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Liberals to spend $100B to jolt post-pandemic economy after posting record $381B deficit
The Liberal government is preparing to spend up to $100 billion to kick-start the post-pandemic economy as it stares down a record-high deficit projection of more than $381 billion for this fiscal year.
In a long-awaited economic statement, tabled Monday, Finance Minister Chrystia Freeland said the government's immediate priority is to do "whatever it takes" to help Canadians and businesses stay safe and solvent.
The short-term stimulus package is valued at $70 billion to $100 billion over roughly three years. The government says the stimulus spending — intended to build a greener, more inclusive, and a more innovative and competitive economy — will launch after a vaccine is distributed and life begins to return to normal.
WATCH | Fiscal update brings more relief, stimulus spending, record deficit:
Freeland also announced the first steps in a multi-year plan to build a Canada-wide child-care system to reduce costs for families and encourage more women with kids to join the workforce. To pay for this proposed program — and to collect more revenue to cover a ballooning budget deficit — Freeland also unveiled the government's plan to levy sales taxes on digital companies.
The fiscal update projects the federal deficit will reach $381.6 billion by the end of March 2021 and could climb even higher, depending on factors such as the severity of shutdowns and the rate of COVID-19 infections.
Conservative Leader Erin O'Toole dismissed the economic statement saying a three-year plan to provide stimulus to the economy is pointless without first revealing how Canadians will be vaccinated against COVID-19.
Meanwhile, NDP Leader Jagmeet Singh said his party isn't satisfied with a plan to simply apply the GST to online business. He said he wants Canada to go much further and start taxing the revenue of large digital giants that do business in Canada. Read more on this story here.
High wire act
(Aleksander Khitrov/The Associated Press)
Industrial climbers remove ice from the cables of the Russky Bridge across the Eastern Bosphorus Strait in Vladivostok, Russia on Monday. The bridge was temporarily closed after a storm that lasted for several days left trees, cars, roads and power lines under a thick layer of ice.
Alberta and British Columbia set grim new COVID-19 records on Monday, as new measures take effect and authorities carry out enforcement in an effort to curb rising infections. Alberta reported 1,733 new cases, breaking a record set just two days ago, along with eight new deaths. There were 453 patients hospitalized with COVID-19, including 96 in ICU beds — both also new records. B.C. reported its highest-ever COVID-19 weekend death toll, with 46 deaths confirmed over the last three days. The province also recorded 2,364 new cases, including 277 historical cases that were previously missed because of a data reporting error in the Fraser Health region. Provincial Health Officer Dr. Bonnie Henry said the majority of those who died — about 80 per cent — were long-term care residents. Since the start of the pandemic, 441 people in B.C. have died of the virus. Read more on the recent developments in the pandemic.
WATCH | Alberta increases ICU capacity as COVID-19 cases rise:
Voluntary COVID-19 testing of asymptomatic students and staff is currently being introduced at designated schools in four Ontario hot spots, with the goal of improving tracking and preventing transmission. The weekend's testing blitz at Thorncliffe Park Public School — the first Toronto District School Board location selected for the voluntary testing pilot — saw 14 classes affected and sent home for two weeks. However, the rest of the school will remain open. Testing also began in Ottawa at Manordale Public School, part of the Ottawa-Carleton District School Board. Amber Mammoletti, an occasional teacher working at two schools this fall, dropped by on Sunday to be tested with her son, Flynn. "I think there's people walking around not realizing they have it — no symptoms — so it's just better to keep everyone safe: Get tested if you can and see what happens," she said. Read more about the school testing program.
WATCH | Pilot project tests students for COVID-19 at high-risk schools:
More than a year after Derek and Emilie Muth left Calgary to adopt their daughter Zoe in Nigeria, they've finally returned home. But the couple says their ordeal contains lessons for the federal government on how it could improve its citizenship process. In a 13-page letter sent to Immigration Minister Marco Mendicino, the couple recommends changes they say the government should make to prevent other families from facing a similar situation. The recommendations focus on how to streamline the process for those in urgent need. "After going through this, I'm pondering — if this is the treatment of Canadian citizens, then I can't imagine what refugees go through," the letter reads. Read more on the family's story here.
