The News Rundown

Trudeau overhauls his cabinet, drops 7 ministers and shuffles most portfolios

This Wednesday, Trudeau surprised us all by doing a cabinet shuffle, dropping some familiar faces from cabinet completely, while others just recently announced this past week that they would not be running in the next election at all.
Trudeau dropped seven ministers and changed nearly three-quarters of his cabinet, overhauling his team at a time of heightened tensions overseas and scandals at home. The shuffle promotes seven new faces and tasks more than a dozen ministers with new roles, including a new minister of defence and public safety.
Trudeau's new cabinet team meant to have a renewed focus on economic priorities, such as housing, inflation and healthcare. Reporters asked the prime minister repeatedly whether the shakeup amounts to an admission that his nearly eight-year-old government is slumping. Trudeau doesn't think so, but recent polling indicates the Liberals are trailing the Conservatives. Opposition parties have criticized how the government has addressed the cost of living crisis.
We're not going to go through all of the changes here, but there is a very handy list on our linked CBC story on the matter in the supplementals in case you want to see all the changes.
However, we will go over the important ones: Marco Mendicino, who was most recently public safety minister, was dropped from cabinet completely. His demotion ends a tenure at the cabinet table plagued by multiple controversies, including the government's poorly received gun control legislation, lingering questions on the foreign interference file, and controversies including the RCMP's role in policing. More recently, Mendicino was under intense pressure due to the controversy over the transfer of serial killer Paul Bernardo to a medium-security prison. Mendicino, who might have seemed to some like he was one of the few competent Liberal cabinet ministers, clearly was not, as all the scandals mounted and pressure to get him to resign continued.
One notable failure of the shuffle is that Sean Fraser, formerly the immigration minister, is now in charge of housing. Yes, the same minister that spearheaded an enormous influx of immigrants into the country is now in charge of the portfolio that is suffering from the policy that his former portfolio came up with.
Now former Justice Minister David Lametti was also dropped from cabinet, and both he and the media were a bit surprised by that.
But for all that changed, much stayed the same. Environment Minister Steven Guilbeault keeps his role, and Jonathan Wilkinson, the yin to Guilbeault's yang, is still the minister of natural resources (though he now also has "energy" in his official title). Francois-Philippe Champagne, remains minister of innovation. Deputy Minister and Minister of Finance Chrystia Freeland also continues as Trudeau's 2nd in command.
Keeping those four ministers in place suggests a government that doesn't think it needs to change a whole lot about itself or its basic agenda. The relative wisdom of that judgment might not be clear until the ballots from the next election are counted.
The cabinet reset did little to impress Conservative Leader Pierre Poilievre. He said: "After eight years of Trudeau, everything costs more. His government is a failure. It's funny, though — the one minister responsible for those failures didn't get moved. And that minister is Justin Trudeau."
Which leads us to the futility of this cabinet shuffle to begin with — it doesn’t matter who’s in what role if no power actually changes hands. And, in this government, power has always remained steadfastly in the clutches of Trudeau and the Prime Minister’s Office. There’s no reason to believe that will change after nearly eight years.
Bloc Quebecois leader Yves-Francois Blanchet was unimpressed with the changes as well, with a main focus on the size of the cabinet: "A cabinet of 39 is not a serious decision-making body. As cabinet gets larger, moreover, the ministers get smaller. In a cabinet of 12, every minister is a player. As you pass 20, they start to blur together. By the time you near 40, they look like ants."
Trudeau fundamentally doesn’t get affordability issues and can barely muster the will to even talk about them. This might be passable if his finance minister could pick up the slack, but Chrystia Freeland has shown herself equally incapable of understanding, let alone legislating for, today’s economic reality.
This cabinet shuffle does little to change the reality that most Canadians face. At the end of the day, it's still the Trudeau Liberals. Whether or not that's good or not is up to you to decide.
Supplementals:

NDP calls for probe into how many medical clinics are charging 'member' fees in Alberta

