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President-elect Donald Trump attends the 2024 Senior Club Championship award ceremony at his Trump International Golf Club in West Palm Beach, Florida, back in March.
Don’t Panic: 4 Rules for Responding to Trump Threats
Amid all the geopolitical chaos, the best advice of the year: Don’t panic.
As they dined at Mar-a-Lago on a main course of tough, over-cooked tariff talk, President-elect Donald Trump suggested to Canadian Prime Minister Justin Trudeau — in what the Canadians present later called a joking manner — that Canada might make a good 51st state. Naturally, people freaked out. First, Trump threatens to destroy the Canadian economy with 25% tariffs on everything, and now this? An invasion?
As the breathless coverage spilled over the international media, my colleague Gerry Butts went on Bluesky with a message: “Trump used this 51st state line all the time with Trudeau in his first term. He’s doing it to rattle Canadian cages. When someone wants you to freak out, don’t.”
It is sound advice. Don’t freak out.
Canada is no more going to become the 51st state in the next four years than California, British Columbia, and Oregon are going to break away and become Cascadia. Jokes are not policy.
So what’s up?
Trump is a zero-sum negotiator. He uses the powerful leverage he has to create “I win, you lose” deals. Threats give him a real negotiation advantage before the actual negotiations happen. That is the prerogative of the Big Dog countries, especially those run by strongmen, mercantilist leaders like Trump. Trump threats are simply the expected prelude to any deal. But what is real and what is rhetoric? And how to respond?
Invasion: Rhetoric. Dismiss.
Tariffs: Real. Discuss.
Rule One: Stick With Facts. Don’t get caught up in the torrent of tweets and taunts. Don’t give anything away until the actual negotiations start. Facts are your best friends.
Facts? Really? You might think that since Trump has ushered in the post-fact world, facts are a diminishing currency. That is a dangerous bet. For example, at the root of the 51st state jab are the much more dangerous Trump threats to slap 25% tariffs on all goods coming in from Canada and Mexico. Trump based this threat on what he says is the heavy flow of fentanyl and illegal migrants across the border.
Initially, that threat caused panic. Alberta Premier Danielle Smith immediately went into appeasement mode, telling the CBC’s Power and Politics, “It’s incumbent, I believe, on the federal government, along with all of the provinces, to work together to address those concerns if we want to be able to avoid these devastating tariffs that’ll hurt all of us.”
She’s not wrong that the Trump rhetoric needs to be addressed, which is why Trudeau immediately got on a plane and took his team for a strategic schmooze fest at Mar-a-Lago. Trump prizes personal relationships above all else, so a connection matters.
Rule Two: Don’t Take It Personally. Even though Trump has a long-standing sour relationship with Trudeau — he’s even called the Canadian PM “two-faced” — in Trumplandia, that doesn’t matter. His relationships with people change like the weather in the Rocky Mountains: If you don’t like what is happening, wait five minutes. It will change.
Trump is quick to anger and quick to forget. Can he get over his past irritations with Trudeau? Well, he got over JD Vance comparing him to … that guy who ran Germany in the war. He nominated former rival Marco Rubio, whom he used to mock as “Little Marco,” for secretary of state. Trump doesn’t hold the very grudges he creates, and the best way to get over that is to find a way to make nice, show loyalty, and suck up. That’s what the Trudeau visit was all about. Feelings first. Facts second.
That doesn’t mean giving anything away. And that’s where the facts come in. On fentanyl and border security, the reality is far different than the rhetoric. Canada is hardly a major threat to the US on either issue.
“The facts are hard to deny,” Kirsten Hillman, Canada’s whip-smart ambassador to the US, pointed out on X. “Last year, 0.6% of illegal crossings and 0.2% of fentanyl seizures by US authorities were at the northern border.”
That’s right. Only .2% of fentanyl seizures happened at the Canadian border. If you want to go deeper, check out the latest stats from the US Customs and Border Protection agency, which shows that the problem of fentanyl is largely at the Mexican border, not the Canadian one.
In fact, the CBP’s top official, Troy Miller, has an extensive interview on the US government website about fentanyl coming over the US border. Guess what? He mentions the southwest border 21 times and Mexico specifically seven times. Canada? Not a word. Canada and the northern border are not mentioned a single time. Why? It is simply not a major issue.
