Roundup: Higher inflation than expected

It is now day fifty-seven (or so) of Russia’s invasion of Ukraine, and hope is waning for the remaining defenders of Mariupol, and the civilians still sheltering there. As the fighting intensifies in the eastern part of the country, there are also concerns that it will devolve into a war of attrition, which Russia has historically been more able to withstand. We have also learned more about what happened when Russian troops occupied Chernobyl, where staff were working at gunpoint, and sleeping three hours a night in order to safeguard the site and ensure that Russians didn’t tamper with any of the equipment there.

Closer to home, the inflation numbers were released yesterday, and they were much higher than expected, as conflict inflation brought on by the aforementioned invasion of Ukraine is hitting. And of course, most media outlets were useless in explaining the causes of it, while the parties were equally useless in their own reactions. The government keeps focusing on their talking points about things like child care and dental care, and the fact that they indexed benefits, rather than actually explaining the drivers. The Conservatives are railing about “printing money” (which, to be clear, nobody is actually doing) and insisting that the government should declare a GST holiday, which would a) do nothing for grocery prices as most groceries are GST-exempt; and b) would have a stimulative effect and just fuel even more inflation, especially as people would be likely to use said GST holiday to buy big-ticket items. And the NDP, predictably, chalk this up to greed and want higher wealth taxes, which again, do very little about the drivers of inflation.

And then there’s the Bank of Canada, who will be forced to respond with higher rate hikes, but the question becomes whether they’ll keep the increases more gradual—another 50 basis points at the next meeting in June—of if they’ll go even higher as a way of demonstrating that they are really taking this seriously and that the system of inflation control that they’ve been responsible for since the 1990s will prevail. It doesn’t directly address the drives, but it could be that the signals are more important than the actual policy at this point, because the bigger worry is the expectation that inflation will continue, which will turn it into a self-fulfilling prophecy—something they are very, very keen to avoid.

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Roundup: Displacing and dispersing Ukrainians into Russia?

We are now on day thirty of Russia’s invasion of Ukraine, and while Kyiv remains safe, there are reports that as many as 400,000 Ukrainians have been forcibly relocated into Russia, where they are being dispersed to economically depressed regions in that country. The Russians are claiming that these relocations are voluntary, but Ukrainian officials worry they may be used as hostages. Meanwhile, president Volodymyr Zelenskyy addressed the NATO summit happening in Brussels and asked for aircraft and tanks, but was mostly only promised more of the same kinds of aid that they have been receiving to date.

Closer to home, there are now two more prospective entrants into the Conservative leadership race—former floor-crosser-turned-deputy leader Leona Alleslev, who has launched a website and who has volunteers getting the necessary signatures required to launch a bid; as well, a failed candidate named Joel Etienne from York Centre, who has also put up a website and is collecting signatures. One of the other leadership candidates, Marc Dalton, seems to have enough self-awareness that he knows he’s a long-shot candidate, but seems to be pinning his hopes on the vagaries of preferential ballots as his salvation. Oh, and he still hasn’t lined up his entrance fee yet, so that’s probably a sign about his chances.

As these entrants keep lining up, Candice Bergen is warning them not to call those in the race that they disagree with as “not Conservative” because that’s “identity politics,” and they don’t want to wedge, divide and polarize, because that’s what they accuse the Liberals of doing—which is kind of hilarious when you think about it. They’ve explicitly framed this contest as one for the “soul of the party,” and the contest is going to entirely be about whether they find a leader who can appeal to enough of the moderate Canadians in the suburbs who can deliver them an election victory, or whether they retrench into their “values” and electoral consequences be damned because they’re acting like Conservatives and not Liberals. And when you set up the contest as one about what constitutes those “values,” with a purity test or two thrown up around them, who is and is not a Conservative is going to be a bigger sticking point in this race the longer it goes on.

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Roundup: A growing humanitarian crisis

We are now on day fourteen of Russia’s invasion of Ukraine, and some of the big concerns are the growing humanitarian ones—not only the inability to safely get civilians out of cities under bombardment, but the fact that in some of those cities, particularly Mariupol, people are trapped with no electricity, little food, running water, or medical supplies. Meanwhile, president Volodymyr Zelenskyy addressed the British Parliament via video, and called on them for even tougher sanctions against the “terrorist state” Russia. The US has decided to ban all Russian oil and gas, while corporations like McDonald’s and Starbucks have decided to suspend operations in Russia (though more likely because the ruble is nearly worthless and not something they want to be doing business in).

