It’s not clear yet whether the 30-day delay announced by Donald Trump on his promised tariffs on Canada is a stay of economic execution or merely its postponement. The pause will give Canadian leaders time to negotiate what Trump has called a “final economic deal,” and they should use the time to figure out how best to flatter, cajole, and otherwise convince Trump that Canada is not, in fact, a threat. They should also use it to prepare for the new reality in which America very much is a threat to us. 

That almost certainly means more military and defence spending, along with the elimination of interprovincial trade barriers and the deepening of economic relationships with Europe, China, and the rest of the world. It definitely means a renewed interest in building oil and gas export pipelines on the part of people who have always been interested in it, although it remains to be seen whether they can actually convince anyone who wasn’t already in their camp. 

Most of all, though, it means a strong federal government, one that’s capable of successfully advancing national initiatives. Unfortunately, we don’t have one of those right now. That’s not just because parliament is prorogued or the Liberals are trailing badly in the polls. It’s because for years — decades, really — our prime ministers have been ceding ground and authority to the provinces. Yes, the current government has bucked that trend when it comes to greenhouse gas emissions, and invited all manner of pushback from provinces like Alberta and Quebec in the process. But on almost every other issue, from healthcare funding to minority rights and the constitution, it’s been one “strategic” retreat after another. 

The Charter of Rights and Freedoms’ notwithstanding clause, for example, has been invoked eight times by provincial governments in the last five years. The reason why you might not know this is because the federal government has barely made a peep about it, especially when the government doing it is in Quebec. Last year, Saskatchewan’s government instructed its provincial energy utility not to collect the carbon tax on natural gas — and, for all intents and purposes, break the law. Here again, the federal government was effectively mute. 

The Harper government wasn’t any better. It sold off the Canadian Wheat Board, gutted the long-form census and other key data collection exercises at Statistics Canada, and cut the GST by two points in order to reduce the federal government’s available fiscal capacity. His overarching vision of so-called “open federalism” eschewed the idea of national priorities and standards, especially in areas of social policymaking. 

The last truly strong federal government might be the one led by Jean Chretien in 2000 — the same one that had the courage and clarity to keep us out of America’s misadventure in Iraq. If Canada is going to resist the gravitational pull of Trumpism, a force that will exist long after its namesake is gone, we won’t do it as a loose coalition of regional interests. We will have to invest our federal government, regardless of who’s leading it, with the sort of power and authority that is capable of pursuing national objectives — and overriding provincial objections. 

That could mean creating a national energy program for the 21st century, one that better connects our provincial electricity grids, supports the development of resources like uranium and critical minerals, and builds out massive amounts of low-cost clean electricity. That could mean major new investments in our military resilience to make us better able to address both the threats posed by potentially hostile activity in the Arctic and growing risks of wildfires and other climate-driven disasters. And it almost certainly means tax increases — perhaps restoring the GST to seven per cent, for starters — that help pay for these priorities. 

It won’t be easy. It might not even be possible. The issue of interprovincial trade barriers offers an object lesson here. As Internal Trade Minister Anita Anand said recently, clearing these away “could lower prices by up to 15 per cent, boost productivity by up to seven per cent and add up to $200 billion to the domestic economy." Low-hanging fruit, right? 

The federal government actually tried to pick that fruit in 2017 when it and every province and territory signed the Canadian Free Trade Agreement. That deal created a binding dispute resolution mechanism that could, in theory, eliminate much of the regulatory misalignment and lack of national standardization that constitute most of our internal trade barriers. Unfortunately, those provinces also negotiated 245 different exemptions, a few of which make sense (language laws, for example) but most merely protect existing provincial fiefdoms: controlling who can own grazing land or who can harvest wild rice, for example. If Ottawa can’t break through this sort of resistance, how can it hope to achieve more pressing (and challenging) national objectives? 

Then again, that was before Trump delivered the biggest collective wakeup call in our history. Thirty days isn’t nearly enough time to change the balance of power between the federal government and the provinces, much less advance the kind of legislation that entails. But it is enough time to get the conversation started, and it’s one that should define our next federal election. 

The carbon tax that Conservatives have been attacking for years suddenly looks like the thinnest of all possible gruels, not least because both Mark Carney and Chrystia Freeland have said they’ll scrap the consumer portion of it. Instead, we all have to consider far more important questions: what does it really mean to put Canada first, and who is best able to do it? 

