Links - 5th May 2025 (Canadian Federal Election 2025/Mark Carney)

Immigrants denied Carney his majority - "The immigrant vote, long considered a reliable vote store for the Liberal Party, is quickly emerging as an important factor in having denied Prime Minister Mark Carney his expected majority.    Not only did immigrants break for the Tories in any number of pre-election polls, but immigrant-heavy ridings were the most likely to see their share of the Conservative vote increase as compared to 2021...   The Economist concluded that while Canada’s 2025 election yielded effectively the same result as in 2021, underneath the surface the country had undergone an electoral realignment similar to what’s occurred in the United States. “Just as in the United States, working-class and immigrant voters swung right,” wrote the publication... The B.C. Conservatives experienced a similar phenomenon in their own election...    The 2025 election thus represents one of the few times in Canadian history where the average 25-year-old was more likely to vote Conservative than the average 65-year-old — and where the average immigrant was more likely to vote Conservative than the average native-born Canadian.   As to why both groups are shifting right at the same time, one explanation is that both have been disproportionately vulnerable to the decline in living standards that has defined Canada’s last 10 years, particularly in the area of housing affordability...    New Canadians have also started to emerge as prominent opponents of some of Canada’s more liberal social policies, including harm reduction, repeat bail for chronic offenders and even lax integration of other immigrants...   “They value family, faith, entrepreneurship, and community order,” wrote Coletto. “For many, the Liberals’ progressive stances on gender, parental rights, and criminal justice reform felt out of touch.”" Jamie Sarkonak: Mark Carney's election win already has economists worried - "Fitch Ratings, one of the great deciders of how much interest Canada pays on its debt, flapped a warning flag in our faces for electing Prime Minister Mark Carney the night before. “Canada’s credit strengths offer significant headroom to weather a fiscal or economic shock,” wrote the ratings agency, “but increased structural deficits would pressure its credit profile.” Fitch had already priced in federal government deficits for 2025 and 2026, amounting to 2.6 per cent and 2.4 per cent of Canada’s GDP, respectively. Factoring in the Carney platform, though, resulted in even worse figures: the 2025 deficit is now slated to be 3.1 per cent of GDP, growing to 3.2 per cent in 2026. For context, the federal deficit between 2000 and 2019 ran at 0.4 per cent of Canada’s GDP. The Carney plan takes us to eight times that. Plus, he has the hurdle of a new Parliament, with new political dynamics. “As a minority government,” Fitch cautions, “the Liberals will have to compromise with other parties to pass legislation, increasing the likelihood that enacted policies will differ from the platform.”... Morningstar, the American financial services firm, figured that the housing situation in Canada won’t be sorting itself out with all the red tape and trade uncertainty; Carney’s plan to remove GST from homes bought by first-time buyers “may drive improved demand but exacerbate the same housing problem they are trying to solve,” making matters worse. This bodes very poorly for Canada, which is already in a bad place. GDP, the measure of our country’s objective output, has been limping upward. Divide that by population, which has been growing relentlessly under the Liberal government, and it looks much worse. GDP per capita fell for six consecutive quarters, only to slightly improve in the subsequent, and most recent, quarter. A recession is reached when a country has seen at least two consecutive quarters of negative growth — but since that usually refers to a decline in total GDP, Canada has narrowly avoided the label. In February, CIBC Deputy Chief Economist Benjamin Tal didn’t bother sugarcoating it with labels: “Let me break it to you: we are in a recession — a per-capita recession,” he told a real estate forum in Toronto. How bad we’re doing on a per-capita basis depends on your reference time period. Going back to 1981 and following up to 2024, the economy grew per capita at an average rate of 1.1 per cent, says Statistics Canada. Only now, this growth has since flattened, leaving our post-pandemic GDP per capita seven per cent below what it otherwise would have been: in the last quarter of 2023, GDP per capita was $58,111; had we remained on the 40-or-so-year trend, it would have been $62,356. We’re at a point where catch-up games will need to be played for years to return the economy to what it once was... We’ve read what Carney had in store and it was bad; worse, even than the trajectory under former Prime Minister Justin Trudeau.” Canada’s AA+ rating from Fitch — and high praise for its stability — haven’t been downgraded by the agency just yet, but it’s certainly looking like it’s headed that way. Instead of ignoring it, it should be taken as a last warning. Unheeded warnings are par for the course in Canada, though, so it’s doubtful we’ll ever see that blimp turned around. The same, we can probably say for, on the trade front: Carney, despite baselessly maligning Conservative Leader Pierre Poilievre by telling followers that he “worships at the altar of Donald Trump,” and declaring the “relationship we had with the U.S.” to be over, is already warming up to President Donald Trump. Trump praised Carney on Wednesday, reportedly saying on a call with the Canadian prime minister that “we’re going to have a great relationship.” Despite the Liberal campaign’s constant invocations of Trump, the president was happy with the election result because, between the two candidates for prime minister, “They both hated Trump, and it was the one that hated Trump, I think, the least that won. I actually think the Conservative hated me much more than the so-called Liberal.”"
