Choices

Diversion 101. When politicians want you to stop looking at something, they find a shiny new thing in the other direction. Get ready.

So Canada’s big engineering firm, SNC Lavalin, is quite the outfit. Fraud and bribery scandals in India. Ditto in Libya. Senior executives charged and on trial. And a massive corruption investigation over its contract to build McGill’s expansive medical centre. With $9 billion in revenues and a billion in profit, this is a Canadian success story. But Lavalin is also our poster firm for corporate sleaze. Or so the oppo guys would have us believe.

Anyway, young T2 seems to have stepped right into this. If it’s true that his office told the nation’s atorney-general to go light on Lavalin and help it escape trial, that’s a big deal. Obstruction of justice. People get locked up.

The AG, also the former justice minister, was dumped in the latest cabinet shuffle and ended up being in charge of veterans affairs – which is the lowest rank. Then she quit. And lawyered up. Mr. Trudeau has cause to worry, if the slighted Jody Wilson-Raybould says she was asked to help Lavalin by thwarting the system. Indications are she was, and refused. Then paid the price.

Will such an egregious error, if proven, be enough to sink the Libs in this year’s election? Is dumping the first-ever indigenous justice minister (a female, no less) damaging the Liberal brand? It’s already being called sexist and racist. Or will a hormonal mass of vaping, texting, Netflixing moisters not care, and vote for the cool guy anyway? Especially if he helps them buy a house?

The government’s brewing disaster may well lead us down that path. We’ve already told you some of what’s being considered for the moister housebuying plan – a return to insured 30-year mortgages, a lifting of the price cap (now $1 million) for CMHC coverage leading to lower downpayments, plus some diddling with the stress test.

With one or two rate hikes between now and the October vote, that test will become even bigger news than now, when industry groups are trying to gut it. The latest jobs stats showed ten times more new positions created in January than were expected, suggesting a robust economy. A new Nanos poll runs counter to prevailing opinion, with a majority of Canadians (55%) saying five rate hikes thus far have been no big deal. And the real estate market is wobbly in most major cities as buyers retreat and realtors have breakdowns.

So, yeah, the stress test is political fodder. It won’t be trashed, but it might be hobbled. The +2% aspect may turn into +1%, for example, which alone would add about 10% to available credit. There’s also some chatter the RRSP Homebuyers’ Plan could be juiced again, allowing a greater amount to be Hoovered from retirement funds for a downpayment, plus an increase to the tax credit designed to offset closing costs.

But whatever’s decided, there’s no doubt the feds will soon try to change the channel away from Lavalin, our war with China, failed pipelines, higher taxes, yellow vests and $100 billion in new debt with a Millennial Houselust Strategy. The question then is what the Cons come up with, plus the odds of regime change on Parliament Hill.

Suddenly they seem higher, given the severity of the Lavalin situation, and the legs that issue might have. Much also rests on the ability of young Andrew Scheer to man up as a campaigner, plus the depth of the Conservative platform. Meanwhile Mad Max is snapping at his heels, trying to suck off the Trump-north, libertarian and anti-immigrant vote. And poor Jagmeet Singh is pooched – arguably the worst Dipper leader in living memory – which means the Libs will not be eroded on their left flank.

Politics, to repeat, is math. Parties form majority governments in this country with just a third of the overall vote, thanks to our weird first-past-the-post system. Meanwhile the biggest voting block in the land is no longer the Boomers, but the Mills. This is the demographic Mr. Socks tapped into so effectively in 2015, appealing to the moister mantra of gender equality, inclusiveness, a sharing economy, more government and lotsa weed.

The kids are now four years older, and face this…

Do you think they’ll vote for less government interference in the judicial system and more ethical leadership, or for dudes saying they’ll make houses cheaper.

Me, too.