OTTAWA — Mark Carney earned acclaim for steering countries on two continents through economic turmoil. On Sunday, Canada’s Liberals chose the former central banker to replace Prime Minister Justin Trudeau, as the nation faces economic warfare and threats to its sovereignty from President Donald Trump.
Carney’s win was widely expected. He led in the polling, raised more funds than his rivals and earned the backing of the Liberal establishment. He prevailed over three candidates, including former deputy prime minister and finance minister Chrystia Freeland.
Carney, 59, is expected to formally replace Trudeau as prime minister in the next week. A federal election must be held by October but could come sooner. Carney could call a snap election, as analysts expect, or the opposition parties could bring the government down, as they have suggested they might after a new session of Parliament begins this month.
He will face myriad challenges. None is more significant than that posed by Trump, who has levied tariffs on Canadian goods and threatened to use “economic coercion” to annex America’s northern neighbor and make it the 51st U.S. state. Trump’s actions have so severely ruptured the bilateral bond that officials, business leaders and ordinary people in Canada say the damage could be permanent.
Last week, Trump imposed 25 percent tariffs on Canadian goods, spurring Canada to impose retaliatory levies. Then, over the following 72 hours, he temporarily paused the tariffs for some products, before threatening even more tariffs. Trudeau warned Canada could be embroiled in a trade war for “the foreseeable future.”
During the campaign, Carney cast himself as an even-keeled political outsider with the crisis management experience to take on Trump and manage the fallout of a trade war that could tip the economy into a recession, touting his record of steering Canada through the 2008 financial crisis as Bank of Canada governor and navigating Brexit as head of the Bank of England.
Before Trudeau said on Jan. 6 that he’d step down, the Liberals were trailing the Conservatives by 20 points and headed for a drubbing, polls showed, amid concerns about the high cost of living and a stagnating economy. But since Trudeau’s resignation and Trump’s return, the Liberals have significantly narrowed the gap.
Carney is untested as a politician. He has stumbled in speaking French, which could prove an issue in the battleground province of Quebec. It’s unknown how he will fare in a campaign against Conservative Party leader Pierre Poilievre, a lifelong politician with a go-for-the-jugular style.
“Because [Carney] is so new to the political arena, people are able to project their wishes onto him … to see him as a kind of savior,” said Lisa Young, a political science professor at the University of Calgary. “There’s a set of expectations about who he is and how he’ll perform, and they haven’t been fully tested yet.”
A leadership contest dominated by Trump
The contest to replace Trudeau was an unusually genteel affair. The four candidates spent little time attacking one another, focusing instead on who is best placed to counter Trump’s America First agenda.
Carney vowed to respond to Trump’s tariffs with dollar-for-dollar levies on U.S. goods and to use the revenue to help Canadian workers. He said Canada should focus on diversifying trade relationships and becoming less reliant on the United States.
In his first term, Trump’s “objective was to take more of our market,” Carney said during a debate. “Now he wants to take our country.”
Carney said he supports several Trudeau government social programs, such as $10-per-day child care. But he disavowed parts of Trudeau’s economic agenda. Carney promised to scrap the consumer carbon tax and a planned tax hike on capital gains, and pledged to balance parts of the budget within three years.
“I’m not the only Liberal in Canada who believes that the prime minister and his team let their attention wander from the economy too often,” Carney said at his campaign launch. “ … The federal government spends too much, but it invests too little.”
He pledged to meet NATO’s defense spending target by 2030, which will displease the Trump administration and NATO allies, which have long criticized Canada’s defense spending shortfalls and want it to meet its commitments faster.
The Liberal race was seen as a contest between Carney and Freeland. The pair know each other well, and Carney is the godfather of one of Freeland’s children.
Freeland, 56, a former journalist who covered the fall of the Soviet Union, touted her experience taking on Trump, who she said represented the biggest crisis to Canada since World War II. She earned praise for her role as foreign minister in renegotiating the North American Free Trade Agreement during Trump’s first term — and his ire.
He has called her “toxic” and “a whack.” She has worn his insults as a badge of honor.
Freeland broke with Trudeau in dramatic fashion last year, resigning from the cabinet and accusing him of “costly political gimmicks” when Trump was threatening the economy. Trudeau resigned the next month amid a caucus mutiny after nine years in office.
‘The Canadian hired to save the world’
Speculation about Carney’s political ambitions has swirled for more than a decade.
He was born in a town in the Northwest Territories and raised in Edmonton. He studied at Harvard and Oxford, and then catapulted to the upper echelons of the world of finance as an investment banker for Goldman Sachs.
He began a term as governor of the Bank of Canada in 2008, during the global financial crisis. He quickly cut interest rates to almost zero. When he was named chair of an important global financial group in 2011, he was hailed by Maclean’s magazine as “the Canadian hired to save the world.”
During the Liberal leadership campaign, Carney revealed that then-Prime Minister Stephen Harper, a Conservative, asked him to be his finance minister. Harper has not disputed that claim but has complained that Carney is taking more credit than he merits for Canada’s response to the financial crisis.