Greetings friends,
Big news this week includes the Canadian election. Mark Carney will remain Prime Minister as the liberal party retains power, albeit with a minority government. Carney, formerly central bank chair for both Canada and the UK, benefited from the perception of being a political outsider with relevant experience guiding the nation’s economy through times of turmoil. He was also able to distance himself from many of Trudeau’s least popular policies, even quashing some of them during his brief pre-election tenure. Carney also profited most from a surge in Canadian patriotism stirred up by US tariffs and Trump’s comments about becoming the 51st state.
Such has been the upheaval that conservative challenger Poilievre actually lost his own seat in parliament. Both major parties gained seats as support for their smaller rivals cratered, though the Liberal party still lacks a majority and continues to govern with their support. Trade negotiations are set to begin as both Trump and Carney have signaled they will meet in the near future.
Australia also heads to the polls Saturday. There is the potential for a Canada-style backlash against conservatives as their opponents have tried to tie them to their ideological counterparts in the US and capitalize on the resentment of tariffs and general economic uncertainty as the world adapts to a new reality in commerce. Perhaps that was incumbent Prime Minister Albanese’s intent when calling this election early. For clarity, Albanese’s Labour Party is ideologically liberal while challenger Dutton’s Liberal Party is conservative (or more accurately center-right). Many other smaller parties may also be a factor but we will not overburden ourselves with speculation, we shall know the results soon enough.
The UK also went to the polls this week for a number of municipalities as well as a special election for a seat in the House of Commons. Formerly held by a MP for the Labour Party who punched a constituent and was forced to resign. The seat was picked up by Nigel Farage’s Reform Party by a razor thin margin of 12 votes. Reform also performed well in the other races. Farage contends that Reform will be the true opposition to Labour as the Conservative Party continues to collapse, with even it’s leadership believing it will take years to rehabilitate their platform.
The UK’s highest court has also ruled that gender equals sex at birth, at least in regards to legal protections for women such as their “Equality Act.” While there will be challenges, this ruling continues the international trend of legally recognizing that there are immutable biological differences between men and women. What a revelation. Meanwhile in the US, the Department of Health and Human Services has released a report on the treatment of gender dysphoria in children. The 90 day study was a review of all relevant research and information around various treatments and patient outcomes. It concluded there is little evidence more radical treatments such as surgery, puberty blockers, or hormone therapy lead to better mental or physical health.
Outside of this, trade has dominated the news this week. The mineral deal with Ukraine has finally come to fruition. Before we decide whether or not to celebrate having a vested interest in a war zone, we will have to see how this affects the many negotiations taking place to pause the fighting. There is the obvious implication that the US may be more willing to supply Ukraine now that a mechanism for financial compensation exists. Still, there are many red lines in the way of a real peace deal such as Russia retaining its battlefield gains.
The “de minimis” tariff exemption ended today. This applies to packages valued under $800 that are shipped directly to customers in the US. The exemption gave rise to online giants such as Temu and Shein, allowing them to sell directly to the public and avoid the cost of shipping their goods in bulk and paying the associated tariffs like traditional brick and mortar retailers. The sheer volume of these shipments provided cover for illicit deliveries of fentanyl and its components or “precursors.” The exemption had been canceled previously, but flow of goods is such that dealing with the collection of tariffs on those already in route was a practical impossibility. Now, the fees are collected and documented by shipping companies as the goods leave their country of origin.
Trade negotiations between China and the US will likely begin soon. Neither party wishes to appear as having caved. Trump claimed discussions had already begun this week, which China strenuously denied! However, yesterday China quietly announced that we had contacted them to begin talks and, while they were prepared to triumph over their immoral foe and resist to the bitter end, their role as the protector of free trade and a world order based on law compelled them to engage with us and diffuse the situation for the sake of all humanity –– or words to that effect, propaganda has a way of sounding even more ridiculous when translated from a foreign language. The takeaway is that both sides are now talking about talking, so talk they likely shall.
Dad is doing better but still not 100% this week. Your prayers have been appreciated. I hope you all have a great Sabbath.
Michael