Last week on our Alberta segment we talked about the need to reform healthcare in the province. This week we’re covering a story of private delivery of services funded under the Canada Health Act.
This week it was revealed that a set of clinics operating in Calgary were charging membership fees for preferential access.
First was the Marda Loop Medical Clinic and second was Harrison Healthcare.
The clinics offer priority service to those who pay and in the case of Marda Loop operate one day a week for those who don’t.
Danielle Smith was clear that the government will uphold the public healthcare guarantee and the principles of the Canada Health Act saying that the UCP would not let health care membership happen.
The end.
These stories have spurred the NDP to ask how many medical clinics could be charging membership fees and for an investigation to begin.
The UCP will order an investigation into Marda Loop and if they are indeed breaking protocol, they will be shut down or have their funding curtailed.
We’ve covered Health Canada deductions before but the trend continues. Alberta was subject to a $13,781,152 deduction to its Canada Health Transfer payment in March 2023 under the Diagnostic Services Policy in relation to patient charges to access diagnostic services such as MRIs and CTs. Two other provinces saw higher deductions under the policy in March. Quebec saw $41,867,224 deducted, while British Columbia saw $17,165,309 deducted.
The idea of these health clinics is an outrage to many but the reality is, these sorts of businesses have been operating under the table for a long long time.
Researchers from Dalhousie University and Simon Fraser University released a paper in 2022 that suggested that there were 14 private clinics offering a range of membership fees and private payment between November 2019 and June 2020. Such clinics are also found across the country, including in Ontario, British Columbia and Quebec.
And the second clinic, Harrison Healthcare, has a Vancouver office. That raises the question, if they’re operating in Alberta, are they also operating in BC?
That’s the surface level analysis of this story complete but it raises a number of questions.
First, if this is happening across the country in BC, Ontario, and Quebec amongst others, why do people feel the need to offer services in this manner?
Second, why does the discovery of these clinics in Alberta warrant a big red stop light and an investigation now?
And finally, what is the demand for a service agreement like these clinics offer.
The first can only be answered by a comprehensive review of the supply-side of health care in our country. As in, do we have enough doctors? Is it easy enough to start a practice? What are the barriers to creating more doctors?
On the second, private healthcare and transgressions against the Canada Health Act are not new. We need to know if there was something specific about the Alberta case that brought these clinics to the forefront.
And last, what do patients think? TV reporting from Global News and CBC in particular did not seek out potential patients or clients who would be in favour of such and agreement.
And that, right there, suggests all we need to know.
Given the coverage these clinics are now getting, is our country grown-up enough to have the conversation about private delivery of healthcare with an out-of-pocket payment option?
Last week we assumed that the mandate letter to Health Minister Adriana LaGrange was setting in place an administration to work around the edges and not offer wholesale reform.
To recap, this story is an issue under the present implementation of the Canada Health Act. But the question has not been asked are these private clinics a viable solution and is there actually a demand for them amongst the public?
The media needs to facilitate a discussion on these questions and highlight that it’s not just an Alberta thing before we can begin having meaningful conversations about healthcare in this country.
Supplementals:

