Juno News - Justinflation is wreaking havoc, so why is everyone ignoring it？

00:00:00.320 Canada is facing an unprecedented economic situation.

00:00:03.600 There is a severe labor shortage, the global supply chain crisis is limiting the number

00:00:08.380 of goods available and sold in Canada, and finally, most of all, inflation is driving

00:00:13.760 up the cost of almost everything.

00:00:15.440 We'll talk to one member of parliament today who is doing everything he can to ring the

00:00:19.280 alarm bell and talk about what he calls just inflation.

00:00:22.760 I'm Candice Malcolm and this is The Candice Malcolm Show.

00:00:24.760 Hi everyone, thank you so much for tuning in today, we've got a great show for you today,

00:00:33.140 but first I'm going to stop you right now and say if you're watching the show on YouTube

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00:01:06.520 It really helps us out.

00:01:07.520 Okay, we're going to get right to the interview today.

00:01:09.400 I'm really pleased to be joined by one of the most effective communicators in parliament.

00:01:13.740 I'm talking about MP Pierre Polyev.

00:01:16.000 Polyev is the Conservative Member of Parliament for the Ottawa-based riding of Carleton where

00:01:21.100 he's been the MP since 2004, Pierre currently serves as the Conservative Party's finance

00:01:26.140 critic and has kept the Trudeau government accountable for the unprecedented number of

00:01:30.980 new spending initiatives during the pandemic.

00:01:34.060 Since the government began printing more and more money, Pierre has been one of the only

00:01:37.600 MPs in Canada who has consistently sounded the alarm bell, but not just sounded the alarm

00:01:41.920 bell.

00:01:42.920 He's done an incredible job articulating what the problem is, helping Canadians understand

00:01:46.900 because we're talking about abstract financial concepts here.

00:01:49.940 It is hard to wrap your head around it sometimes.

00:01:52.940 And Pierre does a great job of making it more easily understandable and more approachable for

00:01:58.780 the everyday Canadian who might not have a background in finance.

00:02:02.420 He cuts through the spin.

00:02:03.420 He calls out the media.

00:02:04.260 He does exactly what you want a Conservative MP to do.

00:02:06.940 And his work on inflation has been absolutely outstanding.

00:02:09.880 So Pierre, thank you so much for joining The Candice Malcolm Show.

00:02:11.900 It's always great to have you on the show and we really appreciate all that you do.

00:02:15.540 Thanks for joining the program.

00:02:17.220 It's great to be with you, Candice.

00:02:19.460 So let's talk about inflation or as you call it, just inflation.

00:02:22.760 So the government believes that this isn't a made in Canada problem.

00:02:26.660 Chrystia Freeland said this, they think that it's part of a global problem and the best

00:02:30.480 way to address these concerns is through things like childcare subsidies, housing subsidies.

00:02:35.560 So I want to ask you, Pierre, what is wrong with this approach and will the government

00:02:39.620 ever stop spending our money?

00:02:42.380 Well, let me start with the diagnosis and then we'll talk about the cure.

00:02:49.760 The Liberals want you to believe that this is just some problem that came from elsewhere

00:02:54.320 around the world and that they're doing their best to solve it.

00:02:57.260 But let's analyze that and break it down.

00:03:02.940 They say that, for example, COVID caused supply chain disruptions, which has raised prices.

00:03:09.080 Well, if that were true, then you would expect products that don't have supply chains to

00:03:14.540 have no inflation.

00:03:16.340 The most obvious example is raw land.

00:03:19.220 Raw land has no supply chain.

00:03:21.220 It's under our feet.

00:03:22.220 It's been here for thousands, maybe millions of years.

00:03:25.380 So if inflation were just the result of blockages at shipping ports long thousands of miles away,

00:03:33.220 you wouldn't expect any inflation for something like land.

00:03:36.280 Well, it turns out land prices have inflated by 20% in just one year, in other words, four

00:03:42.800 times faster than the average inflation rate as measured by Stats Canada's CPI index.

00:03:51.420 So we know that there is something homegrown when land prices increase that fast.

00:03:59.340 And we also know that housing price inflation is an extraordinarily Canadian phenomenon.

00:04:06.700 We have the second biggest housing bubble in the world, according to Bloomberg.

00:04:11.660 Only New Zealand, which has the restriction of being a tiny island with a finite amount of

00:04:18.860 land, has higher housing prices than Canada relative to income.

00:04:24.340 Vancouver is now the second most unaffordable housing market in the world.

00:04:30.860 And Toronto is fifth.

