To the Point: For the Week of January 26th, 2025
To the Point for the Week of January 26,
The Ontario election is in full swing, but is it really a lock for Doug Ford and the PCs? A Ruby red outsider makes waves, Freeland freefall, and Carney’s coronation round out our update on the Liberal leadership race. The federal government will get what they wanted all along.
PROVINCIAL
The last time Ontarians went to the polls in a Winter general election was in 1883, and just like in 1883, voters will cast their ballots on February 27th. Each major party launched their campaigns and attempted to frame the election with their own narratives. The Premier used the backdrop of the US/Canada Ambassador Bridge in Windsor to initiate the PC campaign. Ford has been emphasizing for weeks that this election is squarely about protecting Ontario from President Trump’s 25% tariff threat and the need for a strong mandate to initiate a “pandemic-like” response that would include billions of dollars in supports for individuals and businesses. A day later, the Premier was in London speaking with autoworkers where he committed to spending billions in supports of workers, skills training, and job transitioning, including an infusion of an additional $1B into the Skills Development Fund. And Friday, the Premier made several stops in Niagara with the polls showing that the PCs could pick up some orange seats.
Ontario Liberal Leader Bonnie Crombie launched her campaign in Barrie with Barrie-Springwater-Oro Mendonte candidate, and former Ontario Medical Association President, Rose Zacharias, to frame the election about leadership. Crombie continued her attacks on the Premier, calling his decision to call an election costly and selfish. Dawning a hat that read “Real Leaders Fix Healthcare,” she went after the Premier’s leadership for failing to end hallway healthcare, a promise the PCs made during the 2018 election. Crombie’s first policy pitch to voters was a promise to ensure each Ontarian has a family doctor within four years. On Thursday, the Liberal leader opened her Mississauga East-Cooksville campaign office and later knocked on doors with volunteers
Marit Stiles launched the Ontario NDP’s campaign in downtown Toronto to throngs of supporters. Stiles’ pitch to voters is its time to “turn the page” on Premier Ford and the PCs, going on to say that “Doug Ford quit his job as Premier, so I’m here to apply.” The NDP leader focused her campaign launch on the issue of affordability and insinuated the Premier called an election to get ahead of bad legal news emanating from the Greenbelt ruckus as well as the deal the Premier inked for Ontario Place. In line with her focus on affordability, Stiles says the NDP will eliminate tolls on highway 407 in the first 100 days of becoming Premier.
Premier Ford and the Ontario PC campaign is dialed in. The Premier has kept up a very busy schedule making policy announcements and meeting with critical business and labour stakeholders. His campaign promises this week almost exclusively aligned with his message of protecting the economy and workers from Trump’s expected tariffs. The Premier also looked to cover his vulnerable flanks by first announcing the province has contracted an engineering firm to begin the design work for removing bike lanes in downtown Toronto and announced an additional $1.8B over four years to connect 2 million Ontarians to a primary care physician. The main takeaway: Ford and the PCs are running on all cylinders at the expense of the Ontario Liberals.
Crombie’s first week could be perceived by Liberal diehards as uninspiring and demotivating. The Liberal leader continues to harp about the election being called and is very thin on policy. Her campaign launch did not feature a single supporter. It was just Crombie and Zacharias standing in front of a medical office building. Juxtapose her campaign launch with the NDP launch that had energy and enthusiastic supporters, a standard campaign backdrop. Regardless of who had the better start out of the gate, the fact of the matter is the Liberals and NDP must not get caught up trying to change what this election is about: President Trump’s tariffs. Yes, healthcare is a serious issue. And yes, the PC government has not lived up to its commitment to build 1.5M homes by 2031. Surely both the NDP and Liberals understand this election is being overshadowed by the White House and the looming and broad implications. The Liberals and NDP would be wise to present a plausible and viable alternative to Premier Ford’s commitment to spend billions.
The Premier should be cautious and not allow himself to snatch defeat from the jaws of victory. The Premier currently controls the narrative of the election but should not bank on having that luxury throughout the campaign. Anything, and we mean ANYTHING, can happen between now and election day that could jeopardize what is shaping up to be an enormous PC majority victory.
FEDERAL
Liberal Leadership Race Update
The Ruby Revolution
Ruby Dhalla is shaping up to be a disruptor in the Liberal Party’s leadership race. She truly is the outsider candidate. Her campaign has garnered a lot of attention for her strong social media game, producing short videos that are entertaining, featuring policy positions that starkly contrast with her fellow candidates. Ruby has framed herself as a savvy businessperson who understands President Trump’s business mindset and insists she will strike a deal with the administration to avoid tariffs. Dhalla has also boldly proclaimed her intent to deport all illegal immigrants living in Canada. Ruby has taken direct aim at Mark Carney, borrowing some messaging from the Conservatives labelling the former Bank of Canada chief as Trudeau 2.0.
While it is unlikely that Dhalla will become the next leader of the Liberal Party of Canada, she has been interesting to watch. She’s 10 years out of the game, though, and carries her own political baggage. Her vision for bringing the Liberal Party close to the centre of the political spectrum will not be appealing to progressives who firmly control the party. In fact, do not be surprised if Ruby gets the Chandra Arya treatment and gets tossed from the race without explanation. Our hope is Dhalla makes it to the debate. Since she has literally nothing to lose, she risks embarrassing the other candidates over their records and unsevered ties with the Trudeau government. The prospect of Ruby Dhalla tossing political hand grenades to Freeland, Carney and Gould is very entertaining.
