Federal Government & Politics II

[Truenorth00]

Originally Posted by YOWetal

There is absolutely zero chance the rebalancing is more spending for millenials.

Who said it has to be more spending? The next government has to make big cuts. What they choose to cut (and how much) will say a lot about which generational cohorts they are prioritizing.

They are basically surging to a majority thanks to younger voters. It'll be interesting to see if they return the favour. Or we end up with even angrier Millennial and Zoomer voters in 2029. Which will also be the first election when Alphas can vote.

[Truenorth00]

Originally Posted by YOWetal

I doubt Canada is the first to launch some kind of generational tax advanatage.

This is actually exactly what one of Harper's economic advisors suggested. He suggested making the first $250k of income tax free. He saw it as a way of counteracting the advantage of the land wealthy cohort. And it passes the progressivity test because somebody making six figures will burn out that allowance in 2-3 years. Somebody having trouble getting on their feet will get more runway. It also helps younger people at exactly the point when they have the most expenses and the least income. Be that education debts, starting a business or saving for a home. You shouldn't be surprised if this is proposed.

And really, what's a voter like you going to do? Vote for the Liberals? Given the vote surge, the CPC has a generational opportunity here to supplant the LPC. They should absolutely take advantage of it.

[whatnext]

Interesting. A former provincial premier would at least be free of the taint of sitting in Trudeau's government...

Former B.C. premier Christy Clark calls for Justin Trudeau to be replaced
MARIEKE WALSH SENIOR POLITICAL REPORTER
BILL CURRY DEPUTY OTTAWA BUREAU CHIEF
OTTAWA
PUBLISHED 3 HOURS AGO

Former B.C. premier Christy Clark says Prime Minister Justin Trudeau needs to be replaced and suggested MPs begin having private conversations with the Liberal Leader about the party’s electoral prospects if he stays on...

... Beyond the leadership change, the former premier said the party needs to change its focus and lay out an economic agenda.

”This government hasn’t been focused on economic growth, we’re sliding back in our standard of living,” she said. “The Liberal Party of Canada has to get back to being a party of job creation and of fatter wallets for Canadians.”

She said that’s what the Liberal Party was about under Prime Minister Jean Chrétien and subsequent prime minister Paul Martin, and that people from that generation “want our party back.”..

....Ms. Clark worked on Mr. Chrétien’s 1990 leadership campaign, and again on his 1993 election. She then joined the government as a staffer.

Ms. Clark has been rumoured to be considering a federal leadership run but on Thursday said at the moment she’s not planning to run federally and noted that the position isn’t open. However, she added that she knows people want her to run...

https://www.theglobeandmail.com/poli...trudeau-to-be/

[YOWetal]

Originally Posted by Truenorth00

This is actually exactly what one of Harper's economic advisors suggested. He suggested making the first $250k of income tax free. He saw it as a way of counteracting the advantage of the land wealthy cohort. And it passes the progressivity test because somebody making six figures will burn out that allowance in 2-3 years. Somebody having trouble getting on their feet will get more runway. It also helps younger people at exactly the point when they have the most expenses and the least income. Be that education debts, starting a business or saving for a home. You shouldn't be surprised if this is proposed.

And really, what's a voter like you going to do? Vote for the Liberals? Given the vote surge, the CPC has a generational opportunity here to supplant the LPC. They should absolutely take advantage of it.

I was also thinking of this idea which has been mentioned by a few wonks. I guess the trick is it is only benefits Gen Z for the most part doesn't do anything for the 30-40 set most in need of help. My preference would be a population freeze combined with a first time home grant large enough to prevent a housing crash that would result if we really brought immigration and temporary residents to zero. This would cause a surge in wages and might be neutral for inflation or at least overcome by the slack being removed from general cuts.

Agree they can screw the boomers and they wont leave them.(not a boomer but play one on this forum)

[whatnext]

Originally Posted by Truenorth00

You seem to have missed the part where he chose to prioritize these refugees over those who risked their lives to work with Canadians and who our troops highly valued.