A "good economist" with bad policies is not a good economist. But a lot of people are taken in by 'qualifications' rather than achievements Opinion: Carney’s accounting change reduces transparency, accountability - "The government plans to separate federal spending into two budgets: operating and capital. Government salaries, cash transfers to the provinces and to individual Canadians (e.g., Old Age Security) will fall within the operating budget, while spending on “ anything that builds an asset ” will count as capital. The government plans to balance the operating budget by 2028-29 but fund increased spending within the capital budget with more borrowing.According to the Liberal Party platform , this accounting change will “create a more transparent categorization of the expenditure that contributes to capital formation in Canada.” In reality, it will muddy the waters, making it harder to evaluate the true state of federal finances... Mark Carney’s deficit-spending plan for the next four years dwarfs Justin Trudeau’s, and Trudeau was the biggest spender (per-person, inflation-adjusted) in Canadian history. That will add almost $100 billion more to Canada’s mountain of federal debt. Yet Prime Minister Carney has tried to sell his plan as more responsible than his predecessor’s... Carney’s definition of “capital spending” remains vague. Instead of limiting this spending to direct investments in long-term assets such as roads, ports or military equipment, the government will also include in the capital budget “ new incentives ” that “support the formation of private sector capital (e.g. patents, plants, and technology) or which meaningfully raise private sector productivity.” In other words, corporate welfare. In fact, any government subsidies to corporations — as long as they somehow relate to creating an asset — could potentially land in the same spending category as new infrastructure spending. Not only would this be inaccurate but such a broad definition means the government could potentially balance the operating budget, not by reducing spending, but simply by shifting it over to the capital budget. This would add to the debt but allow the government to pretend to be practicing “responsible” budgeting. To increase transparency, rather than split federal spending into two budgets the Carney government could give provide additional breakdowns of line items into “operating” and “capital” within the existing budget framework. Then Canadians could decide for themselves whether the government’s accounting was politically self-serving or helpfully clarifying." Carney's trick shouldn't fool anyone that future will be rosier - "generally accepted accounting principles (GAAP) were born. Each country has slightly different principles and reporting requirements that encompass GAAP, but, for the most part, GAAP is GAAP around the world. In other words, accounting principles have not changed much over the centuries since the foundational accounting equation has not changed.  However, accounting principles can be malleable and flexible. One of the most common manipulations is the classification of assets versus expenses... Alberta’s provincial government attempted this kind of budgeting exercise in 2013 and then-disastrous premier Allison Redford was thoroughly and rightfully roasted for this lame attempt to make the numbers look better.  There are other examples in recent history. Former United Kingdom chancellor (and later prime minister) Gordon Brown deployed this trick with his version of the Golden Rule from 1997 to 2009, hiding massive overspending and debt accumulation by keeping such amounts away from the operational budget. The same occurred in Greece before the 2008 financial crisis.   History shows that when politicians use this approach, it often leads to debt spiralling out of control.  What about Carney’s claims that such an approach would lead to personal tax cuts? Well, keep dreaming.  Any Canadian who falls for this promise should do themselves a favour and take a basic accounting course. Again, if you move expenditures off the budget into a capital budget, that does not reduce cash outlays. For governments, it means piling up debt.  If the spending gets too out of control (like it has in Canada), it leads to inflation, a stealth tax that slams the poor the hardest. Governments can only pay for spending increases by raising taxes and/or significantly reducing expenditures — operational and capital. Reduced personal taxes? I’ll believe that when Pacioli comes back from the dead and develops a new accounting equation.  Famous U.S. economist William Niskanen in his 1971 book, Bureaucracy and Representative Government, said, “The separation of current and capital budgets permits the executive and legislative branches to present a partial picture of fiscal policy that conceals the aggregate growth of public expenditure.”" Mark Carney has a housing plan. How long will it take to implement? - "Housing experts and economists say some of the proposed measures are promising, but some key challenges remain. And some measures will take a lot longer to implement than others. “Doubling the rate of building housing is extremely important because Canada has been under-building for nearly two decades and during this two decades population has been going up,” said Tu Nguyen, economist at RSM Canada. She added, “It's extremely ambitious to say that you are going to build 500,000 homes. Is it achievable? Maybe. It will not be easy.”