Why is Julian Fantino hiding his campaign donors?

Blogger The Sixth Estate has written a post drawing attention to the campaign finance filing of Vaughan Conservative MP Julian Fantino from last year's election, noting two campaign contributions of "Dinner" and "Donation" that are rather odd names you don't hear every day. And if they are names, at $117,600 and $65,585 respectively they're well over the individual contribution limit of $1100 for donations to a political campaign.

Now, oddly enough, the Fantino campaign didn’t report a postal code either for Mr. Dinner, or for Mr. Donation. I wonder why that could be. As you can see, Mr. Donation is a very wealthy person. The legal limit is well short of $65,585, but that didn’t stop him! And who paid for the dinner? I certainly hope Elections Canada has more information than we do.

Intrigued, I went over to the Elections Canada web site to take a look for myself. And I was surprised to see that under "Candidates' Details - Statement of Contributions Received (Part 2a)" the only two donations listed were, indeed, Dinner and Donations.

To say this isn't how you are supposed to complete a filing is an understatement. Donations by corporations and unions are banned, and every donation by an individual over $20 must be identified by name and the amount of each contribution. Yet the Fantino campaign filing doesn't list the name of one single campaign contributor.

It would seem likely that the Fantino campaign held a major fundraising dinner that raised $117,600, and also raised another $65,585 through donations. Yet, for some reason, they listed the totals by categories instead of the names of individual contributors and the amount each donated, as required by law. It's such a ridiculous thing to do I'm inclined to think it was sheer incompetence rather than malice, as it's not the sort of thing you could expect to slip under the radar. One look at the filing and it's glaringly obvious. And if it is malicious, at best they could hope to delay the revelation of the names of their donors by a year.

The data posted in Fantino's filing is "as submitted" and hasn't been approved by Elections Canada. It's likely that someone from Elections Canada will be in contact with Fantino's official agent, looking for the missing information. Failure to comply would seem to, at a minimum, mean no expense rebate for the campaign (a loss of tens of thousands of dollars). Fines and possible de-registration of the riding association may also be possibilities; I'm not an expert on the intricacies of election law.

In the meantime, the question remains, just who donated to Fantino's campaign and why hasn't he revealed the list of donors, as required? It it just sheer incompetence or does he have something to hide?

It bears noting, though, that while an argument of sheer incompetence is reasonable with this incident in isolation, make questions have been swirling around the Fantino campaign of late:

* Ex-Tory riding execs question Fantino's election finances

Three former members of the Conservative riding association in Vaughan, Ont., are asking Elections Canada to investigate the campaign's finances. In sworn affidavits, Richard Lorello, Tracey Kent and Carrie Liddy allege possible irregularities in Julian Fantino's 2010 byelection and 2011 election campaigns.

* Elections Canada urged to investigate Fantino

The three former riding association members allege that Fantino’s fundraising chair, Sam Ciccolini, said at a January 2011 meeting that there was a second bank account belonging to the campaign that contained more than $300,000. It is against election rules to have more than one campaign bank account.

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By-elections hit parties in the pocket book (Update: No they don't)

UPDATE: Actually, as two speedy commenters suggest, byelections don't count in the calculation of the subsidy. Therefore, ignore all of this post. At least I got to use a calculator, though. That's always fun. So if byelections did count, this is what would happen. Consider it the first in my series of alternate history blogging, a new genre soon to sweep the blogsphere. I wonder though, SHOULD the subsidies be recalculated based on byelections? Given that the mood of the electorate could well have changed, I'd argue yes, they should be.

I've seen lots of "by the numbers" analysis of this week's by-elections (Pundits' Guide is solid as usual, as is Calgary Grit) but there's one numerical analysis I haven't seen yet, so I thought I'd dive in: what it means for the major party's per-vote subsidy take.

As we know, parties earn a per vote subsidy for each vote they earn, once they reach a certain threshold. Currently, it's $1.95 per vote. The Conservatives are routinely proposing to kill this subsidy, which was introduced when corporate and union donations were banned. I have a campaign finance reform counter-proposal.

In the mean time though, the subsidy lives. How was it impacted by these by-elections? Well, since by-elections tend to have lower turnout, everyone tends to lose votes, and dollars, after by-elections. And this week's were certainly no exception, with every party finishing with fewer votes in totality. There were too exceptions on the riding level: the Conservatives gained 530 votes in Vaughan, and the Liberals am impressive 5,288 in Winnipeg-North. But those gains were more than offset by loses elsewhere.

Here are the riding-by riding figures, with the vote change from 2008 and the corresponding subsidy impact:

Vaughan
CPC: 19,920 (+530) +$1,033
LPC: 18,236 (-9537) -$18,597
NDP: 661 (-4770) -$4,768

Winnipeg North
LPC: 7,303 (+5228) +$10,194
NDP: 6,490 (-7607) -$14,833
CPC: 1,647 (-3386) -$6,602

Dauphin--Swan River—Marquette
CPC: 8,176 (-9945) -$19,392
NDP: 3,785 (-1089) -$2,123
LPC: 1,481 (-2603) -5,075

As we can see, while generally (with two exceptions) all parties lost votes, largely due to voter turn-out, those parties that saw incumbents resigning took the biggest hits in each case, even when the party of the incumbent was re-elected. The departures of Maurizio Bevilacqua, Judy Wasylycia-Leis and Inky Mark each really hurt their respective parties. Meanwhile, Alf Apps should really buy Kevin Lamoureux a beer tonight as his victory wasn't only unexpected, it was profitable.

Now, the overall results, with vote change from 2008 and corresponding subsidy impact:

NDP -13,466 (-$26,258)
CPC -12,801 (-$24,961)
LPC -6912 (-$13,478)

As we can see, everyone lost votes and, therefore subsidy dollars as a result of the by-elections this week.

The Liberals can at least claim a moral victory for having lost the least, thanks in large part to Lamourex's big swing in Winnipeg-Centre, but with budgets tight at party central this loss will definitely be felt. The Conservatives lost nearly twice as much, but as their subsidy take was bigger to begin with and they have a large edge on direct fundraising, it won't really hurt them too much. The biggest loss was taken by the NDP, and they'll probably feel the loss the most as well, as they've ramped-up their spend since the introduction of the per-vote subsidy.

