OTTAWA — After two years of pandemic-induced uncertainty, the federal Liberals are getting ready to deliver an updated spending blueprint in a 2022 budget that, by all accounts, has been influenced by fast-changing circumstances.
The result of a tumultuous few weeks is scheduled to be released Thursday, but experts note the uncertainty has not gone away.
High inflation rates may climb further. Unemployment is low, but labour shortages are widespread. Housing prices are rising at paces not seen in years.
And the war in Ukraine continues to send ripples through the global economy and threaten security.
A former Liberal budget director said the government should be careful how it earmarks billions in expected new spending with so many bumps on the economic road ahead.
Robert Asselin, senior vice-president of policy at the Business Council of Canada, says policy-makers never know what will happen and should be careful not to inflame key issues facing the country.
When Finance Minister Chrystia Freeland laid out the broad planks of this year’s budget in late January, she spoke about boosting the country’s economic potential, addressing housing affordability concerns, funding the transition to a green economy and minding high inflation rates.
Inflation rates then rose to a three-decade high in February, and prices have climbed further. The cost of living has become a top economic concern for Canadians, even though it has the effect of padding federal revenues as well.
Still, Asselin said, federal spending that adds to demand in the short term may only pour more gas on the inflationary fire.
“Spending this buffer that the economy is giving them … would be very irresponsible in my view because then you become less prepared for the next crisis,” he said.
The next crisis arrived at the end of February when Russia invaded Ukraine.
The fighting upended global security and created a new budget priority for the Liberals to boost defence spending along with other NATO allies.
On Wednesday, the Liberals voted in favour of a Conservative motion in the House of Commons that called on the federal government to increase defence spending to at least two per cent of Canada’s gross domestic product.
The motion, which did not include a timeline, passed 303-27, with NDP and Green MPs voting against it.
The impacts from the fighting in Ukraine reach beyond the defence budget, said Elliot Hughes with Summa Strategies, pointing to energy prices, geopolitics and international business decisions.
“Ukraine has essentially, in some ways, thrown the government a little bit off course and off schedule in their ability to pull together what I think is what’s needed … which is a well-thought-out economic growth strategy,” said Hughes, who worked as an adviser to Liberal finance and defence ministers.
The economy has fared better than anticipated over the past few months as it churned out growth and shrugged off the Omicron wave in January to see a quick rebound in job numbers.
That rebound along with higher oil prices is expected to pad the government’s bottom line and offset any new spending to be announced.
Some economists argue the Liberals shouldn’t pivot to austerity, noting pockets of weakness in the labour market for low-wage and older workers underneath positive headline figures showing an almost full labour market recovery from the onset of the pandemic.
The Liberals planned to use the jobs market to anchor budget decisions among other measures like a declining debt-to-GDP ratio, which Prime Minister Justin Trudeau pointed to Wednesday as a core guardrail on spending.
Alberta Finance Minister Travis Toews said spending anchors provide policy-makers with some stability in uncertain times, adding that keeping the debt-to-GDP ratio declining may also mean reining in some spending plans.
“Our economy’s operating at full capacity,” he said in an interview.
“I think there needs to be a real return to fiscal responsibility, some fiscal prudence in this budget.”
Budget priorities changed again just a few weeks ago.
The Liberals’ deal with the New Democrats to land that party’s support in key parliamentary votes committed the government to billions in new social programs.
The majority of the items in the deal were already reflected in Liberal campaign pledges that could amount to $48.5 billion in net new spending by 2026, said Rebekah Young, Scotiabank’s director of fiscal and provincial economics.
But promises for pharmacare and dental care, depending on how they are implemented, could add up to $20 billion more in spending over the three-year life of the deal, she said.
Trudeau didn’t give any hints about what measures might be in Thursday’s budget, but didn’t suggest the spending taps would be closed.
“The way the economy has come roaring back in Canada, stronger and faster than many other places in the world, is because we were there to support Canadians,” he said, “and we are making sure that we continue to be fiscally responsible.”
This report by The Canadian Press was first published April 6, 2022.
