Ruling in Tough Economic Times: Campaign 2008

Ruling in Tough Economic Times: Campaign 2008

On the day before Stephen HARPER called this election, one of his senior aides framed the campaign around the two questions CONSERVATIVES hoped people would have on their minds as they entered the voting booth. The first amounted to a bet that middle-class Canadians would see something of themselves in the incumbent Prime Minister, but not in LIBERAL Leader Stéphane DION: "Which leader is more like you?" is how the aide put it. And so the country was introduced to the sweater-vested Harper, and soon heard him making family-friendly niche promises like a tax break for kids' music lessons. The second question was harder-edged, and its urgency grew as the race unfolded against a backdrop of financial-market carnage: "Which leader would you rather have managing the economy in tough economic times?"

The Tories started out sure that Harper would win hands down over Dion if guiding a troubled economy emerged as the top-of-mind concern. But they got far more than they could possibly have bargained for. Their planned steady-hand-at-the-tiller message began to sound strangely passive as the market turmoil worsened. Greg Lyle, head of the polling firm Innovative Research Group and a one-time strategist for former Ontario Tory premier Mike Harris, said Harper failed to fully exploit voters' clear inclination to see him as the better economic manager. "The Conservatives look good on the economy at first glance," Lyle said. "But then you ask, 'Well, what are they doing?' And that's where they run into trouble, because their general approach is not to have the government mess around a lot. In a crisis, the public likes to see the government doing something."

So with a week left to campaign, Harper tried to add a bit of activist oomph to his stay-the-course economic theme. He announced $200 million over four years for each of two key federal sectoral subsidy funds, the Strategic Aerospace Initiative and the Automotive Innovation Fund. These fresh promises were aimed directly at Central Canada's manufacturing hubs, and particularly Ontario, which happens also to be home to the last cluster of winnable ridings offering Harper a chance to eke out a majority or, more likely, expand his minority.

Harper used a lunch speech in the heart of Toronto's anxiety-ridden financial district to urge long-term confidence in Canada's economic fundamentals. He tried to persuade a worried business crowd to take a brave look out beyond the storm clouds on the near horizon, predicting Canada "will come out of the current international downturn stronger, better, and more prosperous than ever." But he also took the odd step of reflecting, as his aides had been doing for a few days, on how he had seen economic strife coming all along. He rather awkwardly quoted himself, at length, from another speech he gave in Toronto, six months earlier, when he warned of "global financial volatility."

Boasting about a track record for issuing accurate forecasts is standard salesmanship from brokers and bank economists. But being reminded about what the Prime Minister predicted last winter might be cold comfort for Canadians watching the mutual funds in their RRSPs shrivel this fall. It's easier, though, to pick over weaknesses in Harper's message than to suggest lines that would work better. History shows that a Canadian prime minister who goes to the polls under an economic cloud faces a daunting task. Before this fall's slump, according to Statistics Canada, the country endured six recessions since 1960, the last one ending in 1991 (just before the Tories were all but wiped out in the 1993 election). In the federal election that followed each of those recessions, the party in power was either reduced from a majority to a minority, or lost power altogether.

Politics buffs with long memories might argue about how definitive economic concerns were in some of those campaigns. Still, the dismal history of governing parties that had to answer for hard times has to be worrying for Tories. Harper's approach is to downplay the extent of the crisis in Canada, beyond the undeniable drop in the value of equities. In Toronto, he made no mention of the possibility of lost jobs, seeming to suggest the damage might be contained to securities markets. He even alluded to the chance of making some shrewd stock deals. "I think there's probably some great buying opportunities emerging in the STOCK MARKETS as a consequence of all this panic," Harper told reporters. "Let's put this in perspective. It's a big drop in the stock market. It hits a lot of people. They are going to get their statement, and getting their statement is upsetting. At the same time, stock markets do go up and down, and governments can do very little about stock markets."

That sort of talk probably plays to Harper's strengths, even if it sounded more calculated than comforting. Sweater-vested or not, he was never really going to convince voters that public displays of empathy represent his authentic personality. The real Harper is more present in a refusal to be rattled. It remains to be seen how that plays, though, particularly in southern Ontario, where export-driven manufacturing is heavily exposed to any contraction of U.S. markets, and a large clump of seats remained winnable for the Tories, even as their polling numbers declined from early campaign highs. In fact, as the campaign entered its final days, both the economic news and the campaign's focus were converging on Ontario.

It wasn't expected to be that way. Earlier in the race, the road to historic Tory gains - maybe enough for a majority - seemed to run straight through francophone Quebec. After winning 10 seats in and around Quebec City in 2006, the Conservatives seemed poised to cut deeply into remaining Bloc Québécois bastions. The Laurier Institute for the Study of Public Opinion and Polling, or LISPOP, at Ontario's Wilfrid Laurier University, projects how many seats each party would win in each province based on shifting public opinion polls. Early in the campaign, LISPOP projected 22 new Quebec seats for the Tories - only nine short of the 31 they would need nationally, above the 124 MPs they returned in 2006, to secure a House majority. But by last week, dissonance between Tory talk and Québécois values, on culture cuts and stiffer penalities for teenaged criminals, had hurt Harper to the point that LISPOP was forecasting he would hold roughly the same number he won last time.

In previous eras, being held to a handful of Quebec seats would have doomed a Conservative campaign. The classic Tory majority coalitions of John DIEFENBAKER and, especially, Brian MULRONEY, combined Western dominance with Quebec breakthroughs. But times have changed. Punishing splits on the left of the political spectrum make it far harder for the Liberals - even as Dion hit his stride after an unsteady start to his campaign - to turn an uptick in the polls into a reasonable expectation of more seats. His problem is a solid NEW DEMOCRAT campaign and a small but strategically crucial slice of urban votes bleeding to the upstart GREENS, especially after an attention-grabbing performance in the English-language TV debate by Green Leader ELIZABETH MAY.

In public remarks, Conservative operatives were stressing Harper's steadfastness on the economy. In private, however, their talk tended to drift more often to those tantalizing left-of-centre vote splits. One veteran Conservative strategist said the key variable, compared to every previous campaign, is the Green vote. Based on surveys conducted the first few days of October, the firm Harris/Decima had the Greens holding at 13 per cent support nationally, a notch higher at 15 per cent in Ontario, fully triple the party's vote total on election day in 2006. Like NDP support, the Green vote bites largely into potential Liberal support. As a result, even if Harper fails to better his 2006 popular vote of 36 per cent, or falls below, he could win considerably more seats. Early this week, LISPOP said publicly available polls had the Tories adding 15 seats in Ontario, even as the party's support drifted down. Some Conservatives said close three-way, or even four-way races, in and around Vancouver might deliver Harper a few more hard-fought seats.

The key battleground is Ontario, the big question is how to react to economic upheaval, and the main strategic variable is a new sort of vote splitting on the left. If there's a strong possibility that a familiar result will be cooked up on Oct. 14 - another Tory minority - it won't be for lack of some new and interesting ingredients being thrown into the mix.

Maclean's October 20, 2008