Canada

The gentler touch

ROBERT SHEPPARD May 18 1998
Canada

The gentler touch

ROBERT SHEPPARD May 18 1998

The gentler touch

Canada

ROBERT SHEPPARD

After three years of damn-the-torpedoes Mike Harris government, Ontarians are being treated to a wave of niceness that they have not seen in quite some time. Canada geese are once again flying in the premier’s promotional videos; public money is being lavished on all sorts of projects—including $1.2 billion to refurbish many of the same hospital beds and long-term care centres that the Ontario government spent much of the past two years closing. Even the elegant Hilary Weston, delivering the recent speech from the throne, foreswore the leatherpadded lieutenant-governor's chair to stand at a modest lectern and intone: “Your government will move forward with care.”

Are Ontarians warming to this midterm make-over, so different from the brash, arms-folded demeanor that has confronted teachers, hospital workers, civil servants, organized labor and any number of municipal champions or civic-minded critics? Too early to tell, the pollsters say, although a couple have at least discovered a “softening” in the antipathy towards the Harris government in recent weeks. That may be attributable largely to the booming provincial economy,

they are quick to note. The bigger question: can the country survive a kinder, gentler Mike Harris?

Already, the new, more compassionate Harris—the “counterintuitive” Harris, in the buzzword making the rounds at Queen’s Park—has thrown a wrench into the comfortable world of interprovincial diplomacy. Last week, he spun on a dime and offered to pay an additional $200 million in compensation for all Ontario victims of hepatitis C poisoning (a federal-provincial deal, announced last month, offered $1.1 billion only to those who had contracted the disease through tainted blood between 1986 and 1990).

That put the tight-fisted feds—and almost all his fellow premiers—on the spot. One by one, the provinces had said that greater compensation was a fine thing—but only so long as Ottawa picked up the tab. “It’s a question of means,” Quebec’s Lucien Bouchard told his legislature on May 5. “Quebec has gone to the extreme limits of what it can do and I believe that most provinces are in the same situation.” On May 6, two days after Harris’s announcement, he changed his mind and offered $75 million in extra compensation to those infected by tainted blood before 1986, the year in which a screening test was first available.

Can Mike Harris's new charm offensive restore the fortunes of Ontario Conservatives?

But it is not only the prospect of a suddenly more generous Ontario tweaking Prime Minister Jean Chrétien and squirting additional money at federal-provincial projects that has other provincial premiers worried. Last week, the Harris government completed the third of three personal income tax cuts it promised in its so-called Common Sense Revolution three years ago—and threw in a few other tax cuts to boot. As of July 1, the personal income tax rate in Ontario will be the lowest in the country, and 30 per cent less than it was in 1995—a reduction that has contributed at least in part to greater consumer spending and phenomenal job growth in the province over the past year while substantially increasing tax revenues to the treasury.

Ontario’s tax cuts, though, have forced other governments, not always as fiscally well-equipped, to follow suit. And the cuts have wreaked havoc on the country’s system of equalization. The formula is derived in large measure

from an averaging of provincial tax rates. And as Thomas Courchene, the Queen’s University political economist whose writings are bedside reading for the Ontario premier, explains: “Ontario has such weight when it comes to cal-

What is behind Harris’s new charm offensive? For a government that has taken a host of difficult decisions and stared down its opponents with all the charm of a traffic cop, this is merely “the

next logical step,” says Paul Rhodes, a former communications adviser to the premier and now a private consultant. “We like the home renovation analogy. We’ve ripped out the insides, put in the new wiring and plumbing. Now we’re in a position to move in and make Ontario

a more comfortable place to live.” Others are somewhat less charitable, noting that the Tories are languishing behind the opposition Liberals in the polls. Most political observers, and, privately, even some government insiders, say Harris was badly stung by his handling of compensation for the three surviving Dionne quintuplets two months ago, and later by his rationale for removing the $37-a-month nutritional allowance for pregnant women on welfare—to “make sure that those dollars don’t go to beer.” Both cases reinforced the image of a boorish, uncaring leader concerned only about the bottom line.

