As the burden of taxes, regulations, and policies that hurt Canadian workers continues to worsen, people are going further and further into debt to try and maintain their standard of living.
The Organization for Economic Cooperation and Development has issued a warning on rising debt levels.
As you can imagine, they point out that high household debt levels will have a negative impact on growth.
Unfortunately for Canada, we have the highest household debt levels in the entire world.
While South Korea and the U.K. are high on the list with private debt levels of just over 80% of GDP each, Canada’s private debt load is over 100% of GDP.
As noted by the OECD, “Household and corporate debt in many advanced and emerging market economies is high. While higher indebtedness does not necessarily imply that problems are just around the corner, it does increase vulnerability to shocks.”
Fake economy can’t last forever
While the elites have tried to make people think the economy is great by selectively quoting economic reports, polls show Canadians getting more and more pessimistic about the future.
That pessimism makes sense, as almost all economic growth has been concentrated in a small elite. Any other “growth” has been based on debt, particularly debt-fuelled consumption, making problems worse over time.
With large numbers of new labour being added every year through the immigration system, higher taxes raising the cost of living, and excessive regulations reducing the number of good jobs, millions of Canadians are in a tough fight to hold on to our standard of living. Low interest rates and easy credit enabled people to hold on for a while, but it’s not sustainable.
As a result, our growth is increasingly built upon debt and short-term consumption, rather than a strong long-term foundation for the economy. In many ways, we have become reliant on a fake economy that has made Canada increasingly vulnerable, and that won’t change until we have a government that cuts regulations, brings in big tax cuts, and increases the leverage of workers.