This week, it was revealed that Canadian household debt has reached $2.5 trillion. That is 103% of GDP and the highest level in the G7. It is also the second-highest in the OECD, the organization of the world's 38 richest countries. Only Switzerland, at 128%, is higher.
Comparable countries are significantly lower. The United Kingdom has 81% personal indebtedness, the United States 71%, and Japan, which has been trapped in a debt spiral for nearly two decades, sits at 68%.
Of course, it is not just ordinary Canadians who are buried in debt. The federal and provincial governments are also consumed. Together, they too are carrying debt of around 100% of GDP.
Ottawa is the worst, with $1.4 trillion in national debt, a doubling since the Liberals came to office in 2015. But together Ontario and Quebec are not far behind, at $500 billion and $300 billion, respectively. Ontario remains, as it has been for nearly 20 years, the most heavily indebted sub-national government in the world. Among provinces, states, and territories, only California comes close, and it has more than twice Ontario's population.
All that debt, both household and government, keeps interest rates high and smothers investment and expansion of businesses. Yet no government in Canada seems in a hurry to curb its spending.
After promising last spring to never again post a federal budget deficit as large as Prime Minister Justin Trudeau's, new Liberal Prime Minister Mark Carney ran up the largest deficit in Canadian history, nearly $79 billion, almost $20 billion larger than the last Trudeau deficit. And last year's $78.9-billion shortfall is to be followed by deficits greater than $70 billion for at least the next four years.
But not only have the Carney Liberals failed to stop piling up debt, they have done almost nothing to revive the economy. They set up a major projects office and spent millions on expensive television ads promising to build big again. Yet that has amounted to nothing so far.
Canada also has the worst grocery inflation in the developed world, the least affordable housing, and the slowest growing economy. According to the OECD, Canada is 38th of 38 in growth, which is expected to be well under one percent this year.
Youth employment remains stubbornly around 15%. Try finding a summer job to finance your education.
This is not only the fault of our slow-growing economy. In sluggish times, young people are the last to be hired. It is also the fault of foolish federal immigration policy that flooded the labour market with foreign students and temporary workers, nearly 2 million of them. And while the feds have put some caps on these categories of immigration, there is no way to ensure these people leave when their visas expire. Most do not.
