Veteran economist Don Drummond has advised federal and provincial governments on the best ways to keep public spending under control. Now that all three major parties have released costed platforms, he sees a common point of concern: further increases to the national debt – and no clear plans to pay for it.
The NDP was the last of the three main parties to release a detailed costing on Saturday.
The Globe’s Politics Briefing asked Mr. Drummond, who is adjunct professor at the School of Policy Studies at Queen’s University, for his assessment of the three fiscal plans now that their numbers are public.
“They are of like mind in taking the pandemic debt, adding to it, stuffing it in a box, gift-wrapping and passing it onto future generations,” he wrote in a detailed e-mail response. “They implicitly answer the question: Who should pay for this extraordinary fiscal intervention? Someone, way, way into the future.”
Another common element of concern for Mr. Drummond is that new spending promises are rarely linked with specific explanations for how the measures will be funded, either through tax increases or a spending cut elsewhere. He notes the NDP does list a wealth tax as a source of revenue, but the party also counts on further deficit spending.
On tax policy, Mr. Drummond says he sees a lot of bad ideas, pointing to Liberal pledges to impose higher corporate tax rates on banks and insurance companies with profits above $1-billion. The NDP plan includes raising the corporate tax rate for all corporations by three per cent.
“All fiscal studies show the corporate income tax has the highest economic cost. And its all the worse when it is applied selectively,” he said. As for the NDP’s wealth tax, Mr. Drummond said the goal of taxing the wealthy would be better achieved by focusing on income and reducing deductions.
“Despite many differences, they all feature similar philosophies: Push the risk curve by building up even more debt and hope someone, somehow, can deal with it way into the future. Maybe that will all turn out well. But with risk, one does not know, and that is the point. The next generation may have their hands full with other issues on top of dealing with our debt.”
This is the daily Politics Briefing newsletter, written by Ian Bailey. Today’s newsletter is co-written with Bill Curry. 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 signup page. Have any feedback? Let us know what you think.
THE FINAL WEEK
There’s only a week left before voting day on Monday Sept. 20, and the campaign is clearly taking on a more negative tone.
Conservative Leader Erin O’Toole and Liberal Leader Justin Trudeau both opened their news conferences Tuesday with lengthy criticisms of each other.
This change in tone can also be seen as the volume of paid advertising increases. The Conservatives are running ads criticizing Mr. Trudeau. The ads end with the tagline: “We can’t afford more of the same,” and state that Mr. Trudeau puts his own interests first. The Liberal attack ads borrow from Mr. Erin O’Toole’s party leadership slogan “Take Back Canada,” warning that Conservative policies will “take Canada backward.”
The NDP have also been running ads that criticize Mr. Trudeau, using the tagline “Justin Trudeau is all talk, no action.”
Jody Wilson-Raybould is calling on the Liberal government to remove roadblocks to a long-standing RCMP inquiry into possible obstruction of justice, and said she is not surprised that Liberal Leader Justin Trudeau denied urging her to lie about a pressure campaign to subvert the criminal prosecution of SNC-Lavalin.
Some high-ranking Ontario politicians and prominent health-care organizations are issuing warnings ahead of a number of protests expected to take place at hospitals across Canada on Tuesday. Story here.
Lisa Robinson, who was dropped by the Conservative Party as a Toronto-area candidate over the weekend, says she never wrote the online posts that led to her dismissal and that she’s gone to the police because fake posts continue to appear under her name online.
Now that all three main parties have released have released the costing details of their party platforms, the University of Ottawa’s Institute for Fiscal Studies and Democracy, led by former parliamentary budget officer Kevin Page, has provided an assessment of the three plans. The Globe story is here.
Bloc Quebecois Leader Yves-Francois Blanchet, in Gaspé, Grande-Vallée,Sainte-Anne-des-Monts and Rimouski, has a campaign day that includes a media availability on the appointment of judges. He will also meet with the mayors of Gaspé and Grande-Vallée.
Conservative Leader Erin O’Toole made an announcement and held a media availability in Carp, Ont., where he highlighted his party promise to allow parents to earn an additional $1,000 per month without causing a deduction in their maternity or parental leave. Mr. O’Toole is also scheduled to hold a virtual telephone town hall for Ontario voters and one for British Columbia voters.
