The government spends more every year, but your standard of living hardly budges. So is all that spending really working? (Troy Media)
The government spends more every year, but your standard of living hardly budges. So is all that spending really working? ~~ by Ian Madsen The idea that government spending drives economic growth is not just mistaken—it’s economically destructive. Politicians routinely describe higher government spending as “stimulative” and any attempt to slow it as “austere” or anti-growth. Some even label modest increases “restrictive” if they don’t match prior growth rates. But this thinking isn’t supported by evidence. Canada’s own experience proves that rising public spending has not translated into prosperity. In fact, it has done the opposite. For the past decade, government spending in Canada has grown faster than the economy. According to Statistics Canada , federal debt exploded from $649 billion in 2014 to nearly $1.44 trillion in 2024, a compound annual growth rate (CAGR) of 8.3 per cent (CAGR is the average annual growth rate that accounts for the effect of compounding o...