Dr. A.W. Barber is the former Director of Asian Studies at the University of Calgary. He is internationally active and has wide-ranging interests.Canadians are hurting this Christmas season. The London-based PwC reports findings from a mid-year survey that Canadians, in general, were planning to spend significantly less overall than last year on holidays. Gen Z, in particular, expects to cut holiday spending by 35%. Additionally, 45% of Canadians said they plan to shop more for used, upcycled, or resale items. Harris and Partners 2025 Christmas Spending Report informs us that 50% of households have not set aside money for the holidays as of the beginning of December, and 72% of Canadians are cutting back on spending. Homemade gifts and decorations, secret Santa exchanges, and holiday potluck meals are on the rise. Giving fewer gifts is also dampening the holiday spirit.According to Statistics Canada’s November 2025 Labour Force Survey, “There was little change in employment for core-aged people (25 to 54 years) and people aged 55 years and older.” Unemployment stood at 6.5%. This remains concerning amid cooling inflation (2.2% in November), as stagnant job growth in these groups signals labour market softness. Since 2023, the Canadian dollar has generally traded lower against the US dollar and the Euro.More Americans are planning to increase their spending this holiday shopping season. Black Friday 2025 broke spending records. According to Black Friday Statistics 2025, Americans spent $11.8 billion online at the start of the holiday shopping season. This represents an increase from 2024 and outperformed global Black Friday purchases, which also set a record, up 6.18% from 2024. This could have been Canada too..The US stock market posted significant gains overall in 2025. Recent tax changes under 2025 legislation provide relief with no tax on Social Security benefits, on tips, on overtime, along with enhanced child tax credits. Like in Canada, there was little change in the prime-age employment rate. However, the unemployment rate ticked up to 4.6% in November — partly due to mass federal employees layoffs and workers entering the job market. While prices for some consumer goods have decreased generally, monthly prices are up about 0.3%. Gasoline now averages $2.97 per gallon nationally, but excluding high-cost states like Hawaii, Alaska, and California brings the average below $2.85 per gallon. The reasons behind Canadians’ subdued holiday mood this year are obvious to many. Prices for many household items remain elevated after substantial increases under Trudeau, with some continuing to rise slowly. The federal carbon tax was never totally removed, but the government shifted the consumer noticeable portion to the hidden industrial carbon tax. Taxes and fees are generally considered too high to be competitive. Canada’s national debt continues to increase, regulations have not been significantly reduced, and ongoing structural problems remain a major drag on the economy. Canada has fallen in the OECD productivity rankings to eighteenth place, it has the highest household debt of the G7 countries, and investment in research and development continues to decline, remaining below the OECD average. .Without a doubt, a major factor is that Prime Minister Mark Carney has not secured significant progress in trade negotiations with the US. Indeed, both parties are not even talking. The mainstream media wants you to believe that all of Canada’s problems are due to tariffs imposed by President Trump. That simply is not the case. Imposing tariffs is a standard tool in international trade. Canada also applies tariffs — both currently and historically. President Trump shifted US tariff policy to promote fair trade over problematic free trade. The President has explained this, saying that the US will impose tariffs on foreign goods at the same rate as a foreign country imposes tariffs on US goods. This means that a mutual zero rate would lead to tariff-free trade.It might be tempting to assume that the Liberals believe Canadians cannot compete with the Americans. Rather, I think the Liberals are reluctant to restructure the Canadian economy by reducing regulations and lowering taxes, as those very regulations and taxes help secure their voter base. Heavy regulations stifle competition, while high taxes disincentivize investment and entrepreneurship. .Examples abound: consider the exodus of people and companies from high-tax, high-regulation states: California, Illinois, and New York. Across the pond, the UK provides another clear case, with high earners and others departing in large numbers for lower-taxed jurisdictions, including the US.President Trump wants a fair trading system between Canada and the US. What Canada truly needs, however, is a fair trading system between Ottawa and the Canadian people. The systemic issues plaguing the Canadian economy could be addressed through major reforms to the tax system and regulatory framework.Canadians can absolutely compete — if the government just gets out of the way. It doesn’t take me to tell you who is playing the Grinch who stole Christmas this year. Happy Christmas and Happy Holidays to my readers.Dr. A.W. Barber is the former Director of Asian Studies at the University of Calgary. He is internationally active and has wide-ranging interests.
