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“Justinflation” — a major rallying call of the Pierre Poilievre-led Conservative Party — may be disappearing from Tory literature in the wake of new figures showing that Canadian inflation isn’t doing all that bad anymore.
The latest figures from Statistics Canada show that inflation dropped to 3.4 per cent in May, which is not far off from the two per cent annual target that the Bank of Canada typically shoots for. And things are really looking up in Atlantic Canada, where inflation has basically returned to normal, with rates in Nova Scotia, New Brunswick and Newfoundland and Labrador all hovering around two per cent.
Liberal cabinet ministers were quick to take credit for the new figures, with Transport Minister Omar Alghabra declaring in a tweet “contrary to what the Conservative Party has been claiming, our plan is fighting inflation and supporting Canadians during this challenging period.”
But the drop was due largely to a sudden 18.3 per cent drop in gasoline prices, which helped to conceal a continued trend of higher-than-average price surges basically everywhere else. Grocery inflation, most notably, remained at nine per cent in May – with that rate rising as high as 20 per cent for products like margarine or olive oil.
Still, it’s a vast improvement from this time last year, when inflation rates were peaking at a 39-year high of 8.1 per cent.
Virtually the entire developed world was walloped by an inflationary spiral in the period immediately following the lifting of COVID-19 lockdowns.
In all this, Canada actually did better than the average. When Canadian inflation rates hit their worst last summer, they were still lower than the average for the OECD, the G20 and the European Union. During that period, the United States and the U.K. would consistently post inflation rates that were several points higher than Canada’s.
On inflation, Canada is still coming out on top as compared to most of its peer countries. Canada’s latest 3.4 per cent figure is far lower than the current OECD inflationary average of 7.4 per cent.
As to why this is happening, one key contributor is that many of the world’s baseline commodities are legitimately more expensive now than they were just a few years ago.
Global supply chains have hardened since the mass border closures of the COVID-19 pandemic, meaning that many goods are now being shipped via means that are trading off cost for reliability. The war in Ukraine also deleted vast quantities of grain and oil from the global economy, prompting a bidding war on whatever was left.
This is not to say that the Trudeau government is blameless in the circumstances that caused inflation to hit generational highs. For one thing, the feds have continued to run enormous deficits, pouring billions of dollars of extra spending into an economy already top-heavy with cash.
One of the more egregious examples was programs explicitly designed to relieve inflation via 10-figure packages of direct cash handouts — a tactic that likely had the effect of bidding up prices even further. Although, to the Trudeau government’s credit, conservative provincial governments in Alberta, Saskatchewan and Ontario all did the exact same thing.
The first recorded mention of the word “Justinflation” was by Poilievre in November 2021, back when he was shadow minister of finance under then-Conservative leader Erin O’Toole.
Inflation at the time was around 4.4 per cent, but Poilievre was using the term in reference to rising housing costs.
“Last year, home inflation hit over 25 per cent, which the real estate association’s chief economist called the ‘biggest gain of all time’… that is Justinflation,” he said during the Finance Committee’s questioning of Statistics Canada’s chief economist Anil Arora.
Once Poilievre became Conservative leader in September 2022, official usages of the word among the Tory caucus suddenly surged, with 14 Tories managing to find a way to slip it into an official Parliament statement.
Although mentions tailed off after the Liberals led an effort to get the word banned as an example of unparliamentary language. It already technically was, since MPs are forbidden from using each other’s first names.
Poilievre would last use the word in the House of Commons during a Feb 1 Question Period, when he blamed high Liberal deficits for causing inflation to spike to 40-year highs. “It is ‘justinflation’, and Canadians are paying the bill,” he said.
His last usage of the word on social media was last month, where it appeared to have been employed in its original use as a catch-all term for the rising cost of living, rather than something specifically referencing the Consumer Price Index.
In response to a new clean fuel standard that would add to Canadian gasoline and diesel costs, Poilievre tweeted that it “will make gas, heat and groceries even more expensive while JustinFlation rockets.”
IN OTHER NEWS
Why do Canadians pay some of the highest cell phone bills on earth? Lack of competition. Why are Canada’s airline tickets way more expensive than the global average? Lack of competition. And according to a new report by the aptly named Competition Bureau, lack of competition may also underlie Canada’s high grocery prices. Most Canadians buy their calories from one of three places: Loblaws, Sobeys, or Metro. “In recent years, industry concentration has increased, and it has become more difficult than ever for businesses to enter, expand, and compete effectively,” writes the bureau. Rising prices “are not always indicative of a competition problem,” reads the report, but the fact that profit margins for grocers are steadily rising is a sign “that there is room for more competition.”
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