00:04:32.560 So those two cities are now ahead of San Francisco, Chicago, Manhattan, London, England, all kinds

00:04:39.260 of places with less land, more people and more money.

00:04:41.860 So that can only be a homegrown inflation phenomenon, homegrown being an intended pun.

00:04:50.640 And so but the government is right about one thing.

00:04:54.280 There is inflation in other countries, in those countries that have the same inflationist policies

00:05:01.220 that our government has.

00:05:02.800 So where they're printing money and running monster deficits, they're getting high levels

00:05:08.240 of inflation.

00:05:08.840 It is true that you can you have this phenomenon everywhere in the world.

00:05:13.560 It's tried, not just in Canada.

00:05:15.160 So if you chart the G20 countries and you put money supply on the x-axis and inflation on

00:05:25.640 the y-axis, you find a nearly perfect correlation.

00:05:30.400 Those countries that have had large money supply growth over the last year and a half have the

00:05:36.100 highest inflation and those with low money supply growth have the lowest inflation.

00:05:41.380 So it is the decision of countries to print money.

00:05:44.820 Now, liberals will say, we had no choice.

00:05:47.000 We had to print money and run huge deficits.

00:05:48.960 Well, we had to spend some money during the pandemic, but we didn't have to have the biggest

00:05:52.780 deficit in the G20.

00:05:54.500 And we also didn't have to print money to pay for those deficits.

00:05:57.820 We know this because countries who did not print money are succeeding now.

00:06:02.640 For example, Switzerland has 1.2% inflation.

00:06:07.600 Japan has 0.2% inflation.

00:06:11.300 Why?

00:06:11.640 Because they did not print excessive money to fund their governments.

00:06:15.580 So that's how we diagnose the problem.

00:06:18.960 They're printing money to pay their bills, which inflates the price of everything.

00:06:23.260 Too many dollars chasing too few goods.

00:06:24.960 So the second part of your question is, should they spend more money still to tackle inflation?

00:06:30.640 Well, that would be like trying to cure lung cancer by smoking more cigarettes or to cure

00:06:36.000 obesity by wolfing down more cheeseburgers.

00:06:39.400 You'd be taking the cause as the cure.

00:06:43.900 Instead, we need to do the exact opposite.

00:06:46.780 Balance our budget.

00:06:48.020 Stop printing money.

00:06:49.220 Instead of creating more cash, create more of the stuff cash buys.

00:06:52.480 Build more homes, grow more food, deliver more clean Canadian energy to consumers.

00:06:57.480 Well, it seems laughable that the solution that the Liberals have come up with is continuing

00:07:03.660 on the path of spending more, borrowing more, and printing more.

00:07:07.280 Pierre, let's talk a little bit about the theory behind it.

00:07:10.480 Because I don't think that people really recognize that this is a concerted effort.

00:07:14.940 It's a planned decision, something called the modern monetary theory, which has been embraced

00:07:20.940 by left-wing liberal governments like Justin Trudeau, like Joe Biden down in the States and

00:07:26.620 other governments around the world that you talked about have this corresponding increase

00:07:30.720 in inflation.

00:07:31.580 So can you walk us through a little bit what the thinking is?

00:07:35.040 And as a secondary question to that, I mean, they know what they're doing and they can recognize

00:07:39.760 it.

00:07:39.880 They can read the statistics just as well as you can and I can.

00:07:42.940 So why is it that they are sort of turning against the obvious answer as to why inflation

00:07:48.860 is happening?

00:07:49.340 Obviously, it's because of printing money.

00:07:51.100 Why is it that Liberals, I mean, they're smart people on the Liberal side of the aisle

00:07:54.860 there.

00:07:55.260 They must understand, be able to read charts and see the writing on the wall.

00:07:58.940 So why is it that they are sort of denying the fact that printing money correlates with money

00:08:04.640 being worth less?

00:08:05.900 Well, because they're profiting off it.

00:08:09.540 Printing money is highly profitable for big government and big business.

00:08:15.440 So, you know, a lot of a lot of media say, well, even the banking economists endorse this

00:08:20.060 money printing.

00:08:20.700 Well, of course, of course they endorse the money printing.

00:08:24.140 They get the money.

00:08:25.680 Where do you think the money goes first?

00:08:28.480 They are the first ones to touch it.

00:08:30.280 So this is how it works.

00:08:31.420 There is there's this thing called modern monetary theory, as you point out.

00:08:35.820 Others people call it the magic money tree, MMT, or more money today.

