BUSINESS WATCH

Slamming the doors on John Turner

Peter C. Newman December 5 1988
BUSINESS WATCH

Slamming the doors on John Turner

Peter C. Newman December 5 1988

Slamming the doors on John Turner

BUSINESS WATCH

PETER C. NEWMAN

All the speculation about John Turner’s political future may be irrelevant. That is because in the hiring climate he created for himself during the election campaign—when it was sometimes hard to tell whether he was fighting the Conservatives or the business community—being leader of the opposition may be the only job he can get.

Turner was the Bay Street power broker touted through the Trudeau eternity as the Canadian business establishment’s official choice for prime minister: the one candidate who would exercise the same sense of fiscal and political responsibility he had preached as a senior director of Canadian corporations with assets of $25 billion. (He also served as Canadian head of Bechtel Group Inc., the San Francisco-based engineering and construction firm that ranks among the most interventionist of American multinationals.)

Because they feel that they have been betrayed by one of their own, the paladins of big business have now slammed their doors in Turner’s face—even before he has come jobhunting. “No one anticipated that Turner would turn into such a mad dog,” said Jack Fraser, head of Federal Industries Ltd. in Winnipeg, echoing the feelings of his peers during the campaign. “It’s one thing to want to be elected,” Fraser added, “but to screw your country in order to win, that’s just disgusting.” As usual, it was Conrad Black who had the last word: “Not since Maurice Duplessis embarrassed the Liberals and amused himself by accusing his opponents of importing ‘Communist eggs’ from Poland has a leader of a major Canadian party inflicted upon his electorate such an avalanche of sulphurous falsehoods and banalities.”

The low point of Turner’s antibusiness crusade was his refusal to disown the comparison drawn by his chief strategist, Michael Kirby, who had compared big business to the Ku Klux Klan. “Do the Liberals really believe evoking an image of businessmen as hooded, torch-

‘No one anticipated that Turner would turn into such a mad dog.

To screw your country in order to win, that’s just disgusting’

bearing racists gives credibility to their attack on the free trade agreement?” thundered The Financial Post.

Certainly, the Liberal leader left little doubt about where he stood. He attacked businessmen at every campaign stop, painting them as profit-hungry vultures trying to “buy this election on the backs of the workers.” His party’s run-up ad to voting day urged Canadians to “Vote ‘no’ to big business.”

Business responded with a barrage of profree-trade advertising, with as much as $4 million spent on publishing numbingly boring four-page inserts in Canadian newspapers and magazines. It was the first time in generations that the Canadian business community had involved itself on one side of a federal election. The fact that its arguments carried the day has prompted free trade supporters to believe that it will control the Mulroney government’s political agenda, including the kind of massive deficit reductions it advocates.

In that context, it was significant that the newly re-elected Prime Minister used his first news conference to declare that he owed the business community nothing. “I have no debt towards someone in favor of the deal more than I have a debt to those opposed,” he said.

“Everyone had the right to speak out.” Still, having won on free trade, the business community will now press the government on significant deficit reductions in the 1989 spring budget. Given the choice of higher taxes or reducing expenditures, it has naturally opted for less federal spending, particularly on universal social payments.

But if Mulroney learned one lesson in his first term, it was that nearly all Canadians consider such programs inviolate. If the new federal sales tax is as revenue-neutral as Michael Wilson claimed it was during the election, Ottawa will not be able to reduce spending much—especially when the economy goes through its expected slowdown and revenues begin to decline. That means the Tories face a serious dilemma.

With the national debt due to hit at least $300 billion by the end of the year, Mulroney may have to depend on the private sector for job creation and some of the compensatory schemes required to heal the worst economic effects of free trade. The report of the Advisory Council on Adjustment, a federal inquiry into which industries will be hurt, and by how much, headed by Jean de Grandpré, chairman of Bell Canada Enterprises Ltd., will become a key document in that debate.

Mulroney says that he has served the business community well enough in his first term and, through his free trade initiative, that he can afford to ignore its advice and lobbying for a while. His biggest concessions, of course, were dismantling the National Energy Program and declawing the Foreign Investment Review Agency; now, there are few regulatory restraints remaining to prohibit Canada’s business community from proving, once and for all, that it knows how to survive and prosper in the international marketplace.

At the same time, the Liberals cannot continue to reject the business community as a legitimate part of Canadian society. Reconciliation with John Turner will be difficult. The only business types elected were Montreal’s Paul Martin Jr., Toronto’s Roy MacLaren and Jim Peterson and Fredericton’s Bud Bird. A few well-placed senators, including Vancouver’s Jack Austin, Toronto’s Ian Sinclair and Montreal’s Leo Kolber, will also be helpful. A few business community leaders, mainly Paul Desmarais, Conrad Black and the Investment Dealers Association of Canada’s Andrew Kniewasser, who have a foot in both political camps, may be useful go-betweens. “Nobody tears up treaties,” says Sinclair, “and businessmen will have to recognize that politicians get carried away in a fight. There has to be an accommodation with the Liberals, because you can’t sustain a situation where the working people think they can only be heard through the NDP and businessmen only through the Tories. That can’t and won’t remain true—don’t forget it took a long time for Pierre Trudeau to listen to any businessmen in this country, but eventually he did and was not unimpressed.”

There is little question that such a healing process will eventually take place. But there are only two chances that John Turner will be part of it: slim and nonexistent.