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An inside look at Canadian politics and power in Ottawa. | | | | | |  | | By Shawn McCarthy | Welcome to Corridors. Over the next few issues, we’ll introduce you to contributors as obsessed as we are with policy and Canadian politics. Our goal is to add context and perspective to a moment without precedent on Parliament Hill — including Budget 2021. This week’s guest writer is Shawn McCarthy. A former national business correspondent for the Globe and Mail, Shawn most recently covered the global energy beat. He’s worked in Ottawa and New York for the Globe and served as its parliamentary bureau chief. He is now an independent writer and editor, and a senior counsel at Sussex Strategy Group. Like most of us, he aspires to hug family and travel once again. Over to you, Shawn. — Sue Allan, editor of POLITICO Canada. | | | A nice perk for me covering Paul Martin in the mid-1990s was following him on his annual post-budget pilgrimage to New York City where he sought to reassure the bondholding financiers about Canada’s creditworthiness. The high-profile finance minister would deliver an austerity message in some fancy Manhattan hotel ballroom and after filing our articles, my reporter colleagues and I would be free to enjoy the nightlife of the Big Apple. In 1995, Martin unveiled his famous deficit-busting budget and then scampered down to Wall Street to persuade bondholders and other investors that the Liberal government would close Canada’s yawning budget shortfall “come hell or high water.” Deficits mattered then. Debt payments ate up nearly 40 cents on every dollar of federal revenue, and large annual deficits combined with high interest rates threatened to swamp Ottawa’s spending capacity. Deficits still do matter. However, there are deficits other than fiscal ones — gaping social and environmental needs — that demand government action and spending. As Finance Minister Chrystia Freeland prepares to deliver her first budget — and the Liberal government’s first in two years — she has to contend with not only the government’s deepening fiscal hole, but an environmental crisis and deep social inequities that can only be addressed through government action. She will also have to maintain the safety net that has protected Canadians through the Covid crisis. Success will be measured by how well she addresses those broader societal needs while maintaining some sort of fiscal discipline. I spent my mid-career covering government finances when issues of inter-generational fairness over rapidly growing government debt and pension plan liabilities were front-page news. I closed out my career covering energy and climate change where a legacy of unchecked greenhouse gas emissions threatens the future of my children and grandchildren. Now, I write from semi-retirement in the middle of the third wave. And I note the ways the Covid-19 pandemic has exacerbated the existing inequities faced by women and racialized people, even as it provides a stark warning that we must heed science and take collective action to address longer-term threats. Sure, Freeland needs to be careful not to mire the federal government in debt that might seem affordable now but could explode if — more likely, when — interest rates rise from bargain-basement levels. But there is also far more pressure on her and Prime Minister Justin Trudeau to address those social and environmental deficits than there ever was on Paul Martin a generation ago. The notion that fiscal rectitude, a strong economy and liberalized markets would lift all boats has proven false. The growth in market incomes has skewed dramatically to the already-affluent. And the pandemic has amply demonstrated that women’s progress in the workforce remains heavily dependent on safe and affordable childcare. It’s no surprise then that Freeland signalled at the Liberal onvention last weekend that a national childcare program will figure prominently in the government’s budget. At the same time, climate change is now widely recognized as a looming crisis. Liberals have promised to create a million jobs with “climate action” at the centre of that effort. While climate change will no doubt be a major theme in the 2021 Budget, environmental advocates will likely be disappointed in Freeland’s willingness to spend on programs aimed at reducing greenhouse gas emissions. That’s particularly so when they compare it to U.S. President Joe Biden’s $2-trillion climate plan. Biden’s climate plan focuses almost exclusively on spending and tax incentives. The Liberals are ramping up climate-related spending, but their strategy relies