Green Party Leader Annamie Paul is making a rare campaign stop outside of Toronto Centre, where she is on the ballot and has spent the vast majority of her time. On Tuesday, she is in Prince Edward Island to attend a University of P.E.I. student barbecue, and has a scheduled news conference with Green Party candidates. She was also scheduled to tour an organic farm, attend a Toronto Centre all-candidates meeting via Zoom, and attend a pep rally.
Liberal Leader Justin Trudeau made an announcement in Vancouver, focused on the party’s health care pledges.
NDP leader Jagmeet Singh held a news conference in Sioux Lookout, Ont., and visited the Neskantaga First Nation.
David Parkinson (Globe and Mail): asks who will pay for all of the deficit-financed spending that is the foundation of the platforms from all of the major parties: “No one is saying that paying off hundreds of billions of dollars in pandemic debt would be easy, painless or quick. But no one is even talking about trying. Even the concept of reining in the deficit is being kicked well down the road – meaning years more of adding on to the debt pile.”
Jody Wilson-Raybould (Contributor to The Globe and Mail) on her professional relationship with Liberal Leader Justin Trudeau: “I know the Prime Minister had always considered me a bit of a challenge – not political enough, too independent-minded, and ultimately not part of the inner Liberal crowd. I think I was foreign and incomprehensible to him. After all, I was from the other side of the tracks. I was an Indigenous girl from a small fishing village – Cape Mudge, on the southern tip of Quadra Island just off Vancouver Island. I am Kwakwaka’wakw. The PM did not grow up in my neighbourhoods, with the kids I grew up with. None of his family went to residential schools. My childhood memories are closer to Comox and Cape Mudge than Rockcliffe. My political point of reference was the Big House, not the House of Commons. To be fair, he did not choose how and where he grew up or who his parents were. But Liberals? Political parties? Not my world.”
Chris Selley (National Post): says Erin O’Toole’s pitch that he represents a new Conservative Party could lead to problems with core supporters if his bid for middle-of-the-road voters fails: “The party’s traditional base – the one that in March voted down a motion simply to “recognize that climate change is real” – is still a force to be reckoned with. And it’s likely to be all the more furious, all the more prone to fracturing, if O’Toole doesn’t manage to win. Polls currently suggest that he will not.
The one-and-done theory of party leadership that the Liberals and Conservatives alike have adopted makes little sense to me. It seems to be predicated on the notion that Harper or Trudeau are so beyond the pale that anyone who fails to beat them on a first try deserves banishment. But if any Conservative leader could lose this election to Trudeau and stay on as opposition leader, O’Toole seems very unlikely to be him – not despite he ran a moderate campaign that pleased many progressive conservatives and Liberal swing voters, but precisely because of that. At the end of the day, that’s not the leader party members voted for.”
Renzo to Head KCL's Centre for Politics, Philosophy and Law – Daily Nous
Massimo Renzo has been appointed as the new Yeoh Tiong Lay Chair and Director of the Yeoh Tiong Lay Centre for Politics, Philosophy and Law at King’s College London (KCL).
Professor Renzo, previously a professor of Politics, Law, and Philosophy at KCL and the acting director of the Yeoh Centre, was selected for the endowed chair and directorship following an open search to fill the position. He works in legal, moral and political philosophy, and has written on topics such as political authority, just war, humanitarian intervention, human rights, philosophy of criminal law, consent, and manipulation, among others. You can browse his writings here.
The Yeoh Centre was founded in 2014 with the aim of exploring “major issues in law and politics through the lens of philosophy.” Its previous director was John Tasioulas (Oxford). You can learn more about it here.
Politics Briefing: Quebec introduces legislation to ban pandemic-related protests near hospitals, other facilities – The Globe and Mail
Quebec’s Premier says he is taking a cautious approach to proceeding with legislation to outlaw COVID-19-related protests within 50 metres of hospitals, vaccination sites and testing centres, among other facilities.
“It’s never easy to say you cannot go on the street,” Premier François Legault told a news conference on Thursday, responding to a media question about why he had decided to proceed now with Bill 105.
The legislation, with details on prospective fines, was tabled Thursday by the province’s Public Security Minister Geneviève Guilbault in response to recent anti-vaccine protests outside such facilities.
“It’s not something that you can do every day. You have to be careful. We want to make sure that people will not win, trying to say that the law is unacceptable, and we cannot enforce it,” said Mr. Legault.
