The chips are falling into place...

...for a fall election. At least on the Conservative side. Even though Harper, of course totally doesn't want an election. No way Jose...

The federal government has reached a deal with Nova Scotia over offshore revenue sharing, ending a politically damaging battle with the province amid talk of a fall election.

The new arrangement will provide Nova Scotia with a guarantee that it will not lose any royalties under changes made to its cherished offshore accord in last spring's federal budget.

A deal, or a surrender by Harper to pave the way for a fall election? I don't know enough about the details to say one way or another, so I'll leave that to the experts and the spinners. I do know this though:

A three-person panel will be set up to study the value of the complex cash royalty, which was part of the province's original 1985 offshore agreement...The panel is expected to report with a binding decision, which could mean a large cash payment to the province.

A billion here, a billion there, and just in time for an election campaign. Handy that. It will be interesting to see if Bill Casey now comes back into the Conservative fold. I imagine the Cons will be putting major pressure on him to do so. (Or not, see update below) One also wonders if it will be enough to save Peter McKay's seat.

Found it a little peculiar there were no comments from Premier MacDonald in the story, just Harper, as I was interested to see how Rodney would frame it. Maybe CP will add that in later. Also interesting was that this came the day after the Newfoundland elections and Danny Williams' landslide victory. Danny, by the way, called the Nova Scotia deal a bad one:

The premier of Newfoundland and Labrador blasted the agreement in St. John‘s today, saying Prime Minister Stephen Harper has gotten Premier Rodney MacDonald to take less than he would get under the Atlantic accords, adding that Harper has “a way of preying on the weak.‘‘

So, Newfoundland is still an issue to be dealt with for the Cons, as is Saskatchewan, who the story notes are still suing the feds over equalization. Between this and the Wheat Board brouhaha the Cons are in trouble in Saskatchewan. I'd expect the NDP to take some seats from them there at the moment, and maybe if we're lucky the Liberals could sneak-in too.

After the Nova Scotia deal, if we see a quick move to appease Saskatchewan it would be an even clearer sign (were it not blindingly obvious already) that Harper is determined to go to the polls this fall.

Meanwhile, in Liberal land, Stephane Dion had a press conference yesterday and announced...well, not a lot really. He shuffled around his shadow cabinet, made Bob Rae foreign affairs critic, gave Garth Turner a job too, and booted one MP from their critic portfolio:

Mr. Dion also stripped MP Raymonde Folco of her role as official languages critic — she had told reporters that Mr. Dion was not selling in Quebec and was too old to change his ways...

Good, this was very necessary. I would have liked to have seen some of the other people that broke confidentiality and ran to the press over the Carroll thing punted too though. Still, hopefully this sends a message. While debate is good, and changes need to be made, it's important for party executives and MPs to work within the system, not through the media. Undermine the leader in public and there need to be consequences.

On an unrelated matter, I would also have liked to have seen Denis Coderre moved out of the defence critic job. I admit, that was probably impossible after the whole Afghan trip thing this week, the timing and optics would have been brutal. But while I've defended Coderre on the trip issue because I believe he's in the right there, I still would rather see someone else in that role. Nearly anyone else, to be honest.

In other news from the Dion presser:

Stéphane Dion signalled Tuesday that he will try to sidestep a fall election, and might even tell his Liberal MPs to sit out a confidence vote on the Conservative government's agenda.

Sigh. It looks like Bryan Wilfert wasn't freelancing after all, but was floating a trial balloon for the OLO. I've already articulated why I think this is an exceedingly crappy idea, and nothing I've heard since has served to change my mind. I'm not pleased to hear this. As I said earlier, we need to start standing-up for Liberal values again. Prop-up the Cons and I don't care how you spin it, it'll be bad. Jack and Gilles will be over the moon.

Finally, an example of really lame attempted Conservative spin:

Conservatives, meanwhile, scoffed that Mr. Dion has decided to avoid an election because his party is in disarray.

"The Liberals are struggling with a weak leader, thin bench strength and a tarnished brand," said Conservative party spokesman Ryan Sparrow.