... Much of the construction in the post-war years was done by a Crown corporation called Wartime Housing Canada, which later became the Canada Mortgage and Housing Corporation (CMHC). Federal Crown corporations are established either by a special Act of Parliament or by articles of incorporation under the Canada Business Corporations Act. But creating a Crown corporation from scratch would be gargantuan undertaking, one that will need a lot of work even after it is approved by Parliament. “When [CMHC] was involved in direct delivery of various programs back in the '70s, '80s and '90s, they established a network in the early post-war period of 96 branch offices across the country, staffed with architects, engineers, building inspectors, loans officers, underwriters, and so on,” Pomeroy said, adding that it could take years for Ottawa to recreate that scale. He said, “I can't imagine how at a single federal agency, you would actually be able to emulate that kind of support for local development.” This new agency would essentially act as a developer and, according to the Liberal platform, “develop and manage projects and partner with builders for the construction phase of projects.”... All major political parties agree that Canada needs to build more homes faster, but there are few answers on who will be building the homes. The Canadian Construction Association estimates that the industry is short by around a million workers. It is unclear where the parties plan to meet the demand for more workers." Adam Pankratz: Too many Canadians happy with Liberal decline - "Canadians voters asked for more of the same thin policy gruel from our own political beadles by sending the Liberals back to power for a fourth term. A decade of lost economic prosperity, denigration of national pride and failed immigration policy was ultimately not enough to turn the stomachs of the voting public... By nearly every metric the country is doing worse now than in 2015. Canadians feel less pride in their country. Our GDP growth per capita is second to last among OECD countries and total GDP per capita is equivalent to the poorest American states. Since 2015, Canada has been undeniably getting poorer, indeed, had our economy stuck to the 2015 baseline trends, we’d all be $4200 per year richer. Crime, including violent crime and drug abuse, are up. Finally, in perhaps the saddest result of all, young Canadians feel hopeless about their prospects of owning a home as prices have skyrocketed, with the average housing price getting more expensive by $43 dollars per day, every day, since the Liberals came to office; adjusted for inflation that’s an increase of over $150,000 for new homebuyers.   These are not the statistics we would normally associate with a populous demanding more of the same. And yet Canadians have just rewarded the Liberals a fourth term. We may search for other answers, but ultimately this vote reflects the fact that a great many Canadians are happy with our decline... This election Canadian voters, specifically Liberal voters, appear to have ignored every domestic indicator of success in favour of threats from a bombastic president down south when deciding how to cast their ballot.  While by now there is little doubt that Donal Trump was the wild joker factor in this election, some Canadians seem to have forgotten is that the U.S. president was nowhere to be found on any ballot across the country despite his larger unavoidable presence. Trump is a problem, no doubt there. But the larger reason Trump can threaten us so well is that we have been collectively weakened by poor governance for nearly a decade... In the aftermath of Trump’s election and threats of tariffs and annexation, Justin Trudeau went on CNN, and when asked what it meant to be Canadian, he said “We’re not American.” Mark Carney did not offer a more convincing answer during the campaign. Is that really all we can muster as a country and message? We’re just not Americans? Sadly, this vote is giving us a sense that a great many Canadians feel that is all we’ve got... Anyone who voted Liberal must believe Carney represents a meaningful and significant shift in economic and energy policy, as well as in national defence. These buildouts must happen. If sharp and decisive change does not happen in these areas, it does not matter who Canadians may or may not think is best to deal with Donald Trump as our country only continue to weaken.   So far, the indicators are not good. Carney has promised to keep Bill C-69, otherwise known as the Impact Assessment Act, and the emissions cap on the oil and gas industry. The day after the election Bloc Québécois leader Yves-François Blanchet (who’s support Carney may well need) stated there was “no future for oil and gas, at least in Quebec and probably everywhere.” Canadian energy dominance? I’ll believe it when I see it."
