The Key Economic Issue to Watch in Canada's Upcoming Federal Election | Financial Buzz

The Key Economic Issue to Watch in Canada’s Upcoming Federal Election

On October 21, 2019 Canadians will head to the ballot box and decide which party — the Liberals, the Progressive Conservatives, or the New Democrats — will reign for the next four years; that is, of course, unless voters elect a minority government, in which case there could be an election before 2023 (note: the environmentally-focused Green Party in Canada is gaining traction and has sent a couple of politicians to Parliament, but nobody expects them to form government; although they could potentially play a role in shifting the balance of power, which would certainly make things interesting).

Naturally, Canadians will cast their vote based on a mix of issues, including many that are readily familiar to their cousins to the south who will head to the polls next year, such as immigration, climate change, foreign policy, and so on. However, many political pundits believe — and frankly, as far as predictions go this doesn’t qualify as going out on much of a ledge — that the most pressing issues and concerns will be rooted in the economy.

The good news is that Canada has a fairly robust economy. In fact, in August the country added about 81,000 new jobs in a variety of fields such as education and professional services (e.g. dental office design), and unemployment is hovering at around 5.7 percent. There is also some cautious optimism that worst of the popped housing market bubble in cities like Vancouver is in the past.

However, the bad news is that it wouldn’t take much for Canada’s relatively rosy economic outlook to become bleak — and terrifying. As such, even though they may have steady paychecks and the price of milk, bread and Netflix (a survival staple in a country that is traditionally known for flannel, maple syrup and hockey, but is surprisingly advanced and progressive when it comes technology-led products and services), Canadians will be voting with their head, their heart and, indeed, their wallet.

With this in mind, there is one especially vital economic issue to watch as the election campaign unfolds (and more hands get shaken and babies get kissed), and the next version of the Canadian government mobilizes: pipelines.

The clash between pro-pipeline forces and anti-pipeline forces has been going on for several years. The situation became so intractable, that the current Liberal government shelled out billions of dollars to buy the rights to build a pipeline from the oil-rich province of Alberta, westward to the neighboring province of British Columbia; ultimately so that oil could be exported across the Pacific to Asia and elsewhere, instead of being routed southward through the U.S.

If the pipelines are built, Canada would be flush with an unprecedented boon of petro-dollars, and create millions of direct and indirect jobs. However, the environmental impact would be severe (and some say, catastrophic), and relations between the government and indigenous tribes — which has never been especially good — could reach an all-time low unless some major concessions and deals are made (which in turn would raise the ire non-indigenous residents, who comprise the bulk of the population and, indeed, the electorate).

If the left-leaning New Democratic Party gains power — which is unlikely, but anything is possible — expect to see the pipeline stall. If the right-leaning Progressive Conservative party gains power, expect to see an aggressive push to get the pipelines built (which will undoubtedly be met with a slew of legal challenges). And if the center-left Liberal party returns to power on the evening of October 21, then it’s unclear how fast they’ll move — or the courts will allow them to move — to build the pipeline. They promise it will get done, but how quickly and at what cost is up in the air.

Suffice it to say, things over the next few months are going to get pretty heated and tense in normally polite, reasonable, stable and compliant Canada. But then again, anyone who has witnessed a good old fashioned hockey fight knows that while it takes a lot to raise the ire of Canadians, once they get roused up and the gloves come off, it’s a whole different story.