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Prime Minister Stephen Harper has spent the last year balancing the budget in preparation for an expected 2015 election campaign, a fight which Canada's sixth longest-serving prime minster is already waging by announcing massive tax cuts for families. He's condemned Russia for invading Ukraine and annexing Crimea, sent Canadians on a new combat mission to Iraq and accused the Chinese of hacking into government computers just months before he made a much-watched journey to Beijing. A former Conservative MP, who has since resigned, has been convicted of election act breaches and two Conservative Senate appointees face charges related to their expenses.

Mr. Harper's message to voters is that only he can be trusted to helm the Canadian government right now, with the balanced budget and resulting tax cuts the evidence he points to as proof he's getting the job done.

Mr. Harper sat down with The Globe and Mail's Steven Chase for a wide-ranging interview on Dec. 15 in Ottawa.

You're now the sixth longest-serving prime minister in Canada. You are in your ninth year in office and if you win the next election you will become the fifth longest-serving prime minister. You have served longer than [many] of our leaders. You've passed Mr. Mulroney, Mr. Diefenbaker, and Mr. Pearson. I'd like to know why you still want to be prime minister, to put yourself through another punishing election [campaign]. What is it you think that only you can do as leader – that you need to stay on?

I've always said the job is a great honour. It's the best job in the best country in the world. Overall, I still enjoy it. I still look forward to coming to work every day. And we think the country is on the right track, a good track, particularly economically. We continue to have a relatively strong economy. I say relatively, compared to most other places in the world. A relatively secure future. But obviously we're landing a balanced budget, expanding our trade networks. There's a bunch of things that we're doing that are important, that are not yet done and I'd like to keep working on them. I think our read is the country appreciates the track it's on and wants to stay on that track. So that's what I am committed to doing for the next few years.

Any particular projects you think require your attention in the next mandate?

Essentially what we want to do is consolidate the gains we've made as a country over the past few years. You know: we were, a decade-plus ago, we were at best in the middle of the pack when global times were pretty good. Now we've been through challenging times and we have come out of that leading the pack. And I believe the new approach we've taken has a lot to do with that. Expanding our markets, making sure we have a good fiscal framework, that we're able to lower taxes, bring benefits directly to people. The kind of family benefits we're able to deliver. And I think it would be too risky in the short term to let that direction be changed and undo what we've done. I think we need a bit more time to make sure that the gains we're seeing in our economy are truly long term and sustainable.

Can I ask you about oil prices and the economy? Oil's trading below $60 a barrel [U.S.] and we've got the oil patch talking about layoffs and slowing its investment. You've got the governor of the Bank of Canada estimating the housing market is overvalued by 10 to 30 per cent. We're going into an election year and your government has built its credentials on sound economic management and providing tax cuts. Now we've got high consumer debt at the same time, so that's a lot on the plate. What does this mean for Canada and will you cut spending in the budget if necessary to keep it balanced?

I think the numbers are clear: We're going to reach a balanced budget this year. Notwithstanding some fluctuations in commodity prices, which are going to make things a bit tight. The government's well within range of balancing the budget. So that's not a serious problem. If that were a problem we would not have moved forward with benefits and tax reductions for families, with major new investments in infrastructure and innovation and research. But look, what I would say to those things, I don't want to minimize them. There is two things in front of us. Our economy has continued to perform relatively well compared to others but we are in a global economy where there are many challenges including commodity price fluctuations and other things that are beyond our control. But our view is with good, solid experienced management the country can more than survive these things; it can prosper.

But obviously now is not the time to rest on our laurels or to pretend that we can go on a binge of tax hikes and huge deficits and increases in debt and a bunch of experiments that we can't afford.

You were the first prime minister to stand up in the Commons and apologize for Indian residential schools. You endorsed the UN Declaration on the Rights of Indigenous People and extend the Canadian Human Rights Act to cover aboriginals on reserves. You passed a law enshrining matrimonial property rights on reserves. People can look at your record. A lot there …

And the first to get with the Assembly of First Nations a comprehensive deal on the reform of the [aboriginal] education system, which unfortunately they decided not to proceed with. But [it's] something that still needs to be done.

And you've also at the same time been adamantly opposed to a national inquiry into these 1,100 murdered or missing aboriginal women since 1980. Can you elaborate? You talked about sociology. Can you elaborate and just explain in light of the continued requests for it – as recently as the new AFN chief – can you elaborate on why this [inquiry] would be such a bad idea? And maybe in doing so can you explain the philosophy that guides you on decisions affecting Canada's aboriginal people?

