Featured:
Friday, November 6, 2009 08:24 PM
A whole new game
Prior to this week, the politics of the HST were all uphill for the McGuinty and Campbell Liberals and the Harper Tories.
After all, the issue was taxes, and no one likes taxes.
This was a particularly acute problem for the Ontario Liberals. The federal Tories and British Columbia Liberals are the parties furthest to the right still electorally viable in their marketplace. Voters typically trust left-centre parties on issues like social policy, health or education. They prefer centre-right ones on taxes and security. The more the McGuinty Liberals were talking about taxes, the more they were losing. It wasn’t that the issue wasn’t worth talking about; it was that it wasn’t the issue they should be highlighting.
That changed with the report Jack Mintz of the University of Alberta issued Wednesday.
First off, Mintz’s credentials are unassailable. He has been modeling the economic impact of budgets since 1980. He is no creature of the McGuinty government, having been scathingly critical in the past. His work at the C.D. Howe institute is seen as the acme of public intellectualism in Canada.
The man is the Cadillac of Canadian public policy and economics.
Mintz changed the game with a single fact… His eye-popping estimate of 591,000 new jobs created over the next ten years because of the HST and other tax reforms Ontario made in the 2009 budget.
Let’s put that number into context.
According to Statscan, there are about 7.2 million people in the Ontario labour force. However, only about 6.5 million are currently employed. That leaves around 700,000 people who are out of work.
Over the next ten years, Ontario’s tax reform will create almost enough jobs to employ every single one of those people.
The HST won’t eliminate unemployment. There will be new people entering the labour force, be they New Canadians, those who stopped looking or young people, who will increase the total pool of potential workers. But the HST will go a long way to undo the ravages of the current recession and stabilize the employment situation in Ontario.
In a stroke, Mintz has changed the debate from taxes to jobs.
Liberals cannot win a tax fight. The Ontario Progressive Conservative Party spent the last twenty years branding itself the “tax-fighters.” Those who vote on their dislike of tax long ago migrated to the base of the post-Davis-era, tax-cutting Tories.
Liberals can win a fight on jobs. In fact, the Mintz report shifts the burden to produce a jobs plan from McGuinty to Hudak.
Link to this post
Thursday, November 5, 2009 03:37 PM
Guts matter most
Harmonizing sales taxes takes guts.
Premiers Dalton McGuinty and Gordon Campbell, along with Prime Minister Stephen Harper and Finance Minister Jim Flaherty, deserve credit for doing what’s right instead of what is popular.
But my favourite example of political courage isn’t about taxes or trade or foreign policy.
It's about milk.
In the 1930s, the most powerful lobby in Ontario was the farmers.
Dairy farmers were four-square against mandatory pasteurization of their product to protect against bovine tuberculosis. They argued the science was unproven, but feared the cost of new machinery. No politician would dare cross the farmers, particularly one like Premier Mitch Hepburn who relied on farm votes in Southwestern Ontario for his majority.
Just before the Legislature resumed in 1937, Hepburn accepted the invitation of Dr. Alan Brown, the chief pediatrician at the Hospital for Sick Children, to tour the hospital.
Hepburn confronted two long rows of children infected with the wasting disease. Tuberculosis attacked the lymph nodes and lungs. It leaves the patient weak, feverish, coughing and wasting away. The effect on adults is terrible. In children, the ravages are horrifying and potentially deadly.
The pediatrician informed the Premier that these were victims of raw milk, children who would not be there if the government would act.
“Your government has the power – if it wishes to use it – to empty hospital wards like these,” Dr. Brown whispered.
“Done,” Hepburn is said to have replied.
The result was legislation to make pasteurization mandatory, and a firestorm that threatened to split Hepburn’s caucus and Cabinet.
Even Hepburn’s own riding of Elgin was in revolt. In early 1938, Hepburn entertained a delegation of farmers enthusiastically opposed to pasteurization. They cited the cost, and questioned evidence that untreated milk caused the disease.
