The Liberals face a summer of discontent

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Two summers ago, Prime Minister Justin Trudeau's Liberals started allowing themselves to talk ambitiously about a post-pandemic future about learning the lessons of COVID-19 and seizing the momentto push the country forward.

Two years later, nearly all pandemic-era precautions have been set aside and most Canadians seem ready to stop worrying about the virus. But as the summer of 2022 beckons, the political mood is more anxious than excited.

"I am confident that our plan is the right one," Finance Minister Chrystia Freeland said in a speech on economic policy and inflation she delivered on Thursday. "But I do not underestimate the economic difficulties and uncertainty of the months to come. We have been through two years of remarkable turbulence. Our challenge now is to land the plane."

A safe landing is not the most ambitious goal, obviously. But it is necessary. And even if this post-pandemic moment is less optimistic than many once hoped, it might be more consequential than expected for reasons the Liberals might not have anticipatedin the summer of 2020.

A reasonably productive spring

Viewed from certain angles, this was a fruitful spring for the government.

In the space of nine days in late March, the Liberals signed a confidence-and-supply agreement with the NDP, finalized a deal with Ontario to complete plans for a national child care systemand released a new plan for hitting Canada's greenhouse gas emissions target for 2030.

A few weeks later, the Liberals tabled a new budgetwith an emphasis on government support for innovation and the promise of a new dental care program (the latter at the NDP's request).

WATCH: Finance Minister Chrystia Freeland rejects further anti-inflation measures

Freeland rejects calls for more action on inflation

2 years ago

Duration 2:09

Finance Minister Chrystia Freeland rejected calls for new measures to fight inflation, instead highlighting $8.9 billion in existing funding to help Canadians.

The government tabled legislation on gun control, Internet regulation anda new disability benefit and introduced amendments to the Official Languages Act. In April, the cabinet approved the Bay du Nord project in Newfoundland. In June, it granted British Columbia an exemption to decriminalizepossession of small amounts of certain narcotics a move meant to combat the opioid epidemic.

Not everyone will agree with all of those things. Somemight disagree quite strongly with some of them. But these are the things the Liberals were elected to doand some of them could be described as big things.

But while the Liberals have been cruising along, the warning bells have been ringing loudly and the crosswinds have beenpicking up speed.

The convoy still casts a shadow

Indeed, the first six months of 2022 are unlikely tobe remembered for any of the things mentioned above because in late January, a bunch of people with trucks drove into downtown Ottawa. And then they didn't leave.

The self-styled "freedom convoy" eventually triggered the first use of the Emergencies Act since those extraordinary powers were passed into law in 1988. Two separate inquiries are, as required, now studying the Trudeau government's decision to declare an emergency. The Conservatives are eager to make the case that the declaration was unjustified.

But beyond the practical and legal questions raised by the convoy protest and its blockades, itcreated a noise that is still reverberating through Canadian politics. In short order, it hastened the end of Erin O'Toole's awkward leadership of the Conservative Party. It also set the stage for the strident, tear-it-all-down populism of Pierre Poilievre.

If the spring of 2022 is remembered for anything else, it might be for other sources of angst. The average house price hit a record high in February. Inflation reached its highest point in 31 years in April.

Like a campfire, populism needs kindling and there's a potential abundance of it right now. Poilievre's campaign may have been ignited by frustrations about the pandemic, but if it's to be sustained the fuel will be things like inflation, interest rates and the price of buying a home. It could thrive on a new recession orfinancial crisis.

Can the Liberals land this plane?

Freeland's speech on Thursday marked the Liberal government's belated entry into the political fight over inflation.It's a problem beingdrivenlargely by events beyond the government's control a pandemic, a new war in Europe. But the Liberals have struggled to find something to say about the situation.

Freeland's3,300-word speech at least acknowledgedthe problem andlaid out an argumentthatthe government's existing policiesmight address it while holding out the possibility of more action, if necessary.

It's not that the Liberals have entirely renounced the ambitions they claimed in August 2020. Provincial governments are still waiting to see what the federal government has to offer on health care and the future of employment insurance reform remains a mystery. But the child care deals got done and innovation and a clean economy seem to be at or near the top of the agenda.

It's just that implementing and justifying a progressive agenda is now much harderthan it used to be.Every dollar of new federal spending is much easier to criticize as long as inflation is running hot.

And when the House of Commons reconvenes in September, there's a decent chance that the seat reserved for the leader of Her Majesty's Loyal Opposition will be occupied byPoilievre an ideologue who would love nothing more than to turn the ship of state around and head in the opposite direction.

The most important thing Trudeau did for himself this spring may havebeen signing that confidence-and-supply agreement with the NDP. It means (at least in theory)that the threat of an election is no longerconstant. And it offers his government(again, in theory)some time to ride out the current turbulence, put an agenda in place and make the case that it's the right agenda for the moment.

When you're trying to land a plane in high winds, a longer runway probably helps. But it'sno excuse for complacency.