Roundup: The crash and the cries for stimulus

It was a tough day on the markets yesterday as stock markets plunged at record levels over panic-selling because of COVID-19, and oil prices cratered while Saudi Arabia and Russia got into a pissing contest. Bill Morneau held a post-market-closing press conference to assure Canadians that there was fiscal room to deal with the situation, but he spoke in frustrating platitudes and generalities as he so often does (because this government is largely incapable of communicating their way out of a wet paper bag), but it needs to be acknowledged that his budget challenge has become a lot more complicated, particularly as the oil shock is going to impact federal revenues as well as Alberta’s. But seriously, the whole Conservative “spent the cupboard bare” narrative is bogus and economically illiterate, and they are actively spreading misinformation about it.

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Around the same time, Jason Kenney held his own press conference, saying that all options were on the table for dealing with the downturn on the province’s economy – and then immediately ruled out a sales tax, which would stabilize the province’s revenues. Because that might make sense. Rachel Notley says that he should scrap the budget and re-do it, given that its assumptions are now proved to be useless, but other economists say it’s likely not worth it at this point, and it would be better to have a fiscal update in the near future.

And then come the demands for some kind of fiscal stimulus plan, but one of the things they’re pressing is that measures need to be timely. Maclean’s talks to four economists about what they think such a plan could look like for the best impact.

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Roundup: Caution – plummeting oil prices

Oil prices started plummeting Sunday night as a price war opened up in the midst of declining demand due to the COVID-19 outbreak, and this is going to have a huge impact in Canada, not only with Alberta and Saskatchewan, but most especially with Newfoundland and Labrador, whose government relies very heavily on resource revenues. Add to that, this is going to put even more pressure on Bill Morneau and the federal government when it comes to how to deal with reforming fiscal stabilization in the upcoming budget, particularly if it’s also going to mean any kind of rebate for previous years’ stabilization (as Jason Kenney in particular has been demanding, under the misleading term of “equalization rebate,” even though it’s no such thing).

This may also touch off a new round of blaming Justin Trudeau for Alberta’s woes, when the oil prices are going to make things so, so much more painful for the province as they budgeted a ludicrously high amount for oil revenues. One might suggest that it would be a good impetus for the province (and the federal government) to redouble efforts toward diversification and a “just transition” away from the oil economy in that province, because the hopes for “just one more boom” get even further away, or even for the province to finally reform the revenue side of its equation and finally implement a modest sales tax that would stabilize its finances – but I have a feeling that Kenney won’t even contemplate those things. Blaming Trudeau is too easy, and lying to the public is so much easier.

Speaking of lying to the public, as certain other political figures fill the op-ed pages with a bunch of bullshit about how Alberta is “treated like a colony” as the Buffalo Declaration did (and no, I won’t link to the egregious op-ed in question), here is a great thread from professor Melanee Thomas as to why that kind of comparison is not only wrong, but wrong to the point of being actively racist.

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Roundup: An abortion bill to position around

The Conservatives’ abortion legislation problem has come home to roost early in the new parliament as MP Cathay Wagantall tabled a bill to ban sex-selective abortions, under the (bullshit) excuse that it reflects Canada’s commitment to gender equality. And because she’s 31 on the order of precedence for private members’ business, this will come up likely late spring or early fall. (Private members’ business is determined by lottery, and arrives on the Order Paper in batches of 30). And all eyes are on Andrew Scheer, who stated during the election that he would vote against any measures to attempt to re-open the abortion debate.

Why does this matter? Because the list of approved candidates for the Conservative leadership closed last night, and social conservatives have played kingmaker in both the last federal leadership contest, as well as the last Ontario one, which was done under the same rules. Already we’re seeing positioning among candidates, such as Erin O’Toole criticizing Peter MacKay for saying he would whip his Cabinet to vote against such a bill, saying that he would never whip anyone, Cabinet or backbench, on “moral issues.” It’s a completely transparent ploy – O’Toole is trying to ensure that he gets second-ballot support from the social conservatives when their preferred no-hope candidates get dropped off of the ranked preferential ballot. That’s how Andrew Scheer won, and it’s how Doug Ford won.

Meanwhile, it looks like it’ll be seven entrants in the race, though some approvals may yet be pending. Of those seven, three qualify as social conservatives, so the “frontrunners” like MacKay, O’Toole and maybe Marilyn Gladu will want the second and third votes from those no-hopers in the hopes of pushing them over the top. So this dynamic is very present in the leadership race, as Wagantall has put it on the table for them to debate around her.