Left winger logic is that Canada still ranks highly on several metrics, so the country is not broken even if the direction is downward, or that rising crime isn't a problem since it's still lower than in the 90s. Yet they are outraged if 'rights' that have only been invented in recent years are taken away
One lost decade was not enough for boomer voters Conservatives back Poilievre, but need changes to avoid 'problems' - "Poilievre led the party to an additional 24 seats, including breaking through in the Greater Toronto Area. Supporters point to how he delivered on bringing a new coalition to the party, comprised of young people and those in the blue-collar trades." Randall Denley: Attacking Poilievre's Conservatives will come back to bite Doug Ford - "Ford is willing to work with federal Liberals when it furthers his political interests. He shouldn’t have let his disdain for Poilievre prevent him from doing the same with Conservatives. During the campaign, Poilievre took a tough-on-crime approach. Ford didn’t speak up to support him. Now that the election is over, Ford spent this week laying our new additions to his crime policy, one that is in sync with and arguably more severe than anything Poilievre advocated for. Couldn’t the two have worked together on that issue, at least? The Liberals will never give Ford what he wants on crime. On Wednesday, Ford went on a remarkable, self-described “rant” about “bleeding heart” judges who make decisions based on ideology — an ideology different from his own. The premier was annoyed that unelected judges would have any right to say no to his elected government on tougher crime policies, because “the people are supreme.”... If conservatives want future political success, their federal and provincial leaders will need to grasp the fact that they have more in common with each other than they do with the Liberals. At both levels, conservatives face a common threat. The collapse of the NDP in this federal election has fundamentally changed federal politics. If there aren’t two viable parties splitting the left-wing vote, Conservatives will face Liberal win after Liberal win. The problem is starkly apparent federally, but it’s happening provincially, too. In this year’s Ontario election, the provincial NDP support dropped to 18.5 per cent while the Liberals rose to 30 per cent. If the Ontario NDP continues to crumble, Ford or his successor will have a big problem. It’s time for conservative politicians to wake up and work together." Carson Jerema: Pierre Poilievre didn't stand a chance - "The government claimed Trump’s threats constituted a crisis, but Trudeau responded by resigning on Jan. 6, and proroguing Parliament, bending the apparatus of government for partisan aims to give the Liberals a chance to select a new leader ahead of an election. Given that Trudeau was certain to lose a confidence vote, it is questionable whether he had a right to make that move in the first place. The Liberal manipulations did not end with prorogation. Once Trump’s tariffs appeared to be imminent, Trudeau avoided calm attempts at negotiation, exploited the “crisis” to insult the U.S. president, blathered on in nationalistic platitudes, and started hinting at COVID-style income supports. While negotiations were, no doubt, going on between Canada and the U.S., rather than convene Parliament to face questions from the opposition, and to debate possible responses to the Americans, Trudeau kicked into campaign mode , delivering his successor a massive assist. The longer the Trump crisis persisted, the better positioned Liberals would be in any election. Although the opposition parties had promised to bring the government down, the former prime minister should have faced Parliament to at least try and get support for his agenda. This was to become a bit of a habit for the Liberals. Once Carney succeeded Trudeau in March, rather than meeting the House of Commons, he made multiple policy changes and flew to Europe to meet with government leaders in the U.K. and France, both of which he arguably had no right to do. Because Carney swore in a new cabinet, which had never tested the confidence of the House, some constitutional experts believed the prime minister should have been following the rules of caretaker government, which are normally reserved for election periods. They limit the prime minister to duties that are urgent or absolutely necessary. Even when the election was underway, Carney failed to respect these conventions, pausing his campaign three times to deal with Trump’s upending of free trade. By the third time Carney put his campaign on hold, there were no new tariffs or fresh threats from Trump. In fact, the tensions between the two countries had significantly decreased by then, but that didn’t deter Carney. He wanted to appear to be governing in a crisis, even a dissipating crisis. To top it off, a carbon tax rebate was deposited into bank accounts less than a week before the vote. The Liberals were able to set the carbon tax to zero, and claim they were saving Canadians money, while still depositing one final rebate ahead of election day. The Liberal state always wins." Terry Newman: Mark Carney won on phoney values. They won't fix Canada - "That lack of certainty about the size of his win didn’t stop Carney from taking a shot at Pierre Poilievre, whose seat was still in play at the time, not finalized due to an oversized ballot in Carleton. And he did this, ironically, only breaths apart from suggesting he has the values Canadians need, including kindness and humility. And because he spoke in a tone acceptable to Liberal Canadian sentiments, it didn’t seem to draw much, if any, criticism from election night pundits. He has convinced a large enough swath of the Canadian populace that we are at war with our American neighbours that such inherent value contradictions in himself and our country have ceased to be important.    