Tag Archives: Inflation

Roundup: Rota’s apology for his fatal mistake

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The warm glow of Ukrainian President Volodymyr Zelenskyy’s address to Parliament has given way to a bitter aftertaste as it turns out that the Ukrainian veteran that Speaker Anthony Rota introduced in his concluding remarks turned out not to have been either a Ukrainian-Canadian fighter or a Ukrainian partisan (as Rota’s introduction could fuzzily be construed as) but rather, was a volunteer for a Nazi-controlled unit, and it has turned into an absolute shitstorm of groups, particularly Jewish groups, being rightfully outraged, and partisan actors trying to use this to score points.

Rota released a statement of absolute, unequivocal apology, and I suspect that he will make a statement in the House of Commons first thing today, but it nevertheless casts a pall over him and his judgment, particularly because he has brought Parliament as a whole, and the government, into disrepute, and has quite possibly created an international incident over this where it feeds the interests of Russian propagandists who deride Zelenskyy and Ukraine as a whole as being some kind of Nazi stronghold. And I wish that I could say that this was atypical, but Rota has spent his time as Speaker largely being asleep at the wheel, and being a genial idiot who is more concerned with being everyone’s friend than he is in doing his job, which is tremendously unfortunately. And his trying to be everyone’s friend and being asleep at the wheel has brought us to this point here, and I have a hard time seeing how he has any choice in the matter here other than to announce his resignation on Monday morning, because his job is to protect Parliament, and he has done the opposite. There should be no walking back from this, no matter how well-intentioned he was, or how inadvertent the mistake.

Of course, the politics at play here have already spun all the way out of control, with Pierre Poilievre claiming that Trudeau met with said individual, while everyone else says that he hasn’t. People are insisting that Trudeau and the PMO should have known that this individual was invited, which I can’t see as possibly being the case if the Speaker, who is independent and does not run everything past PMO or PCO, had his own allotment of guest seats that he filled. I think that this will nevertheless obligate Trudeau to issue some kind of public apology, possibly in the Chamber, either before or after QP (assuming we have one if the Speaker resigns and they don’t have to suspend until a new permanent Speaker is chosen), and to offer a public assurance to Zelenskyy that he was unaware and that this situation is dealt with by Rota’s resignation. Unfortunately, this is going to play into so many propagandists’ narratives, and everyone is damaged by this.

Ukraine Dispatch:

Russian airstrikes killed two and wounded eight in the southern city of Kherson on Sunday, and early this morning, they launched a drone and missile attack against Odessa. New Western weapons are exacting a significant toll on Russian forces in the fighting near Bakhmut. President Volodymyr Zelenskyy offered two Polish volunteers awards on his return to Ukraine, as the two countries are in a major dispute over grain shipments. Here’s a look at an airport in Poland which serves not only as an arrival point for Ukrainians badly injured and in need of care, both civilian and military, as well as a transfer point for military equipment.

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QP: Needling about the usefulness of competing housing plans

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While the prime minister was still at the United Nations, his deputy was back in Ottawa and introduced a bill earlier in the day, but was absent from Question Period as it got underway, as was at least one other leader. Pierre Poilievre led off in French, and he cited documents published by the Bank of Canada where the governors are worried about creating false hopes about interest rates, and blamed Chrystia Freeland for creating those false hopes when she declared victory over inflation, and it has gone up since, and blamed deficits for this rise (which is not true). François-Philippe Champage replied in English that the last time Poilievre gave people advice, it was to buy crypto, and then patted himself on the back for tabling the bill on removing GST from apartment buildings and reforming competition law. Poilievre accused him of auditioning for the prime minister’s job, and repeated in English his accusation about Freeland and the nonsense about the deficit. This time Anita Anand got up, and she insisted that the government has a plan, unlike the Conservatives, and listed a few measures. Poilievre said that judging by applause, Champagne has a lead in leadership ambitions to Anand before using that as a segue to repeat the line about the Bank of Canada worrying about false hopes. Champagne got back up to again praise the bill they introduced earlier in the day. Poilievre blamed the federal government for housing price, and Sean Fraser got up to say that Poilievre’s plan only tinkers around the edges and doesn’t do anything measurable, and gave a couple of examples, calling Poilievre a “pretender” hanging things in the window. Poilievre insisted that his plan would ensure that nobody got tax breaks for $10 million luxury penthouse apartments, while his plan would get homes built. Fraser insisted that Poilievre’s plan wouldn’t do what he claims, that his government was doing what experts said, and that Poilievre may need to go back to him image consultant and start wearing glasses again if he couldn’t see that.

