GD's Political Animal

Thursday, July 10, 2025

Carney gov't scrambles for savings for fall budget

Mark Carney's Finance Minister has directed cabinet members to find billions of dollars in savings before this fall's federal budget.

Finance minister directs cabinet colleagues to find billions in spending cuts | National Post | Antoine Trépanier:

July 7, 2025 - "Canada’s Finance Minister François-Philippe Champagne has directed his cabinet colleagues to find ways to cut spending by billions of dollars as he prepares to present his first budget in October. In two letters sent Monday to all his cabinet colleagues — including secretaries of state who sit outside cabinet as junior ministers — Champagne stated his intention to reduce program spending by 7.5 per cent for the 2026–27 fiscal year, by 10 per cent in the second year, and 15 per cent in 2028–29. National Post did not see the confidential letters, but several high-ranking sources confirmed their contents, as initially reported by La Presse.

“'As part of this ambitious review, each minister must examine the programs and activities in their portfolio to determine which (of them): achieve their objectives, are essential to the federal mandate and complement rather than duplicate what is offered elsewhere by the federal government or by other levels of government,' the letter states, a senior government source said. Champagne also asked ministers for 'three priority proposals that can be funded by the reallocation of existing funds, following a spending review' by the end of the summer. Liberal government insiders indicated that a first wave of budget cuts could be felt in the next budget....

"This initiative is being led by the Department of Finance and the Treasury Board at the request of Carney, who often repeated 'invest more, spend less' throughout his recent federal election campaign. His goal is to reduce the operating budget, while setting increased spending apart in the capital budget.

"The Parliamentary Budget Officer projected early this year that the federal deficit would fall to $50.1 billion during this fiscal year.... However, Carney has made several big-ticket spending announcements since then, including an income tax cut, cutting GST on new homes and dramatically amping up defence spending. The C.D. Howe Institute projected last week that this year’s deficit could reach $92 billion."

How will Canada reach its new defence spending commitments? | Ottawa Citizen | David Pugliese • Ottawa Citizen

June 26, 2025 - "Canada has signed on to the NATO pledge to increase defence spending to 5 per cent of annual GDP by 2035. That means that Canadians at that point will be spending $150 billion annually on defence and security. The NATO plan involves investing 3.5 per cent of GDP into core military needs, which includes armaments and equipment. Another 1.5 per cent will be spent on related infrastructure, cyber defence and security....

"Prime Minister Mark Carney has said that Canada should have no problem reaching the 1.5 per cent infrastructure portion by concentrating on projects that are already under way or currently being planned. That would include the development of the mining and stockpiling of critical minerals, an initiative that could see Canada becoming a trusted supplier to western nations for such material....

"But Carney has also hinted at cuts coming in other areas to fund the military spending boost. 'If we are moving to the higher and higher levels of defence spending because that’s necessary then we will have to make considerations about what less the federal government can do, in certain cases, and how we’re going to pay for it,' Carney told journalists at the NATO conference.

"Parliamentary Budget Officer Yves Giroux has said he doesn’t have enough information to determine how the Carney government will meet its spending commitments. But shortly before the NATO meeting, Giroux told Bloomberg News that for Canada to finance the 5 per cent GDP defence hike it 'would require a major shift of government priorities — away from social spending, for example — to free up some of the resources currently allocated to these types of expenses towards defence.' The spending hike could also be financed by 'some tax increases, for sure, or much higher deficits,' Giroux added."

Friday, July 4, 2025

Canada's deficit could top $90 Billion this year

Canada's C.D. Howe Institute expects federal deficits to average $78 Billion over the next four years, more than double what the parliamentary budget officer forecast before the spring election.

Federal deficit could average $78B over 4 years, think tank warns | CityNews Toronto | Craig Lord, The Canadian Press, and Cormac MacSweeney:

July 3, 2025 - "The C.D. Howe Institute predicts Ottawa’s recently announced spending plans — which include a much bigger defence budget — will drive its deficits markedly higher in the coming years. In a new analysis released today, the think tank says it expects Canada’s deficit to top $92 billion this fiscal year, given Prime Minister Mark Carney’s plan to meet NATO’s defence spending target of two per cent of GDP.

