Tag Archives: Budget 2018

Roundup: Changing the accounting rules

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There were some fairly big changes announced yesterday, but the way in which it was reported was interesting if you compared coverage. For example, The Canadian Press led with the headline of a $19-billion federal deficit last year, but didn’t explain until the fifth paragraph that the accounting rules had changed, and described it as “confusing matters,” and then engaged in both-sidesism to have the Conservatives rail about the size of the deficit rather than really explain what the changes meant. The Financial Post mentioned the changes in the second paragraph, but focused on the size of the deficit. It was the CBC’s coverage that spent the full story focused on the accounting rules changes and what they mean, and how that affects the reporting of the figures, which has a lot to do with unfunded pension liabilities that are now being put on the books in a transparent manner that the Auditor General has been calling for, for years now. Context like this is important, and it’s disappointing to see it obscured because writing about the deficit figures is sexier without explaining what they mean, so well done there. You’re really serving your readers.

As with any of these stories, however, the best commentary came from some of the best economists on Twitter, who put it all into context. The full Kevin Milligan thread explaining it all is here, but I’ll post some select highlights.

https://twitter.com/kevinmilligan/status/1053342629574828032

https://twitter.com/kevinmilligan/status/1053346059693346816

He also busted the myths about the deficit spending by pointing to the $70 billion hole in GDP that the Liberals were left with when they took office, in part because of the oil downturn and technical recession that the Conservative narrative keeps ignoring.

https://twitter.com/kevinmilligan/status/1053393949417586688

https://twitter.com/kevinmilligan/status/1053395164318752768

https://twitter.com/kevinmilligan/status/1053403984411582464

Also, Mike Moffatt points out the significance of those accounting rules around pension liabilities on the reporting of the books.

https://twitter.com/MikePMoffatt/status/1053342822017982465

https://twitter.com/kevinmilligan/status/1053354656384962560

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QP: Sunset clause off the table?

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Although Justin Trudeau was present for QP today, Andrew Scheer was not, once again. Lisa Raitt led off, asking succinctly if it was true that Trump took the five-year sunset clause off of the negotiating table. Trudeau got up to first thank the opposition and all Canadian for standing together, and after some applause, noted that they are still negotiating but they would not accept a sunset clause. Raitt wanted a clear yes or no if it was taken off the table, and Trudeau spoke around the question, talking about his meeting on Friday, but would not say if it was taken off that table. Raitt said that she would have to take it as a yes, and worried about the trade war on families in her riding, before demanding that carbon taxes and payroll taxes be scrapped. Trudeau said that no, the sunset clause was not taken off the table, before talking about how tariffs would hurt American workers as well as Canadian ones. Alain Rayes took over in French, and concern trolled about the deficit and the drop in foreign investment, and worried how the prime minister could say he was good for the economy. Trudeau deployed his well-worn talking point about Canadians choosing investment instead of austerity. Rayes listed areas where the Fraser Institute says that taxes went up, to which Trudeau reminded him that the Fraser report didn’t take the Canada Child Benefit into account. Guy Caron led off for the NDP, asking about a First Nation band building a solar farm on their land while a pipeline crosses it, framing it as competing visions, to which Trudeau took up a script to rad that the Federal Court of Appeal started that the previous government didn’t adequately consult First Nations and his government did. Caron reiterated in French, and this time Trudeau read that they used to support Rachel Notley’s plan, before listing similar measures his government is taking. Alexandre Boulerice railed that they were not investing in a fair energy transition, and Trudeau reiterated his Notley’s-filled script. Jenny Kwan railed that CPP may invest in the pipeline, to which Trudeau repeated Notley’s plan, yet again.

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QP: Solidarity in the face of Trump – more or less

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Following the melodrama of the G7 summit over the weekend, the PM decided to take the day off from QP, but so did all of the other leaders, so make of that what you will. Candice Bergen led off, saying that they stood together with workers, and wanted to know what the PM’s plan was to resolve this impasse with the Americans. Dominic LeBlanc got up to respond, thanking Canadians for standing together to protect workers, and that there was no national security threat, and everyone gave hearty applause. Bergen then worried about whether the deficit took into account a potential aid package for these affected workers, and LeBlanc noted that any tariffs would also hurt American workers, and they were consulting on the sectors to see how they could help. Bergen said that they could immediately ratify the TPP, scrap the carbon tax, and eliminate trade barriers between provinces, and to invited them to work with Conservatives. François-Philippe Champagne said that they would have a TPP ratification bill tabled before the summer. Alain Rayes got up to repeat the deficit question in French, got the same response from LeBlanc in French, and then they went another round of the same. Ruth Ellen Brosseau led off for the NDP, asking the government to provide a unified response with all parties against Trump. LeBlanc said that obviously yes, they would work with all members to protect workers and ensure that retaliatory measures are proportionate. Brosseau then raise the leak from the existing Trans Mountain pipeline and that the government failed in its consultation of First Nations. Marc Garneau responded by reading that there were strong laws on pipelines on polluters paying for problems. Nathan Cullen repeated the question in English, with added sanctimony, to which Jim Carr noted that by repeating the polluter-pay principle in the Pipeline Safety Act. Cullen read a statement from a First Nations chief about the quality of the consultations, and Carr fumbled in his response about the NDP trying to speak on behalf of First Nations.

