Morneau can’t fix the problem: It is him
Perhaps Bill Morneau imagines that by agreeing to give away the capital gain he earned on the shares in Morneau Shepell he owned he has made the problem go away.
He has not.
He has made a problem go away: he cannot now be accused of having actually profited from the decisions he made as finance minister.
But the larger problem implied by his conduct remains, because it is increasingly clear the problem is him.
All that he has done is to put right what he himself put wrong. He divested shares that he should have divested two years ago; the capital gains he will forgo are only the return on that earlier misconduct. The minister, what is more, does not believe he did anything wrong, as is clear from his public statements: far from atonement for past sins, these latest measures are cited as evidence of his superior virtue, inasmuch as they go “above and beyond” the actions he was famously advised to take by the ethics commissioner.
Far from accepting any punishment — for having failed to divest or place the shares in a blind trust; for having misled everyone into thinking he had; for having introduced Bill C-27, which would arguably increase the value of the shares he controlled — he plainly believes he should be congratulated for his later efforts at damage control.
So to compound the original error of judgment, the minister would appear to have learned nothing from its discovery. Because of course he has only done any of this because it became public knowledge. Had his failure to divest not been reported, he would still own the shares, still be legislating in ways that affect their value, still in secret.
Whether he actually broke the law is not the issue: we are entitled to hold public office holders to a higher standard than merely obeying the law. Neither is it relevant that, as his defenders argue, he is too rich to have needed the money, or that he never intended to enrich himself, or even whether he actually enriched himself. All we need know, as far as his conduct as a minister is concerned, is that he acted in a way that could reasonably be expected to enrich himself, such that a reasonable member of the public might wonder whether that influenced his decision.
That is what is meant by the injunction, found in many ethics codes, about arranging your personal affairs in a way that “would withstand the closest scrutiny.” It is not the public’s obligation to give the minister the benefit of the doubt with regard to his personal integrity. It is the minister’s obligation not to give them any reason to doubt.
Well, we all make mistakes. Perhaps Morneau is right to complain he is being held to a higher standard than previous office-holders — though it is a struggle to recall a finance minister who held such a large position in a company he
regulated. (Paul Martin’s ownership of Canada Steamship Lines was troublesome enough.)
On the other hand, people might be more forgiving if the minister were more forthcoming. Even now he doggedly resists taking the sorts of action that would dispel any lingering doubts — that is, by answering the questions he has thus far refused to answer.
There is, for starters, the strange tale of the “missing million” — the shares in Morneau Shepell the minister says he sold some time after stepping down as an officer of the company in October, 2015, reducing his stake from 2.2 million to the current 1 million. When he sold them, who he sold them to, at what price, with what understandings, are all unknown. Presumably we will be better informed about the disposition of the remaining million.
Then there are all those opaque numbered companies he will continue to own, but in a blind trust. As structured, the trust would be blind to everyone except Morneau. He knows what the companies contain. Nobody else (except the ethics commissioner) does. If he were ever entitled to the benefit of the doubt in this regard, that can hardly continue, after their use to conceal his Morneau Shepell holdings.
And there is the question of whether, having used this “indirect” ownership structure to get around the Conflict of Interest Act’s divestment requirements, he was in compliance with the Act in other respects: that is, by recusing himself from decisions in which he had a conflict, and publicly reporting when he did. All we know is that the minister thinks he recused himself in a couple of cases he won’t tell us about. These do not appear to include C-27.
How he was able to get away with this is even murkier. Supposedly it was with the ethics commissioner’s blessing, again: the “conflict of interest screen” she recommended in place of divestment is intended to prevent potential conflicts from even reaching his desk. Did it? The commissioner is now investigating, or about to investigate, or may be about to investigate, the minister’s involvement in C-27. At any rate, she’s going to “follow up” with him about it.
There are larger questions, too, of what changes to the law may be needed.
For now I’d be satisfied knowing: Was the law followed here? If not, why not? And if it was — if the law allows a minister to secretly control shares in companies he regulates, without requiring him to divest, recuse himself or even disclose — then what good is it?