Rule Three: Know What Actually Needs Work. On the other hand, illegal migration is a real issue, both internationally and domestically. There is a key section along the US-Canadian border called the Swanton Sector (which covers parts of New York, Vermont, and New Hampshire), and illegal immigration rates there have spiked according to stats from the CBP. But how bad is it? 23,000 arrests were made at the northern border between October 2023 and September 2024. That is up from 10,000 in 2023. Compared to Mexico, where over 47,000 arrests were made in November of this year alone, it’s a trickle (700 were arrested in November in Canada). Still, politically it is an issue Canadians will have to deal with if they want to avoid tariff punishments. Doing nothing is not an option.
Illegal migration is now driving election outcomes in France, Ireland, Germany, and many other places, so this ain’t a surprise. But proportionality matters, and the facts that prove that point can get lost in the storm of threats. It is critical this doesn’t happen.
Rule 4: Follow the Money. There is a high probability that a tariff-driven trade war — or skirmish — is coming very soon, and the facts here will be crucial. After all, high tariffs will hurt the very people Trump represents — namely, American workers. High US tariffs on Canadian goods will raise prices for US consumers and make life for them more miserable. That is a political loss for Trump.
Over 34 US states rely on Canada as their major trading partner, so expect state governors to pressure the White House to ease up on the tariff talk so as not to jeopardize the bilateral trading relationship that sees over US$2.7 billion worth of goods and services crossing the border each day.
To protect that, Canadian leaders will have to think hard about decoupling their trade relationship with Mexico, especially when the new US-Mexico-Canada trade deal gets renegotiated in 2026. The politics of the southern border have always cross-infected the northern one, but if the infection threatens to be economically fatal, there will be a change. The famed three amigos might be reduced to two.
But that is not for right now. Trade deals are not made on social media; they are negotiated face to face, when genuine swaps and deals can happen. Better to build relationships now over dinner, and serve up facts for dessert.
And don’t panic.
It hasn’t even started yet.
Trudeau’s former right-hand man thinks Trump 2.0 ‘will be harder’
When Donald Trump shocked the world by getting himself elected in 2016, Gerald Butts was the principal secretary to Canadian Prime Minister Justin Trudeau. He was also a key member of the Canadian team that managed the tumultuous but ultimately successful negotiation of the USMCA, sitting across the table from Trump, Peter Navarro, Steve Bannon, and Robert Lighthizer. He is now vice chairman and a senior advisor at Eurasia Group, which is the parent company of GZERO Media.
This interview has been edited for length and clarity.
You were in the Office of the Prime Minister the last time Trump was elected. How is this different?
Butts: On the positive side, it’s not as much of a shock. The most salient fact of the first Trump presidency was that it happened. So everybody had to have a plan for it happening again. That’s the upside. The downside is you’re going to be dealing with a much more emboldened Trump who’s got a broader electoral mandate and whose ambitions on the economy are much more comprehensive than they were the first go-round. He campaigned in 2016 basically saying to the Great Lakes blue-collar worker that he was going to bring their jobs back from Mexico, the jobs that the Clintons sold to Mexico. And this time he’s got a much more ambitious agenda. It’s rebalancing global trade and a mass deportation plan that will make labor more expensive in the United States.
If you add those two things together, along with probably increased defense spending on an already large deficit, it’s hard to see how those things don’t cause inflation.
It seems odd that inflation is what eroded Biden’s brand, but Trump’s two key promises are both inflationary.
They don’t see it that way, of course. I think that that’s the conventional economic view. And I do think that what will inevitably be an inflated defense budget beyond the PBO’s 3% estimate is also going to be part of this, part of the inflationary pressure that Trump brings to bear.
As policymakers have learned over the past couple of years, because most of them had never had to deal with it before, inflation is a government killer. It’s the grim reaper for incumbents, and it’s mowed down governments of all political stripes all over the world.
Speaking of which, the Trudeau government generally gets good marks for handling Trump the first time, which you had something to do with. A lot of people are worried that it’s going to be a little harder this time, in part because of the relationship between the president and the prime minister. Do you think that that’s important?
Its importance is overblown. I think you’re right that it will be harder. I think that has more to do with the relative political standing of the government and the time of the mandate. If you’re dealing with Trump at the end of your first year, when you’re in the 40s in the polls, with almost a 50% approval rating, that’s one thing, because those two things add up to political capital that you have to invest.