— With files from Mia Rabson
Jordan Press, The Canadian Press
Ex-Wildrose leader Danielle Smith reannounces UCP leadership bid as next step in Alberta politics – Global News
She thanked Kenney for the work he has done for Alberta’s energy industry and added she wouldn’t mind seeing Kenney stay on as premier until a new leader has been elected.
“I want to start off by thanking Premier Jason Kenney for all the work that he’s done over the last number of years.
“I’ve decided to jump back into politics, seeking the leadership of the UCP. That is just a continuation of my last political life,” Smith said.
Jason Kenney announces intention to step down as UCP leader
Smith spared no time getting into her platform, saying she will fix and restore faith in Alberta politics. She also said she will attempt to unite the UCP and pointed to the large number of people who registered to vote in Kenney’s leadership review.
“If you look at what happened during the UCP leadership contest, there were a lot of people who got brought into the UCP who had never been in politics before and I think that’s what has occurred,” Smith said.
“I think there has been a lot of division that has happened between friends and family, and we need to stop dividing people along identity lines… We are stronger united and that holds for our conservative movement as well.”
Smith also said she wants to see more people run in the leadership race and noted she respects the role of individual MLAs in Alberta politics.
“I would love to see Todd Lowen and Drew Barnes throw their name in the race for UCP leadership. We need to start unifying the movement again and that’s going to require all hands on deck over the next couple of years,” Smith said.
UCP caucus meeting to discuss future after Jason Kenney announces plan to step down
But Smith also spent time talking about her own credentials, saying she has a lot of experience as the former party leader for the Wildrose Party, which merged with the UCP in 2017.
She also talked about her time as a former radio host on 770 CHQR as proof she can “take the heat” in Alberta politics.
“I’m not going to enter a contest thinking I’m going to come in second place… This is a real opportunity for the UCP to make sure that we’re selling memberships, that we’re getting people excited again.
“I can handle the heat. I have handled it for a lot of years, and that’s the way I conducted myself on the radio,” Smith said.
© 2022 Global News, a division of Corus Entertainment Inc.
Politics Briefing: Canada banning Huawei from 5G network, federal ministers say – The Globe and Mail
The federal government is banning Huawei and ZTE from Canada’s 5G network, federal ministers announced Thursday.
The Liberal cabinet has been hinting for months that a decision was imminent.
Innovation Minister François-Philippe Champagne and Public Safety Minister Marco Mendicino made the announcement Thursday at a late afternoon news conference.
“Today, ladies and gentlemen, we are announcing the intention to prohibit the inclusion of Huawei and ZTE products and services in Canada’s telecommunications systems. This follows a full review by our security agencies and in consultation with our closest allies,” said Mr. Champagne.
Asked why it took three years to reach the decision, Mr. Champagne said “This has never been a race. This about taking the right decision.”
This is the daily Politics Briefing newsletter, written by Ian Bailey. It is available exclusively to our digital subscribers. If you’re reading this on the web, subscribers can sign up for the Politics newsletter and more than 20 others on our newsletter sign-up page. Have any feedback? Let us know what you think.
UCP MEMBERS CONSIDER NEXT STEPS AFTER KENNEY ANNOUNCES EXIT – Members of Jason Kenney’s United Conservative Party caucus gathered in downtown Calgary on Thursday to hash out who should lead them after the Alberta Premier said he would step down as leader but declined to provide a timeline.
KENNEY NOT EXTREME ENOUGH: LIBERAL CABINET MINISTER – A Liberal cabinet minister from Alberta says Jason Kenney is the latest conservative leader to be pushed out by party supporters for not being “extreme enough.” Story here.
SUPREME COURT HEARING APPEAL ON FORD GOVERNMENT MANDATE LETTERS – The marching orders that Progressive Conservative Leader Doug Ford first sent his newly elected cabinet ministers back in 2018 will remain secret past the next election, which is just two weeks away, now that the Supreme Court of Canada has agreed to hear the government’s appeal. Story here.
SASKATCHEWAN LEGISLATURE MEMBERS CITED FOR BAD LANGUAGE – Two members of the Saskatchewan legislature have been kicked out of the assembly over the language they used during Question Period and for refusing to apologize. Story here.
