Its Springtime in Canada and the Election Promises Come Easy

 

The federal election has taken on a somewhat bi-polar ambiance alternating from existential dread in the face of Trumpian tariff and annexation discourse to the usual vote buying behaviour with what is ultimately taxpayer’s money no matter who wins.  Indeed, the election promises have been coming fast and furious popping up like spring flowers. One might have expected that Canadians were going to get thoughtful proposals on how Canada and Europe might come together in a new economic and security alliance, perhaps with additional links that included Australia, New Zealand and the UK in a new global partnership spanning the Atlantic and Pacific via the Arctic.  This after all is probably one of Canada’s more consequential elections ranking up there with 1911 and 1988 given the focus on our economic relations with the economic behemoth to our south.

For the most part, Canada’s party leaders are not painting a compelling vision of how Canada will make its way in a dangerous and shifting geopolitical world devoid of American leadership over the next quarter of the 21^st century.  For the Conservatives, the campaign has not gone the way they were expecting given their substantial lead has evaporated with the arrival of the new Liberal leader.  The Conservatives seem unable to move beyond the baggage of the Trudeau administration which correctly speaking is indeed also the baggage of the new Liberal leader.  However, the conversation has shifted away from the baggage at the rear of the train to the oncoming Trump tariff freight train and the Conservatives have not pivoted with it. 

The NDP have quickly evaporated with progressive voters shedding them and flocking to what is perceived as the next best progressive hope.  As for the Liberals, they have been saying all the right things in the face of the existential challenge and their leader looks the part but they are short on actual details.  Indeed, there is the contradiction of Mark Carney first intoning that the old relationship with the United States is over and then after a phone meeting with President Trump saying that we will be negotiating a new economic and security relationship with the Americans.  One wonders what kind of new relationship can actually be negotiated with a President and Administration whose positions change like the wind. Indeed, one wonders if the conversation about what will be negotiated was more substantial than revealed?

When the tariff issue heats up as it did last week, it dominates the campaign’s attention.  Come April 2^nd, if the tariffs are again put on hold or are seen as not as severe, the campaigns will again revert to business as usual for Canadian elections as tariffs move into the background.  When not slagging each other’s personal finances or perceived abilities for the top job, the party leaders are hard at work laying the groundwork for a new era of deficit financed election promises.  Along with increased spending, all the parties have apparently seen the light when it comes to tax relief and indeed, they are finally addressing the needs of the lowest income earners. 

The Conservatives have pledged to slash the lowest income tax bracket rate by 2.25 percentage points to 12.75 percent.  And of course, they promise to completely eliminate the carbon tax for both consumers and industry.  The Liberals are not as generous promising only a 1 percentage point reduction down to 14 per cent and taking away the carbon tax only for consumers.  

Not to be outdone, the NDP have gotten into the act by raising the basic personal exemption – for lower income earners only - and removing the GST from an assortment of essentials including diapers.  The Liberals and Conservatives however have their own GST reduction ideas geared towards making housing more affordable by taking the GST off new homes with the point of difference being whether it should apply to homes up to$1 million or $1.3 million – assuming a million-dollar home is in your price range of course.  But, as one famous past cabinet minister in days long gone once purportedly remarked – What’s a million?

All this tax relief will have revenue implications - that at least for the Liberal and Conservative proposals, have been estimated in the six-to-fourteen-billion-dollar range.  While tax relief is welcome, all parties are also promising a lot of other things which require spending more.  And all the right buttons are being pushed depending on the day of the week and the location.   If it’s Windsor, then it is assistance and training for automobile production and workers.  If in Hamilton, support for steel in the fight against tariffs.  Rural Quebec or Saskatchewan means that our price support and regulatory systems for food products are sacrosanct. 

And if in Northern Ontario, make sure to promise an end to the red tape and a $1 billion road to the Ring of Fire to unleash the mineral development potential that has been anticipated there since at least 2007.  Though unlike a certain provincial premier who shall remain nameless, none of the federal party leaders has yet to promise that development will occur even if they have to go up there themselves and ride a bulldozer.  And of course, everyone is going to spend more on the military and the Arctic as well as make sure that robust COVID era style spending supports are available to assist both businesses and workers who might lose their jobs. And we all know how that turned out the last time.

The choice facing Canadians this election is indeed important.  If this was a normal time without the existential threats and geopolitical shifts, the Conservatives would be facing a government that was fairly long in the tooth. The Conservatives would be riding the clamour for change with their mantra that Canada is broken, and that the Trudeau Liberals have given us a lost decade culminating in an affordability crisis.  However, as noted, the ground has shifted, not that things were really that simple before.

The Canada is broken motif is somewhat of a stretch.  Millions of people do not normally immigrate to broken countries; indeed, the converse is usually true.  However, the actual handling of immigration over the last five years can be pinned on the incumbent Liberals.  While not broken, Canada could definitely have worked better on a number of fronts over the last decade particularly when it came to resource sector investments and productivity in general.  And the housing sector affordability and health care crisis has been aggravated by immigration amounts that were not accompanied by adequate investment in those critical areas.

