https://www.bloomberg.com/news/articles/2020-08-26/trudeau-plots-sharpest-turn-left-in-economic-policy-since-1980s
Justin Trudeau Plots Canada’s Sharpest Turn Left in Economic Policy in Decades
https://outline.com/aPM37Y
Justin Trudeau’s selection of Chrystia Freeland to be Canada’s new finance minister cements her place as his most trusted lieutenant, hinting the 52-year-old former journalist isn’t done with her political rise. But its real significance is that it signals the most decisive lurch to the left in economic policy in at least four decades.
Freeland has firmly established herself as Trudeau’s Ms. Fix-It during their five years in power, handling President Donald Trump on trade and the energy-rich western provinces on their grievances. She’s now being tasked with nothing less than remaking the country’s socio-economic architecture.
As she put it in her inaugural news conference, Covid-19 offers “a fabulous opportunity for our country” to craft an “equitable” and “green” recovery. This echoed Trudeau’s own promise “to get through this pandemic in a way that gives everyone a real and fair chance at success, not just the wealthiest 1%.”
That’s a refrain increasingly heard all over the globe as the pandemic accelerates a surge in income inequality that began decades ago. For Freeland, it has long been a source of great concern. In 2012, she penned “Plutocrats,” a book that examines the growing divide between rich and poor and helped put her on Trudeau’s radar.
Making her vision a reality will mean using her consensus-building skills to parry resistance from business, provincial governments and a wing of the Liberal caucus that’s wary of huge deficits.
Parliamentary Reset
“She’s got a tough few months ahead of her but she brings a lot of good things to the table and I don’t think you can question her commitment and her fortitude,” said Scott Clark, a former senior official in Canada’s finance department.
Her first announcement as finance chief was a C$37 billion ($28 billion) package in the works before she took over to help the jobless and people who can’t work because they’re caring for family members whose lives have been disrupted by Covid-19. The government will unveil the next elements of its agenda in a Sept. 23 speech to open a new session of parliament.
Freeland showed her grit in the contentious renegotiation of the North American trade deal. The stakes were huge: Canada sends about three-quarters of its exports to the U.S. But the final deal was seen as a victory for her, with Canada making mostly minor concessions to Trump.
The trade scuffle established Freeland as Trudeau’s most reliable minister and made her a logical choice when the prime minister fell out with Bill Morneau, who resigned last Monday after tensions between the two broke into the open.
Morneau, as one of the most fiscally conservative members of Trudeau’s cabinet, fought at times against a prime minister’s office that was preoccupied with announcing Covid-19 financial aid as quickly as possible, sometimes with little economic analysis. Trudeau’s government is on track to run a record budget deficit of about C$343 billion this year – 16% of gross domestic product. It could go even higher, potentially exceeding the 18% gap expected in the U.S.
It’s a major expansion of the federal government along the lines of the one overseen by Trudeau’s father, Pierre Elliott Trudeau, who increased program spending and deficits in the early 1980s to combat a recession.
Morneau’s departure and Freeland’s appointment indicates “a damn-the-torpedoes, full-steam-ahead fiscal policy response,” according to David Rosenberg, founder and chief economist of Rosenberg Research & Associates Inc. in Toronto.
The era of heavy borrowing won’t end quickly, Rosenberg said in an interview. “Anybody who thinks we will grow out of these deficits has to get off the tequila pretty quickly.”
Freeland is a more natural frontwoman for a government focused on inequality than Morneau, a wealthy former executive whose wife is part of the family that controls Canada’s C$10 billion McCain Foods Ltd. empire.
“We are living in an age of surging income inequality, particularly between those at the very top and everyone else,” she said in a speech in 2013, about five months before winning a seat in the House of Commons for Trudeau’s party, which was then in opposition.
“The dystopia that worries me is a universe in which a few geniuses invent Google and its ilk and the rest of us are employed giving them massages.”
Freeland, while not ultra-wealthy, has been part of that same globe-trotting elite since her career as an editor at the Reuters news service and the Financial Times. Her book’s acknowledgments include Eric Schmidt, George Soros, Jeff Immelt, and David Rubenstein on a list of people who “helped me to understand their world and some have become friends.”
A senior official in Trudeau’s government described Freeland as the intellectual muscle behind policy decisions to tackle inequality. She supports Trudeau’s vision of using the Covid-19 economic recovery plan as a vehicle for more reforms to help close a widening income gap, said the aide, who asked not to be named.
But it’s Freeland’s political skill, more than her ideology, that landed her the most difficult job in Canadian politics.
She has garnered a reputation as an effective problem solver who listens. An important part of her toolbox is using her charisma to disarm opponents and the media, as she did throughout more than a year of tough Nafta talks. That will be important in a role that inevitably involves making enemies within the government and the bureaucracy – something she has largely avoided doing so far.
Ever since a debt scare in the early 1990s, Canada’s major parties have been aligned in favor of limited deficits and modest borrowing. It’s one of only two Group of Seven countries to retain a AAA assessment from S&P Global Ratings.
