Canada's Trudeau-induced economic coma
Review of the severely negative economic and social outcomes Canada has suffered under Prime
Minister Justin Trudeau.
GDP:
Since Trudeau took office through the third quarter of 2024, cumulative real GDP per capita growth in
Canada has been about 1.7 per cent. That is 1.7 per cent growth in nearly a decade in Canada versus
about 18.6 per cent in the United States . Put another way: if Canada’s real GDP per capita growth
tracked with the U.S. since Trudeau took office, Canadians’ incomes would be about 17 per cent higher
on average. In contrast, under the previous Conservative government, Canada tracked much more
closely with the U.S., with cumulative real GDP per capita growth of 5.2 per cent in Canada versus 7.7
per cent in the United States from the beginning of 2006 through to the third quarter of 2015. The two
countries were essentially tied through to the end of 2014 (Canada held at 6.1 per cent with the U.S. at
6.2 per cent) before declining oil prices stalled Canadian GDP. So economic growth under Trudeau is
clearly a disaster. How about business investment, which is the engine behind the productivity
improvements on which standards of living rely? Unfortunately, since Trudeau took office, data from the
latest quarter show business investment in non-residential structures, machinery, equipment and
intellectual property down 8.2 per cent on a real per capita basis. Meanwhile, real business investment
per capita is up 34.5 per cent in the U.S. over the same time period — an astonishing divergence
between the two countries. People just don’t want to invest in Canada anymore.
Jobs:
Since Trudeau took office, public sector employment is up 25.2 per cent according to last month’s
numbers, double the rate of private-sector and self-employment growth of 12.5 per cent — and that is
before accounting for all those jobs that are statistically reported as private-sector jobs but are
effectively publicly funded, such those employed at electric vehicle battery plants that got billions in
taxpayer funds . And while the total public sector is up 25.2 per cent in terms of jobs, federal public
administration in particular is up 43.1 per cent from 2015 to 2024, including 47.7 per cent headcount
growth at the Canada Revenue Agency. It cannot be surprising that CRA headcount is up so much,
because taxes have gone up too. Since coming to power, Trudeau established a new top personal income
tax bracket , increased Canada Pension Plan taxes for six consecutive years with a seventh increase
planned in January 2025 (real increases, far above merely indexing to inflation), introduced a carbon tax
in 2019 with annual real increases until 2030, subjected financial institutions to punitive special taxation,
similarly threatened grocery stores with punitive special taxation, proposed a stock buyback tax,
increased capital gains taxes in 2024 and has shows strong enthusiasm for implementing tax changes
with significant bureaucratic and administrative requirements. While taxes have gone up, the higher
spending outpaced taxes: nominal debt was only $701 billion in 2014-15, but has approximately doubled
to $1.4 trillion by the end of this fiscal year, 2024-25. Where has all this spending gone? It has been
wasted. Health care wait times have risen ever higher, Canada’s national defence is a complete
shambles, and after the federal government initiated an effective takeover of the child-care sector in
2021 with billions in new spending, the proportion of parents who reported having difficulty finding child
care (among parents who use it) rose to 49 per cent in 2023 — up from 36 per cent in 2019, before
national child care was implemented.
Crime:
has also gone in the wrong direction since Trudeau took office. Statistics Canada’s violent crime severity
index hovered around the same level from 1998 to 2006, before declining steadily by 29 per cent from
2006 to 2014. However, in 2015, violent crime began rising again, so by 2023 the violent crime index was
more than 40 per cent above the 2014 level. The downward trend in non-violent crime also reversed in
2015, although the increase through to 2023 has been less pronounced. Meanwhile, as government
fixation on identity politics intensified greatly under Trudeau, police-reported hate crime (crime
motivated by race, colour, ethnicity, religion, etc.), has more than tripled from 2015 to 2023. When 2024
data is published, it will undoubtedly show the alarming upward trend continuing or accelerating:
through the first three quarters of the year, Toronto police reported a 40 per cent annual increase in hate
crimes, including a 69 per cent increase in hate crimes against Jewish people.
To recap, since Trudeau took office, average incomes are 17% lower than what they would be if Canada
tracked with the U.S., business investment is down, taxes and the federal bureaucracy are much more
expansive, public debt is higher and outcomes are worse in health care, safety and any other sector or
service with increased federal involvement. Economic and social trends that were doing well or
improving before Trudeau came to power are now doing worse, in some cases significantly so.
