The West Block Transcript: Episode 41, Season 6

THE WEST BLOCK

Episode 41, Season 6

Sunday, June 18, 2017

Host: Vassy Kapelos

Guest Interviews: Prime Minister Justin Trudeau, David Atkin, Josh Wingrove

Location: Ottawa

On this Sunday, as we approach Canada’s 150^th birthday celebration, what is Canada’s role in the world? We’ll sit down one-on-one with the prime minister to ask him about the relationship with our southern neighbour and why his government is turning to China.

Then, we’ll ask Justin Trudeau about his domestic agenda. As the deficit continues to grow, will he ever commit to balancing the books? And why is the government struggling to push through so much of its agenda?

Plus, we’ll unpack the politics of our conversation with the prime minister and what’s on the table for the government as we head into the final days of this session on Parliament Hill.

It’s Sunday, June 18^th; Happy Father’s Day. This is The West Block, and I’m Vassy Kapelos.

As Canada prepares to celebrate its 150^th birthday in a couple of weeks, many are looking to our country to take on a bigger leadership role on the global stage. Is the government prepared to take on that role? And what does it mean for the relationship with our neighbours to the south, and most especially with the Trump administration?

Joining me now is Prime Minister Justin Trudeau. Prime Minister, great to have you on the set

Prime Minister Justin Trudeau: Great to be here, Vassy.

Vassy Kapelos: Thanks for coming on the program and Happy Father’s Day by the way.

Prime Minister Justin Trudeau: Thank you.

Vassy Kapelos: I wanted to start off by asking you, I know we’re fast approaching Canada’s 150^th birthday, and your government has often lately talked about our place in the world. I wanted to ask you about a quote Minister Chrystia Freeland or her address basically, a quote from that address. She’s talking about the U.S. here. She says, “The fact that our friend and ally has come to question the very worth of its mantle of global leadership puts into sharper focus the need for the rest of us to set our own clear and sovereign course.” What concretely does that mean?

Prime Minister Justin Trudeau: Well it means something Canada’s always done, which is we’ve always been independent minded about our place in the world. We understand the advantages and the opportunities that come with being so close to the United States, but we’ve also always recognized that we need to and can set our own course in terms of how we engage with the world, whether it’s areas of disagreement like how we approach Cuba or how we engage constructively in multilateral organizations like the UN. These are things that matter to Canadians and there are ways that we can punch up of our weight on the world stage.

Vassy Kapelos: Was it meant to be a knock at Donald Trump at all?

Prime Minister Justin Trudeau: I think it’s a recognition that the United States is going through a moment where it’s turning inwards a little bit more and that doesn’t make the challenges around the world that we’re facing any less, whether it be on the Paris accords and climate change or global security, which is why Canada’s always happy to step up and more than pull its weight.

Vassy Kapelos: I want to ask you about Donald Trump because there are millions of Canadians and tens of millions of Americans who are watching the news every night sort of watching it all unfold. You, unlike most of us, have had a number of interactions with him. What’s he like?

Prime Minister Justin Trudeau: You know he’s very consistent in public and in private. He’s someone who speaks his mind and is very aware of the mandate he got elected to fulfill. He talked about making America great again and focusing on helping—

Vassy Kapelos: He actually used that term with you?

Prime Minister Justin Trudeau: Well he focuses on helping people who feel like they’ve had a raw deal over the past years with globalization and that’s very similar to our focus on supporting the middle class and on creating opportunities for all Canadians. So we find points of agreement on how we’re going to move forward in ways that are going to benefit ordinary families across our countries.

Vassy Kapelos: Have you ever met anyone like him before?

Prime Minister Justin Trudeau: One of the great things about my job is I meet every type of people in this job. I get to meet a huge range of individuals who all have different approaches and different perspectives. And as I say when I’m internationally, I am Canadian. I can work and get along with anyone.

Vassy Kapelos: How would you describe though your differences with President Trump in one sentence?

Prime Minister Justin Trudeau: I’m Canadian and I will always stand up for Canadian values of openness, respect, long-term thinking around both the environment and the economy. And that’s not a knock on anyone else, it’s just the approach we have as Canadians of understanding that leaning on each other and working together and being open to people from around the world is one of the things we do very, very well.

Vassy Kapelos: Do you respect him?

Prime Minister Justin Trudeau: I think my job is to work with any president and I think one always respects the office.