If you’re dealing with it in year 10, when you don’t enjoy those polling numbers, that means you have less political capital to invest. And by definition, Trump is a problem that requires political capital to solve.
They have a very difficult task ahead of them, don’t they?
They really do. I never like to tell my former colleagues how to do their job, because the truth is, when you don’t have all the information they have, it’s hard to make judicious calls. Only they know how prepared they are to deal with undocumented people showing up at a Canadian border point. I don’t know that. Unless you do, it’s hard to say how you would deal with that issue either in the public or in bilateral negotiations with the Trump administration.
I do think that’s potentially the biggest problem they’re going to have to deal with because I wouldn’t say the cross-partisan consensus on immigration in Canada is gone, but it has been weakened by recent events.
On trade, what’s the best guess on whether Trump is going to exempt Canada from a new tariff policy?
I think if the best predictor of future behavior is past behavior, then he will only grant exemptions in return for something. The question is, what can the government offer that he wants that will get that exemption? And I have no idea.
Cross-border trade is high frequency and very large. We’d feel the impact of tariffs sooner, and they’d cover more of our economy than any country except maybe Mexico.
Traditionally in Canada, all governments are afraid — because of the strength of our dairy lobby — to do much about the supply-managed dairy industry. (Canada’s politically powerful dairy farmers have long exerted political pressure to protect their industry from American imports.) In this situation, do you think that that’s the kind of thing the politicians may have to think about in a new way?
That’s definitely possible. I mean, my view is if you’re going to take that kind of risk, get some bigger economic reward for it. We’ve been simultaneously having this conversation yet again about Canadian productivity. And one of the big problems with Canadian productivity is that our firms and sectors like digital services face no competition. So the companies are big, bloated bureaucracies that deliver some of the most expensive services in the world. I’d be tempted to use the crisis presented by the Trump administration to fix some things about the structure of the Canadian economy that badly need fixing.
On the energy transition, all of these big bets on battery plants in the United States are legislated tax credits that Trump cannot get rid of, but the whole managed auto manufacturing sector is losing an enthusiastic ally for EVs in Biden. What does that do to the enormous subsidies Trudeau and Champagne have put on the table for EV manufacturers?
I think that may be literally a trillion-dollar question. That’s going to be a super-challenging file to manage with Trump. It’s coming at a time where the global industry is electrifying, and that process is being led by the Chinese. The Americans think the proper response to that is to create large tariffs that will keep the Chinese out of the American market because they’re kind of running the 1970s playbook. I think the response from the Chinese is going to be: “We don’t need to be in the American market. China is twice the size of the United States auto market, and we’ll take the rest of the world while you guys double down on inferior technology that the rest of the world is turning away from.”
It’s a very complicated situation. They’re already losing out to Chinese and Korean producers, and this could just accelerate that process.
So I’d be very worried if I were working on this part of industrial policy in North America because the companies have a weaker hand to deal with than the government seems to think they do.
And for Canada, there’s an extra challenge in that the Canadian economy is so integrated with the American economy that it may not be possible to set a different course.
That’s right. It may be that the American automotive market, like the American economy itself, is so large that subnational economies like California and New York — which together are larger than Canada — can keep going the way they’ve been going, and the Canadian industry basically follows them. But I think that’s challenging. It’s super challenging for a small but important producer like Canada, especially on the parts side.
Let’s close with a little optimism. What do you see as an upside of this election for Canada?
I think it’s the persistent structural problems in the Canadian economy that are not going to be solved in the absence of a crisis. Maybe Trump is the crisis that the Canadian economy needs to solve those problems.
Canada's Prime Minister Justin Trudeau rises to speak during Question Period on Parliament Hill in Ottawa, Ontario, Canada September 18, 2024.
Will Canadians head to the polls early?
Rumblings of an early election are growing in Canada. Earlier this week, the Liberal government lost a byelection in Montreal, dropping a safe seat to the Bloc Québécois that they won by 20 points in 2021. Meanwhile, the New Democratic Party held on to a seat in Winnipeg, a contest in which the Liberals — never particularly popular in the riding — managed to grab less than 5% of the vote.
