Liberal budget sets scene for a $113 billion deficit

Canada will run more than $113-billion worth of federal government deficits over the next five years, according to today’s budget. The Liberal government says that the lagging economy calls for major infrastructure spending and investments that encourage innovation, even if that means higher deficits. Austerity measures aimed at balancing the budget would damage the economy, the government says. “Canadians understand that a country can’t cut its way to prosperity,” reads the introduction of the 270-page budget titled Growing the Middle Class. The approach drew praise from the country’s largest labour group. “I think most workers will be relieved,” said Canada Labour Congress president Hassan Yussuff. A $29.4-billion deficit is expected for the 2016-17 fiscal year, with an additional $29-billion deficit expected next year. The deficits then begin to decline, with a $14.3-billion deficit predicted for the 2020-21 fiscal year