Vassy Kapelos: Do you respect the person?

Prime Minister Justin Trudeau: Of course.

Vassy Kapelos Do you trust him?

Prime Minister Justin Trudeau: I’m going to work with the president on what’s in the best interest of Canadians. I trust him to be focused on what’s in the best interest of Americans and the fact that we can work together in ways that enhance jobs and opportunities for us on both sides of the border, I think is something that is going to be a significant benefit to Canadians and to Americans.

Vassy Kapelos: Speaking of trust, while the uncertainty surrounding the trade relationship between our two countries exists, your government has definitely shifted focus to other areas of the world, especially China. And I wanted to ask you about the approval of the Norsat takeover by a Chinese company. Why didn’t the federal cabinet—why didn’t your cabinet ask for a full-scale national security review of that?

Prime Minister Justin Trudeau: Well first of all, in terms of shifting our focus, we’re shifting our focus all around the world. Yes, we’re looking at the Pacific, but we also are celebrating the close to implementation of CETA, the trade deal with Europe. It’s going to make a huge difference in terms of Canada’s access to a massive market in Europe and opportunities for our businesses. So that’s very much something that we’re looking at, being more engaged in the world in constructive positive ways. The Investment Canada Act has a number of steps we go through when we’re looking at purchases or acquisitions by countries such as China and we make sure that all those steps are appropriately followed. We trust our national security agencies when they examine and make an assessment and make a recommendation and then we follow through on that recommendation.

Vassy Kapelos: So there’s nothing special about China, a Chinese company taking over a Canadian one, especially of this nature, a high-tech company? I mean obviously concerns have been raised by the U.S. that there’s a risk there.

Prime Minister Justin Trudeau: Well that’s exactly why we engaged in a proper process with. The national security agencies look at any given deal under the Investment Canada Act. Consult with our allies, in this case including the United States, to hear their perspective on this.

Vassy Kapelos: Who did you consult with in the U.S.?

Prime Minister Justin Trudeau: Our national security agencies consult with national security agencies in the United States. There’s a whole process that gets followed and we follow that process.

Vassy Kapelos: So no concerns were raised that I guess were valid or deemed valid?

Prime Minister Justin Trudeau: We follow the recommendations that our national security agencies give us on this. We take national security very, very seriously and we trust the public servants whose job it is to look into this to keep Canada safe, to do a great job.

Vassy Kapelos: Okay, we’ll leave it there. We’ll be back in a few minutes, more of our conversation with the prime minister. Stay tuned.

Vassy Kapelos: Welcome back. We’re going to pick up on our conversation with the prime minister. And Prime Minister, I want to kind of switch things back to home ground, back here in Canada. In the election you made a very specific promise about the deficits and how big they would be, $10 billion, they would be eliminated after five years. They’ve obviously now grown in size and there is no projected end in sight. Will you ever commit to a date, a specific date for balancing the books?

Prime Minister Justin Trudeau: Our decision to invest in Canada, in communities, in infrastructure, in support for the middle class by lowering taxes on the middle class, raising them on the wealthiest one per cent, delivering a Canada Child Benefit that helps 9 out of 10 Canadian families with tax free money every month, more money and lifts hundreds of thousands of kids out of poverty was made because we recognized that the Canadian economy needs better growth, needs better opportunity, needs investment for today and tomorrow. That’s why we put forward the ambitious platform that we did and why we’re following up on our promises.

Vassy Kapelos: I understand that you have a justification for running the deficits, but is it just forever?

Prime Minister Justin Trudeau: No, it’s—

Vassy Kapelos: But your government hasn’t articulated that it will end.

Prime Minister Justin Trudeau: In the electoral platform, we committed to about $10 or $11 billion of new spending. What did we deliver on first budget? About $10 or $11 billion of new spending, so we’re actually keeping our promise. The problem is the economic situation the Conservatives left us combined with the challenge around oil prices. It meant that the floor was lower. We recognize that, but the problem remains this country needs growth after 10 years of sluggish growth under Mr. Harper. We need opportunities. We need to put money back in the pockets of the middle class and that’s exactly what we’ve been doing. And the reason we’re doing it is because we need to create that economic growth that’s going to give Canadians opportunities, give people good jobs, give the next generation the capacity to succeed. That’s what this investment is all about, and that’s what we’re focused on.

