Hub Podcasts There's a big gap between rhetoric and reality in Budget 2025
Nov 6, 2025
Trevor Tombe, a Professor of Economics at the University of Calgary, critiques Budget 2025, highlighting the disparity between its investment promises and reality. Mike Moffatt, the founding director of the Missing Middle Initiative, discusses the lackluster housing measures and the shift towards immigration-driven demand-side solutions. Christopher Ragan, an economist at McGill University, offers insights into the budget's modest fiscal stance and warns of potential risks regarding deficits and defense spending commitments. Tune in for a deep dive into budgetary realities!
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Rhetoric Vs Reality On Investment
- The budget promises a $1 trillion investment push but delivers mostly incremental changes, not generational spending.
- Trevor Tombe argues only about $8.3 billion of new capital spending is truly additional, making the claim misleading.
Temporary Super-Deduction Limits Long-Term Gain
- The productivity 'super-deduction' lets firms immediately expense many capital investments, sharply lowering tax on new manufacturing investment.
- Tombe notes this could boost GDP modestly (~0.2%) but is temporary, muting long-term impact.
Deficit Path Hinges On Tough Spending Review
- Large projected deficits persist and the government plans to miss its fiscal anchor for several years, relying on an extensive expenditure review to hit targets.
- Tombe warns these savings require rare multi-year discipline and are uncertain.