Infertile Ground

This week, the Conservative government in Ottawa nixed a $39 Billion takeover bid of Potash Corp by Australia-based BHP Billiton. Industry Minister Tony Clement broke his rhythm as he read a prepared statement in the foyer of the House of Commons reading his “Canada’s open for business” preamble and then taking a deep breath and then delivering his verdict against foreign investment.

Economically, this shook the faith of fiscal conservatives. The Investment Canada Act mandates compulsory review of such foreign takeovers when they exceed $299 million in assets exchanged. But as fiscal conservatives can we be surprised when our ideas don’t sprout when they have not taken root?

The blocking of the potash takeover put to shame our principle of free investment and our global reputation of being open to business. By the time Clement had finished speaking, it was front-page news on the Wall Street Journal’s site. The blackberries of Ottawa-based consultant lobbyists buzzed with bewilderment from clients in Frankfurt. However, this wasn’t a decision made in the broadest political context of global economic stimulus, it was one made in the more raw and narrow context of saving 13 Conservative seats in Saskatchewan. And by doing so, acting wholly unconservative.

Politically it was the right move, but it should not have been. More votes were saved in Saskatchewan this week than were lost on Bay street. Yet as with the stimulus, for Conservatives both in name and in principle, it ripped at our guts and gave us great pause as to what we’re doing in Ottawa if not acting to advance rational objectives and liberal free-market principles.

Back in early 2009 when other developed nations doing it and spending at least two percent of GDP on government make-work projects, this government caved to peer-pressure and took a hit of illicit economic enhancing stimulus. In order to participate in the global pork project, Canada — while best-positioned to whether the global economic downturn — conceded by jumping into the sordid business of direct economic intervention in order to keep borders open to other countries (especially the US) who were looking at stimulus out of conceived necessity rather than as a go along. Indeed, if we had eschewed stimulus, our access to markets would have been closed to government projects in other countries. That 2% of GDP was rationalized by our government in Ottawa as a small price to pay for shelter from a global wave of protectionism that lapped at our shores and border. Yet, I have never heard my government discuss this concession to fiscal conservatives so plainly. But in turn, we fiscal conservatives also fail the governments we elect.

I’ve written before that parties and governments are only principled up to a point. By definition, a government must win a majority or at least a plurality of votes or seats to act. This week the government acted according to a majority of opinion where it counted as votes — in Saskatchewan. Eighty five percent of the residents of that province were firmly against the foreign takeover. As Conservatives with populist roots we should at least take comfort that provincial rights were respected. While acted as a central planner, the plan recognized provincial autonomy.

What should shock and concern us though is that a great number of Saskatchewans either thought that their government still owned the resource or that the majority of shares in Potash Corp were actually owned by Canadians. A Conference Board of Canada report held the sobering truth. For the knee-jerk economic nationalists, it was unknown that a majority of shares of Potash Corp were foreign owned. What should shock us further is that a great number of Canadians are not passionate about the free market principles that have brought more people out of poverty than any other miracle in our history.

These past couple of years have been jarring for a town filled with reporters that cover five news beats with an inch of depth and politicos that write policy on the fly between their stints in undergraduate and business school programs. From constitutional crises, to prorogation, from censuses to potash, if Wikipedia were a publicly traded company, the government would have already nationalized it as a “strategic resource”. Hours before the announcement, many reporters were scrambling to justify their gut feeling that the government was about to go in the wrong direction on the file and approve the takeover. “Apparently potash is some kind of fertilizer made of salt,” one remarked. “‘Pawd-ash’ not ‘pot-ash’ is how its pronounced,” remarked another. When you pair understaffed newsrooms against an army of online amateur “experts” and professional rent-seekers willing to step into the void, you have a recipe for reactionary policy that grows like a weed.

The major communications challenge unmet by this government and by the movement that puts its hopes in the same is that the ground on important issues such as foreign-investment in potash has not been prepared; the studies sit on dusty shelves, the advocates recline unprepared or over-confident. In the new world of Facebook populism, where activism is made more broadly accessible, parties struggle to cultivate grassroots activism and observers sometimes fail to calibrate to measure the significance of an online uprising.

In recent memory, the government has only once prepared the ground for a key showdown on a contentious issue: the long-gun registry. But as for other issues that matter, policy has only been jarringly announced and clumsily if not sparsely advocated. And still, the government is but one megaphone for conservative issues. If conservatives want to see their values implemented in any government (whatever its name), a government that can only a plurality of votes, we must also prepare the soil.