Vassy Kapelos: But with all due respect, that investment is all fine. I don’t understand how spending the money precludes you from saying when you will balance the books or that you will get back to that situation at some point because you did in the campaign.

Prime Minister Justin Trudeau: Because for example, the investments we made just recently, historic amounts in public transit in Montreal, in Ottawa, elsewhere across the country, going to create good jobs, going to create an ease for businesses and people to get to work and back. These kinds of things end up growing the economy in meaningful tangible ways, both through the construction phase of good jobs and design, engineering and construction, but also because our communities do better when people can get to and from work better and more efficiently, not wasting as much time in traffic. That leads to economic growth in a significant way. We know that that’s what it’s going to do. How long that’s going to take? What kind of trajectory that is, we’ve made strong projections around that, but that’s exactly what we’re trying to do better than and that’s our focus.

Vassy Kapelos: Do you understand how some Canadians might be concerned when they hear for example, the Bank of Canada governor say over and over how personal debt is in a crisis situation. It’s too high. Don’t do it. Don’t take on too much debt. Why is it okay for you to do it and not us?

Prime Minister Justin Trudeau: The fact is Canada needs investment, particularly in infrastructure. We know that investing in public transit, investing in flood protection, in green infrastructure, investing in low income housing, investing in child care, investing in the kinds of things that are going to give advantages to Canadians so that they can better succeed are smart investments for the future. Now other governments and other political parties proposed to cut their way to balance. We know that in order for Canada to succeed, Canadians need to succeed. That’s the promise we made to Canadians. Those are the investments that are going to grow the economy that we are delivering on.

Vassy Kapelos: Let me ask you about the Budget Implementation Act that is supposed to implement a lot of these measures. It’s kind of stuck in the Senate right now. Is this what you envisioned when you sort of triggered a redesign of the Senate by releasing Liberal senators from being Liberals and appointing “independent senators”? Is this what you wanted?

Prime Minister Justin Trudeau: Yes.

Vassy Kapelos: You wanted the Budget Implementation Act held up in the Senate?

Prime Minister Justin Trudeau: I wanted a Senate that actually takes its job seriously of reviewing in a non-partisan way or a more independent minded way, legislation put forward by the house, making recommendations. The issue around budgets of course is it’s the House of Commons that votes on budgetary measures and the Senate is of course welcome to look at it and make recommendations, perhaps make suggestions as well, but the legitimacy happens from the House of Commons on this and we’re expecting that budget to be passed speedily. But we also recognize that the learning process of having a less partisan, more independent Senate is all a part of what we’re going through right now and it doesn’t surprise me that it’s happening this way. And I look forward to having this budget passed quickly.

Vassy Kapelos: They may be less partisan and more independent, but they’re not elected. They’re unelected. Should they have that much power?

Prime Minister Justin Trudeau: Well they would have more power if they were elected.

Vassy Kapelos: What do you mean they’d have more power? These are unelected people who are essentially now able to try to re-write legislation or hold it up, like something like the budget which is a big deal.

Prime Minister Justin Trudeau: Wait a second, and you think that if they were elected with the mandate they wouldn’t hold up a budget? They wouldn’t feel more empowered?

Vassy Kapelos: Well they would have some responsibility to Canadians would they not? Isn’t that the role of elected officials?

Prime Minister Justin Trudeau: No, they would have more legitimacy, more weight because they’ve a direct mandate to do more things. But would they get re-elected if they were elected?

Vassy Kapelos: It depends.

Prime Minister Justin Trudeau: We’re getting into the weeds here.

Vassy Kapelos: Right?

Prime Minister Justin Trudeau: We’re getting into the weeds here. We have a Constitution—

Vassy Kapelos: I mean that was the concern that prompted you to change.

Prime Minister Justin Trudeau: We have a Constitution and a Supreme Court judgement that said you can’t do that. And instead, what we’re doing, what we did in transforming the Senate after 10 years of Stephen Harper promising and being unable to do anything is we actually made a Senate that is freer from partisanship, more independent minded and doing the real work of advising, recommending, doing studies and being a thoughtful place of sober second thought. That’s what the Senate is supposed to do and that’s exactly what it’s doing. We welcome the work that they’re doing. We will take note of the recommendations they make, but on the issues of budget it’s a well-established fact the Senate differs on money bills, on budget bills particularly to the legitimacy of the House of Commons.

