Canadian Prime Minister Justin Trudeau is on the way out as Canadian Prime Minister one way or the other. The only question is: When?
Canada will hold an election sometime between now and next October as the Federal government’s term runs out and if Trudeau leads the Liberals into that vote he will be decimated. The polls show the Liberals trailing the Conservatives by 20 points and falling.
That would lead to a breakdown of parliamentary seats something along the lines of this:
The Liberals’ disastrous handling of immigration has been a flashpoint for the government as they goosed population growth by 3% per year only to watch as per capita measure of growth, spending and prosperity slumped, all while making housing unaffordable and government services over-burdened.
It’s been clear to almost everyone for awhile that Trudeau was cooked. The exception was Trudeau himself and those closest to him in cabinet — such is the seduction of power.
But with the bulk of the Liberal party facing the end of their political careers, they’ve finally sharpened the knives. Liberal caucus meets on Wednesday various reports say up to 30 Liberal MPs who have signed on to an internal document calling on Trudeau to step aside.
Adding credence to the idea that time is up is that former British Columbia Premier Christy Clark said this week that she was interested in replacing Trudeau and further yesterday after former Bank of Canada and Bank of England Governor Mark Carney said he plans to enter politics.
Mark Carney
“I believe in the Liberal party. I think it’s got the right values. It
has the right combination of a social conscience and social priorities
at its core … but it also understands that we need a strong economy in
order to ultimately deliver that,” he said. “And look, the opportunity
may present itself. This is what I can do right now, and I’m doing it to
the best of my ability.”
The same report said that Liberals François-Philippe Champagne and Mélanie Joly have had conversations with colleagues about organizing future leadership bids.
I suspect Carney would be a strong favourite but not a sure thing. If he does enter the fray, he expect him to shore up the Liberals but strongly doubt he could topple the Conservatives polling lead.
I also wonder if opposition parties try to force an election before Trudeau can make his exit. That last point is the worst-case scenario for Liberals and why Trudeau could quickly resign and prorogue parliament before a vote of confidence.
Market implications
Canadian politics are a decent distraction but not a market mover at the moment. An election call would be CAD-positive but shuffling Trudeau out for Carney and delaying an election would be less notable. Either scenario wouldn’t shove the Canadian dollar more than a cent as the market is totally anticipating Pierre Poilievre’s Conservatives will be in power a year from now under any scenario.
