Charting Canada’s post-COVID economy

Guests: Armine Yalnizyan, Christopher Ragan, John Stackhouse

SOUNDCLIP

VOICE: The measures we're announcing today will provide up to $27 billion. $55 billion. $650 million. $100 million. $350 million. $9 billion.

RB: You probably lost count there. That is just a sample of the many aid packages ruled out over the past few months by the government. Billions and billions of dollars marked for Canadians and Canadian companies during the pandemic. But tomorrow we're going to get our first glimpse at where all that spending, plus, a workforce ground to a halt has left the economy. Finance Minister Bill Morneau is presenting what the government's calling a "fiscal snapshot" to the House of Commons. And with me now to unpack all of this are three guests. Armine Yalnizyan is an economist and the Atkinson Fellow on The Future of Workers. Chris Ragan is the, is an economist too and the director of the Max Bell School of Public Policy at McGill University. And John Stackhouse is a senior vice president at the Royal Bank of Canada. Hello, everyone.

CHRISTOPHER RAGAN: Good morning.

ARMINE YALNIZYAN: Good morning.

JOHN STACKHOUSE: Good morning.

RB: Well, I am anxious, excited for tomorrow, but that may be because I enjoy these kinds of things. I want to get to a quick take from all of you on where you think our financial position is right now. We know some basic things in terms of what the PBO, the parliamentary budget officer, says about the deficit, what's happening with our growth. But where do you think we are right now in terms of our financial position? Armine Yalnizyan, I'll start with you.

ARMINE YALNIZYAN: Well, we started off much stronger than many countries, and it's true that we've poured money at the problem. And I think it will not be a problem going forward if the next phase of what we are spending helps us boost growth because the best economic agent in society to hold debt is the federal government. It's the cheapest, lowest risk debt in the entire ecosystem of debt. So really looking forward to hearing how they are going to be spending going forward to boost the economy. In other words, the GDP part of the debt to GDP.

RB: Yeah, and that's why the finance minister at one point said, listen, in an interview last week, he said we took on debt, so Canadians didn't have to. Chris Ragan, what do you expect to see about our position right now?

CHRISTOPHER RAGAN: Well, I think it will be interesting to see for the first time now some sort of precise estimate of how much spending is expected to rise over the next year, how much revenues are expected to fall, because both of those will be significant. And then whether we will be projected to have a $250 billion deficit or more or perhaps slightly less. These are huge numbers. I actually think the government deserves credit for for creating the relief programmes that it did. And I think they were the right thing to do on the scale that they did them. But what I would like to see is some discussion about how it gets turned around when that's appropriate, because I don't think these are small numbers at all. I don't think we're in an emergency situation at all fiscally. But I think it does matter that we are incurring a huge amount of debt. And I think at some point you have to start talking about, you know, what your plan is to bring it back.

RB: OK. And we will talk about that a little bit too. But John Stackhouse, where do you think we are at right now?

JOHN STACKHOUSE: Yeah, I think we should expect a bit of shock and awe from Bill Morneau. The numbers will be unlike any that we've seen before, deficits in the $250, $260 billion range. But Chris and Armine are right. I mean, this is manageable. The big question I think we're waiting for is how much is the government willing to pivot on its spending? It's going to be incurring much more debt going forward. That's fine. It's manageable. But is it going to be spent on the same programs, on the same needs, or are we going to see a shift to those sorts of growth drivers that Armine mentioned earlier. And that's where the view that we've got to start to see that transition, you know, in the months ahead. It doesn't have to happen this week, but it's got to start happening.

RB: Before I talk about growth, I want to talk about the CERB, the Canada Emergency Response Benefit that really helped so many Canadians in the initial few months of this pandemic. Some Canadians still using it as the government moved to extend it, but the conversation now is really how do we get out of that? How do we get people into the workforce and off CERB? So let me start with you on that Armine. When is the responsible time to phase that out? Cause certainly the Conservatives have been putting a lot of pressure on the government to try and incentivize people to return to work.

ARMINE YALNIZYAN: I certainly understand that pressure because, you know, in the middle of any recession, you're still going to have some labour shortages. And we are seeing that, but we are in a pandemic. And so consequently, whatever it is they announce on the transition needs to take into account that we are not through a pandemic yet and we are going to need something beyond eEye which is not ready to serve the population. Did you know that even though more women got unemployed in this pandemic, fewer of them are receiving CERB than men, which I found really interesting. Quite significantly, more men are receiving CERB than women.

RB: And why is that? Why is that?

ARMINE YALNIZYAN: I have zero idea. I know it was still eligibility issues like it did not reach everybody. And so what was the pandemic has showed us is we are not, we're not done with the pandemic and when we don't have an income support measure, I completely agree that we're going to need to reform our income support systems for the working aged. That's going to require a lot of deep thought. But EI isn't, going back to EI is not the answer to what we need right now.

RB: Right. And so let me now move to what happens next, because I'm not sure that tomorrow's fiscal snapshot is is going to be able to show us that. At least that's what the prime minister has signalled. Chris Ragan, what sectors could benefit from, I don't know if it's stimulus spending that we're talking about, but something from a little additional help. Chris?

CHRISTOPHER RAGAN: Well, I think there probably will be discussion about stimulus spending. And here I would also want to raise a cautionary note. I think, you know, the recession that we are right in the middle of is a very different kind of recession. I mean, most recessions are a collapse of aggregate demand. And so the policy response is to either lower interest rates or increase government spending to increase aggregate demand. I think there's some of that going on here. But most of what's going on here is actually an inability to produce and to generate income because we can't go back to work or we can't go back to work with the sort of normal numbers that we usually have. And so you think about if the government increases its demand on infrastructure spending, that will increase aggregate demand by definition, but it doesn't actually increase GDP or national income unless you can produce that greater volume of output. And we can't produce at the scale that we're used to producing until we can go back to work. So I think the government needs to actually not jump on the kind of traditional stimulus recipe. I think it actually needs to think more carefully about the kinds of policies that it can use to actually help people get back to work. So one of those might actually be what do we do about the kids? Right? Can we have policies to actually make it more, you know, make it more effective, right? For kids to go back to school or day-care. But then it's also how do we actually make it safer in the workplace? And I don't think any of this is easy, but without getting people able to go back to work, it's very difficult for me to see how a traditional stimulus would work at all.

