What a difference a week makes. The mid-term election results are about to reset not just the United States, but Canada as well. It will soon be 2024 again – a good thing for the world at large but not necessarily for Prime Minister Mark Carney’s government, which delivered a problematic budget on Thursday just two days after the U.S. elections.
Before we get to the budget, let’s talk about those mid-terms – a drubbing of President Donald Trump if there ever was one. In taking back control of both the House and Senate, the Democrats have relegated Trump to lame-duck status for the remainder of his term. At best, he and the members of his administration will spend the next two years battling to keep their jobs (Defense Secretary Pete Hegseth is already on the bubble). At worst, their most damaging efforts will be reined in.
Some of the Canadian commentariat suggest that Trump still has significant powers and may lash out, because he is obviously prone to doing so, and he could get even more hostile to Canada in his remaining time. But with his power base gone and Republicans turning on him in real time, that’s as unlikely as the president taking up late-in-life vayganism… er… veganism.
It also misses the point of the Democrat win – affordability. Post-election commentary in the U.S. is uniform in assessing that Republicans were trounced because of their support for policies that have exacerbated a cost-of-living crisis that was already festering before Trump took office.
That means tariffs that have driven up the cost of goods and imperilled jobs, the Iran war that has jacked up the price of gas, and the rhetoric that has kept Canadians away from visiting and buying American products. These policies, which never made sense, have harmed Republican and Democrat states alike. Mid-term voters showed both it’s time to reverse course on all of them, post-haste.
Make no mistake – it’s all done now. Trump is done. Commentary that suggests otherwise only serves to reinforce the governing mandate that Carney and the Liberals – let’s face it – lucked into two years ago.
If we can take our time machine back to 2024, let’s remember that Canadians had grown excruciatingly tired of Justin Trudeau and the Liberals’ inability to tame the affordability and housing crises. Pierre Poillievre and the Conservatives were set to cruise to power.
But then Trump happened and in swooped Carney, the well-mannered and well-manicured banker whose demeanour oozes adult-in-the-room. As the literal antithesis to the U.S. president, Carney led the Liberals to perhaps the most astounding comeback in Canadian political history.
Since then, the Prime Minister has engaged in so-called nation-building projects domestically while diversifying and building trade coalitions abroad, all while continually invoking the need to do so because of the bogeyman down south.
None of that is wrong. These are smart things to do even in the best of times. But the underlying imminent threat rationalizing it all – the bogeyman – is no longer there. Neither is the cover, which means Canadians are going to rightfully start questioning their government’s moves and motives a little more.
On that front I’m reminded of Carney’s answer to a reporter’s question at the Investment Summit in September about why he’s moving to privatize airports. His predecessor studied the issue in depth but backed off because of how unpopular it was with the public. When asked why things are different now, Carney invoked Trump and a “more dangerous world.”
But what happens when the world becomes considerably less dangerous, as it has now that Trump has been neutered? That already paper-thin rationale disintegrates, leaving only the uncomfortable truth – the only reason airports are being privatized is because the pension funds desire them.
Improving Affordability and Record Food Bank Usage Do Not Compute
Here in 2026, daily life is not more affordable for Canadians in any meaningful way than it was in 2024, despite what this week’s budget claims – and yes, it’s time we got to that.
According to the budget, incomes are rising and affordability is improving. Real disposable income per capita has increased 6.4 per since 2019 and nominal disposable income rose 8.3 per cent in the second quarter, which means that household incomes are 4.2 per cent higher than a year ago. Grocery inflation “slowed” to 1.7 per cent in September while “housing finances remain generally sound.”
But then there’s the bad news. Add inflation to those numbers and household incomes are only 1 per cent higher than a year ago. That’s not much of a win, especially against a backdrop of record food bank usage and Canada routinely leading the G7 in food inflation. Never mind the continuing high prices in virtually every other market, which as we know by now, is the product of a lack of competition and oligopolization.
The budget acknowledges some of the structural problems plaguing these sectors with promises to cut burdensome regulations and a repetition of the Productivity Mega Deduction announced at the Summit, which is likely to spur companies to investment in capital and technology. The upside to that, in real terms, is your employer may finally upgrade that 15-year-old computer you’ve been suffering with.
It also expands on the whole-of-government competition plan that was first mentioned in the spring economic update by promising to “embed competition considerations across federal regulation and policing making.” But as competition advocates point out, much of the plan so far is to cut red tape, a far cry from a similar strategy adopted by President Joe Biden during his term.
“Something that’s missing from the whole-of-government competition plan is a mechanism to make sure departments are accountable, like the annual meeting with [department] heads the Biden admin had,” says Keldon Bester, executive director of the Canadian Anti-Monopoly Project.
“It seems like they’re floating another test for any new regulation focused on competition, but that isn’t going to do much for the monopolies we already have. This is a broader problem with the red-tape mindset – these monopolies aren’t just made of regulations.”
