G7 says no to Afghanistan evacuation extension

Two elderly women evacuated from Kabul arrive at Hindon Air force base near New Delhi, India. Sunday, Aug. 22, 2021. AP Photo.

Welcome to The Hub’s Federal Election 2021 Policy Pulse, where we’ll be tracking all the policy announcements from the major parties, with instant analysis from our crew of experts.

With the election scheduled for Sept. 20, we’ll be monitoring 36 days worth of policy ideas, so watch out each morning for the day’s live blog where we’ll be tracking every announcement as it happens.

5:30 p.m. — Daily recap: O’Toole promises to protect pensions after corporate bankruptcies

The Liberals unveiled their housing plan, the Conservatives tackled corporate bankruptcies and the NDP wants to end for-profit long-term care. Here’s the rundown, with more news and analysis below.

  • Conservative leader Erin O’Toole was in Ottawa this morning promising to protect workers’ pensions in the wake of a corporate bankruptcy. 
  • NDP leader Jagmeet Singh was in Mississauga this morning with a promise to end for-profit long-term care in Canada.
  • Liberal leader Justin Trudeau was in Hamilton this morning promising to build, preserve or repair 1.4 million homes over four years to ease housing affordability issues in the country.

4:45 p.m. — G7 says no to Afghanistan evacuation extension

The Hub’s associate editor Amal Attar-Guzman provides an update on the G7 meeting held today about the crisis in Afghanistan:

Prime Minister Justin Trudeau attended an emergency G7 meeting today called by U.K. Prime Minister Boris Johnson about the increasingly dire situation in Afghanistan. Thousands of Afghan citizens and interpreters, as well as other foreign nationals, are currently outside of Hamid Karzai International Airport in Kabul attempting to flee the country.

G7 leaders convened to discuss whether they will extend the evacuation deadline of August 31st, despite the Taliban’s claims that an extension is a red line, and have warned “consequences” if there was a delay.

Despite Johnson’s push for the extension, U.S. President Joe Biden and others have decided not to extend August 31st evacuation deadline. Canadian Armed Forces and other allied armed forces will have a week to evacuate as many people as they can before the deadline. After the deadline, people will not be able to leave Afghanistan.

Taliban spokesperson Zabiullah Mujahid has said the Taliban will not allow Afghan citizens to leave the country, unlike foreign nationals.

Trudeau had promised that 20,000 Afghan refugees will be resettled into Canada, including former interpreters who have aided the Canadian forces while in Afghanistan. After the G7 meeting, before boarding the campaign bus in Hamilton, Trudeau said Canada was prepared to stay past the 31st deadline.

More than 1,100 Afghans have left on Canadian evacuation flights but with the rejected extended deadline, Canada and its allies will now have to ramp up the evacuation process.

The ongoing crisis has seized the attention of Canadians and foreign policy experts have urged the major parties to recognize the importance of international affairs in the election campaign.

3:30 p.m. — Matching funds could help young Canadians save for a home

The Hub’s content editor L. Graeme Smith and editor-at-large Sean Speer suggest a different way to help young Canadians save for their first home:

With Liberal Party leader Justin Trudeau’s housing announcement today — including a commitment to build 1.4 million homes over four years — we now have substantive housing policy promises from each of the major parties.

They’ve clearly internalized growing public concerns about housing affordability in our major urban centres in particular and elsewhere in the country more generally. A 25-percent increase in year-over-year housing prices was doubtless bound to capture political attention.

The proposed policies have converged in some cases such as a ban on homeownership for non-residents or new conditions on federal dollars tied to provincial and local land-use reforms. And differed in others such as the Liberal proposal for a Home Buyers’ Bill of Rights or the NDP’s proposal for a massive increase in social housing units or the Conservative proposal to review the federal government’s real estate holdings and release at least 15% for housing use.

One interesting feature of the Liberal Party’s policy package is a promise to create a new, preferential Tax-Free Savings Account for first-time homebuyers though the details are sparse.

Notwithstanding that the Trudeau government rolled back the maximum annual contribution level from $10,000 to $5,500 in 2016, the new proposal would set a preferential $40,000 limit for first-time home-buyers in order to save for a down payment. (Had the government merely left the TFSA limit unchanged, Canadians would now nearly have access to the same amount of incremental tax-free savings room as is being proposed.)

An obvious challenge with the Liberal proposal is that most young Canadians don’t have sufficient savings to utilize such a high contribution limit. The risk therefore is that the preferential savings limit benefits a minority of those trying to save for a down payment. (The Liberal Party made a similar argument incidentally when it first committed to rolling back the TFSA limit in the 2015 election campaign.)

One way to address this challenge would be to establish a matching fund model that operates on a means-tested basis. Its policy design would resemble the current Registered Education Savings Plans or Registered Disability Savings Plans models. It could be constrained to savings for housing or could be used to help low-income Canadians save more generally.