00:08:41.040 And it is this socialist idea that governments can just keep printing cash to pay for sumptuous

00:08:49.280 welfare state spending.

00:08:50.900 The Liberals here in Canada and the Federal Reserve in the United States have a twist on

00:08:58.200 it.

00:08:58.380 They call it quantitative easing.

00:09:00.740 So where modern monetary theory has the central bank print the money and literally just hand

00:09:05.720 it over to the government to spend the Liberal government and the U.S. government in Washington

00:09:12.600 and other central banks around the world have something that's even more devious.

00:09:16.980 And that is to allow the financial institutions to play middleman and profit off of all of these

00:09:24.140 transactions.

00:09:24.780 And they call this quantitative easing.

00:09:27.680 What a great what a great euphemism.

00:09:29.140 It sounds so calming.

00:09:30.500 And so it's so soothing.

00:09:32.480 Exactly.

00:09:33.140 Whenever they come up with a with, you know, a 15 syllable technical term that no one can

00:09:41.320 understand, you know, they're hiding something here.

00:09:44.740 But here's how it actually works.

00:09:46.340 The government sells bonds when it runs deficits.

00:09:49.920 A bond is like an IOU.

00:09:51.160 So the government says, here's a bond that I promised to it's a promise from me to you

00:09:58.680 to pay you a certain amount of money in, say, five years and to pay you interest in the

00:10:02.360 in-between time.

00:10:03.120 That's how governments have raised money for deficits for years.

00:10:07.080 But what's happening with quantitative easing is that the Bank of Canada then goes and buys

00:10:12.240 the same bond right back.

00:10:13.640 So the government goes to a financial institution, sells a bond to raise some debt.

00:10:21.180 And then within days, our central bank, which is part of the government, buys the bond back

00:10:26.660 at a higher price.

00:10:28.840 In other words, the financial institution profits off the difference between the price for which

00:10:34.440 the government sold it, the bond, and the higher price for which the central bank bought

00:10:39.940 it right back.

00:10:40.800 And the effect is to allow banks and credit unions and insurance companies, private equity

00:10:48.960 firms to profit off of the difference between what our government sells and what our government

00:10:54.420 pays for those bonds.

00:10:56.720 The other thing it does is it floods financial institutions with easy money.

00:11:01.300 If you want any proof of how the impact of this, look at the Bank of Canada's report just

00:11:07.300 last week on the investors, real estate investors, getting 100% increase in the number of mortgages

00:11:15.360 they've had in a year and a half.

00:11:17.280 That increase began in April of 2020.

00:11:22.020 Well, what happened one month earlier?

00:11:25.120 Quantitative easing began.

00:11:26.280 So all of this cash started funneling into the financial system, and it got lent out to

00:11:31.280 investors who then used it to bid up the price of real estate.

00:11:35.220 And since that time, we've had a 32% increase in real estate prices.

00:11:40.100 And that has priced poor working class people out of homes while making the existing mansion 0.99

00:11:46.740 owners or investors extraordinarily rich.

00:11:49.220 It's also ballooned the stock market.

00:11:50.780 For the first time, our stock market is worth about 130% of GDP.

00:11:56.160 So what happens is when all this cash goes into the system, it inflates the assets that

00:12:01.200 the rich own and the products that the poor and working class must buy.

00:12:07.420 So quantitative easing in the states has bipartisan support, Candace.

00:12:12.840 Democrats love it because it inflates big government.

00:12:16.840 Republicans love it because it inflates big business.

00:12:20.780 Washington and Wall Street are happy, and the working class gets screwed because it destroys 1.00

00:12:27.200 the purchasing power of working class wages.

00:12:30.460 So it's a monstrous wealth transfer from the have-nots to the have-yachts.

00:12:36.580 And so, Candace, you asked, are they smart?

00:12:39.160 Yes, they're bloody smart.

00:12:40.600 They know exactly what they're doing.

00:12:42.820 And that is, they're enriching their friends, the managerial class of CEOs, lobbyists, bureaucrats,

00:12:50.220 corporate lawyers, investment bankers, they all make off like bandits.

00:12:56.240 They're not breaking any laws.

00:12:58.080 They're just profiting from a system the government puts in place.

00:13:01.720 They're perfectly honest people.

00:13:03.500 But the system is profiting them at the expense of the working class who pay the bills in this 0.89

00:13:09.760 country.

00:13:10.060 Well, you make it sound incredibly cynical.

00:13:13.440 You know, usually in politics, if the question is, you know, is something happening because

00:13:18.740 someone is evil or is something happening because someone is incompetent?

