The News Rundown
- China china china.
- China prior to the global pandemic was in our news cycle here at Western Context often from Meng Whenzhou and Huawei to the two Michaels still being held in China. Both of these issues have all but vanished in media coverage today.
- The media here in Canada has all but reiterated the news headlines coming out of China in relation to their supposed dropping cases of the Wuhan virus.
- China says they have no new reported cases of the virus but as China’s movie theatres began to re-open, over the past few days the movie theatres began to close up again.
- In speaking to the Hollywood Reporter sources said that the Chinese government is worried about a second wave of infections.
- China has an immense amount of influence in how the world and the media are treating the Wuhan Virus. Yesterday US President Donald Trump even tweeted that China was being very helpful to the US in combating the virus.
- Here in Canada, the CBC used the Communist Party of China’s language in labelling Taiwan as a province of China on a map showing outbreak locations.
- This was later revised after the CBC faced outrage online.
- In an article published in Macleans, Marcus Kolga argues that criticizing the Chinese government's handling of the virus is not racism.
- In a nutshell, authoritarian governments have a tendency to label their critics as racists of their country.
- We know China has tremendous influence in Canada from the lower mainland chain of nursing homes to an increased presence in Chinese companies to Huawei’s bid to control a significant chunk of our 5G infrastructure.
- The market dictates that the company with the best product at the best price should be used. This could very well be Huawei but governments must not pursue this blindly.
- They must also not pursue actions in the name of public health in fear of upsetting China.
- The question then comes up, why did Canada wait so long to curb the flow of international flights?
- The US blocked Chinese carriers from landing in late January. Canada still lets all international carriers in through 4 airports.
- Swedish MP Gunnar Hökmark wrote in an opinion piece that, “China’s leaders should apologize to the world for epidemics coming from China because of the dictatorship’s failure to address food safety, animal standards, and because its repression of truth and the freedom of its own citizens.”
- China’s ambassador (a part of the Chinese government of course) condemned the statement and accused the Swedish MP of stigmatizing China.
- And finally, US based Chinese human rights activist Jianli Yang said that he personally doesn’t like the term “Chinese virus” that US President Donald Trump was using to describe it but doesn’t believe there’s any racist sentiment.
- Yang believes that “there should be and must be a moment when all, victimized individuals and countries, come together to hold the CCP regime accountable.”
- Now how does this come back to Canada? Almost two months ago Canada’s chief public health officer Theresa Tam encouraged Canadians that Canada’s risk was much lower and it was “going to be rare” that there would be cases in Canada.
- Now with cases skyrocketing we have to ask, what happened?
- Canada didn’t act decisive enough.
- Taiwan, right next door to China has just 216 cases and 2 deaths with obviously a much closer connection to China than Canada.
- As early as December 31 Taiwanese officials boarded incoming planes checking passengers for the virus. In January Taiwan brought in strict travel bans and quarantines in regards to China.
- Canada instead followed orders from the World Health Organization and aimed to combat stigma and racism.
- It was January 24 when the WHO argued against travel bans. Theresa Tam also made it clear that it would be our hospitals, not our borders, that would slow the spread.
- The same behaviour continued for 6 weeks until the land border with the US was shut down.
- The lesson is clear, borders work and we need to be honest about where this virus came from. Canada could’ve been in a similar situation to Taiwan but for now our trajectory remains unclear.
- As public health officials and politicians alike try to find the best way to tackle the current health emergency crisis, many issues that wouldn't normally even exist have cropped up. Crime has increased, where businesses that would normally be happily open serving customers lay abandoned, ripe for criminals to desecrate. Global News likened Vancouver's once bustling downtown core as "a set of a zombie horror film", as businesses are boarded up with plywood to deter thieves. A ghostly atmosphere has settled over the province of BC, and as the not quite a lockdown continues, the deserted nature of our province's areas of commerce will continue as well.
- 2 weeks ago, there were multitudes of item resellers setting up shop in parking lots of major businesses like Costco, selling toilet paper, Lysol wipes, and other currently in demand goods.
- Around the same time, Amazon blocked the account of a Vancouver couple, Manny Ranga and Violeta Perez, who claimed to have made $100,000 in the past two weeks by mass-purchasing Lysol wipes at Lower Mainland Costco locations, and reselling them online at four times the cost.