TWO ONTARIO PARTY LEADERS HAVE COVID-19 AMID ELECTION CAMPAIGN – Ontario NDP Leader Andrea Horwath and Mike Schreiner, the Leader of the Green Party of Ontario, have both tested positive for COVID-19, forcing changes in their plans to campaign during the Ontario provincial election. Story here.
LAST DAY OF ROYAL TOUR – Prince Charles and Camilla, Duchess of Cornwall, landed Thursday in Yellowknife, where they were to speak with First Nations chiefs on the final day of their royal visit that has focused on Indigenous issues and climate change. Story here.
INDEPENDENT BODY COMING FOR BORDER AGENCY COMPLAINTS – The federal Liberals are poised to rekindle a plan to allow travellers, immigration detainees and others who feel they have been mistreated by Canada’s border agency to complain to an independent body. Story here.
CONSERVATIVE LEADERSHIP RACE
CAMPAIGN TRAIL – Scott Aitchison is in the Greater Toronto Area on Thursday and through the rest of the week. Roman Baber has a virtual event. Jean Charest has meetings and virtual calls ahead of a visit to the Vancouver region, and the Vancouver Island communities of Nanaimo and Victoria. Leslyn Lewis is travelling, but has a virtual event. Pierre Poilievre has meet-and-greet events in Summerside and Charlottetown, PEI. There’s no word on Patrick Brown’s campaign plans.
ED FAST LEAVES HIS CRITICS ROLE – Ed Fast says party supporters of Conservative leadership prospect Pierre Poilievre made his position as the federal official opposition’s finance critic untenable, and that he wanted to leave the post to step up his efforts to help a rival to Mr. Poilievre’s leadership ambitions.
“There was an expectation from Pierre Poilievre’s supporters that the finance critic for our party not speak on any matters being raised by his campaign,” the Conservative MP from British Columbia, and co-chair of Jean Charest’s leadership bid, said in an interview on Thursday.
“And I felt that was irresponsible, and that I needed the freedom to speak freely when it comes to monetary policy.”
Mr. Fast has previously criticized Mr. Poilievre for promising to fire Bank of Canada Governor Tiff Macklem. Mr. Poilievre has accused the central bank of failing to effectively manage inflation. On Wednesday, Mr. Fast repeated that criticism of his caucus colleague.
He repeated his concerns on Thursday. “I have a bone to pick with one of my colleagues who is a candidate who is promoting a monetary policy that I feel is very wrong-headed and sends a terrible message to the global investment community.”
Mr. Fast said he had approached Interim Conservative Leader Candice Bergen some weeks ago with concerns about the critic’s role, and they agreed it was best for him to relinquish those responsibilities.
On Wednesday night, Ms. Bergen said in a statement that Mr. Fast told her he was leaving his post as finance critic, citing his desire to focus his efforts on supporting Mr. Charest’s leadership campaign.
Ms. Bergen said Mr. Fast remains a valued member of the team and caucus, and she would soon announce a replacement finance critic.
She appointed Mr. Fast as the party’s finance critic after Mr. Poilievre, previously the critic, decided to enter the leadership race.
Mr. Fast said his relationship with Ms. Bergen remains “top notch” and that he has great respect for her as she handles the difficult job of keeping the party together during a leadership race.
Mr. Fast said he is hopeful about Mr. Charest’s prospects despite massive crowds that have consistently showed up for Mr. Poilievre’s campaign rallies. “I would not be supporting Mr. Charest if I didn’t have full confidence that he has a clear pathway to victory and becoming the next leader of our country and the next prime minister,” he said.
Conservatives are in the midst of a leadership race prompted after caucus voted out Erin O’Toole earlier this year. The party is to announce the winner on Sept. 10.
There’s more here about Mr. Fast’s departure from the finance critics role.
TORIES INVESTIGATE RACIST E-MAIL – The Conservative Party of Canada says it’s investigating a complaint from the Patrick Brown campaign about a racist e-mail that expressed support for Adolf Hitler and Nazism. Story here from CBC.
THIS AND THAT
TODAY IN THE COMMONS – Projected Order of Business at the House of Commons, May19, accessible here.
