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Opinion

PM Trudeau’s “Monetary Policy” gaffe could cost the Liberals the election. But will it?

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Back in 1993 things were not going well for Canada’s Progressive Conservative Government.  Brian Mulroney’s government had served 2 mandates and Canadians were clearly ready to move on.  The Conservatives decided Kim Campbell would be the best leader to bring a renewed excitement to their reelection hopes.  Campbell was a fresh face and that was important to the party which was losing support quickly.  She was also from Vancouver, which was a nice change for the party normally represented by leaders from Ontario or Quebec.  Even more importantly, when she won the leadership she would become the first female leader of a country in North America.  As Canadians would discover just a few months later though, no one cared about any of that.  That campaign did not go well.  The Conservatives not only lost.  They were decimated right out of official party standing.  The governing party won just 2 seats in the entire nation (Jean Charest in Quebec, and Elsie Wayne in New Brunswick). Kim Campbell did not even win her own seat.  Henceforth the Reform Party represented the Conservative voice for the next two elections.

For one reason or another, Canadians simply did not connect with Kim Campbell.  One of the biggest gaffes of that election campaign came when a reporter pressed Campbell for details on an issue and she replied “The election is not a time to discuss serious issues.”  That was the wrong answer.  Despite what she may have truly meant, all Canadians heard was “I don’t need to explain anything to you.”.  That was exactly the wrong thing to say at the worst possible time.

Why bring this up now, 28 years later? Well Prime Minister Justin Trudeau has made his first major gaffe of this election campaign.   And for those who care about monetary policy (which should be everyone who pays taxes and works or has savings, etc) it’s very likely as stunning a statement as Kim Campbell made three decades ago.

First some background.  In 2021, Canadians find themselves in an astounding situation.  When the covid pandemic hit last year governments all over the world shut down their economies for weeks, and then months.  Government stimulus was the order of the day and Canada’s was among the most generous in the world.  People were paid to stay at home.  Businesses were paid to continue to provide jobs to people working from home.  Landlords were paid to keep tenants afloat.  All in all, government money is being spent at unprecedented rates.

To pay for all this the Trudeau government attempted to pass a bill through Parliament which would allow it to raise taxes at will without a budget and without even coming back to ask Parliament to present a plan or ask for approval.  That didn’t go over so well.  But instead of turning back the taps, or introducing a budget with higher taxes the government worked out a plan with the Bank of Canada.  How this works basically is that every month the Bank of Canada prints out a few billion dollars, and the government uses that to pay for all the stimulus they want.  Over the first year of covid that totalled about 350 Billion dollars!

The Bank of Canada has left the core function expressed in its mandate in order to print all this extra money.  Despite it’s best efforts to decouple inflation from the printing of extra money, it’s not working.  Canada’s inflation rate has been blowing through the target of 2% month after month after month.

This is the the mandate as expressed by the Bank of Canada itself on its website.

The Bank of Canada is the nation’s central bank. Its mandate, as defined in the Bank of Canada Act, is “to promote the economic and financial welfare of Canada.” The Bank’s vision is to be a leading central bank—dynamic, engaged and trusted—committed to a better Canada.

The Bank has four core functions:

  • Monetary policy: The Bank’s monetary policy framework aims to keep inflation low, stable and predictable.
  • Financial system: The Bank promotes safe, sound and efficient financial systems within Canada and internationally.
  • Currency: The Bank designs, issues and distributes Canada’s bank notes.
  • Funds management: The Bank acts as fiscal agent for the Government of Canada, managing its public debt programs and foreign exchange reserves.

The Bank of Canada’s mandate is expiring at the end of this year and the new mandate could change.  Some are saying the Bank should continue to print money at an unprecedented rate and Canadians will learn to live with high inflation.  Considering this drives up the cost of everything from our homes and vehicles, to the food we eat there could hardly be a more important issue.  That’s why PM Trudeau’s response to this question in Vancouver this week is so stunning.  When asked if he would consider a higher tolerance for inflation going forward here’s what he said.

 

Reporter Question about the renewal of the Bank of Canada mandate due at the end of 2021:

-Do you have thoughts about that mandate?  Would you consider a slightly higher tolerance for inflation?

Prime Minister Justin Trudeau: “When I think about the biggest, most important economic policy this government, if re-elected, would move forward, you’ll forgive me if I don’t think about monetary policy.” 

Of course this spurred an immediate reaction from the opposition Conservatives.  That oppostion is perhaps best summed up in this address from Pierre Poilievre.

The question is, will Canadians punish Prime Minister Trudeau for either lacking basic economic knowledge, or not caring about it?  Kim Campbell failed to win her own seat, but she did not seem to connect well with Canadians at all even before that election campaign.  Justin Trudeau has so far been immune to gaffes.  Even though he’s had more than 5 years in government, millions of Canadians stand by him loyally.  Will this time be any different?