Such an approach would address any concerns about the Liberal policy’s progressivity and may ultimately help more young Canadians save to buy a home.

2:50 p.m. — Health-care announcements like ‘pouring more water into a bucket with a hole’

Shawn Whatley, a Macdonald-Laurier Institute Munk Senior Fellow and the author of When Politics Comes Before Patients: Why and How Canadian Medicare is Failing, examines recent health-care announcements:

Liberal Party leader Justin Trudeau announced yesterday a $3 billion plan to hire and incent more family medicine practitioners. Additionally, the Liberals are pledging an additional $6 billion to address Canada’s wait list crisis.

For their part, the Conservatives have promised to increase the growth rate of Canada Health Transfers by at least 6 percent, which they say will “inject nearly $60 billion” into the healthcare system over the next decade, specifically focusing on mental health and addiction support. 

These are well-meaning announcements; Canadians have unequal access to doctors who run point on providing health services to Canadians. Those in Northern, rural, and remote areas are acutely underserviced, and so additional targeted investments into fixing this problem are of course welcome. Mental health and addiction are chronically undertreated in this country and have long contributed to strain on the overall system.

However, these policies are akin to pouring more water into a bucket with a hole. The reality is, Canada’s healthcare system is fundamentally broken, and it is broken beyond the point where simply throwing more money at the problem will fix it.

Overcrowding, hallway medicine, shortages in long-term care, world-famous wait times, technology shortages, and spiralling costs are just a few of the problems facing our beleaguered healthcare system. Canada has 2.5 hospital beds per capita, versus the OECD average of 4.7. Vague spending promises divided over several years, ten provinces, and three territories are simply insufficient.  

The problems stem from how healthcare in this country is structured. With unlimited, open-ended demand, no competition driving efficiencies and innovation, and priorities often being set from Ottawa, Canadians end up paying more than the OECD average to receive worse care on average.

If political parties want to be serious about fixing Canada’s healthcare woes, they would start by looking at what reforms can be made to the Canada Health Act to ensure universal access while also introducing the competitive best-practices observed in Japan, South Korea, Taiwan, Sweden, Switzerland, or other more stronger-performing jurisdictions.

2:00 p.m. — The crisis in Afghanistan marks the end of an era in world politics

As the G7 meets today to discuss the chaos in Afghanistan, international relations expert Zack Paikin argues that the ongoing crisis has major implications for how Canadians should conceive of their country’s role in the world. Paikin writes:

As our political parties campaign across the country, it’s a perfect time to ask some hard questions about Canada’s foreign policy ambitions.

The post-Cold War era has been marked by a Western effort to construct a liberal world order. In truth, this project had already failed several years ago.

Two major events in 2021 undeniably prove that this historical period has ended: the Jan. 6 assault on the U.S. Capitol and the Taliban takeover of Afghanistan.

Read the whole piece at The Hub.

12:15 p.m. — Canada’s trade policy should not sacrifice quality for quantity

The Hub contributor Brent H. Cameron examines a key plank in the Conservative platform on trade:

A recent article in the Financial Post questioned the utility of the Conservative Party’s proposal to negotiate quadrilateral trade and free movement agreements among the so-called CANZUK countries — Canada, Australia, New Zealand and the United Kingdom.

Economists cited in the article argue that the benefits up and beyond the status quo would be marginal and therefore the negotiation efforts would not be justified. They assert that the CPTPP already gives Canada preferential access to two of the countries, and potentially all, if Britain joins.

Arguments against CANZUK almost invariably take a quantitative approach to trade — a focus on the volume of trade, and the number of prospective new consumers for Canadian goods and services. This is how we rationalize any trade deal, by narrowly concerning ourselves with how much we can buy and sell.

Yet, if this was all there was to it, presumably globalization would be more popular than it is. Why is something that is supposed to be so inherently good for our economy face such opposition?

The perceived failure of globalization has not been one of maximizing the quantity of trading arrangements, but in ignoring their relative quality.

According to the Office of the U.S. Trade Representative, in 2017 the United States did nearly as much bilateral trade with China as with Canada — $659.4 billion compared to $662.7 billion.

Conventional wisdom holds that the relationships are equal. Yet, with Canada, the U.S. earned a surplus of $11.9 billion — the equivalent of $0.02 on the dollar. With China? A loss of $336.2 billion, or $0.51 on the dollar. Nearly the same amounts of two-way trade but a much different result.

The allegation of comparing apples to oranges might hold if it were not for the fact that the U.S. numbers that same year for India — also in Asia, also a low-wage producer and with a billion people — produced a deficit to the U.S. equivalent to $0.35 per dollar.

So, what about CANZUK? Well, in 2015, Canada enjoyed an $11.9 billion surplus on $662.7 billion of combined bilateral trade with the other three countries, or 2 cents on the dollar — exactly the U.S. advantage over us two years later.

