Hope and home at last

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Thanks for reading Ottawa Playbook. Let’s get into it.

In today’s edition:

→ This week’s Liberal caucus retreat doesn’t have a party atmosphere.

→ MICHAEL CHONG opted for talking policy over dishing out revelations in his testimony in Washington on Chinese interference.

DRIVING THE DAY

HOPE & HOME AT LAST — Prime Minister JUSTIN TRUDEAU will have barely had enough time to get over the jet lag from being stuck in India before his party gets into its first national caucus meeting in London, Ont. this afternoon.

Programming for the Liberals’ caucus retreat started Tuesday and picks up this morning with regional caucus meetings before the main four-hour show with everyone ends by dinnertime.

— Who won’t be there: HAN DONG. The ex-Liberal MP’s official party affiliation, as far as the House of Commons is concerned, remains “Independent” as of Tuesday evening.

Dong resigned from the Liberal caucus in March on the same day Global News published explosive allegations that claimed he advised the Chinese government’s consulate in Toronto to extend the detention of the “Two Michaels” accused by Beijing of spying. Former special rapporteur DAVID JOHNSTON called the allegations “false” — but then his credibility was called into question by conflict of interest allegations, prompting Johnston himself to resign.

— Recall: Intergovernmental Affairs Minister DOMINIC LEBLANC told CBC’s “Power & Politics” host DAVID COCHRANE last week that he will meet with Dong “in the coming days.” LeBlanc and Dong’s offices did not respond to multiple calls and messages from Playbook, seeking an update on the status of that anticipated sit-down.

— The biggest barnacle: Housing (surprise) will be the multi-headed issue MPs will chew on after policy ideas from last month’s Cabinet retreat were withheld from public discussion until buy-in from this week’s caucus meeting.

— On the ground: Liberal MP NATE ERSKINE-SMITH is one of the 89 members of the current Liberal caucus who were part of Trudeau’s original 2015 team.

Erskine-Smith laughed when Playbook asked for his observations on how the political mood has changed compared to eight years ago, saying it’s “certainly different,” though spikes in online vitriol haven’t translated into increased hostility for him at the doors he’s knocked on.

The Ontario Liberal leadership contender, who has been campaigning outside his Toronto riding all summer, said housing is a file over which people have expressed “great frustration” in particular.

— Political bind: Erskine-Smith told Playbook that a related issue that merits a “greater acknowledgment” from the government is the impact of interest rate hikes on affordability.

“If your mortgage has gone up by more than 60 percent since the Bank of Canada started raising rates — and we’ve been quite defensive of the Bank of Canada, it’s an independent institution, that’s all fair — but people are really struggling,” he said.

— Morale, the other barnacle: Frustrated MPs have lamented to Toronto Star columnist ALTHIA RAJ and CBC News’ OLIVIA STEFANOVICH about poor communication and a distracted Trudeau. They’re evergreen gripes, but desperation sparked by new low-polling numbers could make the comments more cutting than in previous retreats.

Erskine-Smith said he’s not interested in that kind of drama at the moment.

“What are the issues that are affecting people’s lives today that need to be addressed? How do we address them with seriousness and ambition?” he said of the questions that should be answered in the next two days. “If we’re not focused on that, then we’re not going to win the next election, nor should we win the next election.”

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For your radar

THE SHOW IN WASHINGTON — Conservative foreign affairs critic MICHAEL CHONG told his story to lawmakers south of the border Tuesday, plainly laying out the facts and warning foreign interference is a “serious national security threat” to Canada and its economy.

Canadian media was all over it. At last check, it barely registered as a blip in U.S. media.

The same thing happened last year when former Alberta premier JASON KENNEY and Natural Resources Minister JONATHAN WILKINSON appeared before a U.S. Senate committee to talk about energy and minerals.

— ‘Corrosive’ campaign: Chong briefly addressed the disinformation campaign leveled against him on WeChat in May. But he was not pressed for details on that, or anything really.

“This is corrosive because WeChat in Canada has over a million users and some 5 million people globally, including many in Canada who saw that disinformation, and so [the PRC has] weaponized Chinese-language social media,” Chong said.

— Damp fireworks: Sparks didn’t fly. Rhetoric didn’t soar. Canada didn’t look weak on national security. JUSTIN TRUDEAU’s name was absent.

