The Deputy Prime Minister's legacy will be spend, tax, borrow, repeat
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It’s never much fun to watch someone fall from grace – unless, of course, the fallen never had much grace to start with.
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Chrystia Freeland is many things, but, at least in her public roles, graceful has never been her hallmark.
It would be hard to argue that Freeland isn’t smart. She studied Russian literature at Harvard and earned a masters in Slavic Studies from Oxford. She had a successful career in journalism and wrote a couple of books that were well reviewed.
Those are not small accomplishments.
But her rise, and subsequent fall, on the public stage began in 2013 when she replaced Bob Rae as MP in a safe Liberal seat, Toronto Centre.
In 2015, she began her time in the sunny ways of the new Trudeau government. From 2015 through 2019, she served as minister of international trade and then minister of foreign affairs. Those were the good old days.
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By the time Freeland became deputy prime minister and minister of finance in 2020 some in the media were calling her Trudeau’s minister of everything. She was obviously heading for the prime minister’s chair the moment Trudeau vacated it.
But that was then. These days are a little less shinny for Freeland.
There must have been moments over the last nine years when she thought things were going a little sideways. Perhaps she had some minor pangs when the Trudeau Liberals threw two women cabinet ministers – Jody Wilson-Rayboult and Jane Philpott – out of the party.
But heck, what’s a principal or two in the heady business of running a country?
It might have seemed a little ironic, given her history with autocratic regimes, when she asked the banks to freeze the assets of Canadian dissidents. But, gosh, the government had to trample a few small civil rights, didn’t they?
And then there was the unfortunate end of Bill Morneau’s political career in 2020. Someone had to walk the plank over the WE Charity scandal and, heck, Morneau’s leaving vacated the finance ministers chair for Freeland.
But all those dark moments were just speed bumps on Freeland’s way over the cliff. This year Freeland tabled her fourth budget and it landed with a thump.
Back in 2019, the government had revenues of about $335 billion. That’s a lot of cash, but the Liberals still managed to run a $20 billion deficit.
Fast forward to 2024 and revenues have jumped to about $500 billion. To borrow from Lenard Cohen, hallelujah! But even with all that tax revenue Freeland is going to have a $40 billion dollar shortfall.
It doesn’t take a genius to figure out Freeland doesn’t have a revenue problem, she has a spending crisis. But Freeland thinks Canadians aren’t paying enough tax.
She increased the tax on capital gains to partially compensate for new spending. It’s all about “asking the wealthiest Canadians to pay their fair share.”
I’m pretty sure most Canadians would find it grossly unfair to take more than 50 cents of every dollar earned in taxes. But Canada’s top tax rate is well over 50%.
I’m equally sure most Canadians think it unfair to tax the same dollar twice or put a tax on a tax. But that is precisely what Freeland is doing with carbon taxes and the higher percentage of capital gains tax.
And that is Freeland’s legacy. Spend, tax, borrow. Repeat.
Sorry Chrystia, but you just can’t tax and spend your way to the prime minister’s office.
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