According to his biography, Hepburn recognized one of the men demanding he stop pasteurization.
“How many children do you have?”
“I have five,” replied the surprised farmer.
“Didn’t you have seven?”
“Yes, but two died.”
“They died of bovine tuberculosis, didn’t they? They drank milk from your own cows and died?” Hepburn persisted angrily.
“You came here today to protest against the pasteurization of milk. You have already lost two children to bovine tuberculosis, but that doesn’t prevent you from coming here to ask this Government to withdraw its bill and leave your children and other children open to the threat of death. What kind of man are you?”
The opposition didn’t quiet, despite Hepburn’s steel. But the Premier persisted and it became his proudest accomplishment.
“I had to take the hard way, not the popular way,” Hepburn told farmers in his own riding after the bill was passed, “and I am going to live to see the day when the children of Ontario will be safe from the dangers of bovine tuberculosis.”
By 1941, cases of tuberculosis had dropped by 45 per cent, while typhoid was down 50 per cent.
Lives were saved by Hepburn’s courage.
Wednesday, November 4, 2009 02:40 PM
It ain’t about Obama
There are claims that the elections in New Jersey and Virginia show that President Barack Obama has no coattails.
If that is true, then presidents Jimmy Carter, Ronald Reagan, George HW Bush, Bill Clinton and George W Bush were all without coattails as well.
The Commonwealth of Virginia voted for a governor of the opposite party as the President in every election following the election of a new President since 1978.
Similarly, the New Jersey gubernatorial election saw the President’s party lose with George H.W. Bush, Bill Clinton and George W. Bush freshly elected to the White House as well.
Yesterday was the continuation of a trend that is 40 years old in Virginia and 30 years old in New Jersey: the President’s party loses.
And President Obama’s campaigning is hardly the trigger for these losses.
In both New Jersey and Virginia, the Republicans avoiding running against President Obama, choosing to focus on local issues and personalities. Virginia Governor-elect McDonnell went out of his way to praise Obama when the President won the Nobel Prize.
New Jersey Governor Jon Corzine, the former CEO of Goldman Sachs, was an unpopular incumbent in a state that remains quite generally supportive of Obama, giving him a 57 per cent approval rating recently. Corzine trailed his Republican opponent consistently from the beginning of the year, and was suffering from a negative approval rating since February of 2008. It was only when President Obama began campaign vigorously a month ago that the gap began to close.
Similarly, in Virginia, Democrat Creigh Deeds trailed Republican Bob McDonnell in every single poll with the exception of a slight bump when Deeds won the nomination in June. Demographic factors and turnout problems hampered the ability of the Democrats to compete, but they were never really in the running here from the beginning.
Had the Democrats won either of these races, it would have been in the face of decades of history and coming from behind.
As I warned two weeks ago, the national significance of these state-level elections is relatively little.
National issues played in favour of the Democrats in New Jersey, and they lost. National issues ran against the Democrats in Virginia and they lost worse. National issues played a role in the size of the margin of loss, but they don’t explain the losses themselves. Victory or defeat was the result of local factors.
This is not to say Obama doesn’t have problems.
He was oversold in his own election and voters are having buyer’s remorse. The economy is stabilized modestly but unemployment is continuing to climb. The wars in Iraq and Afghanistan both face huge challenges. Failure to secure health reform would leave his party split and moribund.
But the focus should be on the steak in Washington, not the sizzle of state elections.
Wednesday, November 4, 2009 09:22 AM
Ship Money and the HST
We all like to complain about taxes, and consumption taxes have been a popular target of populist bluster, but we Canadians have nothing on 17th century England.
There, ill-conceived taxes were the spark for religious turmoil, civil war and wide-spread misery.
One of the best examples from history is the “Ship Money.”
Charles I of England, Scotland and Ireland was the son of a King who described the job as “little Gods on Earth.”
In contrast, the gentry who made up Parliament were growing more powerful and less supportive of the Divine Right of the King. But Charles needed Parliament to raise taxes. The gentry who made up the elected body were the only effective body for raising taxes; their endorsement was essential to most levies, as well as the stamp required to make new taxes legal.
