STEVE INSKEEP, HOST:
What is going on with democracies? Never mind the United States - Germany's government collapsed. France's government is paralyzed. And now Canada's Prime Minister Justin Trudeau faces a crisis. His longtime ally, who served as both his finance minister and deputy prime minister, left his government. Chrystia Freeland resigned with a public letter criticizing her boss. Catherine Cullen is covering this. She hosts CBC Radio's political program "The House." And she joins us now from Ottawa. Hi, Catherine.
CATHERINE CULLEN: Good morning, Steve.
INSKEEP: Why is it such a big deal, this resignation?
CULLEN: Oh, I mean, it was an absolute political earthquake. As you say, Chrystia Freeland, the deputy prime minister, the finance minister, she was the original Justin Trudeau liberal before he was prime minister. He recruited her. He brought her on as a star candidate. And what she did yesterday, it wasn't just a resignation letter, a public resignation letter. The day that she delivered that letter, I was with a group of other reporters. We were headed into the fall economic statement, sort of a mini-budget. She was supposed to deliver this big address on the state of the nation's finances, new information about more than a billion dollars being invested in the border to try to deal with the threat of Trump's tariffs, billions more for investment credits for business. This was, in many ways, her day.
Now, it was a day where she was going to be delivering some bad news, that she had blown an important fiscal target. And we learned from her resignation letter that on Friday, the prime minister had told her that she was essentially being demoted, that she wasn't keeping her job as finance minister. So she put out this letter. She said, listen, I clearly don't enjoy your confidence anymore. I can't keep doing this job. And that meant we had this big economic statement, and no one knew who the finance minister was. It really threw things into chaos. And the fact that she's such a close ally undermines the prime minister.
INSKEEP: Listening to everything you're saying there, I'm trying to figure out if this was a personal disagreement or if there really is a severe policy disagreement about the direction that Canada should take.
CULLEN: I think that there is certainly a policy disagreement. Her letter makes it clear. She talked about some of his recent spending plans as costly gimmicks that Canada can't afford, that we need to show - she said the government needs to show Canadians that they are serious at this time, that they take the seriousness of the situation - and she's talking about Donald Trump's tariffs there - that they have that in hand. So, like, this scathing critique of the prime minister's plans. But it was also clear that he asked her to do something that personally she just would not tolerate, to take this blow for him, deliver this bad news when he had already told her she was being demoted. There's been a lot of coverage in the newspaper about, you know, another star candidate the prime minister might bring on. So I think it was both personal and a policy issue, but really devastating for the prime minister politically.
INSKEEP: I'm trying to figure out - you've mentioned President-elect Trump twice, and I'm trying to figure out where he fits in here. We'll recall that President-elect Trump threatened 25% tariffs on Canada if they don't act on the border in ways that he likes. It's not clear if he will follow through on that or not. Did the prime minister and his top adviser disagree about exactly how to manage that?
CULLEN: It's not clear that that was the case - only insofar as she was concerned about Canada sort of being careful with its economic plans. Justin Trudeau is very unpopular right now, as unpopular as he's been in his nine years in power. And so he wanted to put forward some measures to help Canadians with affordability, handing out $250 checks, a tax holiday. She is suggesting we just can't afford that right now because the threat of Trump tariffs - it would just devastate the Canadian economy, and there's - it's a time for restraint.
INSKEEP: Catherine, can I ask about one other thing? The president-elect yesterday once again referred to Canada as the 51st state, talked about Justin Trudeau as governor. I was home in Indiana, which voted for Trump, the other day, and people thought this was very funny. Do people think it's funny in Canada?
CULLEN: No (laughter) is the short answer - not too amused. And in fact, overnight, Donald Trump posted online once again talking about this, calling Justin Trudeau the governor of Canada and saying that Chrystia Freeland will not be missed. You know, people are saying that we should laugh about this, perhaps, but I think many Canadians find it a bit humiliating.
INSKEEP: Interesting to say that she won't be missed. It's almost taking the side of Justin Trudeau. Catherine, thanks so much.
CULLEN: Thank you.
INSKEEP: Catherine Cullen, a senior reporter for CBC in Ottawa, Canada. Transcript provided by NPR, Copyright NPR.
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