The lost decade motif really depends on what you think has been lost.  If you are of progressive bent and favour government involvement in daily life and the economy and on social issues, then the last decade has not been lost at all. It has been a glorious aspirational triumph that has seen an expansion of the federal civil service, new permanent income supports for children, increased health transfers, school lunch programs and dental services.  On the other hand, if you were hoping for a productivity agenda that boosted business investment and generated rising per capita GDP, efficient management of public services including better health care, then it has been a lost decade.  You can see that there is a pretty strong difference of opinion here.

Of course, as has been wisely noted in this election, it is always easy to criticize and find fault especially if one is devoid of real-world experience like say an ivory tower academic might be.  On the other hand, what do we mean by real world experience?  Do a career politician or maybe even a finance guru - who all are removed from the nuts-and-bolts world of factory floor manufacturing production or a construction site – actually have real world experience?  Our politicians often portray themselves as being experienced with real world issues but in the end their primary skill is being politicians.  And they do not like informed critics, they like cheerleaders.

Even without real world experience, one can still fathom that a sudden mania for tax reductions combined with the ramping up of spending on a plethora of initiatives that have not been vetted for value for money is a harbinger of fiscal danger ahead.   Given the parallel nature of spending and tax initiatives across the major parties, combined with a lack of detail on the Trump tariff file, one is left with the realization that none of the parties probably really know what they are going to do after April 28^th.  How can they, given the mercurial volcano that is Trump? This makes the job of voting this time around even more difficult.  One sometimes envies the voters in Quebec who if faced with unpalatable choices across the three main federal parties, can always opt for the Bloc. 

Somewhere, there is an alternate reality where Canadian voters can vote for a party that combines the NDP spending and social agenda that provides a never-ending cornucopia of public goods, with Conservative managerial rectitude to ensure value for money and a reassuring Liberal technocratic global influencer as Prime Minister.  Alas, we are living in a quite different reality. A lot of spending and tax promises are being made in the heat of this springtime election.  While the easy and hopeful promises of a springtime election are palatable now, the reality is that spring and summer are short in Canada and winter always comes.

 

 

Tallying the Election Results in Thunder Bay

 

The people have spoken and Thunder Bay – along with all the other municipalities in Ontario – has a new mayor and council.  Congratulations to the incoming Mayor and City Council members as well as to all the candidates who put their names forward and ran.  Running for office and serving as the public in an elected role is a challenging and important task and vital to the functioning of our system of government.  

 

 It was certainly an interesting evening last night not the least because of the exasperating nature of the election results.  Despite our “state of the art” modern election system in Thunder Bay that combines online, phone, in-person, and drive through voting and with over one fifth of eligible ballots cast in advance, it took several hours before any meaningful results were delivered.  One hopes that this process will be thoroughly reviewed because in order for the public to have confidence in their voting system, the smooth running and operation of the system sends an important signal and that was certainly lacking last evening.

 

As for the results, Figure 1 presents the winners as well as their percent share of votes cast.  With about 35,421 votes cast (at my last tally) Ken Boshcoff emerged the winner as Mayor with 38.2 percent of the ballots cast with Gary Mack in second place with 34.3 percent of the ballots cast.  The At-Large winners (with over 140,000 votes given every elector can vote for up to 5) were Mark Bentz (11%), Shelby Ch’ng (9.4%), Trevor Giertuga (8.6%), Rajni Agarwal (7.6%) and Kasey Etreni (7.2%).  In terms of the Ward races, Michael Zussino took Red River with 33.4% of the vote, Albert Aiello retook McIntyre with 63.3% of the vote, Kristen Oliver held Westfort with 45.9% of the vote, Dominic Pasqualino won in Northwood with 41.6% of the vote, Brian Hamilton kept McKellar at 53.5% of the vote, Andrew Foulds kept Current River with 74.9% (a ringing endorsement one might add) and Greg Johnsen won Neebing with 36.1 percent of the vote.  

 

 

 

Was this a change council? Not really.  If you want to see the results of a "change" election you should check out Hamilton's results where three incumbents actually lost their seats and there are ten new faces on their City Council which consists of a Mayor and 15 ward councillors. In Thunder Bay with a council of twelve plus a mayor, seven of the elected councilors are incumbents (Bentz, Ch-ng, Giertuga, Aiello, Oliver, Hamilton and Foulds). If one counts Peng You as an incumbent then there was an incumbent not returned. As for the Mayor, well he has been Mayor before and a familiar face and is effectively an honorary incumbent making for eight incumbents on council.  Are the other five a vote for change?  At best managed change given that they probably only won because a number of incumbents chose not to run thereby making room for a few new faces.  Name recognition is important in politics and in Thunder Bay given its closeted nature even more so, which is why constant calls for people to run because there is a “candidate shortage” was so amusing to observe this summer.  Ward contests with more than three candidates essentially guarantee a win for incumbents and At-Large slates with upwards of 25 to 30 candidates for five positions pretty much do the same for those races.  Sometimes, quality of candidate should be a more important consideration than quantity.

