Tag Archives: Bill Morneau

Roundup: Pearl-clutching about the deficit

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For the first time this week, prime minister Justin Trudeau held a presser, wherein he praised the agreement with the First Nations on moving ahead with transferring control over child welfare, mentioned the virtual Cabinet retreat that was held over the previous two days, and mentioned that new pandemic modelling was on the way, noting that there are still hot-spots around the country. And then it was the takeaway message of the day – a mere couple of hours away from the fiscal “snapshot” being delivered, Trudeau made the case that they chose to support Canadians rather than leaving them to fend for themselves, and that the cost of doing nothing would have been far greater on both healthcare and the economy. He reiterated that this was not the time for austerity, but that they have been building a “bridges” to a stronger, more resilient Canada, and drove home the point that the federal government took on debt so that ordinary Canadians wouldn’t have to. He pointed to the low debt-to-GDP ratio, and that historically low interest rates mean manageable borrowing costs. And with one final word on Bob Rae being appointed to the UN, he took questions, one of the first of which determined that he didn’t recuse himself when the WE Charity sole-source contract came before Cabinet, which is something the Ethics Commissioner is looking at. He spoke about the necessity of childcare, that Bill Blair has been engaged on the subject or the RCMP and police brutality as part of the broader Cabinet workplan on combatting systemic racism, that they were following the recommendations of the Auditor General on CBSA, and then reiterated again that with historically low debt-servicing costs, it was easier for the federal government to take it on in order to prevent Canadian households from having to do so. When asked about the relationship with Donald Trump, Trudeau once again reiterated that they have concerns about the possibility of new tariffs, and that it will only hurt American industry because they need Canadian aluminium as they can’t produce enough of their own.

And then the fiscal “snapshot.” While Bill Morneau’s pabulum-heavy speech was pretty much all self-congratulation and a recap of measures they’ve taken, the accompanying documents did show a $343 billion deficit projected for this year (though it has been speculated that this was an outer bound limit designed for them to come under), and that the total debt by the end of this fiscal year could be $1.2 trillion – numbers everyone clutched their pearls about while ignoring that the debt-servicing costs continue to decrease even though the size of the debt has increased. There was mention that the wage subsidy is going to be extended, but with modifications on the way “sooner than later,” but there wasn’t much indication about the broader recovery plan thus far.

Of course, the obsessions among all of the media coverage was the deficit and debt figures, because our reporting narratives remain firmly affixed in the mid-1990s, and no one can break free of them – not to mention the hyperbolic mentions about how this was the biggest deficit since the Second World War (never mind that this is a virtually unprecedented global pandemic we’re facing with a demand-side shock that people can’t seem to wrap their heads around). And because the framing devices remain in the 1990s, headlines obsessed that there wasn’t a plan to curb spending – because of course we know how the epidemiology of this pandemic is going to play out until we get a vaccine at some point in the future. But perspective? You need to turn to the economists on Twitter for that.

https://twitter.com/kevinmilligan/status/1280933038394875905

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Roundup: Hot and Bothered for Basic Income

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The idea of a Basic Income has been a hobby-horse of parliamentarians for a while, and yesterday the Parliamentary Budget Officer came out with a report that purported to cost one out in a couple of different scenarios. But it’s a bit of a horror show of a report because what it’s actually describing is a cash transfer and not an actual Basic Income scheme, and more than that, some of the things it purports to strip in order to pay for its high price tag are a number of disability supports. Remember that while a Basic Income may sound like a left-wing idea, there is plenty of right-wing support for it if it dismantles the welfare state, where replacing tailored disability programmes with a one-size-fits-all cash transfer is a feature and not a bug. (More from economist Mike Moffatt here).

https://twitter.com/LindsayTedds/status/1280537746881212422

https://twitter.com/MikePMoffatt/status/1280630991661535238

Suffice to say, this report got some senators all hot and bothered, including Senator Yuen Pau Woo, who put out a press release on the topic, calling for a pilot project, so here’s Lindsay Tedds, who worked on BC’s Basic Income project for the last two years, and who knows a thing or two about Basic Income.

