Mark Carney, and the return of the progressive conservative
As Prime Minister Mark Carney announced a massive and immediate boost to defence spending earlier this month, he talked about the importance of using those new funds prudently.
“Every taxpayer dollar is precious,” he said in passing, later adding that his government would not be looking for new sources of revenue to pay for the defence buildup. “We just cut taxes, we’re not raising taxes.”
It’s easy enough to imagine a Conservative prime minister uttering similar sentiments – much easier than, say, envisioning former prime minister Justin Trudeau waxing on about the need to pinch pennies in the federal budget and making a no-new-taxes pledge.
That Mr. Carney was going to drag the Liberal Party back to the centre after years of an NDP-lite government under Mr. Trudeau was to be expected. Two months after the election, the extent of that metamorphosis is becoming clearer – and it is remarkable.
Part of that change is atmospheric. There are no more breathless lectures from Mr. Trudeau; they have been, mercifully, replaced by Mr. Carney’s boardroom staccato. Unlike his predecessor, the current Prime Minister boasts of being “laser-focused” on economic growth. And Canadians, happily, have no idea what kind of socks Mr. Carney likes to wear.
But more than mannerisms have changed. Since April, the Prime Minister has cut personal income taxes, boosted defence spending dramatically, pledged to cut the cost of the federal bureaucracy, tightened immigration rules, eliminated federal barriers to internal trade, created a framework for breaking the stasis on big national projects and signaled that he will dismiss underperforming top bureaucrats.
That’s an agenda that Brian Mulroney could have endorsed. In fact, it overlaps a good deal with the actual governing record of his Progressive Conservatives. Mr. Carney is a Liberal but, in the early going, he looks to be governing much like a Red Tory – a progressive kind of conservative.
Mr. Carney’s agenda is one that the Liberals, in their Trudeau-era incarnation, would have most likely loudly denounced. Indeed, some left-leaning Liberals in the current caucus, including former cabinet minister and leadership contender Karina Gould, have already voiced their disquiet on legislation to speed up megaproject approvals.
That could portend problems not that far down the road for the Liberal coalition that gave Mr. Carney his minority government. The Liberals corralled the progressive vote, with support for the NDP and Greens plummeting from the 2021 campaign. Will those voters stick with the Liberals if Mr. Carney continues his rightward sidestep? And will Mr. Carney stick with his agenda if his progressive supporters bolt?
Another (large) caveat is how Mr. Carney’s agenda adds up in the fall budget. Broad statements on finding efficiencies in the public service are enough for now. Canadians will see in a couple of months whether the blue-tinged Liberals will actually reduce the bloated head count of civil servants.
Similarly, it’s encouraging that Michael Sabia, two days before he was appointed Clerk of the Privy Council, mused about the “ pancake” of regulations that were stifling economic growth. But what will he and Mr. Carney do to reduce the height of the pancake stack?
Biggest of all, the swirl of mist surrounding Mr. Carney’s fiscal plans will be necessarily dissipated once that budget is tabled. How will the defence buildup be paid for? Will the deficit fall or rise from the groaningly high levels that Mr. Trudeau bequeathed to his successor? The answers found in the budget will determine if Mr. Carney has truly broken from the fiscal recklessness of the Trudeau Liberals.
Longer term, there is the open question of how aggressively the Carney Liberals will push badly overdue structural reforms of the economy. Broad tax reform, lowering of foreign ownership barriers, radically paring business subsidies and reducing the regulatory burden: all of those changes are needed to reinvigorate Canada’s economy.
At the moment, Mr. Carney doesn’t look to be abandoning the dirigiste propensities of the Trudeau Liberals, who were unable to see that millions of minds in the private sector might do a better job than a government department.
In less than four months, Mr. Carney has reinvented and reinvigorated the Liberal brand, delivering a progressive feel to conservative governance. Canadians will find out soon enough if that is a mere marketing exercise.
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