The priorities and planning committee of cabinet—Stephen Harper in the chair, Marjory LeBreton vice-chair, with members including ministers Jim Flaherty, Peter MacKay, Tony Clement, Jason Kenney, John Baird and Diane Finley—met at the Willson House conference centre at Meech Lake on Jan. 20 and 21.
Several other ministers were brought in to join what was, for this cabinet, an unusually detailed and freewheeling conversation. Agenda topics included energy, trade, and the report on subsidies for industrial innovation that Open Text chairman Tom Jenkins handed to the government last October. All of those items made it into the Prime Minister’s speech at Davos five days after the committee retreat ended.
Harper’s vague mention of changes to public pensions will get most of the attention. But I was struck by a few paragraphs higher up in the speech. The part where he lectures his peers—or, more gently, shares lessons learned—on the virtues of a virtuous government.
“As I look around the world, as I look particularly at developed countries, I ask whether the creation of economic growth, and therefore jobs, really is the No. 1 policy priority everywhere,” he said, after assuring the crowd that growth and job creation are “our No. 1 priority as a government.”
“Or is it the case that in the developed world, too many of us have, in fact, become complacent about our prosperity? Taking our wealth as a given. Assuming it is somehow the natural order of things. Leaving us instead to focus primarily on our services and entitlements.”
This passage should be read as thinly veiled autobiography and confession. This week a former senior public servant told me that when the Conservatives came to power in 2006, they inherited structural surpluses, booming oil prices and shrinking public debt, and they acted the way trust-fund kids do. “These were like kids in a candy store who had all this allowance. ‘Wow, we can do all this stuff?’ ”
But don’t take my nameless source’s name for it. Take Jim Flaherty’s. His first budget speech, in 2006, carried the title “Focusing on Priorities.” And what did he describe as priorities? In order: “Providing immediate and substantial tax relief,” he said. “Encouraging the skilled trades.” “Families and communities.” “Investing in infrastructure.” “Security.” “Accountability.” “Expenditure management.” “Restoring fiscal balance for our Canadian federation.” And right down there at the bottom, “prosperity.” So you can’t say it wasn’t the No. 1 priority. It’s right there in ninth place.
In Flaherty’s 2007 budget speech, the word “growth” appeared once.
But sometimes the world changes and the trust fund goes bust. For Harper, that happened in the first week of December 2008, when he had to fight like a street gang to keep the job he thought he’d just been re-elected to. So much changed after that. He won in 2011 by running on the economy after years of running away from it. And now here he was in Davos to tell everyone about “the good, growth-oriented policies. The right, often tough choices.”
Blanket news coverage is quickly making the list familiar. Curbing the cost of pensions because an aging population makes those programs expensive. Seeking better return for investment on industrial innovation. Exporting energy resources to Asia. Making “our economic and labour force needs the central goal of our immigration efforts in the future.”
It was all so uncannily familiar.
On Sept. 20, 2005, then-prime minister Paul Martin corralled hundreds of senior bureaucrats at the Canadian Museum of Civilization across the river from Ottawa. He needed to explain why his government, battered by inherited scandal and a hard-earned reputation for indecision, deserved to survive.
There were “new forces” at work in the world, Martin said. “One is the changing demographics of the Canadian population; the other, the stunning rise of China and India.” How to respond? “Canada needs more immigrants, plain and simple, and we need them to succeed.” So he would “be more active in recruiting immigrants” who met needs “identified in consultation with provinces [and] business.”
Canada must develop “other options” besides the American market. “With a rising Asia,” the possibilities were obvious. What could Canada sell the Chinese, anyway? “Canada’s energy and mineral endowment is one of our greatest comparative advantages.”
Selling oil is one way to increase prosperity, but there must be others. Innovation perhaps? “We need robust private sector investment,” Martin said, foreshadowing the Jenkins report—which wasn’t rocket science—by six years. “This is the primary vehicle by which technological innovation enters the economy.”
The whole point of selecting immigrants for the job market, selling oil to Communists, and getting Canadian industry to finally pick up its game is, of course, to help pay for social programs. Which ones? Martin, like Harper, was reluctant to go into detail before an election. But he did allow as how there would be “strain enough to cope with the costs of an aging society.” Today’s Old-Age Security debate was hiding under that fig leaf.
Harper won the battle that followed, and spent two years reallocating the services and entitlements of the Canadian federal state. But he has come to realize that whatever future Canadian voters get, they will thank or blame him for it. A stubborn cliché in politics holds that a majority government has only a year to do anything controversial, before it must worry about re-election. But Harper gets elected on controversy. He views the current window differently: he must behave responsibly now, before anyone notices.
Friday, February 3, 2012