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Graphic Truth: Iran has a rial big problem
Iran’s Supreme Leader faces a number of challenges in the wake of the devastating 12-day war with Israel, and the perennial weakness of Iran’s economy is chief among them. Economic mismanagement, corruption, and strict Western sanctions have sapped output, weakened the currency and contributed to high inflation for years. But the recent spike in tensions with the US and Israel has accelerated the collapse of the Iranian rial, which has halved in value against the dollar since the end of last year. Here is a look at how the Iranian Rial has performed against the greenback since 2022.
Canadian Prime Minister Justin Trudeau speaks after signing an infrastructure agreement in Montreal, December 16, 2016.
Trudeau’s Darkest Hour
This is Justin Trudeau’s darkest hour.
Even as he shuffles his Cabinet tomorrow, it will not shuffle his political future. This is the endgame.
Eventually, all successful politicians turn into Dorian Gray — gazing into the mirror and seeing a reflection of beauty they believe voters will find irresistible. All the while, however, somewhere under a parliamentary staircase, a portrait of their political face is being ravaged by time, scandal, and betrayal. That is the bargain leaders inevitably make as they fight to stay in power.
There was President Joe Biden earlier in the year, still seeing the reflection of a robust man ready to govern for another four years despite the fact that he couldn’t get through 40 minutes of a presidential debate. He had to be pried out of the presidential limo by the Jaws of Pelosi.
In 2015, former Conservative Prime Minister Stephen Harper thought he too saw another big election win in the mirror, but instead, insulated from reality inside his powerful prime minister’s office, he suffered a stunning defeat. The wheel of change is not partisan, but it is powerful.
Trudeau is now seeing the real portrait for the first time. After nine years in power, down 20 points in the polls, he has long refused to look, but his once trusted Finance Minister Chrystia Freeland just swiped the picture from under the stairs, waved it around publicly, and then lit it on fire.
It’s hard to imagine a more shambolic ending. Freeland was told by the PM — on a Zoom call, no less! —that she was going to be replaced as finance minister right after she presented the Fall Economic Statement (a kind of mini-budget in Canada) that would reveal the government blew past its own key deficit target by more than CA$20 billion. In other words, “Please wear this fiscal mess and let me move on to a new thing.”
How was that ever going to work? Naturally Freeland refused, but she didn’t simply quiet-quit and go gently into that good political night. Instead, just hours before she was set to deliver the FES, she chaos-quit with a controlled rage, rage-against-the-dying-of-light letter, dismissing Trudeau’s entire economic agenda as a self-serving “political gimmick.”
It blew the government apart.
It’s hard to declare winners and losers in this carnage, as everyone in the government is a casualty. The PM is now facing an open revolt by a growing number of MPs. Wayne Long, an outspoken Liberal, went on CTV’s ‘Power Play’ to say Trudeau is “delusional” and claimed that up to 40 MPS want him to resign, though that number has yet to be confirmed. Still, his sentiments were reflected in comments MPs told me, one saying bluntly, “I hope he announces he is stepping down.”
Freeland herself says she is running again, which basically kicked off the next leadership race, and she is likely the front-runner. But, as the saying goes, “The hand that wields the knife shall never wear the crown.” Freeland delivered four budgets for Trudeau, and even if she rightly fought back against the $1.6 billion goods and services tax holiday boondoggle, that hardly adds up to the over $20 billion overage on her own targets. If Canada is facing a fiscal reckoning and an angry electorate, isn’t Freeland as responsible as Trudeau? Would Canadians be able to disaggregate the two?
All this could not come at a worse time for Canada, now under direct threat from President-elect Donald Trump. He promises devastating 25% tariffs on Canada the day after he is inaugurated, and, with a hyena’s nose for weakness, he has persistently and publicly tormented Trudeau with the threat of making Canada the 51st state.
Pause on that for a second because it is unprecedented in Canadian-US history, unless you want to go back to … 1812, before Confederation. What started out as a Trump taunt is starting to look more like a Trump trial balloon. Trump’s son Eric has amplified the idea on social media, and now, on places like Fox News, taking over Canada is a topic of genuine debate.
With Trump, the first question is always: Do we take him literally, or seriously, or both?
And the lesson people have learned in the last eight years is: both.
Even as government officials have dismissed the threat as a joke, others are taking it seriously. Ontario Premier Doug Ford is showing up on American news programs defending Canada and threatening to cut off energy exports.
Trump trades in three currencies: power, fame, and loyalty. A lame duck leader of a foreign country who has only one of these three may come to Mar-a-Lago for dinner, but he might well end up on the menu.
The best hope Canada has is for the 35 state governors who depend on Canada as their top trading partner to act as de facto proxies for Canada, and push back against tariffs that will hurt their workers and economies.
Now what?
A few paths:
One, Trudeau stays and runs again after tomorrow’s Cabinet shuffle. There are no polls or signs that would suggest this is the most productive path, but, until he leaves, it has to be an option.
Two, Trudeau leaves, prorogues parliament, and the leadership race kicks off. The rules around that election will be crucial for the Liberal Party.
Can Liberals afford to take three months to elect a leader while Trump launches trade tariffs and the Conservatives consolidate their lead in the polls? It is not advisable.
On the other hand, can they afford to do a short 30-35-day process, in which case very few Canadian voters and new candidates will get involved? That might not end up injecting any fresh blood into the party at all. The Democrats tried it in the US and ended up with a frothy Kamala Harris campaign start and a miserable end.
There are few good options for the leader and the party right now, but if the government falls on a confidence motion in the new year, then the race is one with Trudeau at the helm, which is exactly what the opposition parties want most of all.
Nothing can happen until the prime minister decides what he will do.
It’s coming on Christmas, as Joni Mitchell once sang, the day the prime minister was born, but instead of seeing a star in the sky, even he knows this is his darkest political hour. The only guide he has might be those portraits of other prime ministers that hang in the halls of Parliament, each of whom has had to ask the same impossibly hard question: When is my time up?
Only a few of them got to choose their own answer.