- In response, Amazon released a statement saying “There is no place for price gouging on Amazon. We are disappointed that bad actors are attempting to artificially raise prices on basic need products during a global health crisis and, in line with our long-standing policy, have recently blocked or removed hundreds of thousands of offers. We continue to actively monitor our store and remove offers that violate our policies.”
- The City of Vancouver now has the power to issue fines to businesses and people who break rules meant to ensure social distancing. City councillors unanimously approved the move this week. Social, or physical, distancing is a provincial public health order, telling British Columbians to stay at least two metres away from others and avoid crowds of 50 people or more to slow the spread of the coronavirus. The approved fines for businesses in Vancouver can be as high as $50,000, while penalties for individuals can be up to $1,000. Other municipalities are considering following, but have not done so yet. It is unknown how many social distancing fines have been given out by Vancouver police.
- And now, the BC government has dramatically stepped up its use of emergency powers, giving itself the authority to take over supply chains for delivering essential goods and services throughout the province.
- The sweeping moves grant B.C. the ability to demand that retailers and suppliers report inventory of critical supplies, including protective health equipment for front-line workers.
- The latest measures aim to stem panic buying and hoarding that have emptied grocery shelves of staples. They also address the shortages of protective gear in hospitals that have prompted rationing of equipment for health-care workers as they brace for growing numbers of infected patients.
- Premier John Horgan, who clearly looked at last week's episode and saw our word of the week being 'unprecedented', told reporters during a news conference in Victoria that the measures taken were extraordinary for the circumstances: “The steps we’re taking today are unprecedented. But I find myself saying that almost every day.”
- In addition to the supply chain measures, B.C. has now joined Ontario and Quebec in defining essential services, which are being encouraged to remain open, with appropriate physical distancing measures.
- As well, the province has banned the secondary resale of food, medical supplies, personal protective equipment, cleaning and other essential supplies. The new powers also allow B.C. to restrict quantities of items purchased from retailers.
- Horgan says: “British Columbians are worried about our flow of essential goods, and our ability to ensure shelves are stocked. Emergency Management B.C. will take a more active role in coordinating essential goods and services movement by land, air, marine and rail."
- The province is now identifying warehouses and other facilities that it could take control of, for gathering supplies and resources if required. That includes community stadiums that could be turned into health facilities if hospitals are overwhelmed.
- Public Safety Minister Mike Farnworth said “Many airlines, large and small, now have spare capacity. We want to bring them in, so that they’re able to to assist us. So it’s very much a co-operative effort. It does give us some considerable power, but again it’s all about planning for the long term, as well as the immediate needs.”
- Samantha Kent, marketing manager for Harbour Air, which operates one of the largest all-seaplane airlines in the world, said her company is ready to help. “Harbour Air is a vital transportation link to coastal British Columbia for both essential travel and in assisting the supply chain process. Now more than ever, we are here and ready to help support our government, communities and local businesses.”
- The reaction from business to the news from government has been largely positive.
- Bridgitte Anderson, president and chief executive officer of the Greater Vancouver Board of Trade, welcomed the effort to strip away barriers to transport. “We support the increased flexibility for the timing of goods movement through to retailers and store owners. Ensuring an open port, trucks and trains moving freely and goods crossing the border, is critical,” she said in a statement. "We need our supply chains to continue to function – that will be of the utmost importance for society to manage its way through the crisis.”
- The chairman and CEO of The Jim Pattison Group, Canada’s second-largest private company, said in an interview that he is prepared to back the provincial government through the pandemic crisis: “We would absolutely co-operate with the authorities, whatever they ask from of us, on whatever is best for the people of the province of British Columbia,” Jim Pattison said.
- Clint Mahlman, the chief operating officer of Western retailer London Drugs, agreed that the measures will help. “We are extremely supportive of the government’s actions,” he said, noting that all goods for London Drugs stores in the four Western provinces come through its Richmond warehouses.
- Mr. Mahlman said the company had been offering Emergency Management BC insights on the supply chain, including their stock on hand and availability. Also, he said London Drugs buyers have been offering health officials advice on finding products required to deal with the pandemic, such as masks and surgical gloves.
