Mark Carney’s Liberals won the election promising to stand up to Trump and his tariffs and threats to make Canada the 51st state. In office, Carney dropped the “elbows up” approach; instead, he is appeasing Trump. The Liberals have scrapped almost all tariffs on US imports. They agreed to join the “Golden Dome,” a space-based system of satellites and weapons with a cost estimated between $1 and $4 trillion.
Carney’s policies are similar to the Conservatives. Jobs are being slashed – steel plants, car factories and sawmills all closing. The recent budget includes cuts to some departments (including Environment and Climate Change, Innovation and Science, Indigenous Services, Veteran’s Affairs and Transport) of $60 billion in five years that will weaken many public services and slash 40,000 jobs. It is claimed that many of the jobs cut, such as in Canada Revenue Agency or Employment and Social Development, will be replaced with AI. However, technology often wastes money. The Phoenix computer payroll system still does not work after 15 years and $5 billion of extra spending. Canada Post, as part of its self-destruction plans, intends to cut 30,000 jobs in the next 10 years.
The budget is business-friendly and in spite of deep cuts, the deficit will grow to $78.3 billion for 2025-26. This is because military spending will explode — up by $84 billion over the next five years and Carney has promised to reach 5 percent of GDP by 2035. This is higher than what the Conservatives’ election platform called for.
As well as the military, the RCMP and border police are also getting more money. Carney’s government is spending $1.8 billion over four years to increase federal policing and to hire 1,000 RCMP personnel.
Housing, Infrastructure and Communities funding is cut, reducing money for new public transit. The Liberals cancelled the consumer carbon tax before the election and this budget has nothing to replace their previous headline climate policy. Trudeau’s plan to plant 2 billion trees has been halved. The government plans to increase public-private partnerships for infrastructure, even though they cost more overall. As a sop to the ultra rich the super tax on private jets and luxury yachts is scrapped.
Carney calls opposition’s bluff
Although there was speculation that the budget might not pass, thus triggering an election, it was narrowly approved (170-168). The Green’s one MP, Elizabeth May, voted for it based on Carney’s vague promise. Two NDPers abstained showing the party’s lack of determination to stand firm on their principles — they are neutral on cutting 40,000 jobs and a huge increase in military spending! As two Conservative MPs also abstained, the Speaker’s casting vote would have carried it even if every NDP member had voted no.
Carney has moved the Liberals in the direction of Harper’s Conservatives. Some Conservatives are happy with Carney’s conservative Liberals as shown by the recent defection of Chris d’Entremont to the Liberals. There are ongoing rumblings against Poilievre. Much of big business is happy with Carney’s government.
Carney imitates Trump on the border
Bill C-2, the Stronger Borders Act, claims to reduce both the flow of people and drugs across the border, a further effort to appease Trump. The Liberals had already announced reductions in the number of temporary foreign workers it would permit, and this bill explicitly targets refugees. No one who has been in Canada for more than one year, including people who arrived before the bill was tabled, would be able to claim asylum, regardless of conditions in their home country and what they might face if they were sent back.
While the bill included several privacy-violating measures, including provisions for the spy agency CSIS to access users’ online data without a warrant, overwhelming opposition forced the Liberals to repackage C-2 into a new bill, C-12 that maintains the restrictions on migrant and refugee rights, but removed some of the most egregious attacks on privacy. This new bill still faces fierce opposition.
Carney’s “nation building” = corporate gifts
Of the 12 Major Projects announced, nine increase dependence on resource extraction, will damage the environment (several will directly increase climate change) and do little to meet Canadians’ needs. Five are new or expanded mines (Sisson, NB, Nouveau Monde, QC, Crawford, ON, McIlvenna Bay, SK and Red Chris, BC); two are expansions of fossil fuel exports from BC (Ksi Lisims and Kitimat); two are measures to support mines and fossil fuels in BC (North Coast Transmission Line and Northwest Critical Conservation Corridor, which despite its name is more about mines and LNG then conservation) and one is an expansion of a highly polluting nuclear power plant in Ontario. The Red Chris mine in northern BC is already polluting the Stikine River, a major salmon river.