Yves-François Blanchet led for the Bloc, and he complained that the government was going to impose conditions on the $900 million in housing accelerator funds when social housing is a provincial responsibility. Fraser insisted that he was working with his counterpart in Quebec, in both languages. Blanchet insisted that the government was wasting time while seniors were not getting help with the cost of living, as big oil was making profits. (That’s…a stretch). Jonathan Wilkinson reminded him that they have been eliminating subsidies for the industry while working to create good green jobs.

Alexandre Boulerice rose for the NDP, and railed that the legislation on eliminating the GST on apartment buildings did not contain a definition of affordable. Soraya Martinez Ferrada praised their national housing strategy. Lindsay Mathyssen complained that the government isn’t stopping landlords from evicting people (which is a provincial responsibility), and demanded a federal acquisition fund to buy buildings to keep them affordable. Fraser patted himself on the back for their previous announcement in London, Ontario.

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QP: Complaining that the PM is in New York

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While the prime minister and his deputy were off to New York—the PM to the United Nations General Assembly, his deputy to meetings with the US treasury secretary—all of the other leaders were present. The anti-trans demonstrations outside the Hill were largely a failure, drowned out by counter-protesters, which was going to come up later on. Pierre Poilievre led off in French and stated that the prime minister said this was a difficult time for politicians, that the government declared victory over inflation prematurely and it rose again last month, before he demanded the government bring down taxes and so-called “inflationary deficits” (which is not a thing we’re dealing with). François-Philippe Champagne rose to much applause, before he said that he heard three things from Canadians—to help with the cost of groceries, the cost of housing, (the third thing didn’t come through), and they know that the government is there for them. Poielivre got up to needle the Liberals for their enthusiastic response to Champagne and suggested maybe they want him as leader instead, before deploying his usuals slogans. Champagne patted himself on the back for calling in the grocery CEOs before saying that people were tired of Poilievre’s slogans. Poilievre switched to English to complain about Trudeau going to New York before demanding they balance the budget and cut the carbon price. Jonathan Wilkinson got up to recite some lines about affordability before listing actions taken to address affordability while dealing with the existential threat of climate change. Poilievre again repeated that Trudeau went to New York while people have to pay carbon prices and demanded the cut it. Anita Anand pointed out that they have a plan to help Canadians unlike the Conservatives, and patted herself on the actions taken. Poilievre spouted a bunch of utter nonsense about inflation, and this time Sean Fraser for up to complaint that Poilievre only attacks the vulnerable and doesn’t have any plans to help families.

Yves-François Blanchet led for the Bloc, and complained about housing prices, and the supposed $900 million he claimed the federal government is withholding from Quebec. Fraser said he is working with the province. Blanchet insisted this was interference, and said that Ottawa should build housing (which he just said was Quebec’s jurisdiction) and then demanded the government stop subsidising the oil and gas sector and use that money for old age security. Wilkinson said that they have already ended subsidies.

Jagmeet Singh rose for the NDP, and demanded federal action against renovictions and “demovictions” (which is not really federal jurisdiction). Fraser praised the National Housing Plan, and that the government was going to build more houses. Singh switched to French to complain there were no affordable units to rent, and wanted guarantees they would be built. Fraser again praised the National Housing Plan, and switched back to English halfway through to complete his same talking points.