The King was constantly short on cash, and had to go to Parliament to raise any money above the regular operation of government. Charles’s father had constantly called Parliaments in order to raise him more revenues, and was forced to make multiple concessions before they would vote him supply.
In exchange for raising taxes, Parliament placed pressure on Charles to accept limits on the right of the King to wage war, wed Catholics and pursue the unification of England and Wales with Scotland and Ireland.
A temperamental and stubborn King, Charles dismissed Parliament and did not call another one for 11 years, a period known as “Personal Rule” or the “Eleven Years of Tyranny.”
To finance his government, Charles was forced to bend policy to meet his new fiscal situation.
First, Charles pursued a foreign policy that was resolutely isolationist. War was the most expensive item in his budget, so he stopped doing it. He also avoided any new domestic projects that would require new expenditure.
Second, he squeezed his existing revenue sources for all they were worth.
If Parliament was required to raise a new levy, the King and his advisers decided, then they would simply revive old levies that had fallen into disuse.
Outdated fines for non-attendance of Anglican services were revived, punishing primarily the Puritan dissenters.
Gentleman who had failed to attend the King’s Coronation to receive a knighthood were fined, another revival of a long-dead law.
Most famously, the “ship money” was revived. This was a requirement that coastal towns provide military ships or their cash equivalent to help pay the cost of defending themselves, one that was normally only exercised in times of war.
Despite the peace that was a prerequisite of his cash management strategy, Charles manufactured a threat of pirates and the general situation of unease on the continent to justify levying the tax in peacetime.
Protests ensued and now-famous legal cases were brought forward. In the end, Charles was successful in getting his Ship Money and surviving eleven years without Parliament, but at the cost of general dissatisfaction with his rule.
Wednesday, October 28, 2009 05:29 PM
12-step program for Liberals
Peter Donolo is an outstanding political professional who served prime minister Jean Chrétien with distinction. Outside of the Ottawa, Donolo also enjoys a sterling track record. He was a solid communications advisor to Toronto mayor Art Eggleton and co-chaired an underdog city councilor named David Miller to back-to-back victories at City Hall. He understands polling and strategy, and can turn complex policy into a bumper sticker slogan that moves vote.
Peter will be surefooted with caucus. His advice to me when I was starting in government was to always return MP phone calls first, no matter how much else was on your plate. It was the best advice I ever got. What little success I had as a staffer can be linked back to the “it’s about the elected members” attitude people like Peter instilled.
Sadly, politics is a zero sum game. For everyone who goes up, someone else must go down.
I like Ian Davey and respect him tremendously. At times, I disagreed with him, but never doubted his commitment to country, party and leader.
Ian inspired a sparkling personality to enter to the bloodsport of politics. He managed the campaign of a relative neophyte to a near-win in a race for the leadership of the Liberal Party of Canada in 2006. He helped make Michael Ignatieff the leader in 2008. Those accomplishments are real and lasting, and are a credit to Ian’s vision, intellect and effort.
The last six months have been bruising and chaotic. Someone needed to draw the short-straw. Ian did.
Heaping the blame for the current state of the Liberal Party on any one person (recent beneficiaries include Jean Chrétien, Paul Martin, David Herle, Stéphane Dion and Ian Davey) is hardly honest or productive. The problems are deep and multifaceted. Fixing them requires the understanding that no one person is to blame and no one person is going to fix it.
Ian's departure may have a catalytic impact on the Liberal Party, but only if Liberals understand the problems are not in tactics, or advisors, or who sits in what chair.
The challenges are decades in the making, and the result of cumulative decisions that alienated huge swaths of western, rural and francophone Canada from the Liberal universe.
The solutions are hard.
Tuesday, October 27, 2009 08:13 PM
Facebook education
Competition for scholarships was always fierce, but the Internet age is putting a new spin on an old contest.
