There’s little Canadians can do about whether President Donald Trump decides to follow through with his tariff threats, but we should demand our politicians don’t turn this potential economic emergency into COVID 2.0. Just a few short years ago, we saw what happens when governments use uncertainty and panic as an excuse to abandon all fiscal restraint, pad the pockets of chosen winners, and throw the middle-class and younger generations under the bus.
Unfortunately, there are indications that’s exactly what some Canadian politicians intend to do again. It appears they haven’t learned the hard lessons many Canadians did from the pandemic years about the importance of restraint, transparency, and the precision targeting of stimulus.
According to a report this week in the Globe and Mail, the federal Liberals are planning a “multibillion-dollar, pandemic-style bailout for businesses and workers,” should Trump impose tariffs. The same article quotes business leaders lobbying the Bank of Canada to “provide more liquidity”—effectively the same kind of money-printing that spiked inflation last time around—if tariffs hit.
Meanwhile in Ontario, Premier Doug Ford announced he will call an election for February 27 under the pretense that his government needs “a mandate from the people to fight against Donald Trump’s tariffs” and to spend potentially “tens of billions of dollars” in stimulus funding. Never mind that Ford’s Progressive Conservatives hold a stable majority, have a deficit of $1.5 billion, and telegraphed long before the tariff crisis that they’d prefer an early election to preempt any fallout from the federal Conservatives coming to power.
The costly charade reeks of the exact kind of early-election opportunism that Prime Minister Justin Trudeau indulged in back in 2021. Voters should by now recognize the warning signs of politicians who become too comfortable putting their personal priorities above those of the electorate they supposedly serve. The talk of spending tens of billions in stimulus without any accompanying details—Ford signalled he won’t release a fully costed platform—is also concerning from a government with a long track record of spending scandals, alleged insider wheeling and dealing, and lavish corporate welfare.
Not to be outdone, Quebec Premier François Legault promised to protect Quebecers “at all costs” as his government prepares a plan to support businesses and individuals based on how it responded during the pandemic. He will also no longer guarantee a balanced budget as planned by 2029-30.
Governments across jurisdictions and the political spectrum seem ready to repeat the same mistakes that just a few years ago led to runaway inflation, a worsened housing crisis, increased corporate consolidation, and a decimated small business landscape. The result was the big winners—often those closest to politicians’ ears and campaign coffers—got bigger. Meanwhile, the small guys, while they may have seen income relief, were ultimately sacrificed.
Just as Canada looks poised to finally move past soaring inflation, with the latest rate at 1.8 percent, politicians must be careful not to stoke it again with reckless spending that undermines the central bank’s monetary policy and floods markets with cash that ultimately drives excess demand. Inflation is a tax on workers who rely on income and savings, many of whom are still underwater from the last round of spiralling price increases.

A closed store front boutique business called Francis Watson in Toronto on Thursday, April 16, 2020. Nathan Denette/The Canadian Press.
Corporations, particularly Canada’s oligopolies, will undoubtedly use the tariffs as an excuse to demand handouts and favourable loans from politicians. However, they should remember how that worked out last time around. Businesses by and large did not use government funds to increase productivity, invest in innovation, or even protect jobs. Rather, money disappeared into vacuous voids with no accountability and often padded the pockets of executives and shareholders.
The “big three” telecoms, Bell, Rogers, and Telus, received more than $240 million in federal COVID-19 support alone via the Canadian Emergency Wage Subsidy (CEWS) before turning around and doling out over $5.5 billion in dividends. The CRA later penalized 185 companies for misusing CEWS funds, although the number of complaints about misuse far exceeds that number.
Meanwhile, the federal government handed out over $49 billion in interest-free loans to small- and medium-sized businesses that the auditor general said showed no “due regard for the value of money.” More than 77,000 ineligible businesses received loans, and many companies were unable to pay back their loans, with federal debt write-offs and forgiveness totalling more than $18 billion in 2023. In too many cases, loans didn’t save failing businesses but simply prolonged their pain and demise at the public expense.
Of course, the taxpayers whose wages funded these loans-turned-handouts aren’t entitled to any transparency or accountability about who the money went to, what happened to it, or why the government isn’t seeking repayment. To add insult to injury, it will be younger generations who didn’t benefit from these programs who will be stuck paying off our collective debt for years and decades to come.
This pattern repeated at the provincial level—Ontario’s auditor general found the province gave out at least $210 million in COVID-19 funds to ineligible businesses.
“Even in a crisis, systems should be in place to make sure that only eligible businesses receive taxpayer dollars, and program funds reach those who need it most,” read her report.
Before any government hands out stimulus this time around, they must heed her warning and prove to taxpayers that programs are both highly targeted and contain the appropriate checks and balances to avoid misuse and waste.
Any large-scale programs must have built-in public transparency—tracking where money is going and how it’s allowed to be used is the only way to prevent support programs from devolving into swamps of soft corruption. There must also be real enforcement and strict penalties for those who don’t play by the rules, which should clearly lay out how taxpayer money is to be used and what a business can and can’t do while receiving taxpayer support. Corporate welfare shouldn’t be treated as a right, but a rare privilege that comes with heightened scrutiny, expectations, and obligations to the public.
Trump’s tariffs may indeed require increased spending and some fiscal stimulus from the federal and provincial governments, but we can’t let our response to the crisis become another excuse to concentrate wealth at the expense of middle-class taxpayers and long-term economic health.