Only two: the Iqaluit hydro project and the highspeed rail link between Québec City and Toronto, have wider benefits to society.
Carney has cut a deal with Alberta’s Danielle Smith to build a second bitumen pipeline to the Pacific coast. The deal would drive up climate change. It includes a commitment to carbon capture, an unproven and expensive technology. Both carbon capture and a bitumen pipeline would require enormous government subsidies if they are ever to see the light of day. This a project that has no business backer, will face huge obstacles — economic, geographic and political — and could endanger BC’s Pacific coast as it would end the moratorium on tanker traffic on BC’s north coast. It is a vanity project by Smith, aimed at appeasing her friends in the oil lobby and her “Alberta first” base. She wants to be seen as standing up against BC. Even by the misguided logic of fossil fuel production, it makes no sense. Major pipeline companies (Enbridge and Trans Mountain) are instead focussed on expanding existing pipelines.
The major projects’ designation is a gift to corporations as it helps fast-track approval, possibly bypassing environmental and other regulations, and may lead to government funding.
A Socialist Alternative program
The conservative Liberals boosted spending on weapons by billions and recently cut taxes that mainly benefited the well-to-do but cut government money for services by at least $27 billion over five years.
Socialist Alternative has very different priorities. Investment should concentrate on three priorities: providing good union jobs, meeting society’s needs and protecting nature.
Canadians urgently need a massive house-building program, but all the bribes and handouts to the private sector do not work — that policy has been tried for decades and has produced the current housing disaster. Instead, Canadians need a publicly owned housing agency to build homes, with unionized workers, and rent homes. Build homes with the Canadian lumber and steel that Trump has tariffed that is ecologically sound — homes that stay warm in the winter and cool in the summer, without using large amounts of energy.
Another priority would be to seriously shift the energy system to renewables. Canada has plenty of wind, sun, tides and geothermal sources for energy. This would provide far more jobs than the fossil fuel industry does.
Instead of destroying Canada Post — a universal nationwide service, with the country’s largest network of branches and vehicles — it should be expanded. It could provide postal banking, a check-in service for seniors and home deliveries in remote areas.
A true nation-building project would be to rebuild the rail network. The first step is to take the two major companies, Canadian Pacific and Canadian National, into public ownership. This would open the door to major investments in upgrading the track and bed, dual tracking most routes and electrifying some. This would allow much faster train speeds (average freight train speed in Canada is 33 kilometres an hour, while the average speed in mountainous Switzerland is 120 k/h) and sharply reduce the time it takes to ship goods across the country. With good lines and dual tracking, passenger rail could be reintroduced and widely used in much of Canada. Shifting freight onto rail from roads and passengers from planes to trains would have significant environmental benefits. Calgary, Canada’s fourth largest city, has no passenger rail connections. Imagine high-speed trains, like Japan’s “bullet train” (Shinkansen) that travel up to 320 kilometres an hour, would get people from Calgary to Winnipeg in 4.5 hours!
Other actions could include providing good urban public transit and clean water on all reserves, and upgrading all public buildings (schools, hospitals community centres, etc.) so they are energy efficient.
These proposals will provide more jobs, more community benefits and more protection of the environment than Carney’s plans. However, they all challenge capitalism.
Working class needs to resist Carney
The Liberals have shifted decisively to the right. Increasing militarism, tightening border security, and accelerating the climate crisis will not raise the living standards of Canadian workers, nor will they revive Canada’s stagnant economy.
The working class needs to strengthen unions and build its own independent political organizations to resist the attacks of government and bosses. A strong workers’ movement can do more than resist attacks; it can campaign and win positive reforms that pave the way towards a socialist transformation of society.