more heavily on regulatory measures and a sharply rising carbon price, an approach that is unlikely to win support in Washington. The famous line that “deficits don’t matter” was attributed to former U.S. Vice President Dick Cheney although the political context is often forgotten. Cheney was referring to the electoral landscape as President George W. Bush prepared for his re-election campaign in 2004. Bush had slashed taxes while ramping up defense spending on the wars in Iraq and Afghanistan. The deficit, Cheney figured, was an acceptable cost in the face of other political priorities. Facing possible election this year, Trudeau and Freeland will make the same calculation, albeit with much different priorities. Over to the Corridors crew, Sue Allan and Andy Blatchford. | | | | 
Taiwan's President Tsai Ing-wen delivers a speech during the annual dinner of the American Chamber of Commerce in Taipei, Taiwan on April 10, 2019. | Chiang Ying-ying/AP Photo | Who’s up: Tsai Ing-wen, president of Taiwan In the spotlight, even though the Halifax Forum has yet to award the John McCain Prize for Leadership in Public Service. Read the latest on the story from POLITICO’s Betsy Woodruff Swan and Andy Blatchford. Who’s down: Sandy Silver The Yukon premier’s Liberal majority government was reduced to something not quite yet clear on Monday night. Still TBD are the results in the riding of Vuntut Gwitchi where the two candidates in the race each received 78 votes. Should a judicial recount confirm the tie, Yukon’s election laws apparently call for a drawing of lots. Eric Grenier explains why the results — once they are known — should be a concern to Trudeau’s Liberals. | | | Corridors is a new weekly newsletter for MPs, lobbyists, executives, activists and any readers who are interested in what’s going on around Parliament Hill. Every Wednesday we will look at the people pulling the levers of power in Ottawa and the questions that are influencing decisions on Parliament Hill and in the provinces. Join the conversation! You can email us at ablatchford@politico.com, lgardner@politico.com and sallan@politico.com. | | | Canada vs. Covid, Round 3: Case counts were up 33 percent last week. “We are seeing daily cases still rising along a strong resurgence trajectory,” Canada’s top doctor Dr. Theresa Tam warned Canadians on Tuesday. Like most things these days, that brings us to vaccines. Asked during the same briefing if he wishes Canada had done anything differently, Trudeau replied, “In general, the vaccines have been arriving in Canada in steadily increasing numbers.” Tell that to CNN. — As seen on TV: Conservative Leader Erin O’Toole kicked off Tuesday’s Question Period with a query about a CNN report about Canada that first aired on Jake Tapper’s Monday afternoon show. “Will the prime minister admit that his failure to secure sufficient vaccines is leading to a catastrophic third wave?” the Conservative leader asked. O’Toole’s team would later use the QP exchange to bait the news anchor in a set-to best left on Twitter. It’s O’Toole’s job to hold the government to account and there’s no end to the serious questions in need of reply. Corridors asked a few pollsters about the tricky work of turning things up to 11 in the middle of a pandemic. “Mr. O'Toole will have a hard time finding a broad audience who would agree that the prime minister is to blame for the third wave,” pollster David Coletto of Abacus Data told us Tuesday after QP. “While people were frustrated with some of the delays in getting vaccines procured, they are equally frustrated with the slow rollout of vaccines in many provinces.” — Voice of frustration: Shachi Kurl, president of the Angus Reid Institute, points out that few Canadians have time to follow the House these days. “But for those who are watching and for those who are feeling that frustration, that anger, that fatigue, he’s got to be there to point out what he considers the failings to be,” she tells Corridors. “If he doesn't, he’s really not doing his job.” — O’Toole’s challenge: Coletto points to polling that suggests that while most Canadians think the federal government has done a decent enough job during the pandemic, they are souring on their provincial governments. “The attacks on Mr. Trudeau may come off as partisan sniping if he's not also criticizing Mr. Kenney [Alberta], Mr. Ford [Ontario] and Mr. Legault [Quebec] for the decisions they have made,” Coletto said. “And he’s not going to do that because he needs their support.” — Looking ahead: Pandemic management is a legitimate issue, Kurl said. But to those who would assume it will be the ballot box issue, she