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Kim G C Moody’s Musings – 1-1-1 Newsletter For April 2, 2025

 

One Comment About Taxation – Pierre Poilievre’s “Big Idea” on Capital Gains Is Welcome!

 

It’s been fascinating to watch the fawning over Mr. Carney by much of Canadian legacy media (PostMedia being an obvious exception) and a large group of Canadians.  It should not be surprising to me, but it is. It’s amazing to me how many people appear willing to forget the past 10 years of gross mismanagement of our country’s precious resources.  We are an economic mess and the apparent saviour – Mr. Carney – has contributed greatly to the results given his past advisory roles with the government.

 

Unfortunately, some are enamoured with his polished CV and his image of a global statesman and take great pleasure in comparing Mr. Carney’s CV with others. Somehow that translates into Mr. Carney being a great leader.  Spoiler alert:  it does not. That’s a shallow comparison.  If you take two seconds of non-partisan research, you’ll find a track record that is less than glorious.

 

Recently, I was having a chat with some people about the election. One of the persons ended his mini speech about the Liberals’ and Conservatives’ policies by saying he looked forward to reviewing all of the Parties’ policy platforms and voting for the party that had the “best” ones.  Normally I would respect such a statement. That’s reasonable.  However, the Liberals with their shiny new apparent statesman don’t deserve the chance to fix the mess they created, especially given the reasonable alternatives.  Such a platitude does not have my respect this time around.

 

The most recent “statesman politicking” from Mr. Carney was with respect to the phone call that he had with U.S. President Trump on March 28, 2025.  According to Trump’s press release, the call was “extremely productive”.  Mr. Carney’s companion release called it “constructive”.  These press releases were heavy on adjectives and light on substance.  In other words, all about optics, not outcomes.

 

So, with tongue slightly in cheek, here’s how I imagine a post-phone call / press release conversation went (with thoughts being audible as well):

 

President DJT: “Marky Mark!  Great call today.  I told my people it was “extremely productive”.  That’s the headline.  I even threw in “great for both countries”.  You’re welcome!”

 

Trump’s thought: “Keep it vague, DJT, sound like a statesman.  Let the markets speculate.  Meanwhile, we’re steamrolling ahead with our tariffs and a future tax plan…we’ll announce that in the months ahead.  I’m sure we’ll catch Canada with their pants down again.”

 

Mr. Carney: “Thank you, Mr. President.  I also called it “constructive”.  Canadians need to believe diplomacy is alive and well and that I can handle strong personalities like yourself.”

 

Mr. Carney’s thought: “DJT is going to unleash a firestorm of tariffs on April 2.  This presser is about damage control masked as diplomacy.”

President DJT: “I loved the part where you said we’d work on a new economic and security relationship.  Smart move…it leaves me room to announce the deal whenever it happens and take credit for it!”

 

DJT thought: “I think I’m going to call this deal the America-First Fair Trade Accord….yeah, I like that!”

 

Mr. Carney: “We will, of course, be implementing retaliatory tariffs”.

 

Mr. Carney’s thought: “Canadians seem to fall for the word “retaliatory”…our polling numbers go up when we say that.”

 

President DJT: “Do what you have to do.  Just remember we have more capital coming our way.”

 

DJT’s thought: “I can’t wait to unleash our tax package.  While Mr. Carney wants to play games with “capital budgets” vs “operational budgets” to hide massive spending for his tax and spend agenda, we’ll be moving faster.  I can already hear the sucking sound of capital leaving Canada!”

 

Beyond the diplomatic theatre, Canada’s real challenge lies in its economic strategy.  Without bold thinking, big ideas and ensuring our country’s resources are not restricted, our country will continue to struggle and not be equipped for the battle that lies ahead.

 

What have we seen so far from Mr. Carney regarding those “big ideas” that we so desperately need?  Nothing.  Except for big spending announcements that take as much intellect as a mouse to develop and implement.

 

One big idea that was announced by Pierre Poilievre on March 30, 2025 was the automatic deferral of taxation on realized capital gains (from July 1, 2025 to December 31, 2026 but could be made permanent) if such proceeds are reinvested in Canadian assets.  Presently, the Income Tax Act provides very limited opportunities for Canadians to defer taxation on realized capital gains.  This proposal appears to provide a blanket deferral opportunity in the right circumstances and provide comparable results to Americans who also have had a broad-based deferral of capital gains in many circumstances (but recently has been limited to real estate).

 

I would hope, however, that this proposal becomes permanent since I’m convinced the long-term benefits of tax deferral on a reinvestment would be felt much stronger over the long-term rather than only 18 months.