He fielded a wide range of questions, including one on whether North America should go on the interference offensive and work to “bring down” Beijing’s leadership. (His response: fund VPN technology to counter state propaganda.)

— Shotgun approach: Chong’s time before the Congressional-Executive Commission on China was largely spent making forward-looking pitches for how to patch the holes the Chinese state is poking into Western democracies.

And the veteran MP brought a quiver full.

→ Screening imports. Work closely with the U.S. on how to stop forced-labor products from Xinjiang, like cotton, from flowing into Canada.

“Some 2.5 thousand shipments from the PRC in the last two or three years have been seized by U.S. border officials and prevented from coming into the United States. In Canada, we’ve yet to seize one shipment. There was a single shipment that was seized but later released.”

→ Toughen up on research. North America should tighten rules on research involving China in sensitive areas like quantum computing, AI, telecommunications, biopharma and clean tech.

“Whether it’s the four Canadian granting councils or in the United States here, the National Institutes of Health and other granting councils, I think we need to make it clear that we won’t fund research in those five areas that’s in partnership with PRC entities.”

→ And many more: Reform Interpol in light of the bounties and arrest demands made for pro-Hong Kong democracy activists abroad, and step up international collaboration for PRC asylum seekers and “provide a circle of protection around those individuals.”

— Where the real story was: RUSHAN ABBAS, founder of the Campaign for Uyghurs who traveled for some 25 hours by plane to testify after Chong, evocatively spelled out a problem Canada also faces in addressing foreign interference with diaspora communities:

“Many Uyghurs in the United States are facing the most significant crisis of our lives, but many of us are afraid to speak out because of what might happen to our lives back home,” she told lawmakers.

“Remember when we used to have these sorts of hearings on the Hill before? A roomful of Uyghurs used to join you, holding pictures of their family members [still] missing. But today, you don’t see many. They are afraid of coming to public events like this as a direct result of [transnational repression].”

— Rear-view mirror: Polling by Leger done for Elections Canada in early March about trust in elections registered concerns for the first time about foreign or Chinese interference, jumping from 0 to 7 percent.

Overall, it found a gradual slide in the general belief that elections in Canada are run fairly, dropping to 78 percent in March from 86 percent in April 2021.

THE 20-YEAR STRETCH — Record public subsidies poured into Volkswagen and Stellantis-LG Energy Solutions electric vehicle battery plants are projected to break even in 20 years, according to a new analysis by Canada’s federal budget watchdog.

The assignment was to find the equilibrium point for C$28.2 billion in public subsidies (which are scheduled to end by 2032). The conclusion blows apart assurances made by Trudeau and Innovation Minister FRANÇOIS-PHILIPPE CHAMPAGNE that Ottawa would recoup its C$13.2-billion Volkswagen investment within five years.

“Government ministers have chosen to use the very rosy picture that everything will happen in Canada because of these two very significant investments,” Parliamentary Budget Officer (PBO) YVES GIROUX, a self-described “heartless” economist, told reporters Tuesday.

Giroux said his conclusion assumes a scenario where production at both facilities are run at full capacity.

— Background: Giroux’s office released a costing note in June that found the federal government’s portion of the Volkswagen deal is projected to cost C$16.3 billion, about C$2.8 billion higher than advertised.

— A key detail: “Following the release of PBO’s June report, the minister of finance clarified that the production subsidies provided to Volkswagen will not be subject to taxation,” read the report.

— Government reacts: Champagne told reporters at the caucus retreat on Tuesday evening that Giroux’s report “basically confirms that the deals that we’ve made are good deals for Canadians, that they’re going to pay dividends for decades to come.”

TODAY'S HIGHLIGHTS

— Prime Minister JUSTIN TRUDEAU is in London, Ont. He has a 12:15 p.m. photo-op with Housing Minister SEAN FRASER, followed by a 12:30 p.m. announcement and media availability. Trudeau heads to the caucus retreat at 2:15 p.m.

8:30 a.m. Statistics Canada will release its second-quarter report on Canada’s national balance sheet and financial flow accounts.

9 a.m. The trial for “Freedom Convoy” organizers TAMARA LICH and CHRIS BARBER continues at the Ottawa courthouse.