 

Will it be smooth sailing for this council?  There are a lot of issues coming down the pipeline – not least of which will be policing - and one expects the honeymoon period will be short-lived especially with an anticipated major hike in property taxes being rumoured.  The other interesting issue is whether or not we should reform City Council and go to a fully At-Large system of between 8 and 12 councillors plus a mayor.  I would say the answer is a definite no.   If one looks at the results in Figure 1, the five At-Large winners have each won with barely 10 percent of the votes cast in their favour in the At-Large competition. They can claim to “represent” the interests of the entire city, but it remains that they do not have an overwhelming mandate aside from the fact they got the biggest numbers in a ranking.  The mayor’s position did somewhat better at nearly 40 percent.  It is the wards where the strongest mandates have emerged.  In three of the seven wards, the winners actually got a majority of the votes case, while in an additional two they were over 40 percent.  I would say there if you truly wanted democracy, there is probably a better case for an all-ward system than a fully At-Large system.

 

One other point.  Take a look at figures 2 and 3.  These are the “projected” winners based on the TBNewswatch online polls that took place the weeks of August 20 to 27 and October 7 to 17.  They are a mix of highly accurate projections and wildly off the mark results.  In the case of the mayor’s race, the McIntyre, and Current River Wards they were consistent with the actual election results though the percentages vary quite a bit.  For the At-Large race, they consistently showed Bentz as a winner but there was quite a bit of variation in the others over time.  Pretty similar conclusion from the remaining ward competitions which saw quite a few flip-flops though in the case of some wards like Westfort they probably reflect the closer nature of the race.  In the case of McKellar or Neebing it was either a really volatile race or well…something else perhaps given the nature of online polling.

 

So, to repeat, congratulations to the new mayor and council.  And of course, once again the drama begins.

 

 

 

 

 

 

 

The Next Council: The Challenges for Thunder Bay

 

Shortly, there will be a municipal election in Thunder Bay with a new council selected.  It is likely there will be a major change in composition with quite a few new faces and this will usher in a period of change though perhaps not as much change as one might expect.  In the end, The City of Thunder Bay is a corporation and what an election does is essentially select its board of directors who serve as an executive laying out direction with execution and implementation being the responsibility of the City Administration. Sometimes, the more things change, the more they stay the same.

 

The City Manager reports to City Council and is responsible for putting into effect the directives of council within the framework of what is allowed by the Province of Ontario. More importantly, the City Manager and Administration possess the information set from which the councillors then make their decision.  As well, given their role as full time employees rather than part-time representatives,  they have the time to deal with the detail of issues.  Inevitably, some councillors will find the level of information and detail overwhelming.  The overwhelming  complexity of issues in the past has often resulted in meetings where councillors on the advice of administration quickly make decisions on millions of dollars of spending and complicated bylaws with long-term impact while then spending hours debating relatively minor matters involving a few thousand dollars.

 

There are some departing members of the outgoing council that it will be sad to see go given that among them are the remnants of what passes for a fiscal conservative in Thunder Bay political life these days.  Based on a perusal of the candidate slate currently up for election, this is likely to be one of the more activist councils that Thunder Bay has seen in some time and their first test will be the 2023 budget.  A relatively new council will be heavily dependent on the advice of administration and also eager to deliver on whatever promises they have made and agendas they campaigned on, and the result will likely be a heftier tax increase than has occurred over the last few years. 

 

The Mayor’s position is essentially one of first among equals despite whatever strong mayor powers are eventually afforded by the provincial government to Thunder Bay.  The outgoing Mayor was good for Thunder Bay given he was articulate, well informed and lent a certain dignity and gravitas to the position – though some times while in the midst of yet another marathon Zoom meeting he seemed increasingly exasperated and resembled an artist being forced to work on a much smaller canvas.  Such a sentiment is understandable, but the Mayor might have been happier by drawing inspiration from others in Thunder Bay and northern Ontario in a range of positions and occupations who have made a career of working on a smaller canvas.

 

In the end, the challenges for the next council are many.  There is a housing and homelessness crisis in Thunder Bay that parallels that in other cities given the climb in rents and home prices during the course of the pandemic.  There is crime – with 12 murders already in 2022, Thunder Bay is well on the road to regaining its title as Canada’s murder city in per capita terms. And of course who can forget infrastructure whether it is roads and sewers or recreational infrastructure given that the Turf facility has reared its head as an issue in the election with some candidates expressing support for the concept but not at the original high cost. 

 

Surprisingly, little mention has been made of the other chaotic infrastructure problem Thunder Bay faced during the pandemic which was the plague of leaky pipes in homes throughout the city  in the wake of the sodium hydroxide water supply lead mitigation experiment.  Needless to say, the public silence from the outgoing Mayor and council on this issue - no doubt on the legal advice from City Administration and its lawyers given potential costs and legal liabilities - has left a bitter taste for many.  So much for a friendly community oriented city with your elected representatives always ready to lend an ear.

 

And the biggest issue?  Well elections are in the end obviously no place for serious long term policy discussions but the fact remains that Thunder Bay’s regional role as a centre for a growing and under counted Indigenous population is the big one.  Increasingly Thunder Bay and its municipal ratepayers are paying for regional services on a city tax base.  The latest example here is in the case of the Thunder Bay Police Service and the recommended changes that among other things ultimately mean the Police Service has to take a regional lens to its operations.