Compatibility makes America’s trade with Canada and India fairer than with China. It also makes Canada’s trade with the other CANZUK countries as close to full balance as one can get with such volumes.

Companies know that the balance between profit and loss is just as important as the sales figures, and yet we do not apply those lessons to our trade with the broader world. Economists may concern themselves with the volume of trade, but to a large portion of the population it is the direction that decides whether there is money for a mortgage or a child’s education.

CANZUK deals with this and can go far beyond an agreement like CPTPP — into areas such as free movement, mutual recognition of educational and professional credentials, research and development, humanitarian efforts and security, while preserving Canadian sovereignty and Canadian jobs.

We’ve tried free trade for decades. Maybe we should try fairer and more balanced trade for a change.

11:40 a.m. — It’s a good sign that we’re talking about inflation

In the first week of the campaign, questions about inflation and the Bank of Canada’s mandate have emerged as important ones for the party leaders.

The Hub’s editor-at-large Sean Speer spoke to Yahoo Finance’s Crisis Management podcast on why heightened attention on these issues is healthy for Canadian democracy and public policy.

Listen to the podcast here.

11:10 a.m. — Economist Rob Gillezeau on the competing housing plans

View the whole thread on Twitter.

10:30 a.m. — NDP promises to end for-profit long-term care in Canada

NDP leader Jagmeet Singh was in Mississauga this morning with a promise to end for-profit long-term care in Canada.

Singh also promised to develop national care standards and boost wages for long-term care workers.

10:10 a.m. — O’Toole promises to protect pensions after corporate bankruptcies

Conservative leader Erin O’Toole was in Ottawa this morning promising to protect workers’ pensions in the wake of a corporate bankruptcy.

Along with ensuring pensioners have priority over “corporate elites” in the event of a bankruptcy or restructuring, O’Toole also promised to prevent executives from getting bonuses during a restructuring if the pension plan is not fully funded.

9:00 a.m. — How should policymakers navigate the new great power rivalry?

Take a short break from the election campaign with our fascinating new interview on the world’s shifting geopolitical situation.

In this Hub Dialogue, The Hub’s editor-at-large Sean Speer speaks to Thomas Wright, the author of  Aftershocks: Pandemic Politics and the End of the Old International Order, which is in stores today.

Read an excerpt below or check out the entire interview.

Sean Speer

Canada increasingly finds itself stuck in the middle of a great power rivalry between its first and second largest trading partners. The consequences of that have manifested in various ways including the unlawful detention of two Canadians in China, the increasing unreliability of our bilateral relationship with the United States and so on.

If you were advising Canadian policymakers about how best to navigate the new world that the book outlines, what would your advice be? How should Canada position itself if we are indeed on the cusp of the end of the international order?

Thomas Wright

It’s a great question. I think Canada has a very strong interest in a robust response by like-minded countries on doing more to provide global public goods, especially in pandemic preparedness, but also in a number of other areas. We are currently coming up short at the G7.

Take global vaccinations. There were 870 million vaccines committed to developing countries, but that’s much less than even 10 percent of the estimated 11 billion vaccines that are required, according by the WHO. I worried that there’s was a lack of urgency, particularly in the United States and the EU, possibly because of the size and significance of the affected countries. So, I think that Canada, Australia, Japan, and others have a vital role to play in underscoring these issues and stepping up to the mark.

One other point on China: Canada has had a very grueling experience with China over the last few years. There is a shared interest amongst democracies to stand up for the freedom of speech, the right to be able to criticize, for human rights and other things. I think Canada and Australia must also have the right not to be coerced by a larger power. Canada has an extremely important role in shaping how we affirm and the get control of the situation, and don’t allow it to deteriorate further.

8:30 a.m. — Trudeau promises to build or repair 1.4 million homes over four years

Liberal leader Justin Trudeau was in Hamilton this morning promising to build, preserve or repair 1.4 million homes over four years to ease housing affordability issues in the country.

Trudeau’s promise is similar to a recent Conservative pledge to build a million homes over the next three years, with both parties looking to tackle the supply side of Canada’s housing shortage.

The Liberal leader also promised to double the first-time home buyers tax credit, create a “rent to own” program and create a Home Buyers’ Bill of Rights, which will ban blind-bidding. The plan will also ban foreign nationals from buying homes in Canada for two years.

Trudeau also introduced “first home savings accounts,” which will allow Canadians under 40 to save up to $40,000 tax-free towards their first home purchase.

7:00 a.m. — Where the leaders are today

Liberal leader Justin Trudeau will be in Hamilton to make a housing announcement at 8 a.m.

Conservative leader Erin O’Toole will be in Ottawa to make an announcement at 10:00 a.m.

NDP leader Jagmeet Singh will be in Mississauga to make an announcement on long-term care at 10:30 a.m.

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