What we've tried to do in so many areas – and aboriginal policy is no different – is we've tried to make continual, incremental progress and I think we have on a lot of important aboriginal policy issues, including issues of violence and the deprivation of the rights and status of women and girls in those communities. We have dozens of reports on this phenomenon, including pretty comprehensive reports from the RCMP and others on the nature of the crimes involved. Our view is that now is the time to take action. We've been taking action on a series of fronts: some of the things you've mentioned, to enhance the status of women and girls. Obviously some pretty important actions in the criminal justice area so that we're able to fight this kind of crime, which as you know has generally been declining in Canada under our watch.

Crimes against women? Or?

Violent crime generally has been declining. So look, we're open to any set of actions and that's what we will continue to move forward on.

But a commission would just be what?

It would be another study. It would be in place of action.

I wanted to ask you about Vladimir Putin and your dealings with him this year. These aren't topics that normally dominate federal elections. You've made Russia's aggression in Ukraine and its annexation of Crimea a major issue for your government. You spent significant effort in criticizing Mr. Putin and discrediting him. Our population is about No. 37 in the world in terms of size. We are very limited in our ability to engage militarily, despite everything that has been done. What does it benefit Canada to take such a hard line against Mr. Putin, to rebuke him for instance at the G20, which was a major story there. And what are the consequences for Canada?

First of all, Canadians are not like Americans. We've never had bouts of isolationism in our history. Canadians for reasons that are unique to this country [are] very different than the United States, in spite of our distance from so many other places. We've always understood that our prosperity and our security in the world is in fact influenced by events a long way from our shores. And that the promotion of our interests and values around the world – and working with allies to do that, is pretty important in terms of where this country is going to be in the long term.

I think Canadians have always understood that. As you know we have brought in a different approach to foreign affairs from previous governments, previous Liberal governments who, we … unflatteringly described it as 'go along to get along'. Whatever the consensus is, just sign on to it. We have taken stronger stands when we view that important issues, important interests and important values, are at stake.

Couple of those areas have been our concerns from the fairly early days of this government on the increasing aggressiveness of the Putin regime. And another has been not just the stance defending Israel but frankly an understanding of the risks that radical jihad presents not just to Israel but to all of us who share Israel's place in the world of democratic nations. So I think that frankly, people have understood that we have actually been ahead of the curve on these things, [on] understanding the very real threats and risks that they pose.

Look, in the case of Mr. Putin. I think when a major power … I think when any power tries to redraw boundaries by force – this has not happened with any frequency in the post-war era. It's one of the bases of world peace that we've had since 1945.

When a major power does that to a neighbour in Europe, I think this is an act of enormous import. And I think, as you say, there is only so much we can do about that. The minimum we can do is simply say we don't agree with it.

Frankly, it's not very difficult for me to tell Mr. Putin to his face that I don't agree with his actions.

I am not sure what else it is I would have said to him [in Brisbane].

What else am I supposed to say?

'How about those Capitals? How about those Leafs?' I mean, seriously.

This is a move of enormous global destabilization. Our allies have actually responded pretty significantly, particularly in terms of sanctions. And you can see it's having a real impact on Russia. So look, I think we were a bit ahead of the curve on this but I don't think we've done anything that requires anything other than a little bit of conviction.

You traveled to China last month. It was your third trip. It's a complicated relationship; that's for sure. And over the years the media and you have batted back and forth a variety of questions. But one question that remains in my mind is the issue of mixed signals with China.

The federal government for instance has discouraged telecom and networking countries from using Huawei technology – for what it says are very good reasons. It's made it clear it won't let Lenovo buy Blackberry. And it's warned Beijing ... in December 2012 that you won't accept any more state-owned investment in the oil sands. You've made it clear there are areas [where] you do not want to see Chinese investment. At the same time you signed the foreign investment protection deal [with China]. You've made the effort to go to China and to meet them halfway ... How do the Chinese react when you close off investment routes and how do you encourage a closer relationship when Canada is so selective about what we want from Beijing?

First of all, let's be clear what the government's objective is. These are not mixed signals, as you put it. They are carefully calibrated decisions with an objective in mind. Let me be absolutely clear: the objective is not to have the best possible relationship we can have with China in terms of getting along.

The policy of our government is not to go along to get along. And the more we get along, the better the relationship is.

Our policy is not just to get along as well as possible. Our policy is to have the best relationship that is in Canadians' interests.

That means parts of this relationship that serve our interests, and frankly serve mutual interests between Canada and China, we are trying to develop. Whereas when we're faced with issues that we think may be in the Chinese interest but frankly not in the interest of this country, we calibrate accordingly.

