Tim Moen, leader of the fast-growing Libertarian Party of Canada, took time off during the Holidays to provide insights into key issues facing the Canadian economy in 2017. One priority: partially divesting US dollar holdings and shoring up Canada’s gold reserves.
Canada’s economy contracted by 0.3% (in October). The unemployment rate came in at 6.8% (in November), two percentage points above the US total. The deficit has skyrocketed. How do you assess the Liberal government’s economic performance?
It’s hard to imagine a worse set of policy proposals.
People who voted for Justin Trudeau are feeling gratification from the short-term spending his government has been implementing. They haven’t yet felt the pain. Projected deficits have tripled from what the Liberals promised during the election and the buying power of the Canadian dollar is down.
Deficits are the wrong thing to do in an economic downturn. When my family hits tough times, we tighten our belts and cut spending.
When you believe (as most left-wing economists seem to) that wealth is created when government taxes and borrows and directs money to the right areas, then you might think they are on the right track. But any serious economist knows that the market is the most efficient way to distribute money because it does not tolerate foolishness and incompetence.
Other jurisdictions have discovered that for every job created by government spending another two to four are lost. Nobody considers the unseen costs of these policies.
What are your views on a future Trump Administration?
Trump (through his borrow, spend and simplistic anti-trade policies) is offering a hit of heroin to Americans, who in many ways have become a country of heroin junkies when it comes to public policy. They are lapping it up. Trump’s election matters in that he had an anti-establishment message. He hit on a note in an American culture that is sick of the status quo.
But I remain guarded that this means we are going to see any meaningful change. I don’t get that sense at all.
Trump is not pursuing Hillary Clinton like he said he would, and shows no signs of “draining the swamp,” judging from the number of Goldman Sachs executives and other insiders being nominated to key posts.
For meaningful change to happen, we need a population that demands liberty, more than the illusion of security, and that is willing to make uncomfortable adjustments and sacrifices right now in their own personal lives in exchange for long-term gains.
Many in the “Alt Right” community, a key segment of Trump’s supporters, are coming out in favour of protectionist, anti-trade measures, such as tariffs and increased restrictions on labour mobility. What is your position?
They are wrong. If obstacles to trade between countries made us richer, why not have walls between states and even cities? As the Smoot-Hawley tariffs showed , trade barriers make everyone poorer.
Having an Austrian or Chicago economic school lens to view the economy has never been more important.
Protectionism may save some jobs in the near term but it does so at the expense of everyone else. Many politicians simply don’t understand these basic laws of economics. I blame public education and decades of leftist economic indoctrination.
The Bank of Canada is now in its ninth year of keeping its policy rate below 1%. Investors are taking note. Both gold and bitcoin outperformed the Canadian dollar last year. Is it time to allow more use of alternate currencies?
Yes. Unfortunately the very thing that makes these currencies valuable also makes them a threat to central planners. So it is more likely that we’ll see them regulated.
I’m especially concerned with an increasingly invasive state in our online lives. Bills C-51, C-13, C-31 and the TPP are examples of how our internet freedom is being eroded and making it easier for authorities to interfere with exchanging crypto-currencies.
Canada’s foreign reserves are now all in paper currencies, mostly US dollars, following the Trudeau administration’s decision to sell off Canada’s remaining gold reserves. Is this a good idea?
We have tied ourselves to a sinking (US dollar) Titanic. The trillions of dollars in American unfunded liabilities and seemingly unchecked creation of money there is a recipe for disaster. I prefer having money tied to a physical hard cap to prevent inflation of the money supply.
While Canada should keep some US dollars and other paper reserves for trading purposes, holding the bulk of our foreign currency in gold would better preserve our purchasing power.
Canada’s FOREX reserves as per the BOC
The advent of Maxime Bernier has given Canadian libertarians a choice. Should they support Bernier’s run for the Conservative Party leadership? Or stick with the Libertarian Party and risk remaining a marginal influence?
I like Bernier. I’ve spent time with him and I consider him a libertarian. I wouldn’t blame anyone for supporting him. If I thought that the Conservative Party of Canada would be a force for shifting culture to liberty I’d join them.
That said, my metric of success is a shift in culture and to that end I see mainstream parties as doing the opposite of shifting culture, they are reflecting it and entrenching it…that’s how elections are won.
Put another way I’m less interested in a libertarian leading a socialist system and more interested in a libertarian system that can withstand even a socialist leader. The “leader” of a government is actually a follower of the system, they are constrained and made servants of a political market demand.
Tell me about how the year has shaped up for yourself and the Libertarian Party of Canada?
We are coming off a successful convention in Calgary this summer. That included putting a series of Regional Directors and infrastructure in place across the country for the first time, to recruit new people, particularly potential candidates into the party. We also set up a series of policy committees that will review key issues , and provide recommendations that will be included in our political platform in the next election.
One unmistakable sign of our growing influence is that politicians from other parties (notably Conservative Party leadership candidate Maxime Bernier) are plagiarizing our platform. The fact that others are adopting libertarian ideas provides tangible evidence that our message is getting out.
You mentioned that you have four kids. Has this affected your political outlook?
Absolutely. Having kids forces you to think about the long term. Decisions we are making now will have a huge impact on their lives and those of our grandkids.
Things are a lot tougher for their generation. During my days you went to college, got a job and you were set. They don’t have it that easy. Our kids need to be more comfortable with discomfort. I tell them that “safe spaces” are where you go to atrophy and die.
Moen and daughter Sarah at the firing range.
That philosophy extends to my personal life. For example while I am not an active firearms enthusiast, I think it is important that my kids get out to the range, to understand firearms … that they are serious business. Getting them out of their comfort zone gives them a “growth mindset.”
Tell me about the Libertarian Party’s plans for 2017? I notice for example that the Party has plans to participate in the “Students for Liberty” conference?
SFL is an important event, because of the opportunity it provides attendees to establish working connections with liberty advocates from across North America.
For example, Canadian libertarians need to study Gary Johnson’s performance in the recent US election. Judging from the criticisms and expectations you’d think he failed. Yet Johnston had a historic vote count, more than Ron Paul got when he was a libertarian candidate. In short, US Libertarian Party chairman Nick Sarwark is doing a fantastic job and I’ll be having my team connect with him soon to see what lessons they learned.
Article by Peter Diekmeyer, Sprott Money