Reasonable men and election

Everybody says that they don’t want one. Everybody talks about it. First, it was Michael Ignatieff’s turn. The leader of the Liberal party and the official Leader of the Opposition in one promised to deliver his verdict on the government’s economic report card on Monday. This was expected to be also the verdict on the future of the Stephen Harper’s Conservative government.

The former happened, the latter too. Sort of. A semantic decomposition of the Harper’s report card was rather brief – if the funds for infrastructure investments had been authorized, committed and flowing it didn’t necessarily mean that the money were already there. A clear message was sent on the employment insurance too.

The political part of the message was less plain. Sticking to his trademark, Ignatieff was as direct as two fighting pretzels when it came to answering the question whether he’s willing to bring the government down in the Friday’s vote and trigger an election.

Despite that, the message to the other side of the House of Commons was loud and clear: I don’t want an election, but your report is not adequate and I do have responsibility. But rather than threatening Harper with an early election and being the one who initiated it, Ignatieff played the ball to the other side leaving it up to Harper to decide. That left Harper with the only reasonable option. To react and, in the same pretzel fashion, agree to talk to the leader opposition.

Harper is apparently coming to terms with the idea that the leader of a minority government has a very limited set of options available to keep the job. And Ignatieff made that clear. It’s Harper’s responsibility to make sure the Government has the confidence of the House and it’s the Harper’s responsibility to seek the support of the opposition. Had he chosen to ignore Ignatieff, he would have turned himself into the man who triggered an election nobody wanted.

By the way, Harper made a big deal out of the fact that Ignatieff didn’t ask those question during the Question Period in the House. In fact, pretty much everybody expected the Leader of the Opposition to do so. But by refraining from triggering a fierce showdown over a two-sword-length wide demarcation line in the House, Ignatieff forced Harper, who simply had to react, to go the National Press Theater, which is an environment the Prime Minister doesn’t really like.

I’m a reasonable man, said Ignatieff to avoid being the one who triggered an election. I’m a reasonable man, said Harper to avoid being the one who triggered an election. Nobody wants it. But apparently, Harper doesn’t want it more. Which gives a tiny little edge to Ignatieff. Let’s see how the expected meeting between the two goes.

Ignatieff’s dilemma

At last, the Liberals got something right. They actually let the best candidate to lead the party. Dominic LeBlanc’s withdrew from the race on Monday, Bob Rae followed on Tuesday. That leaves Michael Ignatieff with no-one to run against. Which is fine because he was the best of them anyway. The question is why it has taken so long.

Liberals’ coalition partner, the New Democrats, seemed to be relieved after the leadership mess has been cleared. But what about the future of the Coalition? Ignatieff’s attitude towards the idea is generally described as “lukewarm”.

Should he foster the idea and keep the coalition alive? The treaty, albeit a document enforced under unusual circumstances, is not just a scrap of paper and should be honoured. How it is implemented in the world of real politics is another question. The Coalition makes sense from the perspective of bringing the Conservative government of Stephen Harper down. But what will come next? The Parliament will resume the session on January 26, 2009, more than three months after the election. Bringing down Harper’s government, as was planned, could result in the coalition being asked to form the Government, but it can also trigger new election. After the last week decision to grant Harper the prorogation, it’s very difficult to predict how the Governor General would react.

The new election would give advantage back to the Conservatives and could potentially ruin the Liberals financially. But should the Coalition keep Harper in power? That would potentially ruin the Liberals politically. Should they go on and rely on the GG to sack Harper and ask the Coalition to form the government? Ignatieff will have to be careful.

(Written for World Business Press Online)

Losing on a technicality

Wrangling about Canadian economy continues with a tempo of a badly directed farce. The opposition has finally woken up and made a belated attempt to attack the Conservatives over their silence about Canada’s public finances. The point is that Prime Minister Stephen Harper knew that the deficit was on the cards and wasn’t straight about it in front of the public during the election campaign. And weeks after. Some call it brilliant politics, others call it lies.

The budget deficit is inevitable, even the Tory-appointed parliamentary budget officer said so. Kevin Page dared to blame the Conservatives for the part of the financial crisis due to the GST reduction in 2007. On the other hand, the Conservatives say that the reduction was the right thing to do and point out to Britain’s package announced on Monday that slashes the VAT by two percent. The difference is in timing. Apparently, Harper got the timing right on elections, but had jumpstarted the GST reduction. The moral of the story? One can run the party’s policies out of ideology, but adopting the same approach for the economy is usually backfires.