Nationally, the Liberals are down roughly 20 points in the polls to the opposition Conservatives, who plan on holding a vote of non-confidence in the government next week. If the NDP and BQ choose to side with the Conservatives, the government would fall immediately, and Canadians would head to the polls.
The BQ, however, has said it won’t back the motion. But the Conservatives are planning on more of them in the future, and the NDP and BQ could change their tune fast if they feel the government isn’t delivering on concessions they want.
Though the NDP and GQ have signaled they’re in no rush to trigger an early fall election and would rather review matters on a case-by-case basis, Graeme Thompson, a senior analyst with Eurasia Group’s global macro-geopolitics practice, says one is now more likely than before.
“All three opposition parties can plausibly expect to improve their position at the expense of the Liberals if an election is held sooner than later,” he says. “So their incentives are aligned in that respect, even though there are other factors mitigating against a fall campaign.”
Liberal leader Justin Trudeau and NDP leader Jagmeet Singh take part in the federal election English-language Leaders debate in Gatineau, Canada, September 9, 2021.
Conscious Uncouplings: Why Political Alliances Don’t Last
Breakup alert, breakup alert!
No, this is not another report on Bennifer — the perpetually entropic relationship between Jennifer Lopez and Ben Affleck.
And no, it is not another story about the Democrats-Biden breakup, though that still resonates as the blockbuster Kamala Harris vs. Donald Trump debate tilt gets going next week.
No, this is about the big breakup in Canada that sets the clock ticking on the next federal election, which by law has to take place before Oct. 20, 2025. The only question is, how soon will it come?
It used to be that political breakups were a sign of things falling apart for a party, but after the Dems ditched Biden at the altar, they’re suddenly living their best lives with Harris, with money pouring in and momentum in the polls. Breakups have been rebranded as ... creative destruction. We had to destroy the leader of the party to save the party!
Democrats believe their shotgun political marriage with Harris and Tim Walz will prove long-lasting — and not end up like some crazy night in Vegas, where they wake up with a wedding ring and a face tattoo, reliving the electoral version of “The Hangover.” What the heck did we just do? But for now, no one there has any doubts: The change has been very good for them.
Which brings us to Justin Trudeau, who yesterday got ditched by his lefty bestie, New Democratic leader Jagmeet Singh. For those of you not following the machinations of Canada’s parliamentary democracy, here’s the quick background:
After Trudeau won another minority government in 2021, he needed the support of another party to stay in power. He craved some stability and got it when he struck an unusual deal, called a “confidence and supply” agreement, with the NDP — the further-left-of-center fourth-place party. It wasn’t quite a coalition — no NDP member was in Trudeau’s cabinet — but rather more of a friends-with-benefits arrangement. The NDP agreed to keep the Liberals in power until 2025 in exchange for passing progressive policies like dental care and Pharmacare, which the Liberals finally did.
All that ended yesterday. According to reports from the CBC, Singh didn’t even dump Trudeau in person. At 12: 47 p.m., he informed Trudeau’s office that he was ending the deal. A mere seven minutes later, Singh released his now-famous breakup video. Ouch. Breaking up by video is modern, I guess, but it’s barely a step above ghosting someone. This was straight out of a “Mean Girls” script, but such is the nature of politics.
“Justin Trudeau has proven again and again he will always cave to corporate greed,” Singh said, hinting at things like the back-to-work legislation the Liberals recently passed to avoid a strike at CN rail, which could’ve wound the economy. “The Liberals have let people down. They don’t deserve another chance from Canadians,” Singh said, trying to distance himself from the very government he propped up so enthusiastically for years.
Why now?
First, the Liberals are so unpopular that the deal to support them has outlived its usefulness and become a liability. And for all their talk about taking credit for the Liberals' progressive legislation, the NDP has never benefited from working with the Liberals anyway. “The NDP has been polling around 17 to 19% now for over a few years,” says CEO and chair of Abacus David Coletto. “But the Liberal drop hasn’t translated into any net gains for them.”
Putting a barge pole between the NDP and the Liberals is important for Singh, who is being cross-contaminated by Trudeau’s unpopularity. “86% of Canadians want change,” Coletto told me. “It’s hard to be that change when you’re being held responsible for propping up the government and prime minister Canadians want to change. So it was inevitable the NDP would need to make a clear break from the government.”