 

A move to a more regional approach in policing in the end is a continuation of a trend over the last twenty-five years that can be best described as informal and piecemeal northwestern Ontario regional government by default - a regional hospital service, a district social services board, a district emergency service organization, and regional public utilities such as Synergy North and TBayTel. Indigenous organizations have also established presence in Thunder Bay and Sioux lookout providing regional services to their members.  Yet, there was never really any type of democratic regional mandate for this evolution.  True, one can always blame the province or Ottawa given that much of this is under provincial or federal jurisdiction but our local municipal leaders to date have ignored the long term picture painted by this evolution.  After all, it is a complicated and overwhelming set of circumstances.

 

Of course the trend to more regional services is also a function of the claim that Thunder Bay has under counted its population and more services need to be provided to service this under counted population.  But how can you provide more services if you do not know how many people there are? After all, on the one hand there are claims made by some municipal candidates we are losing people “daily” to other cities but at the same time there are apparently tens of thousands more people here who need services.  Which is it?  Unfortunately, social surveys based on self-reporting and life stories however compelling and reflective of reality do not a rigorous estimate make.   

 

At minimum you would think we could put an estimate together ourselves based on local and regional electricity use from Synergy,  cell phone and phone subscriptions from TBayTel, patient counts (given they have addresses or OHIP cards) from medical facilities in the region, and school enrollments from all the public boards.  These should be correlated with population growth and enable an estimate with upper and lower bounds keyed to census benchmarks.  In the absence of this, one ultimately has to accept the Census results which do say that according to the 2021 census, the number of Indigenous residents of the Thunder Bay Census Metropolitan Area grew by about 12 per cent between 2016 and 2021, to a total of 17,000 people.

 

And so, what next?  Well, one suspects that after a honey moon period of sunny optimism,   it will be business as usual for the next council accompanied with a fairly hefty tax increase.  All the candidates acknowledge a lot of issues ranging from roads to crime to  homelessness to mental health to opioid addiction.  They don’t agree with increasing what taxpayers pay when it comes to revisiting the Turf facility and want to explore alternatives  like donations and fundraising but in the end they will solve problems by “taking action” and “working tirelessly” which usually means a tax increase as a starting point under the banner of investing in ourselves and then avoiding constituents when they complain too much. 

 

Nevertheless, hope springs eternal.  Maybe this council will be different.

 

 

Your Next Thunder Bay City Council …According to TBNewswatch Polling

 

With the candidacy window closed as of August 19^th, the race for the October 24^th municipal election is now on and there is no shortage of candidates in Thunder Bay.  Every Ward has a race and the At-Large race has the usual bounty of candidates.  There are five candidates for Mayor, 24 for the At-Large race, three in Current River, two in McIntyre, four in McKellar, six in Neebing, five in Northwood, six in Red River and four in Westfort – a total of 59 candidates.  That pretty much matches the last time despite the lamentations of woe early on that there were no candidates.

 

The more interesting question in light of such a magnificent display of civic interest and spirit is who is going to win in each of the races.  TBNewswatch provides a valuable public service with its polls on various issues and it has over the period August 20 to 27 run polls for each of the races. Of course, this is not an unbiased random sampling procedure and one suspects the technologically savvy can affect the results but if these polls are accurate, this is what your next council may look like (percentage of votes cast in brackets)

 

Mayor                                      Ken Boschoff  (51.90 %)

At-Large Councillors                Mark Bentz (15.96%)

                                                Shane Judge (13.22%)

                                                Stephen Margarit (11.64%)

                                                Shelby Ch’ng (11.06%)

                                                Kasey Etreni (8.86%)

Red River                                 Martin Rukavina (28.83%)

McIntyre                                  Albert Aiello (50.16%)

Westfort                                 Kristen Oliver (49.27%)

Northwood                             Dominic Pasqualino (50.16%)

McKellar                                  Brian Hamilton (43.42%)

Current River                          Andrew Foulds (60.61%)

Neebing                                  Shaun Kennedy (39.22%)

 

Some of these wards appear to have closer races based on the TBNewswatch poll – namely Red River where Jason Veltri (24.45%)  is a close second, McIntyre where Brent Boyko is a very close (49.84%) second and McKellar where Lori Paras is close (39.95%).   This is not a scientific poll and even if it was, the only poll that counts is of course the one on election day.  Still, if these trends are on the mark, there may be substantial turnover on city council.  Change and new viewpoints can be very positive and many of these front runners are relatively known quantities while others are relative unknowns depending on what social circles you move in.

 

 It is worth googling these candidates and checking out their self-provided bios which provide an eclectic mix of entertaining and informative reading.  Some are quite informative and impressive, listing a series of career and community accomplishments. Some mention family relationships or their deep community connections to Thunder Bay. Some mention what they want to accomplish with an explicitness that may lose them as many votes as they may win, and some are vague to the point of not really saying anything at all by providing an endless string of platitudes.  The other thing worth noting is if one were to plot the candidates who seem to be leading the “poll” on a left/right or progressivist/passivist continuum, Thunder Bay is probably about to elect a council that is even less concerned about taxpayers and tax rates than the previous one. On the other hand, they may surprise us all with their fiscal astuteness.  Still, on voting day, choices must be made and if they turn out to be good ones, so much the better.

