Federal Government & Politics II

[Build.It]

I've clearly hit a nerve, so I'll leave one final thought and then I'll drop it.

My responsibility is first to my family, followed by those I do business with, followed by friends, and then followed by neighbours. As long as I handle all those reasonably well and mind my own business, then my life is pretty good.

Ukraine and Russia have nothing to do with any of those priorities and I'm not willing to sacrifice those aforementioned priorities (in case this escalates into WW3) to save Ukraine. I'm sorry if that sounds harsh, but it's just how I see it.

[acottawa]

Originally Posted by Build.It

I've clearly hit a nerve, so I'll leave one final thought and then I'll drop it.

My responsibility is first to my family, followed by those I do business with, followed by friends, and then followed by neighbours. As long as I handle all those reasonably well and mind my own business, then my life is pretty good.

Ukraine and Russia have nothing to do with me and I don't see why I should have to be sucked into their war. When the rest of the world keeps funding it though, I am gradually getting sucked into it, even if it's by association.

[Djeffery]

I don't know how you can say it has nothing to do with you. We were sailing along fine in early 2022 coming out of the pandemic, and then that happened. Not to say that all the economic crap the world has dealt with in the last 2 years ties directly to that war, but a lot of it does. And all of this money you claim that we are sending to Ukraine isn't skids of cash. Most of it is value of goods already in our stockpile, and most of the rest is cash going back in to our economy and sending the goods to them.

[Truenorth00]

It's telling that libertarians don't understand how oligarchs imposing a change in capitalism to cronyism with war, could eventually impact them. They can't even understand that Putin and Xi despise capitalism and free enterprise and seek to remake the global economy in their image of cronyism and state controlled enterprise.

As said, they'd sell their executioners the rope used to hang them.

[KnoxfordGuy]

The fight in Ukraine is a fight for global democracy. Ukraine is keeping the wolves from entering the back door. We need to help them board up that door. Democratic nations around the world are sending a signal to Russia. Unfortunately, the battlefield is Ukraine.

[YOWetal]

Originally Posted by acottawa

The easiest thing for a government to do when confronted with a problem they don’t know how to solve is to create a bureaucratic unit. Once a new bureaucratic unit exists, it pretty much remains until the end of time.

Well if the end of time is the 2026 budget then sure.

Huge swaths of the bureaucracy are about to find out. Surely there will be lots of babies thrown out with the bath water by a very idealogicial Conservative finance minister but it is long overdue.

[Build.It]

Originally Posted by Djeffery

I don't know how you can say it has nothing to do with you. We were sailing along fine in early 2022 coming out of the pandemic, and then that happened. Not to say that all the economic crap the world has dealt with in the last 2 years ties directly to that war, but a lot of it does. And all of this money you claim that we are sending to Ukraine isn't skids of cash. Most of it is value of goods already in our stockpile, and most of the rest is cash going back in to our economy and sending the goods to them.

Do you seriously think that two countries with a combined GDP of only $2 trillion on the other side of the world, with whom we did barely any trade with has any meaningful impact on our economy?

China, who has a much larger GDP than Russia, and is our second largest trade partner, is currently in a major recession, and even that isn't having any meaningful impact on our economy.

The inflation and housing affordability crisis in Canada was caused by our own Central Bank and our own governments. Not by the war in Ukraine.

The only economic impact you could argue we felt was when gas briefly shot up to $2/L, but it plummeted just as fast and is now just as cheap as it was in 2018 if you remove the carbon tax.

[Truenorth00]

Originally Posted by YOWetal

Well if the end of time is the 2026 budget then sure.

Huge swaths of the bureaucracy are about to find out. Surely there will be lots of babies thrown out with the bath water by a very idealogicial Conservative finance minister but it is long overdue.

Easier said than done. Sure, some of the social policy bureaucracy (recently imposed) might be easy to disassemble. But (in my experience) a lot of the embedded bureaucracy are driven by regional considerations which governments find virtually impossible to ignore once in power. Why do we have so many economic development agencies that get a say in virtually every moderately large contract? Why do we build warships in Halifax when it would be half the cost to build them in South Korea? Etc.

