Without a doubt, this debt service is lower than ever. But that does not mean that taxpayers are not required to pay it; they just never stop paying it.
Now it is necessary to point out that the sums we are talking about are so mind-boggling — $ 621 billion in government spending this year — that shocked citizens have ignored them. Perhaps we should call it the banality of spending, a minister who buys a $ 16 orange juice causes thrombosis, but a government that doubles the net federal debt in five years would be re-elected by the majority if elections were held tomorrow. Likewise, it has been argued that liberals could be excused for their mistakes in the early fog of the pandemic. As one veteran policymaker pointed out, Ottawa realized that it could be fast or precise, but not both.
However, given the opportunity to realign benefits closer to loss of income, Liberals doubled, increasing the money available under wage subsidy and spending an additional $ 1,200 in Canadian child benefit to 1.6 million families.
Errors established as virtues?
A rather curious fact is that now errors are presented as virtues, being that a “previous load” of stimuli in bank accounts throughout the country. That pent-up demand hasn’t eliminated the need to inject another $ 100 billion in stimulus into “time-limited, smart investments” over the next three fiscal years.
Likewise, stimulus spending, by its very nature, is temporary. However, in another part of the fiscal update, the government pledged to make “historic investments” in a national daycare system and the implementation of universal drug therapy. The indefinite temporary spending package envisaged in the fiscal update would average a deficit of $ 115 billion over three fiscal years and the debt-to-GDP ratio would average 57 percent, BEFORE any additional spending on child care, pharmacology, or health. In addition, it is necessary to mention that it is not mentioned how any of these expenses would be paid; it would simply add to a national federal debt that rose from $ 615 billion when the Trudeau government took power to $ 1.2 trillion this year.
The cost of servicing that debt is lower than ever and the government promotes a management strategy that is set at low rates by issuing more long-term debt. But that does not mean that taxpayers are not required to pay it; it just means they will never stop paying it.
The only tax increases in the tax update were applied to corporations, in this case, GST and HST on digital products and goods stored in fulfillment warehouses. Inevitably, they will be passed on to consumers, but that is not a government concern. Likewise, Trudeau and Finance Minister Chrystia Freeland are confident of getting election credit for large increases in program spending, while avoiding responsibility for rising debt levels.
Source: John Ivison | National Post