Carney placed a heavy emphasis on Canadian values, the existence of which was ridiculed by the Trudeau Liberals when they entered the scene in 2015. This was taken up by CBC at the time, who appeared to take great joy in mocking then Conservative leadership hopeful, Kellie Leitch, for the mere suggestion they might exist, oh, and for the way she spoke. Ironic, given the uproar that was made, rightfully, by the Liberals and the rest of Canadians when a 1983 PC attack ad made fun of former prime minister Jean Chrétien for similar reasons. The CBC, no doubt, celebrated Carney’s win on election night. How could they not? He called them “underfunded,” promising them $150 million in his platform. Until it was clear there was at least going to be a Liberal minority after 10 p.m., they were unsure whether or not the election outcome meant they’d have to be delivering their own eulogy, as Conservative Leader Pierre Poilievre had campaigned on defunding the broadcaster.   Why did the Liberals of the past decade all but refuse to acknowledge the existence of Canadian values up until now? Seemingly, it’s because they thought it in contradiction with their “diversity is our strength” message. But it didn’t have to be. Canada can be both a welcoming nation to immigrants while asserting core values, including not rushing to the streets to celebrate, for example, the horrific acts of October 7 in cities across Canada or accosting Jews in their Toronto neighbourhoods. These values should be easy to point to. But we cannot expect them from Carney’s Liberals no more than we could Trudeau’s. So, which values did Mark Carney decide Canadians have? According to him, three: humility, ambition, and unity. He told the crowd during his victory speech, he’d do his best to “uphold them every day” as our prime minister, ending with a “You betcha” — a folksy phrase popularized by the film Fargo, which takes places in Minnesota, not Canada. This was an awkward choice, given the juxtaposition between Carney’s status as a former governor of two central banks and global emissions targeting investment banker. It was so clearly an affectation that matched neither his middle-class Canadian upbringing, nor his likely hefty undisclosed assets. It’s as if he keeps trying new versions, caricatures of what he thinks Canada represents, from elbows-up to Mr. Dressup, to rural expressions, hoping one will fit. But they all hang off him like a poorly-hemmed suit. Why these values? Carney said that Canada was in a crisis, but reassured his audience that “Canadians are ambitious. And now, more than ever, it is a time for ambition. It is a time to be bold to meet this crisis with the overwhelming positive force of a united Canada, because we are going to build. Build, baby, build.”  And there seems to be no shortage to what he thinks his Liberal government should be building including “hundreds and thousands of not just good jobs, but good careers in the skilled trades,” “an industrial strategy that makes Canada more competitive while fighting climate change,” “new trade and energy corridors,” and, again, making the promise to “build Canada into an energy superpower in both clean and conventional energy.” But we know he’s refused to repeal Bill C-69, the Impact Assessment Act, and he can’t even bring himself to say the word “oil.” When he did during one of the Liberal leadership debates, he struggled to even get the word out. As if saying it made our clean energy saviour feel dirty.   And where does the necessity of Canadian humility come into play? He continued, “I want to be clear. The coming days and months will be challenging and they will call for some sacrifices. But we will share those sacrifices by supporting our workers and our businesses.” He followed up with, “We do things because they’re right, not because they’re easy,” again, congratulating his supporters on their kindness. But it’s not clear what sacrifices he was referring to. More national debt and a larger deficit? More counter measures against the U.S., which will hurt Canadians and possibly cost more jobs? More pain from carbon taxes, perhaps this time buried? It’s not clear even Carney knows what he meant.  