cautions: “You could have a Canadian electorate that is so sick of talking about the pandemic after 18 or 19 months that it won’t be a consideration for them at all.” | | | The big question: Just how big will the Trudeau government’s stimulus plan be? Freeland has pegged the package at between C$70 billion and C$100 billion. But since her fall update, the Canadian economy has performed better than anticipated. The Biden administration is also preparing a massive recovery plan, which is expected to generate economic benefits for its northern neighbor. — The inside scoop: A senior Canadian official tells Corridors to expect the stimulus to land around the range Freeland has laid out. The insider said bond-rating agencies maintained their credit ratings on Canada after Freeland’s fall announcement, which they argued has, in effect, given the government a “pre-approved mortgage.” The official said the frame of the budget hasn’t changed since the Speech from the Throne — and that child care is going to be a major piece of the plan. The budget will also feature spending for social and physical infrastructure and an enhanced climate plan to help the country reach net zero by 2050, the insider said. The government, they said, also wants to make sure industries and businesses are well positioned for what the world wants to invest in and buy in the future. — Related reading: “Canadians want more than a financial update,” budget veterans Scott Clark and Pete DeVries write in a blogpost that compares The Parliamentary Budget Officer’s prebudget outlook (“a status quo forecast”) and a new C.D. Howe Institute report with “growth through austerity” projections. Like apples and oranges, the former Liberal Liberal finance officials noted of the reports before throwing shade at the think tank’s shadow budget, likening its recommendations to “the same model adopted by [former prime minister] Harper over 10 years at the expense of lower economic growth.” Here’s Christopher Reynolds of The Canadian Press with what the federal opposition leaders want to see in Monday’s budget. | | | This week, Corridors asks: What do the recent Conservative, Liberal and NDP conventions signal about the issues that will dominate the next federal election campaign? We also asked our pundits about their latest thinking on election timing. Cameron Holmstrom, consultant at Bluesky Strategy Group and NDP strategist: After the conventions, it’s clear the next election campaign will be all about Covid, as it should be. It would be impossible to decouple this pandemic from discussions in the next campaign. Any leader that tries to look beyond this crisis, or move on from it with a “status quo” approach, will come off as out of touch. This campaign, when it comes, will be one of the most unique in Canadian history. — On timing: Given the spiking case numbers and variants, it seems unwise to have an election this spring or even summer. Having been on “Team Fall” for a while, the Covid events of the past weeks re-affirms my belief that if a campaign comes in 2021, it will be in the fall. But if Covid continues at this pace, 2022 may become more likely. Greg MacEachern, senior vice president at Proof Strategies and Liberal strategist: Of the three conventions, the Liberals seemed to have the base most satisfied with party leadership (no major contention over resolutions, hello climate change deniers) and party organization (no complaints about tech issues or riding funding, unlike the NDP). In the end, the conventions may have been more indicative of how ready the relative party apparatuses are, and how happy (or unhappy) their volunteers may be. — On timing: If a province that is half-island and in the Atlantic Bubble (Newfoundland and Labrador) has pandemic challenges, then the potential for country-wide problems remain. If this answer could choose a theme song it’d be The Happenings’ “See You In September.” Kate Harrison, vice president at Summa Strategies and Conservative strategist: There’s not a consensus ballot box question right now. Covid-19 response (including permanence of relief programs via a Universal Basic Income), and how far and fast to move on climate policy will feature prominently. A bigger factor than policy may be the appetite for change. Right now, voters seem happy to stay the course, which is a problem for O’Toole and NDP Leader Jagmeet Singh. — On timing: Vaccine rollout is the biggest factor. The Liberals’ record on this isn’t strong, and pointing fingers at the provinces won’t matter to voters who don’t distinguish between who’s procuring vs. administering the shot. They’ll likely want to wait until overall