On March 10, Mark Carney became the new leader of the Liberal Party, and four days later, the sitting prime minister until the upcoming election on April 28.
Carney received nearly 86 per cent of leadership votes, trouncing runner-up Chrystia Freeland, who secured just 8 per cent. In every riding association across the country, Liberal members broke decidedly for the former central banker.
Many are likely breathing a sigh of relief as the Liberals poll ahead of Pierre Poilievre’s Conservatives for the first time since 2022. According to Angus Reid, if current voter intentions hold, the Liberals could secure a fourth term in office, this time with a majority. Yet there seems to be little question that Carney’s leadership means a divisive rightward shift, for both the party and the country.
For Canadian workers and unions, a government led by Carney will still entail a fight, if a marginally less intense one. The time to prepare for that battle is now.
Not long ago, a Conservative majority seemed all but inevitable. With former prime minister Justin Trudeau out, things are reversing decidedly. In the vote-rich Greater Toronto Area, the Liberals have surged: by 30 points in the city of Toronto and 25 points in the 905 ridings. In both Ontario and Quebec, the “natural governing party” now enjoys an appreciable lead among surveyed voters. Urban areas across the country are also rebounding toward the Liberals, with the party vastly improving its numbers in cities such as Calgary and Halifax
The numbers also suggest Carney has a clear advantage over Poilievre on economic issues, particularly those related to handling the tariffs threatened by the Trump administration. Poilievre’s cribbing from United States President Donald Trump’s campaign book has turned into a liability as the president continues to antagonize Canadians by threatening to annex the country and pursuing a devastating trade war.
Although no official platform has been released, there are initial signs that Carney’s assumption of the Liberal leadership will entail considerable rightward movement on key social and economic issues. As Jeremy Appel nicely put it, Carney looks like a return to 1990s-era Liberal politics, complete with spending cuts and fiscal orthodoxy.
Carney has a reputation as a crisis manager, having served as a central banker in both Canada and the United Kingdom during turbulent periods. As governor of the Bank of Canada, Carney held the reins during the 2008 financial crisis and is credited with preventing the Canadian economy from experiencing a significant downturn. In the U.K., Carney headed the central bank from 2013 to 2020 and managed the economic fallout resulting from Brexit.
In both cases, however, the primary consequences of economic crises fell squarely on workers. The Great Recession saw unemployment rise appreciably, and was followed by a slow and underwhelming recovery. In the U.K., the post-Brexit economy continues to be characterized by slow growth and high levels of inequality. Though not solely the fault of Carney, his commitment to neoliberal orthodoxy certainly played a role.
The new Liberal leader also spent more than a decade at Goldman Sachs, and most recently as the chair at Brookfield Asset Management, an asset manager overseeing hundreds of billions of dollars in investments, including in housing and essential infrastructure. As Nora Loreto points out, Brookfield also has a record of tax dodging and paying shareholder dividends while receiving public COVID-19 money. This is not a good sign for someone about to hold the strings of the public purse.
Although one of his first moves as prime minister was to end the national carbon tax, essentially nullifying Poilievre’s primary campaign promise, Carney previously served as the United Nations special envoy for climate action and finance where he advocated for greater private sector involvement in climate finance. This is indicative of his emphasis on market promotion.
In a thoughtful review of Carney’s 2021 book, Values: Building A Better World For All, Marc Lee at the Canadian Centre for Policy Alternatives argues that Carney is a firm believer in the power of markets, if not the unchecked market fundamentalism of Poilievre and others on the political right. Values, Lee contends, is primarily concerned with the functioning of markets, not with empowering workers or using the state to address crises such as climate change.
“[S]olidarity is not about the role of unions in supporting workers to get better wages and working conditions. Instead, it’s more of a vague appeal for education and training so that workers have the skills needed to thrive. Similarly, fairness and responsibility are not about progressive taxation and ensuring a more just distribution of income, but an appeal for markets to work better through prudence and disclosure,” Lee writes. “We can only conclude [Carney] is a very competent centrist whose plans for Canada won’t depart much from the status quo,” he concludes.
In perhaps his most disappointing policy announcement thus far, Carney has indicated he will scrap the Liberal’s plan to increase the capital gains inclusion rate. This mildly progressive measure was directed squarely at the passive incomes of the wealthiest sliver of Canadians and would have served as a healthy revenue generator. Instead, it’s destined for the scrapheap.
Changes to create a “leaner” Liberal cabinet also signal moves away from the mild social progressivism of the Trudeau era. For example, Carney has reduced his cabinet from 39 to 24 members and eliminated positions focused on equity and diversity. Both the Minister for Women and Gender Equality and the Minister of Diversity, Inclusion and Persons with Disabilities have been axed, a move criticized by unions such as the Elementary Teachers’ Federation of Ontario.
A changing of the guard in the position of finance minister also indicates that Carney is “businesslike and results-oriented,” in the words of Adam Radwanski at The Globe and Mail. François-Philippe Champagne will now take up that post, a figure understood to be to the right of former finance minister Freeland on economic questions. Radwanski notes, however, that Carney will likely do much of the “financial direction-setting” himself, given his economic bona fides. Carney has already indicated that a top priority will be cutting the “operational budget” in favour of capital expenditures, which is code for program cuts. This is not good.
Perhaps most indicative of the new Liberal leadership’s thrust, a cabinet reshuffle has entailed the formal elimination of the Minister of Labour, a federal cabinet position that has existed for more than 100 years and predates the modern labour relations system itself. Steven MacKinnon, the last minister of labour under Trudeau, will now be “Minister of Jobs and Families,” suggesting that the labour which fills jobs matters little to Carney.
The new Liberal Party leader is not an elected official with a voting record to scrutinize. He’s not consequently a retail politician either, so how he will engage with organized constituencies like the labour movement remains to be seen. Despite a good portion of Canadian labour remaining loyal to the NDP, large unions such as Unifor have increasingly engaged in a transactional form of politics that has opened space for Liberals to court unions. The Trudeau Liberals were particularly adept in this regard. Whether or not Carney will continue this practice remains to be seen, but his cabinet appointments and policy signals thus far are not promising.
Nevertheless, Canadian labour is calling on Carney to put workers first as threats from south of the border continue. The Canadian Labour Congress (CLC) appealed to Carney to strongly respond to the escalating Trump trade war. The CLC is calling on the Liberals to implement emergency and long-term reforms to Employment Insurance and to protect and create jobs in Canada. Unifor has also issued a similar call to the new Liberal leader.
For all the attention understandably devoted to the threats against Canada advanced by Trump, the top issue for Canadian voters remains the cost-of-living crisis–an issue which of course will be made worse if the trade war escalates. Unaffordable housing and elevated food prices are still putting a squeeze on Canadian workers and their families right now. Yet there’s little reason to believe Carney offers any promise of change on these issues, despite being viewed as the most capable of fixing cost-of-living problems among the federal leaders.
There’s no question that a Carney Liberal government would do less damage to workers than Poilievre’s Conservatives. Still, Carney’s policy signals give us plenty to worry about. The biggest risk, however, is what comes after.
As in many other capitalist democracies, including Germany, France and the U.S., tepid centrism only prolongs the lurch to the right. Four years of more austere Liberal rule is hardly a recipe for staving off the extreme right. A consummate technocrat like Carney, committed in his bones to neoliberalism, can only exacerbate the economic pain that is driving greater numbers of people into the arms of the right. Labour must offer an alternative.