The Canadian navy's new frigates will get a cutting-edge radar system that has never before been installed on a warship — a recent decision that quietly ended a heated debate within the $60-billion warship program. The Lockheed Martin-built AN/SPY-7 radar will be installed on the new warships despite a furious back-room lobbying campaign by elements in the defence industry to convince DND to take a pass on the new system. The choice of a radar system for the frigates has important implications for the military, as well as for the taxpayers who will foot the bill for Ottawa's plan to build 15 new surface combat ships for the navy. Read more on the radar system here.
A series of pronouncements from Canada's biggest lenders this week should give us a similar glimpse of how things are doing in the real economy. The so-called Big Six banks are slated to reveal their fourth-quarter earnings starting this morning. The results will be closely scrutinized by investors and policy-makers for signs of how the consumers and businesses that borrow and save with the banks are doing. If banks report that businesses are taking out new loans to invest and grow while paying back their existing debts, that's a good sign for the economy. And if Canadian consumers are tapping banks to borrow money for such things as buying homes and other investments, that, too, is a good sign of confidence that the economy may be recovering from COVID-19. Read more about what the bank earnings could indicate.
Formula 1 champion Lewis Hamilton has tested positive for COVID-19 and will miss Sunday's Sakhir Grand Prix in Bahrain, his Mercedes-AMG Petronas team said today. Hamilton woke up Monday with mild symptoms and was told that someone he had been in contact with prior to arriving in Bahrain had tested positive. Since then, Hamilton has tested positive twice for the coronavirus. The team said the British driver is now in isolation, and that a replacement driver for Sunday's race will be named later. Read more on this story here.
Now for some good news to start your Tuesday: It's been a huge return on a small investment: Mike Doehl turned a $5 poinsettia bought at a Montreal grocery store three years ago into a looming giant. His wife, Joanne Hill, describes the festive red and green plant she brought home as "a little, crappy half-dead plant from Maxi." But Doehl used the magic of his green thumb to help it grow into a behemoth that now takes up a good part of a room in the basement of their home in Mont Saint-Hilaire, a Montreal suburb. "When things are really beautiful, I want to keep them and cherish them," Doehl said about the poinsettia. "I just love this thing. The colours make me happy, especially during this COVID time." Check out the video of the prodigious poinsettia here.
Front Burner: Liberals pledge $100B to heal the pandemic economy
On Monday, Finance Minister Chrystia Freeland announced that the Liberal government will spend up to $100 billion to support the post-pandemic economy. The priority is, as Freeland says, to do "whatever it takes" to help Canadians, despite the record-high deficit of more than $381 billion dollars.
CBC senior parliamentary reporter David Cochrane breaks down the details of the economic update, and what critics had to say about it.
Today in history: December 1
1922: Driving on the right-hand side of the road begins in New Brunswick.
1962: In a first, the Grey Cup game fails to finish on the day it started. Fog at Toronto's CNE Stadium forced the game between the Winnipeg Blue Bombers and Hamilton Tiger-Cats to be suspended in the fourth quarter. It resumed the next day, but there was no further scoring as the Bombers won 28-27 to claim their fourth CFL title in five years.
1996: Business tycoon Peter Bronfman, who with his brother Edward controlled one of the largest corporate empires ever assembled in Canada, dies at age 67.
2008: The Liberals, NDP and Bloc Québécois, which together held more than half of the seats in the House of Commons, sign a historic accord that would support a Liberal-NDP coalition government for at least 18 months, in the event the minority Conservative government fell in an upcoming confidence vote.
With files from The Canadian Press, The Associated Press and Reuters