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QP: Lying by omission about inflation drivers

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In light of the ugly inflation numbers released this morning, Question Period promised to be a gong show, and lo and behold, as things got underway, Pierre Poilievre led off in French, railing about so-called “inflationary deficits” as being the cause of what raised inflation, which is false. Justin Trudeau noted that some of the spending were investments in Canadians while still being fiscally responsible. Poilievre accused them PM of “printing money” which is a lie, and claims hr warned him about inflationary deficits and that they put oil on the inflationary fire. Trudeau said that what he took from that is that Poilievre is saying he wouldn’t have given people the “grocery rebate” or cut child care fees while the government did so while being fiscally responsible. Poilievre switched to English to decry headline inflation and demanded a balanced budget. Trudeau insisted that they helped bring down inflation while helping Canadians with groceries and child care while being fiscally responsible. Poilievre insisted that the government was not compassionate by loading on debt, and gave some specious math about inflation. Trudeau said that Poilievre was talking down Canadians and the economy, before patting himself on the back for cutting GST on rental constructing and stabilising grocery China. Poilievre went on a mendacious tear about “newly-printed money,” and worried about a mortgage crisis. Trudeau relayed that he met a mother in Oakville whose mortgage payments rose as much as her child care costs went down, which was good for her, but the Conservatives have made it clear that they wouldn’t do anything about child care.

Alain Therrien led for the Bloc and demanded that the government release $900 million in housing funds to Quebec, presumably without any strings. Trudeau noted the $4 billion housing accelerator fund and that they were working with the government of Quebec to ensure that it gets the most effect. Therrien claimed to be baffled by this, and Trudeau repeated his response. 

Jagmeet Singh rose for the NDP, and he railed that the government was only trying to “stabilise” grocery prices and not bring them down—clearly demonstrating he has no idea what he’s talking about. Trudeau mouthed the pabulum about working with the CEOs. Singh then raised the allegation of the assassination by Indian agents, and wanted assurances of safety for those being threatened. Trudeau spoke about the rule of law and the being more to do, but didn’t really answer.

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QP: Lying about the price of lettuce

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Before things could get underway, a whole batch of new MPs needed to be brought in to take their seats—Liberals Ben Carr and Anna Gainey, and Conservatives Arpam Khanna, Branden Leslie and Shuvaloy Majumdar. When things got underway in earnest, Pierre Poilievre led off in French, blaming the prime minister of causing “housing hell” and demanded action to fix it. Justin Trudeau recited some pat talking points about helping Canadians and calling grocery CEOs. Poilievre quoted John Manley in claiming deficits were driving inflation, and demanded the government end the so-called “inflationary deficits.” Trudeau read the talking points about helping to build more apartments while repeating his boast about the grocery CEOs. Poilievre repeated his first question in English, and this time Trudeau read some good-news talking points about the deal in London, Ontario, which was the first deal but not the last. Poilievre repeated his second question in English with an added factoid about housing starts being down, and Trudeau read some good-news talking points about Calgary agreeing to federal conditions for more dollars. Poilievre again demanded a balanced budget, and Trudeau accused him of empty slogans and cited his record of bungling housing when he was minister, and then recited some points about the policy convention votes.

Alain Therrien led for the Bloc, he demanded solutions and not “scapegoats,” and accused the government of withholding $900 million from Quebec. Trudeau praised their Accelerator Fund and removing GST on new apartments, but didn’t address the allegation. Therrien repeated the demand, and Trudeau said the Bloc are only there to squabble, and repeated his same pabulum points.

Jagmeet Singh rose for the NDP, and he railed that the government was not punishing grocery CEOs, to which Trudeau insisted that they were making corporations pay their fair share, and Trudeau again raised the meeting with the CEOs and upcoming changes to competition legislation. Singh switched to French to accuse the government of allowing a loss of affordable housing units under their watch, and Trudeau repeated his same points in French.

