Right-wing alliance will undermine Alberta carbon tax

Significance The Progressive Conservatives and the Wildrose party voted to merge with each other and contest the next provincial election in 2019 united as the UCP. The new bloc poses a significant threat to the province’s left-leaning New Democratic Party (NDP) government and to climate policy in Alberta and across the country. Impacts An Alberta-British Columbia spat over pipeline development seems inevitable whichever party wins in 2019, forcing Ottawa to intervene. The NDP government will increase borrowing as the election draws close to finance popular social programmes. Cheaper alternatives will undercut the Alberta oil sands even if a UCP government brings in deregulation.

Significance The three main parties -- the leftist New Democratic Party (NDP), the centrist Liberals, and the right-wing Conservatives -- are nearly tied in national voter intention polls. While the effects of Canada's first-past-the-post voting system appear to give the Conservatives and the NDP better chances at winning a plurality of seats in parliament, all three parties have a chance at victory, an unprecedented situation in Canadian history. Impacts The death of refugee Alan Kurdi has resulted in all three parties promising to expand Canada's acceptance of refugees from Iraq and Syria. The longer campaign could result in a doubling of the election's cost to the taxpayer. Both the NDP and the Liberals have promised that this will be the final election using the first-past-the-post system.


Significance The Trudeau government is proposing to limit tax advantages for small businesses in Canada, a move that has ignited widespread concern and criticism from business owners, business and professional associations, provincial premiers, opposition parties and backbench members of parliament within Trudeau's own party. The administration is facing difficulties halfway into its electoral mandate as it tries to implement the activist policy agenda on which it ran in the last election. Impacts Moving left on tax may win support from New Democratic Party voters, but Liberal climate policy remains a major hurdle for progressives. The provincial political landscape is likely to become less favourable to the Liberals before 2019. Trudeau’s personal popularity limits the space for the opposition to rise in the polls.


Significance Trudeau’s government has been held up as a bulwark of liberalism given the surge of anti-immigration populist candidates and parties in Europe and the United States. However, two leadership candidates in the Conservative race have sought to ape the political style and policy agenda that brought Donald Trump to power in the United States. Mainstream Canadian political actors are seeking to either counter or benefit electorally from rising distrust in government, fears over immigration and integration, and communitarian focus on Islam within right-wing politics. Impacts Opposition to the Trump presidency may help unify fractious left-leaning Canadian voters behind the Liberals. However, the social-democratic New Democratic Party will cite Trudeau-Trump cooperation to peel off progressive voters. Alienation of anti-immigration Conservatives will increase under libertarian or pro-business leadership.


Significance Canada’s oil sands are some of the biggest oil deposits in the world, holding hundreds of billions of barrels, but face an uncertain future. Dogged by high costs and environmental questions, international investors have mostly turned their backs on the heavy-oil projects. In their place, a small group of Canadian producers has consolidated production and will forge the longer-term outlook for the industry. Impacts Further oil sands asset sales from international majors such as Chevron could create more opportunities for consolidation. Fewer, but larger, operators will give producers more bargaining power with their service and equipment providers. Growing oil sands production will deliver more carbon tax revenue, alleviating some strain on Alberta’s public finances.


Subject Canada's federal political outlook. Significance Canada’s three main parties have all selected the leaders with which they will contest the 2019 federal election. New Democratic Party (NDP) leader Jagmeet Singh, Conservative leader Andrew Scheer and Prime Minister Justin Trudeau of the Liberal Party now have two years in which to define themselves for the electorate and make a case for their parties to assume or resume control of government. Impacts Fallout from fundraiser links to the Paradise Papers tax avoidance controversy could undercut Trudeau’s Liberals. Trudeau’s strong Quebec ties will help him hold off the NDP, but Ontario losses could leave a Liberal minority government. Ontario’s 2018 provincial election will offer an early indication of the strength of Trudeau’s federal opponents.


Significance Voting in the race to replace Tom Mulcair as leader of Canada’s social-democratic NDP begins on September 18, with results announced by October 1. The victor of the contest will go on to contest 2019’s federal election against Prime Minister Justin Trudeau and Conservative leader Andrew Scheer. While not a contender for government, the NDP’s standing and performance at the polls will help determine whether Trudeau’s Liberals are elected to a second term or the Conservatives return to power. Impacts Oil-friendly NDP Alberta Premier Rachel Notley will probably be ousted in 2019 by a new right-wing fusion party. The NDP-Green coalition in British Columbia will pressure the new federal leader for more militant stances on climate and energy policy. Trudeau will probably increase his majority in 2019 should NDP support remain tepid despite a new leader.


Significance There are some concerns about how well-developed PC policy and fiscal plans are. The left-wing New Democratic Party (NDP) is now Ontario’s official opposition and has four years to define itself as a government in waiting. Impacts Carbon pricing and cap-and-trade will be scrapped in Ontario, despite the revenues they bring the provincial government. The NDP’s greater visibility in Ontario will help the federal-level NDP. Within Canada, Ontario faces a disproportionate impact from US steel and aluminium tariffs. Ford and his caucus are likely to rely heavily on tax code changes to shape policy outcomes.


Significance Andrew Scheer’s Conservatives increased their number of seats and won the popular vote, but the non-proportional voting system prevents them winning government. Jagmeet Singh’s New Democratic Party (NDP) performed reasonably but lost seats in Quebec to Bloc Quebecois, this election’s most unambiguous victors. Negotiations are underway to determine with whose support the Liberals will now govern. Impacts Western provinces’ alienation could escalate into demands for separation from Canada or new constitutional arrangements. Quebec will likely demand and gain more rights and autonomy in the federation, but not call for another independence referendum. Scheer will face Conservative leadership challenges but will likely remain party leader. The Trans Mountain pipeline will retain Liberal backing and be constructed.


Significance Some of Canada’s largest provincial governments have seen their approval ratings fall in the wake of the third wave, although there has been little impact on the Liberal government in Ottawa. The political consequences will remain significant in the coming months. Impacts Changes in government could see all provinces except Saskatchewan have a carbon tax in place by 2023. Manitoba could see the election of Wab Kinew as Canada’s first Indigenous provincial premier if current trends continue. Universal pharmacare is off the table for now, as Ottawa and provinces seek to woo back pharmaceutical investment. A return to power of the NDP in Alberta would see several significant mining and oil sands projects cancelled.


Significance The governing Liberal Party presented the election as the most important in decades as it sought a mandate to lead the country’s emergence from the pandemic. Instead, the election delivered little change, leaving Prime Minister Justin Trudeau heading a minority government, most likely with support from the left-leaning New Democratic Party (NDP) as before. Impacts An expected cabinet shuffle will see new ministers at key departments including Justice and Foreign Affairs. Provinces will drop their resistance to the proposed childcare programme, which will be in effect before the end of 2022. No new pipelines will be proposed or built while Trudeau remains in office, given perceived government hostility to fossil fuels. The transfer to the provinces of significant responsibility for healthcare will go ahead as decentralisation accelerates.


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