Will Canada’s Economic downturn will be worse than other advanced nations? Depends on The INTERNATIONAL value of the Canadian Dollar – January 2, 2023
Fiscally, the Canadian economy is a disaster; in fact, the best thing Canada has going for itself is that it borders with the United States. Many businesses in Canada exist to EXPORT their product to the United States.
Lucky for Canada, Donald Trump lost the 2020 election because, had he won, a lot more businesses would have left Canada for the United States, as one of Donald Trump’s economic plans was to TAX/Tariff countries he imagined weren’t playing fair.
Canada, via Justin Trudeau, declared war on the Canadian consumer by raising taxes, growing the government workforce, and piling on regulations to restrict productivity.
Most people don’t think about this, but regulations are a TAX. Justin Trudeau’s excessive FEDERAL energy regulations on domestic energy consumption have forced Canadian businesses to raise their prices.
With that said, Canada, even before Justin Trudeau, was becoming increasingly dependent on IMPORTS. So, currently, most of Canada’s consumption is imported, meaning that the strength of the Canadian dollar is significant to keeping the fragile Socialist-Progressive pipe dream going.
So, for myself I was actually impressed by Tiff Macklem for actually raising interest rates. I was not a Stephen Poloz fan; being that Stephen Harper’s economy was doing fairly well, that was time to raise interest rates. Instead, Stephen Harper and Stephen Poloz created the perfect environment for Justin Trudeau to run on RAISING THE DEFICIT.
Below is the Trudeau popularity tracker by Angus Reid; if the data does not show up below, you can click the link provided or search for “Trudeau popularity in Google”.
When I write about the incompetence of Justin Trudeau, I don’t excuse the Canadian voter in all of this. I actually voted for Stephen Harper when he lost to Trudeau, but most of these weirdo Conservative voters didn’t show up to the polls.
This was the event that changed my mind about Democracy in Canada because all the signs of a tyrannical CANDIDATE, Justin Trudeau, were there. Until the PPC showed up, my intention was to vote for the Libertarian Party.
Although Maxime Bernier isn’t perfect, he gives his political career some effort; my knock on the Libertarian Party is the problem I have with all Libertarians: they’re very complacent.
When I think libertarians, I imagine a few people who know what the problem is but don’t have the energy necessary to do anything about it. I “identify” as an Anarcho-Capitalist; the two politicians I admire the most, oddly enough, are Hispanics, Luis Fortuño (former Governor of Puerto Rico) and current President of Argentina Javier Milei.
Until I see some austerity, I’m not taking you seriously. Pierre Poilievre for example, would be wise to simply lie to voters when he becomes Prime Minister and start doing massive cuts to government.
However, based on his party loyalty and his public sector upbringing, I’m not so sure. Most of the problems in Canada, stem from the Federal Government of Canada not allowing cities, and provinces to FAIL.
Canadian Equalization Payment Numbers in 2023
- Quebec: $14 billion
- Manitoba: $3.5 billion
- Nova Scotia: $2.8 billion
- New Brunswick: $2.6 billion
- Prince Edward Island: $561 million
- Ontario: $421 million
In America, the Federal Government allows bad ideas in municipalities and States to FAIL, which is why a lot of Americans tend to relocate whenever a far-left Democrat takes over a city or State.
In Canada, it can be difficult to observe which Province is doing well and which Province is failing, because the Federal Government bails out all the bad fiscal ideas.
Quebec, for example, is a perpetual have-not province that is hopelessly bankrupt but is propped up by the Federal government via transfer payments and the Federal government BORROWING money from the central bank.
So this is one of the reasons why, in the mind of a CANADIAN Leftist, they can imagine that economies fix themselves. In Argentina, for example, nobody wants the Argentine Pesos; there’s no DEMAND for the Argentine Peso, the Argentine Peso is too politicized in that if I purchase an Argentine peso as a foreigner, I know the Argentine government will pay itself and it’s government first and not even consider me let alone it’s own citizens.
Now, what separates Canada from Argentina pre-Javier Milei are government regulations. Argentina is a regulations NIGHTMARE, and it’s been like this in Argentina for a long time.
Pierre Trudeau attempted to turn Canada into a regulations nightmare, and this created the REFORM party, now for many they call the Reform Party a failure, I saw it as a success, because from that REFORM Party, we got the Jean Chrétien Liberals.
The Jean Chrétien Liberals were not perfect, but they were forced to implement austerity. Now, had the Reform Party stuck around, some argue that the Liberals would have never lost power; I argue that’s a stupid argument, as currently, the NDP and Liberals have basically merged together to stop the Conservatives Party, meaning that VOTE SPLITTING is a myth?
The Domestic Canadian economy is a complete disaster; however, do not underestimate the Foreign exchange markets. Because if you ask me, even if Tiff Macklem or some other central banker cuts interest rates, that doesn’t solve anything; that could actually accelerate the problem on both ends.
A stronger Loonie will NOT equate to lower prices for DOMESTIC goods in Canada, and a stronger Loonie could also cost Canadians jobs because, as I like to point out, a lot of the economic problems in Canada stem from MUNICIPAL governments.
Municipalities in Canada, are not allowed to fail, that’s been the system in Canada, and failure is the only way to DEFLATE prices, this is even a problem in the U.S. but the problem is worse in Canada, because of our transfer payment agreements.
You can call it stagflation; you can call it a bunch of things; what will have to happen soon is cutting regulations and taxes on energy, but what people are forgetting are all the existing PRICE CONTROLS in Canada.
Supply Management, for example, is a PRICE CONTROL; it’s not only a price control for consumers, it’s a WAGE/PRICE control for the hundreds of thousands of people dependent on supply management; once you comprehend all the DOMESTIC price control mechanisms in Canada, you start to comprehend my argument, that until we start having a discussion about austerity measures, you can be certain that Canadian economic downturn will be among the worst in the developed world.
Interesting times ahead!