What will the Canadian economy look like after the pandemic? (There will be an “after” the pandemic, someday.) It’s a question we may as well turn our minds to since, for the vast majority of us, there’s relatively little to do right now — until Tuesday, that is, when some stores will be allowed to reopen, but just a little.
Prime Minister Justin Trudeau’s answer, glimpsed in bits and pieces throughout his press conferences over the last weeks and months, is that we won’t be going back to business as usual. The PM is willing to bail out large corporations that are suffering in the pandemic, but he said this week that they’ll have to share their “complete financial structure” with Ottawa (potentially in so doing illuminating some financial subsidiaries they’d prefer remain obscured.) On top of that, corporations will have to show how they’re going to help fight climate change.
Meanwhile, the Ontario 360 project (from the Munk School of Global Affairs and Public Policy at the University of Toronto) is urging Premier Doug Ford to use the crisis to make major broad-ranging changes to fundamental elements of Ontario’s public spending and other policies. Lower taxes and spending restraint are the order of the day, to help juice the province’s economy.
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The common thread here is that, both federally and provincially, the priorities for government after the pandemic are going to look a lot like their priorities before the pandemic — just more so. Trudeau might not have been terribly energetic on the matter of dark money hiding in offshore bank accounts before COVID-19, but he was hardly silent about it (or climate change). Ford, for his part, has spent much of the last two years trying to constrain government spending and improve the province’s economic competitiveness. Before COVID-19 hit, his biggest problem was that the promise he’d been elected on — limiting government spending without introducing painful, unpopular service cuts — turned out to be arithmetically impossible, and his 2019 budget was so toxic it cost his finance minister his job. But no matter: on the far side of the pandemic, we’ll get back to reinventing the province in a leaner image.
Some people find this all distasteful: surely, the argument goes, the objective of government is to get us “back to normal” and not use the crisis as an excuse to engage in social engineering. This argument can be seen on both sides of the political spectrum: I’m old enough to remember when the left believed that their antagonists on the right were uniquely prone to using “the Shock Doctrine” (as author Naomi Klein phrased it) to impose their policies on unwilling populations. Now it’s the right, horrified by examples such as the United States, where even a milquetoast Democrat like Joe Biden is publicly musing about expanding the government to an extent no other president has since Franklin Delano Roosevelt.
Allow me to propose that this is, in fact, all basically normal. Government is political: decisions about how to spend billions (or, in contemporary sums, tens of billions) of dollars will always involve winners and losers, and different political coalitions are always going to allocate wins and losses differently. There was a brief mania in the last decade for trying to “take the politics out of transit,” on the theory that planning experts should be making massive public-policy decisions without interference from elected officials. It was never taken very seriously, even by its nominal proponents (I’ve said my piece about the Ontario Liberals’ relationship to Metrolinx), and now Doug Ford has largely abandoned even the pretense.
This, at least, has the virtue of honesty, and it’s worth being honest about COVID-19 recovery efforts: Trudeau’s plans are going to be different from Ford’s because they believe very different things. That’s what it means when voters support two different parties at two levels of government. We can argue over who’s right, or we could spare ourselves the effort (aren’t we all exhausted?) and just concede that partisans are going to support their parties.
If you were a small-government conservative before the pandemic, Trudeau’s response will upset you; if you were a socialist before Ontario’s first coronavirus case, I regret to inform you that Doug Ford will not be leading the people in glorious revolution.
The hitch in all this is that Canadian federalism is not balanced, and Ottawa doesn’t hold the whip hand you might think given the much larger sums it can spend. The provinces have enormous power to shape their regional economies in the recovery; Ontario has already started on that work. Major decisions related to infrastructure spending, business regulation, and social services will be made exclusively by the provinces. And, if Ottawa does want to introduce some major new spending program, post-pandemic, it will at least need to consult with the provinces first. Most (including Alberta, Ontario, and Quebec) are governed by conservative parties.
So, thanks to the last few years of turnover in provincial legislatures, the decisions made directly by provinces will mostly be made by conservative premiers — and those same conservative premiers will have enormous power to shape and constrain the federal response. Elections matter, not least because it’s impossible to predict what will happen between them.