"C.D. Howe says it expects deficit growth to slow after that but predicts deficits will still average around $78 billion annually over four years, more than double the level forecast by the parliamentary budget officer before the spring federal election. The Liberal government did not publish a spring budget this year and has said it will instead push the planned fiscal update to the fall.

"In addition to ramping up defence spending, Prime Minister Carney’s Liberals recently pushed forward legislation to accelerate major project development and delivered a one-percentage-point cut to the lowest income tax rate.

"The C.D. Howe Institute accuses Ottawa of making costly commitments without showing the numbers to Canadians."

BIG BUCKS LOST: Federal deficit numbers keep soaring with no end in relief | Toronto Sun | July 4, 2025:

Federal deficit projected to soar to $92B this year: 'Unfair to pass these burdens on,' C.D. Howe Institute says | National Post | Simon Tuck:

July 4, 2025 - ""If this fiscal year’s deficit turns out to be as hefty as projected, it would be the second-largest deficit in Canadian history, topped only by the $327.7 billion shortfall from the pandemic year of 2020-21....

"Based on the most current and largely optimistic variables, the report says, federal deficits will remain above $71 billion during each of the following three years and in the fiscal year 2028-29 will be greater than three times what the government itself forecast in its most recent federal budget. But more likely, the report says, it will likely be a bit worse than that because the report’s authors say that they’re skeptical that all of the government’s plans to increase revenue through promised higher fines, penalties and savings will actually occur....

"But the most recent federal budget was now well over a year ago. The government took the highly unusual step this year of waiting until the fall to release its annual budget, more than half-way through the fiscal year.... The C.D. Howe report criticizes the government’s decision to wait until the fiscal year is more than half over before releasing its budget 'Delaying a budget until the fiscal year is more than half over is never good, but Canada’s current high-spending trajectory makes this delay especially bad.'

"Ottawa is making costly commitments, the report explains, without showing key numbers to the public such as how much more tax it expects to gather, the extent of its new spending and what the increased debt will mean for interest payments.... C.D. Howe suggests that the Liberal government eliminate or forgo some of its costly platform promises, make deeper cuts in its operating spending, substitute some revenue from less harmful taxation such as the GST, and cut federal transfers to provinces and territories."

Wednesday, July 2, 2025

Military-industrial complex gets a big beautiful bill

Donald Trump's Big Beautiful Bill will add at least $150 Billion to U.S. military spending.

A Big Beautiful Bill for the Military-Industrial Complex | Ron Paul Institute | Ron Paul:

June 30, 2025 - "The US Senate worked through the weekend on the 'Big Beautiful Bill' {BBB]. The goal was to pass it quickly to ensure the House will then pass it and send it to President Trump’s desk before the July 4th holiday....

"The House version of the BBB added 150 billion dollars to the Pentagon’s already bloated budget. The Senate bill gave the military-industrial complex 156 billion dollars. Increasing military spending contradicts President Trump’s promise to stop wasting money on endless wars that have nothing to do with ensuring the security of the American people.

"Some of the BBB’s military spending will be used to put troops on the border. I support strengthening border security. However, I do not support using the military for domestic law enforcement, which includes enforcing immigration laws. Soldiers are trained to view people as potential enemies, not as innocent civilians to be protected. Introducing this mindset into domestic law enforcement will lead to abuses of liberty.

"Increasing spending on militarism while cutting spending on programs that help low-income Americans is bad politics and bad policy. Polls show that the majority of Americans, including many Republicans, do not support overseas intervention.

"The growing opposition to our hyper-interventionist foreign policy is easy to understand. The US has engaged in numerous military actions in many countries including Iraq, Afghanistan, and Syria since the beginning of the 21st century. The American people pay for this militarism in several ways. One is the “inflation tax” imposed by the Federal Reserve in order to monetize the debt incurred by the US government for endless wars. President Trump has turned his back on his antiwar supporters by bombing Iran and by increasing military spending to over a trillion dollars.

"The Republican insistence on increasing military spending is the main reason Congress cannot cut taxes without increasing the debt, making cuts in domestic welfare programs, or both. If the Republicans want to be the Make America Great Again party, they need to embrace a true America First foreign policy. This means no more regime change wars or US taxpayer supported 'color revolutions.' Instead, America should return to the Founders’ vision of a country that, in the words of John Quincy Adams, does not go 'abroad in search of monsters to destroy' and instead is 'the well-wisher to the freedom and independence of all' while 'the champion and vindicator only of her own.'