Second, Singh believes the Liberals are at an all-time low and this moment may be the best time to beat them again, as they once did in 2011 under then-leader Jack Layton, who surfed on an orange wave that brought the NDP to official opposition status for the first time.
Still, the math is tricky as the NDP are stuck in the same pollster Hades as the Liberals. “There’s no reason from polls that they should want an election unless they believe we have hit the bottom of Liberal popularity,” says Coletto.
Every opposition party in Canada wants to run against Trudeau because they see him as deeply vulnerable. The wheel of change is turning. The big question: Will waiting to call an election give Trudeau time to leave and allow a new leader — Kamala Harris-like — to arrive and revive Liberal fortunes?
Third, with crucial provincial elections in BC and Saskatchewan and two key by-elections on Sept. 16 happening, the NDP needs to look like leaders, not junior partners, if they want to be taken seriously,so they can’t look too close to the Liberals. “New Democrats are working to take on the Conservatives across the country,” says Kathleen Munk, a longtime NDP strategist and Layton’s former communications director. “But that is harder to do so with one hand tied behind your back.”
Now what?
This does not mean the Liberal government will fall. The Conservatives will certainly try to test Singh’s commitment to change by calling a non-confidence vote, likely later this month, but I don’t see the NDP taking the bait right away. Instead, they will now function on a vote-by-vote basis as most minority parliaments have done, and likely prop up the Liberal government until the new year.
That’s why this is not a real breakup but more of a conscious uncoupling, a strategic way to look independent without letting the government fall and allowing the heavily favored Conservatives to swoop into power. “No question creating some daylight between them and the dark shadow of the Trudeau Liberals is politically advantageous,” says Munk. “The NDP need to make sure New Democrat voices are heard, clear of the noise coming from the Liberals.” This deal break is more like moving out of your parents’ house but still having them pay your rent and do your laundry.
The Conservatives are baiting Singh to take down the government, but insiders know not to hold their breath. “Like any good breakup, separating takes time,” says Tim Powers, founder of Summa Strategies and a longtime Conservative strategist. “You can say you aren’t together, but that usually only becomes true when you can be seen to be moving on. In this case, voting against the Liberals on a confidence motion would definitely be the case. But hard to see a set of scorned lovers here given the dog’s breakfast of polls that benefits only the Conservatives.”
If there is no immediate federal election, is this just a case of “Singh and the Fury” signifying nothing? In the short term, yes, but it has accelerated the likelihood of a federal election, even as the NDP uses this time to try to rebuild. It also forces Trudeau to decide whether he wants to run again or step aside. If Trudeau loses that critical Sept. 16 by-election in Montreal in what should be the safe seat of his former justice minister — and polls show it is a toss-up right now — his party will find its inner Nancy Pelosi and start a conscious uncoupling on its own.
Political alliances never last long, and minority governments in Canada usually have a shelf life of about two years. An election is overdue, and this deal was never going to last until 2025. But the notion that some kind of Kamala Harris-like creative destruction of the Liberal-NDP alliance will stop the Conservatives, who are 20 points ahead and cruising, is a hope, not a strategy.
Voters want change, for sure, but more than a change of strategic arrangements, they want a change in results. For a government that has been in office for as long as the Liberals, better results on home prices, inflation, and the cost of living might be the only thing to keep voters from executing a conscious uncoupling at the ballot box.
President of the United States Joe Biden and Prime Minister of Canada Justin Trudeau during welcome ceremony of the NATO Summit in Washington DC, United States on July 10, 2024.
US escalates opposition to Canada’s digital services tax
Last April, Canada confirmed that it was going ahead with a digital services tax, retroactive to 2022, on big tech firms with annual revenues above CA$20 million. A tax had been in the works for years as a multilateral effort among OECD countries, but it’s been stalled time and time again by the US. In the face of US opposition, Canada decided to go it alone.
The Biden administration argues the 3% tax unilaterally pursued by Canada unfairly targets US companies. It has requested trade dispute consultations with Canada, calling the measure “discriminatory” and alleging it violates the country’s free trade agreement by treating Canadian firms differently than their American counterparts.
The dispute consultations could take months and, if not resolved within 75 days, could lead to a dispute settlement panel that will arbitrate the matter.
In response to the tax, Google has levied a 2.5% ad surcharge, effectively passing the tax along to Canadians firms that may pass the cost along to consumers.
