By Sheila Copps
First published in The Hill Times on July 31, 2023.

OTTAWA—Justin Trudeau has rolled the dice.

Last week’s massive cabinet shuffle makes one thing certain: the prime minister plans to lead the Liberal Party into the next election.

The ballot question he is aiming for is the economy, and Trudeau is banking on enough political runway to convince Canadians that the best masters of the economy are already in the job.

The shuffle is a not-so-tacit admission that Conservative Leader Pierre Poilievre is hitting the mark when he travels the country on his so-called “Axe the Tax” tour.

It matters little that the majority of Canadians are actually getting money back because of the way the carbon tax remittance has been structured. Canadians are reeling from rising prices and the hike in national interest rates. Global issues may be responsible for the cash crunch, as Trudeau mentioned during his press conference lauding the new cabinet team. But all politics is local.

Polls show that local politics right now is hitting the Liberals hard. On the same day as Trudeau announced the massive change in cabinet, Abacus Data released a poll showing the Conservatives were 10 points ahead of the Liberals. Pollara put out a poll earlier in the month claiming the Tories were 12 points ahead among Indigenous voters.

Trendlines are clear. Tories are climbing and the Liberals are lagging. The shuffle is supposed to staunch the political bloodletting.

Highlights included the appointment of Arif Virani, Canada’s first Muslim attorney general and Rechi Valdez the first Filipina woman in a Canadian cabinet. Original reports cited the appointment of a first Filipino, but that was amended, as the first Filipino member of cabinet was Rey Pagtakhan in the cabinet of Jean Chrétien.

The demographic changes to cabinet are pretty clear evidence that the shuffle is intended to launch an election team. As well as specific nominations in the Muslim and Filipino community, the prime minister also named a Tamil Canadian as minister responsible for Crown-Indigenous relations.

Gary Anandasangaree will have big shoes to fill because outgoing minister Marc Miller developed an excellent relationship with Indigenous communities, as both portfolios he has held in the past eight years involved work with those communities. Indigenous Services Minister Patty Hajdu has regional experience with Indigenous peoples because of her home riding in Thunder Bay-Superior North, Ont.

Anandasangaree is a risky choice because his urban Scarborough background is not exactly a hotbed of Indigenous politics. However, he has a reputation as being accessible and active, and worked on an Indigenous consultation process for the Rouge National Urban Park.

He wouldn’t be the first minister to build a relationship with Indigenous peoples from scratch. But the popularity of Miller and Hajdu were undeniable, and, given the government’s commitment to reconciliation, the decision to make a change is potentially tricky.

The Trudeau inner circle of cabinet makers must be banking on the fact that these new appointments will buttress the party in areas of the country where they will be in pitched battles with the Conservatives. Suburban GTA ridings are always a dogfight, so the appointments of Anandasangaree and Valdez could have an impact on potentially tight races.

Trudeau is also trying to change the “change” message. With three terms under his belt, the prime minister is well known to the public and somewhat shopworn.

As my mother taught me, politics is the only job where the more experience you get, the more people want to get rid of you, and in three terms, you make enemies who want you out.

The change narrative is the movement when governments are voted out. It doesn’t matter what kind of a job they have done; their political time is up. In most instances, people vote governments out, they do not vote opposition parties in.

A new government is given the benefit of the doubt. The thinking is, with this sizeable change in positions, there is an element of newness surrounding the team. While that is true, there is no element of newness in the leader.

Trudeau is obviously banking on the fact the surly side of the Conservative leader will convince enough voters that Poilievre is not the right person to lead the country. While Trudeau may no longer be loved by all, his opponent has never been loved by many.

If the ballot question is the economy, the prime minister stands a fighting chance of re-election. If the question remains a need for change, his bold cabinet move won’t mean much at the ballot box.

This past week, the next election got started.

Sheila Copps is a former Jean Chrétien-era cabinet minister and a former deputy prime minister. Follow her on Twitter at @Sheila_Copps.

By Sheila Copps
First published in The Hill Times on July 17, 2023.

OTTAWA—According to Albert Einstein, the definition of insanity is doing the same thing over and over again and expecting different results.

Someone should tell that to Bank of Canada Governor Tiff Macklem. The bank has hiked interest rates 10 times since March of last year.

Instead of cooling the economy, the action simply hits workers harder. The Canadian economy continues to expand, with 60,000 new jobs added last month. Companies continue to face a worker shortage, forcing employers to increase their wage offerings in the hunt for employees. That is not a bad thing.

But hiking interest rates increases costs and depresses wages. Macklem insists his monetary policy is working, but he cannot say whether or not last week’s rate rise will work, calling for patience to see whether the actions succeed in reining in inflation.

Patience may be fine for those managing the money markets, but what about ordinary citizens on the verge of losing their homes because of the hike in interest rates?

The moves are fodder for New Democratic Party Leader Jagmeet Singh, who says these interest rate hikes are simply making things worse for workers and businesses. Singh is calling the current situation “greedflation,” and he blames the problem on greedy CEOs who are using the inflationary crisis to make more profit and gouge consumers. He says the government has to take another approach to tackle the current inflationary spiral.

Singh says supply chain issues, the war in Ukraine, and the cost of housing and groceries are responsible. None of these factors will be affected by interest rate increases. Only the pocketbooks of ordinary Canadians are touched.

Singh’s criticisms enjoin the year-long campaign of Conservative Leader Pierre Poilievre, who started calling for the firing of the Bank of Canada governor during his run for the party leadership. However, Poilievre’s financial acumen took a hit when he also suggested that Canadians should invest in cryptocurrency because it allows them to escape the inflation being created by the central bank.

Leadership opponent Jean Charest attacked Poilievre’s firing promise, and then Conservative finance critic Ed Fast stepped down from his post, claiming, “I’m deeply troubled by suggestions by one of our leadership candidates that the candidate would be prepared to interfere already at this stage in the independence of our central bank.”

That statement was made more than a year ago, but the continual climb in interest rates has started to create political pressure from both the right and the left. Singh is not calling for Macklem’s resignation, but he is asking for a change in the bank’s conventional approach to fighting inflation.

With complaints from both sides, the government is going to face some real pressure to pivot financially. Liberals can’t afford to fight inflation and an election. However, the fact that the Federal Reserve in the United States is expected to raise rates slightly at the end of the month could blunt criticism of the Canadian situation.

At the end of the day, ordinary Canadians are feeling the pinch at the grocery store and in the housing market. The cost of rental accommodation is skyrocketing across the country, and the path to home ownership for many is blocked by the high cost of mortgages.

Macklem is not the only central bank governor using interest rates as a blunt instrument, and if there is another route, it must be determined by the government, not the bank governor.

With grocery profits in the eye of the storm while prices seem to increase weekly, more needs to be done in that area. The recent price-fixing decision of the Competition Bureau, issuing a $50-million fine against Canada Bread, was a good first step.

But that money should go back to those Canadians who paid excessive prices for years.

Likewise, the bureau can do more, including speeding up the length and breadth of its investigations into price-gouging. The bread investigation took seven years and involved immunity to Loblaw Companies for revealing its part in the scheme. On average, the Competition Bureau found that Canadians paid $1.50 extra for bread products for the past eight years because of the collusion.

There are undoubtedly other food groups and other consumer items that face a similar lack of competition because of price-fixing. A move to strengthen the budget and investigative strength of the Competition Bureau would be a good place to start.

Firing the bank governor is not the answer. But doing something to stop price gouging would be a good start.

Sheila Copps is a former Jean Chrétien-era cabinet minister and a former deputy prime minister. Follow her on Twitter at @Sheila_Copps.