CLOCK TICKS TOWARD DEADLINE
Iran’s nuclear ambition on the line
Here’s a bet: Joe Oliver’s budget — current whereabouts unknown, somewhat like the finance minister himself — and the Liberal response to it will yield the ultimate ballot question in the 2015 election. That’s because, security craze aside, the economy is the only big remaining file on which the two front- running parties, Conservatives and Liberals, are still battling over the same turf. And it is prime real estate.
That’s right. Intriguingly, after years of policy convergence among Grits, Tories and Dippers, we’re seeing a divergence this election year, with each moving into a pattern that will feel oddly familiar to anyone who remembers disco.
Liberal Leader Justin Trudeau crossed a Rubicon of sorts this past month. In Toronto on March 9, he planted his flag on a defence of the Charter of Rights and Freedoms. The speech was nominally about liberty; practically, it was a party- defining moment in which Trudeau cast himself as a champion of pluralism and Stephen Harper as its foe. The ensuing howls of outrage merely solidified the frame. Then last Tuesday, Trudeau declared his opposition to the government’s motion to extend and expand its military mission in Iraq.
Practically, since the motion was bound to pass anyway, this was of little moment. But symbolically, it is significant. It marks a shift away from the Liberals’ vaunted Responsibility to Protect doctrine, under which they launched the Afghan mission in 2002, expanded it in late 2005 and voted to extend it in 2008, and back toward a non- interventionism more characteristic of the Chrétien years, and especially the Pierre Trudeau era. This is the Liberal party, on social and foreign policy, deliberately stepping leftward.
What’s fascinating is the contrast this creates between the Blue and the Red, now deadlocked in public support. For each seems content to let the other carve out its territory. The Liberals are not equivocating about bombing the Islamic State of Iraq and the Levant, as they were last fall; they’re dead set against it. And the Tories, with the exception perhaps of Multiculturalism Minister Jason Kenney, seem content to become the Party for Those Who Fear and Mistrust Islam. Harper certainly has not uttered a word in weeks to suggest otherwise. Liberal doves versus Tory hawks: It’s 2003 again, or 1983, for that matter.
And the same goes for the New Democrats. On Friday, former Quebec Liberal Thomas Mulcair gave the clearest signal yet that he intends to run a traditional social- democratic campaign, promising to seize tax benefits from stock- option holders and turn the proceeds over to the poor. In strategic terms, this acknowledges the obvious: Stuck at just above 20 per cent in public support, according to aggregated polls tracked by threehundredeight.com, the NDP’s best hope of retaining seats is to make like Robin Hood, as of old.
In other words, each party is targeting traditional supporters, except on the economy, where the Liberals and Tories are seeking the same prize, which is also the largest voting block: the middle class, broadly defined as anyone earning above $ 44,701, the second- lowest federal tax bracket, up to and including anyone earning less than $ 138,586, the second- from- highest tax bracket.
Even with Conservatives hyperventilating non- stop about security, the Canadian habit of voting on pocketbook issues is not likely to change, barring an outbreak of total war. It has been reinforced, ironically, by years of Tory messaging. And polls show the government is vulnerable here: An Ipsos Reid survey in February found half the respondents worried about retirement. With the price of crude below $ 50 a barrel and job growth at a 40- year low, that sentiment can be expected to grow.
To check this, Harper has income- splitting, worth up to $ 2,000 for a couple with children under 18; the enhanced universal child benefit, which amounts to a $ 60- a- month increase for children under six and an additional $ 60 a month for children aged six to 17; and a $ 1,000 rise in the maximum claimable child- care expense deduction. The latter two measures will appeal to many, especially when the money starts flowing in July.
But the biggest- ticket item, income- splitting, is a dud. The C. D. Howe Institute and more recently the Parliamentary Budget Officer say it benefits only the wealthiest 15 per cent of families, confirming an earlier criticism of the late Jim Flaherty, while costing the Treasury $ 2 billion a year. This is heaven- sent for the Liberals, who are planning measures that will more broadly benefit middle- income earners.
Something to watch: Unlike the NDP, the Grits have not explicitly ruled out tax increases on the wealthy, typically defined as those earning over $ 150,000 a year.
It boils down to this: Heading into spring, the finance minister is under pressure to come up with something juicier than income- splitting, to keep Main Street out of Trudeau’s clutches. But he has little room to work, thanks to the oil- revenue slide, while still keeping the budget in balance.
It’s an intractable problem, the solution to which is not obvious. Small wonder Oliver has been too busy to attend question period lately. A budget date is expected any day.