Of course, the Conservatives (say they) don't want an election either. I guess that's because Harper is such a strong leader with strong bench strength and a shiny brand, right Ryan? Or maybe they're just lying when they say they want to avoid an election...

UPDATE 1: Via Garth Turner comes this exchange from Harper's presser on the Nova Scotia deal, and Bill Casey:

Question: Prime minister, now that you’ve got this agreement, are you going to welcome Mr. Casey back into the Conservative caucus?

Answer: No. Mr. Casey made demands that he knew were incompatible with our budget, that he knew that this government would not agree to and has not agreed to. Mr. Casey is not welcome into our caucus. Just so I can be as clear as i can be on it, there — when there is a next federal election there will be a conservative candidate in Mr. Casey’s riding, and it will not be Mr. Casey.

Well, I guess that settles that. As Garth says, vindictive, petty, spiteful, bully. To that I would add stupid. I could see Harper being enough of a dick to freeze Casey out if he wanted back, but what's the political upside to such a course. I've always maintained that, despite his being arrogant and wrong and all that, Harper is a smart strategist. He's lost me here though, because I don't get it. Neither does Steve.

UPDATE 2: Speaking of Carroll, something that was probably inevitable finally happened today. Since it seemed fairly clear we were heading this way, one wonders what the frick took them so long?!

Jamie Carroll has officially stepped down from the party's top administrative job and he has given up his role as deputy national campaign director as well.

The announcement comes after weeks of controversy over Carroll's allegedly dismissive response to demands that Dion include more Quebecers in his inner circle.

It's unfortunate, because I think Carroll is a good guy and that the infamous diversity remarks were blown widely out of proportion by people with their own agendas. However, I think for the good of the party and the sake of party unity he probably had to go. Rightly or wrongly, he had become a lighting rod for controversy. It dates back to his ill considered remarks in Diebel's book. It wasn't all his fault, but he had become a roadblock to progress.

Now, with Carroll gone, it will be interesting to see if the people who were calling for his ouster now get on board and start being team players working for the good of the party. Were their motives what's right for the party, or driven by their own personal agendas? With Carroll now gone, their reaction and behaviour going forward will tell the tale.

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Saturday news round-up

I'm in Ottawa for the weekend and heading out soon to check-out the new War Museum before the Progressive Bloggers BBQ in Nepean this afternoon. Hopefully the RCMP won’t ban bloggers from the public park where we’ll be gathering but you never know, what the PMO wants the PMO gets.

In the mean time, here’s a quick round-up of recent news headlines:

*The Paul Martin Liberals were accused of having some many ideas and grand visions they couldn’t actually get much done. Harper’s Conservatives went the other way, five easily understandable and implementable priorities. As Jim Travers writes though there must be a middle ground, some vision from Deceivin’ Steven would be nice.

*Down in the U.S. the liberal blogs are playing a big part in the Democratic presidential race. I think we’re a long ways from having that kind of critical mass here in Canada, although I think the role blogging played in last year’s Liberal leadership race was a start, and the LPC inviting bloggers of all political stripes to the convention was a big step. I’m looking forward to my invite to the next Conservative convention…

*Speaking of leadership, more work is being done to bring together organizers from the different leadership camps, which is good to see. I think the grassroots have no appetite for sniping, if the organizers and mythical ‘senior Liberals’ can all get on the same page then we’ll be in good shape.

*An editorial in the Sudbury Star sums up nicely what I’ve been saying for months:

Stephen Harper has a little problem. Well into his second year in office, the economy is humming and he has no significant gaffes or scandals on his blotter. Earlier this year, the Tories threw everything they had at Liberal leader Stephane Dion in TV ads branding him a weakling, indecisive and a geek. Yet polls show the Liberals and Conservatives remain tied in a statistical dead heat.

How could this be?

The editorial says it comes down to personality, and that’s certainly part of it. Working without a script Harper is much less likeable, and when he’s challenged, which tends to happen in a minority parliament, he goes on the attack and becomes even less likeable. And with all his flip-flops he is no longer seen as principled. Which, the editorial points out, is one card Dion has remaining:

The field is wide open now for Dion, whom many political observers had written off, to start hammering Harper for his personal failings.