Sprott-Shaw Community College is a private career training program in British Columbia, specializing in health care, tourism, business and IT.
Their innovative scholarship – Class Act Canada – offers winners up to $100,000 to cover the full cost of a program, including living expenses.
And the application process is designed for the Facebook age.
Recognizing that motivated applicants will drive up their name recognition, Sprott-Shaw’s contest is based around web-voting and strong encourages applicants to use new media to drive supporters to their website.
Those who made the final 20 applicants last week received an average of more than 100,000 votes each, meaning more than two hundred thousand unique visitors to Sprott-Shaw’s website.
One more round of voting is currently underway and then a panel of judges will decide the ten winners based on their rankings in voting, and the overall quality of their applications.
The exercise is a huge success for Sprott-Shaw, who can expect a big jump in their applications as a result of the social media publicity.
It’s also a great opportunity for some deserving people to change their lives.
My friend Cluny Macpherson is one of the applicants.
He went to school with my brother and I've watched him grow up from a minor niner to a bluegrass musician to a caring father. Cluny's now the father of Hazel and Delia and looking to improve the life he can offer them with an education in practical nursing at Sprott-Shaw.
Obviously, it’s tough to raise two kids while putting yourself through school. Leaping at the opportunity this scholarship provides, Cluny is using social media for enrolling friends to increase his votes at the Sprott-Shaw website.
Tuesday, October 27, 2009 01:09 PM
The best in Canadian blogs
Nominations are now open for the 2009 Canadian Blog Awards .
I’m a big fan of the awards (other than their use of “blog,” a term I object to because it is onomatopoeia for someone blowing their nose.)
They cover the waterfront in online commentary, and recognize some great contributors to the national conversation.
There are a score of categories this year, with everything from GLBT to Crafts & Cooking or Religion & Philosophy.
I’ve made a few nominations myself, a few of which you can see below, and encourage you to do the same.
This Year’s Categories:
Blog Post – Wells’ Rules, Annotated.
Blog Post Series – Perez Hudak, Anonymous, Coverage of the 2009 Ontario PC Leadership Race.
Blog Written By A Journalist – Inside the Queensway, Kady O’Malley, Maclean’s. (She's since moved on to the CBC ).
Political – Calgary Grit Dan Arnold
Monday, October 26, 2009 02:24 PM
Much ado about little
Polls are one thing, but elections are another. Mandates are made and broken when voters cast a ballot, not when they answer a survey.
But - as with polls - there is a temptation to read too much into a relatively small check-up by the electorate.
South of the border, it's election week in the United States.
However, this is an "off-year" so the number of major races is very small. The main action on Nov. 3 sees votes for governors of two states, Virginia and New Jersey.
Both states could see the party in power switch, meaning the Democrats lose. This is likely in Virginia and too close to call for New Jersey.
If the two state-wide offices are lost by the Democrats, there will be much hooting and finger-pointing by the Republicans. The GOP is desperate to show the end is nigh for Barack Obama and another 1994-style landslide in store for Congress next year.
However, the reality is off-year elections tend to have little predictive power for election results.
Since 1978, Virginia has elected a governor of the opposite partisan stripe as the President, every single time. Not once has a President successfully retained Virginia after winning his own election.
New Jersey is a similar, if slightly less direct, negative correlation.
The first elections held under Presidents George H.W. Bush, Bill Clinton and George W. Bush all saw the Governor's mansion change hand. Before that the record is less direct but still saw a similar flip away from the Republicans when Eisenhower became President.
The lesson is simple: don't read too much into off-year elections in the United States.
Closer to home, the Harper government faces four by-elections across the country.
Just like in the U.S., none should be taken as a referendum on the government.
The British Columbia by-election is getting the most attention, with some calling it a referendum on the Harper government's initiation of a harmonized sales tax with the B.C. Liberals.
However, the party attempting to make this an HST referendum is the same party that held the seat, the NDP. This tactic of pretending the maintenance of the status quo is some type of massive repudiation doesn't really hold water. If the NDP vote experienced a massive and inexplicable boost, then perhaps there is some juice in the HST issue. The more likely situation is the opposition is better able to rally its vote when the governing party's supporters aren't worried about who actually runs the country.