“We wanted to do it correctly and I think that also we need to have the support of all the other parties, and I think that it’s the right time.”
Provisions of the bill will cease to have effect when the public health emergency declared in March, 2020, ends.
More details on the legislation here.
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 signup page. Have any feedback? Let us know what you think.
TRUDEAU FACES CABINET CHALLENGES – Justin Trudeau will have to contend with the defeat of three female cabinet ministers as he crafts his senior leadership team in what’s expected to be a quick return to governing. Two senior government officials told The Globe and Mail Mr. Trudeau will outline his government’s next steps once Elections Canada has finalized the seat counts, which could be as early as Thursday. Story here.
QUESTIONS RAISED ABOUT O’TOOLE LEADERSHIP – In the first public challenge to Erin O’Toole from within his own ranks, a member of the Conservative Party’s national council says the Tory Leader should face an accelerated leadership review for “betraying” members during the election campaign.
LIMITED DIVERSITY IN TORY CAUCUS – CBC has crunched the the numbers, and concluded that the vast majority of the MPs making up the new Conservative caucus — nearly 95 per cent — are white, even as the country’s racial makeup is diversifying. Before this election, 9 per cent of Tory MPs were BIPOC. Story here,
LPC CANDIDATE ACCUSED OF TAKING RIVAL PAMPHLET – A Calgary resident says he has doorbell security camera footage showing Liberal candidate George Chahal, the night before the election, approach his house in the Calgary Skyview riding and remove an opponent’s campaign flyer before replacing it with one of his own. He posted the footage to Facebook, which has now received thousands of views. Story here.
FORMER LPC CANDIDATE TO SERVE AS INDEPENDENT – Kevin Vuong, who won the Toronto riding of Spadina-Fort York as a Liberal candidate, said he will serve as an Independent MP, days after his party said he will not sit as a member of the caucus. Story here.
TWITTER BERNIER BAN – Twitter restricted People’s Party of Canada Leader Maxime Bernier’s account, preventing him from posting any new messages for 12 hours after he used the platform to encourage his supporters to “play dirty” with journalists covering his campaign. From CBC. Story here.
KENNEY FENDS OFF LEADERSHIP CHALLENGE – Jason Kenney appears to have quelled another challenge from within his own caucus. A non-confidence vote against the Alberta Premier was withdrawn on Wednesday, but he committed to an earlier-than-planned leadership review, to be held well in advance of Alberta’s 2023 general election. Don Braid of The Calgary Herald writes here on how Mr. Kenney survived this fight against his leadership.
NEW CHARGES AGAINST FORMER SNC-LAVALIN EXECS – SNC-Lavalin Group Inc. and two of its former executives are facing new criminal charges related to a bridge contract in Montreal nearly 20 years ago, plunging the Canadian engineering giant into another legal maelstrom as it tries to rebuild its business after years of crisis. Story here.
FORD LOOKING FOR CHILDCARE DEAL – Ontario Premier Doug Ford says he wants to make a child-care deal with the federal government. The province has acknowledged it was in discussions with Ottawa about a potential agreement into the last hours before the federal election was called in August.
PRIME MINISTER’S DAY
“Private meetings,” according to an advisory from the Prime Minister’s Office.
No schedules released for party leaders.
Andrew Coyne (The Globe and Mail) on whether this is the end of majority governments in Canada: “But in Canada, for one reason or another, the grip of two-party politics has been broken – irrevocably, it seems. As a result, something else that is not supposed to happen under first past the post has been happening, with remarkable frequency: minority governments. This is not just the second straight federal election to produce a Parliament without a majority party: it is the fifth in the past seven, 11th in the past 22.”
Lawrence Martin (The Globe and Mail) on why, if any federal leader should be stepping down, it’s the likeable Jagmeet Singh: ‘Strange business, politics. While a bit short of a majority, Justin Trudeau wins a third successive election by a large margin in the seat count. Yet some critics say he should be put out to pasture. NDP leader Jagmeet Singh suffered a drubbing in the 2019 election, losing almost half his party’s seats. With much higher expectations, he did badly again in Monday’s vote, electing (pending mail-in vote counts) only one more member. Yet hardly anyone says a word.”
