Canadian Election Update - Heating Up

Focus on Canada for a few minutes.  Remember....our largest trading partner....the ones with a bunch of oil and gas...the ones who buy a lot of stuff from us as well?  Yeah, those guys.

Here's the latest news on their Federal election (one aspect of which is fantastic....it's over in weeks!).

Chris Wattie/Reuters

Conservative leader and Prime Minister Stephen Harper gestures while delivering a speech during a campaign rally in Habour Grace, Newfoundland on Saturday.

Week two of the federal election campaign began Sunday with Liberal Leader Stephane Dion attempting to close a widening gap with the Conservatives by trying to capitalize on Newfoundland Premier Danny Williams' animosity toward Stephen Harper.

Mr. Dion was to fly to St. John's, N.L. Sunday where he planned to campaign Monday following Williams' stinging rebuke of the ruling Tory party.

"A majority government for Stephen Harper would be one of the most negative political events in Canadian history," the outspoken Newfoundland premier opined last week.

Mr. Dion needs to build momentum after a week of polls showed Mr. Harper and the Conservatives pushing ever closer to a coveted majority. While some polls offered a more optimistic view of Conservative fortunes, they generally showed Harper jumping out to an early lead in the opening days of the five-week contest, showing modest gains compared with the virtual horse race depicted by pollsters when Parliament was dissolved.

The Conservative gains came despite some significant missteps by their war-room that forced Mr. Harper to apologize for an Internet ad that showed a pigeon defecating on Mr. Dion, and he also suspended a top staffer for suggesting a man whose son was killed fighting with the Canadian Forces in Afghanistan was actually a partisan Liberal.  

Apparently, a major issue in the campaign is having the country be exactly in the middle of the political spectrum.....like Goldilocks, not too hot, not too cold.....just right.

 "I think the Canadian public has become more conservative," Harper said in New Brunswick as the first week drew to a close. "At the same time, I don't want to say the Canadian public is overwhelmingly conservative, or that it is necessarily as conservative as everybody in our party, and that means that our party has to make sure that it continues to govern in the interests of the broad majority of the population."

 MORE....of the same.


And here's some additional insight from the Wall Street Journal:

One candidate believes in low taxes, gun rights and a strong national defense. The other has a dog named Kyoto and promises to levy a new carbon tax on industry. Any guess who is favored to win the Canadian federal election set for October 14?

The answer is Prime Minister Stephen Harper of the Conservative Party, who was elected in January 2006 on a platform to strengthen the military and cut taxes. He has done both. And though he once pledged not to call an early election, he did so on Sunday, explaining that the current parliament has become so "dysfunctional" he can't govern without a new one.

Mr. Harper's main opponent is the Liberal Party's Stéphane Dion, a former environment minister who chaired the U.N. climate change summit in Montreal in 2005. The Conservative minority government would have to add 28 seats to its present 127 to seize a majority, and Mr. Harper is on record saying he doesn't expect that. But he clearly believes that, despite a slowing economy and the loss of the 97th Canadian soldier in Afghanistan last Sunday, he can beat Mr. Dion. The reasons are instructive.

Mr. Harper has restored the country's international prestige by demonstrating political courage on Afghanistan. The Liberals had sent Canadian troops there in 2001 but began agitating for withdrawal when things got difficult. Mr. Harper has refused to cut and run, and he has chastised those NATO partners in Europe who have shrunk from the fight. He has also boosted defense spending so Canadian troops are properly armed.

By contrast, Mr. Dion had sought to withdraw Canada's Afghan contingent "with honor" before 2009. His effort failed, even within his own party, and earlier this year Mr. Harper won an agreement with the Liberals to stick it out in Afghanistan until 2011.

Like Americans, Canadians are also worried about the economy and aren't eager for a tax increase. Mr. Harper has cut the corporate tax rate to 19.5% and has a plan to reduce it to 15% by 2012. (The U.S. rate is still 35%.) He has also reduced the national sales tax by one percentage point to 5%. That boost to consumer purchasing power may have helped Canada avoid recession in the first half of this year. GDP shrank in the first quarter by 0.8%, grew a meager 0.3% in the second and may not do better than 1.1% for the year, according to Finance Minister Jim Flaherty. Mr. Harper argues that now is not the time to raise taxes.

Mr. Dion has a different view, proposing what he calls "the Green Shift." It would impose C$15.4 billion (US$14.4 billion) of new taxes on Canadian industry for their carbon emissions while cutting income taxes. Mr. Harper calls Mr. Dion's plan "the Green Shaft" and likens it to Pierre Trudeau's 1980 "national energy policy" which, the Prime Minister said last week, "was designed to screw the West and really damage the energy sector." Though he added that there is a difference: "This will actually screw everybody across the country." The fellow can be blunt.

The larger question is what Mr. Harper would do with a real majority. In 2005 his Liberal opponents portrayed him as a far-right extremist. Yet like his countrymen, he has shown little appetite for extreme positions, and if anything he has proven to be a steady leader who until recently has worked effectively across party lines. Even the separatist movement in Quebec seems to have lost its mojo during his tenure. That may be why Canadians are likely to ask him to stay on.  MORE....