 

For example, with respect to business, by not taxing realized capital gains that are reinvested in Canadian businesses / property, the Canadian government is investing in those Canadian businesses on behalf of all Canadians.  Future profits will be taxed when the reinvestment yields a return, say dividends or capital gains, so all Canadians benefit.

 

While the “tax the rich” crowd might raise their voices on this idea to say it only benefits the “rich”, I say nonsense.  If Canadians – like our wonderful existing and budding entrepreneurs – can defer taxation by re-investing in Canada, this might do wonders to increase the overall economic activity.  Especially if this proposal is part of the overall tax reform that has been promised by the Conservatives by convening a Tax Reform Task Force within 60 days of getting elected.

 

If Canadians want to protect their prosperity and sovereignty, we will need to see past the performative polish of Mr. Carney and remember the poor tax and economic policies of the last 10 years.

 

As the old Latin proverb says, “fortune favors the bold”.  Our country needs bold ideas and substance right now. Not increased spending that is fiscal laziness dressed up as “leadership”.

 

One Comment About Leadership – A Key Leadership Trait is to Teach and Provide “Teachable Moments”

 

One of the key roles of a leader is to grow new leaders and to teach and mentor those people who will carry the torch forward.  One of the aspects of that teaching is when “teachable moments” arise.  What is a “teachable moment” in the context of leadership?  It is those fleeting opportunities where a leader can step in, mentor, and explain, turning that experience into wisdom.

 

As leadership guru, Noel M. Tichy describes in his landmark book, The Leadership Engine, great leaders are great teachers.  They accomplish their goals through the people they teach.  They consider one of their primary roles is to teach.  They use every opportunity to learn and to teach. Great leaders have clear ideas and values, based on knowledge and experience and they articulate those lessons to others.  For Tichy, teachable moments aren’t just happy accidents—they’re cultivated when leaders use their ideas, values, and energy to inspire growth in others (see Chapter 3 of his book).

 

Unfortunately, the phrase “teachable moment” has been used by politicians to try to defend their decisions when the obvious course of action is not being pursued.  For example, Mark Carney used the “teachable moment” phrase on Monday, March 31, 2025 in defending one of his Liberal colleagues – Chiang – who had suggested people turn in his opposition candidate to the Chinese government who have a bounty on his head.  As reported by the National Post:

 

Carney said earlier that he was “deeply offended” by Chiang’s comments and said they demonstrated a “terrible lapse in judgment,” but believes the episode amounts to a “teachable moment.”

 

Wow.  What a bastardized and politicized use of this important leadership concept.  This was not a “teachable moment”.  Instead, it was a serious lapse of judgment from a “leader” to do the right thing.  The right thing to do would have been to fire the candidate and show Canadians that he and the Liberal Party won’t stand for a person who makes light of a serious situation.

 

True teachable moments, as Tichy describes, happen when leaders seize everyday interactions to build capability—like a carpenter equipping their apprentice with tools for life. Or a senior lawyer or accountant providing great mentorship for their new articling students. Again, great leaders teach to achieve their goals through the people they mentor. They have clear, experience-based values and articulate them with purpose.

 

Carney’s spin on “teachable moment”? It’s a masterclass by him and the Prime Minister’s Office (who obviously helped draft that spin) in missing the point—and the mark—of real leadership. Where Tichysees teachable moments as deliberate, values-based opportunities to build future leaders, Carney treats it like public relations damage control.

 

Leaders, don’t mimic this political embarrassment. Embrace Tichy’s vision: teach intentionally, mentor aggressively, and turn moments into wisdom.

 

One Comment About Economics – Carney Proposes That Government of Canada Gets Into the Housing Business?

 

On Monday, March 31, 2025, the Liberal Party of Canada announced the following “housing plan”:

 

  • Create Build Canada Homes (BCH) to get the federal government back into the business of home building, by:

    • Acting as a developer to build affordable housing at scale, including on public lands;

    • Catalyzing the housing industry by providing over $25 billion in financing to innovative prefabricated home builders in Canada, including those using Canadian technologies and resources like mass timber and softwood lumber, to build faster, smarter, more affordably, and more sustainably; and,

    • Providing $10 billion in low-cost financing and capital to affordable home builders.

 

Huh?  The federal government will be in the business of home building?  To compete against our country’s great entrepreneurs?  While I have no issue with public lands being made available to provide housing, I certainly have an issue with the government trying to compete with private business.  And even if they could or would do this vague plan, where will the workers come from??  More immigration?

 

This is a vague “plan” ripe with issues that seems more fantasy than reality.  And expensive.

 

Bonus Comment – Quote From Organizational Psychologist – Adam Grant – About Intelligence vs Leadership

 

“Once you put yourself on the lookout for teachable moments, you’ll find them everywhere!”

 

Absolutely agree!  Leaders, find those teachable moments!

 

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