The Liberals radical far-left shift puts them outside the Canadian mainstream, and risks doing devastating damage to our already severely weakened economy.
Justin Trudeau’s embrace of radical far-left economic policies isn’t going unnoticed.
Fitch Ratings, who already downgraded Canada from AAA to AA+ over rising debt fears, has issued a new warning.
In their latest note on Canada, they point out that our government debt to GDP ratio is surpassing the ratio in many countries with an AA rating:
“Significant fiscal deterioration in 2020 was a key factor in Canada’s downgrade to ‘AA+’/Stable in June and the latest announcements point to continued risks of further deficit widening. These measures, and the federal government’s CAD343 billion estimate of the upsized fiscal 2020/2021 deficit announced in the July fiscal snapshot point to a general government deficit above 21% of GDP in 2020, wider than our 16.1% of GDP estimate at the time of the downgrade. The gross general government debt to GDP ratio will rise above 120% of GDP, significantly higher than the ‘AA’ median.”
There is also this warning:
“Failure to place consolidated gross general government debt/GDP on a downward path over the medium term could lead to negative rating action.”
Basically, Fitch is making it clear that endlessly rising spending combined with a weak economy rising debt to GDP levels is a serious problem, something that we already know through simple common sense.
As I wrote earlier, this would be bad enough under a government pursuing realistic policies, but is far more dangerous under the radical left shift the Liberals are making:
“It appears the Liberals will be spending record amounts of money, while simultaneously embracing radical far-left ‘green’ ideas, which will make everything more expensive, and destroy good secure jobs in the energy sector, while crippling Canadian manufacturing and preventing the resurgence of Made in Canada products that is so necessary for our economic and national security.
Trudeau’s policies will also likely trigger further credit rating downgrades, and this is where the personal debt crisis could be launched.
At some point, interest rates will go up, and with Canada losing fiscal credibility, that is becoming more and more likely.”
This is a very dangerous moment for our country.
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