The CPC will probably impose some blanket cut on government (say 10% across the board cut) and then chop specific bureaucracies. I don't think any of that will fundamentally change how the federal government operates though. That requires a more fundamental discussion on the role of the federal government and federal spending in Canada.

[acottawa]

Originally Posted by Build.It

Do you seriously think that two countries with a combined GDP of only $2 trillion on the other side of the world, with whom we did barely any trade with has any meaningful impact on our economy?

China, who has a much larger GDP than Russia, and is our second largest trade partner, is currently in a major recession, and even that isn't having any meaningful impact on our economy.

The inflation and housing affordability crisis in Canada was caused by our own Central Bank and our own governments. Not by the war in Ukraine.

The only economic impact you could argue we felt was when gas briefly shot up to $2/L, but it plummeted just as fast and is now just as cheap as it was in 2018 if you remove the carbon tax.

And what is your hypothesis for what happens if Russia wins the war?

Hint:look what happened to inflation and interest rates in the months following the invasion.

[acottawa]

Originally Posted by Truenorth00

Easier said than done. Sure, some of the social policy bureaucracy (recently imposed) might be easy to disassemble. But (in my experience) a lot of the embedded bureaucracy are driven by regional considerations which governments find virtually impossible to ignore once in power. Why do we have so many economic development agencies that get a say in virtually every moderately large contract? Why do we build warships in Halifax when it would be half the cost to build them in South Korea? Etc.

I am not sure you need specialized agencies to explain this to other bureaucrats. US defence contractors know they have to sprinkle contracts in nearly every state without being told that by a specialized agency. I am sure DND already knows they are going to have to build ships in Canada for political reasons.

[Build.It]

Originally Posted by acottawa

And what is your hypothesis for what happens if Russia wins the war?

Hint:look what happened to inflation and interest rates in the months following the invasion.

Are you implying that you believe inflation and rate hikes was due to the invasion? I just want to make sure I'm understanding you correctly.

[Truenorth00]

Originally Posted by acottawa

I am not sure you need specialized agencies to explain this to other bureaucrats. US defence contractors know they have to sprinkle contracts in nearly every state without being told that by a specialized agency. I am sure DND already knows they are going to have to build ships in Canada for political reasons.

Different motivations. American defence contractors do this to sustain Congressional support for their widgets. We don't have nearly the same political military industrial complex. Believe me, given the choice DND would happily source most of our kit from aboard and concentrate as much of what's left in Ontario and Quebec to make working easier and more efficient. The procurement and regional benefits aren't self-imposed. It's the reason we have all the economic development agencies, INAC, SOW, etc in the room inquiring about how avionics is contracted.

[MolsonExport]

Originally Posted by Build.It

Although I can nitpick a little with your statement, I'd agree he's probably a little misinformed.

Discriminating against/mocking anyone who drives a pickup truck is an equally extreme view though.

I can nitpick a little with your statement, as I am not discriminating against/mocking anyone who drives a pickup truck. But there is certainly a certain "type" and that goes without saying.

[MolsonExport]

Originally Posted by acottawa

x2

[acottawa]

Originally Posted by Build.It

Are you implying that you believe inflation and rate hikes was due to the invasion? I just want to make sure I'm understanding you correctly.

Part of the inflation and interest rates is Trudeau’s terrible fiscal policy, but the jump in early 2022 was certainly due to the invasion. It calmed down in the summer after Ukraine largely halted the Russian advance, resumed exports, refugees returned, etc. but if Ukraine is forced to surrender then all bets are off.

[casper]

Originally Posted by Truenorth00

Different motivations. American defence contractors do this to sustain Congressional support for their widgets. We don't have nearly the same political military industrial complex. Believe me, given the choice DND would happily source most of our kit from aboard and concentrate as much of what's left in Ontario and Quebec to make working easier and more efficient. The procurement and regional benefits aren't self-imposed. It's the reason we have all the economic development agencies, INAC, SOW, etc in the room inquiring about how avionics is contracted.