Freeland’s Freefall and Carney’s Coronation
Once thought of as being the post-Trudeau future of the Liberal Party of Canada, the perception around Chrystia Freeland is that her leadership campaign is floundering, desperately trying catch up to Mark Carney. Carney has 63 endorsements, including most of cabinet, and more than double that of Freeland’s 26. Freeland has also criticized Carney for being part of the “establishment” of the Liberal party, which is comical considering she has openly bragged about being close to Trudeau for the last ten years. More bad news for the campaign this week came in the form of a Leger poll that found of all Canadian voters, 34% thought Mark Carney should replace Justin Trudeau, compared to Freeland’s 14%. It does not get much better for her when the same question was asked of strictly Liberal voters, 17% believe Chrystia Freeland should replace the Prime Minister compared to a whopping 57% for Mark Carney.
She’s also put forward weak policy measures that include backtracks and flip flops, such as the capital gains and carbon taxes, which are not even listed on her website. At the moment, Freeland only has four policy positions listed on her website: a Party Renewal Plan that includes giving power to caucus to remove the Leader; a promise to reduce the size of cabinet and the Prime Minister’s Office by 50% (a policy that goes against the entire Liberal brand of big government); a plan to take on foreign interference (policies that she’s more than welcome to push for while still a member of the Liberal caucus); and, most prominently, a plan to stand up to President Trump. There is no mention about housing, the cost of living, crime and public safety, immigration, or how to create jobs and grow the economy. She has even gone as far as suggesting the Canadian government impose a 100% tariff on Tesla cars. An insane policy position for someone who has been harping on climate change for decades.
It was reported before the start of the leadership campaign that Katie Telford, Trudeau’s Chief of Staff, Gerald Butts, the Prime Minister’s former Principal Secretary and close friend, and the Prime Minister himself were burning up the phone lines calling their political allies to rally support around Mark Carney. Even the legacy news media has rallied around Mark Carney. They are manufacturing hype around his campaign by asking soft ball questions, and seemingly only when Carney feels like taking any at all. CBC’s Rosemary Barton even went as far as to suggest Chrystia Freeland had no evidence to suggest Mark Carney is the Liberal establishment’s preferred candidate.
Perhaps Freeland overplayed her hand or miscalculated her level of support amongst caucus and Liberal diehards by resigning in such a spectacular fashion. She has failed to generate any buzz around her campaign, even manufactured buzz with support from friendly media. She does not have any big ideas to attract the support they have lost. Perhaps Freeland is biding her time until the planned February 27th leadership debate to take her son’s Godfather down a peg or two.
Trump Delivers Exactly What the Liberals Wanted
The Trump administration confirmed what everyone expected: the United States will impose a 25% tariff on Canadian goods coming to the United States. On Friday, rumours were abound that the President would defer the tariffs to March 1st and would be targeted to specific industries like steel and aluminum. Oil and gas would be exempt. The administration quickly shut down those rumours as false. Later that evening, Trump was asked by reporters if there was anything the Canadian government could do to convince him to reverse course. His answer: No.
One would think the government would have spent virtually all its time between the dinner at Mar-a-lago and February 1st working diplomatically with the intention and purpose to strike a deal with the Trump administration. But that’s not what happened at all. In fact, the Trudeau government (yes, he’s still the Prime Minister) spent some of the time assembling a haphazard border plan in response to the President’s concerns about illegal immigration and fentanyl making their way into the United States. The rest of the time was spent performing political theatre in the form of escalating, and at times flat out insulting, rhetoric, presumably to stoke the hatred of the American president among the Canadian public. The Prime Minister convened several meetings with the Council of the Federation that in hindsight was an obvious attempt to isolate Alberta Premier Danielle Smith and do what he intended to do at the start of his tenure as Prime Minister: shut down Alberta’s oil and gas industry. He stoked deep divisions and resentment between regions of the county, openly proclaimed the government’s intent to make Americans feel economic pain and downplayed the President’s concerns regarding the border.
Why is that? Why would the federal government appear to be so unwilling to enter good faith discussions with the new administration that is going to be loudly around for the next four years? Is it because it is exactly what the Liberals want and need politically? They want a COVID-like emergency that would justify the spending programs of billions of dollars in what will eventually become permanent. But where would they get the money? A 25% tariff on US goods is estimated to generate 4-5x in additional revenue for the government amounting to $50-$70B a year. How will the government make up for a short fall in revenue to implement COVID-era spending? The answer: the federal government has been quietly lobbying the Bank of Canada to provide more liquidity. In other words, they want the BOC to print money again.
The Liberals are banking on the good graces they received from Canadians during the pandemic and are hoping for lightning to strike twice with a tariff war. A second spending spree – over an issue that could be avoided – is simply politically and economically reckless. Just as Canada appears to be slowly drifting out of an inflationary period (1.8% last month), the Liberals intend to make this round of insane spending bigger and longer, which will have a compounding negative impact on the economy far greater than following COVID. At least when Trump tried the same tariff tactics during his first term, inflation in the US remained steady at around 2% for that period. Why? Because the upward pressures on prices from tariffs were counteracted by downward pressures on prices, such as cutting regulations, cutting spending, and producing cheap, reliable energy. By contrast, the Biden administration spent $6-$7 TRILLION over-stimulating the economy that resulted in runaway inflation. The Liberals simply do not have it in their DNA to take these types of measures. They had 10 years to do it.
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