vaccination rates are up before pulling the plug, which could happen late spring or early summer. | | | “In some ways, it’s as though the War in the Woods that began in the mid-1980s and lasted a decade is still going on” — Terry Glavin reports for Maclean’s from Vancouver Island’s southwest coast. New Yorker writer Raffi Khatchadourian calls “Crackdown in Xinjiang” the most important thing he’s worked on at the magazine since starting in 2007. Read for yourself, if you have not already. Calgary Mayor Naheed Nenshi speaks with Elamin Abdelmahmoud about his commitment to a “purple” politics on Tuesday’s edition of CBC’s frontburner. The mayor’s conversation with David Common on Sunday Morning is another good one. Who is Kacey Montagu? Read Christopher Cadelago’s story about the rise of a fictitious reporter who duped the White House and the press corps, then hear him talk about it on POLITICO Dispatch. | | | — Biden's ‘trust the science’ approach hits a political snag
— DataPoint Analysis: Biden lays out first budget request
— National Climate Adviser Gina McCarthy: Focus on 2030 climate goals, not 2050
— Why the president can’t quickly solve the computer chip shortage
— Erie County proposes vaccine mandate for Bills fans | | | | 
Canada’s Chief Public Health Officer Theresa Tam shared her vaccination shot on Tuesday. A Pfizer, for those who are curious. | @CPHO_Canada | Spotted: Canada’s Chief Public Health Officer Dr. Theresa Tam: Jabbed. … Stephen Harper rolling up his sleeve. “I encourage all Canadians to get vaccinated,” the former prime minister tweeted. … Ontario Premier Doug Ford and Toronto Mayor John Tory also documented their shots … Minister of Crown-Indigenous Relations Carolyn Bennett giving blood. … Conservative MP Eric Duncan talking about Canada’s blood donor restrictions and working to end the eligibility ban. Birthdays: HBD today to Senator Percy Mockler (72) and Senator Margaret Dawn Anderson (54) … Senator Sandra Lovelace Nicholas will be 73 on Thursday and climate scientist Katharine Hayhoe will be 49 … Toronto Liberal MP Julie Dabrusin celebrates 50 on Friday, the same day Senator Frances Lankin turns 67, NDP MP Peter Julian turns 59 and Bloc Leader Yves-François Blanchet turns 56 ... Former Alberta premier Rachel Notley will be 57 on April 17. … NDP Liberal MP Daniel Vandal wil be 61 on April 18 … And, this just in: CTV Power Play host Evan Solomon will be 53 on April 20. Movers and shakers: Former Liberal cabinet minister Scott Brison will lead the 10-member Economic Growth Council tasked with making Nova Scotia “Canada’s startup capital.” … Mariam Memarsadeghi is the newest senior fellow at the Macdonald-Laurier Institute … Nova Scotia Chief Medical Officer Dr. Robert Strang will pick up an honorary doctor of laws degree on May 2 … Lisa-Marie Inman has been named executive director, Secretariat of the National Security and Intelligence Committee of Parliamentarians. Farewells: Canadian war correspondent Matthew Fisher died over the weekend. Just the opening of the National Post's obituary give you a sense of his career: “Fisher was a Canadian war correspondent from a bygone era, a globetrotting solo reporter of no fixed address who witnessed the greatest and most dire news events of the last half century, from the fall of communism through the campaigns against al-Qaeda and ISIS.” Media moves: Alessandra Galloni will be the next editor-in-chief of Reuters News. … Stephanie Levitz is leaving The Canadian Press. … Bill Fortier is the new Alberta Bureau Chief for CTV National News … The 2021 Travers Journalism Fellowship has been awarded to Sadiya Ansari and Alex Boyd. … Props to Ginella Massa and Roshni Murthy, members of the May cohort of Poynter’s Leadership Academy for Women in Media. Send social notes to sallan@politico.com. | | | The revolver, depicted in last week’s Corridors and now found in the Canadian Museum of History, is connected to the assassination of Thomas D’Arcy McGee. For more, check out Whelan’s Gun. John Dillion of the Business Council was first to reply. Props to Arthur Drache, Bruce Graham, Ron Creary, Doug Sweet, Paul Gillett, Fred Yackman, Walter Robinson, Andrew Work, Andrew McGillivary, Zavie Kucer and Larry Gray. This week’s question: | 
The Proclamation of the Constitution Act, 1982. It was signed by Queen Elizabeth on Parliament Hill on April 17, 1982. | Library and Archives Canada | Why is the ink smudged on the Proclamation of the Constitution Act, signed on April 17, 1982? Email sallan@politico.com with your answer — or with trivia suggestions. With thanks to Luiza Ch. Savage and John Yearwood. | | | | Follow us | | | | |  |