Globally, conservatives must entrench free-market principles as the de facto standard. If protectionists were political pariahs, parties in various countries would compete over who could make the economy freer, not who could protect and reclaim the most from foreign investment. My pride in Canada should be its openness to investment and international growth, not its stagnation for the sake of the failed practice of economic nationalism. Yet, our principles cannot exist in a vacuum; our ideals face competition from special interests. Conservatives cannot believe that government should be small and with limited influence while investing their hopes on it to make transformational change. Our challenge is greater than any government; we have a lot of soil to till because until then our ideas cannot sprout in infertile ground.

Potash decision expected today

Industry Minister Tony Clement will make a decision on the government’s power to block the sale of Potash Corp by Australia-based BHP Billiton later today when markets are closed in Canada and Australia – between 4:30pm and 7pm EST.

From discussions that I’ve had over the past week, I’ve learned that it is expected that the Minister will likely not block the takeover, however, if the takeover goes ahead, strict conditions of sale will be in place which may include promises to invest in infrastructure funds, heritage funds and the like.

Politically, this puts a few federal Conservative MPs in a shaky spot as 85% of their fellow Saskatchwans have expressed concern over the foreign takeover. Conservative-leaning Premier Brad Wall has already read the tea leaves and has come out strongly against the deal.

The decision comes on the heels of a bit of a scatter approach by Industry Canada under this federal Conservative administration when it comes to foreign influence in the Canadian marketplace. Radarsat-2 was blocked for sale by former Industry Minister Jim Prentice, citing the national interest, yet the Amazon and Wind Mobile decisions have suggested a openness to foreign investment in the highly regulated culture and telecommunications sectors.

If Minister Clement announces today that Potash Corp. is ready for sale, it will signal that Canada is open to business and open to foreign investment in the natural resources sector. In a time where this government has fought foreign protectionism due to the global economic collapse of 2008, this will further indicate that the Harper government is not simply paying lip service and lecturing other countries on the same. The liberalization of markets and business is a positive step forward as the global recovery has taken longer than projected. The election of a free-trading Republican House of Representatives and Senate now susceptible to filibuster also helps this cause.

As for today’s decision, the Investment Canada Act stipulates that the Minister must first inform the BHP Billiton of his decision. Until the company makes the decision public the government will be able to comment according to the law.

UPDATE: SHOCKER. Minister Clement determines that BHP Billiton’s bid does not provide a net benefit to Canada.

A very disappointing decision economically in my opinion. Politically it is the safe decision as it will save more votes in Saskatchewan than it will lose from investors. However, sometimes you just hope your government will do the right thing.

The government’s decision is “No” to BHP, however, the world’s largest mining company now has 30 days to revise its bid. This is largely a formality under the Act and a takeover of Potash Corp by BHP is not exactly viable after today.

It was widely expected among Ottawa Conservatives that while the Minister was in a tough position on the potash file, the heightened heat exchanged (and subsequent chill) between the Premier’s office and the PMO indicated that the deal was to be done and that it would be done on the principles listed above.

You should see Tony Clement’s Ron Maclean impression

Tonight, industry minister Tony Clement had a bit of an experience helping in a rescue of a woman drowning in a river. Clement tweets about the experience,

True story & happy ending: we were having dinner when a young woman knocked on our door, hysterical. Her friend was drowning in the river…

We rushed out & dove in. She was just too far away & I felt the undertow working on me. I had to get to the riverbank. Fortunately…

Fortunately Jennifer somehow figured out she could float on her back. Two others got her to shore. Another would-be rescuer then went into..

Went into shock, so we kept him conscious & warm. Our perimedics then arrived & took over. Folks: don’t swim in unfamiliar waters. Swim…

Close to shore. Rapids mean undertows. If a friend is in trouble get help & call 9-1-1. Be well & give your loved ones a hug. I know I am.

Post script: my wife Lynne and her father Doug got to Jennifer first. Another two locals jumped in too. It was a team effort.

It was an intense evening but it shows how community works together, even in the face of danger. All you need is love…

Now I’m totally knackered, as the Brits would say…

Clement’s first tweet on the event.

