Thread by @MaritimerinE

A *lot* is happening right now in world politics but I want to focus in on what Chrystia Freeland has been up to and why everyone should be paying attention to her right now. A long 🧵

Chrystia Freeland has very publicly blown up Canada and the Liberals’ veneer of credibility on climate action and heel-turned the government into a very conservative fiscal agenda. I think this will take some weeks to be fully absorbed by the media and political system… 1/

…and still longer to penetrate the depths of the Twitter discourse. But this is a hugely significant moment in the life of this government. /2

Freeland is a good politician and she knows not to let a crisis go to waste. Europe is in for a very hard, cold, expensive winter, and she is using that and the war in Ukraine to shift the Government’s agenda in a major way. /3

Specifically I’m talking about:
a) promoting accelerated resource development at the expense of “domestic political capital”. New energy projects have stalled under Trudeau’s wishy washy environmental agenda. Freeland is signalling an entirely different approach. /4

b) a Cold War division of the world into good guys and bad guys. Anyone confused about why this is terrifying should listen to Blowback. Freeland has been a cold warrior since she was a teenager. As foreign affairs minister she supported the attempted coup by Juan Guaido in 🇻🇪/5

…and the successful coup government of Jeanine Àñez in 🇧🇴. The war in Ukraine has provided the perfect cover for her to go all in on a new Cold War when what we need more than anything is peace. /6

c) tightening fiscal policy and austerity. Freeland has made it clear, as finance minister, that any new initiatives will need to be funded by cuts to existing programs. She also told auto manufacturers this week that there will be ‘difficult days ahead’ economically… /7

There will likely be a recession, but the economy is running red hot right now, which is driving record profits and also inflation. We’re also at full employment and there is a major supply chain crunch for industrial inputs and an intense labour shortage. /8

New corporate taxes would be the appropriate fiscal solution to this problem, but that’s untenable for Freeland’s core audience so it’s not going to happen and we’re going to get austerity instead (which will just lead to more unemployment and higher corporate profiteering). /9

Why is Freeland doing this? Her audience is not the Canadian electorate, but instead the kingmakers of the Liberal party. Elite faith in Trudeau is at an all-time low and she’s shoring up a base of support among the industrial, military-industrial and petro-finance classes. /10

She’s telling them: we’re going to accelerate your investments, with government support and $, we’re going to help wage the war of Ukrainian self-defence, we’re going to create unemployment to lower your labour costs, and we’re not touching your record-breaking profits. /11

She’s also shoring up support in international finance by imposing strict spending controls (remember the government is currently running a surplus due to inflation), and western geopolitical/NATO support via promises of weapons and energy. /12

That’s my analysis. Here’s my speculation: she is trying to blow up the NDP supply and confidence agreement. The government has committed to a number of things that are untenable under Freeland’s newly articulated policy agenda. /13

These include massive spending on a new dental care program (which now needs commensurate cuts in order to be funded) and ‘early moves in 2022’ to phase out public financing of the fossil fuel sector (which contradicts her statements about producing MORE Canadian energy). /14

If they have any sense, the NDP sees this and are starting to sweat. They’re going to have to put their foot down to press this agreement or risk losing all credibility. /15

If they do so and that agreement fails, the range of political possibilities opens up in a major, major way. We could see an election much before 2025, and we could see significant fractures within the Liberal party. /16

None of this is good. Political instability will mean less attention paid to the already-forgotten-about-and-still-raging pandemic, and shift focus and political capital into the immediate term at the expense of longer term crises like housing, affordability and climate change/17

Not to mention that Freeland’s political agenda itself is bad, will withdraw support to struggling families and workers, drive up the cost of living, generate unemployment and further imperil the climate and geopolitical stability. We are in for a rough winter folks. 18/18

Addendum: this will come to a head in February or March when the Budget is tabled. No clue what that will contain but the signals are that it’s going to be a huge departure. The NDP will be forced into a decision then on whether they follow through on the vote to support the gov.

This is the basis of the supply and confidence agreement. The NDP votes for Liberal budgets in exchange for some concessions. Without those concessions, it will be Jagmeet Singh’s call and his entire credibility will be on the line.

This will be the first budget in a minority Trudeau government where the NDP has *clearly* articulated what their demands are. That means Jagmeet won’t be able to weasel through with tepid support in exchange for empty promises. His demands are inked and public.

. @wickdchiq @David_Moscrop @NoLore I would welcome your takes on this analysis.