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Roundup: Exit WE

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Prime minister Justin Trudeau seems to be making Fridays his campaign stop field trip presser days, and this time it was to a food bank in Gatineau. Trudeau started off by announcing that because of the situation with the new national security law that China had imposed on Hong Kong, they were suspending the extradition treaty to Hong Kong, as well as exports of certain equipment including military equipment. After commenting about how the government was helping food banks during the crisis, he mentioned that they were moving ahead on delayed infrastructure projects, noting that 92 were getting underway in BC. He also said that he would be hosting a two-day virtual Cabinet retreat next week, where discussions would include how to make the country more resilient during future waves of the pandemic. During the Q&A, Trudeau stated that he was disappointed by Air Canada’s service cuts and hoped that they would be restored as the economy recovers. He also made the point that childcare was an important consideration and why it was one of the conditions for the provinces as part of the $14 billion that is still on the table, and that hasn’t been agreed to. Asked about the intruder on the grounds of Rideau Hall, he simply stuck with thanking the RCMP for their response. And with regards to China, Trudeau said that they were taking action regarding the Hong Kong situation, and looking at steps that Canada can take while we are in discussions with our allies.

Of course, Trudeau also addressed the news that shortly preceded his presser that WE Charity had voluntarily pulled out of the Canada Student Grant programme, for which he said that he was disappointed in how it unfolded, but that he would continue to look for ways to give young people opportunities to serve. He stated that he thought WE had more capacity for training and protectively identifying volunteers, and insisted again that it was the public service that reached out to WE and not his office. And a few hours later, the Ethics Commissioner said he would look into this contract on the grounds of whether or not it furthered the private interests of someone (meaning Trudeau’s family), though I’m not sure how exactly volunteering their time and profile is a material benefit when they get no money from it. Then again, this particular Ethics Commissioner has gone out of his way to invent new interpretations of offences to make it look like he’s being tough, so who knows where this will go.

On the subject of WE, new revelations came out in advance of their pulling out, including criminal activity and fraud in their Kenyan operations in 2017, and the fact that they were offering summer camps $25,000 if they brought in over 75 volunteers over a few months. To add to that, others in the charitable sector are raising questions about the assertion that WE was the only group capable of administering the programme given that they lack links with local groups across the country ­– and the government’s own Canada Service Corps could have been used instead. So it’s no wonder that WE looked at what was before them and decided to pull the plug before even more organizations started digging into their activities, and this government didn’t fight them on it, because maybe they’ve learned a lesson or two on issues management. Maybe.

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Roundup: Manufacturing an “attendance” record

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The big headline that everyone was talking about yesterday was a load of manufactured bullshit, which shouldn’t really surprise anyone, but it was what everyone was throwing around nevertheless. The Globe and Mail crunched the numbers from the Zoom log-ins from the special COVID-19 committee that has been sitting in lieu of regular House of Commons sittings, and found that lo, the Conservatives had the worst “attendance record.” Which is kind of hilarious because it completely misunderstands how this whole farcical process works. Oh, but the Conservatives must be hypocrites, because they’re demanding full sittings! Well, no – you’ve just found some numbers that you’re applying disingenuously in order to make them look like hypocrites. It’s exactly the kind of stunt that causes people – and small-conservatives especially – to distrust the mainstream media, because it looks an awful lot like they’re not being given a fair shake. Of course, Andrew Scheer didn’t do himself any favours when he called it “Liberal spin” rather than pointing out that this was a false construction, but his inability to do anything other than meathead partisan talking points was and still is his downfall.

Why this is such bad-faith “reporting” is because it ignores the fact that there is a set speaking list every day. If you’re an MP – particularly a Conservative MP in a rural riding where you have spotty Internet to begin with – what incentive is there for you to log into Zoom and watch it that way when you have no chance to participate when you can simply follow the proceedings on CPAC and get a better experience because the translation tends to work better? It also operates on the assumption that all 338 MPs are in the House of Commons at all times when Parliament is sitting regularly, which isn’t the case – the only time all MPs are in the Chamber are during Question Period and for votes, and no, despite the sales job that the government has been trying to foist onto the public, this committee is not Question Period. Trying to hand out attendance awards for participating in a Zoom call on steroids is a waste of everyone’s time and resources, and is a distraction from the actual issues related to the calls to have proper in-person sittings – or it would be if the majority of media outlets could actually report critically on it rather than swallowing the government’s lines.