Justin Trudeau was in Latvia for NATO meetings, where he announced that Canada’s mission there would be extended for several more years. NATO Secretary General Jens Stoltenberg also made the point of warning Russia against attacking any supply lines supporting Ukraine within NATO territory, citing that it would trigger Article 5. Poland also floated the idea of sending fighter planes to a US/NATO base in Germany to then somehow send to Ukraine, but the Pentagon nixed the idea as unworkable.

All of this talk, of course, leads to yet more questions about military spending in Canada, and that “two percent of GDP” target, which is a very poor metric.

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Roundup: Prepping for a Euro trip to coordinate more sanctions

As day ten of the Russian invasion of Ukraine picks up, there wasn’t the same drama around any nuclear facilities, though it now seems that Russia is in control of the Zaporizhzhia facility that they had been shelling the other night, so that’s not great. Ukraine’s requests for a no-fly zone continue, even though it’s not going to happen because that would drag NATO into a shooting war with Russia, which is a nuclear power, and that is a Very Bad Thing. Justin Trudeau made the point yesterday that we need to keep ourselves out of a situation in aiding Ukraine where NATO forces are put in direct confrontation with a Russian soldier, while the hope remains that the ongoing sanctions create the conditions for those around Putin to force him to stand down, because they have been so effectively crippled. But we’ll see. In the meantime, a warning about cyber warfare escalation in this conflict—they have not deployed their full arsenal, and that’s probably for the best.

Trudeau, meanwhile, will be heading to Europe for a series of meetings starting on Sunday, along with Anita Anand, and starts off in London (where he will have an audience with the Queen), then Latvia, Germany, and Poland. It sounds like part of what is being discussed are the next steps in tightening the screws on Putin and his regime, so coordination with allies could be a good and necessary next step.

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Roundup: Zelenskyy speaks with his inspiration, Trudeau

We are now in day eight of Russia’s invasion of Ukraine, and attacks against hospitals, schools and critical infrastructure continue. Russian casualties are mounting, but Putin shows no sign of stopping, even as we are well into war crimes territory (and Ukraine is also making announcements of policy changes that would also be war crimes, so this is not solely a Russia problem). When it comes to sanctions, Germany has seized the yacht of one of Russia’s oligarchs, and one can expect more seizures to come in the days ahead. Canada has also joined 32 other countries in denouncing Russia’s use of propaganda in its campaign against Ukraine.

While there was no new announcement of sanctions from Canada yesterday, there was a call between Justin Trudeau and Volodymyr Zelenskyy, who apparently thanked Canada for our efforts and stressed the need to keep expanding sanctions (which is happening, but being done in a coordinated fashion with allies). Also, interestingly, an old tweet of Zelenskyy’s was circulating yet again, where he cited Trudeau as one of his inspirations to join politics—which must really burn Trudeau’s critics, who are hailing Zelenskyy for his leadership in a crisis.

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QP: Some talking points about supporting Ukraine

For Wednesday, caucus day, and this prime minister’s proto-PMQ day, there was a very curious absence in the Chamber, as Candice Bergen was absent even though every other leader was present—even Amita Kuttner was in the gallery watching. Luc Berthold led off, script in front of him, and in French, demanded the expulsion of the Russian ambassador. Justin Trudeau stated that they have been clear in their condemnation, and said they would continue to aid Ukrainians in every way possible—but did not answer the question. Berthold insisted there was no reason for Putin’s representative to stay here and spread misinformation, and Trudeau repeated his “everything we can do” talking points rather than do something like speak about the value of diplomacy. Berthold the pivoted to provinces lifting public health orders and demanded that all federal vaccine mandates be lifted, and Trudeau read some well-worn talking points about following science, and praised Canadians for getting vaccinated. Michael Chong took over in English, and he again demanded that the a Russian ambassador be expelled, and he went on about doing everything they can do for Ukraine. Chong demanded the government order the CRTC to keep RT from Canadian airwaves, and Trudeau read a script about information warfare and that they are asking the CRTC to conduct a review, but it was important to note that this was in the hands of independent regulators and not politicians.