RB: Yeah. John Stackhouse, I mean, there's no way it's gonna be like in 08 when we just, you know, went around and put shovels in the ground everywhere. That's not going to work this time around. And Chris is right, if kids are all sitting at home, still no one's going anywhere anytime soon, particularly the majority of women. John?

JOHN STACKHOUSE: And you'll remember in 08-09 how difficult it was to get shovels in the ground and that was a completely different environment. There is no green light ahead. It's gonna be flashing amber for a long time. And we have to remind ourselves that we are in the early stages of a long term or medium term transition. This is going to take 18 to 24 months. And the government governments, because the provinces are going to have to step up as we move forward, are going to have to do to help, whether it's schools, as Chris said, or small businesses gradually reopen. This is a lot like post 9/11 where we've had George Bush coming out saying, you know, go shopping. That's not possible now. So it's going to be month by month, quarter by quarter and easing back and the supports that we will continue to need from government are going to have to help, whether it's schools or small businesses gradually, gradually reopen.

RB: And Armine, are we going to shift the economy just in a completely different direction, given that the length that this may go on? And should that shift and I know everybody will have something to say on this be some sort of green recovery? Because that's what a lot of people are saying, this is the time to do it. Armine?

ARMINE YALNIZYAN: Yes, please. But even more importantly than a green recovery, I think, is the lessons learnt from COVID with respect to inequality. And this is an opportunity to take infrastructure spending, both physical and social, and actually reduce inequalities. You know, we have maps that Statistics Canada generates across the country of income, low income neighbourhoods and cross sections with racial and recent immigrant populations. And you see over and over again that the biggest deserts in access to basic services, by which I mean affordable housing, child care services, health care services, adequate public transit in the big cities. It's just a growth resource. So you don't have food deserts. We can see this happening over and over again in low income neighbourhoods. Now, on the other side of that, we're running into population ageing. Slowing growth was going to be a reality no matter what happened in the pandemic. Suddenly, you know, you can hear that break break screaming on it if you want to maximise potential growth. You need to make sure you don't have natural chokes on where the capacity can be. You can boost the economy from the bottom up by rolling out infrastructure in low income, racialized, high immigrant and indigenous population neighbourhoods by making sure nobody is like lying idle. That you've got maximum capacity to contribute to the economy by putting your money where the returns are highest, not where you can build a gazebo because it's in your backyard.

RB: Yeah, there you're referring to what happened after 08. Chris Ragan, you actually wrote in the Globe and Mail recently than an engineered green recovery would be a terrible idea, which kind of surprises me from you. So explain to me why you think that.

CHRISTOPHER RAGAN: Well, I'm all in favour of green and I'm all in favour of recoveries. I think I guess what I worry about is, let me just back up a little bit. I think the argument for policies that push us in the green direction and drive an energy transition, that argument hasn't fundamentally changed in six months. I mean, if anything, right, our eye may be now more off of that set of policies because we're worried naturally about a pandemic. So to me, the argument for, you know, emissions reducing policies and other types of green policies hasn't changed. So let's you know, let's actually thoughtfully, carefully put together a plan. But I don't think we have to rush because we are you know, we're we're worried about a recovery. We should be worried about a recovery. But back to the earlier points about. About infrastructure spending, as john pointed out, I mean, it was hard enough to do to get shovels in the ground in 2009, it's actually a very difficult thing to spend large amounts of money, both quickly and effectively. So let's build the infrastructure that we need, whether it's economic or social, and let's build that infrastructure to address are income inequalities. I completely agree with that. But we I think if we're going to spend #200 billion in infrastructure over the next 12 years, which is what this government is planning, let's do it in a, you know, in a careful, thoughtful, well-organized way.l

RB: Right. But John Stackhouse, if this pandemic has taught us nothing, it has taught us that we can spend money quickly. The effectively part, I think we will know six months from now, maybe a year from now. But government can pump money into the economy quickly. So wouldn't there be an opportunity here for some sort of shift in the way the economy works, the way this country works?

JOHN STACKHOUSE: Yeah, but it's important to reflect on how some of the spending has worked. In fact, it's been oversubscribed. And there's other programs that have been undersubscribed. As Chris said, it's difficult to spend money, and it's important to often just work with what's working. So where can money flow in this country? It was really interesting in the early months, you know, through spring we had RBC track consumer spending and one of the areas of spending that was really strong through the spring was home renovations. PeoplewWere kind of fixing up their homes for obvious reasons.

RB: They were sick of their homes. Yeah.

JOHN STACKHOUSE: Yeah. So and you saw the line-ups at all the usual places. So how do we sort of work with that to to help Canadians retrofit their homes? Because one of our big challenges on emissions is buildings and that ranges from all of the buildings that we're probably in now to office towers and industrial parks. So some of that's easier than other targets. But how do we get Canadians retrofitting buildings?

RB: Rosie, can I add a point?

CHRISTOPHER RAGAN: At the home level or at the institutional level?

RB: Yeah. Okay. Yeah, go ahead, Chris. Yeah.

CHRISTOPHER RAGAN: I just wanted to make it make the distinction between spending gobs of money as the federal government currently is giving relief cheques to people, that that is as it has turned out, it is a much easier thing to do than spending the equivalent sum of money on infrastructure projects. I mean, infrastructure has to be created. It's got to be conceptualized. It's got to be designed. It's got to be implemented. It's got to be environmentally reviewed. It's you know, there's a huge long process for doing infrastructure. Giving somebody a cheque is a much easier thing to do. And so make that distinction because most government spending actually if we're talking about stimulus or long run benefits from infrastructure, it's not nearly as easy to do as what they've currently done.

