So Mark Carney won in Canada. On the one hand, I’m very glad. Carney articulated a message of unity and solidarity against President Donald Trump’s attacks on Canada’s sovereignty and trade. Carney seems the best person to deal with this unprecedented situation. And, of course, I see Pierre Polievre as a cynical YouTube agitator –certainly not a unifying leader– and I’m very glad that he’s not going to be Prime Minister. At least, not yet.
On the other hand, the disturbing trend that started in Europe, spread to America, and is now present in the Canadian poll numbers is that working-class, blue-collar men are continuing to abandon the left and center and are moving to the right. This isn’t new to Canada and has been a concerning trend for the last couple of elections, but Polievre’s success in courting male voters, who had, traditionally, at least, been central to the left-wing New Democratic Party with their union cards and concerns over affordability. This re-orientation is a serious problem. And it augurs poorly for the Liberals in the future. If they don’t get real things done, they face a wipeout when things go back to normal, and progressive women and older folks don’t feel they have any choice but to support a central banker who can take on Trump.
The problems Canada faces are massive. Carney faces a shrinking economy, a hideously poor productivity rate, and a huge debt and deficit problem. Alberta and Saskatchewan are being pulled into an American cultural orbit of misinformation and extremism by provincial politicians all too willing to lie to them. On paper, Carney’s profile as central bank leader of two G7 economies and reportedly as a shrewd and demanding manager fits many of these problems. He likely has the gravitas and reputation to ensure that the bond vigilantes give him space to maneuver, get creative, innovate, and invest. He’s from Alberta and has spoken highly of the need for oil and gas energy as a part of Canada’s future. That’s a good start — oil and gas need to be part of Canada’s climate change solution if the goal is to keep the country together while greening its economy.
I am worried that Mark Carney is another Timothy Geithner.
Geithner, a former Goldman Sachs banker, was the Treasury Secretary under President Obama and headed the U.S. Treasury Department in the aftermath of the global financial crisis. Geithner was an insider, an institutionalist, and –deep down– a conservative. When presented with an existential threat to the economy, his instincts were to protect his banker friends and sell out working and middle-class families.
Geithner mistakenly identified more neoliberalism as a cure for a crisis created by neoliberalism; it only worsened things. Carney needs to learn from that mistake. The costs of Geithner’s paralysis and myopia are still being felt in American politics; indeed, the Trump crisis is all part of the aftermath of Geithner and President Obama’s fear of implementing radical change.
Geithner could have been bold. He could have helped American families keep their homes, pushed for real regulation of Wall Street, and invested in American education and infrastructure. He didn’t, and right-wing populism is the infection that filled the gash in Americans’ belief in their elites and their government.
Carney needs to be bold. He must assemble a coalition beyond his own party and include the provinces while rejecting the rhetorical extremes of the Green Party, the Bloc Québécois, and the NDP to defend democracy against the YouTube conservatism of Pierre Polievre. In order to do so, he needs to make at least a good-faith attempt at peace with Western energy interests. He must raise taxes on corporations and high-income individuals, close tax loopholes, and reduce taxes for most consumers. He should borrow money to invest in infrastructure and green initiatives. He needs to shrink the federal bureaucracy and cut its embarrassing over-use of outside consultants; in short, he must reject the short on delivery and high on virtue-signalling characteristic of Justin Trudeau’s Liberal Party.
This will all require a willingness to take on entrenched interests on Bay Street in Toronto, on Wall Street, and in board rooms. Carney will have to be a “traitor to his class.” It’ll need political finesse too. Balancing a minority government while making these changes will be a tall order. But it is worth remembering that the populist who occupied the White House before Donald Trump was not Andrew Jackson; it was Franklin Roosevelt. In many ways, only a wealthy old elite like him could make the massive changes America needed in the depths of the Great Depression. FDR combined political skill, a willingness to listen to his team, and his role as an elite to create a new political order in his country.
Mark Carney is in the position to do the same. I hope he learns politics as fast as he’s learning French and that he’s more like FDR than Tim Geithner. That’s what Canada needs.
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