00:14:38.740 Fundamentally undemocratic.

00:14:40.420 That is the inflation tax, folks.

00:14:42.040 Now, I like to think of myself as an optimist, so if I can see any optimism here, it's that at least the governing liberals under Carney, at least they have to admit that they need to control spending, right?

00:14:58.540 They're still increasing spending by $38 billion this year, but they're starting to understand that they can't lose any more credibility on the finances, so they at least have to pay lip service to reining in spending.

00:15:11.180 Now, they're not reining in spending, but they at least have to pay lip service to it.

00:15:14.760 Yeah.

00:15:15.300 It's interesting.

00:15:16.120 That just sounds like Ozzy Osbourne waking up after a night of partying in his hotel room after trashing it and saying, you know what, I really got to slow down.

00:15:24.380 But it's already, the damage is already done.

00:15:27.400 But having said that, it does seem to me that we might be in for a long haul because a lot of money was printed.

00:15:34.180 We have a huge deficit.

00:15:35.440 There is only one way forward, and that is to start to rein that in.

00:15:39.000 And this feels to me like for taxpayers, this is a long haul.

00:15:43.280 And I don't even know if a change of government could make a difference to that.

00:15:47.660 Well, you certainly need a change in culture, right?

00:15:51.120 I think that has to go with it.

00:15:54.800 You know, I see that there's kind of two paths forward, but both have to be done, right?

00:15:59.720 So number one, you have to cut spending.

00:16:03.060 You can't just keep running these massive deficits.

00:16:05.020 Like the Carney government is going to borrow $80 billion this year, $78 billion according to budget 2025.

00:16:10.940 No plan to stop borrowing money.

00:16:12.500 No plan to balance the budget.

00:16:15.060 So what has to happen from the federal government is you have to cut spending.

00:16:19.300 You have to cut spending.

00:16:20.340 You can't keep borrowing money like this.

00:16:22.200 You got to start paying down the debt.

00:16:23.600 That has to happen.

00:16:24.500 Now, we saw the closest thing that I think that we're facing today is similar to the mid-90s in Ottawa, right?

00:16:32.040 Remember that we actually had to cut spending, balance the budget.

00:16:35.540 The second thing that you have to do is you have to make more of stuff that the money buys, right?

00:16:41.360 So you have to get the government out of the way so that the economy can grow and that we can produce more stuff.

00:16:47.040 Like those are the two things that has to happen.

00:16:48.860 It's funny.

00:16:49.600 We say that we're the biggest resource rich country within any stretch of the eye, and yet we have so many restrictions put upon us to get those resources.

00:17:02.060 You know, we got them, but we don't process them.

00:17:04.840 We ship them away.

00:17:07.100 We find ways to stop producing for some reason.

00:17:11.060 We as a country need to start making stuff again.

00:17:13.420 And that all starts with the government getting out of the way.

00:17:18.180 Like, folks, we should be the freest, most prosperous country in the world.

00:17:23.120 Like, think about all the different natural resources that we have all over Canada.

00:17:27.220 All over Canada.

00:17:28.360 Not only that, we have a very well-educated population.

00:17:31.740 Like, we should be the freest and most prosperous place in the world.

00:17:35.680 Why are we not?

00:17:36.660 Not significant government regulations strangling our ability to grow, specifically our natural resource sector.

00:17:44.260 Like, we should be a natural resource powerhouse, right?

00:17:47.900 But, hey, the federal government brings in a carbon tax, then a second carbon tax, then an industrial carbon tax, then a no more pipelines law, then a discriminatory tanker ban on the West Coast.

00:17:57.000 The government flirts with the production cap on oil and gas, right?

00:18:00.540 Look, the government moves the regulatory goalposts on the Energy East pipeline, rejects the Northern Gateway pipeline.

00:18:07.020 I could go on and on and on.

00:18:08.860 Why are we stagnating?

00:18:10.980 Because Ottawa.

00:18:12.100 We need Ottawa to get out of the way.

00:18:14.100 We don't move.

00:18:14.860 Ottawa would be better to just stand to the side for a moment.

00:18:18.700 Maybe while Mark Carney's offline around wherever his next trip is, everybody could just take a step to the side and we'll get back to work.

00:18:26.880 Franco, I really appreciate this.

00:18:28.940 You can't even imagine.

00:18:30.260 Where can people find out more about what you're doing and how they can support it?

00:18:34.280 Hey, that was fun.

00:18:34.960 I really appreciate it, folks.

00:18:36.280 The best way to learn more about the Canadian Taxpayers Federation is to go to taxpayer.com, taxpayer.com.

00:18:42.680 A lot of great resources there for you.

00:18:44.680 You know I'll be in touch with you again right in the new year, if not before.

00:18:48.040 Thanks so much, Franco.

00:18:49.520 Hey, that was fun.

00:18:50.240 Thank you.

Cost of Living Crisis： Franco Terrazano Says Government Spending Is Crushing Canadians

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