That's because Dion, Tory attack ads notwithstanding, is still mostly perceived to be a man of principle, rather than slick or pragmatic politics. He can stake out the moral high ground and be believed. His personal awkwardness, even as he works to move beyond it, can be recast as a badge of sincerity. Lemons, into lemonade.

*Steve Harper’s culture of defeat-apoloza tour 2007 is playing to less than rave reviews, and not just from Danny Williams. One newspaper publisher is particularly harsh:

"Islanders don't care if Stephen Harper is coming to P.E.I., and even if he brings his whole caucus here for a few days, it won't improve his standing with Maritimers in general," says Paul MacNeill, publisher of the Eastern Graphic, a P.E.I. institution and one of the region's most respected local newspapers.

"His visit here won't do a thing (to help his party). I guarantee you that."

A poly-sci prof puts it in more eloquent terms, though no less stark:

"Harper needs to repair the damage to the Conservative brand here in Atlantic Canada," says Peter McKenna, a political scientist at the University of Prince Edward Island, "but my read is that that ship has already sailed and it's probably too late."

Maybe it’s because of things like this:

Harper was scheduled to deliver what his spokesmen said would be a partisan, "anti-(Stephane) Dion" speech Wednesday night to an audience of Tories from P.E.I and New Brunswick.

Newsflash Steve: you’re Prime Minister. Maybe try giving people a reason to vote for you, rather than a reason not to vote Liberal. Especially this strategy seems to have earned him a polling tie with the Libs.

*Carol Skelton has announced she won’t be seeking re-election. Another rat fleeing a sinking ship, and more proof Stephane Dion is not a leader….oh wait, she’s Conservative, isn’t she? Never mind.

Indeed, she’s a Conservative cabinet minister from Saskatchewan (meaning she’ll be shuffled out for a new face soon) and, of course, wants to spend more time with her family. Surely it has nothing to do with probably getting smoked next election due to Conservative policies vis a vis the Wheat Board? Of course not, silly goose.

Experts say Ms. Skelton might have had a tougher time winning the riding. Indeed, she took it in a relatively close race last time around, winning by about 2,000 votes over NDP candidate Nettie Wiebe, a strong supporter of the Wheat Board and a former president of the National Farmers Union. Ms. Wiebe is nominated to run again.

*Speaking of the Wheat Board, the Regina Leader-Post rightly wonders why Steve “law and order” Harper seems to have so little respect for the law:

An unrepentant Harper admitted he was "disappointed'' with the court's decision. But he added "that doesn't change the determination of the Government of Canada to see a dual market for Canadian farmers.''

In other words, Harper is saying: "I don't care what the law says. I'm hell-bent on getting the wheat board out of barley marketing, come hell or high water."

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Resource/equalization issue a potential factor in 32 ridings

An interesting story in the National Post today that contains some stark but unsurprisingly low popularity numbers for the Cons in Atlantic Canada, but also points out the resource/equalization issue may be a real ticking time bomb for Deceivin’ Steven.

Between February and May, the federal Tories' satisfaction rating with Newfoundlanders fell from 47% to 17%, according to a Corporate Research Associates Inc. poll. At the same time, dissatisfaction with the federal government's performance rose from 47% to 78%.

Things aren't much better in Nova Scotia. Satisfaction fell from 50 to 37%, while dissatisfaction rose from 41 to 58%.
...
Derek Leebosch, a senior associate with Toronto pollster Environics Research Group, reports that in March, 38% of Atlantic Canadians approved of the way the federal government was keeping its promises. By June, that had fallen to 22% -- far lower than the rest of Canada, where the figure is typically in the 40s.

While the Atlantic Accord has gotten most of the attention and it’s easy for the Cons to dismiss the non-seat rich Maritimes, when you factor in Saskatchewan things start to get interesting:

But the problem for the Tories may be larger than just Atlantic provinces. Between Newfoundland, Nova Scotia and Saskatchewan the resource/equalization issue could have an impact on what voters do in a total of 32 ridings.