RB: Fair point. Armine, let me go back to you and just ask you what what big challenges aren't being discussed enough as as we consider how we move forward now?

ARMINE YALNIZYAN: Well, we absolutely mathematically cannot get to the recovery that both gentlemen have noted. Whether we're talking about recovering GDP or we're recovering the number of jobs, unless we pay attention to the thing that Chris raised earlier and that we all know as women is what happens to the kids. There is no recovery without a shecovery. There is no shecovery without childcare. We are not talking about that sufficiently and it is not a provincial issue. It is a national, it is of national importance and we need a national plan. And the crickets and the federal government on this one is absolutely incomprehensible. 57 percent of GDP is propelled by household spending. If you knock out a significant proportion of women because they can't get back in to the workforce, even if they have a job, because child care is gone, you have decided you are opting for a depression, not a recession. It's just going to go on and on and on. John Stackhouse said it was gonna go from 18 to 24 months. If we lose that type of capacity for child care that they are now estimating in the United States, 50 percent of their childcare is at risk of being shuttered, four and a half million spaces, which is far less than our capacity. But if we lose it, we're not getting those women back into jobs. We cannot do it. We cannot achieve a recovery if household incomes fall. You know, we wanted women to be equal partners. They rolled up their sleeves. They were 50 percent of the employees labour force and they can't get back yet. We need a plan.

RB: And I should point out, the federal government has $14 billion on the table to the provinces. And they say in that money they could deal with child care, but they don't seem to have reached any agreement with any province quite yet. John, what is the biggest hurdle here that we are not thinking about, not talking about enough?

JOHN STACKHOUSE: Well, absolutely, Armine is right. Childcare and schools, part of that is critical along with transit. And those are, well, we need a national approach to childcare and there's an opportunity here. It's kind of interesting that we came into this crisis with a pharmacare debate at the forum, we may come out of it with a childcare opportunity.

RB: And long term care.

JOHN STACKHOUSE: And long term care. Thank you. But the provinces and municipalities, which face a fiscal challenge far beyond the federal government because they can't borrow as easily, have to lean into those challenges. And that's, you know, back to back to those difficult conversations around Confederation and the powers of the cities. But cities, municipalities and towns have to be key drivers of the transition to recovery over the next six to twelve months. They've got to be reopening schools in a careful way. Look at what's going on in Europe. In Denmark and Germany, for instance. Really good progress. Let's not just look at the United States where there's a lot of challenges. There's progress being made in a lot of European countries, in Australia. Getting schools back and running, so that will be critical. And then thinking about small business. To Armine's point about the she-covery. Women make up a disproportionate share of small business operators in this country and they were clobbered by the shutdown. We produced a report called Small Business Big Pivot, which emphasises the need for this to be a small business recovery, but it's going to be difficult because small businesses can't open.

RB: Good point.

JOHN STACKHOUSE: They can't turn on that light right away. We've got to help them transition.

RB: Thanks John. Chris, I've got 20 seconds for you on the biggest hurdle we're not talking about.

CHRISTOPHER RAGAN: Well, what I would like to see talked about, and I suspect it won't happen yet, but it will happen in the next few years, is what are our government priorities? So if we are going to talk more and spend more on day care or or elderly care or, you know, other things, then and our fiscal situation is going to be considerably worsened, which it clearly is, then we probably want to also say what kinds of things will government stop doing? So I actually think there's needs to be a big conversation in our near future about rethinking government priorities because it can't just keep increasing.

RB: Thank you all. You prepped me well for all my work tomorrow. Thank you so much. I appreciate it. Armine Yalnizyan, Chris Ragan and John Stackhouse. Thank you. I appreciate it. Armine Yalnizyan is an economist and Atkinson Fellow on The Future of Workers. Chris Ragan is an economist and director of the Max Bell School of Public Policy at McGill. And John Stackhouse is a senior vice president at the Royal Bank of Canada. And that fiscal snapshot is going to happen inside the House of Commons tomorrow by the finance minister. So we'll bring all the latest to you on that as well. OK, the CBC News is next. And then we're gonna go back to Martensville, Saskatchewan, where three decades ago the community was plagued by fear and allegations of satanic ritual abuse. I'm Rosemary Barton and you are listening to The Current. Back in a moment.

[Music]

Uncover: Satanic Panic - Episode 4

RB: I'm Rosemary Barton and you're listening to The Current. This summer on The Current we're bringing you some of CBC's great podcasts. And today we continue with Season 6 from Uncover. Just a warning here: This story contains descriptions of alleged child sexual abuse. The podcast takes us to Martensville, Saskatchewan, three decades ago. People there were gripped by fear that satanic ritual abuse was being performed on local children. Here's Lisa Bryn Rundle with the fourth episode of Uncover: Satanic Panic.

[Crickets chirping and footsteps]

VOICE 1: On March 20^th…

VOICE 2: Run!

[Heavy breathing and running]

VOICE 1: Only one movie experience this year will make you afraid to breathe.

VOICE 3: You won’t survive.

VOICE 2: We have to try.

VOICE 1: A Quiet Place: Part II. In theatres March 20^th. Tickets on sale now.

[Music]

ANNOUNCER: This is a CBC original podcast.

MARJALEENA: You know, I think maybe my first intervention was to go get up at that meeting and then say, you have no business talking like that. We still have a, you know, presumption of innocence and you are basically condemning these people.

LISA: Marjaleena Repo is an activist and writer in Saskatoon with a special interest in justice issues. And she's a force.

MARJALEENA: There's not a guilty person there. I don't only believe it, I know it.

LISA: She says she knew without question from the moment the story broke that the Sterlings were innocent. And so were all the other accused.

MARJALEENA: And this is before the charges were really laid out. They would organize a meeting in a Martensville area for parents, information meeting, and the people that they invited as speakers were members of the committee against the ritual abuse of children.

