2025

The rise of the Bank of Canada is due to three concurrently running events. First, during the early 1800's, the banks proved that they were not capable of managing themselves. Their inability to responsibly manage their own industry led to several bank closures that embolden the people to place pressure on their legislatures to instead step in and regulate these industries through legislation. Second, somewhere along the way, Canadian farmers and businessmen lost their sense of responsibility and began consuming cheap credit and every time they went bankrupt, they looked to the government to bail them out. Finally, governments began enacting monetary policies which gave them access to cheap and easy credit to finance their own public projects. All three of these events created an environment which required the formation of a central bank.

During Covid, the Bank of Canada printed upwards of a half a trillion dollars, breaking the back's of hard working Canadians in the process. What started out as an institution which was, at least on paper, meant to ensure a stable money supply, has turned into a limitless line of credit for the federal government. Worse still, this destabilization of sound money has caused ripple effects, such as the fueling of the housing crisis as a hedge against inflation, which has left Canadians destitute, and thus more dependent on the federal government.

A state sovereign bank would address one of the issues associated with central banking, namely the selling of bonds to commercial banks and the interest payments they incur, however, it would not address the seeming inability of governments to limit their spending, particularly in the absence of any interest payments. Furthermore, central banks are no longer the only problem, as much of global debt has now shifted from government to corporate & household debt, therefore, addressing sovereign debt issues would not fully mitigate our current debt crisis. Nevertheless, a good starting point would be to remove the Bank of Canada's ability to print money. This could be achieved through an act of Parliament prohibiting the creation of new money or by linking currency to a physical commodity like gold such that any new creation would require raising taxes and purchasing that commodity on the open market. Alternatively, the central bank could pursue a policy of zero inflation, as Maxime Bernier has stated numerous times, which would have the same affect, but which would be regulated on the back end.