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| Justin Trudeau projected to be the largest debt accumulator in Canada's history: Fraser Institute |
Excluding Prime Ministers who served during a world war or a major economic downturn, Justin Trudeau is projected to go down as the biggest debt accumulating Prime Minister Canada has ever seen.
A new report from the Fraser Institute detailing federal spending by Prime Ministers shows that Justin Trudeau is projected to raise the federal debt per person by 5.6% by the end of his first term. Sir Mackenzie Bowell and Sir John Abbott are the only other Prime Ministers to have increased the federal debt without facing an economic downturn or global conflict.
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Fraser Institute Report: Prime Ministers and Federal Debt, 2019.
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While the debt has skyrocketed since the 1980’s, a concerted effort by the Chretien, Martin and early Harper governments brought the debt down during the late 1990’s and early 2000’s. However, since the Great Recession in 2008, the debt has continued to climb.
The report’s authors focuses in on the debt per person metric because they deem it to be the most accurate way to measure government spending across time. While the Trudeau government often defends its fiscal record citing the debt to GDP ratio, the authors offer an explanation as to why that metric isn’t so reliable.
To focus on changes in the debt-to-GDP ratio would therefore penalize prime ministers who served during recessions and would benefit, by happenstance, prime ministers who served during periods of economic expansions. When recessions occur, the debt-to-GDP ratio tends to rise due to automatic increases in government spending (e.g., employment insurance), any stimulus spending, and the decrease in economic output. Conversely, prime ministers who preside over strongly positive economic growth may be more likely to record falling debt-to-GDP ratios.
Fraser Institute Report: Prime Ministers and Federal Debt, 2019.
Source: Lucas Holtvluwer | The Post Millennial
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