Yves-François Blanchet led for the Bloc, and worried about the government musing about sending Western Canadian oil to Europe, and Trudeau, extemporaneously, said the future depends on decarbonising but at the moment Europe needs help so they would see what they can do. Blanchet wanted more clarity about what this means, and Trudeau rebutted that his was the government that has done the most to combat climate change, but they would be there to help friends in Europe.

Jagmeet Singh rose for the NDP, in person today, and demanded visa-free travel for Ukrainians, citing Lloyd Axworthy, and Trudeau insisted they were not refusing but were working to increase the ease by which they can help Ukrainians coming to Canada, and they were looking at the best way to go about this. Singh repeated the demand in French, and a Trudeau repeated his answer.

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QP: Repeating the same Ukraine questions once again

The prime minister was present for QP today, as was his deputy, so we would see how the questions about the war in Ukraine would shape up with him in the room. They weren’t much improved—or different for that matter. Candice Bergen led off, script in front of her, and she demanded the expulsion of the Russian ambassador and to recall ours from Moscow, because they seem to believe that diplomacy is a cookie for good behaviour, which it absolutely is not. Justin Trudeau said that the foreign minister had summoned the Russian Ambassador to be admonished, but that they were keeping all tools on the table, which one assumes includes diplomacy. Bergen then demanded visa-free travel to Canada for Ukrainian refugees, for which Trudeau read that they have bolstered capacity and priorities Ukrainian applications. Bergen then stated that the longer Canadian oil and gas stays in the ground, the more Putin wins, and demanded a policy of drilling. Trudeau noted their supports for Alberta, their support for the Trans Mountain expansion, and that they were working toward a cleaner future. Bergen then pivoted to the Emergencies Act invocation, and insisted that the only used it for political reasons, for which Trudeau read that law enforcement found it essential, and accused the Conservatives of being unable to pick a lane. Bergen then demanded that all federal vaccine mandates be lifted and accused the government of “dragging their knuckles” because vaccine mandates are “so yesterday.” Trudeau reminded her that they base their decisions based on science.

Yves-François Blanchet rose for the Bloc and wanted to ensure that sanctions would remain in place until the last Russian soldier was out of Ukraine, and Trudeau largely agreed with the notion. Blanchet then worried about the rhetoric of using the war in Ukraine as a propaganda tool for western Canadian oil and gas, for which Trudeau noted that while Canada imports negligible amounts of Russian oil and gas, they need to work with Europe to end their dependence on it, talking about a clean energy future.

Jagmeet Singh appeared by video in French to ask about sanctions on Belarus, for which Trudeau reminded him that they already imposed them for their complicity in the invasion of Ukraine, and that they were looking at future ones. Singh switched to English to demand a barrier-free process for Ukrainians seeking refuge in Canada, and Trudeau note that they have been preparing this for a month now.

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QP: Support for Ukraine, but what about “ethical oil”?

While the prime minister was around, and would give a press conference after QP, and make a statement in the Chamber later in the evening, he was not present for QP itself, though his deputy was. Candice Bergen led off, saying that many of the country’s actions were too little too late and demanded the expulsion of the Russian ambassador and to recall ours from Moscow—because they believe diplomacy is a cookie for good behaviour. Chrystia Freeland rose to say that Canadians were united, and that this was about freedom versus tyranny, but didn’t address Bergen’s demand. Bergen said she agreed with the sentiments, and wanted visa-free travel for Ukrainians to Canada, and Freeland rose to address the previous question and noted that there were Russian officials who stood against the regime and she urged those officials in Canada not to be complicit, and said all options were on the table. Bergen demanded that the country end its “dependence” on Russian oil—of which, vanishingly little actually flows into this county—and to send Canadian oil to Europe. Freeland noted that the sanctions on Russia are having an effect, and hurting their oil exports was one way. Luc Berthold took over in French to demand the expulsion of the Russian ambassador, and Freeland took the opportunity to repeat her initial statement about unity in French. Berthold then repeated the demand for visa-free travel, and Freeland recounted news from her own family in Ukraine who decided to stay and fight, and that Canada would support them as well as those fleeing.

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Alain Therrien led for the Bloc, and he gave a paean to the bravery of Ukrainian people, and pledged Bloc support to the government’s actions, and wondered what else they could do to help. Freeland recited her talking points about sanctions hurting “Fortress Russia.” Therrien asked if they can waive visas or take other actions, and Freeland noted that they have already started to welcome Ukrainians, including those currently in Canada and unable to return home.