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Roundup: Kenney looking to weaponize populist anger

It was Throne Speech day in Alberta yesterday, and while Kenney temporarily toned down his bellicosity for the sake of decorum, the speech was still full of strange promises. While Kenney promised to reduce unemployment, he nevertheless cited the report he devised to show that spending was too high while ignoring the province’s revenue problem, meaning more cuts are still likely. He also hinted at government investment in resource projects, which is mighty odd for someone who claims to support the free market (and this thread shows some of the context of Peter Lougheed’s investments in the sector which Kenney invoked). He also tabled the first bill, which promises fine for interrupting “critical infrastructure” – such as the rail blockades – because that’ll help.

The one thing that caught my attention most of all, however, was a proposal for recall petitions that would not only target MLAs, but also municipal councillors, mayors, and even school board trustees. I cannot stress enough how boneheaded an idea this is, because it will do absolutely nothing to enhance the practice of democracy, and will in fact weaken the representative democracy – along with their plans to allow citizens to petition referendums on whatever they want. Why they are even more concerning in the current context is because I am certain that this is about Kenney looking to weaponize populist anger against anyone who stands in his way. He has a cadre of paid shitposters, both in his office and in his $30 million a year “war room” that he can deploy against anyone in the province who stands up to Kenney – most especially the mayors of Edmonton and Calgary. Even if there is a high enough bar set to trigger these, as in BC, it nevertheless undermines the practice of Responsible Government and the confidence conventions inherent in our system. We already have accountability mechanisms – they’re called elections. Recall is not only an Americanism that does not fit with our system, I have no doubt that this is about portraying dissent as illegitimate, and using recall legislation as a threat. This will only increase the ugliness that is creeping into our politics, and that Kenney is gleefully throwing these things out there is a very big problem.

Meanwhile, to top it all off, Teck Resources appears to be trolling some particular voices like Kenney who have been caterwauling the past few days, as they announced they are investing in a solar facility at a reclaimed coal mine in BC. Oh, the delicious, delicious irony of it all.

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Roundup: Reverberations and court references

The fallout from the Teck Frontier decision reverberated yesterday, whether it was with disappointed local First Nations, or industry groups giving the usual lamentations about investor confidence. More blame was thrown around, most of it at Justin Trudeau’s direction which seems to be in direct contradiction to what the company’s CEO said in his withdrawal letter, which talked about partisan bickering between levels of government, while also talking about how they supported carbon pricing and the emissions caps – in other words, largely siding with the federal government as the provincial government tore up the comprehensive and reasonable plan that the former NDP government had put into place with a great deal of thought and consultation, which introduced all manner of uncertainty into the market and put them into direct conflict with the federal government unnecessarily – but they also made the gamble that Andrew Scheer would win the last federal election and they wouldn’t have to worry about carbon pricing or strict regulations any longer, and well, that didn’t happen. Of course, it didn’t stop Kenney, Scheer or others from making up things wholesale in order to keep the blame on Trudeau, after they already overly raised expectations for the project (in part by lying about what its promises actually were). In conversation yesterday, a fellow journalist made the supposition that Teck may have been afraid of federal approval at this point because the expectations for it had been built so high when they knew they couldn’t deliver on it, in large part because the price of oil is simply far too low for the project to be viable, not to mention that it’s hard to attract financing as global investors are looking for climate-friendly projects these days.

In pundit response, Heather Scoffield points to the lack of the next stages of the federal climate plans, combined with Alberta’s battling those plans, as factors making us unattractive to investors. Scoffield also blames a lack of leadership for why it’s taking so long to get those needed plans in place. Max Fawcett considers Teck Frontier a metaphor for an Alberta past that won’t come back, and that the withdrawal of the application should be a wake-up call for those who are trying to bring that past back. Kevin Carmichael calls out Teck’s CEO for playing martyr while sabotaging the kind of conversation over energy and the environment that the country needs to have, but now won’t because the deadline is off the table and we have degenerated into assigning blame.

And then, as if things couldn’t get any more interesting, the Alberta Court of Appeal released their 4-1 decision that said that the federal carbon price was unconstitutional, in direct opposition to the decisions from Ontario and Saskatchewan (both of which will head to the Supreme Court of Canada next month). But that being said, there is a curious amount of overtly political editorialising within said judgement, from one of the concurring judges in particular, which I am assured by a law professor will be a field day for the Supreme Court of Canada when this ruling makes it to them.

