HEY, BIG SPENDER
Inherited good fortune and ‘blew every penny’: Tories
OTTAWA • Prime Minister Justin Trudeau is on track to spend more on federal government programs than any prime minister before him, according to a new study, but his predecessor Stephen Harper still holds the record for the single most expensive year.
Trudeau’s government will have spent about $8,600 per Canadian on programming for the 2018-19 financial year, according to the Fraser Institute, a right-leaning thinktank.
That’s a bit less than what Harper spent in 2009, during the economic recession, and about 50 per cent more than average spending during the last long-haul Liberal tenure under Jean Chrétien and Paul Martin.
The findings come as Conservative politicians hammer away at Trudeau for running large deficits in his first three budgets as prime minister. According to numbers released in November’s fiscal update, the deficit for this financial year alone is projected to be $18.1 billion, and debt is expected to rise by $96.7 billion over the next five years to $765 billion in total.
Pierre Poilievre, the Conservative Party’s finance critic, said in a statement Tuesday he thinks Trudeau’s “out-of-control spending” will be a ballot-box question in the 2019 federal election. “He is costing Canadians a fortune.”
The study’s authors looked all the way back to 1870, adjusting dollar amounts for inflation and population.
The numbers don’t include interest paid on the national debt, the paper says, since what governments inherit is not always under their immediate control.
Big spikes on the timeline are reflective of world events. In the first half of the 20th century, for example, Canada was spending many times as much during the First and Second World Wars as it was during peacetime, with increases in programming costs directly tied to military spending.
Spending went up from about $1,000 per person in the late 1930s to about $7,000 at the height of the war and back down to under $2,000 in the late ’40s before beginning a steady increase, including through the Pierre Trudeau years, that stabilized under Progressive Conservative Brian Mulroney’s government in the ’80s and was brought down under Chrétien. Liberal fiscal reforms reduced spending by 16.5 per cent per person in Chrétien’s first three budgets, according to the analysis.
The study identified which Canadian prime ministers have increased or decreased spending the most. Liberal PM Louis St. Laurent oversaw the biggest post-war increase (up seven per cent), partly explained by Canada’s participation in the Korean War in the early ’50s. Since then the biggest average decline was under the PCs’ Joe Clark (down five per cent), but he was only prime minister for nine months.
Mulroney and Chrétien each oversaw a modest decline in per-person spending of 0.3 per cent from the year they entered office to the year of their leaving office. Under Martin, from 2004 to 2006, the average annual increase was 2.6 per cent; it was 1.5 per cent under Harper and is 3.1 per cent under Trudeau so far.
The study points out that Trudeau’s tenure “has occurred during a period of stable economic growth (i.e. no war or recession).”
The last few years have not been without uncertainty. At the behest of an unpredictable United States president, the North American Free Trade Agreement was reworked. Pipeline politics have raged on domestically, with Trudeau attempting to walk a fine line between prioritizing resource development and environmental protection. His government nationalized the Trans Mountain pipeline extension project for $4.5 billion last year, what seemed to be a lastditch option with the project poised to fall apart.
The Liberal government has shrugged off criticism of its budgetary deficits. Trudeau remains in a strong polling position headed into the campaign. His finance minister, Bill Morneau, is unwavering in his insistence that the government’s plan will “keep our economy strong and growing,” as it was put in a Finance Canada statement on Tuesday.
Still, responding to the Fraser Institute’s research, Poilievre argued the fact Trudeau “inherited great fortune” at the start of his tenure gives him no excuse to keep spending levels so high. “A balanced budget, roaring world and U.S. economies, booming housing markets in our biggest cities and record low interest rates all generated windfalls of tens of billions in unexpected government revenues after Trudeau took office,” he said. “He blew every penny.”