LISA: She's talking about one of the first town meetings held in Martensville. It was in reaction to the June arrests of nine people for the systematic abuse of children. The invited speakers called themselves experts in satanic ritual abuse. This committee, led by a local reverend, was formed in the late 80s to tackle the burgeoning phenomenon. The committee leader told the Saskatoon Star Phoenix around this time that, quote, "With ritual abuse, we're sort of where we were 10 to 15 years ago with sexual abuse. Back then it was hard to convince people that children were being sexually abused. Now it's difficult to convince people that children can be sexually and physically abused in a satanic ritual context." But in fact, convincing people was getting a whole lot easier. And committee members were frequently invited to speak in the media and at events like this one.

MARJALEENA: So basically you had people who were the true believers presenting to a, you know, pretty alarmed group of parents that this might be happening or might have happened to your child or, you know, et cetera, et cetera. And that's when I jumped in.

LISA: I asked Marjaleena what kind of reaction she got.

MARJALEENA: Not a very good one.

Shocked, and nobody applauded. One of them, big, big hulking guy told me that I had no business being there. This meeting was only meant for people in Martensville. I said, you try to toss me out. We'll see what happens.

LISA: You jumped right in. Why did you do that?

MARJALEENA: Well, I-- I think my main thought was all the time, from the very beginning, if I don't do it who will? I had understood that there was such a thing as mass hysteria. And I thought, who else is going to say anything?

JOHN: The judge read out his decision that I'm an innocent man. What happened to me should never happen to anybody.

RICK: We come along as a task force, and we're going to organize the material and we’re going to move the investigation forward. But at the end of the day we start to see flaws.

REPORTER 1: She was 18 at the time of the offences. The judge found her guilty on seven charges dealing with the sexual assault of two boys.

DAN: We all knew which way the story was suddenly going then. Not what went wrong with the kids, it was what went wrong with all of this?

OVERLAPPING VOICES: Ritual abuse…I’m sickened by it all…The accused didn’t mention satanism…the children should not have to be tortured a second time around.

LISA: I'm Lisa Bryn Rundle. And this is Uncover: Satanic Panic.

Episode 4, “There is still time to wake up”.

REPORTER 2: The Sterlings came to court to hear the reading of the charges. They had to stand for 25 minutes as they heard 60 charges read out to them

LISA: It's late summer 1993. Ron & Linda Sterling and their 23-year-old son, Travis Sterling are being tried together.

REPORTER 2: The charges include trying to suffocate a child, threatening some with a gun and sexually assaulting up to 15 boys and girls in their care.

LISA: The Sterlings have pleaded not guilty to all charges.

REPORTER 3: 108 prospective jurors are called. The most in Saskatchewan history.

LAWYER: We have to screen out a substantial number of people that have formed an opinion.

REPORTER 3: It takes days for lawyers to settle on six men and six women.

LISA: It promises to be a long and difficult trial for all involved. And sitting right up front, taking copious handwritten notes, is Marjaleena.

MARJALEENA: There's everything in there. This is all the different charges…

LISA: She's still got those notes, along with all sorts of other papers from the time. She's flipping through a stuffed banker's box as she recalls the Sterlings' trial.

MARJALEENA: Well, the mood was tense. Always tense, because when you look at the jury, you don't know what they're thinking. And I knew what I was thinking, I was thinking these people have gotten all that propaganda and the false information. And how could they actually overcome. And so I was watching them a lot and their faces don't reveal anything till the very end.

LISA: Marjaleena didn't know the Sterlings at all before reading their names in the newspaper just over a year before the trial. But now, she's here in the courtroom to bear witness and to offer emotional support. She checks in on the Sterlings during breaks.

MARJALEENA: It usually was just like a nice way to get in touch with them and pat them on the back and saying, you know, this is-- this is can't go anywhere.

This is clearly a-- can't result in conviction. I had a feeling all along, it can't, it can't.

LISA: She says Ron tries to stay positive.

MARJALEENA: He's known to be a very nice man. He's very jovial kind of gregarious guy. He wants to make contact with people, cracks jokes. And, you know, he tried to make make light of what was heavy. It was harder for Linda. She looked like doomed. You know, she had already been doomed. They had to have endurance to go through this and try to remain human.

LISA: The Crown is up first. Prosecutors Bruce Bauer and Leslie Sullivan will argue that the Sterlings used their home daycare as a hunting ground for victims. That over the course of three years, they and an assortment of local police officers abused children in their home and at a building just out of town.

REPORTER 4: Police officer Claudia Bryden comes to court with a briefcase full of notes on the nine month investigation against the Sterlings. Up to now, Bryden has never had any problems answering questions. But today she had to ask the judge for a break. Bryden was reading a transcript of an interview she did with a child. The child was describing a sexual assault. Bryden started to wipe tears from her eyes.

LISA: The lack of physical evidence continues to be a problem for prosecutors.

REPORTER 4: The Crown alleges the children were driven here in police cars and assaulted by the Sterlings. This police officer says they searched the building for blood and hair particles. They found nothing. He says there could be three reasons. There was nothing to find, he couldn't find it, or everything had been cleaned up.

LISA: Just as with the previous trials, this one hinges on the Crown's ability to present a convincing narrative to support their key evidence, the children's testimony. One by one, the children tell their stories. And what they have to say is hard to hear.

REPORTER 5: Child number four talked about being locked up in a cage. ”There was just me and Travis. He came up close to the bars. He would touch my bum and penis. I felt lonely and scared, scared about what would happen next.”

LISA: Three months in, before the prosecution has rested their case, the trial becomes the longest in the history of the province.

A reporter asks Travis Sterling…

REPORTER 6: How does it feel to be a part of the longest trial in Saskatchewan?

TRAVIS: It's not real entertaining.