Let’s hope that we all have similar clarity of mind when we’re called to help. It’s good to hear that everyone’s safe. Now, back to the treacherous census undercurrents in Ottawa that Clement will brave next week. (amazing segue I know…)

Liveblogging the cabinet shuffle

9:52AM: Rob Nicholson, Gail Shea, Leona Aglukkaq, Peter Kent and Peter van Loan, Chuck Strahl show up to Rideau Hall

9:52AM: And Christian Paradis, Jim Prentice. CTV has speculated Prentice to environment.

9:54AM: John Baird has arrived.

9:55AM: Some MPs showing up in Blue Line cabs, some in airport cabs, some in their own cars.

9:55AM: Rona Ambrose shows up. Rumour is she’ll move to HRSDC.

10:00AM: Lynne Yelich is at Rideau Hall and Stockwell Day

10:01AM: James Moore arrives

10:03AM: Rahim Jaffer has shown up. Probably to support his newlywed wife Helena Guergis.

10:06AM: Jim Flaherty arrives with wife Christine Elliot.

10:08AM: The Prime Minister’s motorcade makes its way up to Rideau Hall.

10:16AM: Rumour is that Jason Kenney is moving to Citizenship and Immigration. You heard it here first.

10:25AM: Cabinet embargo about to end. Should have the list up soon.

10:31AM: Other MPs at Rideau Hall: Bev Oda, Peter MacKay, Keith Ashfield, Gary Lunn, Chuck Strahl, Gordon O’Conner, Tony Clement, Gerry Ritz, Stephen Fletcher, and Lawrence Cannon.

10:40AM: Here we go. Here comes cabinet into the hall.

10:44AM: Nicholson stays in Justice, no surprise there.

10:45AM: Greg Thompson at Veterans Affairs, Chuck Strahl at INAC, Vic Toews at Treasury Board

10:48AM: Bev Oda at CIDA, Flaherty at Finance, Gerry Ritz at Agriculture

10:50AM: Jean-Pierre Blackburn to Revenue. Aglukkaq to Health. Finley to HRSRC.

10:55AM: Raitt to NRCan, Day to International Trade and Asia-Pacific Gateway.

10:55AM: Ambrose to Labour.

10:58AM: Prentice to environment. The could be to negotiate new regs with the provinces when it comes to GHG emissions. Alberta will need to sit down with the federal government soon to finalize the new regulations for the oil and gas sector.

11:00AM: Baird goes to Transport/Infrastructure.

11:01AM: Cannon goes to Foreign Affairs.

11:02AM: Tony Clement goes to Industry.

11:05AM: Josee Verner to intergovernmental affairs.

11:05AM: Jay Hill to House Leader.

11:05AM: PVL to Public Safety.

11:07AM: Jason Kenney to Citizenship, Immigration and Multiculturalism.

11:08AM: Christian Paradis to Public Works.

11:09AM: James Moore to Heritage and Official Languages.

11:14AM: Gail Shea to Fisheries.

11:16AM: Gary Lunn to Sport.

11:17AM: Gordon O’Connor to Government Whip.

11:18AM: Helena Guergis to Status of Women.

11:19AM: Diane Ablonczy stays at Small Business.

11:20AM: Rob Merrifield to Minister of State (Transport).

11:22AM: Lynne Yelich to Western Economic Diversification.

11:24AM: Steven Fletcher to Democratic Reform.

11:27AM: Gary Goodyear to Minister of State for Science and Technology. Goodyear will work closely with Minister of Industry Tony Clement.

11:29AM: Denis Lebel to economic development for Quebec. Lebel will be the cash man for Quebec and this will help him electorally.

11:31AM: Keith Ashfield to ACOA.

11:32AM: Peter Kent to Secretary of State for Foreign Affairs (Americas).