"I suppose every seat counts and if you lose a couple there, then in your odyssey to get a majority, you have to make them up somewhere else," Mr. Leebosch added.

Forget a majority; with 32 seats impacted they’ll be fighting to hang-on to their minority. Particularly when you factor in another ticking time bomb, income trusts, plus the wheat board, Afghanistan, and a host of other issues that are already sapping Conservative popularity.

No wonder Deceivin’ Steven is in no hurry to call the rest of those by-elections…

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I guess accountability means it's someone else's fault?

This story crossed my radar last week when Red pointed-out the proliferation of anonymous Conservative sources quoted throughout. It’s also an interesting article for another reason though: it underscores Deceivin’ Steven’s inability to take responsibility for anything. It’s always someone else’s fault.

In a nutshell, the article posits Finance Minister Jim Flaherty may be punted over the side and out of the finance portfolio due to the bungling of the Atlantic Accord. Indeed, “senior Conservatives” including some apparently from within the PMO, say Jimbo is on the way out.

Now, I’ll grant the anonomyi that Flaherty may have become radioactive, and a new face in the job might help smooth things over. But here’s where they lose me:

Some staffers in the Prime Minister’s Office blame Mr. Flaherty’s office for failing to anticipate the political problems the budget would cause on the East Coast.

"They were surprised that the department didn’t foresee how badly this would go over with the two premiers who are whining the most," said a source close to the government. "Work wasn’t done beforehand to signal that it was coming or correct it or whatever had to be done."

They’re saying this thing is Flaherty’s fault? That’s just stupid. Even if it wasn’t known that Harper is a control-freak, the fact remains Harper was calling the shots on this thing from day one. Nothing happens without the approval of the big man, not in Harper’s Ottawa.

But now they’re going to blame this on Flahety. But wait, it gets better. More anonuymous Cons, talking now about the imfamous letter to NS Premier Rodney MacDonald vowing no side-deals written by the PMO, the one Flaherty signed after Peter McKay refused to:

"Flaherty hurt himself in Atlantic Canada by agreeing to sign that letter from the Prime Minister’s Office," said one Tory. "Perhaps he should have exercised better judgment there, but he sees himself as a team player."

So, senior Conservatives, perhaps from within the PMO, are saying Flaherty exercised bad judgment in agreeing to sign a letter he was told to sign BY THE PMO?! Told you it got better. Crazy Jim, don’t you know the PMO are idiots? Don’t listen to them!

Hey, here’s someone talking on the record. Former Conservative MP Bill Casey, can you make sense of this for me?

Mr. Casey, who has been sitting as an Independent since voting against the Tory budget, says he’s not sure Mr. Flaherty is the problem, since Mr. Harper’s office wrote the letter that angered Mr. MacDonald.

"Mr. Flaherty was negotiating side deals until that letter appeared in the Halifax Herald, when he said there was no side deals," said Mr. Casey. "But I know the government of Canada was trying to negotiate side deals instead of the Atlantic accord. So somebody overruled him on that Saturday when that letter came out. They were negotiating but apparently they weren’t allowed to. It’s a puzzle to me."

Bill has it right. As much as I dislike Jim Flaherty and wouldn’t mind seeing him gone, in this particular case he’s not the problem. It would seem logical the person that overruled Flaherty should be the one walking the plank. I’ll give you three guesses who that was, and the first two don’t count.

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Bill Casey recognizes Harper's control freak tendencies

Interesting comments in this article from former Conservative MP Bill Casey on his view of Deceivin' Steven from the opposition benches. Casey, of course, was given the boot by Harper for standing-up for the CPC's election promise on the Atlantic Accord, voting against the budget and proving Peter McKay, once again, to be a fibber (Fiberative, perhaps?)

Former Tory MP Bill Casey is puzzled by the Conservatives' strategy of government control, and it's one he's now trying to comprehend from the Opposition benches.

You and me both William, you and me both. Actually I guess I’m more bemused than puzzled.

