The Canadian Liberal leader’s fortunes turned around when all signs had previously pointed to defeat. But will they turn back?
The Canadian Liberal leader’s fortunes turned around when all signs had previously pointed to defeat. But will they turn back?
A s often happens when I’m struggling to understand some political mystery, no amount of pondering at the computer comes to my aid. Instead, the answer suddenly hits me when I’m least able to think it through seriously. Sometimes that’s when I’m singing in the bath, or when the phone rings as I’m cooking scrambled eggs, and on this occasion it was when I was giving an unscripted talk to the Margaret Thatcher Conference on the future of conservatism, held recently in London by the Centre for Policy Studies.
A distinguished Canadian conservative on the panel had reluctantly conceded that Mark Carney, in living memory the former governor of the banks of both Canada and England — surely a loud enough alarm bell to Canadian voters, one might have thought — looked as if he would snatch away an electoral victory that had been hand-delivered to Tory leader Pierre Poilievre by Liberal Prime Minister Justin Trudeau after almost a decade of folly, failure, and misrule.
Bear in mind that Canadian liberalism is the default position of the electorate of most of Canada: from the struggling maritime provinces reliant on subsidies from Ottawa, around French-speaking Quebec adept at extorting concessions from Ottawa to stay Canadian, through immigration- and minorities-rich, strong-shouldered Ontario, which provides but also consumes most of those subsidies, all the way to the playfully relaxed, social-experiment-minded British Columbia, with its influential labor unions and its Californian politics.
Only the prairie provinces — especially energy-rich, steak-proud, don’t-tread-on-me Alberta — lean Conservative on a reliable basis, in large part because their energy pays for a lot of Ottawa’s largesse. In the age of net zero and carbon taxes, however, they get no credit for their oversized contributions to the federal budget. Indeed, Alberta is more likely to get abuse from Canada’s woke elites for earning the wealth shamefully. Like the harlot’s parents in the old song, they “drink the champagne that she sends them, but they never speak her name.”
So the Liberals (a.k.a. “the Grits”) start out with an advantage in most election campaigns, except when they have squandered a period in office so massively that even centrists and moderate Liberals turn against them and vote Tory. A few months ago, that seemed to be happening. After ten years in office, Prime Minister Trudeau was careening out on a toboggan of poor economic statistics, political scandals, a divided cabinet, and an overall blend of high-handed authoritarianism amplified by incompetence.
A study, by the Vancouver-based Fraser Institute, of economic growth under the last five prime ministers — i.e., per person, inflation-adjusted, annual economic growth, which is probably the single best measure answering Reagan’s question, “Are you better off than X years ago?” — showed that Trudeau’s average of 0.3 percent was the lowest.
Embarrassingly, Trudeau had entered office in 2015 promising to revive economic growth by a looser fiscal and financial policy founded on higher government spending. Since he didn’t get the growth, higher government revenues weren’t there to finance his vastly higher spending. As a result, Trudeau literally doubled Canada’s national debt. According to another study by Fraser, “compared to the last full year under Prime Minister Harper, federal debt per person had increased by $14,127” in this final year.
Admittedly, economic statistics are usually hotly contested in election campaigns. This time, not so much. For the election today was initally set in train when Trudeau’s finance minister resigned, stabbing him firmly in the front with a letter refusing to present a budget that hiked spending and debt, which were already far too high. That made the government’s economic record indefensible in a literal sense. It was the end for Trudeau — and his economic record remains a millstone around the Liberal Party’s neck — but it took a little time, plus some shady maneuvers, to get the entire Liberal Party out of the ditch.
It was a deeper than usual ditch, too, because the Conservative Party of Canada was being led very capably by a former minister from the government of Stephen Harper, who combined high political experience with sure political instincts, a confident handling of the media, and a tough-minded, realistic conservatism that didn’t frighten the horses. Unlike Trudeau, he seemed a serious and competent figure. One month ago, Poilievre was ahead in the opinion polls by double digits and getting large and friendly crowds at public meetings. He wasn’t making mistakes, either, and that steadiness has continued to this weekend.
Then two political events happened more or less simultaneously — a major one and a minor one. The minor one was the election of Carney to the leadership of the Liberal Party and therefore the prime ministership of Canada with little opposition, since he was seen as (a) the party’s only likely savior and, (b) even so, unlikely to win today’s election. His many previous high-ranking international and financial positions — e.g., U.N. special envoy for climate action and finance; special adviser to the British prime minister (then Boris Johnson) on climate change — had not reqired democratic skills, but they had wielded real political power. And in both banking and politics, he has been remarkably consistent — not necessarily and always a virtue.
Carney’s particular concern has been to seek to persuade, “nudge,” even compel banks, corporations, and other economic actors to integrate the risks of climate change into our understanding of fiduciary duty. Rather than invest their clients’ money to get the best return, they should prioritize avoiding fossil fuel investments. What makes Carney’s argument more sophisticated than this crude summary is that he disguises an essentially ethical argument as long-term prudent investment advice (with warnings that managers who ignore him may face shareholder suits for losing money).