 

The next council inherits a lot of issues: crime and policing, social issues and homelessness and addiction, crumbling infrastructure, expensive lawsuits mainly linked to water and of course the still flat economy which has been masked by the generous amounts of government money that has flowed into Thunder Bay on both a private and public level.  New councillors will come in with pet projects and agendas but will quickly find that they must deal with resource constraints, a bureaucracy which generally has more information than they do and their own vested interests, and issues that will pop in from out of the blue.  New councillors will need to be quick learners, multi-talented, adaptable, patient and open to criticism both warranted and unwarranted and take it all in with a smile.  However, they will probably be spared from feeling like having to do windows on a skyscraper while perched on a precarious and narrow wooden seat. 

 

Is There Really a Municipal Candidate Shortage in Thunder Bay?

 

Outgoing councillor Rebecca Johnson has joined city administrators in raising the alarm over what appears to be the low number of confirmed candidates for this fall’s municipal election.  In 2018 there were apparently twice as many registered candidates at this point.  On the one hand, this is probably not a surprise given the last few years have been exhausting because of the pandemic not to mention the worst winter in two decades has left people scrambling to repair damage to homes and basements.  People are preoccupied on numerous fronts now and running for council is probably not at the top of their list.  Moreover, there is still almost two months to go until the August 19^th deadline and if the past is any indication, there will be plenty of candidates springing from under the woodwork any day soon.

 

Of course, given the record low turnout in the recent provincial election, it is a reasonable question to ask if there is a lack of engagement with this year’s coming municipal election.  Political life has never been more challenging given the presence of social media which makes election campaigns often more akin to a process of ritualistic character assassination than a debate of ideas.  There is probably also a sense of fatigue in Thunder Bay over constant issues that never seem to be resolved and in recent years appear to have only grown whether it is crime or deteriorating infrastructure.  One expects this year’s issues will be quite similar to those of 2018 and one senses this endless wheel of time litany is discouraging to many.

 

And then there is the process of running for municipal office which is not just about signing up to appear on a ballot, but which over time has involved like everything else into a more involved bureaucratic process.  Nomination papers must be filed by appointment only.  You need the endorsement of at least 25 people if you wish to run for Mayor or councillor – a spur of the moment decision it is not.  There is a filing fee, a declaration of qualifications and a consent to release personal information.  While one might want to discourage frivolous candidacies, at the same time, one may need to review the process to see if it can be made more candidate friendly.

 

Yet, it remains that there is probably not going to be a shortage of candidates.  This type of hand wringing has happened before and will happen again.  During the 2018 municipal election campaign in Thunder Bay, there were similar concerns being expressed by early July as with the exception of the Mayor’s position, there was a drop in the number of candidates seeking municipal office in most of the wards.  It turns out after the story went out, a slew of candidates came forth and the total number of candidates running for municipal office in Thunder Bay rivalled that of much larger cities. There were 101 candidates vying for office of 2018 with 26 going after an at-large position which pretty much guaranteed victory for incumbents.

 

In the end, the chief beneficiary of a plethora of candidates is incumbents who already have deep rooted name recognition.  More candidates split and fracture any opposition vote whereas fewer candidates running allows dissenting or dissatisfied voters an opportunity to coalesce around an opponent and bring incumbents down. It is noteworthy that many incumbents have not declared yet either – including the current Mayor.  Incumbents announcing too early potentially scares off candidates and reduces the candidate pool, so the trick is to lay low and wait for the competition to reveal itself in sufficiently large numbers and then emerge.  One suspects the same is going to happen yet again and by August we will be lamenting that there are too many candidates, and the same faces will be getting in again.  Thunder Bay’s wheel of time continues.

 

 

Is Thunder Bay About to Reverse its Conservative Drought?

 

The Ontario provincial election is now well underway and the poll tracking results to date suggest that the Conservatives under Doug Ford are poised to win another majority government.  The Liberals are projected to increase their seat count but largely at the expense of the NDP.  The Conservatives have adopted policies and platforms that are appealing to a largely centrist voter profile and there are substantial infrastructure spending announcements sprinkled across the province designed to consolidate their support.   In some respects, all three parties are making spending announcements like it the 1960s- money seems to be no object. While still early days, the opposition parties have yet to really come across as a credible alternative but who knows. 

 

Here in Thunder Bay, the question is whether the provincial Conservatives can reverse what has been a historic pattern of Liberal representation punctuated with bouts of NDP as a palate cleanser.  Last time around, the NDP took Thunder Bay Atikokan from the Liberals narrowly edging out the Liberals with the Conservatives a distant third though they did increase their support by about 10 percent and did better than the Conservative on the north side.  This time around, the incumbent is NDP, and the two opponents have somewhat lower profiles in the riding than what one might expect.  Still, the NDP incumbent won by a rather small margin and depending on how the campaign shapes up, there is always the possibility of change.  The south side Conservative candidate does have a background in municipal politics.

 

On the north side, things are more interesting.  With the incumbent not running due to health concerns, there is more of a race in progress.  The liberal incumbent won but by a relatively small margin and the runner up last time – NDP Lise Vaugeois – is running again.  The Liberals have current south side Northwood municipal Councillor Shelby Ch’ng running while the Conservatives have recruited municipal Councillor Peng You.  This is a riding that historically is even less fertile ground for the Conservatives than the south side of Thunder Bay. And yet, the conservatives probably have their best shot here at reversing their Lakehead drought.

