CRESCIA: Where do the Liberals get their crazy economic ideas?

It has been said that bad things come in threes. Well, how about Justin Trudeau, Finance Minister Chrystia Freeland and NDP leader Jagmeet Singh? Between them, they have run the country’s economy into the ground. Not one of them has a business background; not one has any idea of the sacrifices involved in operating a successful business, and each one is a disciple of the World Economic Forum. So, no one should be surprised that the recent budget's new capital gains tax will increase taxes from 50 percent to 66 percent for corporations, trusts, and individuals on gains above $250,000. This further divides an already divided country by social class, pitting the rich against everyone else.The Liberals, desperate to improve their standing in the polls decided to leave out the capital gains tax change from the budget and pass it as a separate bill. With this carefully calculated move, they hoped to isolate the Conservatives and force them to vote on that specific issue: The Liberals hoped thus to create a new political narrative that Conservatives are not only MAGA supporters but also represent the interests of the rich, while Liberals support working people. As Prime Minister Trudeau observed during an interview, “The system is not fair anymore for young people. Young people don't see the economy that way. Far too many young people have given up on owning a home. Gen Z and millennials represent the largest part of the workforce and if they don’t feel that hard work won’t give them a good life they are in danger of disconnecting.” So that's the narrative and since 2015 the Trudeau Liberals have preyed upon high-income earners, by raising the personal income tax rate to 33 percent from 29, taxing share buybacks and increasing corporate taxes. It has also introduced a special tax on banks and insurance companies that has contributed to the struggles Canadian banks face, as profits fall and their share price has underperformed during the past two years.According to the Bank of Canada, the country’s weak productivity growth and sluggish business investment are a national emergency. The country’s growth rate on a GDP per person is at the bottom among OECD countries and business investment has declined by $43.7 billion between 2014 and 2021. Since the pandemic, the economy has stagnated with a GDP seven percent below its long-term trend or a decline of about $4,200 per person. “We are in a recession. We are in a per capita recession. If you look at per capita GDP growth, it’s negative and it’s approaching rates that we saw in the 1991 recession and in the 2008 recession,” states Benjamin Tal, the Deputy economist at the CIBC. Increasing capital gains will make everything worse by incentivizing people not to sell assets instead of turning a profit and deploying profits in other areas of the economy money will be locked in as the wealthy do not need to sell what they own, restricting economic growth.Finance Minister Freeland loves to preach that the tax increase will only impact 0.13 of the population or 40,000 individuals, but fails to appreciate the psychological impact of this, as capital gains taxes strike at the heart of capitalism, demotivating people and taking away the incentive for businesses to innovate and invest. According to Statistics Canada, 98 percent of businesses in Canada are small businesses. Yet, they employ 64 percent of the workforce which represents more than 10 million people. People sacrifice their lives and risk their savings to take a chance at succeeding and a low capital gains rate is the best incentive to support small businesses and allow entrepreneurs to promote economic growth by creating new jobs.One of the few high-tech Canadian companies to make it internationally is Shopify. Its CEO Tobias Lutke hit it out of the park when he commented on X: “Huge increase in government hiring double the rate versus private hiring, self-employment, starting a new business was negative and that would lead to poverty. Every month there is something new for free, dental, pharma, contraception will mean even more new taxes…this government wants to appear like they are doing something.” Making everything free is easy when a government prints loads of money. But, without sustainable growth to pay for expensive social programs, this represents a one-way ticket to even higher taxation. Next up, and it is only a matter of time as it is in the Liberals 2021 platform, is taxing capital gains on a principal residence. With this tax, the Liberals are walking a tightrope and realize it would be widely unpopular so they keep denying it, but as anyone knows when Liberals keep denying something, it is usually true. To sum up, the WEF has stated that in the "future, you’ll own nothing and you'll be happy. You'll rent whatever you want and it'll be delivered by drone." Under the reckless economic policies of the Trudeau Liberals-NDP alliance the country is killing entrepreneurialism, forcing its best and brightest to head south, accepting economic stagnation as the new norm, and making owning assets a tax burden, but owning nothing a virtue. The economic policies of Ottawa and the WEF are firmly in sync.Francis Crescia is a Toronto-based writer.

CRESCIA: Where do the Liberals get their crazy economic ideas?

Related Stories