Madam Speaker, it is my pleasure to split my time with the fabulous member for Niagara Falls.
My hope was that this budget would contain provisions that would provide a road for economic recovery. Unfortunately, while the government announced record spending, it did not introduce a responsible economic recovery plan. This is something my constituents are rightfully concerned about, as the debt that will be incurred will be felt for literally generations.
The temporary measures put in place during the pandemic were always seen by me as a bridge to brighter days, a future where Canadians could return to their normal lives, content in the knowledge that Canada was secured by a thriving private sector and a supportive government. However, increasingly it appears the government is content to build a bridge to nowhere, a future not of abundance and freedom but instead characterized by debt-created scarcity.
In a report last week, the C.D. Howe Institute warned “fiscal stability would still be jeopardized by the prospect of other expensive initiatives recently floated by the federal government.” The fact that the private sector is recovering through its own determination, perseverance and innovation seems to be not deterring the government from making record expenditures. “An improving economic outlook has weakened the case for stimulus”, is what the RBC said, “though the government's appetite to spend hasn't changed.”
The Liberal government's solution may very well do more harm than good. A recent Parliamentary Budget Office report noted that another stimulus package was not what was needed now. While temporary stimulus of this magnitude would likely provide a significant boost to the Canadian economy, it would result materially in larger budgetary deficits and higher federal debt over the long and medium term.
None of this spending is conditional. The government is going to spend it anyway, without knowing what will happen in the economy in three to five years. The public is completely and unfortunately being desensitized to these massive deficits. Running $30 billion for one program used to be a lot of money. This is revenue that could be directed to support our important social safety net. For example, in 2026, the government will spend $8.3 billion on child care, but $39 billion on debt interest payments.
Every day this year, we will spend $422,465,750 more than what we will generate in revenue. Every Canadian is taking on more than $100 every day in new federal debt. For a family of four, that equates to more than $3,000 a week in new federal debt. Many families do not earn $3,000 a week in total, much less taking on $3,000 each week in new federal debt.
The government's own fiscal projections show that in four years we may have a debt-to-GDP ratio of under 50%. Talk about moving the goal posts. This rivals them setting a target for vaccinations such that, if we achieve it, we may be in the top 100 in the world. According to this projection, this unremarkable achievement is a goal that we should not be attempting to achieve, but even if we do attempt to achieve it, it may be impossible. The problem with this idea is that it expects nothing unexpected to happen. However, we know, from 9/11 to the great financial meltdown to the global pandemic, nearly always something unexpected happens.
Prime Minister Harper rebuilt our financial house after the financial crisis of 2008, which allowed us to weather this latest crisis, despite five years of excessive spending. The challenge we are facing now is that we will simply not be able to weather another significant economic shock. The next shock could come any number of forms, perhaps a collapse in the housing market, the escalation of global tension, a rise in inflation or in interest rates, the devastating impacts of climate change, because even though we in the House have committed to reducing our carbon output, China continues to dramatically increase theirs.
Nobody, including the Prime Minister's millionaire friends who helped draft this budget, know when the next shock could be.
What will we do if this shock happens and we have a debt-to-GDP ratio in excess of 50%, or even just below 50%? We simply will not have the firepower to respond to it. However, maybe we will be extraordinarily fortunate and not experience an economic downturn in the next 10 years. Maybe interest rates will remain at historic lows, which may mean that maintaining a 50% debt-to-GDP ratio might be sustainable. Even if that were the case, I still have some skepticism that the government would be able to stay within its means.
The best projections for the future are usually generated by studying the past. The government was elected in 2015 with a promise to deliver a balanced budget after running several itsy-bitsy, modest deficits, then it said it would maintain surpluses for the remainder of its mandate. This, however, did not happen. The budget did not balance itself, as it turns out. Balancing the budget would have taken relatively modest tweaks to either increase revenue or reduce spending, but the government simply lacked the ability, discipline or the will to make this happen.
Achieving a debt-to-GDP ratio of less than 50% would require a massive reduction in government expenditures in the coming years and would involve tough decisions, including inevitably bringing to an end many pandemic support programs. The government, which could not reduce spending or grow revenue by billions pre-pandemic, is now telling us it will reduce spending not by billions, but by hundreds of billions. Please excuse my skepticism on this.
The finance minister, in her budgetary address, repeatedly stated that her plan for the future would grow the economy out of debt. In principle, I agree with that approach. Economic growth is the best and maybe the only path forward to help us maintain our jobs and pay down our massive debt. However, this budget simply will not achieve that stated objective. This budget continues the unprecedented level of spending and government interference in the economy.
Over 2,000 years of economic history has proved to us, over and over again, that while the government can build a framework to support businesses, it cannot create economic growth by itself. Let me be clear that only the private sector, only Canadian workers through their perseverance, tenacity, work ethic and innovation, can expand our economy. While the government cannot in itself create economic growth, it can certainly inhibit or even stop economic growth by overburdening the private sector with needless regulation and excessive taxation
The budget's forecast of $1.4 trillion of national debt has the potential to starve our economy and future businesses of the capital they need to grow and expand. The servicing costs of this debt will force our government to put a greater burden on our workers and confiscate their ability to invest in our economy.
Why, then, would the government table a budget that introduces unneeded stimulus and massive amounts of spending? French philosopher Alexis de Tocqueville once wrote that democracy will endure until the day that politicians realize they can bribe people with their own money. It is clear to me that the government is utilizing the power of a budget to table an election platform, not an economic recovery plan, with the hopes of buying Canadian votes with their hard-earned money.
We have reached a moment of truth. There is a tipping point, if not in this budget, then in the next election. We must decide whether we believe in Canadians or in an ever-expanding federal government. Do we believe in democracy or bureaucracy? Do we believe in Canadians' ability to decide their own destiny, or in an ever-growing centralized government that controls Canadians' lives?