Mark Carney's EV fantasies, angering the Americans, Iran can't win...

The big question in Ottawa, why are the Carney Liberals sticking with an EV mandate that won't work.

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In just over six months, the push to ban gas and diesel cars and trucks will start. Canada’s electric vehicle mandate kicks in this coming January with a requirement that 20% of all passenger vehicles sold in Canada be zero-emission vehicles.

In 2024, ZEVs accounted for just 13% of all passenger vehicle sales in Canada and more than 50% of all ZEVs sold last year were sold in Quebec.

But at the start of this year the federal government paused their $5,000 rebate for purchasing an EV and Quebec reduced and then paused their rebate program for two months. Without those rebates, totalling as much at $12,000 per vehicle, sales plummeted.

Sales of EVs were down 28% in April compared to a year earlier, but in February sales were down 41.3% compared to February 2024 and in March they were down 44.9% compared to a year earlier. Total sales of ZEVs in April, which remember saw a slight rebound as Quebec’s revised subsidy program returned, still only accounted for 7.5% of all vehicles sold.

Starting in January, any car maker not meeting the 20% ZEV sales marker can be penalized. Yet, we know that without massive subsidies, most people are not buying ZEVs.

I have nothing against electric vehicles, where they make sense, and when people choose to buy them. This government mandate though is foolish and should be scrapped. The Conservatives presented a motion in the House of Commons calling for it to be scrapped earlier this week and it failed miserably.

On Thursday, they were tying the government’s support for this back to Brookfield, the company Prime Minister Mark Carney was formerly Chair of and that Carney still has significant financial interests in. Brookfield is heavily invested in the EV sector and if it performs well, Carney will continue to be well compensated.

It’s a valid question, but I doubt that is driving this policy, it’s Carney’s green ideology.

Is this just a negotiating tactic???

On Thursday, Finance Minister Francois-Philippe Champagne told reporters that we are sticking with the Digital Services Tax. This is the 3% tax on revenue, not profit, from big American tech giants operating in Canada.

First off, I have all kinds of problems with taxes, or regulatory fees, based on revenues rather than profit. The entire tax though is wrong on so many levels and is opposed by the Democrats and Republicans stateside, it is obviously opposed by the companies who will pay it and by business groups on both sides of the Canada-U.S. border.

“We have the Digital Service Tax in Canada, as you know, it's applicable. This was voted by Parliament, so we're going ahead with the DST,” Champagne said.

That sounds definitive, but then the finance minister pivoted quickly signaling it might be on the table.

“But obviously, you know, all of that is something that we're considering as part of broader discussions that you may have,” he said.

If the DST comes into effect at the end of this month, there will be a $2 billion retroactive payment enforced on American tech giants such as Amazon, Airbnb, Uber, Google, Facebook. If those companies are forced to pay this tax, expect it to derail the trade and security negotiations with the Trump administration.

They will be off, shut down, finished. Forget about a deal within 30 days.

Which is why it is fair to ask, is the government’s stance on the DST now just a negotiating tactic. Some that I have been speaking with say they won’t drop this tax unless they get something in return, which would mean it’s a tactic much like Carney announcing retaliatory tariffs on American steel, but not until next month after the 30 day period and only if negotiations fail.

This could turn out very well for Canada or blow up in our faces, in negotiations, you never know.

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Diplomacy, for now…

People have spent much of the last week, since Donald Trump the G7 in Kananaskis early, speculating about whether he would use American military force in Iran. It’s a deep debate inside his MAGA movement, and American society as a whole, on whether he should.

For now it appears diplomacy has won the day.

European diplomats were pressuring Iran on Friday to commit to giving up their military nuclear program for good to stop the bombing by Israel. We will see if that works, the messaging out of Tehran has been confusing for much of the last week.

I do believe Trump is right, this conflict doesn’t need to end with a ceasefire, it needs to end with Iran’s surrender on nukes. Anything else just puts us back in this same spot sometime in the future.

What to read...

The ongoing war/saga in Iran has the potential to be an incredibly important moment in history, what Mark Carney might refer to as a “hinge moment.” That is one of his favourite phrases and Hinge is the title of his forthcoming book. But as Vivian Bercovici, Canada’s former Ambassador to Israel, writes in National Post, Canada and Carney are irrelevant at this moment. We didn’t used to be irrelevant on the world stage.

My friend Sylvain Charlebois is writing about how the MAHA movement – Make America Healthy Again – is reshaping food policy without government regulation and how that could impact Canada. Withing hours of each other, Kraft Heinz and General Mills announced that they would remove artificial colours and dyes from their food products. This is welcome news that will spill over into Canada.

I’m not a fan of Bill C-5, Lorne Gunter is not a fan of Bill C-5 and none of that is because we don’t want big projects to go ahead, it’s because we worry about government overreach. It’s a valid concern as you look at the criticisms from left, right, and centre. But as Rick Bell writes, some premiers like Alberta’s Danielle Smith and Saskatchewan’s Scott Moe are willing to look past the warts to get things moving. I get it. I don’t like it, but I get it.