 

Councillor Peng You is personally very popular with an extensive network of friends, acquaintances and supporters acquired via his years as a Tai Chi master.  His victory as an At-Large Councillor in the last municipal election saw him top the candidate totals with the largest tally of votes.  He has facilitated a lot of international exchanges and is well liked by those who know him.  While his performance as a municipal councillor has occasionally been erratic, that can be attributed to the previous lack of political experiences and a business background not schooled in the byzantine bureaucracy of municipal affairs.  He has also been engaged in extensive door knocking across the city.  And the provincial government has announced several high-profile infrastructure projects in the region to boot.

 

Will all this be enough to get a Conservative victory?  Who knows?  However, the recruitment of Peng You is the most serious attempt by the Conservatives to attract a high profile Thunder Bay candidate to run in years.  The possibility to have someone on the government benches is probably not lost on some of the locals especially given that the prospects of a majority government look high.  It will be an interesting merry month of May. 

 

 

A Liberal Hiatus in Thunder Bay?

Long-time standing MPP Michael Gravelle has announced that he is not seeking re-election in the riding of Thunder Bay-Superior North because of his ongoing health issues.  Mr. Gravelle has held the riding since 1995 and the popular Mr. Gravelle has seen his victories be by large margins.  One wishes him well with hopes for a speedy recovery.  At the same time, his departure leaves a gap for the provincial Liberals locally as well as provincially given the rather small contingent of provincial liberals elected the last time around. 

 

Thunder Bay voters historically at both the federal and provincial levels tend to elect Liberals and when they seek to punish them opt for an NDP candidate instead.  Oddly enough, Thunder Bay voters are indeed very conservative voters in the sense they have been doing the same thing for a long time. Federally, the last elected Conservative was Robert J. Manion in Fort William though MP Joe Commuzzi went over to the Conservatives in 2008 after being elected as a Liberal.  Provincially, the last Conservative elected in Thunder Bay appears to be Mickey Hennessy in the 1970s/early 1980s again on the Fort William side.  At present, Liberals hold both ridings federally (now known as Thunder Bay-Atikokan and Thunder Bay Superior-North) and the NDP holds the former Fort William riding with Mr. Gravelle on the north side.

 

Provincially, polling suggests that the Conservatives under Doug Ford are poised to do quite well with the opposition parties not able to gain a lot of traction with their opposition to a government that has become both centrist and populist. The Liberals in Thunder Bay have yet to name a candidate on the south side with the expected candidate, the ever astute  Bill Mauro deciding he would rather rule in hell than serve in heaven by taking his chances as Mayor.   Now, there may be another vacuum on the north side.  If candidates are not named soon, the provincial Liberals may be handing the ridings over to an NDP-Conservative race.

 

The provincial Conservatives appear to be paying the two ridings a fair amount of attention and there have been quite a few announcements which amount to substantial provincial dollars flowing into the region.  They also have their candidates lined up.  They already have Mayor of Conmee Kevin Holland running on the south side against NDP incumbent Judith-Monteith Farrell and Thunder Bay City Councillor Peng You on the north side.  Councillor You is considered a high profile catch for the Conservatives given his high vote count as an at-large councilor nearly four years ago.  At the same time, there has been some rumblings of dissatisfaction expressed about his performance on Thunder Bay City Council in terms of accomplishments to date.

 

So, what will happen?  Given the tea leaves as to what may happen province-wide, there may not be a lot of local Liberals willing to put up with the public social abuse that passes for an election campaign these days.  Even with what have traditionally been strong local organizations at the federal and provincial levels, they may not field candidates at all.  This would leave the race to essentially the other two parties and the interesting question will be if Thunder Bay Liberal voters simply embrace the NDP candidates or if the higher profile Conservative candidates this time have more of a chance. 

 

 

A Spring Election Is Coming to Ontario…Money is Flowing Like Spring Melt

 

The Northwest of Ontario is still gripped in throes of winter relative to southern Ontario, but spring is inevitably on its way along with a Spring Budget at Queen’s Park (April 28^th) to be followed by a spring election in early June.  The Northwestern Ontario Municipal Association (NOMA) will hold its annual conference and general meeting April 27-29 in Fort Frances and the meetings will overlap the budget date.   There will undoubtedly be the traditional lament over the region’s needs especially in the aftermath of the pandemic, but the truth of the matter is that municipalities - even in Ontario's north - have generally done quite well financially during the pandemic as has the provincial government for that matter. 

 

Municipalities generally run surpluses (or in the language of municipalities, positive variances) and the pandemic does not seem to have changed that.  And, because of federal transfer supports and growing own source revenues, Ontario has seen provincial total revenues rise since 2017-18.  Based on the Fiscal Reference Tables and the Ontario 2021 Fall Economic Statement, total revenues were $150.594 billion in 2017-18 and reached $164.893 billion in 2020-21.  Fiscal year 2021-22 is forecast at $168.617 billion while by 2023-24 the forecast is for revenues of $178 billion. 

