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John Ibbitson: On jets and takeovers, government shows incoherence

The Conservatives are in power for one simple reason: They maintain that protecting the economy is the only issue that matters, and that they do a good job of protecting it. Which is why Friday was such a difficult day for this government.

On two disparate files – acquiring a new jet fighter for the air force, and allowing foreign state-owned firms to acquire Canadian assets – the Harper government displayed an embarrassing level of policy incoherence.

Lucky for them that, at this moment, neither the NDP nor the Liberals are seen by most voters as capable of doing a better job. If either were, those voters might be counting the days until they can throw the bums out.

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Protecting the economy means more than keeping taxes low and regulations few. It also means displaying sound judgment in managing government revenues, and keeping Canada open to investments that will create jobs and growth. On both fronts, this was not a good week for the Prime Minister.

For years, the Tories had been insisting that the Lockheed-Martin F-35 was the only stealth fighter that met the military's needs. The contract would ensure lucrative work for Canadian aerospace firms. Costs were in line with resources. Critics – including the Parliamentary Budget Officer and Alan Williams, a former senior government official who insisted the contract should be opened up for public bidding – were dismissed as uninformed and unpatriotic.

In October, 2010, Mr. Harper angrily declared that critics of the F-35 were "playing politics with the lives of our men and women in uniform … and we will not stand for it."

Actually, he has stood for it.

With estimates now pushing beyond $40-billion over the lifespan of the aircraft, the Conservatives are reportedly ready to review their commitment to purchase the F-35.

Word of the government's second thoughts came even as the Prime Minister was announcing approval of the sale of Nexen, the Canadian energy company, to the Chinese state-owned firm CNOOC.

The Harper government's relations with the Middle Kingdom have pivoted from near-hostility to active courting to, in the CNOOC acquisition, reluctant acquiescence.

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The Chinese say they're delighted with the decision.

"We welcome the decision on the CNOOC-Nexen transaction by the Canadian Government," the embassy declared Saturday on its website.

"This is a market-driven win-win cooperation based on mutual benefits, which we believe will surely bring tangible benefits to both companies and peoples of our two countries."

Maybe, but don't expect it to happen again soon, Mr. Harper warned Friday. The government will approve the sale of oil sands companies to foreign state-owned enterprises, he said, "only in an exceptional circumstance."

What might that circumstance be? We'll find out if the Chinese decide to go after another company.

The Harper government's decision on CNOOC-Nexen is actually a sound one: Any intelligent government will give itself the discretion to reject or accept a proposed major foreign investment, based on the circumstances surrounding that proposal.

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But the delays, equivocations and reversals surrounding the bid – and a smaller bid by the Malaysian state-owned firm Petronas to buy Calgary-based Progress Energy Resources – has left foreign analysts and investors confused and perplexed.

The only good news for the Conservatives is that there is no reason to believe either of the opposition parties would have done a better job.

Canada needs a new, next-generation stealth fighter. Countries around the world are struggling over whether to stick with the F-35 or abandon the commitment.

NDP Leader Thomas Mulcair's determination to tax oil sands companies for environmental purposes, and his "grave concerns" over the CNOOC-Nexen deal, will hardly inspire confidence in the NDP's commitment to promote economic growth and foreign trade.

And while leadership candidate Justin Trudeau came out in favour of the CNOOC-Nexen deal, the Liberals are far from able at this point to credibly claim that they would make better stewards of the economy than the Conservatives.

But the Conservatives have made themselves vulnerable. They have mishandled two major files.

Some day, somebody is going to make them pay a price for that sort of behaviour.

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About the Author

John Ibbitson started at The Globe in 1999 and has been Queen's Park columnist and Ottawa political affairs correspondent.Most recently, he was a correspondent and columnist in Washington, where he wrote Open and Shut: Why America has Barack Obama and Canada has Stephen Harper. He returned to Ottawa as bureau chief in 2009. More


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