During an election campaign, the leaders of political parties make many promises to voters. These promises give the electorate the hope of a brighter future. The problem with political promises is they are often not worth the paper they are written on. To win an election, politicians will promise more than they can deliver.
Trudeau promised a balanced budget by 2020
Case in point: In the 2015 federal election, Justin Trudeau said a Liberal government would run three years of deficits totaling $25.1 billion, and then balance the budget in the 2019-20 fiscal year. The Liberal fiscal plan set Trudeau apart from Tom Mulcair, the NDP leader, who promised four years of balanced budgets. After Mulcair's announcement, Trudeau told his wife Sophie Grégoire, "I'm pretty sure we just won the election." Trudeau believed his plan to run “short-term deficits” in order to “invest” in infrastructure made the Liberals more attractive to voters than the NDP. As a young and inexperienced politician, his plan also made him appear fiscally responsible, that he wouldn’t repeat the mistakes of his father Pierre and run massive deficits indefinitely. Trudeau’s election prediction came true. The Liberal platform appealed to millions of Canadians, and he won a majority government.
Harper's prediction was right, Trudeau won't balance the budget
However, there was another prediction that also came true. During the election, Stephen Harper made fun of Trudeau’s short-term deficit plan. Harper knew that just like the Ontario Liberals, Trudeau would never balance the budget. Harper was proven right. When the Trudeau government tabled its first budget in 2016, they projected a budget deficit in 2019-20. Here are the most up-to-date numbers: Fiscal YearDeficit2016-201719 billion2017-201819 billion2018-2019 (Projected)18.1 billion2019-2020 (Projected)19.6 billionTotal Deficits75.7 billionThe reason Trudeau broke his balanced budget promise is the Liberal fiscal plan never added up. The Liberal plan included $146.5 billion in new spending and tax cuts. Here are some of those promises:
- A new Canada Child Benefit for families
- A 1.5 percent reduction in the income tax bracket for the middle class
- $300 million dollars in new funding for youth employment
- A 10 percent increase in the Guaranteed Income Supplement for single low-income seniors
- The creation of 40,000 government-funded youth jobs
- $125 million for extended parental benefits
- $125 million in tax incentives for rental housing
- Increased funding for student grants and post-secondary education
- An additional $775 million per year for job and skills training
- Three billion dollars for home care services
- Tens of billions of dollars in new infrastructure spending
If Trudeau ran deficits of less than $10 billion each year, he would not have been able to keep the other spending promises he made. Hence, he abandoned his plan to balance the budget, so he could keep his spending plans intact.
No plan to balance the budget until after 2050
What’s more, the Liberals currently have no plan to balance the budget until after 2050, and their annual deficits are mostly just to pay the interest on the debt. In the 2017-18 fiscal year, the federal government paid 21.9 billion in interest while running a deficit of 19 billion. Borrowing money just to pay the interest means ever increasing debt. It is the path to economic disaster. By increasing Canada’s debt in a period of economic prosperity, Justin Trudeau is a fiscally irresponsible Prime Minister. If interest rates keep rising, or if Canada suffers a recession, the annual deficits will be even greater, and may require severe austerity measures. In an interview with CTV News, Trudeau said one of his most important personal value is “openness and trust… that you say what you mean, you mean what you say...” Unfortunately, he does not live by his own values. Trudeau did not mean what he said when he promised to balance the budget in 2019-20. (You can’t promise 146.5 billion in new spending and tax cuts and balance the budget. It is mathematically impossible.) Justin Trudeau deceived voters during the 2015 election, and he should apologize to Canadians. The Liberal fiscal plan was a fraud.