Trudeau does a masterful job capturing the collective ignorance of the masses. With the help of a wildly biased and determined left wing media, we are witnessing the withdrawal of reason and the impending emergence of a tired, tested and failed Keynesian model of economics. In Trudeau’s naiveté we are beholding the “change” and billions this change costs without any mention of cost; other than Trudeau telling the reporter to whip out his calculator and do the math himself. Sadly, no intelligent discussion is possible when the leader has no clue of the systemic damages caused by Keynesian economics.
The basic flaw of Trudeau’s economic model is he presupposes he and his team are smart enough to manage and strengthen the economy through debt based investment. The idea that the free market is either too evil, stupid or a breeding ground for tax cheats like those sneaky small business owners, Trudeau has a fundamental distrust in the choices of Canadians and therefore he proclaims a need to intervene in the economy and do the building himself (no wonder he likes China dictatorship; because they can turn their economy around on a dime). This will invariably result in the malinvestments, cost over runs, nepotism in issuing bids and jobs to contractors (which Liberals have always been experts at) and misguided direction of investments that come with central planning. An inevitable fallout from the nature of his investments will be: capital exiting our country, increased trade deficits (we will export less and be less competitive), sustained budget deficits that compile our debt and therefore damage our debt to GDP ratio; likely resulting in a downgrade of our AAA credit (as we have seen with the Ontario Liberals) which will result in higher borrowing costs and the opposite effect of the Liberals benevolent heart: a shrinking middle class. Do you notice how Mr. Trudeau never compares his plan against a debt to GDP ratio or any set of economic key indicators? Are the voters to stupid to process the data? Or, would voters then see the economic damage and be less interested in a spending frenzy that Trudeau heralds as the coming change? I suspect a bit of both. If you look at the economies of Greece and Ontario we can see what an unmeasured Keynesian approach to economics does to a region.
Make no mistake, Greece like damage wont hit right away; even Greece took decades for the wick to run out and the country to blow up. My argument is that Trudeau’s promises of today will contribute to your children’s debt load, credit downgrade and smaller middle class of tomorrow. All his promises will cost a lot of money. All his promises will need a slew of bureaucrats to manage. Who will pay for these promises? The promises will be paid for in part via bonds that our kids will eventually have called due, by large corporations, the tax cheating business owners and those rich people who have way too much money. As frustrated as several Canadians are (and some bitter and jealous) with those who do well, there will be great damage if we manipulate the markets to the degree Trudeau is proposing. Trudeau controlling, monitoring, selecting which industries do well, regulating beyond measure and having his team decide how the economy will grow is likely going to result in the exit of many earners. Earners produce a return on their capital and time. Trudeau will make this a very unwelcome place for those earners to get their return and they will eventually stop filling the piggy bank with tax revenue from their exploits. And when they do, who is going to pay for all the promises? This is when things spiral out of control and the saying is more obvious than when times are good: socialism is great until you run out of other people’s money. Alberta is learning this the hard way. Pressing change by electing a central planning government isn't so cool now, eh? A centrally planned Keynesian economy is at the heart of the Liberal plan and NOT the change Canada needs or can afford. Don’t be fooled by the Obama mantra of change redux that Trudeau is recycling. We already got an idea of what that change meant in the USA: $7 trillion in new debt and an unstable currency.
I will be demanding change for more freedoms, less taxes, more accountability and a stronger economy. Pressing the Conservatives for this change is the best hope for our families and country.