*If I've gotten the math completely wrong somewhere, my apologies in advance. I was always more of an arts guy.

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Debate on political financing methods spreading

It was good last week to see more debate in broader circles around the ways we should be funding the political system in Canada, and possible reforms. Things got kicked-off by a column in the Globe and Mail from Jeffrey Simpson, where he largely echoed an argument I made earlier in favour of ending the per-vote subsidy but raising individual contribution limits:

If we want parties to be healthy, they need money to do their work. And if we don’t want public dollars to help them, then individuals should be encouraged to give what they can to fill in the public subsidy – which will mean raising the individual limit above $1,000.

That’s the fair tradeoff: End the public subsidy, all right, but raise the individual contribution limit.

Alice Funke of The Pundit's Guide also weighed-in with her usual detailed statistical analysis, examining the dependency of each party on the subsidy and noting that rumours of the BQ's likely death without the subsidy are largely exaggerated:

The Bloc raises enough at the riding and candidate level each year alone to run fully funded campaigns after the candidate rebates, and yet it is able to win fully two-thirds of the province’s seats spending on average less than two-thirds of the limit in each constituency. Combining the riding-level surplus with its central fundraising would still allow that party to adequately finance its central campaign, after the central rebate is taken into account. We also know it costs significantly less to run a campaign across a single province in a single language than it does to run a national and bilingual one.

It's good to see more detailed, substantive debate happening on an issue that, in the past, has largely been confined to the Conservatives threatening to pull the subsidy and then everyone speculating if the opposition will risk an election over it or not, instead of an examination of the merits of different funding regimes.

You can read my original post on the topic here, but in a nutshell my argument is quite similar to Simpson's: end the per vote subsidy but raise the individual donation limits while keeping the union and corporate bans in place. Dan Arnold has also weighed-in on the topic.

I should clarify my original argument a little, as it was seen by some as a partisan argument for a system designed to best advantage my party and disadvantage it's opponents. Obviously that's true in a sense; I'm a partisan, guilty as charged. But that wasn't the main point of my argument; it was more about strategy.

I was trying to say that if the Conservatives keep trying to push ending the subsidy as a wedge-issue we should outflank them by counter-proposing ending the subsidy but only with raising individual limits. To those who say we shouldn't be funding political parties with tax dollars, this is a perfectly reasonable counter-proposal that can't be dismissed out of hand.

The Conservatives would either a) back away because such a scheme would likely see the Liberals recover their fundraising levels (which they don't want), ending the move to kill the subsidy and maintaining the status quo b) accept the proposal, increasing the fundraising capacity for all parties (but strongly benefiting the Liberals, who have relied on larger donations), or c) reject the counter-proposal and carry on trying to end the subsidy with no other changes to increase capacity, which would expose their strategy as having nothing to do with principle and everything to do with partisanship, which won't play well with John Q Public.

That's what I was trying to argue with my initial post: a political strategy the Liberals could employ to neuter one of the big wedge issues the Conservatives have continually been threatening to employ, and indeed have in the past (see the fiscal update/prorogation drama.) It's also one that would resonate with the libertarians amongst the CPC.

Putting aside the politics, I have nothing against the per vote subsidy and would be fine seeing it continue. However, if it is ended I believe it is only fair to increase the fundraising capacity of all parties by raising the individual donor limit. And even if the per vote system remains, I do not believe their is a reasonable argument to be made for capping individual donation limits at $1100. I think they should be closer to the older $5000 level.

I accept the argument for banning union and corporate donations. But I say if a private individual has more than $1100 and wants to use it to support a political party or parties, they should be free to do so and you need a pretty strong argument to restrict them.

I don't accept the argument that someone donating between $1101 and $5000 would be gaining undue and improper influence with a government or politician. Frankly, if someone can be bought for so little, we have much bigger problems to deal with. And with all donation information being posted online, and with other tools such as the lobbyist registry, there is plenty of transparency to see who is donating what and if it is leading to anything improper. I'd rather have strict controls to identify and punish abusers than punitively restrict everyone. And $5000 should be a low-enough limit to keep such fears at bay.

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Why the Liberals should support ending the per-vote subsidy

A report in La Presse confirms the Conservative government’s (oft-stated) intention to end the per-vote subsidy to political parties. This frightens many Liberal nervous nellies. I think this is an opportunity for the Liberal Party to make a bold move, however. The Liberals should support ending the subsidy, but with one significant addition: raise the limit on personal donations to $5000.

I would like to see the Liberals reframe this debate and seize the agenda by proposing its own political financing legislation: end the per vote subsidy but raise the limit on personal donations from $1100 back up to $5000. Union and corporate donations would remain forbidden.

On the per-vote subsidy, ending it wouldn’t be the calamity for the Liberals many think it would be. At least, it wouldn’t be as mad for us as it would be for others.

The party that would be most hurt by losing the subsidy would be the Bloc Quebecois. The BQ relies on the subsidy for nearly all of their budget, and since they only need to campaign in Quebec, it allows them to run a very strong campaign with barely any fundraising.

The next party that would be most hurt by ending the subsidy would be the NDP. They’ve dramatically escalated their election and between-election spending since the creation of the subsidy, spending at levels they never had before, thanks to the per vote subsidy. Ending it would require a major scaling-back of their budget, and the size of the campaign they could run.

Now, I won’t say the Liberals wouldn’t be hurt. Losing the subsidy would be a blow, without a doubt. Significant adjustments would have to be made (and getting a little leaner wouldn’t necessarily be a bad thing). But the fact is we are less reliant on the subsidy than the other opposition parties, and we have been getting (very slowly) better at fundraising.

I am, though, proposing one major change to be coupled with ending the subsidy: raising the personal donation limit to $5000, where it was before the Conservatives and the NDP conspired a few years ago to lower it down to its current level (around $1100), primarily to try to handicap the Liberals.

I think we can make a strong case for restoring it for a number of reasons.

One, public financing was brought in when Jean Chretien’s government ended union and corporate donations, the argument being if you’re going to remove that fundraising capacity from the parties you should give them an alternative, and a small public fee to end the corporate and union influence in politics is a small price to pay. The same holds true here. If you’re going to remove the public subsidy, you should give parties the capacity to be able to replace that funding. That’s an argument of fairness I think will resonate with the public.

