HARPER GOVT ON THE DEFENSIVE

How the haughty have fallen.

Just last autumn, Canada's minority Conservative government felt it could do no wrong. Polls showed the Harper government held a healthy lead over a leaderless and demoralized Liberal Party. Canadians appeared to be viewing leader Stephen Harper as a credible, trusted leader for the first time. And a majority government appeared to be in the haughty Harperites' grasp.

And it was in such a heady political environment that the Harper Conservatives decided to roll the political dice and break a popular electoral promise to Canada's seniors' not to tax income trusts.

Influenced by the strident calls of Canada's Establishment newspaper of record, the Globe & Mail -- and various self-interested special-interest groups -- Finance Minister hastily unveiled a destructive new income-trust tax policy that was clearly not ready for prime time.

Nevertheless, despite an avalanche of credible evidence that the blundering Finance Minister had been misled by misinformation supplied by his bureaucrats and Bay Street banking buddies, the Harperites decided to forge ahead -- confident that the Conservative's heady poll numbers and popularity would nullify any loss of votes, political donations and election volunteers from the seniors and other investors hurt by this impetuous new trust tax proposal.

My, how things change. Canada's miscalculating Machievellians now find their backs to the electoral wall. And unless they can show a bit of humility and flexibility, on the issue of income trusts, electoral defeat looks like a near certainty for the Conservatives this spring.

How bad have things gotten politically for the gang that couldn't shoot straight, enviromentally and otherwise? Please read the following Toronto Star analysis below, and then ponder the question of whether their electoral prospects will be even worse once seniors and other disillusioned income-trust investors jump onboard the 'Anybody But Harper' express and take their electoral revenge (not to mention the drop-off in individual political donations to the Conservative Party because of Little Jimmy's mishandling of the income-trust issue).

Most important, why wouldn't Mr. Harper consider a bit of flexibility and compassion on this issue, to at least give him a fighting chance in the next election?

Check out the Toronto Star analysis of the Conservatives' potential electoral woes below, and ponder the question of whether Jim Flaherty and Stephen Harper really are Canada's latest incarnation of Dumb and Dumber?

OH, HOW THINGS CHANGE

Les Whittington and Allan Woods
Ottawa Bureau
Toronto Star
January 20, 2007

OTTAWA – Stephen Harper, who flew to Victoria this week to personally take part in the Conservatives' bid to play the "green" card they discarded months ago, is struggling to find a way to appeal to the mainstream as his reckoning with voters draws ever nearer.

A year ago, in the aftermath of an election that ended 13 years of Liberal power, it seemed the newly chosen prime minister and his band of Conservative MPs had nowhere to go but up.

"Tonight, friends, our great country has voted for change," a beaming Harper told supporters in Calgary on Jan 23. "We will honour your trust and we will deliver on our commitments."

It was a heady time for the Conservatives. Paul Martin, his government mortally wounded by Liberal scandals, was out after fizzling in the prime minister's job. And as the Tories got down to work, Canadians seemed impressed with Harper's activist agenda and the targeted tax cuts in Finance Minister Jim Flaherty's sure-footed first budget. By May, many Liberals were talking dispiritedly about five or six years in the political wilderness.

But Harper's upward trajectory was short-lived. And now the government faces a shifting political landscape that is forcing it to redefine its priorities and adjust to pockets of adverse regional reaction that threaten to undercut its game plan for re-election.

As Canadians' concerns have evolved, Harper finds himself fighting to keep the public onside in a bloody conflict in Afghanistan and overcome a glaring failure to anticipate the emergence of the environment as an overriding national issue. As well, the government has been weighed down by controversies over Middle East policy, accusations of a Mike Harris-like tendency to slash social programs and investor anger from the stunning reversal of the Conservative promise not to tamper with income trusts.

Also, the political picture has been greatly altered by a decline in public disgust over the sponsorship scandal, particularly in Quebec, says pollster Frank Graves.

"It's striking how rapidly that's receded and how quickly the issues have shifted to things that are not particularly favouring the Conservatives" such as Afghanistan and the environment, says Graves, president of EKOS Research.

Although the timing of the minority government's defeat in Parliament – and the next election – remain up in the air, the opposition parties are circling for the kill at the most opportune moment to capitalize on the Conservatives' inability to consolidate their strategic advantage.
Invigorated by a scalding-hot leadership contest and newly united under Stéphane Dion, the Liberals are readying for a wide-open election in which they appear likely – according to recent polls – to leave the starting gate at least neck-and-neck with the federal Tories.

Now in full election campaign mode, Harper is trying to airbrush his party's right-wing image and position the Conservatives closer to the centre of the ideological spectrum.

He shuffled Vic Toews, his law-and-order justice minister, out of that high-profile ministry and into the quiet pastures of Treasury Board. Harper also replaced Environment Minister Rona Ambrose, who shouldered the blame for the Conservatives' disastrous handling of the climate change file, with hard-charging John Baird.

As he took on his new post, Baird denied that the Conservatives had totally miscalculated on the environment.

"I think Canadians had a very different set of priorities a year ago," he said this week. "They wanted Canada's new government to come to Ottawa and clean up the ethical mess that the Liberal party left us ... People wanted tax cuts, people wanted child-care programs that are universal for every child in the country.

"Now they've got those and it's natural that they're going to look at new priorities."

