Modern Canadian budgets have become little more than an opportunity for the government to sell Canadians on how great a job it is doing. But the Carney Liberals’ spring economic update, which was tabled on Tuesday, is so gravity-defying, it might as well have been lifted from a “Star Trek” script.
A Tale of Two Engineers
In an episode of “Star Trek: The Next Generation,” Geordi La Forge, the Enterprise’s chief engineer, finds himself in conversation with his predecessor, Montgomery (Scotty) Scott. “I told the captain I’d have this analysis done in an hour,” says La Forge. “How long will it really take?” asks Scotty. “An hour,” replies La Forge, indignantly. “Oh, you didn’t tell him how long it would really take, did ya?” asks Scotty. “Oh, laddie, you’ve got a lot to learn if you want people to think of you as a miracle worker.” Scotty was well known for multiplying his repair estimates by a factor of four, yet always managed to complete them in time to save the ship.
Gaslighting Canadians
The Carney Liberals seem to have taken his “miracle worker” lesson to heart, only instead of saving the ship, they’re gaslighting Canadians about how much water it’s taking on. Even before the economic statement was released, Prime Minister Mark Carney was hinting at a better-than-expected deficit figure, which he chalked up to his party being “good fiscal managers.” At a press conference on Tuesday, Finance Minister François-Philippe Champagne declared that, “Today, we’re restoring fiscal discipline.” In the fiscal update, he claimed that, “In our first budget, we made responsible choices to reduce spending to save Canadian taxpayers $60 billion over five years.” And when tabling his mini-budget in the House, he bragged that his government has reduced “our projected deficit for 2025-26 by more than $11 billion.”
The Reality Behind the Numbers
This is the talking point that was regurgitated by much of the media. But it’s misleading, at best. It’s true that, thanks to increased tax revenue and an economy that’s performing better than expected, the $78.3-billion deficit predicted in budget 2025 was reduced to $60.6 billion. That’s still far higher than the deficits former prime minister Justin Trudeau was running at the end of his tenure, but it’s also lower than it would have been if Carney was capable of showing even a modicum of fiscal restraint.
Rather than taking the slightly reduced deficit figure as a win, the government announced $37.5 billion in new spending over the next six years on Tuesday, meaning that the 2025-26 deficit will clock in at around $66.9 billion, rather than $60.6 billion. For those keeping track, Ottawa has now announced $54 billion in new spending over the next six years since last year’s budget was tabled in November. Nor does the government plan to return to balance in the foreseeable future: the spring economic statement predicts that Ottawa will still be running a $56-billion deficit by the end of the decade, up from an estimated $20 billion in budget 2024.
The Carney Liberals’ fiscal update denies reality and gravity, all while claiming to save the whales. But Canadians should see through the smoke and mirrors.