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Roundup: Open letters and complications

Alberta premier Jason Kenney took the next step in his performance art when it comes to demanding the approval of the Teck Frontier mine, and released an open letter to Justin Trudeau, which reiterated his points for the approval of the project. Of course, he didn’t actually tell the truth with all of those points, which is kind of awkward. (And hey, CBC, you could have done more than just retype Kenney’s letter and actually include some of the pushback, like Andrew Leach’s fact-checking).

Leach also has some problems with the lack of a viable reclamation plan for the project’s end-pit lakes, which is kind of a big deal, because it does seem like they’re trying to handwave away the problem, and hope that maybe in the future they’ll have a magic new technology that will solve the problem. That’s not a good thing. (Thread here).

Meanwhile, the federal decision on the Teck Frontier mine may be complicated as at least one affected First Nation says their concerns aren’t being addressed by the province, which is kind of a big deal. In fact, he said that the federal government has been doing their part, but the province under Kenney’s government has pretty much walked away after the previous government was doing the work with them – hence why they’re calling for the project to only be conditionally approved, with the condition being that the province be given a deadline to complete their talks with the First Nation and addressing their concerns about the impacts that the project (if it goes ahead, which it likely won’t anytime soon) would have on their local environment. It would seem to me that it’s a problem that Kenney keeps insisting they have full Indigenous sign-off on the project if in fact they actually don’t – but the truth hasn’t stopped him at any point thus far.

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Roundup: Kenney’s Washington mistruths

Apparently the lure of trying to wade into American politics was too strong for Jason Kenney to resist over the weekend, and he joined Doug Ford in taking swipes at Democratic Party hopefuls over the Keystone XL issue, before telling a Washington audience that Justin Trudeau’s former principal secretary, Gerald Butts, had conspired with the Obama administration to kill the Keystone XL pipeline – which is funny, because it was during the Harper government, and Trudeau has been on the record of being fully supportive of Keystone XL the whole time. Kenney’s Mini-Me, Scott Moe, insisted that this fable was “absolutely correct,” which is a lie in and of itself. And of course, people brought their receipts.

Of course, Kenney has nothing to fall on but lies about the state of the oil industry in order to keep the attention off of himself and his government’s failings in trying to manage the shifting economy – and his convenient target is always Justin Trudeau, whom he needs to keep his voters angry at as a means of distraction. That said, his audience laps it up, and that has pretty much eliminated any sense of shame that Kenney had left. There was a piece in this weekend’s tablet edition of Maclean’s that interviewed so-called “Wexit” supporters, and they all repeated the same memes and lies that Kenney and company peddle, along with a healthy amount of self-delusion, that Kenney also stokes by way of his rank dishonesty. He is continuing to play with fire, as he feels he’s clever enough to put it out and be declared a hero before it gets too big, and trying to do it from Washington is not only a sign of hubris, but possibly of his own desperation.

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Roundup: Escalating costs for compliance

The over-the-top rhetoric over energy projects in this country hasn’t been limited to the Teck Frontier mine decision. No, we got a new round of it yesterday when Bill Morneau disclosed that the Trans Mountain expansion pipeline costs have increased to $12.6 billion, in part because of environmental changes and accommodations for local First Nations. Predictably, both the Conservatives and project opponents lost their minds – the Conservatives melting down that this was somehow because of this government’s delays (erm, you know there were court processes in between, right?), apparently oblivious to the fact that this was the cost of compliance to get it built; the opponents because of the increased price tag over a project that they are certain will increase carbon emissions (even though it is more likely to decrease them as those contents would simply flow by rail otherwise). Jason Kenney, of course, takes the cake for his own outsized rhetoric on the matter.

From Washington DC, Kenney and his Mini-Me, Scott Moe, were both being remarked upon for how toned down their rhetoric has been of late (which I contend has to do with Trudeau and Freeland calling their bluff on their “equalization” bullshit), but they certainly kept up it up around Teck Frontier, and Alberta’s environment minister was thundering about the news reports of a possible federal “compensation package” if the approval was not granted – which was, of course, full of lies about the merits of the Teck proposal. And the notion that the federal government simply needs to “get out of the way” pretends that the biggest woes are the price of oil, and the fact that the US shale boom has hobbled the viability of the oilsands.

