When Canadian Prime Minister Justin Trudeau took office in 2015, he ushered in a wave of optimism, diversity and inclusivity. His charisma and vision propelled the Liberal Party from third place to a majority government. Trudeau promised a progressive agenda centered on climate action, gender equality and reconciliation with indigenous peoples — a stark departure from the policies of his Conservative predecessor, Stephen Harper. 

Nearly a decade later, Trudeau’s popularity has steadily declined. While he did fulfill some campaign promises, he fell short on others, and some backfired, leading to a gradual decline in public trust. Economic challenges, internal party divisions and a series of controversies gradually destabilized both Trudeau and the Liberal Party. His resignation announcement on January 6 marked the culmination of years of dissatisfaction.

The economic toll

A key factor in Trudeau’s decline was his government’s inability to address the economic anxieties of ordinary Canadians. Housing affordability became a crisis, with skyrocketing prices and limited inventory in urban centers. Despite government measures such as the First-Time Home Buyer Incentive, Trudeau failed to address structural housing issues.

Canada’s inflation rate peaked at 6.8% in 2022 before gradually declining, while GDP growth languished at 1.3%. Economic uncertainty, driven by external trade tensions and domestic policy shortcomings, further fueled voter frustrations. Under Trudeau’s leadership, Canada experienced its worst economic growth in recent history, with annual per-person GDP growth averaging just 0.3%.

Trudeau’s government overspent, leading to a deficit of $61.9 billion for the 2023–2024 fiscal year, far exceeding the target of $40.1 billion. This fiscal shortfall raised concerns about the government’s ability to meet its financial commitments.

The final blow came in December 2024 when Finance Minister Chrystia Freeland resigned over disagreements about economic management and the government’s response to US President Donald Trump’s threats to impose a 25% tariff on all Canadian imports. This move could raise prices for consumers and businesses, trigger retaliatory measures by Canada and lead to higher inflation and slower economic growth in both countries.

Freeland’s resignation exposed deep divisions within the party and signaled a loss of confidence in Trudeau’s ability to lead effectively. In the weeks before his resignation, Trudeau faced mounting internal pressure as multiple Liberal members of parliament (MPs) publicly called for his departure, citing concerns about his leadership and the party’s future. For instance, Ontario MP Chad Collins stated that the Liberal caucus was “not united” on Trudeau’s continued leadership, suggesting the party needed a new vision.

These internal divisions, combined with declining public support, left Trudeau with little choice but to step down. In his resignation announcement, he cited “internal battles” as a distraction, stating that Canada “deserved a real choice in the next election.”

Public perception and scandals

Controversies marred Trudeau’s tenure and undermined public trust. In 2019, reports revealed that Trudeau’s office had pressured then-Attorney General Jody Wilson-Raybould to intervene in the prosecution of SNC-Lavalin, a major Canadian engineering firm facing corruption charges for allegedly bribing Libyan officials. Trudeau’s office sought to secure a deferred prosecution agreement for the company, allowing it to avoid a criminal trial. The ethics commissioner concluded that Trudeau had violated federal conflict of interest rules by attempting to influence the legal proceedings.

Another major case was Trudeau’s approval of the Trans Mountain pipeline expansion, designed to transport oil from Alberta to British Columbia. It sparked widespread criticism from environmentalists and Indigenous groups, who cited concerns over oil spills and its environmental impact. The approval contradicted Trudeau’s earlier commitments to both environmental sustainability and Indigenous reconciliation, leading to accusations of hypocrisy.

During the COVID-19 pandemic, Trudeau initially saw a surge in popularity due to his steady communication and swift government support programs like the Canada Emergency Response Benefit. However, his popularity waned as the pandemic dragged on, particularly during the Freedom Convoy protests in early 2022. These demonstrations, sparked by vaccine mandates for cross-border truckers, evolved into broader opposition to government restrictions, leading to blockades in downtown Ottawa and key trade routes like the Ambassador Bridge.

Trudeau’s response, including invoking the Emergencies Act, was divisive — praised by some as necessary to restore order but criticized by others as government overreach.

What lies ahead for Canada?

Trudeau’s resignation marks the end of an era in Canadian politics that began with immense promise but ended with significant challenges and disillusionment. The Liberal Party must now grapple with internal divisions, voter fatigue and a growing appetite for change as they prepare for the next federal election. Two key candidates have emerged: former Finance Minister Chrystia Freeland and former Bank of England Governor Mark Carney. They signal a potential shift toward a more fiscally conservative and economically pragmatic approach.

Freeland brings political experience, a strong party base and a proven track record as deputy prime minister and finance minister. However, she must overcome Trudeau’s legacy and the public’s growing frustration with the party.  On the other hand, Carney offers a fresh alternative with strong economic expertise and a reputation as a global leader on climate and fiscal policy that may appeal to centrists and dissatisfied Liberals. However, his lack of political experience and grassroots support are key obstacles.

Currently, Conservative Party leader Pierre Poilievre, known for his populist approach, is leading in the polls. His rise suggests a potential shift towards more conservative policies, reflecting public dissatisfaction with the status quo rather than a definitive embrace of conservatism. Poilievre’s focus on reducing inflation and increasing housing affordability has also resonated with Canadians seeking practical solutions to everyday challenges.

The Liberal Party’s choice of leader will determine whether they can regain public trust or risk further decline. The next election will not only define the country’s political trajectory but also test the resilience of the Liberal Party’s legacy. The convergence of political shifts, trade uncertainties and economic challenges suggests a complex path ahead of Canada. Whether Canadians embrace new leadership, reject the Liberal brand altogether or simply seek change, one thing is clear: The decisions made in the coming months will shape the nation’s future for years to come. 

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.