"A return to a noninterventionist foreign policy is the only way we will be able to begin to pay down the national debt and restore a government that adheres to the constitutional limits on its powers and respects all the people’s rights all the time."

Tuesday, July 1, 2025

Canadian gov't rescinds Digital Services Tax

Happy Canada Day! The Canadian government has rescinded its Digital Services Tax, one day before it was to go into effect.

Canada Rescinds Digital Services Tax After Trump Halts Trade Talks | Epoch Times | Omid Ghoreishi:

June 30, 2025 - "The Canadian government is rescinding its digital services tax to avoid stalling trade talks with the United States, two days after U.S. President Donald Trump announced he would end negotiations over the levy. Ottawa says that removing the tax will put Canada back on track to reach a trade deal with the United States by July 21.

"Trump said on June 27 that he is ending all trade negotiations with Canada over Canada’s digital services tax (DST), which would impact U.S.-based tech companies such as Amazon, Google, and Netflix.... The DST imposed a 3 percent tax on revenue that tech companies earn from digital services provided to Canadian users. It was scheduled to go into effect on June 30, and was retroactive to 2022, leaving U.S. tech companies with a $2 billion bill to pay by the end of June. The Canadian tax had been an irritant to both the Biden and Trump administrations....

"The Trump administration has already imposed 25 percent tariffs on Canadian products, though goods falling under the U.S.–Mexico–Canada Agreement have been exempted. Washington has also imposed blanket tariffs on all steel and aluminum imports.... Ottawa has been seeking new trade negotiations with the United States to minimize U.S. tariffs. In announcing the removal of the DST, Canadian Minister of Finance François-Philippe Champagne said the move would allow trade negotiations with the United States to go forward....

"Champagne had insisted up until recently that Ottawa wouldn’t be putting the tax on hold, after pressure from Canadian and U.S. business groups as well as U.S. politicians to remove the tax. Canada’s Liberal government had said that the tax is in line with similar measures from a number of other countries, and that corporations should pay their 'fair share' of taxes in Canada.

The Office of the Parliamentary Budget Officer estimated that the tax would bring in $7.2 billion over five years in revenue for Ottawa."

NO NETFLIX TAX - But Carbon Tariff is NEXT! | Canadian Taxpayers Federation | June 30, 2025:

Saturday, June 28, 2025

Digital Services Tax derails trade talks with USA

The U.S. government abruptly broke off trade negotiations with Canada after the Carney government announced it was going forward with its Digital Services Tax, aimed at U.S. companies who operate online in Canada.

What is Canada's digital services tax and why is it infuriating Trump? | Financial Post | Yvonne Lau:

June 27, 2025 - "U.S. President Donald Trump abruptly cut off all trade negotiations with Canada on Friday, citing Ottawa’s Digital Services Tax (DST) for the decision. The tax, enacted last June, targets U.S. technology companies that operate in Canada but pay little tax here. Under the new tax regime, the first payments are set to be collected on Monday, June 30....

"Former Prime Minister Justin Trudeau’s government enacted Canada’s Digital Services Tax Act in June 2024.... The federal tax is applicable to large businesses — both foreign and domestic — that meet two specific criteria: a total global revenue of €750 million and up, and over $20 million of profits earned in Canada annually. The legislation levies a three per cent tax on digital services revenue over $20 million, and is retroactive to Jan. 1, 2022.... Taxable revenue includes those of online marketplaces, digital advertising, social media, and user data — which will primarily affect American Big Tech giants such as Amazon.com, Inc., Apple Inc., and Meta Platforms, Inc.

"Under the DST, companies were required to register with the Canada Revenue Agency (CRA) by Jan. 31, 2025 and are obligated to file their first DST returns on June 30, 2025. The CRA has said that more than 500 companies have already applied to register for DST purposes, and expects more than 100 companies to pay the tax. If applicable companies fail to register with the agency, they could be fined $20,000 per year. If they fail to file a DST return, Canada could dole out a penalty equal to five per cent of the unpaid tax for the year, plus one per cent of the unpaid tax for the year for each month, not exceeding 12 months, in which the return hasn’t been filed....