Vassy Kapelos: We’ll see how independent they are then. Thanks a lot for your time, Prime Mister, great to have you here.

Prime Minister Justin Trudeau: It’s a pleasure, Vassy.

Vassy Kapelos: Up next, we’ll unpack the politics of our conversation with the prime minster and what’s on the government’s agenda in the final days before the House rises for the summer.

Vassy Kapelos: Welcome back. We’ve just heard from the prime minister on a number of issues. Joining me now to unpack the conversation and what it means, our own David Atkin, chief political correspondent and Josh Wingrove with Bloomberg News. Thanks guys for being here.

David why don’t I start with you? You know you like to report on deficits, as do I. No answer from the prime minister. I tried, but no answer as to when they actually might—a date for when they might get back in the balance.

David Atkin: I’m so confused why this is such a hard question for him to answer. I remember he once got asked by a reporter if he smoked pot and he was able to answer that question more easily than this one. It’s odd because I know there are a lot of Liberal MPs who wish their own government would have this answer for their own political fortunes because their voters, their constituents want to know when this is going to happen. He said to you, he talked about the idea that we have slow growth and he’s not sure. That’s not really true. We have terrific growth. Growth right now is the best in the G7. Our economy’s actually performing pretty well and that means the deficit will probably be a little lower. And it means he should be able to look good and give us a number, a year, 2025? 2022? 2020? It’s confusing why he doesn’t get to this one.

Vassy Kapelos: Yeah it was easy, Josh, during the campaign. They were very distinct. You know five years we will eliminate our $10 billion deficit. What changed in the past year and a half or 18 months that he no longer can offer that date?

Josh Wingrove: I think it’s something between what the Conservatives say and what the Liberals say and we’d be shocked to know, like—

Vassy Kapelos: It blows me away.

Josh Wingrove: Yeah, exactly. There’s merit to him saying their first budget had only $11 billion new spending. They monkeyed with the previous year to sort of pile in more. So they are spending more than they said, but it’s also true that the oil crisis or oil dropped the bottom out for a lot of the government revenues. So they’re sort of getting it from both directions, but I think his main problem is they’ve announced new defence spending. They’ve announced all these big ticket items. They changed OAS. You know people don’t realize how much money that is. It’s a ton, billions and billions a year. And their Canada Child Benefit, their flagship program is $22.5 billion a year. They’re doing this all without major tax changes. No GST hike for instance, and things like that, which I think some Liberals secretly would privately admit they would consider doing. So at the end of the day you’re either going to have to really hope the economy takes off or cut spending or raise revenue one way or another. And he just seems not to want to do that. That being said, these deficits are not that huge in the scheme of things. You know the bond market in Canada is healthy. There’s a lot of appetite for Canadian debt, so I know that sounds like a super boring argument for a Sunday morning. But other countries are in way worse debt trouble than we are, so he has room to continue doing this. He frankly has room to go higher if he wants to.

David Atkin: And politically any time there’s been polling information, we often find Canadians do not vote a government in or out based on the deficit. The deficit is not a ballot box question. That said, there has been some recent polling information. Angus Reid was out last week saying that the deficit is an increasing concern to Canadians. Stewardship of the economy is an increasing concern and this particular poll said that, believe it or not, Andrew Scheer, the new Conservative Opposition leader who 3 in 10 Canadians still don’t know, is rated as better on the economy than Justin Trudeau. So that might be a problem for the Liberals down the road if they don’t somehow show Canadians we got the deficit, we’re okay on the economy. I think that’s still a bit of a vulnerable spot for them.

Josh Wingrove: And remember there’s concern about a potential housing crunch and that would be huge for the Canadian economy. And we haven’t had a recession in nearly a decade and recessions tend to come around every once in a while.

Vassy Kapelos: They do.

Josh Wingrove: And so if something bad happened, this deficit’s going to get a lot worse.

Vassy Kapelos: So I also found his comments on the Senate and its intent, what it should be doing kind of interesting. What was your takeaway from—I mean the question I had asked was whether this budget implementation bill which is currently being—it’s in the Senate and they’re saying it’s an omnibus bill and they want to take out a section of it. Is that really what the Senate is intended to do? And his answer was “yes”.

Josh Wingrove: Yeah, the Senators are like two dogs ripping apart a steak. You know it’s bizarre to watch. This is almost unheard of for a lot of people in Ottawa. The Senate usually very rarely monkeys with government bills at all.

