There’s a charming humility to a seasoned professional wryly admitting to human frailty, as when a green-jacket golfer aw-shucks his way out of missing a putt..But, it’s not the same when it’s the Bank of Canada governor telling a Senate committee ‘It’s not like we got everything right.’ Governor Tif Macklem went on to say a winter recession would ‘not be severe.’.Recession?. Tiff MacklemTiff Macklem .Not severe for whom, exactly?.As the bank governor well knows, a recession is when people lose their jobs and queues form at banks of another kind, those that give out food for free..They will be having a busy Christmas..How do we know that?.Well, another seasoned professional is already out there managing expectations..While introducing her November economic update Finance Minister Chrystia Freeland essentially told Canadians they were on their own: “We cannot support every single Canadian in the way we did with emergency measures at the height of the pandemic.”.She got that right..The very fact the Government of Canada paid millions of people to stay home in 2020 during the COVID-19 scare, doubled the national debt in the process, raised fuel taxes and sparked this inflation is why we’re in this national mess to begin with..Now, Macklem is obviously not a fool.. Chrystia Freeland at WEF .Nor is Minister Freeland, although that she draws inspiration from the World Economic Forum should concern Canadians..But very ordinary people who didn’t have economics degrees saw this coming. It’s not exactly a secret that when you pour money into the economy without increasing the supply of things to buy, prices tend to rise. And, if you borrow that money, you have to pay it back one day..They knew that when you put a tax on fuel, that price increase goes right through the economy because everything you buy, comes by a fuel-burning truck or train..So, people who knew only that much watched in horror as they first saw the Government of Canada borrow more money in two years than had ever been borrowed in the entire history of Canada through two world wars, a depression and a couple of recessions, all so that they could pay other people $2,000 a month to stay home..Second, they saw businesses ordered to close and stay closed..Third, they saw that in Trudeau’s Canada, climate change couldn’t wait and they watched as Trudeau hiked the carbon tax on fuels causing gasoline to go from 99 cents a litre to $1.70..And when it was revealed by Statistics Canada just before Minister Freeland’s update that some basic grocery staples had risen by as much as 30%, they shrugged and said, “We know.”.Macklem and Freeland knew as well..So why did they let it happen?.To be as fair as possible, not everything is within Canada’s control..However, ultimately, the problem was and remains leadership..In Justin Trudeau we have a prime minister who thinks budgets balance themselves and who has declared himself disinterested in monetary policy anyway. In other words, not only does he not understand, he doesn’t particularly care..He had alternatives during the pandemic — those places that avoided lockdowns did no worse than those that ordered people to shelter in place.But surrounding himself with people who lack wisdom, most of whom made their careers in anything but business and have never met payroll in their lives, the drama teacher turned prime minister defaulted to the easy route of borrowing, spending and daily photo ops..And while the Bank of Canada is supposedly arms-length from the federal government, you’re dreaming if you think the bank doesn’t pay attention to the federal narrative..Trudeau owns this..Just don’t expect any charming humility.