 

If anything, the numbers will likely be revised again in the April 28^th budget to show higher revenues than anticipated and a smaller projected deficit as even the Financial Accountability Office of Ontario (FAO) has already noted.  For 2021-22, the FAO expects a $16.0 billion budget deficit, lower than the government outlook for a $20.5 billion deficit. By 2023-24, the FAO projects the deficit will decline to $2.8 billion, compared to the government outlook of $11.4 billion.

 

So, one can expect that with robust provincial revenue growth and an election in the wind, there will be plenty of spending or “investments” in projects and programs across the province as the province fans out its ministers and spending announcements as a sort of missionaria protectiva to secure as many seats as possible.  Indeed, the spending has been underway since March and currently totals nearly 11 billion dollars.  Some of these announcements are really tax expenditure or foregone revenue in the case of the refund and cancellation of vehicle registration fees (approximately $2.2 billion) as well as the gasoline and fuel tax cut to take effect this summer ($645 billion).  Some are substantial infrastructure projects with billions of dollars for hospital and long-term care construction as well as highway projects. 

 

In terms of specifics for northern Ontario municipalities to date, there are four announcements of note: 1) The industrial electricity subsidy for northern Ontario ($176 million), the refurbishing of GO Transit train coaches’ contract for Ontario northland North Bay ($109 million) and the contract to widen the Thunder-Bay to Nipigon highway ($107) and 4) Rural Broadband internet ($900 million) which one would expect a reasonable share should flow to the north.  These are not inconsequential amounts or projects from a regional perspective and come on top of other announcements such $75 million for resumption of Ontario Northlander train service from Timmins to Toronto.  Throw in money for more medical doctor training with the expansion of NOSM and you can see a deliberate effort to woo northern voters.  Watching the opposition parties use the northern neglect line will be interesting given that many of the northern ridings are indeed held by the opposition and not the current government.

 

Of course, the budget next week will probably unveil even more spending initiatives given that revenues are likely higher than expected which means the government will be able to spend more and lower the deficit.  As for the province’s $400 billion dollar debt and high net debt to GDP ratio?  An election is coming, and an election is too important a time to worry about public finances as politicians have demonstrated since time immemorial. And besides, what politician would not want a future without challenges for their grandchildren especially when there is an election to win?

 

 

Sorting Out the Day After

 Well, the results are in and little has changed at the federal level at least on the surface.  What was viewed as an unnecessary election has yielded the anticipated result - a minority Liberal government with little to show for the effort aside from the expenditure of over $600 million dollars to run a pandemic election. The distribution of seats has changed little.  It may be tempting to conclude that little has changed and it is business as usual but the election does have a number of longer-term implications.  

First, it has introduced Canadians to Erin O'Toole in a major way.  He is now a more visible leader and does position him well for a second run.  He did not do better partly because of the upsurge in support for the People's Party, partly because in the GTA voters decided the Liberal child care plan was more to their liking and partly because the Ontario conservative political machine essentially stepped back.  He now has the opportunity to work at remedying that state of affairs.

Second, all of the three major parties have essentially been weakened and being weak creates insecurity and the prospect of a more fractious and unstable parliament at a time when the pandemic is still on.  The Liberals may indeed argue that we now need to work together to finish off the pandemic but the counter will be that despite a pandemic we had an election anyway so the prospects of being punished for a pandemic election grow weaker as a threat.  Pulling the trigger will be easier the next time for both the liberals as well as whatever party is propping up the government.

The Liberals wanted a majority and did not get one and the acrimony of the campaign means a less civil climate for working together with the other parties.  While the NDP party will still support them, the price for their support will inevitably move upwards but at the same time, given that they did no better than last time, the NDP will not have as much leverage as they might imagine.  And the Conservatives will have a lot of regrouping and thinking to do given their platform in the end did not make the inroads into the urban areas that they would have wanted.

Interestingly enough, in the dying days of the campaign, the Prime minister noted he was willing to consider electoral reform - again.  Of course, why he would now want to abandon a first past the post system that allows him to form a government with barely one third the popular vote is something that remains to be seen.

So, that is where we are at for the time being.

 

Do the Liberals Deserve a Majority?

 

This election is only about whether the current governing party deserves a majority.  It is not about who is the best steward of the economy, who has the best housing plan, who can manage the pandemic best or even issues like what should Canada’s foreign policy or trade policy be in the currently fractured world.  It should be about all these things, but these things are only a veil for what is the real issue.  Given a minority government that appeared to be working, was an election during a pandemic for the sake of trying to get a majority something the current governing party should be rewarded for?

 

That is a good question.  The answer really depends on what happens after this election.  If the Liberals get their majority – a prospect which currently appears problematic– then the federal business of government will continue pretty much as it has whether you like it or not. The rolling of the dice will have been rewarded with the anticipated prize and the universe will unfold as Liberal strategists desired. 

 

If there is a Liberal minority, then all was for naught, and we are back to a minority government that requires the support of at least one of the other parties - but the mandate of the Liberal minority will be weaker.  While they are still the government, they did not get their majority and the prospect for good relations with other parties after the rancor and rhetoric of an unnecessary election will shorten the life of the next parliament considerably.  It is a recipe for more unstable government, but with some continuity in dealing with the resurgent fourth COVID wave given the Liberals will still be in charge at least for a short time.