Speaking of outrage clicks, the CBC has again been misrepresenting some Senate matters, like how the Selection Committee works, as part of their story wherein Senator Dalphond is calling for committee chairs and deputy chairs to rescind their “bonuses” in the current session because of many haven’t sat because of the pandemic. But it occurs to me that it’s unlikely that chairs have even been getting their stipends because most committees haven’t even been constituted yet, which makes this look even more like this is part of Dalphond’s particular vendetta against Senator Yuen Pau Woo, and Woo’s insistence on chairing the Selection Committee, and he’s trying to use a larger point about chairs’ salaries (using false comparisons with the House of Lords as ammunition) in order to provide cover from making this look personal. I am becoming extremely concerned about Dalphond’s behaviour here – though my disappointment with how the CBC covers the Senate is pretty much standard. Cheap outrage clicks on the backs of misrepresenting the Senate is par for the course for how journalism runs in this town. (I wrote more on the backstory here).

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Roundup: Data-sharing and demanding models

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For his morning presser, prime minister Justin Trudeau noted that he was planning a teleconference with the premiers that evening to talk about coordinating their efforts, and better data sharing. He also stated that they had received 1 million new N95 masks the night before, and that they were working to validate the 10 million other masts they got over the past several days and were distributing those to the provinces as well. He got more questions on modelling the pandemic, saying that it was still coming because the data wasn’t there yet, and said that those returning to Canada from abroad posted a “real risk” to the entire country if they didn’t follow the rules and immediately self-isolate.

During the ministerial briefing that followed, Patty Hajdu wouldn’t entertain questions on whether or not she trusted the data coming out of China, saying that they relied on WHO data, and dismissing some of those concerns as conspiracy theories, which had the pundit sphere in a tizzy the rest of the day. Mark Miller also said that they were considering requests from a couple of different First Nations about military field hospitals being set up in their regions, while more money for pandemic preparedness was flowing. Bill Morneau had a separate appearance before a teleconference of the Commons finance committee (which was a bit of a gong show), where he stated that they went with hard-and-fast rules for compensation that could mean that there are gaps in coverage because that was the fastest way to get compensation out the door. (Of course, he didn’t spell out the capacity challenges, which just leaves him vulnerable to more baseless criticism).

[Maclean’s has updated their Q&A on symptoms and where to get testing]

As for the debate over producing the modelling, we’re seeing some provinces promising to roll theirs out – Doug Ford promising it’ll be today – but I’m having a hard time trying to see what it’s going to do at this point that will be of any real help. I am very convinced that we don’t have enough good and consistent data right now (and there are several experts who say we don’t have enough to do proper modelling just yet), and if people want to see how bad it can get, just look at Italy or Spain. I also don’t trust in the capacity of the majority of my fellow journalists to interpret any of this modelling data anywhere near correctly, given that they have proven to be proudly innumerate already during this pandemic (and a good many of them can’t handle basic civic literacy when they cover politics), so I am largely convinced that they are demanding the models for the sake of easy narratives, such as a screaming headline about worst-case scenario death counts. (Seriously – I have been in this industry long enough to know that’s exactly what’s coming). And I also fail to see how it would offer any kind of reassurance to the public, especially as they can see the death counts in other countries as well as they could a headline about worst-case scenario modelling in Canada – add to that the additional confusion of the disputes over methodology that would follow. Models aren’t data, and according to one data analyst I know, no one will read the technical quotes associated with any released modelling, and it will serve as disaster porn – and she’s right. I mean, certain outlets who shall not be named relied on dial-a-quote outrage from certain familiar sources to bolster their case for demanding the numbers be released, in the face other outlets getting opinions from specialists who are saying it’s too soon to have good data on this. But maybe I’m just pessimistic.

https://twitter.com/moebius_strip/status/1245825513072951297

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Roundup: A big wage subsidy

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For his Friday presser, prime minister Justin Trudeau had big headlines but few details – that the government was going to boost the wage subsidy for small and medium-sized businesses to 75 percent from the originally announced ten, along with a few other tax deferral measures to help businesses retain their liquidity. The details, however, aren’t going to be released until around Monday, but Trudeau stated that it was more important to get the message out that this help was on the way so that they would ensure that these businesses retained their employees (or even re-hire them) rather than lay them off so that they can collect EI or the new emergency benefit for the duration. Speed over perfection is the new motto of the times. (On a side note, Andrew Scheer was going around taking credit for this subsidy, when I know for a fact it was other people working behind the scenes, but Scheer needs to try and justify his existence).

This announcement came in the wake of a new PBO report that estimated the size of the deficit based on the measures that had been announced to that point, but what was particularly significant was that his modelling was that physical distancing would be in effect until August, which sent the various reporters into apoplexy, as they started demanding to know how long that Trudeau thought that current conditions were going to last – as though that was a question he could reasonably answer at a time where the Quarantine Act has only just been enforced, and we have returning snowbirds who think that these rules don’t apply to them, and where it’s still too soon to see how much of an effect the current measures have had. Quebec is seeing a spike in cases because their spring break was two weeks ahead of everyone else’s in the country, and it’s showing up in the data now.

