Is it time for Bill Morneau to go?


With the summer now here and the pace of news slowing, both as a function of how Ottawa operates and how the course of the COVID-19 pandemic has moved into a more stable phase, I thought I might engage in a little bit of idle speculation.  I’ve been talking to a number of people lately about how the government has handled the pandemic, and while everyone is looking at how their poll numbers have skyrocketed, fuelling the narrative of a possible snap election among certain corners of the pundit class for whom this remains on obsession, I wondered instead about some of the players involved over the past few months.  It occurred to me that if there was a bit of dead weight in the government’s response to the pandemic, it’s the one person who shouldn’t be – finance minister Bill Morneau.

The world is in the midst of an economic crisis the likes of which we have never seen before – it’s not a traditional recession, but rather an unprecedented demand-side shock brought on by the pandemic, and this has meant the need for billions of dollars in spending just to stabilize people’s incomes (which is falsely being labelled “stimulus,” even though it’s most certainly not).  It has meant tens of billions of dollars in additional spending, and it happened as the anticipated federal budget was scrapped as everything went sideways.  You would think that at a time like this, you would have a finance minister who could stand up and offer some reassurances to the Canadian public – and the global business community – about what is happening, and what the next steps will be.

But this is Bill Morneau, so what do we get instead?  A mouthful of pabulum about how the government’s fiscal balance sheet was strong before the crisis, and some bland assurances that they were going to be there for Canadians.  For a government that can’t communicate its way out of a wet paper bag, no one is more emblematic of its failure to do so than Morneau.  We got far more clarity and candour from the previous Governor of the Bank of Canada, Stephen Poloz, when the crisis was unfolding, even though Poloz is very constrained in what he is able to say because he only controls the very limited levers of monetary policy and not fiscal policy, and needs to operate at arm’s length from the government.  But Morneau seems to very much have been playing second fiddle to Poloz throughout the early days of the crisis, which is a problem.

We are expecting Morneau to unveil the government’s fiscal “snapshot” in lieu of a budget or update this week, and something that has been missing are any kinds of projections.  They keep saying that it’s impossible to project into next week let alone a year from now, but the telling mistake there is that the government hasn’t been doing its own projections – they’ve been aggregating the projections from the top 15 private sector banks and firms and using that figure, and those firms have made those projections known.  For Morneau not to use them is suspect to say the least.

It also hasn’t gone unnoticed that Morneau has been a weak minister simply in the performance of his duties.  His inability to communicate means that he is completely ineffective at responding to his primary critic, Pierre Poilievre, sticking to scripted talking points that are complete non sequiturs to the questions being asked.  He doesn’t seem to be able to keep his staff under control, given what we heard about their campaign of harassment against Jody Wilson-Raybould during the Double-Hyphen Affair, and the fact that he let SNC-Lavalin pull his strings in crafting and inserting the Deferred Prosecution Agreement legislation into a budget implementation bill is a red flag that nobody seems to have addressed.  We also haven’t heard back about which minister’s office leaked that Statistics Canada job report, and Morneau’s office should be a prime suspect given this record of impudent behaviour.

The business community doesn’t see Morneau as accessible in the way that other ministers have been to consultations, and considering that he is supposed to be the one minister that should be the conduit to business, this is a problem.  This was very much demonstrated by the way in which Morneau and his office completely botched the small business tax changes, where they ham-fistedly tried to ram them through without consulting beforehand and needing to backtrack throughout that summer, and Morneau’s inability to communicate was seen by several observers as the incident after which the department of finance was marginalized in the current government – something that would be unthinkable in any other government.  And even if this government isn’t business-friendly, there should at least be a minister who can sell its vision to the business community.  That minister is not Morneau.

This isn’t to say that Morneau was completely useless over the past five years – he was initially brought in because of his expertise in pension reform, and he did accomplish that with the provinces early on.  But because that file is settled, and we are in a time of economic crisis, perhaps it’s time to shake things up and bring in someone who is more competent, and more importantly, can communicate the recovery plan to the business community at a time where they need it.  So if not Morneau, then who?  The obvious choice would seem to be Jean-Yves Duclos, who is currently the Treasury Board president, because of his economic credentials and the fact that he has proven to be a more effective communicator than Morneau.  Another backbencher whose name was put forward to me was Francesco Sorbara, a two-term MP from the GTA whose previous life experience was in global financial markets, and would seem to be more qualified than Morneau based on his CV alone.  Suffice to say, that as some provinces start shuffling up their own Cabinets, and the summer lull coming, it could be the prime opportunity for Trudeau to put someone with a bit more heft into what is going to be one of the most important portfolios for the coming few years.

Photo Credit: Jeff Burney, Loonie Politics

More from Dale Smith. @journo_dale

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