Listen Up! Do we give a damn about public debt and public spending?  | Commentary

I sometimes wonder about that. With almost unmanageable public debt at the federal and Ontario levels, and significantly increased spending at all levels of government, including municipal, do we really care?

With apologies to soccer fans, of whom there are many in Canada, I began thinking about this again with the launch of the FIFA World Cup games in Toronto this week. 

Soccer has become a national sport in Canada. Both my grandson and granddaughter have played it, as have hundreds, if not thousands, of kids in Muskoka. And in Toronto, 43,002 spectators paid between $900.00 and $2,391.00 to watch the game in person, a ticket price that few ordinary Canadians could afford.

So, to be clear, my concern is not about the importance of soccer to many Canadians. I fully understand and support that. Rather, the concern is whether or not Canada can afford to host World Cup games at a time when the future of Canada’s economy is seriously challenged. 

Canada’s Parliamentary Budget Officer has reported that the World Cup games will cost taxpayers in this country about $1 billion. Noel Jarvis, Ontario Director of the Canadian Taxpayers Association, says, “It’s a bad idea to shell out a billion dollars for a few World Cup games when our governments are in deep debt and every day taxpayers are struggling with rising prices.” 

Clearly, there are some benefits for Canada in hosting World Cup games. They increase tourism, create short-term jobs, promote soccer in Canada, and generate international media exposure.

It should be noted, though, that the majority of any economic benefits arising from the World Cup games will be concentrated in Toronto and Vancouver. Yet tens of millions of Canadians outside those two cities will be paying their full share of the $1 billion debt incurred by these games.

According to an article in the Toronto Star, Claire Fan, a senior economist at the Royal Bank of Canada (RBC), is quoted as saying, “FIFA related job growth, regardless of size, will likely be temporary and part time so, (The World Cup) is not a sustainable source of job growth.”  She also said that these positions could fade as early as July or August.

Considering the costs related to the World Cup games, the Bank of Montreal (BMO) predicts that Canada’s Gross Domestic Product (GDP) will grow by 0.1 percentage points.

“That’s very, very small.” BMO’s senior economist, Shelly Kaushick, told the Toronto Star. “So, it’s not going to necessarily change the picture in Canada. The fact is that there’s all these bigger headwinds right now to the economy, specifically, the energy price shock, and of course all the trade uncertainty that we are still dealing with.” 

To be fair, it was former leaders, Prime Minister Justin Trudeau, Ontario Premier Kathleen Wynne and Toronto Mayor John Tory who applied to bring the 2026 FIFA World Cup games to Ontario. Prime Minister Mark Carney, Premier Doug Ford and Mayor Olivia Chow should not be made to hold the bag for this, nor can they now be blamed for making the best of it.

But even when Canada’s bid for the FIFA World Cup was initiated, there were serious signs of economic strain in Canada. Discretionary spending then was as much of an issue as it is today.

What now makes the FIFA World Cup games in Canada more than just a one-off expenditure is the fiscal context in which they are being held. It should be a clarion call that these games, however popular, however beneficial, are unaffordable and therefore, in the long run, not beneficial to Canadians.

So, let’s look at that fiscal background. Canada currently has a debt of $1.3 trillion, not billion, trillion. Add to that the projected federal deficit of $55.3 billion for 2026.

Then we have Ontario’s debt, at about $485 billion, with a projected 2026 deficit of $13.5 billion on top of that.

During the last four years, federal spending has increased by 27%. Ontario spending over the past four years has increased by about the same. Roughly, that represents a quarter more federal and provincial spending in just four years.

Municipal councils are not allowed to have deficits, but they don’t get off the hook when it comes to increased spending. During the past four years, the District Municipality of Muskoka has raised their operating spending by 26%. 

Over the past four years, the Town of Huntsville has increased their staffing costs by 42%. They have also spent $4 million from the Town’s reserve accounts. Together with additional revenue they received, such as dividend payments from Lakeland Holdings, they were able to keep the four-year cumulative tax rate to about 25% even though their actual overall new spending was significantly higher, likely closer to 10% in each of the four years of their term.

Given combined spending increases and debt at all three levels of government, there are, in my view, and in the view of many economists, serious questions to be addressed related to the health of Canada’s economy now, and perhaps more importantly in the not-too-distant future. 

There are those who will say that, given our current fiscal situation, a billion-dollar deficit to have the World Cup games in Canada is just a drop in the bucket. That may be true. The reality, however, is that there is also a hole in that bucket, and it is getting much bigger to the point of causing serious damage to our economy.

To me, the World Cup games in Canada, with its billion-dollar deficit, are just the tip of the iceberg, a wakeup call that increased spending, especially discretionary spending, has gone way above its limits and is a sign that we can’t afford taxpayer-funded luxuries for the foreseeable future. 

Sadly, though, I wonder how many people in Canada give a damn. Certainly, one does not see that much about it in the media or in public forums. Perhaps more than a trillion-dollar debt is impossible to comprehend and that living life in the moment is more important. 

So, do we have our fun at public expense? Or do we say loudly and clearly that enough is enough?

A tough question to ask, but a necessary one.

Hugh Mackenzie                                            

Hugh Mackenzie has held elected office as a trustee on the Muskoka Board of Education, a Huntsville councillor, a District councillor, and mayor of Huntsville. He has also served as chairman of the District of Muskoka and as chief of staff to the former Premier of Ontario, Frank Miller.

Hugh has also served on a number of provincial, federal and local boards, including chair of the Ontario Health Disciplines Board, vice-chair of the Ontario Family Health Network, vice-chair of the Ontario Election Finance Commission, and board member of Roy Thomson Hall, the National Theatre School of Canada, and the Anglican Church of Canada. Locally, he has served as president of the Huntsville Rotary Club, chair of Huntsville District Memorial Hospital, chair of the Huntsville Hospital Foundation, president of Huntsville Festival of the Arts, and board member of Community Living Huntsville.

In business, Hugh Mackenzie has a background in radio and newspaper publishing. He was also a founding partner and CEO of Enterprise Canada, a national public affairs and strategic communications firm established in 1986.

Currently, Hugh is president of C3 Digital Media Inc., the parent company of Doppler Online, and he enjoys writing commentary for Huntsville Doppler.

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