By naming economist Kevin Lynch as his new clerk of the Privy Council—the nation’s top public servant—Stephen Harper may get more than he bargained for. Paul Martin certainly did. As Martin’s deputy minister of finance from 2000 to 2004, the hard-headed Cape Bretoner proved just as likely to steer a politician as to carry out his orders.
Anyone who got his professional start, as Lynch did in the 1970s, managing the country’s enormous debt at the Bank of Canada, could be forgiven for developing a taste for fiscal restraint. But Lynch was a champion of more than balanced budgets. While serving as deputy minister of industry from 1995 to 2000, statistics crossing his desk showed Canada falling behind the United States in living standards because businesses were less efficient. This “productivity gap” was an egghead argument and a hugely unappealing political message. The government didn’t want to admit problems or promote solutions that sounded like an agenda for making people work harder. But Lynch pushed, personally lobbying Jean Chrétien’s PMO, and flashing PowerPoint slides showing how
Canadians were poorer than Americans, right down to the cars they drove (Honda Civic vs. Toyota Carnry). As the productivity issue morphed into the “innovation agenda,” Lynch championed increased research spending, Internet access for schools, and the Canadian Research Chairs program, aimed at stemming the “brain drain.”
Lynch took the arguments and legendary work habits with him to Martin’s Finance Department. “He was instrumental in convincing the government to lower the corporate tax rate and reduce the capital tax,” recalls Don Drummond, a former associate deputy minister. Though he spent late nights working closely with Martin, Lynch avoided partisan labels. “I worked within 10 feet of him for 12 years and I wouldn’t have a clue if he was Liberal or Conservative,” says Drummond. Lynch is above all an ideas man, who speaks with a graduate student’s enthusiasm on such matters as, say, the links between the American current account deficit and the lack of public pensions in China.
When Martin became prime minister, many expected Lynch to become his clerk. When he didn’t, he headed to Washington as a director of the International Monetary Fund.
At the Privy Council Office, he will have his work cut out for him. The PCO must school new cabinet ministers who have never been in a governing party, let alone ministers of the Crown. He’ll have to figure out how to achieve the mammoth cost savings implicit in Harper’s platform, and address the vexing issue of fiscal federalism. He will replace another prodigious intellect—outgoing clerk Alex Himelfarb, whose passion was social policy. Lynch’s is likely to be the economic infrastructure that underpins it. “He is focused and determined and the sort of guy who is going to have his hands on the file,” says former minister of state for finance Maurizio Bevilacqua. “Don’t be too surprised to find him in his office on Sundays. I’ve found him there many times.” BY LUIZA CH. SAVAGE
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