But Daniel Bernier, Ambrose's chief of staff in the environment portfolio, says the Tories were not prepared for the explosion of environmental concerns.

"The file evolved rapidly, very rapidly," Bernier says. "When the Tories were elected – look at the priorities – it wasn't there at all. We had discussions about whether we should try to make it a sixth priority..."
Ultimately, the environment did not make Harper's top five issues for action last January, and the government's Clean Air Act was condemned both at home and abroad at a time when Canada, as head of the United Nations Framework Convention on Climate Change, was supposed to be a leader.

Harper has acknowledged it will be a challenge for the Tories to bounce back from their failure to draw up a credible environmental policy. "We don't think that just a communications change will change anything," he has said.

The Prime Minister is putting his own prestige on the line in this recovery effort, personally announcing a $1.5-billion commitment to long-term development of wind power and other renewable energy sources in Victoria yesterday.

It is one of a number of Liberal approaches to climate change – also including clean energy research and conservation incentives for homes – that the Conservatives had killed but are now reviving in an effort to throw a "green" cloak over their government.

"Now, they reiterate (these programs) and pretend it's fresh and new," Dion says.

Retreading Liberal initiatives appears increasingly common as the Harper government courts mainstream voters.

Battered by charges they were neglecting vital relations with economic superpower China, Flaherty and Trade Minister David Emerson, a former member of the Martin cabinet, mounted the kind of trip to Beijing to promote business and commerce that the Liberals once championed.

And the Tories' child-care policy may end up with more resemblance to the Liberal program they rejected as the government tries to cope with businesses' total lack of interest in Harper's offer of a $10,000 tax credit for each daycare space created by the private sector.

Over the past year, both the staying power of the Tories' policies and their political acumen has been put to the test.

Last January, the election of a prime minister from a western riding was seen as a breakthrough for the Conservatives. "The West is now in," Harper famously declared after the votes were counted.

But his government's quest for additional support, particularly in eastern Canada, is starting to expose vulnerabilities on the party's western flank.
It is not a major threat at the moment, but the creation of the Party of Alberta in November – a sort of Bloc Québécois for the oil-rich province – speaks to a frustration that some Tory MPs, and the odd cabinet minister, only whisper about.

It is the slow progress and outright reversals on things like Senate reform, the effect of the income trust tax decision on the development of certain oil sands firms, and the decision to recognize the Québécois as a "nation" that have shaken people's faith in the Tories, says Rhys Courtman, the 26-year-old founder of the fledgling Party of Alberta.
Long-time conservative supporters have discovered that the firm vows made by Harper and by the Conservatives' predecessor parties are no fait accompli now that the party is in power.

"The process which led to the founding of the Conservative party ... along the way something was lost that was important to Albertans," Courtman says.

And Harper's major federal-provincial gambit, his attempt to overhaul the national system of revenue-sharing to address provincial complaints, is in danger of inflaming western resentment if it's seen as mainly a sop to Quebec. The Saskatchewan government is already up in arms over Ottawa's handling of this file.

The changes that have come about in the last year have also registered abroad, which is where the Tory shift is most pronounced.

At times, Harper's performance seemed like the bumbling of an uncoordinated child trying to hog the ball through a schoolyard game. In contrast to Jean Chrétien golfing with Bill Clinton and Martin dancing with Bono, Harper had barely seen the world outside of the U.S. and a Mexican resort town.

He wore a fishing vest on his first outing with his U.S. and Mexican counterparts and sipped root beer in Kandahar.

But more troubling for some is the government's puffed-up policies on human rights in China and Harper's hawkish forays into Middle East diplomacy.

Harper made Canada the first country in the world to freeze funding to the Palestinians after the election victory by Hamas, which Canada had years previously designated as a terrorist group.

He also raised eyebrows by praising Israel's "measured" response to the kidnapping of an Israeli soldier by Hezbollah in Lebanon last summer, which was the spark for a month-long war.

The Liberals criticized the Prime Minister's judgment, but Canada's Jewish community opened their arms to him. Then Harper attacked what he said were anti-Israel positions taken by "virtually all" of the Liberal leadership candidates. The Liberals roundly denounced him.
Paul Heinbecker, a former Canadian ambassador to the United Nations, says the Tories have demonstrated both too little experience and too much certitude on the world stage.

"I would have thought that the job of a Canadian prime minister was to be pro-Canadian," he says.

"It doesn't make sense to pick sides because, from time to time, both sides have been offside with international law."

Canada's foreign policy shift has not gone unnoticed, either. The European Union has criticized the government for abandoning the Kyoto environment treaty, and in October Amre Moussa, secretary general of the Arab League and a former Egyptian foreign minister, lashed out at "a policy based on total and full bias to one party" – Israel. He warned that such an approach by Canada would do "nothing but damage that country's diplomacy."

But Heinbecker says the government's "balance sheet" on foreign affairs is not entirely negative.

Despite major missteps touting the military commitment to Afghanistan, including rushing into a two-year extension of the mission, Canada has earned the respect of its neighbours and allies by taking a stand against the Taliban.

Looking back, it's clear that Canada's political agenda has changed considerably since the night Harper was chosen by the voters nearly a year ago.

The next few months will reveal whether the Prime Minister – and his rivals in the Liberal, New Democrat, Green and BQ parties – will sink or swim in these unpredictable cross-currents.