 

Suppose there is a Conservative or for the sake of argument an NDP minority government.  Then once again we have a prospect for unstable and short shelf-life government and probably a fair amount of chaos during the transition.  As the fourth wave grows, we will be busy watching to see who the new cabinet will be and what the policies transpire and who is going to be supporting the government and who is not.  Will the Liberals swallow their pride and support a conservative or NDP government?  Or will they simply retreat into sniping mode and leave the heavy lifting to the Bloc?  It is not a good prospect.

 

There is of course the possibility of a Conservative majority which solves the problem of the instability of a minority government.  However, there is still the prospect of transition. Ministers will be learning their portfolios and there is always the risk that if you change horses mid-stream, Canadians will simply fall into the creek.  In the end, one might argue it does not matter what happens.  After all, Canada’s political parties are really all middle of the road or centrist parties and all of them in the end will do pretty much the same thing but with differences in speed and intensity.  The NDP are simply Liberals in a hurry and the Conservatives are slower Liberals and Liberals are whatever they think Canadians want them to be. 

 

Moreover, politicians are merely actors on a stage and the real decision making and business of state is done by the civil servants, and they are not going anywhere. Still, in the end, political leadership matters.  Vision and inspiration matter.  Prime Ministers matter because even if scripted some deliver their lines better than others while others interpret the role in unique and uplifting ways. Or at least they should.

 

I guess, the real question is should you reward the Liberals for going to the polls during a pandemic and risking the aftermath of chaotic instability of government and transition during a rising fourth pandemic wave?  Should they be rewarded for opening such a can of worms? The answer to that is invariably complicated and can best be summarized as simultaneously both Yes and No.   Think of it as an election variant of Schrodinger's cat.

 

 

 

 

International Relations & Trade Discussion Missing in Current Federal Election Campaign

Monday's Federal Leader's debate made nary a mention of international trade, our current dispute with China or even what is going on with the USMCA ratification in the United States.  With exports accounting for about 30% of our GDP, it is astounding that such an important issue is being ignored.  It is therefore worth re-posting the piece I had published early this week on the Fraser Institute Blog.

Canada needs more major trading partners beyond China and the U.S.

First Appeared in Fraser Blog , October 7^th, 2019

On the campaign trail, there’s little talk about Canadian trade policy and the repercussions of our current poor political relationship with China. The need to continue diversifying our trade is the elephant in the room this federal election.

In what seems to be explicit retaliation over the Meng Wanzhou Affair, China has detained Canadian citizens—putting a chill on business travel there—and essentially halted our exports of meat and canola. Any memories of Norman Bethune appear to have faded as China reveals its view of us as a small, inconsequential and puny power that should do as told. As a result, an important trade strategy—to diversify our trade away from dependence on what has also become a more capricious United States—lies in tatters.

The U.S. takes nearly 75 per cent of our exports, and despite recent bumps, has been by international trade standards a dream trade partner. It’s a large, rich, populous market literally on our doorstep where we share a close political and social culture, common language and history. It’s a market economy like ours with a strong rule of law. Subsequently, Canadians have not had to work very hard when it comes to exports given that the access to such a profitable market has historically been easy. A one stop export market for 75 per cent of your exports has become the gold standard of Canadian trade policy.

But Canadian business has been seduced by the prospects of China’s growing economy and the vision of a rich market of 1.4 billion people as a sort of future U.S.-like trade relationship. China has rapidly industrialized and is developing a large, dense and wealthy market. At first, it even seemed to be moving towards a more liberal market order in its economy.

Yet despite early promise, it would appear China is only playing lip service to liberal economic values and seems set on explicitly using trade relationships as part of its diplomatic and political arsenal, given that it views government policy and trade relationships as one dominion. Its recent behaviour raises an important question: Do we really want to ever be in a situation where 75 per cent of our exports are dependent on China’s market? Do we really want to give the Chinese government a quasi-monopoly over both our trade and political affairs?

It really would be the road to serfdom.

Despite the large dollar value of our trade relationship with China, it currently still only represents five per cent of our exports. Trade is about free exchange and mutually beneficial gains. If China wants our trade goods, we should certainly sell them as part of a free and open bargaining process. However, if it wants to use its economic relationships as a tool to get its way when dealing with countries on other issues, then we must protect ourselves. We are a small open economy dependent on trade and we must diversify our trade. Our recent efforts in negotiating agreements with the EU and the Trans-Pacific are only a start. We need many countries to compete for our business, but to do so we also need to show interest and compete for theirs. Part of this also involves reducing our own protectionism (agricultural supply management would be a good place to start).

If the Asia-Pacific is the future of trade, then look for opportunities in other wealthy Asian countries. Japan, India, Thailand, Vietnam, Taiwan, Singapore, Malaysia, Indonesia and the Philippines are all important economies that can serve as markets for Canadian products.

Moreover, instead of waiting for government-led initiatives, Canadian businesses should start the process themselves. Rather than placing all your eggs in a one-shot market-access strategy in the hopes that China can one day replicate our success in the U.S., shift your markets to other partners. Make sure there are a lot of them so no one country can ever hold our economy hostage. This should become the new gold standard for Canadian trade policy.