The new federal Liberal government will table its first budget next week, with media reports suggesting a deficit triple the amount promised during the election campaign.
The TD forecast shows a persistent federal deficit of approximately $30 billion a year for the foreseeable future.
Per capita federal net debt (in 2015 dollars) grew from $577 in 1870 to $19,302 in 2015.
Once new major spending is factored in, the annual deficit is likely to be more than $25 billion.
Prime Minister Trudeau recently mused that not only will the $10 billion deficit ceiling be broken, but the return to a balanced budget by 2019/20 is now in question.
Today, newly minted federal Finance Minister Bill Morneau released his first Update of Economic and Fiscal Projections. Unfortunately, the outlook isn’t positive.
The policy direction of the Liberal Party of Canada and its leader Justin Trudeau, as evidenced by the speeches, motions, and debate at the recent national party convention seem to indicate that the party is rejecting the successful pragmatism of the 1990s. Instead, the federal Liberals favour a more interventionist and activist government, much like that of the current Ontario Liberal government. If such policies are enacted, the results would be ruinous for Canada.
On Wednesday, the day after delivering the 2014 federal budget, Finance Minister Jim Flaherty set off a firestorm by offering his view on income-splitting, a platform commitment the Conservatives made for when the government returns to a balanced budget (likely next year). I'm not sure that, overall, it [income-splitting] benefits our society, Minister Flaherty stated, preferring instead to, reduce taxes more.
While readers of this page will know we haven't always agreed with Minister Flaherty over the years, he is right on the money with respect to income-splitting.
"Some people will say this budget is boring," finance minister Jim Flaherty remarked after unveiling Tuesday's federal budget. A careful look, however, suggests the minister might be understating the future significance of his budget.
After running six consecutive deficits totaling $156.5 billion, Flaherty has been clear that balancing the budget in 2015-16 is his top priority. Budget 2014 reaffirms that commitment.