Prime Minister Trudeau thinks Canadians achieve better lives through government dependence
It’s hard to argue with the Trudeau government’s rhetoric about how Canadians can achieve a better life. One of the first sentences in the recent federal budget reads, “At the centre of the Canadian story is the middle class and the promise of progress: that with optimism and hard work, a better life is possible for everyone.”
While the government is right to tout the importance of hard work as key to a better life, its actions do not match this lofty rhetoric. In reality, the Trudeau government has implemented policies that encourage dependence on government—not hard work and independence. Policies that reward hard work allow Canadians to keep more of the money they earn. Policies based on cash transfers from government encourage dependency.
To support its rhetoric about hard work and progress, the Trudeau government often claims that it has cut taxes for middle-class Canadian families. After all, a tax cut would reward hard work and encourage independence. But that’s not actually what the Trudeau government has done for the vast majority of middle-class families.
While it did reduce the second lowest federal income tax rate (from 22 to 20.5 per cent), it also eliminated a number of tax credits (provisions in the tax code that reduce a person’s income taxes if they qualify), thereby increasing income taxes for Canadians who previously claimed such credits.
As a recent study found, when the Trudeau government’s tax changes are broadly considered (including both the tax rate reduction and the elimination of these tax credits), 81 per cent of middle-class Canadian families with children are paying more in personal income taxes—$840 more per year, on average.
When recently confronted with this reality on the floor of the House of Commons, Prime Minister Trudeau did not deny it. He simply responded by pointing to the increased government transfers his government has provided to qualifying Canadian families—specifically, the Canada Child Benefit (CCB), a new transfer to qualifying parents with young children that combined several previous programs and increased the cash benefit.
To be clear, the CCB is a transfer program that fosters dependence on government; it’s not a policy that rewards hard work by allowing Canadians to keep more of what they earn. Essentially, the prime minister is saying the government will take more away from what you earn and give some of it back to certain families. This hardly fits with the government’s rhetoric on hard work and building a better life.
But it’s even more perverse than that. If Canadian families who receive CCB transfers do achieve success and earn a higher income, their cash transfers will be reduced—a disincentive to hard work and independence. (The specific amount the transfer is reduced depends on a family’s income level and number of children.)
If the Trudeau government is genuinely interested in rewarding hard work and helping Canadians build a better life, then it should look for ways to actually reduce taxes on middle-class families—not foster dependency through government transfers.
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