Final cabinet speculation

Mostly certain:
– Prime Minister Stephen Harper
– Flaherty to stay in Finance (confirmed by numerous people in the department)
– Baird moving (confirmed)
– Clement moving
– Guergis moving (family has flown in, and hair appointment booked early AM tomorrow apparently)
– Bernier not in cabinet
– Aglukkaq in cabinet
– Prentice staying in Industry (no indication of a move from bureaucrats or political staffers up until midnight)
– Lunn moving (family has flown in)
– Verner moving
– MacKay stays in defence
– a good number of Secretaries of State named

Responsibly speculative:
– Cannon in foreign affairs (heard this from a high level source on Tuesday night)
– Kenney at CIC
– Nicholson stays in Justice
– Strahl stays at INAC
– Clement in trade
– Baird in transport
– Verner to intergovernmental affairs
– Ambrose to HRSDC
– Shea or Duncan in Fisheries
– Raitt in cabinet
– James Moore promoted

Wildly and so irresponsibly speculative:
– Raitt to get NRCan (doubtful)
– Liberal crosses the floor and enters cabinet (sourced at a high level, but I don’t see it happening. Yet, a number of Liberals staffers have been confirming they’ve heard the same rumour for days)
– Rob Moore in cabinet

Cabinet facts and speculation

See my final cabinet speculation here

Tomorrow, Prime Minister Stephen Harper will name his new cabinet at Rideau Hall at 10:30am. There is a lot of speculation flowing out there and from this, I’ve been able to discern a few facts.

First, the easy facts: cabinet will be larger and have more women. Stephen Harper was returned to 24 Sussex on October 14th with an increased minority. Among the new seats gained by the Tories include a number of well-qualified women.

Second, Jim Flaherty stays in finance. In a time of global economic uncertainty, and after an election fought on stability in these times, changing the minister of finance could be seen as a bad signal to the world.

A few speculated that Helena Guergis may be retiring to the backbench. However, Guergis has told her junior ministerial staff that they’ll be employed in her office for at least the short-term future. I’ve also heard that Guergis is moving portfolios. Josee Verner is also moving portfolios.

Environment minister John Baird will also be moving portfolios now that green leader of the opposition Stephane Dion is stepping down. Baird was the go-to guy for acting as a shield for the government on tricky portfolios. He’ll move on to new responsibilities in cabinet.

As of Friday night, when most cabinet hopefuls had received their calls from the PM invited them to serve in the new cabinet, Maxime Bernier was left waiting. A few speculated that he’d return to cabinet, however, it seems that he’ll have some more time in the penalty box.

The newly minted Member of Parliament from Nunavut Leona Aglukkaq will serve in the next cabinet. Stephen Harper personally recruited the former territorial minister and has made northern sovereignty a defining issue of his Prime Ministership. Aglukkaq would be the first female Inuit to serve in federal cabinet. It is expected that she’ll become responsible for the new opportunities agency for the north.

Speculative news that I’m hearing is that Trade will be shifted from Foreign Affairs to Industry and that the Minister of Industry would also assume duties for this portfolio. Or, alternatively, trade will be under Industry bur will have a separate minister. The last election saw the defeat of Harper’s trade minister and a failure to re-offer by his foreign affairs minister.

On foreign affairs, I’m hearing that Lawrence Cannon will herd the cats at DFAIT. A french-speaking and centrist Conservative, Cannon may be Harper’s choice to head that portfolio.

In departmental news, I’m hearing that Transport and Infrastructure will be broken into two. Rookie MP Lisa Raitt may be a perfect fit for a reduced transport portfolio, while a Toronto area minister such as Peter Kent may fit the bill to shower the region with infrastructure development money. UPDATE: A bureaucrat that has seen the briefing books for Transport’s next minister says that infrastructure is still part of Transport’s mandate.

Will there be another Liberal defection to cabinet? I’m hearing yes and that it’ll be from Quebec (I’d categorize this as speculative even though my high level source seemed to be certain). After the last election Vancouver MP David Emerson jumped from the Liberal ranks to sit as a Conservative cabinet minister. With a Liberal party in ruin, we may just see one or more defections tomorrow.

UPDATE: Tony Clement is now confirmed as moving from the Ministry of Health.

UPDATE: Jim Prentice is expected to stay at Industry.

UPDATE: I’m hearing that Verner is going to intergovernmental affairs.

UPDATE: Late breaking speculative gossip: Ambrose to HRSDC?

UPDATE: Hill from Whip to House Leader?

Canadian Networking Conference and Exhibition

Blogging has been light recently as the Manning Centre for Building Democracy (where I am a Fellow) held its annual Canadian Networking Conference and Exhibition in Ottawa this weekend. Here’s how the Hill Times reported on it this morning,

“Meanwhile, a whole slew of Conservative heavy-hitters attended the Manning Centre Conference, including former Alberta premier Ralph Klein and former New Brunswick premier Bernard Lord who spoke about his early days as political leader. Health Minister Tony Clement also delivered a speech on his election experiences, while former Ontario premier Mike Harris participated on a panel discussing the Conservative movement and health care. Conservative blogger Stephen Taylor made a presentation on social networking and Richard Ciano, who runs the Conservative Campaign University, spoke about campaign technologies and techniques. Former Nova Scotia premier John Hamm introduced former Reform Party leader Preston Manning, who gave the closing address.”

