Is it Justin or Pierre? Increasing taxes.
Skyrocketing government debt.
Expanding regulations, soaring inflation, and rising interest rates.
You may think I’m describing Canada today.
But I’m actually describing Pierre Trudeau’s tenure as prime minister in the 1970s and 80s, which eventually culminated in a near crisis.
Unfortunately for us in the 2020s, Justin Trudeau is repeating his father’s mistakes.
For starters, both Trudeaus engage in deficit-financed spending.
Pierre Trudeau nearly doubled per-person spending between 1967 and 1984 , recording a budget deficit every year excluding a small surplus in 1969-70. Total federal debt increased by 167% during his time in office!
Similarly, Justin Trudeau has expanded the scope and role of the federal government, while also drastically increasing per-person spending to the second highest level on record – even after excluding COVID-related measures! Like his father, Justin Trudeau has recorded a deficit every year since taking office while total federal debt has increased 51% on his watch.
In both these cases, the higher spending and printing of money led to increasing rates of inflation. For Pierre Trudeau, inflation reached more than 12% by 1981. Under Justin Trudeau, inflation has surged to 8.1%, the largest year-over-year increase since… his father’s government.
The similarities, sadly, don’t end there.
Both Trudeaus introduced changes that hamper Canada’s investment climate and competitiveness.
In 1972, Pierre Trudeau introduced a tax on capital gains, which are found to be among the most economically damaging taxes. Similarly, Justin Trudeau raised the top marginal income tax rate on entrepreneurs, professionals and business owners, with more economically damaging tax hikes on the horizon.
And both Trudeaus made a concerted effort to curtail the western-based oil and gas sector, heightening regional tensions.
Pierre Trudeau introduced the National Energy Program, which taxed more profits from the sector, creating animosity and distrust of Ottawa, particularly in Alberta.
Justin Trudeau introduced a national carbon tax, a cap on greenhouse gas emissions that only applies to the oil and gas sector, and other regulations that further constrain energy development. These policies have sparked significant animosity in the West, to the point that a “Fair Deal Panel” was appointed to review Alberta’s role in the federation!
The last decade or so of Pierre Trudeau’s reign as prime minister was defined by high inflation, slower real economic growth and heightened regional tensions.
Today, Justin Trudeau’s similar policies are producing the same results.
Gary, all of the above facts and numbers are found in recent Fraser Institute studies.