Justin Trudeau's Liberals enjoy the political benefit of strong economic growth, reflected in the Bank of Canada's decision last week to raise interest rates. If things are this good in 2019, Andrew Scheer's Conservatives won't be able to use the economy as an election issue, leaving the Tories with an uphill fight to unseat the Grits.

But Canada is due for a recession in a year or two or three. Recessions, generally speaking, come around every 10 years or so. And history teaches us that bad economic news is bad political news for the government of the day, even if it isn't to blame.

Consider the Diefendollar.

Story continues below advertisement

In the early 1960s, the Canadian dollar came under attack from speculators. Growth in Canada and elsewhere had been sluggish after the roaring postwar years. There had been a recession in 1960-61. To fight off speculators and boost exports, John Diefenbaker's Progressive Conservative government lowered the value of the loonie, as we now call it, to 92.5 cents U.S. The Liberals and other critics pounced, printing "Diefendollars," from the "Bunk of Canada," and accusing the Tories of economic mismanagement. The Conservatives limped out of the election with a weak minority government that lasted less than a year before succumbing to Lester Pearson's Liberals.

For subscribers: Canada's economy at 150: How we shook off the oil shock

Economic issues did in Pierre Trudeau – twice. After lampooning Conservative Robert Stanfield's proposed wage and price controls to fight inflation during the 1974 election – "Zap! You're frozen!" Mr. Trudeau mocked – he turned around and imposed them a year and a half later.

Mr. Trudeau never regained economic credibility. He did, however, regain power after Joe Clark's brief and bumbling tenure in 1979, only to sink himself once again with the market-distorting National Energy Program (NEP), which sought to redistribute Western oil wealth nationally. Not only did the NEP earn the Liberals the lasting enmity of Alberta voters, it coincided with a brutal recession – unemployment reached 12.8 per cent – that virtually guaranteed the Liberals would lose the next election, which they did.

A decade later, another recession helped consign the Progressive Conservatives to electoral oblivion. The free-trade agreement with the United States caused the closing of branch plants, people hated the new goods and services tax, the Bank of Canada sent interest rates soaring to 14 per cent to fight inflation and Brian Mulroney's Progressive Conservative government couldn't get deficits under control. Replacing Mr. Mulroney with Kim Campbell as leader didn't help. The Tories were obliterated in the 1993 election.

Not all elections are fought on the economy. Paul Martin's Liberals were defeated in 2006 thanks in part to the sponsorship scandal, even though growth was strong, inflation and unemployment low and the government was running surpluses.

And bad economic news can actually work in a governing party's favour. Stephen Harper's capable handling of the 2008-09 recession bolstered his economic cred, earning the Conservatives a majority government in 2011.

Story continues below advertisement

But profiting from a recession is an exception to a rule. A serious downturn in or around 2019 would send the Liberal deficits through the roof, both in absolute terms and as a share of gross domestic product, as unemployment claims rise. Efforts to stimulate the economy would balloon an already substantial deficit, raising questions about whether the decision to go into the red when times were good was foolish in retrospect.

A Conservative call for tax cuts to stimulate growth, balanced budgets to rein in interest costs, and spending restraint to bridge the gap might make sense to stressed-out voters. The upcoming NAFTA negotiations could also figure in the mix. Right now, Mr. Trudeau is earning high praise for his skillful handling of the Trump administration. The Prime Minister's Office and cabinet are deeply engaged with the administration, Congress and state governments, with a view to convincing the Americans that North American free trade is in their as well as Canada's interests.

But if the NAFTA talks fail and the President's mercantilist moves – currently he's threatening to impose a tariff on steel imports – bring on or worsen a recession, then Mr. Trudeau will be attacked by the opposition for failing to protect the economy.

That said, the Liberals could dodge the NAFTA bullet and the economy could continue to grow. In that sense, good news for the Liberals would be good news for everyone. Except Conservatives, perhaps.