Meanwhile, Heather Scoffield makes note of the fact that all reason has gone out of the “debate” over the approval of the Teck Frontier mine. As if to illustrate the point, Matt Gurney repeats a bunch of the well-worn justifications for approving the project under the notion that Alberta needs jobs and not bailouts, without seeming to recognize that it’s not currently economically viable, while ignoring that delays to TMX were not because of government action but Indigenous court challenges under their constitutional rights, or that there is a reason why the Conservatives ensured there was Cabinet sign-off on these decisions. Chantal Hébert points out that the Liberals will lose whichever way they decide on this project.

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Roundup: Freeland on tour

For the past two days, Chrystia Freeland has been in Alberta to talk to the mayors of Edmonton and Calgary, as well as premier Jason Kenney, and she is continuing her tour there today, heading to the north of the province, where she grew up. There have been a couple of themes emerging from her tour from those she’s visited – from the mayors, it’s a sense that it’s great that she’s there to listen and hear their concerns, and from Kenney, it’s a bit of a sense of impatience that there haven’t been enough “concrete” actions yet.

I was struck after the meeting with Edmonton’s mayor on Monday about the talk of his trepidation that Kenney’s “Fair Deal” plans would make it harder for cities to deal with the federal government to address their priorities, and that he was looking for some particular assurances – and indeed, we’ve heard for the past couple of years that cities were frustrated that federal dollars weren’t flowing because the provinces were holding things up in what appeared to be some partisan pique (given that most of those provinces now have conservative governments). The federal government has been looking at more ways to deal with cities directly, and this appears to be more confirmation of the need to do just that.

This having been said, I am curious as to when Freeland is going to start further calling Kenney’s bluffs with regard to his “demands” and his threats around them. Justin Trudeau fairly effectively cut the legs out from under Scott Moe’s equalization fairy tales, and one imagines that it’s a matter of time before Freeland starts to – very diplomatically – do much the same with Kenney and some of his utter nonsense. Those “concrete actions” Kenney wants – retroactive fiscal stabilization funds, unrealistic demands related to the former Bills C-48 and C-69 (which are now law) – will eventually need to come to a head and Kenney will huff and puff and claim separatist sentiments will explode, but he doesn’t have too much room to manoeuvre himself – his cuts have proven very unpopular, and the patience of his constituents is going to run out, no matter how much he tries to distract them by fomenting anger at Ottawa. Freeland knows this, and I’ll be curious to see how she manages it.

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Roundup: Competing economic illiteracy

As someone who covers a fair bit of economic stories, the absolute inability of this government to come up with a definition of “middle class” is exhausting – and those of you who read me regularly will know that I will instead use Middle Class™ as a means of showcasing that it’s a meaningless branding exercise. And lo and behold, when challenged to offer up a definition during one of his year-ender interviews, Justin Trudeau said that “Canadians know who’s in the middle class and know what their families are facing and we focus more on the actual issues.” And I died a little bit inside. For a government that keeps insisting they’re all about data, and evidence-based policy, their refusal to offer a meaningful measure of what their core narrative is all about is entirely about branding. By not offering a definition, they don’t have to exclude anyone – because everyone believes they’re middle class (whether they had ponies or not). And more to the point, by not offering a metric, they can’t measure whether they’ve succeeded for failed – it’s only about feelings, which makes their talk of data and evidence all the more hollow.

And then there’s Pierre Poilievre, who, when challenged about the definition of a recession, makes up a bullshit response and thinks it makes him clever. It’s as economically illiterate as the Liberals’ Middle Class™ prevarication, but the fact that the Conservatives keep cheerleading a “made-in-Canada recession” that no economist sees on the horizon, and which they can’t even fit into the actual definition of what a recession is (two consecutive quarters of negative GDP growth) sets a dangerous path of spooking markets. It’s all so stupid, and reckless, but the party’s current path of pathological dishonesty makes them blind to the danger of it all.

On perhaps a related note, Trudeau’s director of communications, Kate Purchase, is leaving to become a senior director at Microsoft, and good luck to her – and she really is one of the nicest staffers and was actually helpful to media in stark contrast to the Harper crew. But I also hope that perhaps this means that her replacement can start ensuring that this government can start communicating its way out of a wet paper bag, because cripes, they have done themselves zero favours over the past four years.

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