- As the government works with business to keep supply lines of essential goods moving, there has not been much criticism in the media of the government's overarching measures. Time will tell if the approach we are taking is the correct one.
- With the economic downturn the question has been asked recently if Canada’s federal carbon tax will go up on April 1 as expected.
- Wheat farmers in particular have been calling for more economic aid as the federal government increased the lending capacity for Farm Credit Canada this week.
- The Western Canadian Wheat Growers association put out an urgent statement saying, “The Canadian economy is facing a serious challenge. Adding a 50 per cent increase in the carbon tax is a further hit to grain farmers’ bottom line and Canadian consumers’ food bills. Now is not the time to be adding to our household expenses.”
- The Conservatives have long been adamant that they want to see the carbon tax scrapped altogether and will do so should they form government.
- Alberta recently won at the Alberta Court of Appeals in a 4-1 decision saying that the carbon tax is unconstitutional and that fight will go to the Supreme Court.
- On Friday at his daily briefing Trudeau was asked by the media about the carbon tax.
- In response he said, “We know that it is important that we put more money in the pockets of Canadians at this point when they’re stressed. Our plan on pricing pollution puts more money upfront into people’s pockets than they would pay with the new price on pollution. We’re going to continue to focus on putting more money in people’s pockets to support them right across the country.”
- And when asked for clarification, the Prime Minister said: We continue to make sure that people have more money in their pockets because that is how we designed the price on pollution.
- Now what kind of increase are we looking at? A 50% increase for jurisdictions under the federal carbon tax.
- This means about an extra 2.5C/litre on gas and higher home heating prices.
- With moves from the federal government to subsidize up to 75% of wages for small and medium sized businesses it’s clear that this predicament for the economy doesn’t end anytime soon.
- Suspending the carbon tax would be one measure that would lighten the load on Canadians.
- Another as suggested by Conservative leadership candidate Peter MacKay is to raise the personal income tax exemption from about $15,000 to $30,000. Meaning those who earn under $30,000 would pay no income tax and everyone else would save on their taxes.
- While stimulus is important, the tax side of the equation should be looked at very seriously by all levels of government.
- As the international media concerns itself with pandemic news from their own local countries, it takes a lot to do something so dumb to be noticed by foreign outlets. Certainly the toilet paper and lysol resellers I mentioned earlier made the news internationally, which were not good looks for the city of Vancouver, but now notice has been made of what our federal government has been doing.
- It was a move that the Wall Street Journal referred to as "Trudeau’s Coronavirus Power Grab". The left leaning Washington Post, which is usually kind to Trudeau, had a damning headline this morning: "Trudeau learns a lesson on grabbing power during a pandemic". In it, JJ McCullough describes how countries usually rally behind their leaders, but sometimes those leaders go too far and get slapped down.
- "The coronavirus crisis has presented a unique dilemma for Canada’s opposition parties — as it has for opposition parties in democracies around the world.
- On the one hand, in moments of national emergency there’s a traditional pretense of putting partisanship aside and rallying behind the leader. In this sense, politicians follow the public: Prime Minister Justin Trudeau’s Liberal Party is enjoying a relative boost in the polls at the moment, as are President Trump, French President Emmanuel Macron and British Prime Minister Boris Johnson. All of these deeply theatrical men have proved adept at what could be called the “pomp and ceremony” aspect of crisis management, with daily briefings and national addresses skillfully designed to evoke goodwill."
- In a response to the pandemic that has spread across Canada, the House of Commons opened last Tuesday for an emergency session meant to pass a spending bill that would get help to Canadians who are out of a job, businesses threatened with bankruptcy, and other issues that needed to be addressed sooner rather than later. However, the government knew that it would not pass. Why would they know that ahead of time? A draft copy was leaked, and all opposition parties were concerned with what the Liberals were trying to push through Parliament in the stimulus bill under the guise of helping Canadians.