He said by centralizing services and programs in Ottawa, cutting the budget of Atlantic Canada's regional development body, and breaking signed contracts between provinces, the federal government has painted a picture of Atlantic Canada that he must speak out against.

Casey really shouldn’t be surprised, given his ex-leader’s previous comments on the region:

"Atlantic Canada's culture of defeat will be hard to overcome as long as Atlantic Canada is actually physically trailing the rest of the country." -- Harper

But back to the article, I found it interesting that Casey seemed to almost channel Preston Manning and the old Reformers here:

"If the people in Ottawa make all the decisions, they'll be made wrong because Ottawa doesn't reflect the country and it certainly doesn't reflect Atlantic Canada," he told the Times and Transcript…. "I believe that the government has a philosophy," he explained. "They want to run things the same across the country. They want to have one system for every program. The problem is you can't have a uniform program in Canada because we don't have a uniform country. Every area has different challenges, different cultures and different situations."

Some rather insightful comments from Casey I thought. Also interesting that the Conservatives sent out an ex-journalist and communications director for Peter McKay, Dan Dugas, to respond, rather than McKay himself.

Come to think of it, has anyone seen McKay lately? He seems to have disappeared since Harper embarrassed him over the whole Atlantic Accord thing and likely signed his political death papers.

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Decivin' Steven on the Atlantic Accord, circa 2004

God bless Hansard. Here’s what Decivin' Steven was saying about the Atlantic Accord and election promises less than three years ago...(h/t tony)

38th PARLIAMENT, 1st SESSION
EDITED HANSARD • NUMBER 022
CONTENTS
Thursday, November 4, 2004

Hon. Stephen Harper (Leader of the Opposition, CPC) moved:

That this House deplore the attitude of the Prime Minister of Canada at and following the First Ministers' Conference of October 26, 2004, and that it call on the federal government to immediately implement its pledges of June 5 and 27, 2004, to allow the provinces of Newfoundland and Labrador, and Nova Scotia to keep 100% of their provincial offshore oil and gas revenues.

He said: Mr. Speaker,I will be splitting my time with our deputy leader from Central Nova.

On June 5 of this year the Prime Minister arrived in St. John's, the capital of Newfoundland and Labrador. The context was the following. Obviously it was an election campaign when the Prime Minister was asked to respond to a longstanding Conservative commitment to ensure that the Atlantic provinces would enjoy 100% of their non-renewable resource royalties.

This is a commitment that was made by me in my capacity as leader of the Canadian Alliance when I first arrived here and has its origins in the intentions of the Atlantic accord signed by former Prime Minister Mulroney in the mid-1980s. These are longstanding commitments, our commitment to 100% of non-renewable resource royalties. It was our commitment during the election, before the election, and it remains our commitment today.

For the Prime Minister, this was something that he had opposed for 11 years and for most of his political career. But suddenly in the midst of an election campaign on June 5, he met with Newfoundland and Labrador Premier Danny Williams. He came out of that meeting and said the following:

"I believe that Newfoundland and Labrador ought to be the primary beneficiary of the offshore resources, and what I have said to the premier is that I believe the proposal that he has put forth certainly provides the basis of an agreement between the two of us."

Premier Williams specified in a letter dated June 10 that:

'The proposal my government made to you and your Minister of Natural Resources provides for 100% of direct provincial revenues generated by the petroleum resources in the Newfoundland and Labrador Offshore Area, to accrue to the government of Newfoundland and Labrador and be sheltered from the clawback provisions of the equalization formula--'

The Prime Minister said he agreed with the Premier's proposal and he gave his word as Prime Minister of Canada. Premier Williams was asked at the press conference announcing the deal how he could be sure the Prime Minister would keep his word after the election. He replied that as a man of honour, that the solemn word of the Prime Minister was sufficient. Premier Williams said: “It's by word of mouth, and I'm taking him at his word, and that's good enough for me”.

Unfortunately, the solemn word of this Prime Minister turned out to be not good enough. The Prime Minister ignored letters from Premier Williams on June 10, August 5 and August 24 urging him to confirm his promise. Suddenly, the Prime Minister and his Minister of Natural Resources fell silent.