Cumberland-Colchester-Musquodoboit Valley is another unique circumstance. Bill Casey's resignation may lend some gas to the opposition, but the ground is stony. This seat has only gone for someone other than a Tory once, in the nightmare year of 1993. Other than that single Liberal MP, the record is unbroken Conservative representation.
Montmagny-L'Islet-Kamouraska-Rivière-du-Loup has been a safe Bloc Quebecois seat since 2004. This is the most Catholic, most French-speaking and most French-as-mother-tounge riding in the country. Hochelaga is a similarly strong Bloc seat, one of its best in Montreal. The seat, and those that it was formed from before the 2004 election, were solid Bloc right back to 1993. In fact, part of the seat includes Laurier-Ste Marie, where Gilles Duceppe first won for the "ad-hoc temporary rainbow coalition."
This is not exactly ground where one expects a true test of public opinion. One seat has changed hands between the Conservatives and NDP recently, while the others are dictionary-definition safe seats.
Basically, it is entirely reasonable to expect nothing to change. And even a shift to the Conservatives in B.C. could mean only a few hundred votes going right instead of left.
As such, any pronounciations of grand impacts on the Harper administration due to maintenance of the status quo are almost definitely overblown.
What will be more telling are the detailed breakdowns of the vote. Who got their vote out and who didn't? What trends were present across the country?
As with so many things, the truth is in the details, not the topline result.
Thursday, October 22, 2009 05:45 PM
Shocking the system
Government is like going to the gym.
If you want results, you have to shock the system.
Today’s economic statement in Ontario is the policy equivalent of 80 alternating lunges.
The deficit is worrisomely high, thanks to the massive stimulus package announced last spring, the auto-sector bailout, collapsing corporate tax revenues and increasing social assistance costs.
Governments at this crossroads face two options: fiddle or transform.
They can take the lazy path of a myriad of infinitesimal cuts across the board, a Chinese water torture of minor tinkering that accomplishes little fiscally and simply angers people.
Or they can revolutionize the way the government works with massive, focused moves.
The Ontario government is clearly preparing for the latter.
The government is lining up to do big things. Very big things.
The priority is education and investments in those things that allow our economy to grow.
Everything else will be measured through three lenses.
1. Does government need to deliver it? If not, outsource it.
2. Can we do it cheaper? If so, make it happen.
3. Does it need to happen? If not, end it.
What does this mean for people in Ontario?
For those working in municipalities, universities, schools or hospitals (the MUSH sector) the only certainly is massive change.
The smart people in the public sector realize they have two options: resist change and get run over, or come up with big ideas to transform themselves and survive.
For those in the private sector, they have faced a similar revolution as Ontario’s economy shifts and people lose their jobs. The government is acting with tax reforms like corporate tax cuts and HST to lower costs and create jobs. Now the public sector will be catching up to the experience of those in private business.
For citizens, the good news is who is undertaking the process.
Dalton McGuinty spent six years stabilizing public services, lowering waiting times and class sizes.
This won’t be Mike Harris bringing an ideological agenda to the delivery of health care and education. McGuinty is going to be focused on protecting and improving services for the public (and agnostic about who delivers them, so long as they are delivered well.)
The phrase that comes to mind is the old chestnut: Only Nixon can go to China.
Richard Nixon was a staunch anti-communist who won his Senate seat in 1950 by labeling Helen Gahagan Douglas as “pink right down to her underwear.”
This history immunized him against attacks from the right when he opened America's diplomatic relations with Communist China in 1972. This taboo issue, long a third-rail of American politics, was one Nixon was uniquely placed to confront.
A similar phenomenon may take place in Ontario. The Liberal McGuinty, who made his name lowering wait times in health care and lowering class sizes in schools, is uniquely placed to transform service delivery to be better and cheaper in the long run.
Only McGuinty can transform public services.