The conference kicked off with a reception held on Thursday evening which was attended by the Prime Minister, Preston Manning and a handful of cabinet ministers including Jim Flaherty and Monte Solberg. Preparing for the conference all day, I had not been able to evaluate the gravity of the Cadman-related allegations (I had only been peripherally aware of some Cadman-related story in the news) and greeting the Prime Minister, I cheerfully told him of my optimism related to recent events. In retrospect, I’m thankful that after this potentially disastrous declaration I referenced Dion’s deflation over the budget and the Liberal leader’s general troubles. That night, after getting home very late, I got caught up on the news and knew that it would be unsettling for my Conservative friends in Ottawa for some time.

The conference however soldiered on and the mood was generally upbeat. I got to catch up with a number of Blogging Tories and met a few of them in person for the first time. Dr. Roy, Steve from OfficiallyScrewed.com, Luca Manfredi and Sara Landriault were there among others. Even former BT “alumnus” Monte Solberg hung out for most of Saturday’s speeches. A quick poll that I took during my Saturday talk indicated that Blogging Tories was known to almost all of the attendees of the conference but many were surprised as to the depth and utility of the website; I took the opportunity to launch new features of the website from the stage including aggregated columnists, the aggregated conservative movement and the new version of Blogging Tories television. I’m also planning on launching a new feature on the website today so watch for it.

For all of those that came to the conference, thank you! For those that were unable to attend, we’ll be aiming for an even larger gathering of the conservative movement next year.

2004 Leadership race: fundraiser breakdown

The numbers are out on the fundraising front for the CPC 2004 leadership election. The documents have been released (h/t BBS) and there are some interesting numbers from the “returns” of the Harper, Stronach, and Clement campaigns.

First, the total expenses of each campaign:
Tony Clement: $826,807
Stephen Harper: $2,073,084
Belinda Stronach: $2,496,482

and now, some interesting numbers from the returns.

Belinda Stronach contributed $3,950,000 of her own money towards her own campaign. Tony Clement, while contributing $0 of his own money, $3,000 was contributed by his family. The Harper family (or at least people named Harper) contributed $3,525.

Power Corp donated $25,000 to each of the three campaigns. EnCana did the same.

John Tory donated to $8,600 to Tony Clement’s campaign.

Belinda Stronach gave $100,000 to Tony Clement’s campaign, while Stephen Harper’s campaign gave $10,000 to Mr. Clement’s leadership bid. Everyone loves Tony…

Stronach did not have any financial support from any member (on quick glance) of the Conservative caucus (House of Commons), while Harper enjoyed wide support through many MPs (or through MPs spouses).

Rex, ask your editors

rex.jpgIn a recent column concerning the Conservative Party of Canada leadership race, Rex Murphy mused perplexedly over the paucity of confabulatory prose by this nation’s columnists and news writers on the topic of the race.

Rex, the leadership race is not dead. Your editors have merely found another story and they’re running with it. I’m talking, of course, about the American Democratic Party Leadership Race. Why is our nation’s news media so focused on a topic that they usually abhor? Indeed, our national news peddlers tend to give American news less attention than its worth. Yet, why does our opposition’s leadership race get so much less coverage than the American’s opposition leadership race receives? The American Democrats and the Canadian Conservatives are trying to do the same thing, in effect: change the government. However, Peter Mansbridge has spoken more about John Kerry than Belinda Stronach, and we’ve heard more about Lieberman’s Joementum (or lack thereof) than we have heard about Tony Clement.

Our leadership race is news. Rex, you should ask your editors why they’re choosing to ignore the story. Without media coverage, our leadership contenders can only be heard as far as they can shout. Mr. Murphy has declared that Belinda Stronach, Tony Clement and Stephen Harper have all climbed inside a “Trojan horse”, ready to attack the Liberal party’s stranglehold on power. It’s not that the three intend to stay within the horse, rather, it’s that nobody has told the city of Troy that the horse is waiting outside its gates.