The Canadian business lobby is warning that the tax could provoke a trade war with the US. But the Liberal government of Justin Trudeau is not backing down, reiterating that it will keep the tax that it promised back in 2020, setting up a showdown with the US and tech giants ahead of the 2025 Canadian general election.
Chinese President Xi Jinping and Canada's Prime Minister Justin Trudeau pose for a family photo during Asia-Pacific Economic Cooperation (APEC) CEO Summit in San Francisco, California, U.S. November 16, 2023.
Waiting for Beijing to lash out
Canadian trade officials are anxiously waiting to see how China reacts to Canada’s decision to impose 100% tariffs on Chinese-made electric vehicles. Prime Minister Justin Trudeau announced the measure during a cabinet retreat in Halifax on Monday. In a briefing in Beijing on Tuesday, a Chinese foreign affairs spokesman said Canada must “correct this wrong decision at once,” or China will respond.
Canada imported CA$2.2 billion worth of electric vehicles last year – mostly Teslas manufactured in China – up from less than $100 million in 2022. Tesla may be able to shift its manufacturing to avoid the tariffs, but Chinese EV manufacturers can’t get around the trade barriers so easily. BYD, one of the biggest brands, sold three million electric vehicles last year, overcoming Tesla as the world’s biggest EV manufacturer. The Chinese appear to be ready to outsell Western competitors, but only if they have access to markets.
Canada, which lacks America’s clout with China, faces greater possible difficulty with Chinese countermeasures but must keep its policy aligned with Washington’s to keep access to the crucial American market for Canadian auto and parts manufacturers. Both Canada and the United States have built an industrial strategy around subsidies for domestic EV manufacturing, but environmentalists point out that this will reduce emission reductions more slowly than just allowing for the import of cheaper Chinese vehicles.
However, the tariffs ought to allow North American manufacturers to compete, protecting jobs, which progressives hope will help maintain political support for reducing emissions.
Harris breathes new life into Democratic Party. Could someone do the same for Canada’s Liberals?
When President Joe Biden announced on Sunday that he would not seek reelection, his decision, albeit a little late, was quickly applauded by Democrats as a service to his country — and party.
In the higher-minded rhetoric, Biden was cast as a modern Cincinnatus, putting duty above personal interest. Perhaps the writing was already on the wall, with Biden unlikely to resist the growing calls for him to step aside. But the immediate effects of his decision are the same either way: Vice President Kamala Harris is now the presumptive Democratic presidential nominee, an energetic change candidate, and the party has enjoyed an immediate reenergizing.
After Biden dropped out, the Dems raised an astonishing $150 million from big donors, as well as $81 million from small donors in a record-breaking 24 hours. As many joked on X, Harris outgrossed “Twisters” in her opening weekend. Of note, much of the money came from smaller individual donations of $200 or less — 888,000 of them, in fact.
The Harris campaign immediately rallied tens of thousands of volunteers, hitting 28,000 by Monday, many in battleground states. Scripps News reports that’s 100 times greater than the campaign average. A Zoom call with Black women who support Harris drew 44,000 participants — a staggering number that exceeded the company’s limit of 1,000 people and required it to move the group to a webinar.
The energy boost Democrats are enjoying may have Canadian Liberals wondering if a similar outcome might be possible for them. Prime Minister Justin Trudeau insists he’s staying on as leader, readying to fight in the fall 2025 election despite being roughly 20 points behind Conservative leader Pierre Poilievre. By the time the vote rolls around, Trudeau will have been in power for a decade.
Trudeau has been asked to step down by a few notable sources within his party, but the pressure to leave hasn’t risen to the level Biden faced. That could be because the election is still more than a year away, or because Poilievre doesn’t present the existential threat to democracy and rights that Dems say Trump poses. Liberals may also think that for all their misfortune, they could still turn things around and that Trudeau is their best bet for doing so. But things don’t look great.
Election projection site 338 Canada’s Philippe Fournier projects the Conservatives will win 212 seats compared to 74 for the Liberals. That’s based on a popular vote projection of 42% for Poilievre’s side compared to 24% for Trudeau’s, a spread that reflects federal polls that routinely find the Conservatives ahead by 14 to 20 points or more. Trudeau’s approval rating, meanwhile, has sunk to all-time lows.