SPENGEMANN DEPARTING – Sven Spengemann, the Liberal MP for Mississauga-Lakeshore, has announced he is leaving his role as MP to serve with the United Nations, effective May 28. “I will have more to say on my new role in due course,” the chair of the Foreign Affairs and International Development Committee said in a statement. Prior to his first election in 2015, Mr. Spengemann served as a senior official in Baghdad with the United Nations Assistance Mission for Iraq.
Thursday’s edition of The Globe and Mail podcast deals with the May 11 death of Shireen Abu Akleh, a prominent Palestinian-American journalist who was shot and killed in the West Bank while reporting for Al-Jazeera. Josef Federman is the news director of the Associated Press for Israel, Palestinian territories and Jordan. He’s on the show to explain what has been going on in Jenin, the city where Ms. Abu Akleh was reporting from when she died, what we know so far about who is responsible for her death and how the investigation is playing into an already heated conflict between Israelis and Palestinians. The Decibel is here.
PRIME MINISTER’S DAY
The Prime Minister held private meetings, and spoke to Swedish Prime Minister Magdalena Andersson. He also chaired the cabinet meeting and was scheduled to chair a meeting of the Incident Response Group on the war in Ukraine.
NDP Leader Jagmeet Singh delivered remarks at the LiUNA! Local 3000 Leadership Seminar in Toronto.
No schedules for other leaders released.
OPINION – JASON KENNEY
Gary Mason (The Globe and Mail) on the spectacular fall of Alberta Premier Jason Kenney: “And so here we are, with the province’s governing party once again in search of a new leader and an election a year away. Who knows who will emerge victorious? Former Wildrose leaders Brian Jean and Danielle Smith will throw their names in. Others in Mr. Kenney’s cabinet will too. Former federal Conservative MPs Rona Ambrose and Michelle Rempel Garner, both from Alberta, will be wooed. Of the two, I could see Ms. Rempel Garner possibly putting her hand up. She would instantly become the front-runner. However, whoever wins will have the same problem Mr. Kenney had when he took over: the UCP is an amalgam of two political philosophies, two ideological forces. They are often at odds.”
Rick Bell (Calgary Sun) on how Alberta Premier Jason Kenney never listened and now he’s out: “One night it hit me. He really didn’t really know Alberta politics. He had not learned a valuable lesson from the 2015 election when the PCs were thrown out on their ear. Alberta didn’t want the cronyism, the old boys in the saddle, the insiders making a pretty penny. They didn’t want the moral failure I call Toryland. But Kenney never listened. I write this column with some sadness and no pleasure. If Kenney had listened, if he had looked in the mirror, admitted there were things he could improve, offered a plan of how this one-man band of a government could become something better … If, if, if. A mug’s game. But instead he stuck to his script. He spent so much time defending himself he had no time to even consider what the people of Alberta actually wanted.”
Don Braid (Calgary Herald) on how Alberta Premier Kenney will resign leadership eventually, but doesn’t intend to leave: “There will be a leadership race. Kenney said it’s necessary. What he did not say is whether or not he’ll be a candidate. Nothing in the [United Conservative Party] rules would prevent him from resigning, and then running. There will be a struggle over whether the UCP edges more to the centre, or veers sharply to the right. Many of the MLAs who opposed Kenney prefer the latter. New MLA Brian Jean will run. Danielle Smith will likely join in, too. They’re well-known voices from the party’s past, but many members will want to move beyond the old merger struggles. Jobs Minister Doug Schweitzer’s name often comes up. So does Finance Minister Travis Toews. Other campaigns will take shape very quickly. Whoever happens next, this remains a dangerous moment for the UCP.”
Sean Speer (The Hub) on how a spirited minority of conservative partisans have come to define their politics in solely oppositional terms: “Jason Kenney’s swift resignation as United Conservative Party leader is a lamentable outcome for Canadian conservatism. It reflects the rise of an oppositional mindset on the Right that is bad for Conservative politics and the country as a whole to the extent that it marginalizes centre-right ideas and policies and enables progressives to govern essentially unchecked. Alberta’s Kenney-led government wasn’t perfect – no government ever is – but it was the country’s most ambitious centre-right provincial government since the Harris government’s Common-Sense Revolution in Ontario more than a quarter-century ago.”