It was also worthwhile noting that Bill Morneau and Stephen Poloz had another joint press conference today – Morneau to reiterate some of the messaging around the new wage subsidy, and Poloz to take questions about the emergency rate cut that the Bank of Canada announced shortly beforehand, where they cut rates to 0.25 percent, which is as low as they’re going to go, but to also engage in quantitative easing (which is not actually printing money as he spelled out). Their joint appearance seems to be remain under the aegis of trying to reassure the public and the markets that our fiscal heavyweights are on the case, but when this is all over, we will need to see our parliamentarians examining the relationship to ensure that monetary policy truly remained independent and not coordinated with fiscal policy, no matter how dire the economic situation.

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Roundup: A negotiated solution

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In the end, a compromise was reached – MPs shuffled back into the House of Commons by 3 AM, and had passed the bill by six, after grilling the ministers who were present. Parliament did its job, democracy was saved, and the Conservatives spent the day patting themselves on the back to let you know just how brave they were in saving it. As the bill was over in the Senate on schedule – and it had always been scheduled to reach there yesterday for debate and passage and not on Tuesday, as many hysterical media outlets failed to mention – Trudeau held his daily presser, outlining the measures that were passed within it, which included a streamlining of several of the earlier-announced benefits into a more catch-all $2000/month benefit over the course of four months for anyone who wasn’t working, whether they had been laid off or not. Trudeau also announced new support for journalism (mostly ad revenues) and an acceleration of their tax measures. During the ministerial briefing, more details on supports for Indigenous communities was outlined, and shortly thereafter, Patty Hajdu also announced that the Quarantine Act was being invoked to ensure travellers returning to Canada actually self-isolated, even if it meant the government putting them in a hotel room for two weeks and providing them food.

[Maclean’s has updated their information on symptoms and where to get tested].

The tales of the negotiations are fairly interesting to me, in part because there seem to be breakdowns across the board. The Conservatives went into this saying “no surprises” and were surprised by the outsized spending powers, which they say broke their trust. The Liberals were on the one hand apparently surprised to see them in there (and it’s a question of whether it was the drafters in the Department of Justice who are to blame, or perhaps some of the people in Bill Morneau’s office who seem to operate pretty independently of the minister, if testimony from the Double-Hyphen Affair is to be believed), while also justifying that they needed enhanced powers because of the shifting nature of the pandemic emergency, and how fast everything has been changing. Which mostly just reinforces my own previously published points that if we kept the Skeleton Parliament in place, the government could more easily pass new fiscal measures in short order rather than do the song and dance of recalling MPs while providing more constant oversight while still respecting physical distancing and other protective measures. But who listens to me?

Paul Wells gives his take on the whole affair here, which is well worth your time reading. (My own take on what brought us to this point, in the event that you missed it, is here).

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Roundup: Officially on the way to Canada

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It’s official – Prince Harry and Meghan, Duchess of Sussex, will be splitting their time between Canada and the UK as they “transition” to private lives, according to a statement from the Queen – and that has a bunch of coverage already in a bit of flurry. Despite a UK outlet erroneously reporting that Prime Minister Justin Trudeau has already agreed to pick up security costs for the couple in Canada, Bill Morneau stated that the matter hasn’t been discussed yet (which didn’t stop certain media outlets in this country from trying to make it sound like it was a fait accompli, because there’s nothing they love more than cheap outrage stories – never mind that if they’re no longer senior royals, they may not be entitled to the same protection that they currently have). Even if we were to cover it, at $1.7 million per year, that’s still a fraction of what we paid for when Barack Obama visited Ottawa for an afternoon, so let’s keep that cheap outrage in check.

BC premier John Horgan said he was very excited about the possibility of the couple moving to BC, and suggested some potential jobs for them in the area. (I have some suggestions of my own, which should be on macleans.ca later today). Here is some analysis of the results of the meeting with the Royal Family as to the next steps for the couple in the wake of the announcement. As well, here is some media analysis to show how Kate, Duchess of Cambridge, has been treated differently from Meghan, and it’s proof of how framing devices absolutely matter in media in how stories are presented.