But how ethical is this argument, anyway? As I have argued in The Pipeline, the Victorians, who invented the joint-stock corporation, saw its weaknesses very clearly. Half of their popular melodramas depict a villainous guardian who seeks to marry a wealthy ward whose fortune he has embezzled in order to benefit from the rule that a wife cannot give evidence against her husband. Victorian audiences would hardly have been soothed if, after his exposure, the villain had stepped forward to explain that he had merely redistributed her fortune on charitable grounds that left her comfortably off and lifted scores of the poor out of dire poverty. We can’t justify spending other people’s money on our favored causes because we think the causes are virtuous.
Carney might object that, in expanding the notion of fiduciary duty, he’s not favoring a cause but giving prudent advice that will save investors from foreseeable losses. For that to be true, however, he would need to have some ability to see the future better than the market.
Does he have that faculty? He has been seriously mistaken twice in his forecasts of how the U.K. economy would perform following Brexit. The first occasion was when he predicted, prior to the 2016 referendum, that the economy would be badly damaged merely by a No vote. In fact, following the vote, the economy improved and performed better than its EU neighbors. The second occasion was in 2018, when the Bank of England issued predictions on how Brexit itself might damage the U.K. economy. Those forecasts were criticized and later adjusted heavily to make them less Brexit-phobic.
What, then, of the general skepticism that Carney expresses about the long-term financial viability of fossil fuel companies? In 2023, fossil fuels still accounted for 82 percent of energy usage worldwide. Their market prospects seem fair — threatened mainly by governments, U.N. energy policies, and investment vehicles like Carney’s Net-Zero Banking Alliance and his Glasgow Financial Alliance for Net Zero. But neither bankers nor regulators can justify downgrading fossil fuel investments on the grounds that their own regulations will damage their return on capital — that’s a circular logic. That seemed to be happening, however, earlier this year, until six major U.S. banks and five Canadian ones withdrew from these funds at almost the same time that Carney was announcing his prime-ministerial bid. And net zero as a policy is weakening worldwide.
None of this will have any effect on Carney’s commitment to net zero if he is elected today. He is net zero — if he were to forswear it, he would evaporate as a public figure. But net zero would have a catastrophic effect on Canada, which is an energy superpower and shaped by that reality. Without reliable and cheap fossil fuel energy, its mining, steel, manufacturing, cement, agriculture, forestry, plastics, petrochemicals, autos, transportation, and aviation industries would seize up. They and the country would be crippled by the energy loss that net zero imposes.
In any normal election, that fact would have ensured Poilievre’s victory. That was why Kings 12-14 suddenly invaded my mind, questioning the assertion that Carney was likely to win, given that his main policy plank is modeled on a famous Old Testament political appeal:
And the king answered the people harshly, and forsaking the counsel that the old men had given him, he spoke to them according to the counsel of the young men, saying, “My father made your yoke heavy, but I will add to your yoke. My father disciplined you with whips, but I will discipline you with scorpions.”
Not a usual election-winning program. Poilievre could make rhetorical hay with variations on Trudeau, whips versus Carney, and scorpions. But today’s is not a usual election because Canadians have been suffering from Trump Derangement Syndrome since the U.S. president dropped hints about annexing Canada (which the U.S. Congress would never allow him to pursue). This intervention — the major development, referenced above — has spooked them. They see a dastardly Trump in every conservative, including the prudent and patriotic Poilievre, and equally misguidedly they see a rock-ribbed flag-waving jingo nationalist in both the globe-trotting cosmopolitan banker Carney and in his Liberal Party, which in the last decade has specifically taken pride in not having any national identity at all on the grounds that it would be racist.
Nothing seems to shift this entrenched delusion. Trump says he would prefer Carney to win. Canadians smile darkly at this transparent trick. Everyone strikes defiant postures of Resistance to an imaginary threat. On and on it goes. As we know from American politics, TDS is a mania capable of driving otherwise stolid men and women, such as judges, to extremes of destructive rage in which they happily harm themselves to no useful effect. Therefore, Canadians today might go to the polls to elect a man who, in net zero, is promoting the only policy that could possibly reduce Canada to the kind of helpless and hopeless invalid country that might see 51st statehood as some deserved punishment for a moment of folly regretted as soon as committed. Unless the mania lifts, and they examine the political choices before them with the cool temperate moderation we expect from Canadians.
Let them read on to Kings 16: “King Rehoboam sent Adoram, who was taskmaster over the forced labor, and all Israel stoned him to death with stones. And King Rehoboam hurried to mount his chariot to flee to Jerusalem. So Israel has been in rebellion against the house of David to this day.”
Canadians see King Rehoboam as Trump. He sounds to me much more like Carney, or just possibly Adoram. I wouldn’t take chances with either. Vote Poilievre.