Canada – Trillion With A ‘T’

Ottawa to post $343B deficit as spending hits levels not seen since Second World War

Finance Minister Bill Morneau tabled a fiscal snapshot today that shows the federal government’s deficit is expected to hit $343 billion this year — an eye-popping figure largely attributed to pandemic-related support programs that have pushed federal spending to a level not seen since the Second World War.

The 168-page snapshot offers a short-term economic analysis and a detailed account of what the government has spent already to shore up an economy on life support. It presents little in the way of a long-term plan to return the economy to pre-pandemic normalcy.

“Some will criticize us on the cost of action,” Morneau said in a speech in the House of Commons today. “But our government knew that the cost of inaction would’ve been far greater.

“Those who would have us do less ignore that, without government action, millions of jobs would have been lost, putting the burden of debt onto families and jeopardizing Canada’s resilience.”

What we’ve learned from this fiscal snapshot:

  • Deficit for 2020-21 rises to $343.2 billion from $34.4 billion projected before pandemic.
  • Net federal debt will hit $1.2 trillion.
  • Federal debt-to-GDP ratio is expected to rise to 49% in 2020-21 from 31%
  • Direct federal support for Canadians and businesses: $212 billion.
  • COVID-19 slowdown has cost the federal treasury an additional $81.3 billion.
  • GDP will shrink by projected 6.8% this year — worst since the Great Depression.
  • Economy is expected to bounce back by 5.5% next year – cbc

read full article here

  • Deficit for 2020-21 rises to $343.2 billion from $34.4 billion projected before pandemic.
  • Net federal debt will hit $1.2 trillion.

Remember, this is only the Federal deficit.  There are the Provinces and Municipalities to add in as well. ALL levels of governments are funded by the same taxpayers.

Sooo, this year, governments spent well over half a trillion dollars more than they took in.  $1.2 trillion. This level of debt will NEVER be paid off.   How high does the tax rate need to be just to balance the Federal and Provincial books let alone pay off a $1.2 trillion debt?

When was the last time Ottawa or Queens Park ran a surplus budget?  Do you really believe either government can run surplus budgets indefinitely?

What happens if the economy has to be shutdown again? This fall for example. We are threatened with that possibility on a daily basis. Can the country/province afford to shut things down again?  I believe the answer to that question is no.

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2 Responses

  1. bill westly
    bill westly at | | Reply

    Chinese won the Third World War and never fired a shot…now they can move in for the kill. Keep buying their junk World, fill their pockets with cash, CCP thanks you.

  2. bill westly

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