LISA: Soon, it'll be the defence's turn. But just as the prosecutors are wrapping up their case, they make an unexpected move. They decide not to pursue 15 of the 60 charges against the Sterlings, citing lack of evidence. The number of alleged victims falls from 15 to 11. And where the case will end up is anyone's guess. Through it all, Marjaleena speaks up for the accused in any forum she can find. She hands out flyers saying things like,

"The oldest child who has been the main crown witness said in court that 'Linda Sterling cut off the nipple of one of the children and swallowed it'. FACT There is no child with a nipple missing and yet the trials go on!"

"Two of the boys claimed that they had had an axe handle and vibrator shoved inside their penises and anuses. FACT If such a thing would have occurred, both boys would have required major surgery to repair the damage. They show no injuries whatsoever!"

[Music]

MARJALEENA: I wrote articles. My first article was published in a Globe and Mail because Star Phoenix couldn't publish it.

LISA: According to Marjaleena, the Star Phoenix refuses to publish her article, telling her it would bias potential jurors.

MARJALEENA: This would be damaging. Meanwhile and I pointed out in the article all the different articles that they had had showing how satanic cults are everywhere and very much in Martensville.

LISA: In her article, she points out the absence of corroborating evidence in the Martensville case. She calls the children's accusations "fairy tales." And she criticizes the media's gullibility and their portrayal of the accused as guilty.

MARJALEENA: The media's role was atrocious.

[Pages flipping]

MARJALEENA: So this is just a typical-- typical fare, full page articles about satanic cults.

So when you have that put on the public no wonder everybody was saying where there's smoke, there's fire. It became very clear just before the Sterling's trial because the lawyers, they presented a survey that they had done about opinions of people in Saskatchewan, in Saskatoon. And the defense lawyers had polled 600 people and out of those 600 people only four believe that the Sterlings were innocent.

LISA: The final words of her first article are a call to action."There is still time to wake up," she writes. And there was. Her warning came nearly a year before the start of the trials.

Marjaleena remains energetically disdainful of the way the Martensville Nightmare unfolded.

MARJALEENA: The investigations were conducted in an already-- in an atmosphere of moral panic.

LISA: A panic that Marjaleena believes was made possible by the place itself.

MARJALEENA: Well it's a religious community. And a very central feature in this community was the Alliance Church which is very fundamentalist. A lot of the parents belonged to that. And in that church every Sunday you will hear about Satan and what Satan does and how Satan seduces us and how does this and does that then destroys our families and, you know, there was a scare mongering kind of thing built into certain religions and the children would get something in the Sunday school and they would get something at home, and they would listen to the parent talk about Satan and terrible people and whisper things. It's very easy to create a, you know, that kind of mood.

LISA: Marjaleena didn't know it, but there were others quietly sounding the alarm inside the investigation. Members of that special RCMP led task force. They began warning prosecutors of potential weaknesses in the case before the first trial began. This set off tensions between the task force and prosecutors. At one point, in a memo, the head of the task force puts it this way: "We are seeking the truth as opposed to only looking at what will support the charges currently before the court."

Over the course of months, the taskforce members had not just reviewed, but reinvestigated the case. And what they found was damning. Serious flaws in the original investigation including, crucially, in the way the children were interviewed.

CLAUDIA: This case, as you know, started out very simply and very small.

LISA: October 1991, Claudia Bryden gets the initial complaint from the parents of a two year old who goes to Linda Sterling's daycare.

CLAUDIA: The next-- very next priority of course was to identify as best as possible other potential victims. It snowballed because we realized that, you know, the day care was still operating. We had a duty to protect the public.

LISA: This seems to be the moment the investigation begins to go awry.

CLAUDIA: My job at that point if I was able to locate another family was to simply call and let them know that we were conducting an investigation into activities at that home and left it basically at that.

LISA: But at trial, parents say there was more. One mother testifies that Claudia shared information from another child that led the mother to suspect her son had been abused before he made any allegations. Another parent reports that he "all along believed the police, who had informed him that his son was a victim of abuse," despite his son's denials. Claudia tells a different story.

CLAUDIA: Well if that's been suggested that I said to the parent, that person is lying because that's ridiculous. If-- if I said anything to parent at all about talking to their kids, it was always to be careful not to suggest anything to them and to write whatever they might disclose to you down. And that was done so that, or that was a request made so that we could actually show, you know, the flow of information.

LISA: There's also testimony that, early on, families received a children's book. A government-issued resource called "The Secret of the Silver Horse." In the story, a young girl named Jennifer has invited two friends over to see something, a secret object she's rescued from the trash. It's an old hood ornament, but to the kids it's an almost magically beautiful silver horse.

Jennifer has hidden the treasure in the family's back shed and before she'll show it to them, she makes her friends, Terry & Manuel, promise not to tell anyone. Suddenly, Terry began to cry, and the words tumbled out. "Big Person put a hand inside my pants and kept touching me down there. I didn't know what to do. Big Person kept saying I wasn't to tell anyone about it, that it was a secret." Manuel and Jennifer said nothing. They believed Terry and knew Big Person had made their friend very unhappy. "You should tell a grownup," Jennifer said at last. "But it's a secret," Terry sobbed. "No, it isn't," said Jennifer. "It's not a nice secret, not like the horse."

According to court testimony, one child only began speaking of abuse after he had been read the book twice in the preceding week. Another boy reported multiple assaults identical to what's described in the story, but only after reading the book. So did the disclosures come because the book did its job, opening a channel through the shame and fear of speaking up about abuse? Or did it tell the kids what kind of answers the grownups wanted?

Then there was this.

CLAUDIA: These parents were all cautioned on how to talk to their kids, by me, very specifically, and then the caution was, if you have a conversation with your child, you cannot lead them.

LISA: And, in court, parents confirmed this.

CLAUDIA: You have to simply ask very benign questions such as, “Do you like being in daycare?” Or, “How is daycare for you?” That's allowing a response that is not led in one way or the other. And they knew how important it was to not make any suggestions.