It's summertime, which means a lot of people are going on road trips to see family, as well as the sights and sounds of our wonderful country. For many British Columbians, especially Vancouver Islanders, and those on the Sunshine Coast and Gulf Islands, this means partaking in the ritual of using BC Ferries, and sadly this generally means a long wait.
Independently managed but provincially owned, the ferries are a crucial part of the province's infrastructure that transport tourists to popular vacation destinations and provide essential services to people who live and work on the islands that dot B.C.'s coast and in communities on the central and north coasts.
But this summer, getting on a ferry has felt like winning the lottery, as B.C. Ferries has been plagued by technical difficulties with its vessels, last-minute cancellations, staffing shortages and confusion about the availability of reservations online.
Even B.C. Premier David Eby has weighed in, saying the repeat cancellations are unacceptable: "Every Islander knows that the ferries are part of our highway system. It's not just, as it is for our family, a good way to visit grandma and to come over to the island for a visit. It's an essential part of the island economy. It's how people get goods. It's how people get around. And we know the urgency of ensuring that B.C. Ferries delivers for British Columbians."
Cancellations throughout the summer of 2023 have been frequent, but the biggest impact came when, just hours before one of the busiest long weekends, B.C. Ferries pulled one of its largest vessels from service, leading to eight daily sailing cancellations on the Tsawwassen-Swartz Bay route.
The Coastal Celebration, which carries up to 310 cars and 1,604 passengers and crew between Metro Vancouver and Greater Victoria, was scheduled for refits in mid-May in Victoria. But after just one company bid on the contract, the refit was moved to Vancouver and delayed to mid-June.
Spokesperson Karen Johnston said at the time that B.C. Ferries schedules most of its refits between September and May, before the busy summer travel months. Johnston said: "We do our best to control and plan ahead for our refit schedule. This was a situation where there were circumstances beyond our control."
The problems with the Coastal Celebration didn't end there. The vessel saw several cancelled sailings in the past weeks due to a mechanical issue with its propulsion system, and on July 24, the vessel was taken in for repairs after it developed a hydraulic oil leak because of a broken or otherwise ineffective seal.
This meant that during the past couple of weeks, there have been 4 less round trips to and from the island per day, leading to huge backlogs that BC Ferries' own website incorrectly estimates. On Tuesday this past week, a website post claimed “a nine-sailing wait” for service to Vancouver Island out of Tsawwassen terminal. The posting dominated the morning news on Tuesday until someone at the ferry service noticed and called to say it wasn’t true, and that the wait was only a one sailing wait.
Johnston explained that the booking system “assumes that all customers are going to show up for their reservations.” It went into overload at Tsawwassen “when about 10 to 20% of customers didn’t show.” In short, it was the fault of the customers. With ferry staffers scrambling to update the antiquated booking system by hand, Johnston had some advice for would-be travellers in the interim: “Twitter is the way to go.”
Another notice posted on BC Ferries’ website is warning travellers of a possible delay in processing compensation and refund requests, noting that a high volume of applications has been received: “Our normal response time is between seven and 14 days, but currently it may take four to six weeks. To improve our response time, we are hiring additional staff and working on process improvements.”
While Johnston's job is certainly not enviable, fielding tough questions on behalf of an angry public fed up with the long waits, absent are the higher ups, nowhere to be seen, heard or found.
For starters, where is Joy MacPhail, the former NDP cabinet minister the New Democrats appointed to the ferry board more than a year ago? On being selected chair of the board in late June 2022, MacPhail’s first act was to fire CEO Mark Collins at a cost of over $1 million in severance. Then-Premier John Horgan linked the firing to service disruptions and waiting times: “People waiting in line would probably say, ‘What took you so long?’”
At the start of this year, MacPhail announced the selection of Nicolas Jimenez as the new CEO, having formerly worked with him at ICBC. Jimenez started in March. In May, he emerged to announce some minor reforms: an attempted crackdown on car alarms, access to the upper decks for pets, and cancellation of the money-losing, but super popular buffet (clearly a victim of inflation, as are we all). The CEO’s attempt to portray himself as “hitting the ground running,” was spoiled by major service disruptions during the May long weekend and an even worse showing over the Canada Day holiday.
This month, Jimenez offered a more realistic take on the future of the ferry service. “There’s no short-term fix. To bring this ferry system to where it needs to be, this is an exercise that will take years to unfold.”
Then there is provincial transportation minister Rob Fleming, a longtime MLA for Victoria and the member of cabinet in charge of B.C. Ferries. Fleming did take some media questions about the ferry service when he turned out for an announcement at the legislature on Wednesday.
He began by admitting that the misinformation on the website meant that the ferry service “potentially turned away loads of customers.” A fix to the antiquated technology “can’t come fast enough,” according to Fleming.
Hard to fathom why he would have any patience for B.C. Ferries on that issue. The New Democrats gifted the ferry service a half a billion dollars from the budget surplus earlier this year, with precious few strings attached, according to Fleming’s briefing to the legislature in March.
Beyond that, Fleming repeated his now-familiar mantra that the service troubles are “unacceptable” and steps are being taken to “ensure it doesn’t happen again,” which is hardly reassuring. He said much the same thing following the disruptions over the May and Canada Day long weekends. Fleming said: “I know the CEO and the team there are working on ensuring that it doesn’t happen again for the remainder of the summer. This is a difficult period.”
When asked what exactly the government is doing to ensure things will be different on the coming B.C. Day long weekend, Fleming retreated to another familiar line of defence — the one where the New Democrats are obliged to “respect the independence of B.C. Ferries.” The relationship is “arm’s length on the operating side,” he told reporters. “We don’t direct them to make operational decisions.”
Which is a hilarious abdication of blame and responsibility. The notion of an independent ferry service evaporated a year ago when the New Democrats dispatched a longtime NDP cabinet minister to run the BC Ferries board in MacPhail and to handpick their own chosen CEO. With that, Fleming and his NDP colleagues took political ownership of the corporation and became fully accountable for its troubles.
To quote Horgan when his handpicked board chair did the deed: “The public wants service. They expect it. They’re paying for it. And when it is not there, we have a responsibility.”
Still, when the sailing gets rough, the New Democrats and their appointees continue to hide below decks, leaving crew members to deliver the increasingly dubious explanations for the failings of the ferry service. When Horgan appointed an NDP partisan and then gifted half a billion dollars to fix the issues, and the issues still occur, that's on the BC government. It's often said that BC Ferries is an extension of the highways system - it's high time that it started acting like it.
Supplementals:

