In a recent interview, federal Finance Minister Chrystia Freeland explained the need to focus on economic growth to deal with many of Canada’s fiscal issues including our high debt levels. Minister Freeland is correct that higher rates of economic growth would solve many of the country’s issues. Unfortunately, her policy prescription for higher growth is more of the same—more debt-financed government spending and new and higher taxes—which has delivered lower, not higher, economic growth since the Trudeau government came to power.
A recent study compared the economic performance for the four-year periods preceding the last five recessions (or economic slowdowns)—specifically, the economic performance of 2016-19 (Trudeau), 2011-14 (Harper), 2005-08 (Martin-Harper), 1997-2000 (Chrétien) and 1986-89 (Mulroney).
The results were clear, both in terms of overall economic growth (GDP) and growth in per-person GDP. The Trudeau government experienced the weakest economic growth compared to the previous four governments. For per-person GDP growth, the results weren’t even close. Trudeau recorded average growth of 0.8 per cent, which was 50 per cent lower than the next lowest performer (1.2 per cent during the Martin-Harper period of 2005-08).
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