LISA: But many of the parents were unwilling or unable to follow those instructions and, honestly, I completely get that. You wouldn't have to say much more than "sexual assault at the daycare" for most parents to freak out. Apart from the 1991 complaint about the toddler, and the earlier complaint against Travis that Claudia had found shoved into the back of a filing cabinet, none of the children disclosed abuse until after police contacted their families. It was only after, quote, "repeated" and sometimes, "highly suggestive" questioning that they made any allegations.

This is from court documents. One child was told twice by his mother that Travis Sterling had sexually assaulted the boy's sister. Another child was told by his parents, quote, "Some of the children that have been babysat at Ronald and Linda's are saying some bad stuff happened there, some bad things, and we just want to know if anything bad happened to you guys."

In the case of one family, a parent admitted dissuading his son from recanting, telling him that other children were also talking about the building out of town. The child had told him he worried he might have invented the devil church.

CLAUDIA: The children disclosed in-- in a particular fashion. And this is the direction it went in, and this is why the allegations that the police led these kids are really unfounded because the kids disclosed first to their parents. That's why they came to the police station in the first place.

LISA: As the case grew, the number of investigators grew too. And, in the end, it's determined by a panel of judges that several investigators, quote, "accepted unquestioningly parents' reports of their children's disclosures, without determining whether that information was obtained in a reliable manner."

"During ensuing interviews, they prompted the children, through the use of suggestive questions, to confirm the version of events recounted by their parents."

In other words, cops influence the parents, parents influence the kids, and then cops do what they can to get the kids to disclose because they already believe the children have been abused.

[Music]

[Crickets chirping and footsteps]

VOICE 1: On March 20^th…

VOICE 2: Run!

[Heavy breathing and running]

VOICE 1: ..only one movie experience this year will make you afraid to breathe.

VOICE 3: You won’t survive.

VOICE 2: We have to try.

VOICE 1: A Quiet Place: Part II. In theatres March 20^th. Tickets on sale now.

[Music]

LISA: In the fall of 1991, Investigator Rod Moor comes to Martensville to assist in the investigation. Disclosures start to pour in. Soon, a pattern emerges. At first, the children have nothing to report. Nothing bad happened. But as parents and investigators persist

and encourage, the children begin to give different answers.

CHILD: Well, I would be wearing my shirt and my pants would be down, not completely off, just down to my ankles.

ROD: OK. How did they get down?

CHILD: They made us pull them down.

ROD: Very good! I'm impressed with you.

LISA: That's Rod Moor interviewing one of the Martensville children.

If you didn't catch that, the child reports that his abusers made him pull his pants down. Moor responds "Very good! I'm impressed with you." Many of the interviews, like this one, were videotaped. I haven't seen those tapes, though I wish I could. Thirty years on, it's not clear if any copies still exist. The bits you'll hear are all that remain publicly available, because they appeared in an old documentary. But even in these tiny clips, you can tell how things could go wrong fast. Rod Moor again.

ROD: So this person that was driving, what do you think should happen to this person?

CHILD: Jail.

LISA: The child responds "jail."

ROD: I agree. And did you know that a policeman has been accused of touching kids out in Martensville…

LISA: Marjaleena watched those tapes.

MARJALEENA: The children told nothing. And when they said nothing happened that wasn't enough.

It wasn't accepted. The children, you don’t believe-- you're supposed to believe, believe the children. That was one of the slogans, “Believe the children!”. Because the interrogators had their own ideas and they wanted to extract that information and they got it. [She chuckles] They got it.

LISA: So you're saying-- they were not believed when they said nothing….

MARJALEENA: Absolutely, when they said nothing happened. And you see that in those videos, you can get children to say the weirdest things because you are basically giving it to them.

LISA: Again from her flyer…

"Another child who first denied that anybody had harmed him in any way, ended up saying after repeated interrogations by parents and police investigators that he had witnessed people being killed, acid being poured on people's faces, and that he was forced to eat feces and intestines which were also stuffed into his ears! FACT there are no dead bodies and no acid damage and no other child has even hinted at such occurrences."

Each follow up interview, and there are many, elicits new details and new accusations against new people. Some children are interviewed by police more than a dozen times. Claudia says the many interviews were necessary.

CLAUDIA: Do we like to interview people more than once? No, we don't. It would be just lovely if you could sit somebody down, including an adult, and get just the full story right off the hop. But with children especially it doesn't happen that way.

LISA: Others disagree, arguing that it coaxed the children into alleging more and more.

Do you recall how many times each child was interviewed?

MARJALEENA: Oh, my goodness, the children were interviewed so many times by the policewoman, policemen, special investigators, their parents because parents couldn't stop asking them questions, and then counsellors.

LISA: Marjaleena points at the people she considers "unprincipled professionals," social workers, psychologists and psychiatrists who advise parents to look for things like bedwetting, not liking doctors, nightmares, or not wanting to go to school as possible signs of abuse.

In Martensville, therapists organized meetings with parents and handed out a check list with these symptoms. Many of the alleged victims also met with therapists regularly. And at trial, the contents of these sessions came under fire. One social worker was forced to admit he had asked a child repeatedly to remember details of abuse, and that under such circumstances a child might feel so pressured to satisfy the interviewer that he would embellish his story.

MARJALEENA: It's like murder of the mind.

LISA: And just to make it totally clear to anyone listening to this, it's not that you don't think sexual abuse of children happens?

MARJALEENA: Oh, my God, that's never the issue. That was never an issue, but it became an issue for the other side. The total other side that any claim of sexual abuse must be true. No questions asked. I was accused of being a supporter. I got public criticism of being a supporter of child abuse, child sexual abuse. I got that.

LISA: Marjaleena used to have a friendly relationship with children in her neighbourhood, inviting them in on occasion for juice and cookies. A practice she immediately halts.

MARJALEENA: Too dangerous.

LISA: Were you accused of being in the cult?

MARJALEENA: Yes. Some of the people said that they knew very well that I was part of a coven.

LISA: Martensville police officer Randy Chudyk also watched the tapes of the children's interviews.