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Roundup: Undead electoral reform concerns

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With BC’s electoral reform referendum on the horizon, and vague promises around it from the Ontario NDP as the election draws to a close, we’re apparently talking proportional representation again. Sigh. Over the weekend, Jean Chrétien made the particular case in his idiosyncratic way that the reason why it’s a bad system, and the core of his argument is that it doesn’t force people to engage with voters. Door knocking to win a riding? Democratic. Being a party wonk who gets in because they’re on a list? Not very democratic. It’s a way of looking at the practical inputs and outputs of the system that most people gloss over when they whinge about the popular vote (which, I will remind you, is a logical fallacy because general elections are not one single event, but 338 separate but simultaneous events) and how “unfair” it seems when viewed through this skewed lens.

As for this referendum in BC, it’s a bit of a dog’s breakfast with its two-stage vote – the first vote as to whether to keep First-Past-the-Post or to adopt a system of proportional representation; the second stage being to choose between three systems – mixed-member proportional with some regional weighting, dual-member proportional, and a hybridized system where urban ridings would have single-transferable-votes, and rural ones would have some kind of proportional system akin to MMP. But there are problems with all three choices – the regional weighting associated with their version of MMP exists nowhere in the world so we don’t know the outcomes; the dual-member proportional is a theoretical system dreamed up by some University of Alberta system that exists nowhere in the world and we really have no idea if or how it would actually work; and the split urban-rural system would never pass constitutional muster. If BC’s attorney general thinks that the Supreme Court would allow different voting systems based on where you lived, I suspect that he’s dreaming, and it would have to be one hell of an excuse to try and save this with Section 1 of the Charter (being that it’s a reasonable curtailing of your rights and freedoms in a free and democratic society). So, good luck with that.

Meanwhile, Andrew Coyne is no fan of the two-stage referendum and would rather simply prefer a single ballot where status-quo was an option like they did in PEI. Where Coyne goes wrong is when he said this as successful in PEI – it really wasn’t. They had to go some five ballots before a PR system squeaked through by the narrowest of margins with unusually low voter turnout for a province that typically takes voting very seriously. Colby Cosh, meanwhile, quite properly lambastes the whole affair as being completely gamed, because aside from the way in which they’re dubiously counting the second ballot if one system doesn’t get a majority from the start, there are still too many unknowns in the three proposals, including whether the proportional lists would be open or closed – a very huge consideration in how PR systems work, and which goes to the heart of holding governments to account in these systems. In other words, this BC referendum is shaping up to be a boondoggle from the start, which is not good for our democracy in the slightest.

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Senate QP: MacAulay reminds us he’s a farmer

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After a raucous Question Period in the Other Place, has it was a much more sedate affair in the Red Chamber as agriculture minister Lawrence MacAulay arrived to answer questions. Senator Larry Smith started off in French, asking about the cultivation of marijuana and land use, and what steps would be taken to avoid the diversion food land for large-scale outdoor grow ops. MacAulay first regaled us with tales about prohibition, and then noted that the bill was under the jurisdiction of the ministers of justice and health, but he was also concerned about the use of land, and eventually said he would assure senators that he would do anything he could to ensure that land would remain for farm use. Smith asked if he offered any advice to Health Canada officials on the use of outdoor growth, but MacAulay didn’t really offer any kind of assurance.

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Roundup: Don’t be fooled by Friday’s childish meltdown

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You may have heard that there was a bit of a meltdown in the House of Commons yesterday. You may also have heard a bunch of suspect commentary about what it was about, and some particularly dubious ruminations about how noble it was that these opposition MPs were standing up for their rights to examine the Estimates and to ensure that all government spending was properly voted for, and so on. The problem is, is that those sentiments demonstrate that they’ve been taken in by the ruse that this is all related to.

