On Monday, September 20, Canada reelected Justin Trudeau’s Liberals to another minority government over the opposition Conservative Party. Both establishment parties promised working-class constituencies a recovery from the ravages of the pandemic. But a look at the fine print reveals that the results of this election will likely deliver little to the working-class communities hardest hit by the difficulties of the last year and a half.
On August 15, Justin Trudeau dissolved Parliament for a federal election. His first speech warned that resurgent COVID-19 infections and a possible near-term “global recession” would have grave consequences for future generations.
His gloomy outlook appears justified. In 2019, a federal report on metal-producing industries noted that, even before the pandemic, much industrial production was already weakened by a “global oversupply.” Weak exports in steel, cars and car parts, mining, and the like saw GDP growth slip to its slowest in four years.
Export-dependent areas have been hit especially hard. Homelessness has soared in Oshawa and Windsor, risen by nearly half in Cambridge, overwhelmed shelters in Hamilton, and reached crisis levels in Sarnia. The parliamentary budget officer isn’t anticipating a rebound to 2019 GDP for several years.
Many of these communities had only just recovered from the layoffs, cutbacks, and plant closures of 2008–9. These included the ravaging of Oshawa’s General Motors (GM) plant, Windsor’s GM transmission plant, all but one of Hamilton’s steel mills, Leamington’s Heinz plant, and others. Today, the future of GM Oshawa’s retooled “pop-up” production is uncertain. Hamilton’s postindustrial renewal campaign — touted with the injunction, “live, work, play, and learn” — has yet to deliver much. Windsor has among the highest unemployment rates in Canada.
Facing a public unenthusiastic about the election and unnerved by Trudeau’s forecast, the Liberals released a last minute platform on September 1 called Forward. For Everyone. The platform largely doubled down on earlier commitments — albeit with previously announced benefit cuts intact.
O’Toole of Management
The Conservatives, led by former corporate lawyer Erin O’Toole, campaigned by capitalizing on feelings of precarity. O’Toole expressed dismay at plant closures, and even claimed he and the Conservatives shared goals with many union organizations: “Jobs for their members and strong economic futures for their families.” The press has made much fanfare of the Conservative’s seemingly pro-worker platform. One liberal journalist even mused that O’Toole might be a “socialist crusader.” In reality, much of the Tory platform would have actually weakened workers’ rights.
The Conservative Party’s plan to require large federal employers to include “at least one” employee representative at the board level makes no mention of “unions.” In August, the Canadian Broadcasting Corporation quoted O’Toole’s explanation of how he wants to “give workers a real voice within companies to support the long-term success of their employer.” With revenues slowing, however, this will likely mean cutting costs. Furthermore, many of Canada’s most anti-union employers, like Honda, already allow workers to occupy “associate relations” seats as a “sounding board,” to achieve optics similar to those desired by O’Toole. Such a strategy allows companies to cut across organizing drives, improve messaging, and provide workers with a means of letting off steam tolerable to their employers.
O’Toole’s platform also included clauses to exempt “gig workers” from Canada Pension Plan (CPP) and Employment Insurance coverage in favor of an “Employee Savings Account.” This plan very closely resembles Uber’s Flexible Work+ proposal to create a “permanent underclass of workers.” In 2018, O’Toole supported a bill to empower employers to more easily cut their company pension plans.
Despite common misconceptions about the party’s leftward shift, it continues to support a slew of regressive policies. The Conservative Party advocates right-to-work legislation, strikebreaking, and cuts to support for the unemployed. Its costed platform included cuts to health care and childcare. All of these measures would make life harder for workers.
One Set of Policies for Two Parties
That Canadian media has presented O’Toole as a moderate throughout the election cycle reflects the fact that he and the Liberals — Canada’s “natural governing party” — agree on quite a lot. Like the Tories, Trudeau’s Liberals committed to cutting emergency benefits for unemployed workers, while doing nothing to crack down on employers who’ve used bailout money to fund scabs.