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Roundup: Open Letters to Tiff Macklem

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BC premier David Eby decided he needed to be extra performative yesterday, and wrote an open letter to Bank of Canada Governor Tiff Macklem, urging him not to raise interest rates next month because of the “human cost” of these interest rate hikes—ignoring of course the counterfactual of the effects of unchecked high inflation and the “human cost” that it has over the short and medium term.

What is pretty galling in all of this is that Eby knows better. He was once a pretty good civil liberties lawyer, and he fully knows that the Bank is independent, and that they have a legal mandate that they need to fulfil when it comes to keeping inflation at two percent, and that their main policy tool is the blunt instrument of interest rates. His “I know the Bank is independent but…” spiel was frankly embarrassing, and should not have merited the attention it got from the media, but here we are.

Speaking of, Power & Politics was not only true to form in giving him a soapbox to make his point, and rather than doing their jobs of pointing to the irresponsibility of this kind of move, particularly at a time when you also have Pierre Poilievre warning that he’s going to fire the Governor (with what power?) and threatening the Bank’s independence. It would be great if CBC could do a single economics story properly and not just treat it like an issue to be both-sidesed, but they apparently have zero willingness to do so, and the fact that this Eby interview was that ignorant is a sign that they cannot be bothered to care about economics stories for anything than just trying to plug them into their established narratives, and it’s doing the country an extreme disservice.

Programming Note: I’m taking the full long weekend off, so I’ll see you early next week.

Ukraine Dispatch:

Ukrainian forces have reported some success in the south and east, but I am also tickled by their latest video offering, telling all of those armchair generals to basically shut up because they’ve been doing the heavy lifting on their own. President Volodymyr Zelenskyy says that Ukraine has developed its own long-range weapons that can strike 700 kilometres away, which may have been a sly nod to the attack on Russian airbases that destroyed a number of fighters. The mayor of Kyiv wants to build more fortifications, because there always remains the threat from Russia.

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Roundup: Games of inflation denialism

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As opposition parties continued to shitpost about the inflation numbers and the interest rate decision, it got intensely stupid. To that end, Emmett Macfarlane has coined the term “inflation denialism” to characterise these kinds of responses, and he’s completely right about it.

https://twitter.com/emmmacfarlane/status/1681741904797466624

https://twitter.com/emmmacfarlane/status/1681743338532134912

https://twitter.com/emmmacfarlane/status/1681744204223979524

As well, economist Stephen Gordon has spent the day calling out “greedflation” theorists, and it was fun to watch.

Programming note: I am away for the next week and a bit, so blog posts are on pause until August. Behave in my absence, and don’t make turn this car around.

Ukraine Dispatch:

There was an early morning Russian strike on the port city of Mykolaiv that wounded 18. Russians have been targeting ports and grain infrastructure in particular in recent days, deliberately targeting it in Odessa, as well as Chornomorsk. Meanwhile, Russia pulling out of the Black Sea grain deal is worrying Ukrainian farmers, some of whom still have last year’s crop stockpiled because they couldn’t get it to market.

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Roundup: Inflation falling into the control range

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The inflation numbers were out yesterday, and headline inflation dropped to 2.8 percent annualized, which is the lowest in the G7, and back within the Bank of Canada’s control range of 1 to 3 percent (though they have stated they are going to keep measures in place it reaches two percent). There are still hot spots—food price inflation is still fairly high, and shelter costs are also running high, but that’s not unexpected given where things are at right now.

Chrystia Freeland called this news a “milestone moment” that Canadians should feel some relief in, while the Conservatives repeated some of their usual talking points. The NDP, naturally, are keeping up with their attempt to blame high inflation on corporate greed, particularly food price inflation, even though the data doesn’t really bear that out, as I pointed out in this thread:

Ukraine Dispatch:

Russian forces struck the southern port city of Odessa, and while most of the missiles and drones were intercepted, there were hits and there was damage from debris. This was considered to be retaliation for the explosion on the bridge linking Russia to occupied Crimea. More strikes are aimed at Odessa in the early morning hours. Meanwhile, with the Black Sea grain deal ended by Russia, the EU is looking to transport more Ukrainian grain by rail and road, while the UN says they are floating “a number of ideas” around how to get that grain flowing again.