The Conservatives are leading their rivals in fundraising by a lot. In the first three months of 2024, the party brought in just under CA$11 million from 51,000 donors, which was triple what the Liberals managed and more than all opposing federal parties combined. Political donations in Canada are a fraction of what they are in the US, but the Conservative numbers are high for the country. In 2023, Poilievre broke records with roughly 200,000 donors pledging over $35 million. The Liberals managed $15.6 million.
As bad as things look for the Liberals, however, there doesn’t seem to be much hope that anyone else could turn the Liberal campaign around like Harris looks poised to do in the US.
“There’s pretty good data to suggest that when incumbents are replaced by a successor [in Canada,]” says Graeme Thompson, a senior analyst with Eurasia Group, “the successor has much lower chances of reelection than the original incumbent, especially when that original incumbent’s poll ratings are below a certain threshold where they’re doing pretty poorly.”
Perhaps the most infamous example was in 1993, after Progressive Conservative Prime Minister Brian Mulroney stepped down amid plunging poll numbers and was replaced by Kim Campbell. The PCs lost that election to the Liberals, dropping from 156 seats to two.
The United Kingdom’s recent election is further evidence of the phenomenon. The unpopular Conservatives dropped to 121 seats from 365, losing control of the government to an ascendant Labour Party after roughly 14 years in power — and after cycling through five prime ministers.
Thompson says it’s unlikely there’s anyone in the Liberal Party who could replace Trudeau and turn the ship around. Those within Trudeau’s Cabinet are tied to his government and record, painted with the same brush. And those outside the party would face their own challenges, including time.
“Somebody would have to come in and distance themselves from the government here up to this point," he says, "and embrace a set of policies and a style which would have to be very different.”
“I don’t think that just putting a new coat of paint on the same sort of decrepit structure is going to change the fundamentals. You would really have to be a new government, and that’s going to be very hard for somebody who has been a member of that government up to this point who doesn’t have a long runway to prepare that pivot or transition.”
Thompson also points out that for external candidates, like former Bank of Canada and Bank of England Governor Mark Carney — with whom sources say Trudeau recently met in a bid to get him to join his government — there are few if any incentives to hop on a sinking ship. Moreover, no replacement candidate of Harris’ caliber seems ready, willing, and able to serve.
The numbers bear out that analysis. A recent Nanos poll found that while 19% of respondents chose Carney as the most appealing Liberal leader, followed by Finance Minister Chrystia Freeland at 19%, and Trudeau himself at 9%, a quarter chose “None of the above” and another 20% chose “unsure.”
Harris may be able to continue to inject life into the Democratic Party. She may have a real shot at turning the Democrats' campaign around. But she still has to prove she can stand up to Trump on the national stage.
It doesn’t seem that anyone can — or wants to — do the same for the Liberals, which means Trudeau looks likely to stick around, go down with the ship, and leave the reinvigoration and rebuilding to a successor, who’ll find themselves not on the government side but in the opposition seats.
Canada’s Prime Minister Justin Trudeau and Manitoba Premier Wab Kinew shake hands as they meet at the Manitoba Legislative Building in Winnipeg, Manitoba, Canada February 15, 2024.
Left-leaning premier calls for increased military spending
Prime Minister Justin Trudeau faced new pressure Wednesday from an unusual source to increase defense spending, when Manitoba Premier Wab Kinew said Canada should boost spending to preserve its trade relationship with the United States.
Kinew, a member of the left-leaning New Democrats – a party that is traditionally opposed to increased military spending – said, “If we’re not meeting our responsibility to our NATO allies, it is going to have an impact on [the Canada-United States-Mexico Agreement] renewal.”
The trade agreement is set to be reviewed in 2026, which will create the opportunity for the United States to push for changes, which seems likely no matter who is in the White House, since the pressure from the U.S. dairy industry, among others, is likely to persist.
During a NATO summit in Washington last week, under pressure from US politicians, Trudeau announced that Canada will hit the NATO target of 2% of GDP by 2032, and buy a new fleet of submarines, but he has not laid out a plan for doing so. Back in Canada after the summit, Defense Minister Bill Blair said it would amount to about CA$60 billion a year in spending, which economists would require significant cuts or spending increases.
Traditionally, defense spending has not been a vote winner in Canada, but if opinion leaders are increasingly seeing it as linked to the vital trade relationship, that may be changing.