According to the G&M it wasn't just the Afghans who helped us whose escape plans were jeopardized but also actual Canadians :

..Then-defence minister Harjit Sajjan instructed Canadian special forces to rescue about 225 Afghan Sikhs after the Taliban takeover in August, 2021, in an operation that three military sources say took resources away from getting Canadian citizens and Afghans linked to Canada on final evacuation flights out of Kabul..

https://www.theglobeandmail.com/poli...uring-fall-of/

[Truenorth00]

Originally Posted by YOWetal

I was also thinking of this idea which has been mentioned by a few wonks. I guess the trick is it is only benefits Gen Z for the most part doesn't do anything for the 30-40 set most in need of help. My preference would be a population freeze combined with a first time home grant large enough to prevent a housing crash that would result if we really brought immigration and temporary residents to zero. This would cause a surge in wages and might be neutral for inflation or at least overcome by the slack being removed from general cuts.

Agree they can screw the boomers and they wont leave them.(not a boomer but play one on this forum)

An immigration cut won't actually help young people enough. They need a fundamental change in the balance and giving them a tax cut helps. Especially if it's them who are going to be getting hit with payments that benefit them (like CCB for example). A policy like this, could also help new immigrants. Simply put in a rule that says the first $250k is tax free, regardless of age, from your first filing.

[theman23]

Originally Posted by Truenorth00

An immigration cut won't actually help young people enough. They need a fundamental change in the balance and giving them a tax cut helps. Especially if it's them who are going to be getting hit with payments that benefit them (like CCB for example). A policy like this, could also help new immigrants. Simply put in a rule that says the first $250k is tax free, regardless of age, from your first filing.

Seems like an (massively) expanded FHSA, TBH.

[YOWetal]

Originally Posted by Truenorth00

An immigration cut won't actually help young people enough. They need a fundamental change in the balance and giving them a tax cut helps. Especially if it's them who are going to be getting hit with payments that benefit them (like CCB for example). A policy like this, could also help new immigrants. Simply put in a rule that says the first $250k is tax free, regardless of age, from your first filing.

Giving immigrantst the first $250k is the opposite of what we need. There should be a $500k fee for an economic immigrant creditable to your first 10 years of tax filings. The number of people coming in with no income maybe isn't our biggest problem but we still don't benefit much from a lot of the economic migrants.

I agree immigration cut isn't a panacea but neither is this most millenials have already earned $250k. They'll be bitter to be honest. Look at the reaction to student loan forgiveness.

[Truenorth00]

Originally Posted by theman23

Seems like an (massively) expanded FHSA, TBH.

I assume this would replace FHSA.

[YOWetal]

Originally Posted by theman23

Seems like an (massively) expanded FHSA, TBH.

This actually makes more sense. Increase FHSA limit to $40k a year. A lot of rich kids will get cash from parents to save their taxes but overall everyone who qualifies as a FHSA get's a huge tax break. It needs to be combined with something that pushes up supply. I guess hitting landlords isn't in the cards for Cons but phasing in 100% capital gains for investment properites and letting people quickly build up their FHSA could equalize things. It also focusses the tax break on those buying houses and those that have some cash as you still need to pay more than you invest of course. Gen Z won't have the cashflow. Or go really all in and add a grant.

[theman23]

The biggest disadvantage young people have is the drag from our exorbitant income tax rates and the inability to make up for that by accesing a lifetime unlimited TFSA i.e. the primary residence. Exorbitant tax rates are not new. A dramatically expanded FHSA or expanded (?unlimited) TFSA reserved for non homeowners would probably help level the playing field without pissing off too many boomers.

Or we could just slash income taxes.

[YOWetal]

Originally Posted by theman23

The biggest disadvantage young people have is the drag from our exorbitant income tax rates and the inability to make up for that by accesing a lifetime unlimited TFSA i.e. the primary residence. Exorbitant tax rates are not new. A dramatically expanded FHSA or expanded (?unlimited) TFSA reserved for non homeowners would probably help level the playing field without pissing off too many boomers.

