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That leaves it to us to try to reconcile these opposing readings of the Trudeau government's fiscal policies. Let me so defend the government against its progressive opponents and its own absurd spin on "fiscal restraint," as Finance Minister Chrystia Freeland phrased it in her 2023 budget statement.There is nothing constrained about the government's fiscal policy, unless the term has taken on such a broad definition that it is effectively useless as a description of government budgeting. Despite the claims of its opponents and supporters, the Trudeau government is unquestionably the most expensive in modern Canadian history.The COVID outbreak undoubtedly complicates an examination of the government's fiscal performance. The huge increase in federal spending—nearly 80% between 2019-20 and 2020-21—must be justified. Even if one disagreed with the scale of overall pandemic spending or specific spending decisions, it is reasonable to assume that any government would have raised program spending and run financial deficits in reaction to the pandemic.Fiscal forecasts beyond 2020-21 are still simply projections, and the government may overshoot. It has a lengthy history of increasing spending and the magnitude of the deficit as the budget's out-year predictions approach the present. The 2023 budget, for example, changed the government's previous prediction of returning to a surplus in 2027-28. The Parliamentary Budget Office's analysis now estimates that it could happen by 2035. The point here is that there's considerable cause to believe that current spending predictions for 2023-24 and beyond will be revised upward in the coming years.

Despite these restrictions, we can look backwards. 

and forwards to assess the Trudeau government's fiscal strategy and the conflict that has persisted in how it has spoken about spending, deficits, and debt.Let's start with program spending before the pandemic. It increased by an average of 6.2 percent per year during the Trudeau government's first four years in power. This contrasts with the Harper government's last four years, during which program spending fell by an average of 0.9 percent per year (see Figure 1).Janice Nelson created the graphic.Then there's the pandemic response, which pushed federal spending to record heights. Consider this: the 2020-21 deficit was more than 10% greater than the total federal budget during the Harper government's final year. Another way to look at it is that its predecessor could have received no money in its final year in office and still had a lesser deficit than the one recorded in 2020-21.Emergency spending as a proportion of GDP reached 18.5 percent that year, matching the G-7 average (see Figure 2) but ranking among the highest in the world, including comparable jurisdictions such as Australia, New Zealand, and the United Kingdom.Janice Nelson created the graphicThe government's post-pandemic predictions show program spending declining relative to a pandemic-induced high, but it's worth noting that it doesn't completely return to pre-pandemic levels. Following an almost 80% spike in 2020-21, the government expects an approximately 25% decrease over the next two years before it restarts growth. A large portion of pandemic spending has simply become part of the government's continuous expenditure baseline.

As I explained in a previous Hub article.

if the pandemic had never occurred and the government had continued to grow spending at a rate of about 6% per year as it had before the pandemic, program spending in the current fiscal year could be up to $45 billion lower than projected (see Figure 3). Such back-of-the-envelope analysis gives an idea of how much the pandemic spike has shifted the government's pre-pandemic trajectory.Janice Nelson created the graphicAs previously said, there is ample cause to be dubious of the post-2023-24 estimates. They foresee a level of expenditure restriction that the government has never demonstrated. They've also undergone significant changes in the last 16 months.Consider this: between the 2022 Budget, the 2022 Fall Economic Statement, and the 2023 Budget, estimated program spending in 2024-25 increased by over $25 billion (see Table 1). To put it another way, the government's own prediction for program spending in 2026-27 has been pushed up three years to 2024-25 during the last two budgets. Even if one is willing to give the government some leeway owing to pandemic uncertainty, it is difficult to justify so much movement—particularly in the latter years—over such a short period.Graphic credit: Janice NelsonThese data indicate that, as the outer years approach, the government's own spending predictions are likely to increase. The mix of remaining policy needs, political exigencies, and ideological preferences clearly points to increased expenditure, deficits, and debt in the next years.

The Trudeau government's spendthrift assumptions.

were clear from the start, and they remain so now. The only people who can't see it right now are those who are blinded by ideology or party. The government may as well embrace it. The rest of us did. The following is the newest episode of The Hub's new series The Business of Government, hosted by award-winning journalist and best-selling book Amanda Lang, which explores how government works and, more significantly, why it sometimes fails. In this five-part series, Lang conducts in-depth interviews with academics and past policymakers, putting everything into context for the common Canadian. Listen to the accompanying conversation with Michael Hallsworth, managing director of BIT Americas, on your preferred podcast app or at The Hub.Remember the nudge policies?Nudging became popular in the 2000s, although it was not part of the behavioral science toolbox. The concept was that governments may influence citizens' choices and behaviour through subtle or even unconscious messages.They could use some of our human impulses to achieve their goals, such as encouraging organ donation by requiring people to opt out rather than opt in. Marketers today make extensive use of behavioral psychology, such as increasing sales of the double patty hamburger by providing a triple patty because the double suddenly appears to be a wise decision.A few decades later, governments continue to deploy such techniques, but as behavioral insights mature, they are now being used to better understand their own internal systems and processes.