So, to recap: Yesterday the parties were on notice that Government House Leader Bardish Chagger was going to move the motion to start late-night sittings in the House of Commons for the last four scheduled sitting weeks, in order to get bills through and off to the Senate. After all, it’s likely that the government wants to prorogue and have a new Throne Speech in the fall, and it’s better to get as many bills off the Order Paper before that happens. But just before Chagger is going to move that motion during Routine Proceedings yesterday, the NDP’s Daniel Blaikie conveniently stands up to raise a point of order and starts to demand that the Speaker allow them to delete Vote 40 from the Estimates. Vote 40 is related to the $7 billion fund that the government wants to use to get a move on budgetary matters that haven’t made it through proper Treasury Board review yet. The figures are all in the budget, laid out in a table, on how it will be spent. The opposition has decided that this is really a “slush fund” that can be spent on anything (the government is quite insistent that if they spent it on anything other than what’s in the table in the budget that it would constitute unauthorised spending, which is a significant thing). After Blaikie started a lengthy speech about it, the Speaker said he’s heard enough, that the matter is before committee and not the Commons, so it’s not in order. When he tried to move onto other business, Blaikie kept demanding he be heard. The Conservatives joined in. And thus began an eight-minute childish tantrum of shouting and desk banging that drowned out other business, and once that calmed down, endless cycles of points of order regarding whether or not they could hear the motion or the interpretation, and so on. There was no greater principle being expressed or upheld – it was a procedural filibuster. And we know this because they tried other tactics after that one failed, including points of personal privilege over the earlier meltdown, and a concurrence debate on a committee report (which, as Kady points out, is kind of fun to watch because almost no one has prepared speeches for them, so they’re forced to think on their feet, which they should be doing anyway, but whatever).

Procedural shenanigans I’m fine with. It’s a necessary part of Parliamentary democracy. I’m less fine with the infantile tantrum that they threw when they didn’t get their way. That’s the part that needs to be called out for what it was. And I especially resent the fact that you have a bunch of pundit who should know what a filibuster looks like after being on the Hill for so many yearswho were all “They have a legitimate point!” That legitimate point, as meritorious as it may be in a more existential conversation about reform of the Estimates process, was not what this was about, and to treat it as though it was is to fall for the game. I will additionally add that I am especially displeased with the commentary on the Power & Politicspower panel, where pundits who are not in Ottawa and who don’t cover this place got space to ruminate about how the Speaker was acting partisan because the government is on its heels a bit, of that this $7 fund was just like an omnibus bill that they swore they would never use, and nobody pushed back about how bogus this commentary was. (Paul Wells offered the actual take, bolstered by Aaron Wherry, for the record, but regardless). I will reiterate that procedure matters, and it would really help if people covering and commenting on this place understood that.

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Senate QP: Hajdu ducks a request

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Following weeks of condemnation around the government’s insistence on the “Charter rights” attestation for Canada Summer Jobs Grant applications, it was time for the minister of labour, Patty Hajdu, to appear before the Senate to answer questions. Senator Larry Smith led off, as is customary, and he asked about the fact that no new federal drug testing regulations would be in place before marijuana was legalised. Hajdu noted that in her previous job, she dealt a lot with substance use issues with clients adn employees, and she was passionate about the topic. She noted that they are working with federally-regulated employers and labour groups, but also called out that this debate was a red herring because cannabis is not new, nor is use at work. Smith wanted some degree of certainty for employers, and Hajdu said they are already having those conversations, and most workplaces already have robust policies.

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Roundup: Decrying unfairness while ignoring logic

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As the countdown to Kinder Morgan’s deadline for some kind of reassurance around the Trans Mountain pipeline expansion draws near, we’re starting to see a lot of angry commentary from Western conservatives, and not all of it is very well thought out. Yesterday, former Wildrose leader Brian Jean took to the Financial Postto say that Alberta needs to demand a “fairer deal” from Canada…but made a litany of errors and misrepresentations, and gaps in the logic of his own conclusions. Andrew Leach laid out many of them here:

I would add that Jean also disingenuously ignored the fact that the Federal Court of Appeal ruled that the Northern Gateway process didn’t adequately consult the First Nations to a constitutional standard, which was entirely the fault of the Harper government and not Trudeau. And for his complaints around Energy East, he also ignored the fact that while the NEB said that they would look at downstream emissions as part of their analysis, Cabinet broadcast that their criteria for approval had not changed, and it did not include those emissions profiles. It also ignores the economics of the situation, that Energy East was the most expensive option now that Trans Mountain and Keystone XL had been approved. It also gives the false notion that it would allow Alberta oil to flow to Eastern refineries for the sake of “energy security” when those refineries are not built to handle the kind of heavy crude that Alberta exports, and thus the majority of it would not wind up in Canadian gas tanks. But hey, why do facts matter when you’re trying to stir up anger?

And anger over equalization is so easy to stir up when you constantly misrepresent the issue. It’s not a cheque that the province hands over – it comes mostly out of personal income taxes. It’s a federal programme, and the reason Alberta pays more into it and doesn’t get it is because Albertans have the highest incomes in the country, and the fiscal capacity that their government can offer the same level of services as other provinces without crippling taxes. And when Premier Moe starts tweeting about “shipping out” equalization dollars, I think it’s fair to ask if he thinks that his province wants either the lower incomes or the reduced fiscal capacity that it would take for them to be a net receiver of equalization. (Note: He does have a point about the rail backlogs, and the federal government could have taken measures to deal with that months ago if they so chose). But seriously – these equalization/fair deal gripes are not grounded in fact or logic, and we need to remind people of that.