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Roundup: Another rate hike, more nonsense talking points in response

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Not unexpectedly, the Bank of Canada raised interest rates another quarter point yesterday because inflation is becoming sticky, particularly in the core measures that they use to strip out the highly volatile measures like gasoline prices. If you read through the Monetary Policy Report, which shows the state of the global and Canadian economies, economic growth in Canada remains stronger than expected—too strong to tame inflation—and there is still too much demand in the system, particularly for services as opposed to goods, which is keeping those prices higher, as they are especially sensitive to the tight labour market. To that end, the Bank is now expecting inflation to last around three percent for most of the next year before finally getting back to the target of two percent, which is later than they anticipated because economic growth is still too strong.

Meanwhile, Pierre Poilievre continues to spout absolute nonsense about the causes of this inflation—it’s not government spending, and that isn’t indicated in the MPR anywhere—and lo, media outlets like the CBC simply both-sides his talking points rather than dismantling them. He’s talking about how he’s going to cut taxes, which would actually fuel inflation rather than do anything to tame it (and no, carbon prices are only marginally inflationary and cutting them would do nothing to slow it). And then there’s the NDP, who think that the Bank should lay off and instead use windfall taxes, as though “greed-flation” is what’s driving inflation (again, not indicated anywhere in the MPR). But as economist Stephen Gordon has pointed out, this kind of promise of painless measures to fight inflation are the provenance of quacks and faith healers. It won’t help, and it will make things worse.

Ukraine Dispatch:

It was a third consecutive night of Russian drone attacks directed to Kyiv, and falling debris has killed one person. Elsewhere, Ukrainian troops are reporting “some success” around Bakhmut.

https://twitter.com/kyivindependent/status/1679340673357557761

https://twitter.com/davidakin/status/1679031785764659201

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Roundup: May inflation shows it’s cooling faster

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Statistics Canada released the May inflation numbers yesterday, and they were well down from the month previous, the headline number now down to 3.4 percent, which is in line what the Bank of Canada is predicting about it returning to about three percent by the end of the year. Part of this is because year-over-year gasoline prices fell, meaning that there is a base-year effect in play, but food inflation remains high (in large part because of climate change affecting food-growing regions and the difficulty in getting Ukrainian grain to market continues to keep those prices high), and mortgage interest rates are one of the factors fuelling this. Unfortunately, you have certain economists like Jim Stanford who think that this is the Bank causing this inflation, when in fact if they hadn’t raised rates when they did, higher inflation would still be ripping through the economy. (Seriously, stop listening to Jim Stanford).

Additionally, these numbers continue to prove that Pierre Poilievre’s narratives about inflation are specious at best, but are pretty much bullshit he is squeezing into whatever the headline seems to be. Last month, when there was a 0.1% uptick in inflation, Poilievre blamed it on the news of the budget deficit, and that this was proof that the deficit was “pouring gasoline on the inflationary fire.” That was wrong, and the Bank of Canada said that the trend was that inflation was still decreasing (and that the government’s fiscal policy was not having an effect on that decelerating inflation). And lo, inflation is still decelerating, in spite of the budget deficit. It’s like Poilievre has no idea what he’s talking about.

Meanwhile, economist Stephen Gordon has a few thoughts the numbers.

Ukraine Dispatch:

Two Russian missiles hit the eastern Ukrainian city of Kramatorsk, killing four and destroying a cafe that was fairly well known. Meanwhile, a UN human rights report shows that Russian forces carried out widespread and systematic torture of civilians they detained before executing them, but also found that Russians troops detained by Ukrainians also alleged torture and mistreatment.

https://twitter.com/united24media/status/1673784944798191617

https://twitter.com/defenceu/status/1673769121450696724

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