Far from helping, the big-government inflationary agenda is robbing Canadians of our purchasing power.
Justin Trudeau has staked his political career on the idea that more government is always the solution.
Whatever the issue may be, spend more and things will improve.
At least, that’s what Trudeau thinks.
That message has often had appeal to many Canadians because it makes a certain intuitive sense.
After all, in our own lives we can often improve a situation by spending money to address it.
Unfortunately, when a government engages in rampant overspending, and when that spending is enabled by a central bank that prints an immense amount of money, ‘more money’ can lead to reduced purchasing power, as each unit of money is devalued and there is more money chasing fewer goods.
The point of no return
Inflationary policies often appear to be working for a while.
A rapid injection of money into the economy gives the appearance of rising wages, and many people see a bigger number in their bank account.
There can be a temporary surge of employment as well, since inflationary policies borrow economic growth from the future and bring it into the present.
But that’s not without a cost.
That cost is debasement of the currency, and a larger debt burden.
And sooner or later, the negatives outweigh the benefits.
We reach a point of no return, when inflationary policy has locked in so much economic distortion that there is no easy way out.
That brings us to where Canada is today.
After many years of pursuing inflationary policy – and repeatedly doubling down on that flawed way of thinking – the Liberal government and the Bank of Canada have created a situation in which millions of Canadians are falling further and further behind.
According to a report by RBC Economics, low income Canadians are getting hit the hardest by inflation and rising debt costs:
“A report by RBC Economics says inflation and rising borrowing costs will affect all Canadian households, but low income Canadians will feel the sharpest sting.
Economists at Royal Bank say a return of the overnight rate to two per cent will hike average Canadian household debt payments by nearly $2,000, or 15 per cent, next year.
But they say the debt service ratio of low income Canadians will rise at twice the speed of high income households through 2023.
On the inflation side, RBC estimates the lowest income Canadians will also be more affected as they spend a much larger share of their earnings on consumer purchases.
The economists also say low income households have a smaller cash cushion to deal with the rise in prices and borrowing costs.”
Big government makes things worse
The more the Liberal government tries to intervene in the economy, the worse things become for Canadians.
Our purchasing power is being eroded, the value of our labour is being robbed, and the dream of a prosperous lifestyle is being taken away from more and more of our fellow Citizens.
As long as the federal government continues to pursue inflationary policies, the more our country will suffer and stagnate.
Spencer Fernando
Photo – YouTube
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