The other interesting side of the debate is the R-word. The earlier Bank of Canada’s prediction of a “0% growth” allowed Canada to escape recession. On a technicality. Everything was supposed to be just fine. Now, it appears that Canada will indeed slip into a recession. After the Bank of Canada, even Harper and his finance minister Jim Flaherty admitted it’s likely. However, in what can only be described as a desperate attempt to put a positive spine or a gloomy outlook they talk about a “technical recession”. Apparently, it’s only a classbook definition of a particular state of the economy (two quarters of negative growth equals recession) so everything is OK. And, according to Flaherty, no stimulus “package” is needed.

The opposition has every right to point that out and criticize Harper for his reluctance to be straight with Canadians and call a spade a spade, the only question is why they didn’t do it sooner. Harper now tries to get out on a technicality. However, in the long run, he risks the whole country losing.

(Written for World Business Press Online)

Deficit Speech from the Throne

As expected, Governor General Michaëlle Jean’s Speech from the Throne was about Canadian economy and rather grim outlook it faced and hard decisions that were to be made. The speech was, of course, written by Canadian Prime Minister, Stephen Harper and its content was hardly surprising.

The speech contained that much feared word – deficit. Canada had it coming and Harper’s government has been gradually easing in Queen’s offshore subjects to the fact that Canada’s budget would end up in red. On October 22, Ontario announced it would run a $500 million dollar deficit in 2008/2009. The province got slammed from every political quarter of Canada with only the wise men of economics warned that it would not be such a bad thing especially during times of general economic downturn and/or recession. But that was a problem. Harper’s government couldn’t say the country was facing downturn and recession since the Conservatives based their campaign on “everything’s OK” slogan.

Two days after Ontario announcement came the August $1.7 billion dollar federal budget deficit which kick started Jim Flaherty’s (Canadian finance minister) one-week long Great Copernican Shift during which he renounced his no-deficit mantra and adopted more realistic approach – trying to run a surplus no matter what might lead to a long term damage. Even Bank of Canada played its role in the policy of denial. After a 0.4% contraction, it predicted a “0% growth” for the next one. In other words, Canada was suppose to avoid recession. Politically and verbally. A 0% growth can as well be a 0% contraction, the only thing is how would you sell it.

The Throne Speech warned about the necessity of deficits and labeled them as an instrument to protect Canada during economic crisis. Coordinated or not, Bank of Canada governor Mark Carney said, in London, UK, that the situation is worse than the Bank predicted just a month ago and hinted at further reduction of interest rate cuts. “Recession is possible,” said Carney.

In all fairness, neither Harper or Carney could have predicted what would happen in one month time. Neither could opposition leaders. However, budgets and the related decisions are not created overnight, neither are budget deficits. The Conservatives had, of course, one very good reason to keep quiet about the deficit – the federal election held on October 14. They had no economic plan to offer for different economic circumstances during the campaign. The means that kept their momentum fueled, such as high oil prices and perceived Canadian immunity, gone, the Conservative government will really face “hard decisions”.

(Written for World Business Press Online)

Ignatieff for … the Liberal Party leader

Following a disappointing defeat in the October general election, Liberal Party’s leader Stephane Dion announced that he would step down at the next convention. During the campaign, Dion was impersonation of a reluctant leader and unfortunately he played the role of university professor way too often. Whether this was intentional or unavoidable, is up for a discussion. His less then perfect command of English contributed to the overall non-political image.

In its quest for the new leader that would reverse their fortunes, the Liberal party must find someone who will be a direct opposite of Stephen Harper. The Conservatives’ leader Stephan Harper is in many ways politically perfect – impersonal, ideology driven leader, a populist here and there, but generally sterilely average without a long term vision for the country.

Liberals have to choose a leader that will be able to unite the party. This often leads to electing a person who’s sufficiently weak to absorb individual fractions’ influences. Obviously, this is a method that may work for a while but in the long run A) it only delays inevitable disintegration of the party, and B) it is the worst way to provide party with a leader capable of challenging political opponents during the next election and leading Canada.

After Michael Ignatieff announced on Thursday that he would run for the Liberal party leadership, the party got exactly what it needed. Ignatieff’s career and life are most impressive. His international experience shouldn’t be treated as suspicious and nobody should question whether he’s a real Canadian.

Ignatieff is an accomplished historian, journalist, writer and politician, in any order, which makes him perfectly suitable for leading not just the Liberal Party, but Canada as well. In the recent days, amidst international effort to stop or at least slow down the recession, Canada has become a role model for the sound economy. Canadian leader without ideological ballast and international credibility will be the one who the world will surely listen to.

(Written for World Business Press Online)