00:13:22.740 I usually tend to lean more towards incompetency.

00:13:25.820 But the way that you're painting it seems quite cynical.

00:13:28.960 I know that the Liberal government is sort of intentionally conflating two issues here.

00:13:32.960 They're sort of pretending that their printing of money and inflation is caused by the global

00:13:37.520 supply chain issues, which is a real issue, Pierre.

00:13:39.680 It is happening around the world.

00:13:41.760 I'm buying some new furniture for my house and I'm living it because everything I ordered

00:13:45.360 that was supposed to be here in November is now they're telling me, you know, you might

00:13:48.340 have it in January.

00:13:49.260 So the supply chain crisis is real.

00:13:52.980 The COVID pandemic is having an impact on that.

00:13:55.240 I'm wondering if we could switch and you could address this issue as well.

00:13:59.200 What would a conservative government do to address the supply chain issue?

00:14:02.620 Do you think that Canada needs to do more to take back and build up our own domestic manufacturing

00:14:08.720 industry, have a made in Canada solution the way that we that we see sort of emphasize in

00:14:13.720 the U.S.?

00:14:14.200 Or do you think or conservatives still sort of stand behind the free trade model of having

00:14:20.660 everything sort of imported from China and having costs go down that way?

00:14:25.740 Well, I want to just address one last point on monetary policy with regards to supply chains.

00:14:31.960 A lot of people say, well, there's nothing that the Canadian government or the bank in

00:14:36.300 Canada can do about foreign supply chain costs.

00:14:39.580 Well, actually, there is one very obvious thing, and that is if our dollar is more valuable,

00:14:43.840 then we can outbid other countries for international goods.

00:14:48.160 So while we don't in Canada set the global oil price, if our dollar were higher, then our purchasing

00:14:55.600 power for oil would also be higher.

00:14:57.620 So when governments print money, they deliberately actually devalue their currency, which reduces

00:15:04.040 the purchasing power of their money in the international bidding war for scarce goods.

00:15:11.320 Again, I go back to Switzerland.

00:15:13.200 Switzerland has supply chains too.

00:15:15.780 They have no inflation.

00:15:17.240 Why?

00:15:17.980 The Swiss franc is extraordinarily powerful.

00:15:21.340 When you have a potent currency like that, you can just outbid other countries for scarce

00:15:27.340 and obstructed goods.

00:15:30.980 So that's the first point I would make.

00:15:32.800 Secondly, on supply chains.

00:15:34.920 Well, I go back to my slogan, which was a very deliberate one in the last election.

00:15:41.260 We need an economy that makes more, costs less, with paychecks, not debt.

00:15:45.300 If we had unleashed the productive forces of free enterprise in our country, we could make

00:15:50.840 more things here in Canada.

00:15:53.080 But here it is very expensive to set up a factory.

00:15:56.280 We're ranked 36 of 37 OECD nations for the delay time to get a building permit.

00:16:03.080 So why would you build a factory or a warehouse here when you could go build it where they approve

00:16:08.080 it much quicker?

00:16:08.940 We have an extremely punitive tax regime with payroll and carbon taxes expected to rise

00:16:15.160 January the 1st, which means businesses who are thinking about setting up a factory here

00:16:20.660 or, say, Ohio, will say, well, I'm not going to move to Canada because I have to pay all

00:16:24.160 these payroll taxes and these energy taxes to produce the goods and services that the

00:16:31.740 people need.

00:16:33.220 If we unleashed our energy sector by building pipelines, we could supply more of our

00:16:38.560 domestic energy from Canadian resources rather than importing them from expensive foreign

00:16:46.100 producers.

00:16:47.360 If we reduced the penalty for work that taxes and clawbacks impose, we'd have a greater supply

00:16:53.420 of workers who'd have more powerful after-tax paychecks.

00:16:58.200 You know, we have a million unfilled jobs, Candace.

00:17:00.960 Why is that?

00:17:02.200 Well, we're paying people not to work and then punishing them when they do work.

00:17:06.960 So why are we surprised when people don't work?

00:17:11.280 You know, you get less of what you punish.

00:17:13.540 You get more of what you reward.

00:17:15.220 We should reward work with lower income and payroll taxes instead of rewarding non-work

00:17:21.300 with greater welfare programs.

00:17:24.640 Well, and it's even worse than that, Pierre.

00:17:26.680 I read the other day about how the CERB, which was intended for people who had lost work,

00:17:31.300 that there was about six times as many people collecting it as there were job losses due

00:17:35.880 to COVID.