"The legislation however, has come under fire from business groups on both sides of the border, with critics warning that the rules could further inflame Canada-U.S. ties. The Canadian Chamber of Commerce has argued that the tax could increase costs for consumers and risks 'damaging our beneficial and lucrative trade relationship with the U.S.' The U.S. meanwhile, has long denounced Canada’s proposed rules, claiming that they unfairly discriminate against American firms. Last August, under the former Biden administration, the Office of the U.S. Trade Representative (USTR) launched dispute settlement consultations with Ottawa under the Canada-United States-Mexico Agreement over the DST....

"Tech giant Google LLC responded to Canada’s digital services tax rules by introducing an additional 2.5 per cent fee for ads shown in Canada starting in October 2024. Called the 'Canada DST Fee,' Google said the surcharges will “cover part of the costs of complying with DST legislation in Canada'....

"Around half of all European OECD countries have announced, proposed, or implemented a DST, according to the Tax Foundation Europe. The U.S. has met those proposals with threats of retaliatory tariffs. Some countries’ DST regimes could be on the chopping block. France’s Council of State, which advises the government on the preparation of bills and other matters, recently referred the country’s DST to the Constitutional Council for review, marking the first constitutional challenge to the DST since the legislation passed in 2019.

"For months, executives of U.S. tech giants have pressured American policymakers over Canada’s DST. Ontario Premier Doug Ford and Canadian business groups have also pressed the Carney government to abandon the DST. And while businesses and industry groups were holding out for a last-minute suspension of the DST, finance minister François-Philippe Champagne reconfirmed last Thursday that Canada is 'going ahead' with the tax. 'The (DST) is in force and it’s going to be applied,” he said.... 'Obviously, all of that is something that we’re considering as part of broader discussions that you may have,' Champagne said last week, suggesting that the DST could be renegotiated given the ongoing trade talks between Canada and the U.S."

What is Canada’s digital services tax, and who pays it? | CBC News: The National | June 27, 2025:

Friday, June 27, 2025

U.S.-Iran war averted for now

War between the U.S. and Iran did not happen this week. However, it is not yet off the table.

President Trump: End the War Now! | Ron Paul Institute | Ron Paul:

June 23, 2025 - "Just a few weeks ago in this space I urged President Trump to accept a deal with Iran allowing it to continue pursuing civilian nuclear power while ensuring that it would not pursue nuclear weapons. Iran signaled it was ready to sign such a deal, yet suddenly Trump’s special envoy Steve Witkoff changed the US position to demand no civilian nuclear enrichment at all. The US Administration understood that Iran could not accept such a demand – that it had that right as a signatory of the Non-Proliferation Treaty – but Witkoff shifted the position anyway.

"Just days before the sixth round of negotiations were to take place, Israel blew up the whole process by launching a surprise attack on Iran and here we are just over a week later staring right into the face of World War III. Had the 'bait and switch' and subsequent Israeli attack not taken place, we likely would be seeing rapidly improving trade relations with Iran and throughout the region that would have enriched all parties....

"But the neocons and ... Benjamin Netanyahu, couldn’t stand the prospect of peace breaking out in the region so they dusted off their old lies about 'weapons of mass destruction' from the lead up to the Iraq war and soon enough the talks were sunk beneath a barrage of Israeli – and as of this past weekend American – bombs and missiles.

"President Trump’s decision to spend untold billions of dollars on what appears to be not much more than a 'symbolic' bombing of Iran’s already-vacated nuclear facilities was no doubt made with the intention of making himself look tough. Unfortunately for him, it has had the opposite effect. He has shown the world that he was no more able to resist the demands of the neocons and warmongers than his predecessors, and in abandoning his promises to be the president that ends wars instead of starting new ones he has also abandoned the most enthusiastic part of his base.

"What President Trump does not seem to understand is that true strength is not measured in how many missiles you can send to the 'Hitler of the month' as designated by the warmongers. True strength comes from standing up for your stated principles in the face of the enormous pressure that will inevitably be placed on you. Real strength is strength of character. It often comes from the ability to say 'no' when everyone around you demands that you give up a little bit of your principles for promises of riches or glory.

"As of this writing, we are standing on the precipice of a major war in the Middle East that threatens to bring in much larger actors such as Russia and China. The neocons, filled with unwarranted vainglory, welcome such a clash because they won’t be doing the fighting and dying. They will be the ones reaping the financial and other rewards. As usual.

