Will Trudeau's next budget reduce his trust deficit?
Canadians are skeptical about Justin Trudeau’s ability to table a budget that will deliver results. Will he be able to change their minds?
Next week, Canadian Prime Minister Justin Trudeau will present a make-or-break federal budget for his governing Liberal party. The federal budget is politically important because it puts money where a politician's mouth is on policy. So next week's budget will show Canadians how - or if- Mr. Trudeau intends to address the country's multiple high-profile crises.
And with only about 18 months left until a federal election must be called, this budget is Mr. Trudeau's last chance to course correct with time for results to materialize prior to Canadians casting their ballot. If Mr. Trudeau wants voters to see real progress on serious problems like Canada’s profound housing shortage, the skyrocketing cost of living, record rates of opioid addiction, generationally high crime rates, startlingly low economic productivity, and unsustainable deficit spending, his upcoming budget is going to have to be innovative, brave and apologetic for policy failures that happened under his watch.
So, the question on everyone's mind in Ottawa right now is, can Mr. Trudeau deliver a budget that overcomes Canadian’s deep skepticism of his ability to solve big challenges facing the nation?
The answer to that seems to be already taking shape. Perhaps in response to Finance Minister Chrystia Freeland's incapacity to communicate anything effectively, or previous budgets not giving the Liberals much of a bump in the polls, Mr. Trudeau has spent the last two weeks while the House of Commons was in recess pre-announcing several initiatives that will likely be in next week's budget.
Unfortunately, his recent announcements demonstrate a lack of awareness of three key issues driving Canadians' mistrust of Mr. Trudeau and his governing Liberal party ability to craft a workable federal budget.
First, polls have shown that few Canadians believe that Mr. Trudeau understands that many of the problems facing Canada have roots in his government's decisions, or that he's willing to take accountability for those decisions. Even the most apolitical person on the planet understands that if someone is unwilling to admit that a mistake was made, they are highly unlikely to reverse course on the pattern of behavior that led to the mistake happening in the first place. And Mr. Trudeau has not made a habit of acknowledging failure or changing course away from it.
A case in point for Mr. Trudeau came last week when he made odd comments about immigration policy impacting housing shortages in Canada while failing to acknowledge that it was his immigration policy to begin with. The same could be said for Mr. Trudeau's continued announcement of billions of dollars into programs with no timelines, deliverables, or metrics attached.
Which leads to Mr. Trudeau's second big budgetary trust problem: many Canadians are now willing to blame his deficit spending for their high cost of living. Even the Bank of Canada has stated that if Mr. Trudeau's upcoming budget continues to spend the country into oblivion, inflation will get worse. This knowledge, combined with the Liberal's dogmatic adherence to increasing their highly unpopular, ineffective, and expensive carbon tax, has meant that the announcement of new deficit spending for initiatives that might otherwise be popular is falling flat among voters.
That particular phenomenon is also likely due to Mr. Trudeau's third big budgetary trust problem: few Canadians believe that his government can deliver results. After eight years of government, when presented with a policy question, the standard Liberal response has always been to announce spending. However, much of this spending has yet to materialize into any discernible benefit for the average Canadian.
In fact, it’s pretty easy to argue that the opposite is true. The country has watched Mr. Trudeau balloon the size of government while failing to deliver on essential services like processing passport applications, becoming embroiled in massive misappropriation scandals like the one involving the ArriveCan app, and seeing critical metrics like new housing starts decrease.
Said differently, many Canadians now associate new spending announcements made by Mr. Trudeau with inevitable failure and waste, a higher cost of living, and Mr. Trudeau's desire to stave off an election by appeasing their coalition partners in the New Democratic Party's demands. So failing an admission of failure and significant structural reform within his government, it will be hard for Mr. Trudeau to convince Canadians that throwing more of their money into a system that hasn’t delivered for them in the past will somehow magically result in new and better outcomes.
Opposition Conservative Party leader Pierre Poilievre has responded to these issues with a pre-budget list of demands of his own. Among them is a request that Mr. Trudeau caps any new spending with a dollar-for-dollar rule (read: the government must find a dollar in savings for every new dollar of spending) in order to bring down interest rates and inflation. This shouldn’t be hard to do. Given the country’s inflation woes, an audit on the efficacy of program spending should have been done by the Liberal long ago. Spending that isn’t delivering stated results or functioning on cost efficiency principles should have been heavily scrutinized prior to the delivery of next week’s budget, and its proposals being reflective of those very basic operating principles.
But Mr. Trudeau has shown little, if any, desire to say no to continued spending for mismanaged or ineffective projects, or reduce his reliance on pouring new money into failed systems without first undertaking structural reforms to fix them. These are fundamental political failings that his caucus - and frankly, his coalition partners - should have been demanding that he address.
That’s because the livelihoods of millions of Canadians depend on Mr. Trudeau fixing the federal budget, and recent polls show they are in an unforgiving mood. If Mr. Trudeau can’t get it right, he and his ilk might soon have to face another type of budget - one without the salaries that comes with their present roles.