00:17:36.560 So, you know, what happens when you pay people not to work?

00:17:40.620 People are going to take advantage of that.

00:17:42.040 And sadly, it looks like that's what we see.

00:17:43.820 And then on the other side, you know, my mother-in-law owns a small business in Toronto and she can't 0.84

00:17:47.760 keep employees because, like, why would anyone go out and work if they can make the same amount

00:17:52.700 of money staying at home getting paid by Justin Trudeau?

00:17:55.820 So I want to ask you a final question here, Pierre.

00:17:59.820 I know, OK, so last week, you know, Parliament's back.

00:18:02.200 Last week, the media and the Liberals were completely obsessed with this idea of finding

00:18:06.760 out every individual personal health story of Conservative MPs and finding out why they

00:18:12.440 had exemptions and who was vaccinated.

00:18:14.680 It was a total distraction.

00:18:15.800 And you rightly called out one journalist for falling into a Liberal trap.

00:18:20.300 This week, it seems like the House of Commons is completely distracted by a disingenuously

00:18:24.920 named bill called the Conversion Therapy Bill, but it had unanimous support in the House.

00:18:31.140 Why is it that the issues that we're talking about right now, the things that really matter

00:18:34.360 to Canadians, every time I talk to someone, they're talking about the cost of living.

00:18:37.400 They're talking about how expensive it is to get gas, how expensive it is to go grocery

00:18:40.440 shopping.

00:18:41.240 And yet, when you look at Ottawa, you look at politicians, the media, the government, they're

00:18:45.080 talking about issues that just don't matter at all, that are totally relevant to Canadians'

00:18:50.300 day-to-day life.

00:18:50.920 So you work in politics, you've been on the Hill for a long time.

00:18:55.180 Why is Ottawa so out of touch?

00:18:58.880 Well, the press gallery is largely bought and paid for by the state.

00:19:03.840 CBC, of course, is the state broadcaster.

00:19:07.700 Then they pay journalists from other outlets to do extremely lucrative commentary on the

00:19:16.580 network.

00:19:17.060 Very few people watch it, but it still pays a handsome sum.

00:19:22.380 And so all of those journalists then have to tow the CBC line if they want to keep getting

00:19:26.460 the gravy.

00:19:27.660 And then there's a half billion dollar subsidy for the rest of the outlets.

00:19:33.720 So basically, you have an ecosystem of media who live off big government.

00:19:39.860 And they don't, therefore, want to report on any of the painful consequences of big government.

00:19:45.340 Of course, big government overspending is causing this inflation.

00:19:49.580 A half trillion dollars of deficits mean more dollars chasing fewer goods, driving higher

00:19:55.040 prices.

00:19:55.580 And those who live off of the ecosystem of big government don't want the average Joe on

00:20:03.280 the street to know the reason he's paying more is because the state is spending more.

00:20:11.660 So, you know, they want to talk about every distraction they can conjure up so that nobody

00:20:18.640 realizes why and how the system is screwing them.

00:20:22.760 And so the important thing for us is to call it out, be very honest and very blunt when

00:20:30.140 you get these distracting, phony questions like I did.

00:20:33.980 You know, journalists saying, what are the medical exemptions that four or five Tory MPs

00:20:39.780 have to avoid the vaccination?

00:20:43.740 Are you serious?

00:20:44.960 Like as though I would call people up and ask them their deeply sensitive private medical

00:20:49.840 information, as though that is my job as a member of parliament and finance critic, that

00:20:55.420 is how crazy it's gotten.

00:20:56.680 That's why it's so important to have independent media that doesn't rely on the state and doesn't

00:21:02.360 just toe the government line like your publication.

00:21:07.680 Well, I really appreciate that, Pierre.

00:21:09.680 And it's always a pleasure to have you on.

00:21:11.360 We appreciate your time.

00:21:12.420 I know you're busy.

00:21:12.980 But thank you so much for joining the show, supporting True North and coming on today.

00:21:17.600 I hope you and your family have a wonderful Christmas holiday and we hope to see you again

00:21:21.080 in the new year.

00:21:22.080 Excellent.

00:21:22.540 Merry Christmas to you and your family.

00:21:24.540 Thank you so much.

00:21:25.400 All right.

00:21:25.640 Thank you for watching.

00:21:26.360 I'm Candice Malcolm and this is The Candice Malcolm Show.

Juno News - December 02, 2021

Justinflation is wreaking havoc, so why is everyone ignoring it？

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