6 p.m. (3 p.m. PT) Conservative Leader PIERRE POILIEVRE is in Richmond, B.C. to host a “protect our natural health products” town hall at the Richmond Olympic Oval. He heads to Vancouver’s Oakridge neighborhood for a Rosh Hashanah meet and greet at Café FortyOne at 8:30 p.m. (5:30 p.m. PT).

MEDIA ROOM

— European Commission President URSULA VON DER LEYEN delivered her annual State of the European Union speech today. Check out live coverage here from our colleagues in Brussels.

— It’s CHRIS FORBES 101 (a.k.a. The new MICHAEL SABIA at Finance Canada) in the latest from reporter KATHRYN MAY’s newsletter about the federal public service.

— GLEN MCGREGOR writes for iPolitics that inter-party negotiations on a pharmacare bill have been quietly taking place all summer, with the government facing a “tight timeline” to meet the conditions of the supply/confidence agreement with its NDP dance partner.

— Can the Liberals mount a comeback against a resurgent PIERRE POILIEVRE? A Hub panel offers tips.

— In a new blog post, University of Ottawa e-commerce law professor MICHAEL GEIST ties the Online News Act to a Federal Court case (related to the platform formerly known as Twitter) between Environment Minister STEVEN GUILBEAULT and Rebel News publisher EZRA LEVANT.

PROZONE

Our latest policy newsletter for Pro subscribers from KYLE DUGGAN and ZI-ANN LUM: Chong warns U.S. lawmakers: Foreign interference major threat to Canada.

In other news for Pros:

— The 8 places that will decide the 2024 election

— Biden economic adviser Ramamurti prepares to depart

— Key takeaways from the Pentagon’s new cybersecurity strategy

— Global economy shows early signs of fragmentation, WTO says

— Biden administration releases full recommendations to overhaul mining law

Playbookers

Birthdays: The Globe and Mail’s ROBYN DOOLITTLE celebrates today.

HBD + 2 to GREG MACEACHERN.

Is there an upcoming birthday that we should know about? Email us: [email protected]

Spotted: SNC-Lavalin going full image rehab in changing its name to AtkinsRealis.

Chief Public Health Officer THERESA TAM masking at Tuesday’s Covid-19 briefing, suggesting, “I do think now is the time to get your mask ready if you don’t already have them.”

Movers and shakers: NDP MP RICHARD CANNINGS announced he won’t run for re-election in 2025. The B.C. birder was first elected to the House of Commons in 2015.

PARI JOHNSTON will step into the role of president and CEO of Colleges and Institutes Canada in December … MATTHEW POIRIER is leaving Canadian Manufacturers & Exporters for a new gig as vice president of federal government relations for the Retail Council of Canada. He starts next Monday.

Other fresh starts on Monday: JEAN-FRANÇOIS TREMBLAY moves into a new role as deputy minister of environment and climate change … PAUL THOMPSON moves to Employment and Social Development to be deputy minister there.

VANESSA GOMEZ is the newest member of PIERRE POILIEVRE‘s team. The former Alberta legislative staffer started recently as a tour and advance assistant.

Engagements: Freeland senior policy adviser BLAKE OLIVER and Crestview VP ASHTON ARSENAULT got engaged on Prince Edward Island.

Send Playbookers tips to [email protected].

TRIVIA

Tuesday’s answer: 1980 was the year PIERRE ELLIOTT TRUDEAU’s campaign plane was hit by a bus.

Props to BOB GORDON, GEORGE SCHOENHOFER, KATE DALGLEISH, ROBERT MCDOUGALL and GANGA WIGNARAJAH.

Think you have a harder trivia question? Send us your best.

Wednesday’s question: How many PMs paid rent for living in 24 Sussex Drive?

That question comes courtesy of Ottawa Playbook Trivia champ ROBERT MCDOUGALL.

Answers to [email protected]

Playbook wouldn’t happen without: POLITICO Canada editor Sue Allan, Luiza Ch. Savage and Emma Anderson.

CORRECTION: Tuesday’s Playbook misstated the name of Quebec’s minister of the French language. The minister is Jean-François Roberge. It also misspelled the name of Minister of Culture and Communications Mathieu Lacombe.