But Covid-19 has shattered that political consensus as Canada follows the global trend of governments borrowing to stimulus their economies because of the shock of the pandemic.
The question is what combination of policies Freeland and Trudeau will focus on. One line of thinking says they will go for large-scale investment in renewable energy and other green initiatives, selling it as a job-creation package that can help Canada get past its reliance on exporting oil and gas.
Provincial governments, however, will balk at any attempts to move into their jurisdiction on social programs. And many Liberals are uncomfortable with so much red ink.
Business leaders, whose relations with the Trudeau government have been fraught for years, also worry the government’s recovery plan won’t give serious attention to fixing the nation’s long-term competitiveness problem.
“People know this money has to be paid back and the best social program is a job,” said Goldy Hyder, president and chief executive officer of the Business Council of Canada.
https://www.bloomberg.com/news/articles/2020-08-27/trudeau-envoy-hopeful-on-detainees-despite-china-vaccine-woes
Trudeau Minister Stays Hopeful on Detainees, Plays Down China Vaccine Woes
https://outline.com/dyDTUc
Justin Trudeau’s top diplomat downplayed any political link to the potential collapse of a partnership between Canada and a Chinese company on a coronavirus vaccine.
Chinese customs hasn’t approved shipments of a drug developed by Tianjin-based CanSino Biologics Inc. for testing in Canada, according to the National Research Council, and the government agency will turn its focus to other partners as a result.
That failure wasn’t “necessarily” tied to the bitter feud with Beijing that erupted with Canada’s arrest of a top Chinese executive on a U.S. extradition request in 2018, Foreign Minister Francois-Philippe Champagne said Thursday.
China detained two Canadians and halted billions of dollars of agricultural imports in the weeks that followed, souring the Trudeau government’s ties with the nation’s second-largest trading partner.
“We are going through a difficult time,” Champagne told reporters on a teleconference from Beirut, detailing his efforts to press for the release of the Canadians as the extradition case against Huawei Technologies Co.’s chief financial officer proceeds in Vancouver. “I would not necessarily make a link between that discussion and the Canadian or the Chinese position when it comes to working on global health.”
While CanSino issued a statement Thursday saying its partnership with Canada “has not been terminated,” the National Research Council appears fed up with bureaucratic delays.
In an email Wednesday, the agency said the Chinese government introduced changes regarding the export of vaccines after the partnership agreement was reviewed and signed. “The process is not clear to the NRC,” it said. “We have no indication of when or if this will occur.”
Champagne also said he was hopeful of progress on the detained Canadians after what he described as a “robust discussion” with Chinese Foreign Minister Wang Yi this week in Rome. The 90-minute meeting Tuesday evening, which was not previously scheduled, came together with the help of the Italian government.
“I’m cautiously optimistic that our voice has been heard, and I’m looking forward to improvement on the consular side,” Champagne said.
https://www.reuters.com/article/us-belarus-election-eu-idUSKBN25N1MN
EU mulls Belarus sanctions as opposition calls for Merkel's aid
BERLIN (Reuters) - European Union foreign ministers on Thursday sought sanctions against Belarus to pressure President Alexander Lukashenko to hold new elections as the country’s opposition appealed to German Chancellor Angela Merkel for help.
Eager to support mass protests against Lukashenko’s 26-year iron rule, EU ministers are considering travel bans and asset freezes on up to 20 people responsible for a crackdown on demonstrators two weeks after an election they say was rigged.
“The announcement of sanctions has not led to any change in behaviour in Belarus,” German Foreign Minister Heiko Maas told reporters, referring to the threat of sanctions made by EU governments after the disputed Aug. 9 election.
The EU, which has an arms embargo on Belarus, eased in 2015 economic sanctions on Belarus that were first imposed in 2004, seeking better relations with Lukashenko, but now hopes to move quickly to reintroduce so-called restrictive measures.
Romanian Foreign Minister Bogdan Aurescu said they should be imposed on officials who helped rig the election, those who ordered the crackdown and those accused of violence against demonstrators. Minsk authorities deny that the election outcome, which handed Lukashenko 80% of the vote, was rigged.
Lukashenko himself is not expected to be sanctioned at this stage.
“The discussion will be important because the level of sanctions, whom to sanction, has to be something that is fully considered,” EU foreign policy chief Josep Borrell, who is chairing the Berlin meeting, said, referring to concerns that sanctions can be challenged in court if not properly prepared.
Belarus is the ally closest to Russia of all former Sovietrepublics, and Lukashenko’s fate lies in the handsof the Kremlin, which must decide whether to stick with him ashis authority has ebbed.
Opposition presidential candidate Sviatlana Tsikhanouskaya, 37, who fled to Lithuania after the election her supporters say she won, appealed to Germany’s chancellor to mediate a solution.
Merkel could “contact Lukashenko directly or explain the situation from her point of view to the Russian president”, she told the German newspaper Die Welt.
>Bette Midler Admits She Was Wrong for Mocking Melania Trump
https://twitter.com/BetteMidler
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>16 other gunshots that ring out during this time
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