Two, why should the government be able to restrict my ability as a private citizen to support the political party of my choice. While I do support reasonable limits (and I think $5000 is reasonable) there are many people who believe money is speech, speech should be unlimited, and the government has no right to abridge the people’s right to speak. One of those people is Stephen Harper. As head of the National Citizens coalition, he argued stridently for the right of third-party pressure groups to spend anything they want, free of election spending limits. He even took it to the Supreme Court in Harper v. Canada. We should ask Harper, if money is speech, why does he believe in free speech for lobby groups but not for individuals?

Ending the subsidy coupled with raising the donation limit would be a win-win for the Liberals. We would regain our fundraising capacity and emerge stronger than before, and able to capitalize on the impact it would have on the other opposition parties, particularly the BQ in Quebec, where under Stephane Dion we actually gained seats in the last election.

Even more than that though, it would be a bold proposal that would reframe the party financing debate and force the Conservatives onto the defensive for a change. The opportunity is there, if we’re bold enough to seize it.

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A counter-proposal for campaign finance reform

Last week, as the Conservatives opposed the Liberal motion to end out of riding ten-percenter junkmail, then supported it, then opposed it, and then supported it if everyone else supported it (it was among the many Conservative flip-flops last week), they also threw out what many in their camp believe to be a clever ploy: a threat to bring back their attempt to end the per-vote subsidy for political parties.

They’ve since apparently backed off yet again, but I’m sure this threat will be back at some point, possibly as a preferred election trigger to the Afghan detainee document file. After all, would you rather go into an election over withholding documents that would seem embarrassing to your government, or over trying to stop public money from going to political parties? Not a hard choice.

It’s all about politics, of course. The Conservatives do get more real dollars from the subsidy than the opposition parties, because they’ve gotten more votes the last few elections. They have a more robust fundraising operation, though, so dropping the subsidy wouldn’t be as big a hit for them. But the subsidy is a much larger percentage of the budgets of the opposition parties, so really, for the Conservatives this is more about screwing their opposition than it is about democracy.

That’s been par the course on this file for years. In his last days in office, Jean Chretien moved to end corporate and union donations. The Liberals having relied heavily on corporate donations, he left his successor, Paul Martin, with a huge challenge. Chretien brought in the per-vote public subsidy though to compensate for the loss of corporate and union dollars, rightly seeing $1.75 from every voter as a small price to pay for a democratic system freer of corporate and union influence. Then, after the Conservatives came into office, they teamed-up with the NDP to pass a further reform of political financing, again aimed at causing the Liberals grief. Knowing that the Liberals relied on a small number of large donors, as opposed to a large number of smaller donors, the Conservatives, with NDP support, moved to lower the personal donation limit from around $5000 to, today, $1100. They also did it in the middle of the 2006 Liberal leadership race, helping create a mess that still continues today for candidates that budgeted for one set of rules only to have them change mid-campaign.

Since that time, the Conservatives have been routinely making noise about moving to end the per vote subsidy. It has been part of their long-term goal to destroy the Liberal Party as a viable opposition (some would question if we’ve been needing help on that) by bankrupting their opposition. They included such a move in the fiscal update that triggered the coalition crisis, but later backed down. Ironically, by also doing nothing on stimulus or the economy they gave the opposition cover to oppose them; if they’d just done the subsidy dump it would have been hard to risk an election on that issue.

Since that time, though, while there’s still a long ways to go, progress by the Liberal Party in reforming its fundraising machine means that today, the end of the per vote subsidy wouldn’t be the death knell it once was. It would be a handicap, but one that could be overcome. Actually, the party that would be most hurt by the end of the subsidy would be the NDP, which has increased its spending in recent years thanks to the resources provided by the subsidy. It’s ironic, because the Conservatives need a strong NDP to sap Liberal support on the left, so ending the subsidy would be counter-productive to Conservative goals. Ending the subsidy would also hurt parties not in the House, such as the Green Party, that have benefit from per vote subsidy because of their dispersed support across the country.

Still, if the Conservatives insist in trying to kill the per vote subsidy, particularly if they try to do it as a wedge to force an election, I’d like to put forward a counter-proposal: end the subsidy, keep corporate and union donations banned, but raise the personal donation limit back up to $5000.

There was no good reason to lower the cap in the first place. I find it a hard circle to square that Stephen Harper can argue that money is speech when he went to court to fight against third-party election advertising, but he’s willing to abridge the rights of individuals to contribute to the party of their choice. If he wants to end the subsidy, raising the personal limit would be a way to give parties more capacity to compensate for that loss, and would be a difficult move for the Conservatives to argue against effectively and persuasively.

*I’ll be travelling and offline today and throughout the week, so expect some delay in comment approval.

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Someone teach the National Post basic business journalism please

I’m a business journalist in my day job, and while today my reportage is more technology and marketing focused, back in the day I used to have to do a lot of spot reporting on company earnings. Wade through a mess of confusing numbers and acronyms – EBIDTA, GAAP, one-time charges, revenue, income, currency charges – and quickly discover the facts, what’s newsworthy and why, and report it.

And I tell you, if I got it as wrong as the Post did here, I’d be fearing for my job. Their analysis/link they try to make is completely off base and without merit, and is completely unsupported by the facts. With the Post’s death rumoured in recent days I’ve been defending them; not because they occasionally publish my commentaries but because I think we need more media organizations in this country, not less, because as a journalist I support jobs for journalists, and because off the op/ed pages, generally the Post is no more or less biased than any other outlet. But pieces that are completely full of crap like this one make it difficult to do so.

First of all, they rely on a Q2 2009 to Q3 2009 comparison as the main plank to support their thesis: dropping Liberal polling equals dropping Liberal donations. Ask any business journalist, financial analyst or accountant and they’ll tell you comparing consecutive quarters is largely meaningless. That’s because business is seasonal, it’s cyclical. So comparing, say, a department store’s Q4 vs Q1 next year revenue will likely show a big drop always. Why? Because Christmas is in Q4, and it’s a major shopping season. Sales always taper off in January.

That’s why comparing consecutive quarters is meaningless, and it’s why instead it’s standard practice to compare to the year-ago quarter. So, comparing Q4 this year versus Q4 last year and you’ll be comparing two like shopping seasons, giving you a better trend line to judge performance.