(The Liberals are already bringing on new people to lead the fight. Mary Lowe was announced as the new chief of staff at Health. Mary is an experienced government insider who proved a hard-charger at Infrastructure Ontario, getting projects out the door and delivering on time and on budget.)
There will be a temptation among some observers, cynical and bitter, to ignore the clear message delivered today.
“Pshaw,” they will blurt. “This is the same old rhetoric governments always use and then things go back to business as usual.”
Business as usual is over, victim of a near $25-billion deficit.
The only absolutely certainty is no sensible person is going to be talking much about expensed choco-bites or procurement irregularities after today.
Monday, October 19, 2009 05:02 PM
Safe change
One weekend. Two party leaderships. Nerd heaven.
In Winnipeg, the Manitoba NDP selected Gary Selinger as the new leader and Premier.
In Alberta, the Wildrose Alliance picked Danielle Smith to represent them.
The two leaders have very different challenges in the days ahead, but both are going to try to be "safe change."
For Selinger, the job will be pulling his party together while freshening the brand. In short, he needs to be able to embody "safe change".
The NDP has governed Manitoba for ten years, and done a pretty good job. A lot of the government's popularity were due to Mr. Selinger's policies, and outgoing Premier Gary Doer's personality. Keeping the public's trust while maintaining a centrist path against pressure from the left-wing of his own party will try Mr. Selinger.
Probably his biggest early challenge is paring down the cumbersome two-thirds of the party membership and 100 per cent of the cabinet who backed him into a leaner coalition of core supporters.
Political theory says that the most efficient coalition is exactly what is needed to win a race. Any more, and the spoils of victory are dilluted by the multitude on the winning side. It is this pressure that explains why - despite chaotic factors - so many races come down to a 52-48 finish or some similarly close number.
When politicians run up huge super-majorities, it can be a sign of making too many promises to too many people and making the post-vote winnowing down a harrowing process.
Selinger will need to disappoint some people as he moves forward. Hopefully, he will pick well.
The new Albertan party leader has a different challenge, but needs to embody the same characteristic: "safe change."
In many ways, Danielle Smith is in the catbird seat.
Ed Stelmach is facing a revolt from the oil industry over his royalty review.
His party lost a safe Calgary seat in a by-election, finishing third to the Wildrose Alliance candidate.
Ralph Klein has said if Stelmach gets less than 70 per cent at a leadership review November 7 he must step down.
There are rumours that as many as ten MLAs will switch parties to the Wildrose between today and November 7.
The pressure is on the Premier to deliver a massive victory in his review in Red Deer.
Ms. Smith needs to keep it there.
She won the leadership of her party while espousing socially progressive positions on abortion and gay rights. In an organization thought to be a coalition of libertarians and social conservatives, these are tricky issues to subsume. The less she talks about the details of her own agenda and the more she keeps the spotlight on Stelmach's fumbles the better off she is.
Reporters will want to run "Who is Danielle Smith" biographies for the next several days. By all means, the new leader needs to make an impression, but the key is to present a face attractive to all three major vote blocs in Alberta: Edmonton, Calgary and rural. Do that by contrasting yourself against Premier Stelmach and letting voters fill in the details themselves with what they want to see.
Basically, embody safe change, and let the voters decide what that means for themselves.
Two leaders. Two situations. Both need to present themselves as safe change, and both need to do it in very different ways.
Andrew Steele Contributors
Andrew Steele
Andrew Steele is Senior Consultant at StrategyCorp., Toronto’s elite public affairs firm. He was previously senior advisor to Ontario Premier Dalton McGuinty. He also served as Chief of Staff to the Ontario ministers of Environment, Government Services and Management Board. Described by the National Post as a "hard-nosed political veteran," Andrew has played a role in more than 25 closely-fought campaigns in Ontario, British Columbia, the United States, and on the municipal and federal scene in Canada. In the private sector, Andrew designed and analyzed public opinion surveys and interpreted focus groups at one of Canada's top market research companies.