Social Policy in Ontario

Say what you want about Justin Trudeau — there’s still no arguing Canadians became wealthier while he was in power

Posted on January 7, 2025 in History

Source: TheStar.com — Authors: David Olive

TheStar.com – Business/Opinion
Jan. 6, 2025.   By David Olive, Star Business Columnist

Justin Trudeau, who announced his resignation as federal Liberal party leader Monday, making way for a party leadership race and a new prime minister, began his premiership by promising “sunny ways” for Canada.

At first glance, Trudeau would appear to have fallen short of that goal.

Quite the opposite is true, however. We’ll get to that.

Canada is beset with cost-of-living and housing crises.

And it faces a stall in economic growth from U.S. president-elect Donald Trump’s threatened steep tariffs on imported Canadian goods.

Trudeau’s exuberant optimism on taking office Nov. 4, 2015, proved no match for the cascade of unforeseeable misfortunes to follow.

Price inflation alone shortened the political careers of Kamala Harris, Britain’s Rishi Sunak and New Zealand’s Jacinda Ardern, among others.

First came the 2018 trade war with Donald Trump in his earlier presidential term.

That inexplicable attack on Canada and America’s other trading partners, soon to be repeated, was followed not long after by the world’s first genuine pandemic, meaning that it touched the four corners of the world as none before had done.

The lockdowns required to stop the spread of the COVID-19 virus eroded the public support of almost every leader who imposed them.

The global economy was largely shut down for the first time. When the coronavirus danger had passed, it was then suddenly reopened for the first time, unleashing historically high inflation as goods in short supply skyrocketed in price.

The only cure for the spiralling inflation was abnormally high interest rates, which zoomed to five per cent from 0.25 per cent in what seemed like the blink of an eye.

Any one of those health and economic hardships had potential to wreak permanent damage.

And there were moments when it seemed they did.

Yet Trudeau’s successors will be hard-pressed to improve on his economic track record.

In the Trudeau years, the Canadian economy grew by 41 per cent, to $3.2 trillion. It grew by just 18 per cent under Trudeau’s predecessor, Stephen Harper, who governed for roughly the same amount of time.

Per capita income grew by more than 23 per cent on Trudeau’s watch, to $77,700, according to the International Monetary Fund (IMF). Trudeau’s predecessor managed only a 7.6 per cent increase.

In the main, Canadians became wealthier in the Trudeau years. The median net worth of Canadians soared by about 66 per cent between 2016 and 2023, to $519,000, according to Statistics Canada.

Trudeau came to office with a mandate to engage in deficit spending, and spend he did on both physical and social infrastructure.

Yet Canada’s federal debt to GDP ratio increased only modestly, to almost 50 per cent in 2023, the latest figures available, from 43 per cent in 2015.

On that basic measure of fiscal prudence, Canada ranks better than all G7 countries save traditionally frugal Germany’s 45 per cent.

In the Trudeau years, America’s debt-to-GDP ratio jumped to 112 per cent from 86 per cent.

Trudeau invested heavily and widely.

He spent about $34 billion to twin the Trans Mountain pipeline to get Alberta oil to world markets besides the U.S. for the first time.

Trudeau committed tens of billions of dollars to effectively save the Canadian auto sector by transforming it into one of the world’s most comprehensive electric vehicle (EV) supply chains.

He invested to build up Montreal’s world-class aerospace industry.

Trudeau has subsidized startups and established firms alike in commercial applications of artificial intelligence (AI), advanced telecommunications research and production, modular housing, and Canada’s first new vaccine plant in about 40 years.

To date, the Trudeau government has committed about $51 billion to providing more housing.

Trudeau came to office promising to reduce the poverty rate. It now nine per cent, down from 14.5 per cent when he first took office.

That improvement in Canadian well-being has been achieved in large part by Trudeau’s Canada Child Benefit, which has lifted as many as half a million children from poverty.

Trudeau’s national daycare program has also helped, reducing monthly daycare expenses to $400 from about $2,000, dropping further to about $200 in the next two years.

Also helping is the Trudeau government’s introduction of limited denticare and pharmacare, a foundation for future governments to build on.

But somewhere along the way Trudeau became so off-putting that even the more remarkable of his government’s achievements failed to register with Canadians.

There were blunders and scandals, of course. There was the carbon tax fiasco. And the federal civil service became bloated even as work was outsourced to high-priced consultants.

The greatest damage to the Liberal brand was inflicted by the we-know-best arrogance that has long been a hallmark of Trudeau’s party.

None of which changes the fact that on average Canadians are better off than we were in 2015.

In a moment of frustration, Trudeau said, “At one point, people are going to have to realize that maybe I know what I’m doing.”

Well, no they don’t.

But the historians will.

https://www.thestar.com/business/say-what-you-want-about-justin-trudeau-theres-still-no-arguing-canadians-became-wealthier-while/article_bd6afbaa-cc3c-11ef-8a5a-b7468842b9a6.html?source=newsletter&utm_content=a06&utm_source=ts_nl&utm_medium=email&utm_email=0C810E7AE4E7C3CEB3816076F6F9881B&utm_campaign=top_7503

Tags: budget, economy, featured, ideology, poverty, standard of living

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