There is a quiet debate under way within the Conservative caucus. While not everyone – perhaps not even a majority – agrees, senior figures within the caucus are convinced the party’s future hinges on the outcome of that debate, and they believe Stephen Harper shares their concern.
Some Conservatives are asking themselves whether the party is in danger of losing the middle class.
Suburban middle-class voters in Ontario are the bedrock of this majority government. In each election since 2004, more and more of them have abandoned the Liberal Party and switched to the Conservative Party, because they believe that Mr. Harper understands them and governs in their interest.
The Conservatives think that these middle-class workers don’t want ambitious national programs, state-sponsored support, affirmative this or subsidized that. They just want jobs.
So the government keeps taxes low, regulations few and budgets as balanced as possible. This encourages businesses to create and preserve jobs, and the people in those jobs in turn vote Conservative.
But the contract is fraying. People who wouldn’t be caught dead at an Occupy encampment still wonder why the rich are so very rich, even though the companies they run close factories and move operations overseas.
Unemployment is too high and growth too low, mostly because the United States and other developed nations are in even worse shape, weakening Canadian exports.
And the Tories are increasingly worried about NDP Leader Thomas Mulcair. They see him as the toughest and most able leader they have faced.
Mr. Mulcair has a message for those middle-class voters: Make corporations and the richest Canadians pay more. Focus on the manufacturing sector rather than promoting natural resource exports. Instead of relying on laissez-faire, push the federal government into the economy through increased regulation and targeted investments.
As federal politics evolves from amorphous debates over national values into a simple clash over how best to manage the economy, Mr. Mulcair could be emerging as the most compelling champion of a progressive alternative to conservative orthodoxy in many years.
The Conservatives, of course, believe that the NDP prescription is profoundly wrong, that it would suppress growth and increase unemployment. But they are worried a more activist approach to government may appeal to a stressed-out middle class, especially because some of what the NDP says makes sense.
After all, Mr. Harper’s government massively intervened in the auto sector to rescue GM and Chrysler. Mr. Harper’s government protected the potash industry from foreign takeover. Mr. Harper’s government continues to subsidize key industrial sectors, such as aerospace, because other countries are subsidizing theirs.
Beyond that, how can any government preserve middle-class expectations that things will get better for them and their children when the economy is bifurcating into an elite with very high skills and very high pay, and a broader population that struggles to find work and keep it?
How do you run an economy gripped by both labour shortages and high unemployment, with too few workers qualified for the jobs that exist and too many qualified for jobs that don’t?
The Harper government has some answers to those questions. Immigration and employment insurance policies are being revamped to match immigrants to available jobs, and to force unemployed workers to take work or move to where work can be found.
Free trade talks under way with European and Asian countries aim to stimulate manufacturing as well as natural resource industries. And as Third World wages rise and oil scarcity pushes up shipping costs, there are early and tentative signs that Tory low-tax policies are encouraging manufacturing jobs to come back home.
Some Conservatives argue that keeping the middle class onside means staying the course: even fewer and simpler regulations, even less government spending, even lower taxes once the books are balanced.
Others aren’t sure it’s enough. They have more questions than answers. But they believe their party and its leadership need to face those questions squarely.
And they insist that Mr. Harper, though he’d never say it in public, agrees.