Second, if you want a true apples to apples comparison you need to look for and exclude one-time expenses or revenues. A company might take a big hit in one quarter because of a fine, for example. Or realize a big one-time gain because of an asset sale. Comparing numbers without factoring-out one-time numbers gives you a meaningless conclusion.

Anyway, here’s the Q2 to Q3 numbers as Tweeted by Canwest’s David Akin:

Q309/Q209 #cdnpoli Contribution $ only: #BQ -50% #CPC -5% #GPC +14% #LPC -50% #NDP +57%

As I said, comparing consecutive quarters is largely invalid, and there’s one major factor the Post missed in drawing the conclusion they did from these stats (I don’t quarrel with Akin here, he’s just reporting the numbers): the Liberals had a huge one-time revenue boost in the previous quarter: the Vancouver convention. Over 2000 people at up to $1000 bucks a pop. That skews those numbers.

Of course, they dropped from that quarter’s result, and it had little to nothing to do with polling: it had everything to do with not having a major national convention every quarter. To not factor that in is misleading, dishonest and just plain crappy reporting.

That aside, let’s look at the Post’s wider conclusion: that Liberal polling decline = Liberal donation drop. That’s only supportable if you ignore the methodology flaws already noted and look at just the LPC numbers in isolation. But their theory doesn’t hold with the other numbers. The Cons shot-up in the polls, but their contribution numbers dropped 5%. The NDP tread water in the polls at best, and they went up 57% in contributions. Their thesis just doesn’t make sense, even if you ignore the other obvious flaws in their supporting data.

Now, all that said, what happens when you do the comparison that is generally accepted practice in business, and compare to the year-ago quarter? Here is Akin’s tweet for that number:

Q309/Q308 #cdnpoli Contribution $ only: BQ -92% CPC -41% GPC -67% LPC +5% NDP -41%

Well, that’s a very different number isn’t it? Remember, we were fighting an election in this quarter a year ago, usually good for a nice fundraising boost. So it’s unsurprising the Conservatives and NDP are both off by 41%, year over year. Again, one-time rev boost in the year-ago quarter.

Nonetheless, that rev boost this time was available to all the parties, not just one (unlike the LPC convention) and yet only one party is not down sharply year over year. Indeed, only one party is actually up year-over-year for Q3, despite not having an election boost this year: and it’s the Liberal Party, up 5%.

So that just takes the Post’s theory and proves it to be completely full of crap. The LPC has fundraising momentum. There's a long ways to go to match the Conservatives in sheer volume, but the trends remain positive.

Now, could poor polling make it difficult to raise money? Absolutely. It will definitely make it harder, and things need to turn around on the polling front. But as much as the Post may wish to twist the laws of accounting, basic business sense and, well, reality to make it so, there’s nothing in the donation figures to show that has happened yet.

P.S. Visit Pundit Guide for a more non-partisan take.

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Are the Conservatives forgetting their Flanagan?

According to the Winnipeg Free Press, the Conservatives have deputized "democratic reform" minister Steven Fletcher to lead a new charge to end the per-vote subsidy for political parties.

As the article rightly points-out, such a move would no longer mark the financial death-knell of the Liberal Party of Canada. Under the leadership of Alf Apps and Rocco Rossi the party's fundraising machine has been reinvigorated, and the subsidy is no longer the lifeline it once was for the party.

Still, I'm not necessarily ready to support its elimination. When the Liberal government of Jean Chretien brought-in the subsidy, it was to counter the elimination of corporate and union donations, which cut-off a major source of funding to political parties. The Conservatives tightened the taps even further, by sharply limiting personal donations from around $5400 to today's cap, which IIRC is around $1100.

I remember when Stephen Harper argued money was speech and shouldn't be constrained, but I won't digress. I'll just say that I may me amenable to re-visiting the per-vote subsidy were such a move coupled with a significant increase in the personal donation limit. I think that would be a fair compromise.

But what led me to blog on this issue though was this graph from the Free Press article:

As well, the Conservatives cutting off the vote tax would not cripple the Liberals finances but would hamper the NDP and Bloc Quebecois, both of which earn more from the vote tax than from donations.

And that would be bad news for the Conservatives, whose victories are in part due to the splitting of votes on the centre-left of the political spectrum.

That's a very good point. Strategically, it's in the best interests of the Conservatives to ensure a strong NDP. That's Flanagan 101. A strong NDP pulls votes from the Liberals (not saying the Liberals own those votes or anything, just that they draw from the same well) which creates splits that help elect Conservatives. Battleground Ontario is a good example of this. A number of recent Ontario polls have pointed to Conservative losses in the 905, driven in part by Liberal strength and coresponding NDP weakness. That's a bad picture for the CPC.

So while going after the per-vote subsidy might have made good strategic sense for the CPC when the LPC was a fiscal basketcase, today you could argue it would actually be strategically counter-productive for them.

Of course, there is the chance this is about what's right for the CPC, and not strategic positioning and sticking it to their opponents.

Hey, there's a first time for everything.

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In and Out scandal is in again

In case you've fogotten, the Conservative Party are still in court with Elections Canada, trying to squeeze more money out of the taxpayers they're not entitled to, as part of the In and Out scandal.

According to CP, Elections Canada has filed its final argument in the case with the court, an argument CP calls "hard-hitting" that provides morre details on In and Out, which Elections Canada calls a "scheme."

``Senior officials in the party appear to have determined that the party's legal spending limit would not allow it to spend as much as it wished on its national advertising program,'' says the brief by lawyer Barbara McIsaac.

The 64-page document cites party emails, as well as memos and email correspondence with the agency that placed the ads, to argue the expenses were actually incurred by the party rather than 67 candidates who claimed them as their own.

The court submission calls the ad program a ``scheme.'' Party headquarters transferred tens of thousands of dollars into the campaigns of individual candidates, who had agreed beforehand to transfer the money out of their campaign accounts back to the party as payment for their purported share of the ad costs.

(snip)

The brief emphasizes Mayrand's argument that candidates, as well as the party, were unable to provide evidence that the candidates, not the party, incurred the advertising expenses and arranged the contracts with Retail Media.

It cites a new affidavit from an Elections Canada investigator that quotes party emails saying senior Tory officials were concerned in December 2005 the party was running out of room within its legal spending limit for the lengthy campaign.

