Prime Minister Justin Trudeau is growing Canada’s debt faster on a per capita basis than any other peacetime government leader in this country with the exception of those who struggled with recessions, says the Fraser Institute’s director of fiscal studies.
“This is unprecedented in history,” said the think-tank’s Charles Lammam in an interview Tuesday. “You’d have to go back more than 100 years to see a prime minister who increased the debt without a recession or a world war.”
Tuesday, the Fraser Institute released a report written by Lammam and co-author Hugh MacIntyre. Dubbed An Analysis of Federal Debt in Canada by Prime Ministers Since Confederation, the report, reveals the percentage by which all but three prime ministers either added or subtracted to the national debt, using as their metric the value of that debt in 2017 dollars on a per capita basis. Three prime ministers were excluded from the report because they served three months or less.
“Of the prime ministers who did not face a global conflict or economic downturn during their tenure, the analysis finds that by the end of his term in 2019, Justin Trudeau is expected to be the largest debt accumulator,” states that report.
According to the report’s authors, the current prime minister is expected to grow to national debt by 4.73 per cent by the end of his term of office.
“We’re talking about $100 billion in federal debt,” said Lammam. “That’s approximately $1,400 for every man woman and child in Canada.”
During war years or recessions, other prime ministers have added a lot more to the debt in percentage terms than the current prime minister.
The biggest percentage jump in the national debt came during the First World War and the recessions of Nova Scotia-born Prime Minister Robert Borden's tenure. According the Fraser Institute report, the Conservative prime minister almost tripled the national debt on a per capita basis, increasing it by 188 per cent.
Liberal Prime Minister William Lyon Mackenzie King, who served during the Second World War, two recessions and a couple of economic downturns, also massively added to the Canadian debt. King raised the debt by 145 per cent during his time in office. During his first stint in office – at a time when there was no global conflict - he had cut the debt by five per cent.
It’s the current prime minister’s father, Pierre Elliott Trudeau, who holds the dubious distinction of raising the country’s debt by the third-highest percentage of 57 per cent. But the senior Trudeau also had to wrestled with economic troubles in Canada, including two recessions during his second term as prime minister.
When his son won the election to become the current prime minister in October two years ago, he inherited a far different fiscal reality from then outgoing Prime Minister Stephen Harper.
“(Prime Minister) Justin Trudeau came into office approximately halfway through the fiscal year and immediately increased government spending. These increases contributed to a budget deficit of $1 billion, whereas Harper’s 2015 budget planned for a surplus of $1.4 billion,” states the Fraser Institute report.