When governments attack true growth and productivity, and impose increasingly onerous taxes on Citizens, this is the result.
Many Canadians are taking on more debt, in an attempt to keep up with the rapidly escalating cost-of-living.
According to a survey of over 1,000 Canadians conducted by finder.com, 24% of Canadians say they have “taken on more debt to pay for living costs” such as food, gas, and housing.
As noted by finder.com, “That means approximately 7.3 million Canadians over the age of 18 used loans or other forms of debt to cover the gap between their earnings and the rising cost of living.”
And that’s not all.
In a sign of how inflation is hitting a massive percentage of the country, 43% said they are already spending less on “travel or large ticket items,” and a majority (59%), say they are “spending less on personal extras” such as “clothing, entertainment, and restaurants.”
One person’s spending is another person’s income
When someone spends less, someone else is getting less income. This is why prolonged high inflation leads to economic downturns.
Governments use this to justify pouring money into the economy and expanding government payrolls. However, that is highly inefficient, and can only temporarily mask underlying problems.
What Canada needs is growth in the private sector, not the government sector.
For an economy to truly grow and prosper, productivity must increase. That is what generates more wealth, and drives the self-reinforcing cycle of growth.
By contrast, the big government approach has led to severe distortions, and is completely unsustainable.
On the one hand, the Liberal government increases taxes and restricts productivity growth, making Canadians poorer. On the other hand, they try to mask those policies by throwing money around.
As noted by CPC leadership frontrunner Pierre Poilievre, Canadians are paying the price for Justin Trudeau not thinking about monetary policy:
“Remember when Trudeau said gov would take on debt so you wouldn’t have to?
Now #Justinflation – caused by inflationary deficits – is forcing Canadians to borrow more just to live.
Turns out he really doesn’t think about monetary policy. He had no idea what he was talking about.”
Remember when Trudeau said gov would take on debt so you wouldn’t have to?
Now #Justinflation – caused by inflationary deficits – is forcing Canadians to borrow more just to live.
Turns out he really doesn't think about monetary policy. He had no idea what he was talking about. https://t.co/YeLmLejjRB
— Pierre Poilievre (@PierrePoilievre) August 18, 2022
Everyone except Justin Trudeau and his cronies know that more money in the system without a comparable increase in the number of available goods does nothing except reduce our purchasing power.
Thus, people are desperately trying to hold on to their standard of living, and going further and further into debt to do so.
This demonstrates the total unsustainability of Canada’s current economic policies, and is why both our Citizens and our country as a whole is falling further and further behind.
Spencer Fernando
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