While the Trudeau government continues to wrap itself in the Canadian flag, claiming to defend our national interests in the face of U.S. President Donald Trump’s looming tariff war against us, it has in fact done the opposite.
Its chronic overspending, resulting in big deficits and debt, has undermined the government’s ability to provide income support to businesses and workers who will be hardest hit in an all-out trade war.
This warning to outgoing Prime Minister Justin Trudeau came from Chrystia Freeland, his former finance minister and deputy prime minister, now running for the Liberal party leadership, on the day she was to deliver the government’s fall economic statement in December.
Instead, she told Trudeau his decision to boost the federal deficit last year to $61.9 billion, 54% higher than the $40.1 billion upper limit Freeland had said was necessary to maintain “Canada’s responsible fiscal anchor” in her 2024 budget, left her little choice but to resign.
“Our country today faces a grave challenge,” Freeland wrote. “The incoming administration in the United States is pursuing a policy of aggressive economic nationalism, including a threat of 25% tariffs.
“We need to take that threat extremely seriously. That means keeping our fiscal powder dry today, so we have the reserves we may need for a coming tariff war. That means eschewing costly political gimmicks, which we can ill afford and which make Canadians doubt that we recognize the gravity of the moment.”
The “costly political gimmicks” Freeland referred to meant the temporary GST/HST tax break on some consumer goods from Dec. 14, 2024, to Feb. 15, 2025, that the Liberals and NDP approved.
Parliamentary budget officer Yves Giroux subsequently reported on the Liberals’ fall economic statement, the last independent, non-partisan evaluation of Trudeau government spending taxpayers will get prior to this year’s federal election.
It wasn’t pretty. Giroux found shoddy bookkeeping, data manipulation, unacceptably long delays in reporting public accounts and failure to adequately account for billions of dollars in potential contingent liabilities the province is facing.
In other words, as the late American author, journalist and political satirist P.J. O’Rourke once described it in another context: “Giving money and power to government is like giving whiskey and car keys to teenage boys.”