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‘Incineration’ economics is not the answer to global woes, Freeland warns – National

Finance Minister Chrystia Freeland said Canada will not look to a “burning” economy as the world prepares for a looming recession.

Her comments came after she filed a fall economic statement Thursday that warned Canada would face “substantially weaker growth” and risk stubborn and prolonged inflation in the coming months.

Despite the dire economic outlook for the global economy, the fall economic statement included a net of about $30 billion in new spending measures over the next six years, Freeland said in an interview with defended the waist block‘s Mercedes Stevenson, airing Sundays.

“We saw a few weeks ago what happens when far-right governments decide that the only solution to a difficult global economy is to cut and burn,” Freeland said.

“That’s what we saw with[former prime minister]Liz Truss of the UK, and the results weren’t pretty.”

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Inflation will shape Canada’s economic fate, Ottawa fiscal update shows

The Bank of England warned this week that “reports are heading for the longest recession since records began”. Truss’ plan was widely denounced as trickle-down economics, and Freeland said the world had seen the British pound “plunge”, and the reaction was swift.

“The UK pension fund was on the brink of collapse and the Bank of England had to step in to save the UK economy,” Freeland said.

“We are not going to do that in Canada.”

Freeland added that times of economic uncertainty are “when social safety nets are most needed and when Canadians need EI and CPP security.”

“And we’re going to protect it,” she added.

Meanwhile, Conservative leader Pierre Polivre denounced Thursday’s economic statement in the House of Commons as an “inflationary scheme”.

Opposition leaders criticized liberals for not making budget cuts to match the $30.6 billion in new spending over the six years outlined in the update.


Click to play video: 'Federal government warns Canadians of upcoming economic challenges'

Federal government warns Canadians of more economic challenges ahead


But in events before the fall economic statement was submitted, Poilievre was critical of the current government’s economic plans, including pushing for higher CPP and EI premiums. He sees the tax increase as a “tax” and has repeatedly asked the government to change course.

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In a speech on Friday, Prime Minister Justin Trudeau rallied. He accused Polyvre’s Conservative Party of defending a “failed” policy.

“They’re actually doubling down on the old failed theory of trickle-down economics, which means cutting taxes for the wealthy while hollowing out the middle class,” he said.

The federal government, on the other hand, has not explicitly stated in its projections whether it believes Canada will enter a recession, despite a growing chorus of voices predicting such a recession.

A consensus of economists surveyed in September had forecast “significantly weaker growth” than predicted in this spring’s Ottawa budget. Growth will be “just above zero in the next few quarters” and the unemployment rate will rise to 6.3% by the end of 2023.

The forecast also puts Canada in a 40% chance of going into recession. But the Ottawa update also provides a “downside scenario” outlining the worst case amidst economic uncertainty.

— Craig Lord of Global News, with files from Amanda Connolly

© 2022 Global News, a division of Corus Entertainment Inc.



‘Incineration’ economics is not the answer to global woes, Freeland warns – National

Source link ‘Incineration’ economics is not the answer to global woes, Freeland warns – National

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