Danielle Smith might have overplayed her hand

Loyalty, like beauty, is in the eye of the beholder. For many Canadians, Alberta Premier Danielle Smith’s conspicuous campaign to curry favour with Donald Trump — and favourable treatment for the oil and gas industry — was an affront to Canada’s national interests. As one former federal trade negotiator said, “the fact that Alberta has gone in a different direction through these last few weeks has significantly undermined Canada’s position.”

Smith, though, was spinning this rogue diplomacy as an unqualified success even before Trump pushed pause on the promised tariffs. “The sustained diplomatic efforts and advocacy of the Government of Alberta and industry over the last couple of months is a primary reason why Canadian energy including oil, gas, critical minerals, electricity, and uranium received a reduced tariff of 10 per cent,” she said in an op-ed for the National Post that called for — you guessed it — more pipelines. 

In time, though, and maybe not that much of it, this could be a textbook Pyrrhic victory for Alberta’s premier — one that does far more damage to the oil and gas industry than anything this supposedly anti-oil federal government could dream up. There is, first and foremost, the damage it does to her desire to see more pipelines built and more oil and gas produced in Alberta. Her willingness to sacrifice agriculture, forestry, mining and manufacturing sectors may get overlooked in her own province, but the rest of the country will not be nearly as charitable. To them, it will look like Smith went into business for herself at the cost of their own industries, jobs and businesses. 

Why, then, would people in Ontario, Quebec, the Maritimes or British Columbia ever support the new pipelines Smith says are so crucial? If Trump’s tariffs persist and Smith refuses to countenance an export tax on Canadian energy, she will vaporize whatever goodwill there might be right now outside of Alberta toward the idea of new pipeline projects. If anything, she might harden the resolve of those opposed to them, and expand their ranks and reach. 

That’s especially true given the rhetoric being used by some of her closest supporters. “Dear Rest of Canada,” her chief of staff said on social media. “Are you ready to build Energy East and Northern Gateway yet? How about cutting absurd taxes and anti resource development laws to be more competitive? Or are we just going to sit back and listen to this sitting down while wrapped in the flag?”

If Smith and her government actually want to capitalize on this window of opportunity for new infrastructure, they have to put more on the table than just the usual show of petulance and posturing. They could, for example, promise to match any federal investment in a new pipeline on a dollar-for-dollar basis with direct funding for emissions-reducing technology. They could eliminate the anti-renewable energy regulations they’ve imposed. If they really wanted to change people’s minds outside the province they could even embrace the federal government’s emissions cap and start helping industry work towards meeting it. 

That won’t happen, of course. But her province’s never-ending quest for more pipelines isn’t the only potential casualty here. By repeatedly reminding the United States and its MAGA president how much they depend on Alberta’s oil exports, Smith risks giving them a reason to do something about that. In the near term, that might mean a lower tariff on oil exports from Canada. But in the medium and longer ones, it might mean finding ways to replace it entirely, whether that’s with Venezuelan imports or massive subsidies to refineries that allow them to retool and process more American barrels of oil. 

That’s especially true given Trump’s near-pathological obsession with trade deficits. Amid all the talk about fentanyl and immigration and the posturing around turning Canada into the 51st state, it’s his focus on America’s trade deficit with Canada — one driven almost entirely by Alberta’s oil and gas exports — that remains the most consistent. As Rory Johnston, an oil market analyst and Commodity Context newsletter author, told Heatmap’s Robinson Meyer, “I don’t know that anyone has a great sense of where Trump’s true philosophical anchor is, other than that we are now getting a clear picture that he views any and all trade deficits as a sin unto themselves.”

If that’s the case, Smith’s oft-stated goal of doubling oil and gas production will be viewed as a threat, not an opportunity. It’s also one Americans are increasingly able, and willing, to fend off. “Americans, at some level, are convinced that they can spin up a domestic industry in anything they want to,” Canadian political scientist Peter Loewen, who’s now the Harold Tanner Dean of the College of Arts and Sciences at Cornell University, told Paul Wells recently. “They're better at getting stuff done over a 10-year time frame than we are, and they know it.”