The brief says Public Works Minister Christian Paradis would have exceeded his spending limit by more than $7,000 had the party not given him an unexplained credit of $10,000 for his share of the ad spending.

Former foreign affairs minister Maxime Bernier would have exceeded his spending limit had his invoice also not been reduced and had he been charged production costs like the other Quebec candidates.

For background, the court case was launched by the Conservatives to appeal the Elections Canada ruling that Consevative candidates weren't allowed to claim this national advertising as a local expense, and therefore claim a rebate for it from the taxpayers. They're going to court to overturn Elections Canada, and get hundreads of thousands of dollars from the taxpayers they're just not entitled to.

This court case is seperate from the ongoing investigation by Elections Commissioner William Corbett, which sparked the RCMP aid of Consevative Paty headquarters.

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Piss off the Conservatives and donate to the Liberals

Maybe this ending public party financing thing is a Machiavellian plot to destroy the Liberal Party. Maybe it’s a Machiavellian plot to distract attention from the fact the Conservatives (the highest spending government in Canadian history) have needlessly spent us into deficit. Maybe it’s a Machiavellian plot to distract attention from the fact the Conservatives will today announce no meaningful economic stimulus package, despite the cries from the provinces, business, economists, and, well, everyone, to act now.

Myself, I think it’s a combination of all of the above.

Things will play out how they play out. There is one thing we can do ourselves though. And that’s send Stephen Harper a message by making a donation to the Liberal Party today. Doesn’t need to be a lot, every little bit helps. But lets all donate a little something today to send a message to the Conservatives.

Or, better yet, join the Victory Fund. The minimum is just $10/month, with half going to to the party and half to the riding association of your choice.

As I’m already a Victory Fund member, I just made a $25 donation to the Liberal Party. I encourage you to do the same this afternoon. And after you make your donation, you can make a post in this Facebook event page to add to the total. And you can join this Facebook group to support the public financing of political parties.

Wouldn't it be great, when the next quarter donation information is released, to see a surge of donations by Liberals from across Canada on the day Harper and Flaherty made this announcement?

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In and Out video released: RCMP Raid Conservative HQ

As we prepare to go to the polls in this election, its important to remember what happened in the last election.

In the last election, the Conservative Party hit their legal limit in national advertising spending.

The Conservative Party then transferred hundreds of thousands of dollars to various local campaigns where their candidates were not competitive and weren't going to spend their legal maximums.

The campaigns were told the money had to be used to buy advertising that was identical to their national ads, save tiny tiny fine print.

The central party would buy the ads. The local campaign would have no say.

The money was transferred right out of the riding to pay for the ads immediately after it was transferred in.

The "In and Out" scheme allowed the Conservatives to get around the spending cap for national advertising.

The "In and Out" scheme allowed the local campaigns to increase their expenses, and therefore their taxpayer-funded refund from Elections Canada.

These facts are not disputed by the Conservatives, the opposition, or by Elections Canada.

Here's where they defer: the Conservatives say this was all perfectly legal. Elections Canada says not so much.

Elections Canada launched an investigation into the advertising scheme that is still ongoing, and told the Conservative campaigns it was ruling that those ads were not legitimate local expenses, and therefore didn't qualify for a taxpayer refund.

The Conservative Party, unhappy with the ruling, launched a lawsuit to overturn the ruling by Elections Canada against it.

There are two separate processes: the investigation by Elections Canada, and the lawsuit by the Conservative Party.

As part of the Elections Canada investigation, earlier this year the RCMP, on behalf of Elections Canada, raided Conservative Party Headquarters. It was an unprecedented action in our parliamentary democracy for a police raid to be necessary to obtain documents from a political party.

The following compelling video of some of the latter stages of that raid has recently been posted online:



As we go into this election, a few more things are worth remembering:

*The Conservatives still insist they did something wrong. Election law says differently.
*The Conservatives haven't sworn off doing the exact same thing this election.
*The Conservatives have constantly undermined the impartiality and credibility of Elections Canada, a non-partisan institution whose head was appointed under the Conservative government and who is called upon by nations around the world to advise on conducting elections.
*The Conservatives refused to cooperate with attempts by parliamentary committees to probe their In and Out scandal. They stone-walled committees. They filibustered. And they encouraged witnesses not to cooperate.

That's not leadership.

FROM THE ARCHIVES:

*Globe In and Out editorial is the farce
*In and Out day two, a few textual thoughts
*In and Out hearing video highlights
*More than election law, In and Out is about $720,000 of our money
*This is a party with nothing to hide?

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Globe In and Out editorial is the farce

The learned minds of the Globe and Mail editorial board are in full tut-tut mode today, wagging a disapproving finger at “all parties” for making a farce of the last round of ethics committee hearings into the Conservative Party’s In and Out scandal, and chastising Liberal committee chair Paul Szabo for issuing 31 summons for witnesses ahead of next week’s hearings.

In issuing an astounding 31 summons for apparently reluctant witnesses - some of them senior Conservative operatives and officials - to appear at hearings that restart next week, Mr. Szabo has made terribly gratuitous use of his powers. And in sanctioning him to do so, the committee's opposition majority has all but ensured that the hearings will take on an even more adversarial tone than before, particularly when partisans are not just asking the questions but also answering them.

But hey, before you get too upset, the Globe does reluctantly admit that maybe, just maybe, a bunch of senior Conservative Party officials refusing to cooperate with a parliamentary committee, forcing the committee to resort to summons, might not be totally the Liberal Party’s fault:

But the Conservatives have to bear some of the blame. The party should have respected the authority of Elections Canada to investigate alleged improprieties during the 2006 election campaign, when the Tories may have inappropriately funnelled national campaign expenses through individual ridings. Instead, they have done everything in their power to undermine the agency's credibility - claiming without evidence that it is on a partisan crusade against them. In so doing, they have invited the opposition to take a stronger interest in the matter than they otherwise would have.

I don’t know, maybe it’s the fact the Globe editorial board endorsed these clowns in the last election, maybe they’re feeling buyer’s remorse. Maybe they’re interpreting fair and balanced to mean taking shots at all sides, whether they make sense or not.

But to attack Szabo for making “terribly gratuitous use of his powers” is ridiculous. He was forced into this action by the Conservatives, and their refusal from Day One to cooperate with either Elections Canada or parliament on investigations into their alleged scheme to circumvent election spending limits and enrich campaign coffers at taxpayer expense.

