Liberal leadership hopeful Mark Carney says he'd run a deficit to 'invest and grow' Canada's economy

Liberal leadership hopeful Mark Carney confirmed Sunday that a federal government led by him would run a deficit "to invest and grow" Canada's economy, but it would also balance its operational spending over the next three years.

Carney, a former governor of the Bank of Canada, invoked U.S. President Donald Trump's ongoing threat of sweeping tariffs on Canadian goods to justify his proposed deficit.

The intent, Carney said during an interview on Rosemary Barton Live, is to invest in Canada's economy "at a time when we absolutely have to build as a country."

The taxpayer dollars would "catalyze many multiples of private dollars" to build homes, energy infrastructure, AI systems and trade corridors — "all of which are fundamentally necessary if we are going to grow this economy, irrespective of how President Trump is feeling on one day or another," Carney said.

Carney also said a federal government led by him would balance its operational spending — such as government-run programs, federal transfers to provinces and territories and debt service charges — over the course of the next three years. 

"Where we are willing to borrow is to invest and grow this economy," Carney told Barton. "That is an absolutely crucial point."

WATCH | Carney says he'd assess tariff situation before calling a federal election if he's PM:

Carney says he would assess tariff situation before calling an election

8 days ago

Duration 1:29

Liberal leadership candidate Mark Carney, speaking from Vancouver on Thursday, said 'nothing is pre-wired' when asked whether he would call an election right away if he wins the party leadership race.

The former central banker also discussed his views on several other economic objectives. Carney said he supports "the concept" of a west-east oil pipeline  — an idea that's regained steam from some federal cabinet ministers and Conservative Leader Pierre Poilievre.

"We as a nation need to build some new pipelines for conventional energy," Carney said. He added his government would accelerate approvals for such pipelines and for clean energy.

Canada is also making a push to dismantle interprovincial trade barriers. Carney said he would "quickly convene" the country's premiers to work on the issue in the service of making "one economy here, not 13."

Carney, Trump and getting into politics

Looming over the Liberal leadership race is Trump's tariff threats and continual talk of annexation, raising the stakes for the federal government as it works to stave off a trade war with the United States.

Carney, who may manage those negotiations in just a few weeks if he wins the leadership race, said he would pick up discussions "where they are" upon taking office.

When asked why he's being reticent to share details of how he would respond to Trump's tariffs, Carney said it's "not a good idea to insert yourself in the middle of a negotiation [and] give conflicting signals."

So far, Carney has pledged dollar-for-dollar retaliatory tariffs — as has his main leadership opponent, former finance minister Chrystia Freeland.

Should Carney win the leadership race, he would become the first person to become prime minister who's never held an elected office.

Carney said he first needs to be elected Liberal leader, and he took credit for his role in growing the number of party members. At the end of January, the Liberals announced nearly 400,000 people had registered to vote in the leadership race.

"So members of the Liberal Party ... will decide who they want as their leader, and I'll be elected or not by those individuals," Carney said.

"Then Canadians in short order will get a decision whether or not which government they want to return to Ottawa."

Carney also said former prime minister Stephen Harper asked him to be finance minister in 2012, but he "didn't feel it was appropriate to go directly from being governor into elective politics."

WATCH | Conservatives target Carney as polls show Liberals picking up more support:

Conservatives target Carney as resurgent Liberals make gains in the polls

6 days ago

Duration 2:01

The Conservative caucus met in Ottawa to talk strategy as the party's once-overwhelming lead over the Liberals erodes amid new interest in leadership front-runner Mark Carney and concern over U.S. tariff threats.

Harper's former director of communications, Dimitri Soudas, said in a statement to CBC News that "Mark Carney is not telling the whole story, and prime minister Harper certainly does not support Mr. Carney in any way."

Carney, who was previously tapped by Prime Minister Justin Trudeau to chair a Liberal Party task force on economic growth, was also asked why Canadians should believe he'd do anything differently than the outgoing prime minister.

"I focus on the economy," Carney said in response. "[Trudeau] has had a different focus for Canada.

"Why am I here now? Because we're in a crisis," he said. "For better or worse, my career [and] my experience prepares me for this moment."

Upcoming financial deadline

So far, five candidates remain in the race to replace Trudeau. In addition to Carney and Freeland, who served as both finance minister and deputy prime minister, they include: Karina Gould, former House leader; former Liberal MP Frank Baylis; and Ruby Dhalla, also a former Liberal MP.

All five candidates must pay a final instalment of $125,000 by 5 p.m. on Monday to stay in the race and participate in the English and French debates, which are scheduled to take place in Montreal next week.

Carney's campaign has told CBC News it will pay the final instalment on Monday. Freeland's campaign confirmed to CBC News on Sunday afternoon that it's already made the payment.

Also on Sunday, Gould's team told CBC News that it made the payment four days in advance of the Monday deadline.

Baylis's campaign told CBC News on Sunday afternoon it submitted the final deposit to the Liberal Party on Friday, while Dhalla's campaign said in a statement to CBC News sent Sunday afternoon that she will make the final deposit on Monday.

The Liberal Party will choose its next leader — and Canada's next prime minister — on March 9.