This is all ironically reminiscent of the decision by former premier Ralph Klein in 2006 to bring an oilsands mining truck to Washington, D.C. with him for “Alberta week.” By parking the giant truck (at the Smithsonian, of all places), Klein hoped to draw America’s attention to Alberta’s role in supplying their country with oil and gas. Instead, he drew its attention to the environmental mismanagement of the oilsands — and helped paint a giant bullseye on its metaphorical back for U.S. environmental organizations and activists. For all the blame that his successors and federal Conservative colleagues have cast on everyone from Justin Trudeau to Greta Thunberg, it was actually Klein and his hubris that inspired the green movement’s opposition to Alberta’s oilsands. 

Danielle Smith is in the midst of making the same mistake. The only difference is that it won’t be the environmentalists who are the problem. Instead, it will be the very politicians and political movement that she’s trying so hard to curry favour with right now. Yes, trying to replace Canada’s oil exports with domestic production would be ruinously expensive and economically idiotic. But so is the trade war that Trump launched against his two closest neighbours and allies. Does that sound like someone whose rationality we should stake our future on?

The Liberals need to woo young voters. How about some free money? 

A string of recent polls have shown Liberal support bouncing back into the mid-20 per cent range, and maybe — if you believe the EKOS ones — even higher. But so far, at least, they’re still well behind the Conservatives, who remain on track to win the next election. 

If recent trends hold, of course, their lead will continue to shrink. With Mark Carney’s pledge to get rid of the consumer carbon tax, and Donald Trump’s ever-looming presence over our politics, the next election will not look at all like Pierre Poilievre and his team had been hoping. But they still have one area of clear relative strength: young voters. 

If the Liberals want to chip away at that, here’s an idea they might want to consider: a $500,000 lifetime income tax exemption for anyone under the age of 30. It’s a verifiable fact that younger Canadians have it harder than their parents did when it comes to buying a home or even affording shelter in our biggest cities, while the pandemic was a massive disruption to an important stage of their career or education. 

We already grant a lifetime capital gains exemption to small businesses and the people who own them, one that gives them $1.25 million in tax-free gains. This promotes entrepreneurship and risk-taking, and it’s widely viewed as an acceptable use of tax policy. A similar inducement for young people, one that helps them get ahead instead of falling behind, is worth consideration. 

Would this risk juicing the housing market? Maybe. Would it require us to find the lost tax revenue in other places? It would. I’d gently suggest that some form of clawback on OAS for higher-earning seniors, as Generation Squeeze’s Paul Kershaw has suggested, would work nicely here — and raise billions in the process. If affluent Baby Boomers want to pay it forward to younger Canadians? Well, this is the way. 

New Star fades to black 

New Star, a Vancouver-based book publisher that’s been around for many decades — and, full disclosure, published some of dad’s books — has announced that it’s closing its doors. And while the ever-more-challenging business environment for selling books, and especially Canadian books, is part of the reason here, there’s another that deserves our collective attention.

In his letter announcing the decision, New Star publisher Rolf Maurer blamed “the cold wind blowing in New Star’s direction from our arts councils, whose support of our work is a condition of existence.” Apparently, New Star was on the BC Arts Council’s “concerned status” list — funding probation, essentially — for “failure to address the BC Arts Council’s priorities for reconciliation, equity, diversity, inclusion and access.” 

As the Globe and Mail’s Marsha Lederman noted in an excellent piece, “the temptation from this tale might be to conclude: DEI = bad. Yet New Star has been a progressive house, publishing Canadian poetry, fiction, and experimental literature, as well as volumes on Canadian journalism, politics and history.” Apparently, though, it wasn’t progressive enough. 

As Maurer told Lederman, the absence of government support — or even the prospect of losing it — was unsurvivable. “Independent publishers account for about five per cent of the domestic market, whereas 20 years ago that figure was 15 or 20 per cent,” she wrote. “Government support for Canadian publishing is not optional; it’s necessary. Without it, New Star was done.”

It might be tempting for some to dismiss this as a poorly-run business meeting its inevitable end. Indeed, as Maurer told Lederman, “publishing, especially Canadian publishing, has a long and glorified history of not making money.” But at a moment where our cultural sovereignty is being actively questioned by millions of Americans, including its democratically elected president, losing a publisher like New Star is an even bigger problem. 

We need cultural entrepreneurs who help us tell our stories, warts and all. We need people who are willing to fight for Canadian writers, Canadian voices, and Canadian narratives. And we need governments that understand the value of arts and culture can’t always be captured on an accountant's spreadsheet — or a diversity advocate’s checklist. 

We lost one of those cultural entrepreneurs here. If we don’t learn from it, we’ll lose far more than that.