I think there is zero chance that a major multi-year ship building contract makes it way through any cabinet that involves laying off shipyard workers in Canada to build ships overseas.

I don't think concentrating the supply chain for the Navy in Ontario and Quebec will make anything easier and more efficient. Those fleets are based in Halifax and Victoria.

The current federal government has been reasonable to some extend. There are P-8s on order instead of business jets after all.

[YOWetal]

Originally Posted by Truenorth00

Easier said than done. Sure, some of the social policy bureaucracy (recently imposed) might be easy to disassemble. But (in my experience) a lot of the embedded bureaucracy are driven by regional considerations which governments find virtually impossible to ignore once in power. Why do we have so many economic development agencies that get a say in virtually every moderately large contract? Why do we build warships in Halifax when it would be half the cost to build them in South Korea? Etc.

The CPC will probably impose some blanket cut on government (say 10% across the board cut) and then chop specific bureaucracies. I don't think any of that will fundamentally change how the federal government operates though. That requires a more fundamental discussion on the role of the federal government and federal spending in Canada.

For sure it's not easy. A huge majority does allow them to piss off people for the greater good. I don't think the regional development agencies are even a rounding error in our budgets.

Most of our spending is not useless DEI people telling TrueNorth how to fight a war. Admittedly sure let's get rid of those but to get real savings we have to hit benefits to people or defence and public safety. Cutting child and elderly benefits and the staff that administer them is politically tough for sure. Health even more so and reform is out of the Feds control anyway.

Something radical like cutting benefits but eliminating the GST would be very deflationary and allow CRA (and businesses) to cut thousands of administrators. Sure economically income tax cuts would be better for productivity but eliminating GST starves government and binds the hands of any future government.

[Build.It]

Originally Posted by acottawa

Part of the inflation and interest rates is Trudeau’s terrible fiscal policy, but the jump in early 2022 was certainly due to the invasion. It calmed down in the summer after Ukraine largely halted the Russian advance, resumed exports, refugees returned, etc. but if Ukraine is forced to surrender then all bets are off.

Ukraine's total global exports in 2021 (pre-war) was $68 billion.

Total global trade in 2021 was $28.5 trillion.

Ukraine accounted for 0.2% of all global trade prior to the war.

Total Ukrainian imports to Canada in 2021 was $228 million out of a total of $631 billion in total imports for the year.

In 2021 Ukraine represented 0.03% of all Canadian imports.

The war in Ukraine didn't cause the inflation in Canada.

[acottawa]

Originally Posted by Build.It

Ukraine's total global exports in 2021 (pre-war) was $68 billion.

Total global trade in 2021 was $28.5 trillion.

Ukraine accounted for 0.2% of all global trade prior to the war.

Ukraine is a key exporter of numerous global commodities including wheat, corn, sunflower, buckwheat and steel. Driving up the cost of raw materials pushes up prices across the board.

If Ukraine surrenders millions of Ukraines will leave rather than live as Russian slaves, it will cost Western countries (including Canada) hundreds of billions to resettle and house these refugees. You think housing is expensive now?

[YOWetal]

Originally Posted by Build.It

Ukraine's total global exports in 2021 (pre-war) was $68 billion.

Total global trade in 2021 was $28.5 trillion.

Ukraine accounted for 0.2% of all global trade prior to the war.

Of that 0.2% Canada is a very very small trading partner.

I'm sorry, but the war in Ukraine didn't cause the inflation in Canada.

It definitively accelerated inflation. Partially because of sanctions on Russian gas and oil but also Ukraine is a major exporter of food which is in a delicate balance that was already disrupted by Covid. This caused a chain reaction to the already stressed food market as substitution cascades across the world.

But yeah a capitulation by Ukraine and removal of sanctions would be deflationary. Until China invades Taiwan and then try buying anything at Walmart. Unless we just agree with that too and wait until they stop all chip exports and we end up working for our Chinese AI overlords.