- According to reporting on the draft legislation, buried among many other things, Trudeau’s coronavirus bill proposed giving Minister of Finance Bill Morneau new powers of the sort that have become common in Canada’s top-heavy system: the power to decree statute-like “regulations” without legislative oversight. In this case, the legislation said, the regulatory powers of the Finance Department should be expanded to include “the effect of repealing or imposing a tax, decreasing or increasing a rate or an amount of tax or otherwise changing the incidence of tax.” The executive’s power to unilaterally adjust the tax rate would be supplemented by fresh power to borrow and spend “all money required to do anything” (as the text bluntly put it) relating to the coronavirus crisis.
- This means that the legislation would give the Liberals free reign over all spending measures for the next two years, much longer than the current health emergency is likely to last.
- In a statement on Monday, Conservative leader Andrew Scheer said the party “will not give the government unlimited power to raise taxes without a parliamentary vote. We will authorize whatever spending measures are justified to respond to the situation, but we will not sign a blank cheque.”
- That caught the Liberals off-guard. In an 11 p.m. tweet the night before the big day, Government House Leader Pablo Rodriguez had to break the news: “We consulted with the opposition and will bring changes to the draft legislation. We will always work collaboratively and respect the fundamental role of Parliament.” Never has an 11th-hour retreat sounded so considered and mature.
- Later on Tuesday, The Liberals returned to Parliament having given up on the tax authority but still seeking unchecked power to extend loans and guarantees and to “make payments to an entity for the purposes of stimulating economic activity or employment in situations of significant and systemic economic and financial distress.” Another surviving provision would empower cabinet ministers to requisition from the Treasury “all money required to do anything, including making payments to provinces and territories, in relation to that public health event,” namely the pandemic. Negotiations continued all day and past midnight. Finally, at 5:51 a.m. Wednesday, the parties approved an aid package of 52B, in which the government gets a six-month emergency spending power that will be scrutinized and can be taken away if abused.
- This is a decent result, born of compromise. But the irony of the Liberal Party proposing to abrogate the signal achievement of constitutional liberalism, the freedom from arbitrary political power, is enough to make John Locke turn in his grave. Trudeau’s initial plan to combine in the executive the power to create the law, finance it and enforce it—powers of the pen, purse and sword—was a recipe for abuse. It also threw out hundreds of years of English-speaking peoples’ political theory and practice. Conservative finance critic Pierre Poilievre rightly mentioned the Magna Carta and “no taxation without representation.”
- There was no need even to start down that road. Trudeau is dealing with a cooperative opposition party that had pledged to support his economic relief measures. The Conservatives had even agreed to vote on short notice in a shrunken Parliament, with 32 members divided proportionally among the parties, the better to practice social distancing. Trudeau’s rash request, made in the heat of a crisis, underscores the continuing need for a loyal opposition, the separation of powers and the liberal tradition that Liberals once claimed as their own.
- As for the aid bill itself, what will it look like heading into next year? According to the Parliamentary Budget Officer, the Liberals are looking to run $113B deficit in 2021, as the Canadian economy falls off a cliff.
- The PBO expects the Canadian economy to contract by 25 per cent in the second quarter of 2020. Annual economic growth in 2020 is expected to slide to negative 5.1 per cent — a bigger yearly contraction than the 2008 financial crisis, and the sharpest plunge since the early 1960s. The $112.7-billion deficit is nearly $90 billion higher than earlier estimates. Unemployment is expected to rise to 15 per cent.
- The PBO also says that extra stimulus measures may be required to ensure the economy hits “lift-off speed,” especially if consumer and business behaviour does not quickly revert back to “normal” fast enough.
- Also on Friday, the Bank of Canada announced another cut to its overnight interest rate, which analysts had been expecting as the bank readies further options including potential quantitative easing measures.
- If our current path holds, then the Canadian economy is headed for dark times.
Word of the Week
Power Grab - the attempt or action of acquiring or accomplishing something that was previously unattainable-but is now possible through newly acquired power, typically underhanded.
How to Find Us
Episode Title: Taxing the Essentials
Teaser: China receives a pass from the Canadian media, the BC government takes over the supply chain, and the federal carbon tax will still go up on April 1st, which is no joke. Also, Trudeau’s power grab to spend whatever he wants is thwarted by the opposition.
Recorded Date: March 27, 2020
Release Date: March 29, 2020
Edit Notes: Internet pause
Podcast Summary Notes