Or we could just slash income taxes.

An unlimited TFSA helps them very little. They aren't exactly paying exhorbitant tax on their saving for a downpayment. Their problem is saving. Might be appealing to the Gen Z swing for the fences big wins mentality but isn't going to help much.

As for slashing income tax. The 1.5 % middle class cut costs $5 billion a year. So cut it 15% blow up the whole budget $50 billion and someone making $100K saves $675 a year. That's what many spend on Uber Eats which we are told has nothing to do with their inabilty to save. Nevermind those making less little to nothing.

[theman23]

The point would be to have them forget about ever owning a home and focus on growing their wealth. You would probably need people to make a choice maybe the by the age of 25 whether they want an unlimited TFSA or tax free primary residence cap gain to prevent people from gaming the system anyways. The latest cap gains tax increase only tilted things even more in favour of home owners so this would help balance that. As an added benefit, we may see Canadians start investing in things outside of real estate.

[Truenorth00]

The fundamental problem is simple. If you own your home, you're building equity in a massive tax shelter. If you rent, you have to put some of your after tax income (which you don't have much of) into some kind of savings vehicle. TFSAs, RRSPs, FHSAs, none of that helps people who don't make enough to save (after tax) faster than prices are increasing. Oh and rising rents are eating into their ability to save.

So there's only one obvious solution here. They have to get some kind of tax cut that existing homeowners (mostly older) can't access.

[Truenorth00]

Originally Posted by theman23

As an added benefit, we may see Canadians start investing in things outside of real estate.

This has to be a goal too. There's literally no way to stop our economic decline without reducing the dependency on real estate. Every problem we have, from terrible productivity to housing affordability stems from the dependency on real estate.

[Edmonton_Ian]

The haves and the have nots in Canada come down to if you own your house or not or at least the means to own a house if you so choose. Prove me wrong.

[theman23]

Originally Posted by Truenorth00

The fundamental problem is simple. If you own your home, you're building equity in a massive tax shelter. If you rent, you have to put some of your after tax income (which you don't have much of) into some kind of savings vehicle. TFSAs, RRSPs, FHSAs, none of that helps people who don't make enough to save (after tax) faster than prices are increasing. Oh and rising rents are eating into their ability to save.

So there's only one obvious solution here. They have to get some kind of tax cut that existing homeowners (mostly older) can't access.

You could level the playing field further by allowing renters to deduct their rent or providing a generous tax credit to renters, but that may drive up rent prices. Would have to be offset by a serious effort to increase rental supply and cut down on NPRs.

Honestly, the tax savings on the $250 k would all be plowed into real estate which is probably something we want to avoid.

[Truenorth00]

Originally Posted by theman23

You could level the playing field further by allowing renters to write off their rent. Honestly, the tax savings on the $250 k would all be plowed into real estate which is probably something we want to avoid.

This is actually a fantastic idea. Would help catch a lot of cash landlords too or at least pressure them to lower rents.

[YOWetal]

Originally Posted by Truenorth00

This is actually a fantastic idea. Would help catch a lot of cash landlords too or at least pressure them to lower rents.

Yes right now and even the one offs were only aimed at poor renters. Letting the Millenial making $80k part of their rent or a 25% tax break would be huge.

Honestly the only reason I don’t sell my Promary residence is the tax advantages a paid off property spits out. Ottawa real estate is likely to fall of a cliff once PP is elected.

[Truenorth00]

Originally Posted by whatnext

According to the G&M it wasn't just the Afghans who helped us whose escape plans were jeopardized but also actual Canadians :

..Then-defence minister Harjit Sajjan instructed Canadian special forces to rescue about 225 Afghan Sikhs after the Taliban takeover in August, 2021, in an operation that three military sources say took resources away from getting Canadian citizens and Afghans linked to Canada on final evacuation flights out of Kabul..

https://www.theglobeandmail.com/poli...uring-fall-of/

Even worse. His bias put Canadian lives at risk. I hope the Opposition drags him on this.