Changing the prime minister won’t do much to bump Toronto stocks. The TSX romped ahead 18.5% in the past twelve months. During that time the federal Libs sank like a stoner. The finance ministress quit in a dramatic huff. The deficit blew up. The economy flatlined. Unemployment swelled. Rates fell. Oil prices dropped. House prices didn’t.
Through it all, corps continued to make bank. Stocks went up here, as in the States. Sensible portfolios earned giddy gains while GIC people withered and sulked.
In any case, politics was a sideshow. Trudeau didn’t matter much. But that’s about to change. Given what’s happened south of the border in the last seven weeks, who leads the country may have a discernible impact on our markets and personal finances.
In case you missed it, Liberal MP caucuses in Atlantic Canada, Ontario and now Quebec have asked the boss to quit. Donors are fewer. Defenders are gone. After ten years, it’s over.
The federal Liberals, says pollster Angus Reid, sit at 16% support.
What does that mean? Well, I happen to know intimately what the consequences of sixteen per cent are.
Back in the Analogue Age the majority Conservative government of Brian Mulroney (of which I was a cog) brought in the GST to help shore up national finances and replace a crappy, outdated hidden tax with a visible one. It was immensely, bitterly, wholly unpopular. The oppo guys cried ‘Axe the Tax’ as Mulroney quit to make way for a new leader.
The election of 1993 yielded 16.04% support for the Conservatives. PM Kim Campbell lost her own riding (as did I). The party went from 156 seats to two. Yes, 2. The Chretien Liberals swept into office with 41% of the vote, and a lot of Conservative support drifted to the Reform Party which would eventually morph into today’s Poilievre Cons.
The point is this: support at 16% spread across all the ridings in the country means that in precious few can there be enough clustered to elect a member. Unless things change – unlikely – the Liberals will be where the PCs sat thirty-two years ago.
Trudeau critics will cheer, but none of this is going to happen soon, smoothly, or devoid of consequences.
The PM will quit, guaranteed. He may appoint an interim leader, suspend Parliament and call for a leadership contest. That would take three months, yield a new person at the helm, and delay an election being called until business resumed in Ottawa. That electoral campaign would take between 36 and 50 days (by law). So, a vote in June. Maybe.
Until then, in order to prevent the government being toppled immediately, the House of Commons would be empty. It’s all perfectly legal within our system. But as we all know, on January 20th everything changes. For worse.
The ascendancy of Donald Trump to the White House (they had to paint it white after we torched it on August 24th, 1814) is expected to come with anti-Canadian sentiment. He vowed a 25% tariff on our goods, and has not moderated that position. He’s made a point of taunting we little beavers and mocking the prime minister. Trump is an America-first guy, which means protectionist trade policies and a more isolationist world stance. Plus, he is now surrounded by surreal people, like Kennedy, Musk and the hottie running all those spy agencies.
The conclusion? Anything can happen. None of it good. And we’ll have a wounded, ineffectual head of state that Trump disrespects. Canada may be in the midst of an election within a month or two, but more likely we’ll be on hold while the current governing party tries to save its ass. The damage possible between two weeks from now and the summer is unknown. But it appears there will be some.
Don’t be surprised. Just hope young Pierre has a plan. Like, soon.
About the picture: “Ashley is my neighbor’s dog,” writes KIm. “She has the cutest wiggle, she looks wise and does the playing dead trick to perfection! I love seeing he face, it makes my day to take he out for a walk. After have some rough play on the grass, which usually has me ending up with little puncture bruises on my arms. Thank you Garth for doing all you do, it made my life a lot easier and gave me more dog-time!”
To be in touch or send a picture of your beast, emeil to ‘[email protected]’.