Robyn Urback (The Globe and Mail) on why the knives are out for Erin O’Toole, but not Jagmeet Singh: “Theoretically, Mr. O’Toole and NDP Leader Jagmeet Singh should be in the same boat. Both failed to channel national frustration over a pandemic election call and turn it into material support; both delivered underwhelming results. But Mr. Singh, who led a campaign that saw the party claim 25 seats as of this writing – just one more than it held before – doesn’t appear to be in immediate jeopardy of losing his job. The saga of former NDP leader Tom Mulcair, who was turfed by his party when the NDP won 44 seats in 2015 (that is, about 75 per cent better than it did on Monday), offers an explanation for why.”
Jen Gerson (Maclean’s) on why Tories should not “do that stupid thing” they’re thinking of doing: “If you dump your affable, moderate, centrist leader at the first opportunity because he didn’t crack the 905 on his first try, and you replace him with someone who will chase Maxime Bernier’s vanishing social movement like a labradoodle running after the wheels of a mail truck, you will wind up confirming every extant fear and stereotype this crowd already holds about you and your party.”
Steve Paikin (TVO) on advice for Justin Trudeau, inspired by the political experiences of former Ontario premier Bill Davis: “I think if Davis were still alive, he’d tell the current Prime Minister: “A lot of people are underestimating you right now. They think you’re damaged because you called this snap election, and it didn’t work out as you’d hoped. Well, I’ve been there. My advice, Prime Minister, is to reach out. Be more collegial and less ideological and adversarial. Establish a good working relationship with your opponents.”
Send along your political questions and we will look at getting answers to run in this newsletter. It’s not possible to answer each one personally. Questions and answers will be edited for length and clarity.
Japan’s ruling party puts legacy of Abenomics in focus.
Japan’s widening wealth gap has emerged as a key issue in a ruling party leadership contest that will decide who becomes the next prime minister, with candidates forced to reassess the legacy of former premier Shinzo Abe’s “Abenomics” policies.
Under Abenomics, a mix of expansionary fiscal and monetary policies and a growth strategy deployed by Abe in 2013, share prices and corporate profits boomed, but a government survey published earlier this year showed households hardly benefited.
Mindful of the flaws of Abenomics, frontrunners in the Liberal Democratic Party’s leadership race – vaccination minister Taro Kono and former foreign minister Fumio Kishida – have pledged to focus more on boosting household wealth.
“What’s important is to deliver the benefits of economic growth to a wider population,” Kishida said on Thursday. “We must create a virtual cycle of growth and distribution.”
But the candidates are thin on details over how to do this with Japan’s economic policy toolkit depleted by years of massive monetary and fiscal stimulus.
Kono calls for rewarding companies that boost wages with a cut in corporate tax, while Kishida wants to expand Japan’s middle class with targeted payouts to low-income households.
The winner of the LDP leadership vote on Sept. 29 is assured of becoming Japan’s next prime minister because of the party’s parliamentary majority. Two women – Sanae Takaichi, 60, a former internal affairs minister, and Seiko Noda, 61, a former minister for gender equality – are the other candidates in a four-way race.
Parliament is expected to convene on Oct. 4 to vote for a successor to Prime Minister Yoshihide Suga, who announced his decision to quit less than a year after taking over from Abe.
A government survey, conducted once every five years and released in February, has drawn increasing attention to trends in inequality during Abe’s time.
Shigeto Nagai, head of Japan economics at Oxford Economics, said the survey revealed “the stark failure of Abenomics to boost household wealth through asset price growth.”
Average wealth among households fell by 3.5% from 2014 to 2019 with only the top 10% wealthiest enjoying an increase, according to a survey conducted once every five years.
Japanese households’ traditional aversion to risk meant they did not benefit from the stock market rally, with the balance of their financial assets down 8.1% in the five years from 2014, the survey showed.
“We think the new premier will need to consider the failures of Abenomics and recognize the myth that reflation policies relying on aggressive monetary easing will not solve all Japan’s problems without tackling endemic structural issues,” Nagai said.
Bank of Japan Governor Haruhiko Kuroda defended Abenomics and said the pandemic, not slow wage growth, was mainly to blame for sluggish consumption.
“Unlike in the United States and Europe, Japanese firms protected jobs even when the pandemic hit,” Kuroda said when asked why the trickle-down to households has been weak.
“Wage growth has been fairly modest, but that’s not the main reason consumption is weak,” he told a briefing on Wednesday. “As the pandemic subsides, consumption will likely strengthen.”
(Reporting by Leika Kihara; Editing by Simon Cameron-Moore)
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