Take the issue of investment. You and some others will talk about restrictions on Chinese investment. The fact of the matter is Chinese investment is far greater in Canada, and far freer in Canada, than Canadian investment in China. That is just a fact. And it's not close.

And our goal is to that make sure that we are enhancing a balanced relationship that is, as the Chinese like to say, win-win.

Some of the things you've mentioned we're not pursuing because they are frankly not in Canada's interests. And Canada's interests with China are complex because on the one hand: obviously [they're] a big economic player and very often, I think we also have to say, even though we don't always agree with their actions, very often a force of stability, certainly a force of caution in world affairs.

At the same time, we know that on a level of values, democratic values, on a level of security threats and interests, there are some very real challenges in this relationship.

And those challenges cannot just be pretended away.

And I think the Chinese frankly. I think the Chinese frankly, and you know it's hard to speak for the other guy, but I think far from being bewildered and seeing mixed signals by this, I think they get it fully and I think they respect us a lot more for standing up for ourselves in this relationship.

As I said, it's complicated and so there are a lot of contradictory thoughts one has when one considers the issue. You wonder sometimes if it's worth it. You look at our top exports to China: slag metal, wood pulp, grains and oilseeds. Are we getting enough out of this relationship?

Um. We would like to get more out of it. It's a growing relationship. And it is a growing relationship on both sides and frankly the growth on both sides has been more even than it was the past. So I think we are getting more out of it. But that's our objective. Our objective is to make sure – which was clearly not the case when we came to office. When we came to office, over 80 per cent of the trade was the Chinese way [was imports from China]. Over 80 per cent. There were no efforts whatsoever to assert our interests in this relationship.

So, look, it's a delicate relationship.

But we've done this before, right? We have a relationship with the United States.

Now obviously on the level of values and security and the nature of the economy, we are a lot similar.

But our whole country's history is surviving and thriving as a unique country beside a giant. So if we can do it besides the United States, I think we can do it with China.

So we have to go in with eyes wide open, and we have to stand up for ourselves.

And it always amuses me that some of the people who would criticize us for standing up [to] China would demand that we pick fights with the United States for no reason whatsoever.

Our objective is Canadian interests, but in an enlightened way.

We expect that in a relationship the interests have to work both ways.

But we clearly have to be leery and we have seen in the past with the relationship with China and some other relationships where the interests were all one way.

How much can we trust them? Do we haver to assume they're still trying to break into our government computers?

Security experts will tell you these issues are very real and that's why we take those into account in some of the decisions we take.

Your party came to power promising a new era in political ethics after what you called the Liberal government's preoccupation with scandal and damage control. But you have accumulated a record. Dean Del Mastro's election law breaches. Michael Sona's robocalls conviction, influence peddling charges for Bruce Carson and course the charges against Mr. Brazeau and Mike Duffy, whose trial probably takes place next spring. Is this a sign you've been in power too long?

No, not at all. Look, I think given the length of time we've been in power, these … I am not trying to make excuses. We don't want these things to happen. But they are pretty small and they are almost all about individuals and about individuals doing things wrong. And in some cases, like the Carson example you mentioned, frankly [has] nothing to do with the government of Canada itself. We have put in place very strict rules. We have enforced those rules when there have been violations. We have enforced those rules. And the consequence is that Canadians can be very sure, and I can be very sure, that I have a government of people who, whether you may agree with them or not, who are coming into the office every day, particularly our ministers, and running their departments with the public interest in mind and not lining their pockets personally. And I don't think anybody thinks that about this government.


I could elaborate ... Canadians can look around the world. They can look around this country and see the difference of not just things in their own lives, job creation, home ownership, etc. They can see a government that is balancing the budget, delivering increased payments, services, tax cuts into their pockets, versus a lot of other places where governments are in a mess, governments are cutting services, and governments are raising taxes. And frankly [where] the economy has shown no growth in years and shows no growth for years to come. That's the big difference.

There's a very important point of policy difference between you and Mr. Trudeau. We have a windfall surplus based on the restraint efforts you've made over the last few years. You have taken this and given this back to people [in tax cuts]. Mr. Trudeau's approach is quite different. He says he would repeal some of these things and spend money on infrastructure, on innovation and research. There seems to be a philosophical difference about how we spend surplus money.

I think the difference is more profound than that. Mr. Trudeau's promises don't add up. He will spend money and accumulate debt and raise people's taxes. That's the difference. He won't just spend the money differently. The promises that he has made cannot be realistically financed other than by accumulating debt, raising taxes and frankly, driving the economy and people's personal finances into the same ditch that we see in so many other places around the world and frankly in some other governments within this country.

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