Part 4: Conservative Economic rhetoric is Gaslighting

Andrew Scheer goes on and on about forcing the Federal Government to “live within its means” and that invokes old discredited fears about Canada’s accumulating debt and our deficits. Scheer claims PM Justin Trudeau made a “mess” of our economy & his “massive” deficits will mean increased taxes that our children will inherit.

Conservative fear-mongering about Canada’s best debt-to-GDP-ratio in the G7 is gaslighting. Our children also inherit massive assets and like any mortgage they may pay on for 20-30 yrs, increased equity in ownership is a huge bonus.

Comparing household budgets (live within our means) to Canada’s economy and current debt without mentioning our declining debt-to-GDP-ratio, demonstrates CPC’s rank immaturity and deep ignorance about modern economics – according to economists pre-Covid, the budget was on track to balance itself.

How the International Monetary Fund (IMF) views Canada’s economy – a “mess” according to Scheer

1. Over the past five years, Canada has employed a judicious mix of policies to support inclusive growth and reduce vulnerabilities in the financial system. The use of fiscal space combined with accommodative monetary policy at the onset of the 2014 oil price shock was effective in overcoming the recession in 2015. The economy posted the strongest growth rate among G7 economies in 2017 and the unemployment rate fell to its lowest level in forty years.”

I took the liberty of adding Canada’s PMs (excluded short term PMs)
to one of Kevin Milligan’s original graphs on Federal Debt share of GDP.

Kevin Milligan weighs in on Andrew Scheer’s fear-mongering about the Liberals’ “massive” deficits

EXCERPTS: “… debt servicing costs are very likely to come in under budget.”

Did Liberals increase debt:
“It’s almost impossible to see any bump in the debt.”

Will Liberal deficits lead to tax increases as Andrew Scheer claims?

“No.” !!!! “Why? Because the existing tax structure raises revenue on new GDP as the economy grows. This increase is larger than the interest on new debt, when deficits are small (like now).

…so, on current policy, our economy is on the path to zero debt according to the @PBO_DPB.” Kevin Milligan, Economist

Compare LPC to CPC promises on income tax cuts mentioned on the campaign trail.

According to Trevor Tombe, both are similar but the LIB proposal is more progressive. The full analysis is at Kevin Milligan’s blog.

More info on Tombe’s Twitter thread

Kevin Milligan analyzes the Liberal proposal to increase the basic personal amounts at tax time

Milligan estimates that the LPC proposal will ” lift 38,000 Canadians above the poverty line.”

See Milligan’s HTML Twitter thread

The International Monetary Fund (IMF)

ECONOMIC blog posts:

Part 1 Conservative Economics Gutting Fiscal Capacity
Part 2 Conservative Economics
Part 3 UCP Economics Alberta
Conservative’s magical thinking on economics has it’s roots in Neoliberalism: Socialism for the Wealthy