RANDY: Once I was involved in the task force and I was able to see some of the interviews, I was horrified. What stands out for me is the absolute, most unbelievable interviewing I've ever seen. And leading questions, every question was a leading question. A lot of it was, this was the person you saw, right? This is the person that did this to you, right? Or did they touch you here or did they touch you here? And eventually the child would agree with them. And they were rewarded for doing this.

LISA: Kids were complimented for their bravery. They were promised colouring books and, in one case, a visit to see the police dog. They were also told that the interview would be over they could go play after you talk about what happened. Here's an example from a news report.

“Moor patted the doll's backside and said, ‘Has anybody ever touched you back here, right here?’ This got no answer. ‘Who has touched you here, sweetie?’ he asked. Still no answer.

And then, ‘We don't have to talk about this no more, okay? You just quickly tell me once and then we're done. Deal?’ The child nodded in agreement. ‘Okay. Who's touched you back here?’ Finally, she answered. ‘Mmm. A man did.’ ‘Good girl,’ Moor said.”

In spite of Moor's promise to stop the interview, it continued. In the next twenty minutes, Moor asked or told the child seventeen times that someone had touched her. We reached out to Rod Moor, now retired from the Saskatoon police, but we didn't hear back. The interviews took place either in the children's homes or in what's called a soft room, a warmer kind of interrogation room decorated a bit like a living room except this living room had a camera, and anatomically correct dolls. Parents often hovered nearby, at times directly intervening in their children's interviews.

Why do you think Rod Moor and Claudia Bryden were using those techniques?

RANDY: I don't think they-- they knew any different. And-- and I think there was a lot of pressure to get results.

LISA: Claudia maintains that she understood the suggestibility of children, and conducted the interviews accordingly. And that she never offered any kind of reward in exchange for information

CLAUDIA: I would say, I'm here to talk to you about something and I understand you have something that you would like to tell me. And you just simply explain, you know, I need you to tell me the truth. And, you know, it kind of went from there.

LISA: But are you saying, no, that there weren't leading questions?

CLAUDIA: Oh no, there were there were absolutely leading questions, they were intentionally asked. I took dozens and dozens of statements from dozens of kids over a long period of time and in order to clarify things you have to ask questions based on information that was previously given. I follow up and I say, OK, where did you go in this blue car? That's a leading question. You're darn right it is. But I didn't supply the original information. And yes, you have to be very careful not to suggest things. And-- and everybody knows that, it's been a well-known fact for a very long time and it was drilled into us in training and, you know, it's easy to misspeak and accidentally, you know, something pops out. You do occasionally make the odd mistake.

LISA: But an expert brought in by the task force determines that the initial interviews contained several errors, including leading questions and inappropriate rewards. This is the first time anyone with expertise in gathering evidence from children is working the case. He finds that Claudia and Rod Moor's work may have, quote, "contaminated" children's memories and that, quote, "It was not always clear whether the information provided had come from the child or the interviewer." Later, the task force would conclude that the final stages of the investigation had been driven by what they called "emotional hysteria." And all of this raises a whole new disturbing possibility. Not just that the interviews had been compromised as evidence. But that nothing had happened at all.

REPORTER 7: For nearly four months, Ron, Linda, and Travis Sterling have listened to the Crown's version of events. Today, Ron Sterling began telling his side of the story.

Linda Sterling walked into court today. When asked if she touched any of them for sexual purposes or seen anyone else doing so she said “No, I did not.” At one point when describing a child, Sterling started crying. She broke down a second time when describing how her family reacted to her arrest.

LISA: The defense argues that the police investigation was grossly mishandled, especially the interviews with the children.

REPORTER 7: For the first time in the Martensville daycare case, Ron Sterling and his family heard the voices of their accusers. Sterling's lawyer is questioning how accurate those voices are. Last week, Moor agreed with the defense he'd made mistakes in interviewing the children. Today he says he wouldn't do anything differently. He says his technique was the best way to allow the children to tell their story.

REPORTER 8: One defense lawyer asked child number four, “Do you ever have dreams about this?”. The child answers, yes. “And the dreams seem pretty real?” “Yes.” “And sometimes it's pretty hard to remember if it was a dream or if it really happened?” “Yes.”

LISA: Expert witnesses raise doubts about how genuine the children's disclosures are.

VOICE 1: Even though there was repeated pressure and suggestion and questioning over and over and over again, this child denied and denied and denied. Four days later the same child was re-interviewed in a very, very suggestive and pressured interview, and began to say things. But those ideas had been planted four days previously when the child denied everything.

LISA: Then the court learns that investigators went even farther than suggestive questioning.

MARJALEENA: They don't really come up with details until adults give them clues. it wasn't just hints, it was pictures. They had photographs of the so-called Devil's church, which was nothing of the kind. They had pictures of objects there. They showed them to the children and then the children remembered the pictures.

LISA: After police located what they believed to be the Devil Church that one child had spoken of, they began to show children photos of the property, along with items found there and in the Sterling home. It was only then that some of the children said they were taken to that location and began talking about a freezer, a cage, an axe. One panel of judges summed it up this way. "All of the evidence of the children with respect to the description of the property and its contents could have been derived from the photographs they were shown." At trial, investigators were questioned about the way photos and objects were presented to children, sometimes before a child had even mentioned them. In one instance, a child described being assaulted with a vibrator. On cross-examination, Claudia conceded that one child had made no mention of a vibrator until she showed it to him, nor did another child mention assault with an axe handle until shown the axe. When I asked her about it, Claudia added that, quote "All photos of any persons, objects or places that were shown to children by me were done so only on the direction of my supervisor, or superior officers." Back at trial, the lawyers begin their closing arguments.

REPORTER 7: Linda Sterling's lawyer says the investigators were out to get his client. He says the police and parents were guided by their emotions and not reason. He says people became fanatical because of the allegations of sexual assault against children and says that's a normal reaction for the parents. But he says it's inexcusable for the police. And he asked the jury to take an objective look at the evidence and acquit his client.