After 15 years as a TV reporter with Global and CBC and as news director of RDTV in Red Deer, Duane set out on his own 2008 as a visual storyteller. During this period, he became fascinated with a burgeoning online world and how it could better serve local communities. This fascination led to Todayville, launched in 2016.

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Energy

Canada Has All the Elements to be a Winner in Global Energy — Now Let’s Do It

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Mike Rose is Chair, President and CEO of Tourmaline Oil Corp.

From EnergyNow.ca

By Mike Rose of Tourmaline Oil Corp.

There has never been a more urgent time to aggressively develop Canada’s massive resource wealth

There has never been a more urgent time to aggressively develop Canada’s massive resource wealth. An increasingly competitive world is organizing into new alliances that are threatening our traditional Western democracies.

Weaker or underperforming countries may be left behind economically and, in some cases, their sovereignty may be compromised. We cannot let either scenario happen to Canada.

Looking inward, our country has posted among the weakest economic growth of all G20 nations over the past decade — we are at real risk of delivering a materially diminished standard of living to our children and subsequent future generations.

Canada is blessed with one of the largest and most diverse natural resource endowments in the world. It’s not just oil and gas; it’s uranium, precious metals, rare earth elements, enormous renewable forests, a vast fertile agricultural land base and, of course, the single-largest freshwater reserve on the planet.

This is nothing new; Canada has been regarded as a resource-extraction economy for a long time, but over the past two decades we’ve been slowing down and finding reasons to not advance new projects. While looking ahead to an exciting new future economy is enticing, the majority of our easily accessible resource wealth remains largely untapped. Our Canadian resource sectors are the most capital-efficient, technologically advanced and environmentally responsible in the world. We’ve got the winning combination.

Canada has among the largest, lowest-cost natural gas reserves in the world — we’re already the fourth-largest producer. With consistent regulatory support, we can rapidly evolve into a leader in the growing global LNG business.

This country produces among the lowest-emission natural gas in the world and technology adaptation is widening the gap. A 10 bcf/day Canadian LNG industry targeted to displace coal-fired electrical generation in Asia would offset the vast majority of emissions from the entire domestic oil and gas industry. Contemplating a cap on the Canadian natural gas industry is actually damaging to the global environment, as growing demand will be met by jurisdictions with higher associated emissions.

As developed economies look at electrification to accelerate emissions reduction, nuclear power is becoming increasingly attractive. Canada is already one of the largest uranium producers in the world and has long possessed one of the most efficient and safest reactor designs. This is an advantage we created for ourselves several decades ago; it’s time to harvest this opportunity.

The rare earth elements required for a growing solar industry and battery requirements associated with electrification are abundant in certain regions in Canada — for example, a large new mining opportunity is emerging in Ontario. We should make that happen. One of the great outcomes of accelerating our multi-sector resource opportunity is that the economic benefits will be enjoyed across the country; all Canadians will share in it.

The Canadian agricultural industry has been long regarded as a world leader in efficiency, yield and technical innovation. Global food security and affordability are rapidly emerging issues, and Canada has a role to play here, as well. Not only could we make it more attractive for Canadian producers to grow output and explore novel new transportation corridors to feed more of the world, we have a large, well-established, globally competitive fertilizer industry.

There are many more future resource wealth opportunities we could be capitalizing on. The list is as long as the imagination of our well-educated and entrepreneurial resource sector workforce.

Enormous amounts of capital are required for these projects, and that global capital is most certainly available. These pools of capital will flow into Canada if we demonstrate a willingness to consistently support the Canadian resource sector at provincial and federal government levels.

Accelerating domestic multi-sector resource development provides solutions to many of the problems currently facing Canada. We’ll be playing to strengths that we have established and evolved over many decades. We are the most efficient and technologically advanced in the full spectrum of resource development. Adoption and innovative adaptation of the continuous march of technology advancements will only make us better.

To paraphrase: We can take advantage of what’s between our ears to do an even better job of developing what’s beneath our feet.

Mike Rose is Chair, President and CEO of Tourmaline Oil Corp.

In an ongoing monthly series presented by the Calgary Herald and Financial Post, Canadian business leaders share their thoughts on the country’s economic challenges and opportunities.

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Alberta

Coutts Three verdict: A warning to protestors who act as liaison with police

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From the Frontier Centre for Public Policy

By Ray McGinnis

During the trial numbers of RCMP officers conceded that the Coutts Three were helpful in their interactions with the law. As well, there didn’t seem to be any truth to the suggestion that Van Huigenbos, Van Herk and Janzen were leaders of the protest.