Regarding the Dionnes, the Harris government first refused to consider compensating the elderly sisters for a provincial trust fund that somehow ended up with substantially less money than expected in it. Then, the government offered to jam $6,000 a month into their bank accounts, whether the Dionnes accepted it or not. It was only after a few days of being portrayed as a heartless accountant that Harris saw the error of his ways, blamed government lawyers for offering too legalistic advice, and flew to Montreal, where the sisters now live, with a coffee cake and a cheque for $4 million.

A similar pattern seems to be playing out with the hepatitis C victims. Soon after Ottawa and the provinces agreed to a limited compensation offer on March 27, Quebec started the call for greater compensation—as long as only Ottawa paid. Ontario Health Minister Elizabeth Witmer made the same demand on April 29. Two days later, on Friday, May 1, Harris and Chrétien butted heads at a car plant opening in Brampton, Ont. On the following Monday,

the premier made his surprise offer of provincial compensation.

The Chrétien factor in all this should not be discounted, says veteran Queen’s Park lobbyist Graham Murray. In February, when Hands and his finance minister, Ernie Eves, criticized the federal budget for its “betrayal” of Ontario, Chrétien swatted them down by saying Harris had tax cuts for the rich but nothing for Ontario’s cashstrapped hospitals. “Politically, that was game, set and match for Chrétien, and for Harris, that just stuck in his ear,” says Murray. “So when Chrétien used the same line at Brampton over the hepatitis C controversy, Harris was just furious. You could see it in his eyes. He was just looking for the chance to throw some personal punches at the federal government.”

Murray sees some redeeming political value in these manoeuvrings: for the first time in a very long while a provincial government is trying to use its spending power to get the feds to move on a national program. And Ontario’s fiscal situation certainly seems healthy enough. The provincial budget was one of those miracu-

_ lous documents that cut taxes, reduced

the projected deficit to $4.2 billion from $5.2 billion and scattered money on a variety of popular causes—including day care, children’s aid services, hospital emergency wards and university research.

The only blot: the provincial debt continues to rise. By the time the Tories plan to balance the budget in the spring of 2000, Ontario’s debt could be $116.5 billion, according to the government’s projections—$27.9 billion of that coming on the Tory watch. “My personal fear,” says economist Courchene, ”is that a downturn won’t let them complete the task of eliminating the deficit.” But according to Eves, a more cautious approach “allows the people of Ontario to share in some of the benefits of the Ontario economy. I am not interested

simply in getting to the bottom line as quickly as possible.”

Easing up on the throttle lends this exercise the cocky thud of an election budget. But the Tories are not gearing up for one anytime soon. They have been trailing the Liberals in the polls for over two years now, with their support ranging from 33 to 38 per cent. That is much better than the 20-something level of support, as Harris told his caucus privately over a year ago, that the Tories might have to endure to push through the government’s tough reforms. But a closer look at the numbers shows a bigger obstacle. “Seven of 10 Ontarians don’t think the government is listening or consulting enough,” notes Jane Armstrong, senior vice-president at Environics Research Group. “They have been saying the pace of change has been too fast. And the majority has been saying the government has the wrong balance between reducing the deficit, cutting taxes and maintaining services. They want services maintained.”

The Conservatives’ new message is that they have listened—or, at least, are listening now. The closest the government came to an actual apology was in last month’s throne speech, when it said that the magnitude of change it felt Ontario required “may at times have overshadowed the role and the importance of public input and participation.” But do not ask the Harris Tories to change their tax-cutting stripes. With an eye perhaps to next year’s budget—the real election budget—Finance Minister Eves said he hoped “eventually” to have the opportunity to reduce Ontario’s provincial sales tax. Then he winked. □