Trudeau Drops Campaign Promises - Goes All In With Deficits

[Selene]

Let ye who is free from deficits throw the first budget!!

The Donald proposes a Northern Financial Wall to keep out Trudeauian Economic Radical Terrorists from Canada!

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In for a penny, in for a pound.

With falling oil prices eroding Canada’s revenue base, newly elected Prime Minister Justin Trudeau is fully embracing deficits, with his finance minister hinting Monday the country will run a deficit of about C$30 billion ($22 billion) in the fiscal year that starts April 1.

It’s one of the biggest fiscal swings in the country’s history that, in just four months since the Oct. 19 election, has cut loose all the fiscal anchors Trudeau pledged to abide by even as he runs deficits. The government’s bet is that appetite for more infrastructure spending and a post-election political honeymoon will trump criticism over borrowing and unmet campaign promises.

“It looks like the Liberals want to front load as much bad news as possible in the hope when the election occurs in four years things will be better,” said Nik Nanos, an Ottawa-based pollster with Nanos Research Group.

Trudeau swept to power in part by promising to put an end to an era of fiscal consolidation the Liberals claimed was undermining Canada’s growth, which has been lackluster since the recession in 2009. Still, he has tried to temper worries by laying out three main fiscal promises: annual deficits of no more than C$10 billion, balancing the budget in four years and reducing the debt-to-GDP ratio every year.

Trudeau is:

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'... happy to talk about campaign promises.' Trudeau told lawmakers in Ottawa, citing his pledge to strengthen employment insurance, boost investments and help middle-class families.

To be sure, the worsening fiscal outlook is hardly deleterious for Canada. The nation will continue to be the least indebted country in the Group of Seven and holds a stable AAA rating from Standard & Poor’s, Moody’s Investors Service and Fitch Ratings. The Bank of Canada, and other economists, have been making a case for more fiscal expansion given borrowing costs are at historic lows.

'It’s important to point out this is not an ’80s, ’90s-style deficit interest rate spiral,' said Kevin Milligan, an economics professor at the University of British Columbia who advised Trudeau on his election platform.

http://www.bloomberg.com/news/articles/2016-02-23/trudeau-drops-campaign-promises-and-goes-all-in-with-deficits

[Michael Stuart Kelly]

How is this possible?

Michael

[Jules Troy]

It's gunna be ok!  He will just selfie himself until it blows over.

Talk about blowing smoke.

He upped taxes on the "1%" of which there are 0nly about 267000...

he lowered taxes by about $8.00/month on everyone else (a net loss of about 1.2 billion)

he slashed the TFSA (tax free savings account) from 10k/year down to 5500 saying "only the 1% use that". WRONG!!!  Everyone can use it.

Didnt touch RRSP's ...dumbass, the 1% can max out RRSP's and drop them "under" the extra tax grab bracket.(hope he doesn't read this).

With keystone XL a bust the one thing that might bring in extra cash? Energy east pl...

[william.scherk]

On 2/24/2016 at 5:27 PM, Selene said:

The Donald proposes a Northern Financial Wall to keep out Trudeauian Economic Radical Terrorists from Canada!

Yeah!  And the internet, too.

On 2/24/2016 at 5:48 PM, Michael Stuart Kelly said:

How is this possible?

Communism.

6 hours ago, Jules Troy said:

It's gunna be ok!  He will just selfie himself until it blows over.

Talk about blowing smoke.

He upped taxes on the "1%" of which there are 0nly about 267000...

he lowered taxes by about $8.00/month on everyone else (a net loss of about 1.2 billion)

he slashed the TFSA (tax free savings account) from 10k/year down to 5500 saying "only the 1% use that". WRONG!!!  Everyone can use it.

Didnt touch RRSP's ...dumbass, the 1% can max out RRSP's and drop them "under" the extra tax grab bracket.(hope he doesn't read this).

With keystone XL a bust the one thing that might bring in extra cash? Energy east pl...

The hellhole.  The AAA rating. The least indebted country in the G-7.  Tax-and-spend-into-a-hole is marked on the Liberal keyboard and almost DNA-typed into the Liberal tradition of the twentieth century. Americans may not be aware of the Paul Martin tradition -- which was that of a finance minister and government which delivered balanced budgets. When the Liberals were last in power, they developed a reputation for relative financial prudence.

It is more than disappointing to conservatives that Trudeau does not conserve in the Martin tradition of the nineties. In the seventies, the elder Trudeau opened up deep regional divides in Canada, by trying to grab royalty/tax revenue from its constitutionally-provincial ambit -- in a fit of communism called the National Energy Program.  This set up the conditions for the Reform Party of Preston Manning, and the eventual emergence of Stephen Harper. Now we have reversed to 1980 ... in a sense.  Although I don't believe in my wildest imaginings that the younger will emulate the elder's NEP. Some things Mr Thompson-like just cannot be repeated.

The Wall for Canada will come in perhaps around the time Trudeau has his pot legislation promulgated. Earlier bruited legalization met with bared teeth from Washington.  But who knows which way is up in a Trump administration?

I would pay to watch a cage-match between Trump and Trudeau or Trump and Rachel Notley. More likely is a Trump presidency and the tradition of Air Force One heading north in the first official 'foreign' trip.  Trudeau's Muslim cabinet ministers and backbenchers will no doubt be part of the show, trying to cut side deals so their families can travel to Vegas and other ports south without a bar due to religion.

As Jules suggests, Canada as a whole will be fine.  We are almost all used to the general fires of hell in the hellhole.  A little more heat, meh.  We thrive and survive on trade.   If by chance Mr Trump wants to retaliate against Canada for its unfair trade surplus with America, there is always a Sugar Tariff, as Adam can tell us.

Edited February 25, 2016 by william.scherk
Added more Zzzzzzz about Canada's political history

[Jules Troy]

Weeee on the Trudeauian debt snorfling.  

So...the CDN has gone from pretty much on par with the USD just over a year ago down to the 70 cent range.  Oh sure go into debt more! Interest rates are cheap!  Meanwhile the US has and willlllll be raising interest rates more over the next couple of years while Canada stagnates.  Historically whenever the US raises rates Canada within a few months follows suit.  If Canada DOESNT follow the US lead the CDN will drop like a rock..