Twelve jurors have found the Coutts Three guilty of mischief over $5,000 at a courthouse in Lethbridge, Alberta. Marco Van Huigenbois, Alex Van Herk and George Janzen will appear again in court on July 22 for sentencing.

Van Huigenbois, Van Herk and Janzen were each protesting at the Coutts Blockade in 2022. A blockade of Alberta Highway 4 began on January 29, 2022, blocking traffic, on and off, on Alberta Highway 4 near the Coutts-Sweetgrass Canada-USA border crossing. The protests were in support of the Freedom Convoy protests in Ottawa.

Protests began due to the vaccine mandates for truckers entering Canada, and lockdowns that bankrupted 120,000 small businesses. Government edicts were purportedly for “public health” to stop the spread of the C-19 virus. Yet the CDC’s Dr. Rachel Wallensky admitted on CNN in August 2021 the vaccine did not prevent infection or stop transmission.

By February 2022, a US court forced Pfizer to release its “Cumulative Analysis of Post-Authorization Adverse Event Reports” revealing the company knew by the end of February, 2021, that 1,223 people  had a “case outcome” of “fatal” as a result of taking the companies’ vaccine.

On the day of February 14, 2022, the three men spoke to Coutts protesters after a cache of weapons had been displayed by the RCMP. These were in connection with the arrest of the Coutts Four. Van Huigenbos and others persuaded the protesters to leave Coutts, which they did by February 15, 2022.

During the trial numbers of RCMP officers conceded that the Coutts Three were helpful in their interactions with the law. As well, there didn’t seem to be any truth to the suggestion that Van Huigenbos, Van Herk and Janzen were leaders of the protest.

RCMP officer Greg Tulloch testified that there were a number of “factions” within the larger protest group. These factions had strong disagreements about how to proceed with the protest. The Crown contended the Coutts Three were the leaders of the protest.

During his testimony, Tulloch recalled how Van Huigenbos and Janzen assisted him in getting past the “vehicle blockade to enter Coutts at a time during the protest when access to Coutts from the north via the AB-4 highway was blocked.” Tulloch also testified that Janzen and Van Huigenbos helped with handling RCMP negotiations with the protesters. Tulloch gave credit to these two “being able to help move vehicles at times to open lanes on the AB-4 highway to facilitate the flow of traffic in both directions.”

During cross examination by George Janzen’s lawyer, Alan Honner, Tulloch stated that he noticed two of the defendants assisting RCMP with reopening the highway in both directions. Honner said in summary, “[Marco Van Huigenbos and George Janzen] didn’t close the road, they opened it.”

Mark Wielgosz, an RCMP officer for over twenty years, worked as a liaison between law enforcement and protesters at the Coutts blockade. Taking the stand, he concurred that there was sharp disagreement among the Coutts protesters and the path forward with their demonstration. Rebel News video clips “submitted by both the Crown and defence teams captured these disagreements as demonstrators congregated in the Smuggler’s Saloon, a location where many of the protesters met to discuss and debate their demonstration.” Wielgosz made several attempts to name the leaders of the protest in his role as a RCMP liaison with the protesters, but was unsuccessful.”

However, the Crown maintained that the protest unlawfully obstructed people’s access to property on Highway 4.

Canada’s Criminal Code defines mischief as follows in Section 430:

Every one commits mischief who willfully

(a)  destroys or damages property;

(b)  renders property dangerous, useless, inoperative or ineffective;

(c)   obstructs, interrupts or interferes with the lawful use, enjoyment or operation of property; or

(d)  obstructs, interrupts or interferes with any person in the lawful use, enjoyment or operation of property.

Robert Kraychik reported that “RCMP Superintendent Gordon Corbett…cried (no comment on the sincerity of this emoting) while testifying about a female RCMP officer that was startled by the movement of a tractor with a large blade during the Coutts blockade/protest.” This was the climax of the trial. A tractor moving some distance away from an officer in rural Alberta, with blades. The shock of it all.

No evidence was presented in the trial that Van Huigenbos, Van Herk and Janzen destroyed or damaged property. Officers testified they couldn’t identify who the protest leaders were. They testified the defendants assisted with opening traffic lanes, and winding down the protest.

By volunteering to liaise with the RCMP, the Crown depicted the Coutts Three as the protest leaders. Who will choose to volunteer at any future peaceful, non-violent, protest to act as a liaison with the policing authorities? Knowing of the verdict handed down on April 16, 2024, in Lethbridge?

Ray McGinnis is a Senior Fellow with the Frontier Centre for Public Policy. His forthcoming book is Unjustified: The Emergencies Act and the Inquiry that Got It Wrong.

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