Originally published in The Breach. Article by Martin Lukacs & Nikolas Barry-Shaw
Mark Carney can apparently do no wrong. Scroll through comments on news articles, and you’ll encounter an energetic online army defending the prime minister’s every action.
Cancelling a tax on the world’s most profitable tech giants? A genius chess move in his trade war against Trump.
Advocating for new pipelines while the country burns from climate change-fuelled wildfires? A tough decision to shore up Canadian sovereignty.
Boosting spending on the military to record and wasteful levels? A responsible counter to supposed perils like Russia or North Korea.
Expanding surveillance powers to crackdown on refugee rights? Well, at least he’s not Conservative leader Pierre Poilievre.
The U.S. President’s tariffs and threats have left Canadians anxious and disoriented, giving Carney an opportunity to move fast and with far too little scrutiny. He’s pushing through pro-corporate policies that go beyond anything he outlined on the campaign trail. The agenda is so right-wing, in fact, The Globe and Mail last week gleefully noted that “Brian Mulroney could have endorsed it.”
Yet denialism is widespread. It makes some psychological sense: many are still rationalizing their choice in the last federal election. Millions of progressive Canadians parked their vote with Liberals, after the establishment media manufactured an image of Carney as a saviour against Trump. Even though the prime minister is now unravelling that hope in a hurry, it’s hard to accept the betrayal.
Carney’s latest move, however, will be more difficult to explain away. This week, he instructed his ministers to find tens of billions in cuts to “the day-to-day running of government.” That will reduce spending in the public service by an astonishing 15 per cent over the next three years—the “worst cuts in modern history,” according to economist David Macdonald. “For cuts this deep,” he writes, “it would require across-the-board job losses and major service reductions.” If you’ve had frustrations with federal public services, it’s about to get a whole lot worse.
This is one way Carney is choosing to pay for his big ticket items: personal income tax cuts that mostly benefit the richest Canadians, and financing the biggest expansion of military spending since World War II. His recent promises to meet NATO’s ballooning target—intended to placate Donald Trump—means Canada could eventually spend $150 billion a year on the military. Even his existing plans will already require $10 to $20 billion more in military spending, with each dollar squandered on a warship or fighter jet or bomb being a dollar less spent on far more pressing social and economic needs.
Even Carney has convolutedly acknowledged this trade-off and rip-off: “If we are moving to the higher and higher levels of defence spending because that’s necessary, then we will have to make considerations about what less the federal government can do in certain cases, and how…we’re going to pay for it.” And while Trump appears unappeasable—yet again threatening elevated tariffs on Canada this week—the weapons and corporate lobbies in this country are cheering.
It’s scarcely possible to pass all this off as clever Trump whispering. What it more accurately underlines is a long-standing pattern in Canadian politics: Liberals so often advance a right-wing economic agenda of cuts and downsizing of public services beyond the wildest dreams of Conservatives. The cuts that Carney is proposing exceed what was done by Conservative Prime Minister Stephen Harper, who downsized the public service by 10 per cent. It harkens back to Jean Chrétien‘s Liberal government, which cut 18.9 per cent between 1994 and 1998. (Though unlike Carney, both Chrétien and Harper at least cut back military spending.)
“The Liberals were not perceived as black-hearted accountants,” the most senior civil servant noted of Chrétien‘s government of the time. “They were perceived to believe in government.” This gave them a unique ability to radically diminish the government’s role in regulating big business—and improving our lives. Many of the economic and ecological problems we confront today—the obscene scale of inequality, the deterioration of health care, a dire lack of non-market housing, the planet-wrecking boom in the Alberta tar sands, and a welfare state that is now among the stingiest in the industrialized world—can be directly traced back to the Liberal cuts, downsizing, and privatization in that era.
There’s another element of deja vu. To justify his neoliberal revolution, Chrétien leveraged widespread fears about how Canada was about to hit a supposed debt wall—a fake crisis that had been ginned up by the corporate lobby and the establishment media as a pretext for cutting government down to size. Carney by constraint is dealing with a real crisis, a tariff war imposed by Trump. But all the same, this Liberal government is exploiting it to push through policies the corporate elite have long coveted—gutting environmental and labour regulations and anything that stands in the way of more corporate profits—and which the population wouldn’t tolerate in any other circumstances.
The austerity being tabled now is likely only a taste of what’s to come. For all of Carney’s insistence that the government will not touch transfers to provinces—which fund health care, education, social assistance, and much else—the scale of new military spending will require even deeper cuts to make up the difference. Carney’s admission that he will merely “maintain” these transfers may offer a clue: refusing to increase them in line with inflation and population growth will simply be a cut by other means.
It’s no wonder that Carney is trying to push through his agenda as fast as possible, while Canadians remain disoriented. The prime minister’s newly-appointed top senior civil servant, Michael Sabia, is clear about this Canadian-style shock doctrine: “windows of opportunity open and close,” he wrote in a letter to civil servants on Monday. Sabia would be one to know: once upon a time he helped none other than Brian Mulroney privatize a rash of Crown corporations. Carney has even openly signalled he’s preparing to purge any civil servants who don’t get in line (with “high-level talk of recruiting other business achievers” to replace them).
We need to drop the Carney denialism in a hurry, and get angry instead. The prime minister, a consummate technocrat who knows how to cater to elite interests, is taking Canadians for a ride, while servicing his natural constituency: bankers, tech broligarchs, oil barons, and arms manufacturers. It’s time we open our eyes, clue in to what’s happening, follow the money—and put up a fight.
Nikolas Barry-Shaw
Nikolas is the Trade and Privatization Campaigner for the Council of Canadians and author of the book “Paved with Good Intentions.”