Firing Line

Canada's Immigration Policy Driving Housing Unaffordability, Higher Rates - TD

This year on Western Context we’ve covered Canada’s drastic increase in immigration which is now approaching 500,000 newcomers per year.
Factoring this in, our population has grown by 1.2 million people over the last year.
A recent analysis by TD Economics shows that this "textbook demand shock" is having far more negative consequences than positive on the Canadian economy and social system.
A demand shock is an unexpected event that increases or decreases demand for a product or service. In this case, housing.
TD asked whether “the sudden swing in population has gone too far, too fast.”
The report points out that high levels of immigration support the labour market and economy in the long term, this surge of population is coming at a cost of worsening dislocations and other segments of the economy.
"While the right hand has been solving for labour market shortfalls, the left hand has not put in place the appropriate infrastructure to absorb this large influx of people".
The reports note that continuing with a high immigration strategy could widen the housing shortfall to 500,000 units within two years.
The report continues by saying that government policies are unlikely to offer a stop gap due to the short time period in question.
After tying all these together the report concludes that any meaningful improvement in affordability won’t happen.
The report also moves beyond housing saying that social systems, health care, and physical infrastructure will also feel the pain.
Before the pandemic, Canada ranked 31 of 34 OECD countries when it came to number of acute care hospital beds per capita.
For those seeing where this is going, it is almost certainly painting immigration as one of the key factors driving the affordability crisis.
Of course there are others as well such as the increased costs following the increased demand of everything post-pandemic but immigration is something that the government controls.
The report also highlights that increased immigration is tempering our GDP per capita growth and also making the economy less sensitive to the increases in interest rates that the Bank of Canada has been executing.
What this means is that interest rates have had to go higher than they would if population levels remained stable.
The conclusion of the TD report says that the interest rate probably needs one more bump by 0.5% and that immigration is still a good thing.
It said, "While population growth is a good thing and a necessary remedy to aging domestic demographics... the benefits erode if it occurs too fast relative to a country’s ability to plan and absorb new entrants within the economic and social infrastructure."
Immigration by economic policy is not something that people think of at first but this TD report shows it is definitely something that should be considered and needs to be remedied.
One of the knee jerk reactions is that any opposition to immigration is racist. And there are those who feel that the spike in housing prices should not be tied to our immigration numbers since that would be racist.
It also raises the question of what the media narrative will be and what the governing Liberals will say if the Conservatives decide to tap the brakes on immigration.
Economic policies at times are obtuse and abstract and difficult to explain which leaves the ground ripe for someone to capitalize on the fear of an anti-immigrant sentiment.
And we say this because in each of Justin Trudeau’s elections he has found some issue at which to divide Canadians on which has allowed his party to capture voters.
An anti-immigrant policy would entail stopping all immigration or denying immigrants from certain countries.
What is likely needed is a sane middle option of a temporary pause on new immigration applicants of 3-6 months, not new people coming in, to allow a new government to figure out what immigration levels are needed.
Then those levels could be tuned based on what the economy needs and what type of immigrants are needed.
Of course this will be painted as a xenophobic policy when in reality it’s not extreme compared to other policies we’ve seen out of Europe or the United States.
And as with most things our media and narratives put forward by the current government prevent this conversation from happening which means that things will continue to become less and less affordable.

Quote of the Week

"A cabinet of 39 is not a serious decision-making body. As cabinet gets larger, moreover, the ministers get smaller. In a cabinet of 12, every minister is a player. As you pass 20, they start to blur together. By the time you near 40, they look like ants." - Bloc Quebecois leader Yves-Francois Blanchet on the size of Trudeau’s new cabinet

Word of the Week

Shuffle - move people or things around so as to occupy different positions or to be in a different order.

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Show Data

Episode Title: The More Things Change…

Teaser: Trudeau performs a cabinet shuffle, the media highlights private Alberta medical clinics charging member fees, and problems at BC Ferries continue. Also, a TD report shows how immigration is fuelling unaffordability.

Recorded Date: July 29, 2023

Release Date: July 30, 2023

Duration: 53:45

Edit Notes: None

Podcast Summary Notes

Duration: XX:XX