Former Bank of Canada Governor Lies About Inflation To Attack Pierre Poilievre

Carlton MP and Conservative Party leadership candidate Pierre Poilievre have made the issue of inflation and the management of the Bank of Canada a key focus of critique against the Liberal government ever since Justin Trudeau became Prime Minister in 2015.

During the COVID-19 pandemic, Poilievre has rightfully gone after Canada’s central bank over how much money they have been printing in order to pay for Trudeau’s massive “pandemic relief” spending, especially seen as Canada’s rate of inflation has been pushing past the Bank of Canada’s targets. 

Recently Poilievre called Canada’s central bank “financially illiterate” and in response former Bank of Canada Governor (2001-2008) David Dodge attacked Poilievre, calling his assessment of the central bank “bull****”. 

Dodge explained further, stating:

They understand what’s going on, they made a judgment call, which I think was 100% right and would have been claimed by people like Poilievre to be absolutely crazy in the spring of [2020], but it was that judgment call in the spring of [2020] that saved us from a real depression coming out of the pandemic. 

Dodge never explains that the “judgment call” that the Bank of Canada made in 2020 and 2021 was to print so much cash that over 1 in 5 dollars currently in circulation was printed in the last 2 years. He also conveniently leaves out the fact the economy only took the downturn because of the government keeping the economy locked up in 2020 and 2021 and instead blames COVID itself as well as the recent Russo-Ukrainian war. 

The logic backing up Dodge and the Bank of Canada’s way of thinking is that in an economic crisis the only way to stabilize the economy is by printing more cash and injecting it into the economy to stimulate artificial spending. Although this seems an appealing short-term solution when the economy is in a slump, in reality, this only prolongs the downturn in exchange for a brief uptick in economic activity.

By printing massive amounts of money the government is effectively just lowering the value of middle-class Canadian’s savings while driving up the price of goods, meaning people will be incentivized to buy cheaper products, or fewer products, leading to a chronically slow economy