Farmers and small businesses worried about Federal Debt Crisis

Oct 30, 2024
By Jean-Paul McDonald
Assistant Editor, North American Content, Farms.com

Canadians are demanding a Budget Balancing Plan

Nearly 74% of Canadian small businesses express concern over the federal government’s lack of a concrete plan to balance the budget, as deficits and federal debt continue to rise, reports the Canadian Federation of Independent Business (CFIB). These sentiments are also held by many growers across the country.

The federal debt has almost doubled in the last decade, increasing from $602.4 billion in 2012/2013 to $1.173 trillion by the end of the 2022/2023 fiscal year.

“The federal government must introduce a timeline to balance the budget. Our economy and our entrepreneurs cannot sustain this level of debt forever. Too much money is spent to manage our debt. That’s money that could instead be used to reduce taxes and the cost of doing business,” said Jasmin Guenette, Vice-President of National Affairs at CFIB. “Ottawa needs to stop acting as if it has money to burn and, instead, work to avoid driving up the national debt.”

Currently, the entirety of Canada’s annual goods and services tax (GST) revenue scarcely covers the $54 billion spent on interest payments alone.

This amount is comparable to the combined provincial budgets of Manitoba, Saskatchewan, and Newfoundland and Labrador for 2024/2025.

Projected figures suggest that by 2028/2029, debt servicing costs could reach $64.3 billion, equal to the combined elimination of the GST, energy taxes, import duties, and excise taxes for 2022/2023.

Guenette highlighted the drawbacks of tax increases, stating, “Increasing taxes is not a sustainable solution. It’s well beyond time for the government to get its fiscal house in order.” CFIB has proposed a number of strategies, including:

Establishing a defined path for budget balance with clear indicators.
Adopting a fiscal anchor that actively reduces both the deficit and the debt.
Implementing legislative spending limits, excluding crises.
Conducting internal reviews to reduce the size and cost of the federal public service.
Freezing departmental operating budgets at current levels.
Limiting new or expanded social programs.
Selling select government assets like Crown corporations, land, and buildings.

“Farmers know that today’s deficits result in tomorrow’s new or higher taxes. Recurring deficits deter future entrepreneurs from entering the market and current ones from making the investments to grow their businesses. Canada must curb its spending tendency and implement solid fiscal anchors to help keep spending in check. The upcoming Fall Economic Statement and 2025 Budget is a great opportunity to start,” said Juliette Nicolaÿ, CFIB’s policy analyst and co-author of the analysis.

Photo Credit: Pexels Weekend Player

Video: The 15-Year Bet Behind Every New Variety!

Canada is trying to decide how much agricultural research capacity it can afford to lose. Brian Rossnagel believes the better question is whether the country can afford to rebuild it.

The longtime barley and oat breeder makes the case with a simple fact about his profession: the consequences of today’s decisions may not become visible for 10 or 15 years.

“Pick the right parents. That’s the biggest thing,” Rossnagel says. “If you pick the wrong parents, you’re not going to get anywhere—and you don’t know that until 10 years, 15 years later.”

That warning carries particular weight as Agriculture and Agri-Food Canada moves to reduce spending and streamline parts of its science operations. The department’s 2026–27 plan anticipates the loss of approximately 665 positions by 2028–29 and says some research will be reduced where capacity exists in academia or industry. AAFC says the changes will make its science operations more cost-effective over the long term.

For Canada’s seed industry, Rossnagel’s career illustrates what is at stake.

This fall, the retired University of Saskatchewan breeder will be inducted into the Canadian Agricultural Hall of Fame. During his 35-year career at the Crop Development Centre, he helped develop more than 100 barley and oat varieties, including CDC Austenson—one of Western Canada’s most widely grown feed barleys. His induction recognizes not only those varieties, but the collaboration and research system that made them possible.

Rossnagel is quick to emphasize that none of it was the work of one person.

“The first thing I thought about was all the other people who contributed to whatever success I and my program had over the years,” he says. “We know that it’s not an individual who does this. It’s a group—a team.”

That team extends well beyond the breeder whose name appears beside a variety. It includes technicians, pathologists, quality specialists, statisticians, regional testing sites, seed growers and industry partners. It also includes the breeders who came before and those who will carry the germplasm forward.

CDC Fraser barley, for example, moved through three breeding careers. Its parents came from Brian Harvey’s program. Rossnagel advanced the material after Harvey retired, and Aaron Beattie later guided it through registration and release.

That kind of handoff is normal in plant breeding. The person who makes the original cross may never see the resulting variety reach farmers.

It also explains why lost research capacity cannot simply be switched back on when budgets improve.

“If you shut it off, it’s very, very difficult—and particularly costly—to start it up again,” Rossnagel says. “If you have to start from scratch, it’s going to be at least 10 years before anybody notices whether you’re getting anything done or not.”

The concern is not simply how many experimental lines Canada can process. Modern equipment, statistical tools and genetic technologies allow today’s breeding programs to evaluate tens of thousands of lines—far more than Rossnagel could handle when he entered the field in the early 1970s.

But efficiency and automation do not generate every idea.

“If you pare back down, and instead of having six or seven individual scientists concentrating on wheat breeding, you go down and say three people could handle all this, well, that’s half the ideas gone,” he says. “Particularly if you happen to lose the three people who had the really neat and innovative ideas, boy, that’s a problem.”

It is a timely distinction for Canadian agriculture. Consolidating programs may preserve the volume of material moving through a system, at least initially. It may not preserve the diversity of thinking, regional knowledge or willingness to pursue unconventional crosses.

That regional knowledge matters because Canadian agriculture is not one uniform production environment. A variety suited to southern Alberta may face different disease, moisture and maturity pressures than one grown in Manitoba, Ontario or Atlantic Canada.

“Agriculture is applied biology,” Rossnagel says. “Biology, all around the Earth, moves from the poles to the equator. It does not move from Newfoundland to B.C. like politics do.”