Lawrence Martin (The Globe and Mail) on Justin Trudeau’s advantage: His house united, the other divided: “Recall the drawn-out dagger fest between Jean Chrétien and Paul Martin; Mr. Chrétien’s never-ending conflict with John Turner; the furor touched off by then-finance minister Mr. Turner’s flight from Pierre Trudeau’s cabinet in 1975. There were schisms in the party over paramount issues such as free trade and the Meech Lake accord. Later came despair and disunity under the anemic leaderships of Stéphane Dion and Michael Ignatieff. But what now? Today, there’s not much of that. Rarely a peep of protest from within the ranks. No big divide in the party on the major issues of the day. No one openly challenging the leadership of Justin Trudeau despite his losing the popular vote in two straight elections.”
Robyn Urback (The Globe and Mail) on how Ontarians don’t fear Doug Ford the way they did in 2018: “Some time between 2018 and 2022, then, the Ford fear factor must have evaporated from Ontario’s public consciousness. No doubt many Ontarians still detest or dislike Mr. Ford, but the province doesn’t appear to fear him the same way it did just four years ago. The question is, over the past four years, did Mr. Ford change, or did we?”
Michelle Rempel Garner (National Post) on the duty to reject conspiracy theories about white replacement: “With Canadian politics becoming more divisive and polarized every day, this dogma can’t be ignored. It must be vehemently, and pro-actively, denounced and stopped. This is particularly true for leaders in right leaning political movements where this sentiment may be more pervasive, and the temptation to mainstream it for political gain is greater. Promoting it or being silent when it occurs in the ranks amounts to the same thing.”
Canada's Left Shouldn't Abandon Electoral Politics – Jacobin magazine
A survey of the Canadian political landscape reveals a foreboding terrain. Across the country, right-wing governments lead most provinces with centrists making up all the rest, save for one New Democratic government in British Columbia. Even there, the New Democratic Party (NDP) is constrained by state and electoral orthodoxy. Their governance is better than the typical alternatives, but far from ideal.
In Ontario, after four disastrous years of pandemic mismanagement, market orthodoxy, and underspending, Progressive Conservative premier Doug Ford appears to be sailing toward reelection, perhaps with a majority of seats in the legislature once more. The NDP Official Opposition may drop to third place as the Liberals rebound in the polls. The Liberal government in Ottawa, with support of the federal New Democrats, looks likely to remain in power at least until 2025.
At a time when we are routinely reminded that the old ways are insufficient for dealing with the problems we face, the Left appears to be MIA. The federal NDP bought themselves some policy influence by way of their supply and confidence agreement to support the Liberal minority government. Nonetheless the political agenda in Canada remains fundamentally conventional and devoid of energy. The programs that follow, federally, provincially, and locally, are anemic half-measures that are barely capable of forestalling angry populist requital.
When they do exist, these programs are typically means-tested and often underfunded, from the upcoming dental care to disability supports. Austerity, the watchword of 1990s retrenchment, remains standing as a lighthouse in the distance, a point on the horizon to guide the ship of state. Wages and worker rights are decoupled from productivity and little is happening to transform relations of power in industry — including the essential need to transfer ownership from bosses to workers, despite a new employee ownership model for the country. Climate action is insufficient, resource extraction and export are nearly always a given.
Reviewing this state of affairs in Canada — and, more broadly, in the electoral history of the Left — it’s tempting to wish to abandon electoralism as a strategy for change. Such talk comes up in breathless critiques of the NDP, hands thrown up in the air, heads hung low and shaken slowly from side to side. The urge to flip the table and walk out of the room is strong. And understandable. Nothing seems to be working. The focus-grouped, TikTok-brushed, consultant class–led strategy isn’t working. What is to be done?
A Sober Theory of Change
The twentieth-century left had a revolutionary impulse that, to whatever extent it existed in Canada, has been dampened to near silence. The Bolshevism — and even the more moderate socialism — of movement and party leftists has disappeared or gone underground. Some have joined the Communist Party. Others have given up. Many have fallen into the NDP machine. Some hang on, driven to the sidelines of the party. The pervasive discontent creates a counter-impulse that counsels the abandonment of the ballot box. But this impulse should be thought through carefully. In the absence of electoral politics, what is our theory of change? Do we then rely on revolution? On mass struggle through civil society? One thing is for sure: decamping from the electoral milieu is to entirely relinquish the field to capital’s most canny operators.