O’Toole and the Liberals also appear to hold many of the same views on workers’ pensions. In 2016, the Liberals introduced their own version of O’Toole’s private members bill to allow federally regulated employers to water down pensions.
O’Toole has made common cause with at least one leading Trudeau Liberal. Speaking against Bill C-26, which sought to increase the amount paid out under the public CPP, O’Toole argued that there is “no retirement crisis in Canada.” As evidence, he cited the book Real Retirement, cowritten by Liberal ex-finance minister Bill Morneau, that, among other things, argues: “Accepting reduced compensation goes against the grain of the labor movement, but it is in the best interests of employees to be open to the idea.”
Both Liberals and Tories have claimed to support workers who fear they may lose their jobs. Nevertheless, both rule out any measures that seek to constrain the free flow of capital in and out of communities. The Conservative platform explicitly pledged to maintain and expand the “free flow of capital investment” in and out of Canada.
Trudeau’s ghostwritten memoir, Common Ground, notes that his first task as Liberal leader was to get in touch with the party’s 1990s past — imposing austerity and privileging capital flows over worker protections. While acknowledging the “big structural changes” that were happening “in the economy” are “making life harder,” Trudeau wrote that his party would still staunchly “favor free trade, practice fiscal discipline, and support foreign direct investment.”
Both the Liberals and Conservatives support spurring investment through the federal government’s existing Regional Development Agencies (RDAs). Since they were created in 1963, these agencies have operated under various mandates, such as the need to close regional gaps, “chase smokestacks,” and build research infrastructure. The Conservatives set up the most recent such RDA, the Federal Economic Development Agency for Southern Ontario (FedDev Ontario), after the 2008–9 crash to subsidize manufacturing regions. Its main task, with over $2 billion, was to “de-risk” productivity enhancements with subsidies and to help companies access capital, with the help of the federal government’s Business Development Bank of Canada (BDC).
With an expanding market through the postwar boom, key Canadian cities and their officials — especially in Ontario — were, according to the Organization for Economic Cooperation and Development (OECD), made “‘salesmen’ whose primary duty was to recruit major manufacturing facilities.” By the 1970s, as Steven High notes in Industrial Sunset, the United States and Canada were facing growing international competition and domestic markets that weren’t keeping pace. Canadian plants, meanwhile, were often less productive than their US counterparts. Because the lack of a domestic market made taking advantage of scale difficult, the federal government began subsidizing these areas.
RDA subsidies did help some clear the costs of updating their equipment and machinery, but subsidies alone couldn’t generate a greater market. Consequently, RDA policy throughout the decade was combined with the promotion of mergers and consolidation. At the same time, industry was slowly tilting towards just-in-time production. Both jobs and regional economic gains were lost — including at companies that took RDA subsidies.
“The post-war compromise,” High noted, “did not extend to plant closing agreements.” This was further demonstrated in November 2002, as High notes, when a judge found that the Sturgeon Falls paper mill, Ontario’s largest employer, took subsidies to continue production. But it was impractical to order “the defendant to operate without a market.” In the case of such closures, the BDC advises employers on “how to lay off workers without ending up in court.”
Companies often acquire subsidies only to use their more secure position to attack workers later. After 2008–09, the federal government gifted both GM and Chrysler multibillion-dollar bailout loans and help with restructuring to ensure that “all-in labor costs” were “reduced.” Over the next few years, the car manufacturers thanked the public by laying off workers. More recently, the enormous subsidies made available to corporate Canada through the Canada Emergency Wage Subsidy and similar programs have also been redirected towards share buybacks and bigger bonuses.
In a discussion of the election, one CBC panelist called the results worrying — this election’s outcome represents the second time now that neither establishment party has managed to energize more than a third of voters. But the results are not really surprising. Neither establishment party can offer improved prospects for ordinary people.
The Liberals have, at most, temporary supports on offer. The Conservatives, in spite of the Red Tory sheen of their latest platform, offer workers, if possible, even less. The labor movement and its organizations, if they are to offer workers any improvements, need to be ready to fight both the Liberals and Conservatives — regardless of whatever kind and gentle feelings the party leaderships purport to hold.