Alexandre Boulerice led for the NDP by video, and after a false start, and demanded Canada do more to help Ukrainian refugees, to which Freeland assured him they were already doing so in a united fashion. Jenny Kwan took over in English to make the same demand, and Freeland spoke of her pride in the brave resistance of Ukrainians, and said that of course they were helping Ukrainian refugees with more details coming soon.

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Roundup: SWIFT justice, and central bank sanctions that will hurt

The fighting continues in Ukraine, and Russian forces continue to be held at bay, and they have been unable to take Kyiv. Putin’s plans for a swift takeover so that he can install a puppet regime continue to be thwarted, and the only thing he has managed to do is get the West fully onside against him—much faster than anyone possibly could have anticipated.

To that end, resistance to kicking Russian banks out of the SWIFT system melted pretty quickly (considered a “nuclear option” for financial sanctions), and even more crucial was a strategy to target Russia’s central bank, so that its foreign currency reserves held outside of the country, which they were hoping to use to ride out the worst of the sanctions, won’t be available to them, creating a much bigger financial problem for them than they had anticipated. Central to this effort was Chrystia Freeland, who has been a strong performer behind-the-scenes in getting allies onside. In the meantime, Canada is sending another $25 million in non-lethal aid for things that Ukraine needs, such as body armour and gas masks, but more lethal aid is still being coordinated with NATO allies. As well, Canada joined other allies in closing our airspace to Russian airlines, and two of our cable companies have banned RT from their airwaves, given that they are a Russian propaganda arm. On top of that, we have confirmation that the Communications Security Establishment is actively using its resources to defend Ukraine against cyber-attacks, which is a significant development. Less helpful is the Conservatives demanding that we expel the Russian ambassador and recall ours from Moscow—we still need diplomats, and diplomacy is not a cookie you get for good behaviour, and it astounds me that Conservatives still don’t get that.

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Of course, the big worry remains Putin and his nuclear arsenal, which has been put on high alert. Ukraine’s foreign minister says this is simply an attempt by Putin to raise the stakes in advance of peace talks, which they aren’t going to be intimidated by. NATO’s former deputy secretary agrees that this is a threat that Putin has used before and is a bit of crying wolf, so I guess we’ll see, but it’s certainly a concerning escalation in light of the fact that much of what Putin has done doesn’t make a lot of sense to rational actors.

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Roundup: More sanctions, more pressure on allies

Day three of fighting in Ukraine, and Russian forces have not overtaken the country, as they perhaps thought they would have by now. Prime minister Justin Trudeau announced yet another round of sanctions that both targeted Putin and his inner circle personally, but also took aim at Belarus and its president, as Russia transited through that country as part of the invasion, and seeks to hurt Russia’s allies. Trudeau also openly said that Canada is calling on its allies to have Russia removed from the SWIFT system, which seems to me to put pressure on those European holdouts. On top of that, the government announced more special immigration measures for Ukrainians, that Canada was preparing to move another 3400 troops to shore up NATO operations upon request, and matching donations to the Red Cross for their Ukrainian relief efforts. Oh, and sub-nationally, a number of provinces with publicly-owned liquor stores announced that they were pulling Russian products from their shelves (but it’s the LCBO that will make this hurt for Russia, as it is the largest purchaser of alcohol in the world).

The thing that Canada and NATO will not be doing is enforcing a no-fly zone over Ukraine, no matter how much Ukraine asks for it, because this would involve shooting down Russian aircraft, and that would essentially be declaring war, and then it’s the big time. Nobody wants that—especially not that Putin has nuclear weapons. And no matter how many times reporters ask about it, the answer is the same: no. (In my next YouTube episode, Steve Saideman and I discuss this very issue, which will be available for Patreon subscribers on Sunday).

In the meantime, there are some wild stories coming out of Ukraine—the 13 border guards on Snake Island who told the Russian warship to “go fuck yourself” before they were shelled; the woman confronting a Russian soldier and giving him sunflower seeds so that they’ll grow from his corpse when he’s buried; and President Volodymyr Zelenskyy filming himself and top officials in the streets and that they are determined to stay put, showing that the disinformation that he has fled the country is not true.

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