A theory of change that rests on revolution in a twenty-first-century democracy trapped by the comforts of its liberalism, next door to the global capitalist hegemon, is not a theory of change. Likewise, relying on extant infrastructures of opposition outside the ballot line — unions, associations, organizations — is insufficient for the needs of the moment.
If, at present, this infrastructure is incapable of moving the party left, why would it do better in the absence of the party? Some will answer that such a move will short-circuit the ossifying forces of bureaucratization. But bureaucratization is an outgrowth of complex society. It isn’t going anywhere. Of course, at its worse, bureaucratization can create calcified forms of organization. But we should be careful about priorities here. The most effective way to battle against capital is the thing that matters. Handwringing about the bureaucracy required by the complexity of the modern state is less important than using the power of the state to beat back the market’s encroachment into all aspects of our lives.
Giving the Boot to Technocrats
For those who look to the years of the Co-operative Commonwealth Federation, the radical prairie socialist NDP forebear, a return to previous form holds some promise. So does a more coherent two-track approach that commits electoral politics to an agonistic relationship with grassroots movements. It is crucial that these grassroots movements are separate from but sympathetic to the party.
We should double down on our efforts to force the NDP to stay abreast of the moment. The latent energy that is not being applied to electoral politics should be applied to ensuring that the NDP embraces socialist politics — and is unapologetic about it. The party should be forced to adopt a more democratized apparatus that ensures that radicals have a place to speak, to be heard, and to be listened to, from the convention floor to the riding association board room. That means less time for the consultants and the ad engineers. It means less time strategizing around social media quick-hits that produce plenty of adrenaline and staffer high-fives but next to no votes.
The party needs to be supported by a more robust external apparatus, too. This will require more cooperation with unions, tenant’s associations, academic support, think tank scaffolding, as well as international cooperation. These structures and relationships exist already, but they are insufficient and restrained.
Furthermore, they are confused and confounded by a politics that is caught between technocratic contemporary social democracy and grassroots democratic socialism. The two forces sometimes pull in the same direction, but oftentimes in opposite directions — and when they pull at cross-purposes, they fail to pull at all. The NDP needs to mobilize democratic socialists, bringing them inside the party and putting them to work.
Re-Radicalizing Party Politics
Outside the party, the NDP needs to listen to and better leverage grassroots organizations to both respond to and help shape a true mass politics. On worker rights, drug policy, housing policy, environmental policy, health care policy, Indigenous reconciliation, and plenty more, left movements are charting a course the party ought to champion. Instead, far too often, because of its commitment to technocratic tinkering, the NDP de-radicalizes its politics ahead of time.
The party prefers to rely on muscle memory that tends toward incrementalism, or a naïve belief that Canadians simply aren’t ready for more and better. But this presupposes that the big wins and structural shifts we need will come without a fight. The Left needs to remake the country, reset its agenda, and reframe how we talk about politics. It needs to do so while raising a generation of Canadians committed to building a new world. The party, because it is instrumental in raising expectations as to what is possible, is key to the success of this endeavor.
In the absence of electoral politics, no force implements change at the state level. Elector politics is the connective tissue between desire and outcome. But electoralism is insufficient on its own and no party, left or otherwise, is to be trusted without an external series of forces. It requires that labor, civil society, and intellectual apparatuses work to keep it honest. By the same token, insurgent popular actions are important, but they can’t replace the party.
We must criticize the NDP. We must demand that the party do better. The party must be forced to commit to a radical politics that is unabashedly, unapologetically socialist and grassroots. The alternative is more of the same: more disappointment, more half-measures, more waiting. It is a chicken and egg scenario: the longer we fail to leverage the party’s potential, the less appealing electoral politics will be and the more inclined we will be to squander one of the most important quivers in our bow. The challenges we face must be met — we cannot settle into decline and hopelessness. So, best to get moving now.
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