Last week’s elections for the European Parliament showed that the political pendulum in the Western world continued to swing right generally, with populist or conservative candidates gaining across the board and scoring high profile wins in Italy and the United Kingdom.
Recent polls show that this trend is likely to continue to play out in Canada, which has elections in October. For instance, a poll by the Angus Reid Institute earlier this month indicated that Justin Trudeau, the current Prime Minister and leader of the Liberal Party, trails Andrew Scheer of the Conservative Party by 13 points.
Part of the Liberal Party’s problem is economic frustration. While the US economy continues to set records of broad-based prosperity, Canada’s economy has improved but at a much slower pace. For instance, the US unemployment is at a record low of 3.6%. Canada’s unemployment rate is a still-discouraging 5.7%.
And Canada’s economic improvement has been remarkably patchy. The service sector of the economy has been a leader, while the traditional Canadian stalwarts of manufacturing, construction, energy and raw materials have lagged.
Canada’s oil patch has been locked in a cycle of depression and groaning mini-recovery for several years now. On April 16, Bloomberg reported the vacancy rate for office space in Calgary was 25.23%, down from the peak of 27.8% last spring but still eye-popping. The official off-payroll unemployment rate in Alberta is 7.3%, with the underemployment rate of the self-employed well into the double digits.
Meanwhile, just across the southern border and working many of the same geological fields, the US energy sector has become the dominant player in the world market, with pay gains in the US oil patch continuing to make headlines.
In the eyes of many Canadians, this disparity is partly due to lack of effective and caring government. For instance, one hot button issue is that Canadian pipeline capacity is indisputably inadequate and there has been a lack of leadership to provide practical solutions on this issue of basic infrastructure. Even agreed-on improvements seem perpetually postponed.
Further, Prime Minister Trudeau has demonstrated an affinity for old-fashioned crony capitalism and imperious political bossing that has resulted in bad behavior with respect to certain issues that have blossomed into full-blown national scandals.
The eye of the scandal-hurricane is SNC-Lavalin, a large Quebec-based engineering firm with deep ties to government. To set the scene, SNC-Lavin is based in Quebec, it employs 3,400 people and its largest investor is the Quebec public employees’ pension fund, with a 20 percent stake. The Chairman of the company was a former head of the Canadian civil service. Justin Trudeau is the scion of a prominent French-Canadian family (the son of former Prime Minister Pierre Trudeau) with deep roots in the Province of Quebec.
SNC-Lavalin was recently prosecuted and found guilty by the Canadian government of having illegally paid bribes to the family of former Libyan dictator Muammar Qaddafi to secure lucrative contracts in Libya.
Facing tough penalties that would reverberate to the equity stake of the Quebec public- employees union, the company and majority shareholder commenced a lobbying campaign within the Liberal Party for lenient treatment.
The long story made short is that the Prime Minister attempted to pressure law enforcement to go easy on the company. However, the acting federal attorney general at the time, Jody Wilson-Raybould, refused to comply with the unlawful directives and was promptly sacked and demoted. She resigned from the government four days later. Another cabinet official, Jane Philpott, resigned in solidarity with Wilson-Raybould.
The loss of two female cabinet officials over ethical issues was a staggering combination of punches to the Trudeau image of the modernist and high-minded progressive.
Making matters worse, Trudeau threatened a libel suit against his Conservative opponent Andrew Scheer with respect to accusations of lying about the SNC-Lavin scandal. A few days later Trudeau, in the House of Commons, fessed up to telling the lie in question. The Trudeau campaign then added insult to their self-inflicted injury by accusing the Scheer campaign of focusing on Trudeau’s libel threat when they should be focused on their constituents.
The comedy in this last bit of floundering has not been lost on commentators. The polls indicate that likely voters are more disappointed than amused.