"Unfortunately, President Trump has severely damaged his credibility by embroiling us in a war that is not our war. He would do well to immediately change course, search for off-ramps, make peace with Iran, and once and for all banish all neocons and warmongers from anywhere near his Administration. Otherwise 'MAGA' will go down in history as nothing but a cruel joke."

Sunday, June 22, 2025

Justice Centre report tallies up lockdown costs

A new report from the Justice Centre for Constitutional Freedoms examines the immediate and long-term negative impacts of Canada's Covid lockdowns, including physical, social, and economic harms.

New Report – Five years on: Tracing the costs of lockdowns } Justice Centre for Constitutional Freedoms (news release):

May 8, 2025 - "A new report from the Justice Centre for Constitutional Freedoms examines the immediate and long-term negative impacts of Covid lockdowns, including physical, social, and economic harms. It also underscores the lack of transparent, evidence-based analysis by governments to justify these measures....

"One of the most concerning findings is the sharp decline in Canadians’ mental health. In 2019, 67 percent of Canadians rated their mental health as 'very good or excellent.' By 2023, that figure had dropped to just 54 percent. Meanwhile, the number of Canadians reporting 'fair or poor' mental health nearly doubled — from 8 percent to 15 percent. This trend was seen across all age groups, but especially among young adults.

"Indeed, despite facing minimal risk from Covid, young Canadians suffered some of the most serious consequences of lockdown measures. Non-Covid deaths among Canadians under age 45 rose by 22 percent, driven by factors such as disease, addiction, delayed treatment, and suicide. Physical activity among youth dropped significantly during this period, while time spent on screens—such as cell phones, computers, and tablets—increased sharply. Up to 70 percent of children and teens reported experiencing anxiety, depression, or other serious mental health issues.

"A particularly alarming trend was the surge in opioid-related deaths. From 2020 to 2023, annual opioid overdose deaths increased by 108 percent. In 2023 alone, 8,606 Canadians died from opioid toxicity—more than double the pre-lockdown average. British Columbia, Alberta, and Ontario recorded the highest rates, with the vast majority of deaths involving fentanyl.

"During Covid, thousands of medical check-ups, diagnoses, and treatments were delayed or cancelled, resulting in a serious and ongoing backlog in Canada’s healthcare system.

"Wait times for medical treatments increased by 43 percent between 2019 and 2024, reaching a median of 30 weeks. MRI wait times rose by 55 percent. For certain cancers, including breast and prostate, surgery delays increased by as much as 34 percent. Since 2018, more than 74,000 Canadians have died while waiting for surgery or diagnostic care—over 15,000 of them in 2023–24 alone. The actual number is likely higher, due to poor provincial tracking and reporting....

"Lockdowns resulted in widespread job losses, particularly among low-wage workers, while the 'laptop class' remained largely unscathed. While many public sector jobs expanded during this time, Canadians in hospitality, retail, and service sectors faced prolonged unemployment. The expansion of public spending and government debt contributed to rising inflation, driving up the cost of food, housing, and other essentials.

"Crime rates also rose during the lockdown years. Homicides peaked in 2022 at 17 percent above trend, with 882 victims across Canada. Cybercrime nearly doubled, rising from 48,000 cases in 2019 to over 93,000 in 2023. Identity theft and fraud increased to 120 percent above trend in 2020, with similar levels in the following years. Particularly troubling was the rise in online child sexual exploitation, which reached 18,650 reported cases in 2023—a 173 percent increase from 2019.

"Benjamin Klassen, Education Coordinator at the Justice Centre, says the findings demand accountability.

This report calls for governments to take responsibility for the damage done during this period and ensure that future public health policies uphold the Charter rights and freedoms of all Canadians....
The Charter requires governments to ‘demonstrably’ justify any freedom-limiting policy. To date, no federal or provincial government in Canada has conducted the kind of comprehensive impact assessment required to justify the lockdowns....
The evidence is clear: the harms of lockdowns outweighed their benefits. Canadians deserve an honest and transparent evaluation of lockdown harms, so that these mistakes are never repeated."

Read study: https://www.jccf.ca/wp-content/uploads/2025/05/Five-years-on-Tracing-the-costs-of-lockdowns-1.pdf

Pages