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Roundup: Sending amendments back a second time

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There’s drama with the Senate, after they sent back the omnibus transport bill back to the Commons a second time, after the government rejected several of the nineteen amendments proposed. We haven’t seen this happen in twelve years, that last time being in 2006 when there was back-and-forth on Harper’s Accountability Act, when he had a minority in the Commons, and the Liberals had a majority in the Senate, giving them the necessary leverage. But while much of the focus is on whether or not there’s going to be a constitutional crisis over this (there’s not, and quit being such drama queens about it), there is actually some nuance here that should be explored a bit more.

There are a couple of reasons why the Senate eventually voted to insist on some of the amendments, and one of those had to do with the way it creates unfairness for the Maritimes when it comes to rail transportation rates, as there is a monopoly in the region. What’s very interesting about this is the fact that after PEI Senator Diane Griffin made her speech about the regional unfairness, all subsequent debate became spontaneous and unscripted – something we almost never see in either chamber. This is how Parliament should work, and based on that speech, some senators changed their votes, which shows that the process does work as it’s supposed to, from time to time. It also shows that the Senate is fulfilling its role when it comes to standing up for regions, as they are doing for the Maritimes in this case. (Griffin, incidentally, says she’ll likely back down if the Commons rejects the amendments a second time).

The other reason the Senate is sending these amendments back, however, is the fact that when the government rejected them, they didn’t offer an explanation as to why, and this is important (and I haven’t seen anyone reporting this fact). And this puts the onus on the government, because they owe senators that explanation as to why their sober second thought is being rejected. Just about a year ago, when the Senate sent back amendments to the budget implementation bill, the House rather snippily stated that such amendments would impede the privileges of the Commons – but never stated how they would do so. While the Senate passed the bill, they did send a message back to the Commons that yes, they do have the ability to amend budget bills thank you very much, but they did make sure to let Bardish Chagger know their displeasure the next time she appeared at Senate QP, where they wanted the explanation as to how the amendments would impact the Commons’ privileges (and she never did give them an answer). Trudeau keeps saying he respects the independence of the Senate, but he should demonstrate that respect by offering explanations and not treating the work of the Senate in such a dismissive manner.

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Roundup: An “uncontroversial” bill delayed

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It’s starting to become something of a rote exercise – that whenever the Senate does its job and considers large and contentious legislation, it’s accused of moving slowly. Most of the time, they’re actually moving fairly swiftly in the context of how bills get passed, but that’s not the narrative. And every single time, the pundit class will moan about how they’re frustrating the “will of Parliament” (because that’s how they refer to the House of Commons, when it is in fact but a third of what constitutes Parliament – the Senate and the Crown being the other two aspects), and on and on we go. This week’s performative disbelief that the Senate is daring to do the job required of it is around the marijuana bill – but not just that, but the accompanying bill regarding mandatory roadside testing. While the marijuana bill is actually proceeding fairly quickly given the agreed-upon timelines that Senators set for themselves on the bill (though they were slow off the mark because Senator Harder thought it wise to have the Senate rise essentially a week early at Christmas and then not consider the bill again until well after they’d returned so that he could put on the dog and pony show of having three ministers appear in Committee of the Whole before second reading debate even began), the mandatory testing  bill is languishing at committee. Why? While John Ivison may consider the bill “relatively uncontroversial,” it is actually the opposite, and there is a debate raging about the bill’s constitutionality, and many senators – including one who helped to author the Charter of Rights and Freedoms back in 1982 – are unimpressed with the government’s assurances. After all, they went through a decade of the Harper government insisting that their justice bills were Charter-compliant, only for them to be struck down by the courts, one after another.

Of course, this too has led to debates in the Senate about their role and whether they should be challenging the constitutionality of bills. Some of the Independent senators, which Leader of the Government in the Senate – err, “government representative,” Senator Peter Harder has added his voice to, believing that Senators shouldn’t substitute their judgment for that of the courts, citing that because these issues aren’t black and white that the courts should handle them. (In the same breath as Harder says this, he also says that they shouldn’t be rubber stamps, apparently unable to pick a lane). So to say that this is “uncontroversial” means that someone isn’t paying attention to the debate – only what’s being told to him by the government’s mouthpiece (in this case, Bill Blair).

If the Senate passes C-45 before C-46, the sky won’t fall. They can apply existing impaired driving laws, because, newsflash, people already drive high while pot is illegal. Once again, the government isn’t inventing cannabis – they’re legalizing and regulating it. Will it be more difficult without detection devices? Maybe. But it’s not like there’s a legal vacuum. Let’s calm down a little.

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