David Atkin: And a budget bill.

John Wingrove: And a budget bill in particular is just some of them—I kind of feel for senators who feel you know we’ve been taking it on the chin for three, four years now, we need to do something and they see what they think is a legitimate cause here. But in the last few days we’ve noticed a real tone shift from this government that basically boils down to you better stop monkeying around with our budget bill or there’s going to be heck to pay one way or another. And so I think that the prime minister has really changed his tone, starting around Friday and we’ll see sort of whether that threat rings true. Bill Morneau did the same thing, but you know he said to you, Vassy, that he thinks that yes this is wants the Senate. I have trouble buying that. I have trouble envisioning that he expected his budget bill to be delayed.

David Atkin: There was so much discussion at the time when he cut his senators loose and said he would do this that of course this is going to happen. And I’m on record, I thought it was a terrible idea to make the Senate a place where there was no party caucuses and I’ve long said if I was ever angry at a senator like Mike Duffy, for example, I could at least take it out on Stephen Harper at the ballot box. I can now no longer take out my anger or frustration on the Senate on any elected person. And there’s just even that little sliver of legitimacy the Senate used to have when it was partisan that I could punish or whatever an elected official, it’s not there. And of course this was the end result of the changes that Trudeau proposed and here they are running around like a bunch of you know like trying to herd cats or like dogs with the steak. It’s whatever you use for your metaphor, it’s crazy.

Josh Wingrove: In the Senate’s defence, so this week they did pass the C16, I believe the Trans Rights bill. That was a bill that the previous Senate just monkeyed around with in its own. They let it die and found ways to keep it—

David Atkin: But I’ll bet if there’s a Liberal caucus Senate, a Liberal dominated Senate would pass that bill, right?

Josh Wingrove: Of course. Of course. Of course.

David Atkin: That’s not a bill that doesn’t get passed or passed because it’s an independent Senate.

Josh Wingrove: But I just mention it as an example of a bill that did make it through the Senate.

Vassy Kapelos: Eventually, it took a while too.

Josh Wingrove: It did. It did, but it’s not like the Senate is totally ground to a halt right now. But this government thinks that this budget bill is going to get through. Whether that means that they’re cracking heads behind the scenes, I don’t know.

Vassy Kapelos: I bet this weekend they will be.

David Atkin: Yeah.

Josh Wingrove: Yeah.

Vassy Kapelos: Before we go, I want to touch also on the prime minister’s comments on Donald Trump, of course big subject of interest for a lot of us, I think. He said that he respects him, not only the office, but respects him as a person. What did you make of that? Josh?

Josh Wingrove: I think that’s true. I mean they have really tried to bite their tongue on Trump. They have not taken the bait. We saw in the last week Brian Mulroney said that that’s exactly what they should be doing. He’s been one of the advisors to Trudeau on the Trump issue. I think that Canada has more to lose than any other country for picking fights with Trump. Emmanuel Macron in France, Angela Merkel in Germany, they’re in election cycles right now. They’re picking at Trump because it helps them politically at home. Even if it would help Justin Trudeau at home, nearly two thirds of Canada’s total trade is with the U.S. We are just way too exposed to some sort of explosion in Canada-U.S. ties to be playing with fire. So I think that we’re going to continue to see Trudeau take that approach. There has been a tone change though in government.

Vassy Kapelos: A little bit.

John Wingrove: You’re starting to see ministers start to poke back at Trump in a way that is you know measured, but it’s not all fawning like it was in the days after his election.

David Atkin: And it’s never going to be personal, and that is a message that the Trudeau cabinet and Trudeau himself understand you make it personal with Trump and you’re right, we’re going to pay for it. So when we are pushing back it’s really on some policy based things and we’re trying to put some evidence out, different world view. I loved the question was what’s he like in private? And his answer was along the lines of he’s consistent. He searched for a few minutes to give that description and I can just think. And to think that that big bombastic Trump that we see on TV is the guy you get when you’re having coffee with him, it must be a handful to deal with. Trudeau’s obviously very diplomatic, etc. but it was interesting to watch him sort of search for the right word there. I really enjoyed that live question.

Vassy Kapelos: Well I’ve got to leave it there. Thanks so much guys, really appreciate the debrief.

That’s our show for today. For all of the dads watching, including my own very special father, Happy Father’s Day.