Not surprisingly, federal NDP leader Avi Lewis is sharply critical of the budget. It’s his job to be, but he also seems to have a better read of the room than the government does, especially in light of what just happened down south. As he posted on X:
“Today’s budget is Christmas come early for CEOs, foreign investors and arms dealers. It talks a lot about affordability but does little to actually lower your costs. The single biggest item in the budget is a ‘mega deduction’ for corporations, with a price tag of $36 billion over five years. Fifty per cent more than all of the ‘affordability measures’ combined. But where is the mega deduction to your grocery bill, or your rent? The ‘Masters of our Destiny’ in Budget 2026 is not you and your family, it’s members of the billionaire class that the Prime Minister invited to his Investment Summit.
Whether you consider that simple opposition showboating or even boilerplate social democrat rhetoric, the fact is that Lewis has some unlikely bedfellows in his take on the budget. The Canadian Federation of Independent Businesses, which represents more than 100,000 small and medium enterprises, is also angry about the government bending over backwards for the big dogs while providing little for everyone else.
“While there is a re-announced Mega Deduction and a focus on mega projects, small business owners will find the 2026 budget mega disappointing,” says CFIB president Dan Kelly on X. “If you are a small business owner struggling to keep your business going in the face of rapidly rising costs and a trade war, the budget will provide you with no help whatsoever.”
David Macdonald, a senior economist at the Canadian Centre for Policy Alternatives, tells it to the Toronto Star bluntly: “This is a budget for big business… It is masquerading as a budget for pocketbook issues.”
Contrast these takes with what anti-monopolists are saying down south. Over on his Substack, American Economic Liberties research director Matt Stoller says the mid-term results clearly signal an anti-oligarch agenda is coming to Congress. Numerous winning candidates included antitrust reform, busting monopolies and fighting consolidation in sectors including groceries and utilities as parts of their platforms.
“The point overall is that anti-monopoly showed up in a way that it really hasn’t in a long time. And a lot is owed to Bernie Sanders and his Fight Oligarchy tour, which for the past two years has platformed candidates across the country, building the connective tissue between populist rhetoric, actual governance, and mass politics,” he writes.
“My back-of-napkin calculation shows Sanders’ endorsed candidates, well over 50, won over 90 per cent of their races, and about a dozen of them flipped their seats.”
Justin Stofferahn, the anti-monopoly director at the Minnesota Farmers Union, believes the results echo those of more than a century ago, when presidential candidates Woodrow Wilson and Teddy Roosevelt tried to one up each other on how to address the Gilded Age’s octopus-like trusts.
“This election could serve as the beginning of a wave of reform akin to that which followed the 1912 election,” he writes on his Substack. “If it does not, voters will likely be swinging back in 2028.”
The same holds true in Canada, where the bogeyman is gone and it’s time to get back to fixing the real problems. Otherwise, a similar wave just may come for Parliament Hill.
🎧 ON THE PODCAST THIS WEEK:
Keeping Canadian Companies Out of Corporate Giants’ Hands
The U.S. mid-terms are in sharp focus this week as the world awaits the outcome of what is, no exaggeration, one of the most important elections in the country’s history. What happens this week could determine the course that not just the U.S. takes, but the rest of the world.
🚨 COMING UP
Legendary Globe and Mail personal finance columnist ROB CARRICK joins the Do Not Pass Go podcast this Tuesday to dissect the budget and Mark Carney’s bona fides in banking competition. Plus, he shares his tips on how to avoid getting taken advantage of by the bank oligopoly and we discuss why Canadians are so gosh darn conservative (with a small “c”).
I agree that Carney is going to have show he can do more for struggling families and small businesses, but I don’t agree that the spectre of Trump is gone. The man himself may not be the malevolent force he once was, but until Congress rescinds all of his harmful tariffs-- which by all accounts is very low on their to do list-- Trump’s impact on Canada remains. As long as that’s true, Carney will have a lot of latitude to make the big moves needed to insulate us from these threats now and in the future.
The truth is, 2024 is now another universe, permanently inaccessible. To think otherwise is to slip back into the same complacency that left us unprepared for all that came after.
I’m content to let Carney map the way forward as long as it demonstrates the potential for Canada to establish a new anti-fragile stance, away from the unreliable partner south of the border.
Very well written and clearly thought through. BUT I think the situation is slightly different. As Ian Lee and I discuss in our book, Trapped in the Shadow of Trump's America and How We Escape (www.trapped.net), Canada must resolve its structural issues, or affordability as a mission is a fool's errand. We think Canadians are smart enough to understand once they see the facts. Canada spent 60 years building our own economic straitjacket using regulations, interprovincial trade barriers, and a refusal to release the wealth under our feet. Changing that structure will take political will, and it requires voters to understand, too.