Prime Minister Justin Trudeau took multiple hits over the summer, with two major ones coming just before he faces a Liberal caucus eager to hear how he plans to start adding to the win column.
After meeting with his
Ontario caucus in mid-August and his
Quebec caucus this week, Trudeau will face all of his MPs when they meet next week for a retreat in Nanaimo, B.C.
It’s the first time the entire caucus will meet after the surprise defeat to the Tories in the Toronto–St. Paul’s byelection in early summer.
Had nothing else happened since, the meeting would have likely been focused on taking stock of the defeat and planning to avoid a repeat.
There will be much more to discuss after what took place this week, with the NDP leaving the deal ensuring the Liberals remain in power, and a top party cadre calling it quits.
NDP Leader Jagmeet Singh
announced on Sept. 4 his party was dropping out of the supply and confidence agreement, saying the Liberals were giving in to “corporate greed.” The deal, which had been in place since March 2022, promised to advance a number of legislative items sought by NDP in exchange for supporting the minority government in confidence votes.
The day after, on Sept. 5, Liberal Party national campaign director Jeremy Broadhurst
announced he would step down at the end of the month.
Broadhurst said he remained committed to the party and the prime minister, but noted the job needs someone who can “bring more energy and devotion to the job than I can at this stage of my life.”
Silver Lining
There is a silver lining for Trudeau after this one-two punch. While Broadhurst played a key role, he is replaceable, and so is the NDP.The Bloc Québécois holds more seats than the NDP in the House of Commons, and its leader Yves-François Blanchet said he'd be looking into what he can gain from providing support to Liberals on confidence votes.
“I don’t think Quebecers are so eager to have an election since they know Conservatives are ahead in the rest of Canada, and Quebecers don’t want the Conservatives,” he
told LCN news channel on Sept. 5.
There’s a high likelihood the NDP also doesn’t want a Conservative majority government before October 2025 when it can still extract some gains from the Liberals in exchange for support on key votes.
The NDP is also not high in the polls after over two years of supporting the Liberals, themselves trailing the Tories in voting intention polls by a large margin over an extended period. Another factor the NDP must consider in the near term is its provincial party wings battling for power in elections this October in B.C. and Saskatchewan.
All these factors make the Liberal position more tenable at this time, but the optics of being abandoned by a key partner and key staff is not optimal.
On that front, Trudeau lost his labour minister Seamus O'Regan during the summer after he stepped down citing family reasons.
Another minister could be on his way out. Transport Minister and Trudeau’s Quebec lieutenant Pablo Rodriguez is being
courted to run for the Quebec Liberal Party leadership, and has yet to make public his intentions about leaving federal politics.
Rodriguez is an MP from Montreal and the whole city is currently mostly a Liberal stronghold. Rodriguez and his party will be paying close attention to the Sept. 16 byelection in former Liberal cabinet minister David Lametti’s former riding of LaSalle–Émard–Verdun.
Holding on to this stronghold after losing Toronto–St. Paul’s would be highly welcomed by Trudeau and his team. With the NDP and the Bloc splitting the contender vote, Liberals stand a better chance of keeping the riding than they did in Toronto.
The Economy
Aside from navigating domestic political uncertainty, Trudeau may be hoping the Democrats hang on to the White House after the U.S. presidential election in November.Trudeau previously
said a return of former president and Republican candidate Donald Trump would be a “step back” and the Liberal Party is more politically aligned with the Democratic Party. Ottawa has expressed concerns about Trump’s previous tariffs, but it hasn’t been spared under the Biden administration.
The United States nearly doubled its tariffs on Canadian softwood lumber in August. Another blow to the Canadian economy could come as China is
evaluating retaliating against the canola industry in response to Ottawa imposing 100 percent tariffs on Chinese electric vehicles.
On the larger economic front,
Trudeau and his
ministers have counted as a win the Bank of Canada’s decision to continue lowering its policy rate this week, amid an affordability crunch first caused by high inflation and followed by a response of heightened interest rates to cool it off.
“We were the first G7 country to cut rates in June and July and now the first to cut rates for a third time,”
commented Finance Minister Chrystia Freeland on Sept. 4. “This is welcome relief for so many Canadians and shows that our economic plan is working.”
Meanwhile, as the economy slows in reaction to higher rates, unemployment
rose to 6.6 percent last month.
Royal Bank of Canada pointed out in a Sept. 6
note to clients the unemployment rate is now 1.8 percent higher than during post-pandemic lows and over 1 percent higher than a year ago. “Canadian labour markets continue to soften,” said the bank’s assistant chief economist Nathan Janzen.
Higher unemployment amid rapid population growth could spell additional trouble for the Liberals as they seek to energize the economy and their political fortunes.