LISA: It's been five long months and it remains utterly unclear to all involved just where the jury will come down. But finally, nearly two and a half years after Claudia first got the case. arguments come to a close.

REPORTER 9: Today, jurors came to court with suitcases. They won't be going home again until they reach a verdict.

REPORTER 10: In his charge to the jury, the judge commented on several inconsistencies in the children's testimony. Things that children say they remember that could not possibly be true.

LISA: The judge tells jurors the prosecutors have scattered charges, the way a farmer scatters seeds in a Prairie field, in the hopes that some would sprout. A day goes by. Then two. Then three. January ticks over into February. A slow decision is better than a fast one as far as the accused are concerned, but the waiting had to be agony. The deliberating jurors posed a simple question to the judge that boils the trial down to its essence. "If we don't think it happened the way prosecutors say it did, can we convict the defendants anyway?" Finally, days later…

ANCHOR: This morning, the Martensville child sex abuse scandal drew to a close as the jury delivered its verdicts. Ron and Linda Sterling were found not guilty of all the charges against them. But their son, Travis Sterling, was convicted on eight counts including six counts of sexual assault each of which carries a maximum sentence of ten years in jail.

LISA: No one saw that coming. Including Claudia Bryden.

CLAUDIA: The outcome of the big trial, you have three individuals, three adults all charged with similar offenses. The evidence was, you know, the same children giving similar evidence against all three individuals. Only one person is convicted. That's very confusing. If you're a jury and you believe the evidence that a child gives against one person, why are you not believing the same evidence evidence against other people? It should have been all or none, you know.

LESLIE: Not too close, I tend to back up.

LISA: Prosecutor Leslie Sullivan.

LESLIE: We're relieved that we've reached a conclusion in this case.

REPORTER 11: How do you feel about Ron and Linda being acquitted?

LESLIE: The jury heard all the evidence. It was a properly held fair trial. And we accept the verdict.

REPORTER 11: What does this mean for the upcoming trials in the case?

LESLIE: We won't discuss any matters that are still before the court.

LISA: A lawyer engaged to help preserve the children's privacy speaks on behalf of the families

LAWYER: I really don't have that much to say, except that quite clearly the families are disappointed.

REPORTER 12: What solace if any could you provide them?

LAWYER: Simply that it isn't over yet, and that merely because this particular jury found two of the three accused not guilty does not mean that the rest will be found not guilty as well.

LISA: John Popowich is there too.

JOHN: Like I mentioned on these steps back in June, a public inquiry, I think it's about time we had one.

LISA: Ron Sterling emerges from the courtroom

RON: I really don't know what to say. We told people two years ago we weren't guilty of any charges. And neither is our son, we believe that. And we're going to fight this to the bitter end.

REPORTER 11: Can you tell us how this has affected your life and what you've gone through, and if you can sort of rebuild from here?

RON: Well, we've gone through hell, you know. Everybody says these kids have had a rough time these past two years. We're not guilty of any charges, you can imagine what we've gone through. The taint of these charges is going to follow us around, no matter where we go or what we do. It never should have happened in the first place.

[Ron starts crying]

RON: That's it, OK?

LISA: And Linda Sterling…

LINDA: I just hope the parents and the jury can sleep well knowing that they sent an innocent person to jail.

LISA: Ron and Linda are acquitted, not because of legal technicalities or loopholes, but because there was simply no credible evidence against them. In the end, the young offender will be acquitted too, and six of Travis's eight convictions will be overturned. But they don't know that yet. For now, all fifteen convictions stand. And, the people of Martensville who've been watching and waiting yearning for solid answers are left without them. Everyone seemed to agree there was an injustice. But there was little agreement about exactly what the injustice was. That Ron and Linda were wrongly let loose or that Travis and the young offender had been wrongly convicted. And that wasn't going to change any time soon.

For Marjaleena's part, she's proud of her efforts. At least Ron and Linda are free.

MARJALEENA: You know, this was of course my whole intent at the time. You know, of how to-- how to maybe have an impact, how to prevent what I thought was going to be a colossal injustice of everybody getting convicted. And, you know, when I look back at that I think well, that's my contribution.

LISA: Finally, two weeks after the verdict, after Travis and the young offender are granted their appeals and released on bail…

REPORTER 13: The parents of children involved in the Martensville abuse case haven't finished telling their stories. They're angry with how the system has treated their kids. About two dozen parents met with reporters last night in Saskatoon to air their grievances. One father's voice has been disguised to protect his child's identity.

PARENT: We found it frustrating to be unable to provide corroborating evidence to the court that some of our children, especially the younger ones who were not able to testify, suffered the same emotional, physical, and mental trauma as those children that were able to testify. Our well-intentioned friends and family advise us to get over it. They don't understand the abused children have been robbed of their innocence. The children put their faith and confidence in the justice system. It let them down. In their eyes, people convicted of abusing them have been set free. We believe our children and will continue to do so.

[Music]

RB: That's Episode 4 of Uncover: Satanic Panic. This summer, we're sharing some of CBC's hit podcasts with you. We've got more true crime. Plus later in the summer, we'll get a history lesson in the Canadian music industry through the lens of hip hop superstar, Drake, thanks to the new series, This is not a Drake podcast, and it's a good one. Stay tuned for that.

[Music]

RB: That is our program for today. Stay tuned to Radio One for Q. Today, Tom Power sits down with banjoist Bela Fleck to hear about his work chronicling the instrument's ancestral ties to Africa. And don't forget, you can find The Current live anywhere on your phone, your tablet, and catch up on all the show's highlights on demand anytime using the CBC Listen app. I'm Rosemary Barton. Thank you for listening to The Current. See you back here tomorrow.

[Music: theme]

The Current Transcript for July 7, 2020

STORIES FROM THIS EPISODE

Prologue

Charting Canada’s post-COVID economy

Listener responses about long-term care homes and face masks

Uncover: Satanic Panic - Episode 4

July 7, 2020 episode transcript

Social Sharing

More from this episode