The bad medicine of Pierre Poilievre

As the world economy continues to emerge from its torpor caused by last year’s pandemic, concerns about inflation risk have returned. And no one is happier to amplify those fears, or blame them on liberal leader Justin Trudeau, than Pierre Poilievre. After inflation year after year paste 4.1 percent in August, the highest reading we’ve seen in Canada since 2003, Poilievre tweeted: “The ‘experts’ were wrong again: it turns out that printing money to finance deficits continues to cause inflation.”

It does not matter that this figure is less than the 5.3 percent The United States saw last month, or that Canada’s figure would be 3.2 percent if you remove the impact of rising oil (and gasoline) prices. For Poilievre, this is vindication in her long-term attempt to link liberal policies to global economic trends, and proof that while Erin O’Toole may currently be the leader of the Conservative Party of Canada, Poilievre is the one. most outspoken ambassador of his values. and beliefs. Trudeau may not think about monetary policy, since said at the beginning of the campaign, but it seems that Poilievre does not think of anything else.

On an infamous Facebook video Earlier this year, he channeled his inner Ben Shapiro and used a piece of wood as a representation of the dangers of inflation. “In one year, you went from being three feet two by four to one foot,” he said. “The difference is inflation.” Turns out the difference was something completely, well, different. After peaking at nearly $ 1,700 in May, when Poilievre shot his video, lumber prices it fell to less than $ 500 in August, a drop of more than 70 percent. Today, timber is trading at the same price as in 2018, which is not a sign of an inflationary spiral.

In fact, much of the inflation that people like Poilievre held onto their pearls earlier this year was a direct result of the COVID-19 pandemic. As the chairman of the US Federal Reserve, Jerome Powell said In a speech on August 27, “the rise in inflation is so far largely the product of a relatively small group of goods and services that have been directly affected by the pandemic and the reopening of the economy.”

In other words, it is not the result of the US Federal Reserve or the Bank of Canada printing money, as Poilievre and his fellow US inflation hawks like to claim. And the austerity they prescribe would undermine the economic recovery that is underway, just as it did the last time this drug was prescribed in the wake of the 2007-08 financial crisis. As Robert Burgess and Beth Williams of Bloomberg argued in a recent part, “A less accommodating posture open ports in China who have been affected by COVID outbreaks? Would the semiconductor chip crisis that has slowed car production and skyrocketed used car prices? Would you reverse the five-fold increase in container shipping costs? Would it drop food prices that have skyrocketed? because of the droughts and worker shortage? Would you address the truck driver shortage which have led to higher transportation costs? The answer to all these questions is no. “

Don’t expect Poilievre to take no for an answer here, or to abandon his crusade anytime soon. He remains convinced of the Bank of Canada’s decision to support the economy during COVID-19 through interest rate cuts and so-called “Quantitative easing” will lead to a massive inflation spike, one that will drive up the price of everything from groceries to housing. And while his party leader may have referenced the “inflation crisis” in the recent English debate, he is the leader of another party, and Poilievre’s former cabinet colleague, who seems to share his passion for the issue.

“Inflation is the most insidious of all taxes,” said PPC leader Maxime Bernier on August 19. statement. “It affects the poor and those with fixed incomes, such as retirees, more than the rich.” That’s why his party is proposing to cut the Bank of Canada’s inflation target from two percent to zero, a ruinous economic strategy, but one that will attract inflation checkers like Poilievre.

However, the real question is whether the inflation issue will resonate with voters. It has been a long time since it was a key electoral issue; so long, in fact, that you have to go back to the last liberal leader named Trudeau. In 1974, the growing threat posed by rapidly rising prices consumed much of the political oxygen of that campaign, with progressive conservative Robert Stanfield defending wage and price controls and liberal leader Pierre Trudeau staunchly opposed to the idea. Ironically, after winning the majority, Trudeau would quickly adopt price and wage controls after inflation approached 11 percent in 1975.

Poilievre’s attempt to make inflation a voting issue is working with an op-ed writers at the Financial Post, and Jason Kenney’s favorite economist Jack Mintz has written to number of columns that lend their support to the cause. But so far, at least, he doesn’t seem to be connecting with the general public, whose broader concerns about affordability don’t seem to translate into a conversation about monetary and fiscal policy. We’ll have to wait and see if that ends up being a missed opportunity by the time we get back to the polls, and if Poilievre is in an even better position to justify his argument again.

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