In addition to the lack of clarity on these “sacrifices,” the suggestion doesn’t fit the moment. We’re not in war times, so the language of rationing is odd. And we’re not currently in a crisis, as U.S. President Donald Trump’s tariffs keep getting softened, and even Carney says he plans to negotiate a new deal with him. One thing’s for sure, though I doubt Carney truly got the message, Canadians do not need to make any more sacrifices for Liberal policies like the consumer carbon tax, which they recently reduced to zero — not because of the burden it placed on Canadians — but because it was too divisive and unpopular for them.   Yet, Carney continued to use the word “fight”...  To suggest that Canada’s relationship with the United States, as it has existed until now, is over for good, based on the chaotic choices of one American President who will be gone in four years does not seem wise or practical. But enough Canadians seem to agree with the prime minister, because what Carney said during this speech is what he’s been saying all along. Carney’s success hinged on an actual, foolish, and unhumble Canadian value — our deep-seated belief that we are somehow better than Americans, partially due to their ambitious natures. He sold us our own fiction, and it worked.  It now looks like Canadians’ concerns and values about women’s sex-based rights, the fool-headed administration of hormone blockers to children, the infiltration of toxic DEI into schools and workplaces rather than merit-based decisions, and anti-Israeli sentiment on campuses, streets, and neighbourhoods, among other things, will have to wait. As will concerns about Ottawa’s attacks on the resource industry, and issues of national unity. Carney has other ambitions." Canadians don't see a unified economic way forward and that's bad news - "Canadians are obviously very divided. A simple look at the vote count reveals that roughly 43.5 per cent voted for a Liberal candidate, whereas 41.5 per cent voted Conservative. The Liberals’ playbook to stoke fear was obvious and proved to be a political winner: calling the chaos caused by Donald Trump a national crisis or the “biggest crisis of our lifetime” to get people motivated to vote for the so-called saviour. There are a lot of historical examples around this simple playbook. Unfortunately, it continues to be a winner with shallow policies that surround that simplicity... regardless of the trade war, our country’s recent economic performance by virtually any measure has been stagnant. Should Carney carry out his plan that was presented during the campaign, it will lead to significant new government intervention and massive inflationary spending with little positive impact. And with the continued attacks on our precious and important energy industry, such a vital industry will not be able to contribute more to energy stability and important economic upticks. This is not a recipe for recovery; it’s a continuing eviction notice for Canada’s wealth creators. Expect more entrepreneurs and capital to flee. Third, our country can expect shallow taxation policies to continue as the norm. Our income tax statute is filled with political tax gimmicks that need to disappear. A great example is the recently added prohibition of expense deductions if you happen to be an owner/operator of a short-term rental property in a jurisdiction where the municipality prohibits such operation. This prohibition is nonsensical and dangerous, especially when you understand that drug dealers who wish to be tax compliant (which, of course, the vast majority are not) are able to deduct their expenses to earn such illegal income. This puts short-term rental owners in a worse-off position than criminals from a tax and public policy perspective. From a personal perspective, the Liberal win hurts. Canada needs significant tax reform and big-bang ideas to get our country back on track. The Conservatives had promised to convene a tax reform task force within 60 days of getting elected so as to carry out that necessary exercise. Unfortunately, the Liberals have historically shown zero interest in positive tax reform, other than carrying on with their political tax objectives. The election campaign provided further evidence of that since none of their tax policy promises displayed any big ideas. Most of their tax promises were copied from the Conservatives (personal tax cut for the bottom income bracket, elimination of the GST on new homes, elimination of the capital gains proposals and removal of the consumer carbon tax), with zero new big ideas other than one very silly idea to resurrect a 1970s-style tax shelter in an attempt to encourage housing construction. Good grief. Tax reform will remain a fantasy until the Liberals discover a poll that its voter base suddenly cares about fiscal sanity and sound taxation policies. Wait, I just saw a unicorn cross the street. Overall, Canada has significant work to do to unite. Is this Liberal government the one to do that? No. By stoking fears without plans for economic sanity and tax reform, it is likely that the day for Canadians to unite is a ways off. The Liberal Party win is an example of incoherence bound together by temporary issues, and the lack of a plan to get our country firing on all cylinders will be greatly exposed when those temporary issues disappear or diminish."