FREE three month
trial subscription!

Sean Speer: With the Liberals reduced to a regional rump party, is Canada’s long Laurentian reign finally over?

Commentary

Justin Trudeau speaks during a Liberal Party of Canada fundraiser in Ottawa June 10, 2024. Spencer Colby/The Canadian Press.

With files from Kiernan Green. 

Old political narratives die hard. It often requires ample time in the face of conflicting facts for them to gradually become undone.

One of Canada’s oldest political narratives is that the Liberal Party is the “government party” or the “natural governing party.” According to this long-standing axiom, it’s the only political party capable of commanding broad-based support across different groups and regions.

The narrative was correct for most of the twentieth century. Over 28 elections, the Liberals won 19 of them. They won an average of 43.5 percent of the popular vote over this period. The Conservatives averaged nearly ten percentage points fewer. The result is that Liberal prime ministers governed for 69 percent of the century.

The twenty-first century was supposed to be more of the same. People were talking about Paul Martin as a “juggernaut.” The Canadian Right was fragmented. The old Liberal trick of shifting Left and Right meant that the party had virtually no competition. They matched the Conservatives on taxes and spending, the New Democrats on compassion and identity, and defeated the separatists on national unity.

A lot has changed since the halcyon days of the start of the century. Stephen Harper’s efforts to unite the Right have clearly changed the political landscape. But a united Right is a necessary yet insufficient explanation for today’s political context in which pundits are now asking about the future of the Liberal Party itself.

The best explanation was first identified by leading pollster Darrell Bricker and Globe and Mail columnist John Ibbitson in their 2013 book, The Big Shift, in which they foresaw a shift of economic and demographic power from the centre of the country to the west. These trends, which must be understood in part as an exercise of self-selection, anticipated Liberal decline in the most dynamic and fastest-growing part of the country.

Their hypothesis has been more validated than not since the book’s release. In the 2015 election, the Liberals managed to pick up some seats west of Thunder Bay, but even at the time these wins seemed more like aberrations than a new political equilibrium. Since then, the party has bled support in the West.

This week’s byelection result in Winnipeg in which the Liberals ended up with less than 5 percent of the vote—among the worst by-election outcomes for an incumbent government in Canadian history—cannot be merely dismissed as a reflection of a deeply unpopular prime minister. It must be seen as a secular challenge for Liberal politics.

Today, the Liberal Party is for all intents and purposes a regional rump. A party with a smattering of support in the Maritimes and across the Via Rail corridor between Montreal and Toronto. The population density of this swath of geography means that the Liberals won’t necessarily disappear off the electoral map. But it does mean that they can no longer claim to have a national coalition or the capacity to form a representative government.

As part of their analysis, Bricker and Ibbitson famously coined the phrase “Laurentian elites.” Although definitions can always be a bit imprecise, it’s fair to say that at least in geographic terms, the Liberal Party is now the Laurentian Party: its centre of gravity is this narrow part of the country between Plateau Mount Royal and the Annex.

There are of course various factors behind these developments. It partly reflects the growing sophistication and salience of Conservative politics—particularly under Pierre Poilievre’s leadership. It’s partly a function of the growing polarization of our politics such that the old centrism of the Liberal Party feels a bit unmoored. And it’s partly a sign that big “L” Liberalism’s modern mix of corporatism, redistribution, and identity politics is finding a smaller and smaller audience these days.

In the coming days, the focus will no doubt be on the short-term consequences of the by-election results and what they mean for Prime Minister Trudeau’s own future. Losing a previously-held Quebec riding is therefore probably where most of the attention is placed. But the Liberal Party’s increasing isolation from Western Canada is a more significant long-term challenge for Liberal partisans.

It’s a sign that the historic notion of a natural governing party is over. And, if they don’t find a way to broaden their support outside of the Laurentian corridor, Liberals may find themselves in the “opposition party” of the future.

Sean Speer

Sean Speer is The Hub's Editor-at-Large. He is also a university lecturer at the University of Toronto and Carleton University, as well as a think-tank scholar and columnist. He previously served as a senior economic adviser to Prime Minister Stephen Harper....

Robert Kavcic: On a per-person basis, seven of Canada’s 10 provincial economies are weaker than they were five years ago

Commentary

Premier Tim Houston, Premier Wab Kinew, Premier Doug Ford, and Premier Francois Legault close the Council of the Federation meetings in Halifax, July 17, 2024. Darren Calabrese/The Canadian Press.

The Canadian economy is growing slowly as past interest rate hikes weigh and the job market softens. Real GDP growth is expected at a modest 1.1 percent this year, while labour supply rises at a brisk pace. That combination has lifted the unemployment rate to 6.6 percent, or 1.8 ppts above the cycle low. Most provinces are running at sub-potential growth rates and seeing per-capita output contract, while the disparity in economic performance across the country is relatively narrow.

British Columbia looks to post growth about in line with the national average through 2025 (Chart 1). The province carries the highest share of residential investment in the country, a sector that is still grappling with high mortgage rates.

Graphic credit: Janice Nelson

Alberta is expected to lead among the larger provinces with 1.6 percent growth this year, as firm oil prices support incomes and demographic inflows surge.

Saskatchewan should underperform slightly at 1.0 percent, while Manitoba’s diverse economy remains steady—these two provinces should benefit from favourable crop conditions.

Ontario’s economy is growing despite the real estate correction. Population growth is a massive 3.5 percent year over year, which is adding to consumer demand and residential investment. The consequence remains stressed infrastructure and high living costs. Real GDP is on pace to grow 1.4 percent this year, with scope to accelerate to 2.1 percent in 2025 as rate cuts are felt more broadly.

Quebec, however, has seen activity struggle, including swings around public-sector strike action. Growth is expected at 1.0 percent this year and a below-average 1.4 percent in 2025. Softer 2.5 percent population growth hasn’t been as big of a driver, nor as big of a stressor. The outcome of the U.S. presidential election could also have significant implications for Central Canada, and eyes will be on any changes in the trade file.

Atlantic Canada continues to grow at a solid clip, largely due to population growth—both from international immigration and interprovincial in-migration. Most of the region should see growth around prior-year rates in 2024 as residential investment and consumer spending hold firm.

Graphic credit: Janice Nelson

One takeaway for the group is that, while each provincial GDP pie is getting bigger, the slices (i.e., per-capita output) are getting smaller (Chart 2). Per-capita output has contracted across seven of 10 provinces over the past five years, a stark change from prior periods. Note that each period involved a major shock, be it the financial crisis (2008-13) or the oil boom/bust (2013-18).

This article was originally published at BMO.

Robert Kavcic

Robert Kavcic is a senior economist at BMO.

00:00:00
00:00:00