Fleeing from their revolution

B.C., Alberta and Ontario's self-preservation overtakes common sense cuts

Calgary Herald — March 29, 2002
by Don Martin

They sat on the outdoor patio of a St. John's blues bar called Fat Cat's on a warm Newfoundland night in August, 1995, toasting their first premiers' conference together as fearless Tory twins writing the gospel of a fiscal revolution.

Alberta's Ralph Klein was halfway through his first term, riding a 20% spending cut roughshod toward the $2.5-billion deficit he had resolved to eliminate.

Ontario's Mike Harris was making his debut on the national stage, ready to impose his tax-slashing Common Sense Revolution on a socialist-weary province where protest was already flaring in anticipation of the carnage to come.

I was sitting between the two premiers, chatting with Colleen Klein and trying not to be noticed by the Harris contingent, lest they be spooked by a Calgary journalist monitoring their conversation.

The two premiers shot the breeze for half an hour before Harris finally grinned at me and reached out a handshake. "Call me Mike," he said, "so what do you do?" "Media," I reluctantly confessed, figuring the ruse was up. Harris didn't miss a beat. "Just be thankful you don't have those bastards at The Toronto Star to deal with."

Klein smirked at Harris' mistaken impression that I was an Alberta media flack, but said nothing and went back to talk about fishing and political strategy with his new understudy.

Behind the scenes, Klein aide Rod Love was huddled with Harris advisers, regaling them with the war stories of how Alberta had cut deep, cut fast and cut everywhere at once, leaving the Opposition swamped, the special interests divided, the media disoriented -- and the public generally impressed.

It was thus that an Alberta-Ontario axis was born, a shared drive to deliver a bloody provincial reinvention using a retreat to core program funding, stimulative tax reductions, rampant privatization and tough-love welfare reform to beat their self-imposed deadline for outlawing the deficit.

Seven years later, Klein's farewell video to the retiring Harris ended with a photo of their 1996 conference in Jasper where all the premiers who had retired were digitally deleted. The two Tory renegades were the only ones left standing in the mountain scenery.

Now Harris is gone, ruefully wishing he'd followed the faster, deeper, wider pattern of change advocated by Alberta, before it too lost its nerve. If he had any regrets about slashing social spending on the poor to finance a hefty tax cut for the well off, he didn't show it.

"I wish we had cut taxes faster. I wish we had balanced the budget sooner. I wish we had increased education standards higher, changed labour law more rapidly, lowered workers' compensation premiums even more dramatically while improving workplace safety standards," Harris mused.

That window of opportunity has been nailed shut now that he's been replaced by Ernie Eves, a slicked-back presidential-style of premier racing to find the road's centre line before an election call expected next year.

The former finance minister who reluctantly swung the axe in Ontario makes no pretense of threatening the status quo except to soften its blunt edges with more money. He is the Harris counter-revolutionary, whose opening pledge of a kinder, gentler working relationship with the feds was hardly the sign of an envelope being pushed.

But for a true-blue picture of a Conservative revolution on the run, look to Alberta.

The Klein government's early approach had better optics than the Ontario strategy. It reduced spending first and held off tax cuts until a balanced budget gave it the capacity to help low income earners.

But now Alberta's floundering madly in all directions, showing the fiscal spine of a jellyfish in a frothing jacuzzi. It spent hugely in the election year, a $2.5-billion bloating of the bottom line in 2001 plus almost $4-billion worth of government rebates to offset soaring energy prices and to serve as damage control for a botched power deregulation scheme. Even Klein's fans at the C.D. Howe Institute found that one hard to swallow, tsk tsking his government's deregulation effort for "giving the province the dubious distinction of jumping from one of the lowest to the highest electricity rates in the country."

This year, Klein cranked down spending, pleading the negative revenue impact of lower energy prices. But even that resolve was short-lived. After the government's reneging on a commitment to give municipalities the five-cents-per-litre fuel tax for transportation projects in last week's budget unleashed a cranky hullabaloo from every city hall, Klein abruptly found enough money to reverse the cut this week.

Even Klein's most dedicated diehards are looking askance as the poll-dropping government flips and flops, dragging down fiscal policy to its lowest common budgetary denominator -- a tax hike on booze and butts. Meanwhile, the much-ballyhooed Alberta health-care reforms are languishing in a handful of committees for further study, with the notable exception of a hefty boost in health insurance premiums.

"Look, I'm a realist and I face reality," Klein told me in a recent interview. "If we have a huge surplus and are able to do one-time spending and address some problems that need to be addressed, then we do it. If there's a serious decline in revenues and we don't have the money to do the kind of things people expect, then we bite the bullet and say no."

Common sense? Perhaps, in a flaccid fiscal sense. Revolutionary? Not a bit. So if there is a revolution still sputtering in Canadian provinces, where is it? Well, look to British Columbia, where a fresh Liberal government has a mandate for change that's beyond dispute -- a 75-seat edge over its two-seat Opposition.

That Gordon Campbell's troops have the motivation is equally clear: a $4.4-billion deficit that must be slashed to zero in three years, a have-not provincial economy on the softwood lumber skids and a debt-to-GDP ratio that will slide below Manitoba later this month.

While it gets full marks for trying to shake New Democrat thinking out of the B.C. bureaucracy, so far it's mostly words, not deeds. Campbell's first budget raised the sales tax and posted an even larger-than-anticipated deficit.

His contribution to out-of-box thinking was to open cabinet meetings to the public, turning difficult decision-making into television theatre, no doubt scripted well in advance.

For the most part, the B.C. Liberals are following the Conservative script to slash the government workforce and cut extraneous programs to preserve health and education spending. But on the big stuff, like privatizing auto insurance and B.C. Hydro or trying to pick the federal handcuffs on health care, it's a revolution on the run.

"We will do lots of things people will characterize as like-Klein or like-Harris, but it's not driven by any ideological fervor to reinvent government. It's driven because we've a $4.4-billion deficit, we've got a moribund economy and we're screwed," confided a friend of mine, who works high in Campbell government circles.

So at the end of the bloodletting, what's changed? Not much.

Ralph Klein's revolution has merely gone full circle, argues his old nemesis, former Liberal leader Nancy MacBeth. "He's had three back-to-back budgets that grew by close to 40% and now we're short of money," she shrugged in an interview. "The problem is that he can't blame the last ten years on (former premier) Don Getty. He's got his own record to deal with."

In Ontario today, you'd still wait hours to register your car or renew your driver's licence through government-run centres. And that wait could now stretch into weeks with the public service union on strike.

The closing of hospitals and nasty showdowns with teachers have merely left school and hospital boards anxiously waiting for an Uncle Ernie Eves bailout to eliminate their deficits.

As the last premier revolutionary, Gordon Campbell is making the same noise as an early Klein or Harris, but there's every reason to believe he too will capitulate to pre-revolutionary behavior once the financial crisis has passed.

It may well be that voters want a return to the old ways of government once the books are balanced.

But when the impetus for structural change surrenders to political expediency, Fat Cat's is no longer just a blues bar in Newfoundland. It becomes a government's lifestyle of choice.

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