Finally, on October 24, two days before the first ministers' conference, the Minister of Finance finally replied offering:

--additional annual payments that will ensure the province effectively retains 100 per cent of its offshore revenues--

Then the minister added two big exceptions limiting the offer:

--for an eight-year period covering 2004-05 through 2011-12, subject to the provision that no such additional payments result in the fiscal capacity of the province exceeding that of the province of Ontario in any given year.

The eight year time limit and the Ontario clause effectively gutted the commitment made to the people of Newfoundland and Labrador during the election campaign.

Why should Newfoundland's possibility of achieving levels of prosperity comparable to the rest of Canada be limited to an artificial eight year period? Remember in particular that these are in any case non-renewable resources that will run out. Why is the government so eager to ensure that Newfoundland and Labrador always remain below the economic level of Ontario?

The Ontario clause is unfair and insulting to the people of Newfoundland and Labrador, and its message to that province, to Nova Scotia and to all of Atlantic Canada is absolutely clear. They can only get what they were promised if they agree to remain have not provinces forever. That is absolutely unacceptable.

Hon. Stephen Harper (Calgary Southwest, CPC): Everyone in Canada would be happy if one day our Atlantic provinces could fully benefit from their natural resources, everyone except the federal Liberals.

The Liberal attitude is as typical as it is senseless. There is no point pulling back non-renewable resource revenues from a have not province. This is an opportunity and it is a one time opportunity. It is a short term opportunity to allow these provinces to kick-start their economic development, to get out of have not status, to grow this short run opportunity into long run growth and revenue that will be paid back to Ottawa over and over again and that will benefit the people of those regions of Canada for a very long time.

This is what happened in the case of my province of Alberta. Alberta discovered oil and gas in the 1940s and 1950s, Alberta was a have not province. From 1957 until 1965, Alberta received transfers from the equalization program. Alberta was allowed to keep 100% of its oil royalties and there was no federal clawback. This is what allowed Alberta to kick-start its economy, to expand and diversify, to build universities, to advance social services and to become one of the powerhouses of the 21st century Canadian economy.

Of course the Liberals expended endless effort to limit the growth of Alberta's revenues, culminating in the experience of the national energy program. Now we see already, with this opportunity in Atlantic Canada, the same attempts to limit the opportunity. The Prime Minister's Ontario cap effectively limits the maximum benefit of the offshore resource to $452 per person in the province of Newfoundland and Labrador. After that, every dollar will be clawed back by Ottawa, no matter how many billions the offshore resource turns out to be worth.

The Prime Minister, before he was here, was president of a company that largely depended on offshore activity. Does he not understand that energy resources are finite, temporary and a short term opportunity? The provinces of Newfoundland and Labrador and Nova Scotia should be allowed, indeed should be encouraged, to improve the living conditions of their citizens and to use this to attract new long term businesses to replace the temporary opportunities provided by the offshore resources.

Instead, when the Atlantic provinces rejected the latest federal offers, the caps, the limits and the exclusions, the government engaged in a clumsy divide and conquer tactic, a tactic which gave away its obvious objective of holding back the development of the Atlantic provinces. It has tried to negotiate with one province and not the other, but both Newfoundland and Labrador and Nova Scotia have made clear that their positions are the same and that they want to be dealt with fairly and at the same time.

Whether we live in Newfoundland and Labrador, Nova Scotia, Alberta or anywhere else, we are all Canadians. We all have a right to a better future. That future is not for the Liberal Party to decide to speed up or to slow down, to start or to stop. It is not to negotiate. The Prime Minister gave his word. The terms of his proposal were clear. Newfoundland and Labrador and Nova Scotia requested and were promised 100% of their offshore revenues without equalization clawback, period. There is nothing to negotiate.

What is at stake is the future of Atlantic Canada, an unprecedented and historic opportunity for those provinces to get out of the have not status that has bedevilled them for decades. What is at issue is very simple. It is the honour of the Prime Minister, and all he has to do is keep his word.

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