Conservative leader Pierre Poilievre released the second episode of his Debtonation series on Sunday, Debtonation—Episode 2: Exploding debts & how we can rescue Canada from them.
The release follows up on the first episode which has garnered nearly one million views since its December release.
Both episodes pale in comparison to the 4.6 million views currently held by Poilievre’s documentary, Housing hell: How we got here and how we get out.
The second episode of Poilievre’s Debtonation series reminded viewers of the four indicators of forthcoming debt crises covered in the first video. They are sustained debt build-up, specifically household debt, asset price inflation, failing output, and large account deficits.
“Have these things happened in Canada?” Poilievre asked, answering the question.
He said that the current debt owed by all Canadians is $10.2 trillion.
“It might be hard for a 100-pound man to carry his own weight on his back. Now imagine him carrying 350 pounds, or three and a half times his body weight. He can barely move, and it won’t be long before he collapses. That is like Canada’s $2.86 trillion economy carrying around its $10.2 trillion debt,” said Poilievre.
The Conservative leader explained that since 2015, when Prime Minister Justin Trudeau took office, Canada’s total public and private debt has increased from $7.9 trillion to $10.2 trillion — an increase of 28.5% while real GDP grew only by 14.1%.
“Our debts are growing twice as fast as the incomes with which we pay those debts,” he added.
Renaud Brossard, the vice president of communications at the Montreal Economic Institute, told True North that when looking at general government debt, Canada is over 110% of GDP.
“Canada’s high debt load, at all levels of government, costs taxpayers a significant amount of money on interest payments every year,” he said. “As more and more debt rolls over and has to be refinanced at higher rates, we risk spending more and more money on interest payments, and less on the services Canadians need.”
Poilievre revealed that the problem worsens when looking beyond government debt. The total consumer, corporate, and government debt combined is 357% of Canada’s GDP, he said.
The documentary compared Canada’s current debt to the biggest debt crises in history.
Three of the main crises explored were the Great Depression, the Greek debt crisis, and the United States’ 2008 financial crisis, each with a lower debt-to-GDP ratio than Canada today.
“In the 48 most significant financial crises of the last century, Canada currently has a bigger debt ratio than all but three of them,” said Poilievre.
In the majority of the 48 crises, countries’ economies imploded with debts less than 300% of GDP.
“So, what makes us immune from the same fate? Are we special? We may think we are, but we can be sure that every one of those other countries thought they were special too, until they weren’t,” said Poilievre.
Finance Minister Chrystia Freeland often says that Canada has the lowest debt-to-GDP ratio in the G7, which Poilievre claimed to be “a commonly repeated falsehood.”
The International Monetary Fund shows that in 2023, Canada’s gross debt was just over 106%, higher than G7 countries like Germany and the United States, and tied with France.
Canada has the lowest net debt to GDP ratio, which deducts assets from the Canada Pension Plan, the Quebec Pension Plan, and other assets Poilievre says that the government would never be able to use without extreme outcry and pushback from pensioners.
A common excuse used for overspending is the pandemic, explained Poilievre. However, the Parliamentary Budget Officer showed that 35.5% of new spending by the feds during the pandemic had nothing to do with Covid.
“The federal deficit, adjusted for inflation and the size of the economy, was 64% bigger than it was in World War One and 2.5x bigger than it was during the global financial crisis. Only during the Second World War was the deficit bigger,” said Poilievre.
He warned that the federal government forecasts an additional $186 billion in deficit spending by 2029, with no plans to balance the budget.
While the debt of the federal government and corporations is of concern, Canadians’ personal debt levels are as well, according to Poilievre.
According to the TD Bank, Canadians devote 15.4% of their incomes to paying debts. Before the global financial crisis, Americans spent 13.2% of their incomes towards debt, “and that was what led to a massive economic crisis south of the border,” said the Conservative leader.
The poorer you are, the worse the debt crisis in Canada is. Poilievre highlighted that those aged 45 to 54 in the lowest income quintile had debts equal to 732% of their disposal income — an increase of over 300% since 2014.
“Canada’s debt to GDP ratio has smashed records over the last several years, is 50% higher than its long-term average, and much higher than was the case in many countries just before they went into a debt crisis,” Poilievre said.
Conservative MP Michelle Rempel Garner replied to the documentary in a post to X.
“I have no doubt Mr. Poilievre wrote much of this content himself. I can’t imagine Mr. Trudeau trying to do the same,” she said.