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Roundup: Fiscal update and actuarial context

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Finance minister Bill Morneau released his fall economic update yesterday, and it showed that while the economy was doing well – fairly strong growth, very strong job creation (November’s numbers notwithstanding) and wage growth – the deficit was going to get a lot bigger unexpectedly. The reason for it, however, was largely ignored by all of the commentariat, both media and partisan, because the kneejerk response in Canada about any finance story is about the size of the deficit, end of story. The real reason – that low interest rates had forced a hefty actuarial adjustment for government pension plans – was inconvenient for them to force a narrative onto, so they just ignored it and clutched their pearls some more, crying “The deficit! The deficit!” and the Conservatives continued to cheerlead a “made-in-Canada” recession by cherry-picking some very selective economic data that was to the exclusion of the broader trends, because narrative. Here’s economist Kevin Milligan to explain some more.

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I would add that while the Conservatives like to rail about how our unemployment figures compare poorly to other countries, it’s a bit of a fool’s errand because we don’t all measure unemployment the same way, and not all of our economies work the same way. Canada has had record low unemployment in recent months, to the point where economists say we are have been at what is essentially “full employment” – in a statistical sense, not to dismiss that there are regions where it’s still a problem, but essentially there’s not a lot of room for more job growth in the economy. But hey, why let reality get in the way of the narrative, right?

In terms of analysis, John Geddes delves into the notion of “endless deficits” and finds that, shockingly, it’s not a cut-and-tried issue, but the real issue is complacency. Certain bank economists think that because the shift in the deficit is on pension obligations, it could force the Bank of Canada to act sooner if there were an economic downturn. Heather Scoffield wonders what kinds of budget promises that Morneau will have to abandon given the bigger deficit figures if they don’t want to lose their debt-to-GDP anchor.

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Roundup: Kenney’s shock-and-awe tour

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Jason Kenney is in town on his shock-and-awe tour, with eight ministers and countless staff in tow, intent on making the province’s “Fair Deal” case to their federal counterparts – while those federal ministers smile and nod and say “yes, dear.” Meanwhile, certain credulous journalists and columnists are swallowing Kenney’s presentation whole, as he brings charts and graphs and rattles off figures that they don’t bother to question, never mind that he has a well-known and well documented propensity for lying with these very same facts and figures – and then gets terribly indignant if you call him on it, and will keep reiterating them, bulldozing over his doubters. And we’re going to get even more of that during the media rounds later today – mark my words.

To that end, Kenney’s ever-evolving list of demands continue to be largely unreasonable (as said credulous journalists and pundits nod and say “They’re perfectly reasonable” when they’re not) – things like demanding a solid timeline for the completion of the Trans Mountain pipeline (impossible if there are further court challenges, and Kenney is lying when he says there are mechanisms), along with bringing in First Nations as equity partners (there is little point until the project is completed, which was the whole point of buying the pipeline in the first place – to adequately de-risk it); his $2.4 billion demand for “fiscal stabilization,” some of which he plans to put into remediating orphan wells (never mind the Supreme Court has ruled that these are the responsibility of the companies who owned them); substantial repeals of environmental legislation (because the failed system under Harper that only resulted in litigation worked so well); changing rules so that oil and gas companies can raise revenues (reminder: flow-through shares are de facto federal subsidies); and recognising Alberta’s efforts at methane reduction (I’m going with “trust, but verify” on this one, because Kenney likes to lie about the province’s other carbon reduction efforts). So yeah – “perfectly reasonable.” Sure, Jan.

Bill Morneau, for his part, says he’s willing to talk to his provincial counterparts at their upcoming meeting about fiscal stabilization, but isn’t making promises. While the premiers all signed onto this notion at the Council of the Federation meeting last week, it was because it’s federal dollars and not dealing with equalization which could affect their bottom lines – and Kenney’s supposedly “conciliatory” tone in which he says he’s willing to accept fiscal stabilization changes over equalization is likely a combination of the realization that he’s getting to traction from the other premiers, whose support he would need to make any changes, and the fact that Trudeau publicly called Scott Moe’s bluff on equalization reform when he said that if Moe can bring a proposal forward signed off on by all of the premiers then they would discuss it – something that isn’t going to happen. This all having been said, it also sounds a lot like Kenney wants the rest of Canada to bankroll the province for their decision not to implement a modest sales tax which would not only have solved their deficit but would have provided them with the fiscal stability to help weather the current economic hard times – but that’s an inconvenient narrative. Better to drum up a fake separatist threat and try to play the hero instead.

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