Mid-Week Post

Your middle-of-the-week gentle breeze ...

 

The new boss is the same as the old boss:

The Liberal caucus has voted against adopting the Reform Act, which would have given Liberal MPs the power to oust leader Mark Carney if they deemed him unfit to lead the party.

Liberal caucus chair James Maloney said Liberal MPs voted on May 25 not to adopt the act, but he declined to say anything more about the vote, insisting any discussions that happen in caucus meetings should remain private.

The Reform Act, which was introduced by Conservative MP Michael Chong in December 2013 and became law in June 2015, requires each parliamentary caucus to vote on the four key aspects of the legislation at their first meeting following a general election.

The four provisions relate to whether the caucus will have the ability to trigger a leadership review, appoint an interim leader, expel or readmit an MP, and elect or remove the caucus chair. Each of those processes can only take place if at least 20 percent of the caucus members vote in favour, according to the act.

The Conservatives voted to adopt all four aspects of the act at the start of the new Parliament in 2021 following the party’s loss in the federal election—using it to expel MP Derek Sloan from caucus that same year, and later to oust leader Erin O’Toole in 2022. The Liberals voted not to adopt the act both in 2019 and in 2021. The NDP and Bloc Québécois also voted against adopting the Reform Act in 2021.

By not adopting the act, the Liberals didn’t have the mechanism to eject former Prime Minister Justin Trudeau as leader when the party was down in the polls in 2023 and 2024. Trudeau rejected calls from his caucus to step down before finally announcing his plan to resign in early January 2025, a few weeks after Finance Minister and Deputy Prime Minister Chrystia Freeland quit in December 2024. Trudeau officially resigned in March after Carney was chosen by the party’s membership as Liberal leader.

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Elbows up, everybody!:

Cleo Carney, daughter of Prime Minister Mark Carney, has just finished her first year at Harvard. She is an undergraduate in the resource efficiency program and focuses her academic energy on sustainability. 

 

Let's believe in Canada until we don't. 

 

 

Well, bye:

It was the worst showing the federal party has had in a Canadian election. The last time it lost official party status was in 1993, when the NDP came away with only nine seats.

Besides reeling from the political blow that voters dealt the party, which saw Jagmeet Singh, its former leader, resign after placing third in his riding, the fact that New Democrats are returning to Parliament with only seven seats means it has lost many of the resources afforded to parties based on the size of their caucus.

Losing official party status means NDP MPs will be limited in how often they can ask the governing Liberals a question in the House of Commons, and will not automatically be reserved a place on parliamentary committees, where legislation flows before it is passed in the House of Commons.

While Davies said on Monday that it was “possible” for the governing Liberals to relax some of the rules around what constitutes official party status, as has been done at the provincial level across different legislatures, House Leader Steven McKinnon appeared cold to the idea.

“The law requires 12 members,” he told reporters earlier on Monday.

Davies said the NDP is now looking to see what may be decided by the Board of Internal Economy, which has not yet been struck.

 

That leaves only the Liberals as the official party of brain-drain and taxation.

 

Speaking of brain-drain and taxation: 

The share of native-born Canadians in the labour force has dropped nearly 10 percentage points since 2006, according to a new Bank of Canada report documenting how the country’s economy is becoming increasingly reliant on low-wage migrant workers.

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Delinquencies are rising even as Canadians are dialling back their credit card use. Average monthly spending per credit card holder in the first three months of the year was the lowest it has been since March of 2022, according to the report.

But consumers are also paying off a smaller share of their monthly credit card bills than they used to. The shift has been especially dramatic among those under 35, who are now paying just under $59 of every $100 on their credit card balance, down from nearly $63 a year ago.

The economic volatility of the past three years, which have seen inflation accelerate, interest rates go up and, more recently, jobless numbers creep up, has been particularly tough to navigate for younger consumers, who typically have lower incomes and less savings, said Ms. Oakes.

The unemployment rate among 15- to 24-year-olds was around 14 per cent in April, around twice the overall jobless rate of 6.9 per cent, according to Statistics Canada.

A shaky labour market may also help to explain why Ontario has emerged as what the report dubbed “a hotspot for financial stress in Canada.”

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The “typical Canadian”—defined as the median income earner—is currently taxed at an average of just over 17 percent (federal plus provincial). The upcoming tax cut will decrease that by about half a percentage point, bringing it to just under 17 percent.

But how much you pay in income taxes varies depending on where you live and how much the “typical” person makes in each province. In Nova Scotia, where income taxes are highest, someone earning the provincial median income pays one-fifth of their income in tax. Those in British Columbia and Ontario pay the least, at 15 percent. Meanwhile, median earners in half of Canada’s provinces—including Quebec, Manitoba, and Saskatchewan—pay somewhere in the middle at 18 percent.

All that said, are those numbers high? They are when you look across the border.

Median income earners in every U.S. state have a lighter tax burden than Canadians do—usually by a lot. In California, often thought of as a high-tax state, the median income earner’s combined tax bill is 10 percent—the U.S. average. That falls to just 7-8 percent for the nine states with no state-level income tax, like Texas, Florida, and Washington. 

To put that into perspective, if Canada’s combined average income tax rate were the same as in the U.S., the typical Canadian would save almost $4,000 a year. But even seemingly small tax cuts can have an impact, like the change coming on July 1st—it reduces the lowest federal tax bracket by one percentage point, and will save the typical Canadian around $400 a year. 

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So how great is the gulf between them? Statistics Canada shows a 65-67% gap between average Millennial household wealth ($493,423) and the equivalent figures for Boomers ($1,397,609) and Gen X ($1,485,654). On top of this, there is said to be $1 trillion in Boomer wealth set to be passed down soon, but even this is in doubt given longer lifespans and this cohort’s tenacity in holding on to what they have.

The reason for this disparity is real estate, which props up the economy. Young Canadians have either been excluded from homeownership by high prices and interest rates, with big cities like Robertson’s Vancouver and Toronto among the two most unaffordable cities in North America; or they are new homeowners who managed to buy properties but are now squeezed by rising mortgage payments.  Older Canadians meanwhile have seen the value of their properties soar over a much longer period.

 

 

Behold! The Canadian legal system:

While Yun Lu "Lucy" Li was waiting to go on trial for first-degree murder, she breached her bail conditions to eat lunch at a restaurant with a potential Crown witness, work out at the gym in her sister's luxury Toronto condo and use her cellphone unsupervised.

The cost for the breach: $1 million to her mom, Hong Wei Liao, as ordered by Justice Andrew Goodman in a Hamilton courtroom May 16.

"She never imagined for a moment that her daughter would ever do something as thoughtless, selfish, irresponsible," said Liao's lawyer William Smart.

(Sidebar: really?) 

Li is currently serving a life sentence with no chance of parole for 25 years for murdering Tyler Pratt and attempting to murder Jordyn Romano after a jury found both her and her partner Oliver Karafa guilty a year ago.

But before the trial, in December 2021, Liao had pledged $2 million when she signed as a surety for Li after what Goodman described as a "hotly contested" bail hearing, which he presided over. Three of Liao's friends, including Nam Sook Bae, also became sureties and committed another nearly $1 million.

A surety is someone who agrees to ensure the person out on bail meets their court-ordered bail conditions.

Bae is now required to forfeit $50,000 of the $200,000 she pledged.

 

(Sidebar: the family name is Nam, not Bae. Typical CBC.)