The Conservatives stonewalled in committee after committee, delaying these hearings for many months. When they came, they mercilessly attacked the integrity of an officer of parliament appointed under their watch, whose name they put forward. And about this next round of hearings, it’s the Conservatives that have refused to have their MPs testify (and MPs can’t be summoned). And I have little doubt they put the word out their officials on the witness list to refuse to voluntarily comply with the requests to testify, forcing Szabo to go the summons route.

This is the party of accountability and transparency that you endorsed, Globe editorial board.

Why are the Conservatives refusing to cooperate with parliament? Why did they force summons? And why won’t their MPs testify? Those are the questions they should be asking, and the actions they should be condemning. Blaming Szabo is like making the fireman share the blame with the arsonist.

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In and out day two, a few textual thoughts

I'm feeling under the weather today so I'm home sick, and after a morning of rest I've been drinking plenty of fluids and watching the ethics committee hearings in the Conservative In and Out election financing scandal on CPAC.

I missed most of the morning session, but then I hear so did CPAC. They did replay the morning session during the lunch break though, and so I caught most of that and then the afternoon session.

From what I can gather most of today's activities were bogged-down in procedural wrangling. Not overly exciting viewing unless you're a bit of a parliamentary procedure wonk and Roberts Rules fan. Which I am of sorts, so I found it all mildly entertaining.

Elections Canada boss Marc Mayrand was dismissed early around midday, although not before the Conservatives complained bitterly about sending him home early. Hard to believe there was a time they didn't want much to be here, now they don't want to leave. The wanted another 8 rounds of questioning at least, while the other parties seemed to be done. The Cons though claimed to have tons more blockbuster questions that, if they could only ask them, would blow the lid on the grand conspiracy about how Elections Canada, the Liberal Party and the Stone Cutters are all out to get the Conservative Party.

The problem is, their questions were are are all outside the scope of the terms of reference the committee has agreed to for the hearings, or they relate to the court case launched by the Conservative Party themselves (actually several of their candidates' official agents to be specific) and so can't be addressed by Mayrand.

If the Conservatives really had any blockbuster questions they would have asked them during the day and a half of questioning. Instead they spend the time flailing asking irrelevant questions trying to support their conspiracy theories and failing spectacularly. On day one, Mayrand indicated clearly he instructed his officials to investigate if there were other returns (filed by candidates from other parties) in the last election of a similar nature. There were not.

And the Conservatives have yet to provide any conclusive evidence that there were. They've been fishing for months and they've come up empty. They keep harping on transfers made by the BQ that are similar. This is true. But it was also during the 2000 election, when the law was different. The courts have upheld the legality of those transactions.

The Conservatives though ignore the law (which they seem to do a lot) and try to create a smokescreen to support their utterly discredited “all parties do this” thesis. A rational examination of their case though shows their claim to be groundless. And by the way, let's say there was something here, why would the Liberals want to hide alleged BQ wrongdoing? Doesn't make sense.

They also have some supposed evidence against the NDP's Libby Davies that is similarly uncompelling. The best they can do against the Liberals is to complain that Elections Canada didn't investigate the sponsorship scandal. Yeah, that whole thing was ignored wasn't it? Unless you don't count investigations by the HoC Public Accounts Committee, the RCMP, forensic accountants, and a Judicial Commission of Inquiry televised on national TV.

After lunch it was on to discuss the next round of hearings on In and Out in mid-August (mark your calendars now for the week of Aug. 11) and who the potential witnesses will be. Each of the parties submitted names in the morning, the duplicates were purged and the list is to be considered by the committee.

Ethics is one of the few committees where both the chair is from the opposition and the opposition MPs have a majority, and it looks like the opposition has been able to secure a few pages from the infamous Conservative Big Book of Committee Trickery. The chair, Liberal Paul Szabo, rules a bunch of proposed names as out of order as they're outside the committee terms of reference as discussed above.

Before the Conservatives can contain their rage enough to object (as pretty near every name disallowed was from their list) Liberal MP Marlene Jennings breaks-in with a non-debatable challenge the chair motion.

Why would Jennings challenge the chair, I'm thinking. But it's all perfectly clear, as the Conservatives quickly shout in protest: it's Liberal trickery! The NDP and BQ join in the Liberal trickery and uphold the chair's ruling. Debate on the ruling pre-empted, the exclusion is a done deal.

The NDP's Pat Martin moves a motion to invite the remaining witnesses with the exception of Robin Sears (ex of the NDP, more recently an advisor to Brian Mulroney, and defender of In and Out) whom he moves be struck from the list.

At this point, to their chagrin, the Conservatives realize every single name on their proposed witness list has been struck, with Sears being the last one. Ha. Well guys, that's because all the names have one thing in common: they have nothing to do with the committee terms of reference, and everything to do with your diversionary and irrelevant fishing expedition. So it's hard to have much sympathy for them.

Jennings for good measure moves to strike a few more names that the Cons didn't submit, and amends the motion to let the chair compel some witnesses to appear if necessry. This is no doubt aimed at some of the senior Conservative Party strategists on the list who are unlikely to be energetic witnesses. Also on the list are many Conservative MPs flagged as taking part in In and Out. They can't be compelled though, and Pierre Poilievre makes clear they won't be coming to this “kangaro court.”

The motions pass, and Jennings quickly moves to adjourn, which is passed. Conservative MP Scott Reid has some motion (of which I don't know the details) that was left on the agenda and he seems pissed it won't be heard. I don't blame him, although if it was a stupid motion I reserve the right to change my mind.

Anyway, Reid et. al. leap to their feet in anger as CPAC cuts the mic to end coverage, and can still be seen shouting as the screen fades to the accompaniment of classical music. The juxposition makes me smile. And I might feel bad for them had they not made a history in this parliament of using every bit of the procedural handbook to their committee advantage. Sauce for the goose, Mr. Saavik.

Of course, for the definitive live-blogging coverage see Inside the Queensway.

