Mark Carney was elevated to the leadership of the Liberal Party and is the 24th Prime Minister of Canada…for now.
But now a federal general election has been called to clarify leadership for the tariff issues and 51st state talk arising from the U.S. President Donald Trump administration south of the border. Voters head to the polls April 28.
The contest will primarily be between Mr. Carney and Pierre Poilievre for the Conservative Party. These candidates share some similarities in background but could hardly be more different in career paths and personal style.
Mr. Carney’s resume is impressive. He’s been Governor of both the Bank of Canada and the Bank of England. In the private sector, he had stints with Goldman Sachs and Brookfield Corporation.
On occasion, he has shown a maverick streak. While with the Bank of England, he broke with a tradition of silence on public issues and spoke out vigorously in opposition to Brexit. He failed to convince voters, but whether he was wrong or right is still to be determined.
Mr. Poilievre, first elected as a backbencher in 2004 and Conservative Leader since 2022, is a career politician. He has often been characterized by the media as Donald Trump light, with similar plans for tax cuts, deregulation, and reducing the size of government.
Mr. Poilievre sailed to the top of the polls at the tail end of former Prime Minister Justin Trudeau’s long-in-the-tooth stewardship. Now, with the upswelling of patriotic pride in the country, he’s finding his party back on nearly equal footing with the Liberals and needing to adopt a political and economic strategy that will reduce ties to the U.S. and strengthen them with other countries. The implications for the promotion of infrastructure investment are clear, but more on that in a moment.
Mr. Poilievre has talked of defunding the Canadian Broadcasting Corporation (CBC) and has no love for the Bank of Canada. He’s not as attuned to the adoption of “green” measures as his opponents have been, and he favours strengthening the nation’s oil and gas industry. The marked difference between the Conservatives and Liberals on this score has been mildly blunted by Mr. Carney’s pulling away from a carbon tax to be paid by consumers.
Mr. Carney wants to make Canada a “conventional and clean energy superpower” with a stated fondness for nuclear, hydro, wind, hydrogen, battery storage, and carbon capture. Mr. Poilievre reveals his resource development inclinations in his support for fast-tracking and building access roads to the metals and minerals-rich Ring of Fire region of northern Ontario, where nickel, copper, chromite, and platinum lie in abundance.
What’s at Stake
Both Mr. Carney and Mr. Poilievre will be pressing to diversify Canada’s economy by geographic trading destination. There’s been revived interest in building oil pipeline capacity from the west to the Atlantic Coast to enable shipments to new customers in Europe. This would also have the advantage of using steel and construction labour that is likely to be sidelined by U.S. tariff action.
Quebec’s opposition to undertaking such work in the past was on environmental grounds, but Premier Francois Legault has indicated that, given the new extraordinary circumstances, the province may be persuaded to alter its stance.
The giant Canada LNG project in northwest British Columbia will soon see a production startup with output destined for markets across the Pacific. Aggressive lobbying by industry associations is already underway for a significant further buildup of this sector, with both the Liberals and Conservatives likely to lend sympathetic ears.
Canada’s gross domestic product (GDP) growth has continued to be solid, but where it is open to criticism is in terms of GDP per capita. There’s been one specific reason and it’s been the unusually rapid growth in the nation’s population, originating with remarkable levels of immigration. The governing Liberals opened the floodgates, but they have recently scaled back target foreign arrival counts considerably. As a policy position, the Conservatives have not been nearly as accommodating on the subject of an open border.
This population growth has become particularly important from a construction point of view in the residential real estate and new housing markets. Americans may think their home prices have shot up to unbelievable levels, but they barely hold a candle to what has happened in Canada. The rental occupancy needs from immigrant arrivals have been a key factor in driving up overall housing demand. Current annual housing starts in Canada are only about half of what is generally considered necessary.
All levels of government in the country — federal, provincial, and municipal — understand and appreciate the imperative to change zoning, density restrictions, and permit approvals to facilitate the construction of more housing.
Sound Finances and Flexibility to Navigate the Shoals
Whichever party takes over Parliament in Ottawa will be fortunate to have the backing of a sound financial situation. Both the deficit-to-GDP and the debt-to-GDP ratios in Canada are much healthier than in the U.S. This will come in handy when authorizing income support payments for individuals displaced from their employment by the tariff war if it continues unabated.
It will also help build highways, rail, ports, and other structures to ease the shipment of goods east-west to cross-ocean outlets, with less emphasis on north-south routes.
Finally, Canada is not a two-party system. The likelihood of a minority government is not far-fetched. While sometimes proving unstable, such a setup has also often provided great (and entertaining) governance. Therefore, it’s important to know that either the Liberals or Conservatives may need to be flexible in their platforms to garner the support of the New Democratic Party (NDP), Bloc Quebecois, or the Green Party.
In any event, attempting to successfully navigate the shoals raised by Mr. Trump will be the number one goal, by far, of all political parties in Canada for the foreseeable future.
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