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In and Out hearing video highlights

With yesterday's In and Out testimony at the ethics committee yesterday I decided to take my first crack at video blogging, and make a video with some of the highlights of the testimony and my comments. The result follows:



I'm not overly happy with how it turned out. My camera and mic are pretty poor quality, I was plagued by technical difficulties, and I need some better editing software. After spending too much of yesterday evening playing around with it I just decided to call it a day and go with it as is. It's a first attempt though, I'll try some different things in the future and get it right hopefully one of these days. And of course I should have been saying Mayrand, not Maynard.

For more on day one of the hearings, visit these links:

MSM
Toronto Star: Tory party violated rules, MPs told
CBC: Election chief counters Tory defence on election expenses
CP: Electoral officer tells MPs of $1.3 million in suspect Tory campaign expenses
Toronto Sun: Vote czar zaps Tories

BLOGS
Liberal Arts and Minds: From fact to fiction with a sprinkling of funny
Far and Wide: Everyone doesn't do it
Impolitical: Heckuva job, Pierre
Accidental Deliberations: On fabrications

And for the definitive live blogging coverage:

Inside the Queensway: In and Out Inside Out: Liveblogging the Ethics committee and And now, a very few pointed questions from the audience: Liveblogging the Ethics committee's afternoon session

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Conservatives in glass houses

I know ethical and ideological consistency is a foreign concept to most Conservatives, but you’d think before attacking Liberal leadership candidates over issues around leadership debt repayment under a restrictive system designed to make it more difficult they might want to ensure there are no pots in the closet that might rudely call their kettles black.

For example, this was the eight-year-olds in the Con war room in a release last week(And again today) :

Since his last filing deadline Mr. Dion has refused to let Canadians know exactly how much of this debt he has yet to pay off. Now, Elections Canada’s June 2nd deadline to pay off that leadership debt is drawing near.

(Emphasis mine.) That’s misleading; all the candidates have met their proscribed disclosure requirements and have regularly revealed all the details of their debts, and the names of all donors. And speaking of refusing to let Canadians know things, Stephen Harper has refused:

*to fully reveal who bank-rolled his 2002 campaign to become leader of the Canadian Alliance.
*to reveal exactly how much was paid to Ezra Levant in 2002 to get him to step aside from the Calgary Southwest nomination so he could run in a by-election.
* to make Peter Mackay reveal the identity of the single donor who paid off his $500,000 leadership debt.

Perhaps the Conservatives should answer some of those questions for Canadians before they get all high and mighty about Liberal leadership debt.

They won’t though. In addition to deliberately misleading Canadians about election law and the meaning of the June 2^nd deadline, which is really unsurprising as they seem to run afoul of elections law so regularly themselves they clearly don't understand it, they appear to be set to raise the stakes a notch higher:

But Poilievre signalled that the Tories will use any extensions to accuse Elections Canada of giving Liberals "preferential treatment'' and helping them break the law.

(Emphasis mine again.) Don’t wait Pierre, please don’t wait. Accuse Elections Canada of helping us “break the law” now. Accuse the Liberal Party of breaking the law. Do it today. Then we can sue your asses off, and use the proceeds to pay off all the leadership debts. Problem solved!

Anyway, Conservative histrionics aside, on the leadership debts issue I pretty much agree with Steve in terms of where Dion's priorities should be though. Now would be a food time for the party to come together and knock this thing off though. And with some of the heavy hitters that supported other candidates now onboard to help fundraise, I’m sure the Dion debt will be retired in due course, as required and allowed by law. And even sooner if Pierre Poilievre runs his mouth off.

UPDATE: This CP story mercilessly exposes the absolute hypocrisy of the Conservatives and Pipsqueak Pierre Poilievere on this issue and is a must read. It seems the Conservatives are just as "guilty" of the alleged offense they seem to have convicted the Liberals of. And then some.

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More than election law, In and Out is about $720,000 of our money

Throughout all the coverage around the Elections Canada investigation into the alleged Conservative in and out scheme, the RCMP raid on CPC headquarters, the alleged attempts to circumvent election spending limits, allegations of forgery and lack of confidence in independent democratic institutions, it’s important to keep one thing in mind: it’s also about taxpayer dollars.

Particularly when Deceivin’ Stephen Harper is making completely off base comments like this:

To that end, he mocked the Liberals and the Bloc Québécois in a speech to an evening party rally where he called the Liberals crooked and the Bloc impotent. About 400 party supporters, including two dozen area candidates, were in attendance.

"We spend our own money, the Liberals spend stolen money," he said in a speech that made no reference to current allegations of election spending irregularities by his party in the last election.

First of all, what stolen money Steve? I think we should serve him with a libel notice unless he can back that up because, as he knows, if he’s referring to sponsorship he knows the LPC returned to the taxpayers every penny that was identified by multiple independent investigations having ended-up in Liberal coffers. (And on a side note, interesting to compare the responses of the two parties to those incidents: The Liberals call in the AG, call in the RCMP, hire forensic auditors and appoint a judicial inquiry. The Conservatives stonewall committees, sue independent bodies, insult the RCMP, and vote no confidence in Elections Canada.)

And second, on his comment that the Cons spend their own money, I call bullshit. A key part of their in and out scheme was to enrich local Conservative campaigns with taxpayer money they’re not entitled to. By funneling this national spending through local campaigns, it allowed these local campaigns to increase the rebate of election expenses they’re entitled to from the taxpayers. This wasn’t a side benefit or an afterthought, it was spelled-out by the CPC to local campaigns as their carrot for participating in the scheme: we send you this money, you send it back, you get a bigger rebate.

In fact, this is such a central part to the Conservative scheme that, when Elections Canada rightly denied 67 Conservative candidates’ attempts to count this spending towards their taxpayer rebates, on the grounds national expenses aren’t eligible, the Conservatives launched a lawsuit against Elections Canada to fight for the money.

So Steve, this IS about the CPC wanting to spend taxpayer money it’s not entitled to. It’s about a scheme that, in addition to allegedly being an attempt to circumvent election spending laws, is also an attempt to squeeze another $720,000 out of the taxpayers for Conservative campaigns. Money that, told they’re not entitled to, they’re suing to get anyway.

Because, I suppose, they feel entitled to their entitlements.

People don’t generally get too upset about election spending limits. But a transparent attempt to grab nearly $1 million in taxpayer dollars? That’s another matter altogether.

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This is a party with nothing to hide?

For a party that continues to vehemently insist on its innocence, the Conservatives are certainly acting like they have something to hide. The events of Sunday afternoon, from secret clandestine meetings, to misleading the media, to sneaking out stairwells, certainly paint a picture of a Conservative Party running from accountability and transparency.

You’ll remember last week the RCMP, acting on behalf of Elections Canada, executed a search warrant on Conservative Party headquarters in Ottawa, carting out several boxes of documents. The raid was believed to be (and is) in relation to the so-called In and Out Scandal, which allegedly saw the CPC funnel national money through local riding campaigns to buy national advertising in an attempt to circumvent national spending limits, as well as increase the taxpayer refund each local campaign is entitled to. Elections Canada has denied the expenses as not being local spending and continues to investigate the scheme, the CPC is suing Elections Canada over the denied refunds (they want money from the taxpayers they’re not entitled to.)

Actually, the Conservatives don’t really contest how the scheme worked. They just don’t think it was against the law. Unfortunately for them Elections Canada, the body charged with interpreting and enforcing election law, disagrees with them. The Cons also claim all the parties do this; a claim again dismissed by Elections Canada. And, as we know, the Conservatives have had some difficulty with the nuances of election law in the past.

But back to the raids. The media successfully fought in court to have the 700-page search warrant released to the public; that will happen Monday. The Conservatives of course already had a copy of the warrant, after all, they were the ones being served and searched or, as they put it Sunday “stormed” by the RCMP. Imagine if the Liberals impugned the motives of our national police force in that way? The Conservatives would be up in arms. But I digress.

In an attempt at spin and damage control, the Conservatives decided Sunday to leak portions of the warrant to hand-picked media in top-secret briefings, in an attempt to frame the story in the most positive light possible ahead of the release of the warrant Monday. It didn’t work out too well, as the media coverage shows. Just read the headlines:

RCMP targeted alleged Tory spending scheme
Tories on defensive over Elections Canada raid
Tories violated elections law: Elections Canada
Search warrant cites 'false and misleading statements' on Conservative ads
Tories battered, evidence mounts of vote scheme
Riding deposited $40,000, money returned 5 days later

So, mission accomplished there. Actually, this thing went off the rails pretty quickly for them Sunday. Garth Turner broke news of the planned secret briefings at the Lord Elgin Hotel in Ottawa, and media members got wind of them too, leading to this exchange where CPC spokesperson Ryan Sparrow denied any briefing was happening:

When one reporter asked in an e-mail about the news conference, Mr. Sparrow replied: “No conference, not sure where you got that from.”

The reporter then flipped Mr. Sparrow back an e-mail in which he had told another reporter who was on the list that the briefing would be at “4:30 Lord Elgin, Boardroom 800. Embargo until 7:30 pm Sunday night.”

To which Mr. Sparrow replied: “I meet with journalists privately all the time.”

As a journalist myself I’ll tell you one thing, we don’t like being lied to or misled, and we tend to react strongly when we are, so it’s generally not a good idea.

But it gets better. As the rest of the media pack got word of the secret briefings, and were understandably miffed to be shut-out, they decided to stake-out the Lord Elgin. This forced the Conservatives to beat a hasty retreat to the Shearton where, as Kady blogs, the media stake-out continued.

Finally, after conducting a few briefings, the CPC decided to call the whole thing off and get out of dodge, leading to my favourite bit of this story so far:

The first briefing for select television outlets took place but, by that time, the excluded reporters found out the new location and began to stake out the hotel.

That led the Conservatives to cancel all subsequent briefings, including the one they had planned with The Globe. And Mr. Sparrow, Mr. Finley and Mr. Lepsoe fled from the Sheraton down a back set of stairs.

Other reports indicate it may have been a fire escape which, all things considered, seems rather appropriate, given that their pants may well have been on fire. The chase actually continued into the parking lot however, as shown in this exclusive video:



But while this whole thing with the media at various Ottawa hotels today does indeed come off like a Benny Hill farce, the alleged Conservative actions in this in and out scheme, as outlined in the warrants, are anything but farce:

The document alleges the Conservatives violated the Elections Act "by incurring election expenses that exceeded the election expense spending limit" by $1.1 million.
It also alleges that 67 Tory candidates "improperly" sought taxpayer-funded rebates on expenses they did not incur.

Adds the Star:

The third allegation comes under the obligation to file "true and complete reports." The allegation is that the party's official agent filed returns with Elections Canada "that it knew or ought reasonably to have known contained a materially false or misleading statement" on its expenses.

The range of penalties for exceeding the election expense limit for a party's chief agent is $1,000 fine, three months imprisonment or both. A registered party is liable to $25,000 fine.

Also of note is this from the Globe:

According to the CTV report, the affidavit handed out by the party does not reveal much more about the case than was known already. But it does confirm that the search was not related to a lawsuit launched against Elections Canada by the Conservatives after the Elections Commissioner had begun an investigation of the scheme.

Which puts to lie this early Conservative post-raid spin:

In the Commons, Harper linked the raid to the ongoing civil lawsuit launched by the Conservatives against Elections Canada's interpretation of the 2006 campaign advertising financing rules, and an alleged $1.2 million in campaign overspending.

The party insider, speaking on condition he not be identified, slammed the extraordinary raid that took place on the eve of a hearing during which Elections Canada officials were to be questioned by Conservative party lawyers…

"Is it a coincidence that they visited party headquarters today when tomorrow they fully knew that their officials were going to be examined (by Conservative party lawyers) as early as tomorrow morning? We see this as a PR stunt, a tactic of intimidation."

And it’s important to note the Conservatives only released partial information today; we’ll have to wait until Monday morning for the full warrant information to be released and to see what they didn’t want to show their hand-picked media contacts Sunday. It should make for interesting reading.

For more blogging takes on Sunday's events, see Garth Turner, Apply Liberally, Impolitical, Poggee, David Akin, Paul Wells, Adam Radwanski, Accidental Deliberations, Scott Tribe, Jason Cherniak and Saskboy.

And from Dan Cook, a little art:

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Romney a big spender

We talk a lot about money in politics, and certainly fundraising and spending was much discussed during the last Liberal leadership race. The news below however just shows again how in the U.S. they’re in a whole other ballpark. Or at least Mitt Romney is:

The former Massachusetts governor has spent $1.16 million per delegate, a rate that would cost him $1.33 billion to win the nomination.

Of course, those are American dollars…

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