US embassy cable - 05OTTAWA1681

C O N F I D E N T I A L SECTION 01 OF 03 OTTAWA 001681 
 
SIPDIS 
 
E.O. 12958: DECL: 06/05/2016 
TAGS: PGOV, CA, PREL, Liberal Party, Conservative Party 
SUBJECT: LIBERALS AND CONSERVATIVES REGROUP, WAIT FOR THE 
NEXT ROUND 
 
Classified By: POLMINCOUNS Brian Flora, reasons 1.4 (b) (d) 
 
1. (C) Summary: It appears that the most likely scenario now 
is an early spring election following the end of year release 
of the Gomery report.  Both sides have settled in for what 
amounts to a 10-month campaign, with the Liberals appearing 
much better organized and focused.  The Conservatives 
continue to struggle to develop a theme that will resonate 
nationwide, and are hampered by the limitations of their 
leader.  End Summary 
 
So Un-Canadian 
-------------- 
 
2. (C) According to David Zussman, CEO of EKOS Research 
Associates, the past few months have been very un-Canadian. 
Canadians, Zussman said, like stability and are accustomed to 
predictability in their political life, and hardly know what 
to make of the chaos that has engulfed the political process. 
 From the circus-like atmosphere in Question Period to the 
razor's edge survival of the government, this sort of thing 
just doesn't happen here.  The desire for predictability, 
Zussman told us, could be what has held Canadians back from 
the brink on several occasions, and is what makes it possible 
to reconcile the seeming contradiction several weeks ago of 
plummeting numbers for the Liberals but no desire to go to 
the polls.  There has been an air of relief on all sides 
since the failed attempt two weeks ago to bring the 
government down, and the Government and Opposition have gone 
back to work to bring the current session of Parliament to a 
modestly successful conclusion, while shaping the environment 
for the electoral battle to come. 
 
Winter or Spring Elections 
-------------------------- 
 
3. (C) According to Political Analyst Bruce Campbell, the 
question since PM Martin committed to calling an election 30 
days after Justice Gomery issued his report, is not if but 
when the election will be held.  He believes the report will 
be issued at the end of the year which would put the election 
in late February or early March.  But Liberal MP Derek Lee 
from Toronto told us that an election in the dead of winter 
is a non-starter in Canada -- "people can literally die 
during a winter election," he said.  He foresees a scenario 
in which the government and opposition agree to interpret the 
PM's promise liberally, and allow for the election to occur 
fully into the spring.  Liberal MP Francoise Boivin of Quebec 
also believes something will happen to allow for a later 
election -- the release of the report could be stretched out 
a few more weeks for example. 
 
4. (C) But in talking to Conservative Deputy House Leader 
Jason Kenney, it is quite clear that the Conservatives want 
an election just as soon as they can bring it on.  Kenney 
scoffed at the idea of pushing an election into the spring 
just for the weather, and indicated that if the Conservatives 
had the chance they would not hold back from bringing the 
government down this month (although he appeared resigned to 
the fact that they would not have that opportunity).  Kenney 
expressed intense frustration that the Liberals were able to 
stave off an election last month but said the Conservatives 
have not backed down.  Commentator John Ivison said many 
conservatives believe that "volatile public opinion polls 
have underestimated Conservative support.  They cite the 
Labrador byelection where their share of the vote doubled in 
a riding that has never been kind to the Tories."  The 
Conservatives remain locked and loaded. 
 
5. (C) Derek Lee said the Liberals are not taking anything 
for granted, and have thought through the possible scenarios 
for a no-confidence vote this month.  One is an ambush, in 
which the Conservatives and Bloc gang up on the government on 
a day when it isn't expecting it and push through a 
no-confidence motion when there are Liberal absences.  A 
second is if the NDP part of the budget gets stalled and the 
NDP decides the government is not pushing hard enough for the 
budget and withdraws its support.  And a third is if the NDP 
feels it is getting too close to the Liberals and is losing 
support in the process, in which case it might decide it 
needs to withdraw its support to survive.  Lee doesn't think 
these scenarios are likely, the Liberals are on full alert 
for the ambush scenario and are fully cognizant of the need 
to maintain NDP support. 
 
What Is Ahead? 
-------------- 
 
6. (C) So assuming we are headed for a spring election, how 
is it shaping up?  Zussman says that the backdrop for the 
election generally favors the Liberals.  The economy is doing 
well and the Parliament will be able to sufficient 
legislation so that the last term will not be a complete 
wash.  Money and programs are flowing, and relations with the 
U.S. and the world are "good enough."  Gomery is grinding on 
but there don't appear to be any more bombshells, and the 
scandal appears to have its limits.  There is growing fatigue 
with sponsorship outside of Quebec. 
 
Liberal Strategy 
---------------- 
 
7. (C) Against this backdrop the Liberal strategy for the 
election is fourfold.  First, shore up NDP support by pushing 
through the budget accord and trying to hold out something 
else for the future.  This is tricky, as Jack Layton said 
very clearly up front that the NDP was supporting a budget, 
not a government.  The NDP MP from Winnipeg was even more 
cutthroat recently, saying "Our compact with the Liberals is 
very specific and finite -- until the budget gets Royal 
Assent. After that, I for one welcome the opportunity to vote 
these guys out of office and I think the chance will come 
sooner rather than later."  The NDP must maintain a 
distinguishing distance between it and the Liberals, or it 
will be swallowed as it was after the 1988 election in 
Ontario, when it signed an accord with the Liberals, only to 
see the Grits win by running on the record that their accord 
facilitated. 
 
8. (C) Second, the Liberals need to continue to work the 
provinces, especially Ontario, with new programs and 
promises.  We can expect more equalization talks with Premier 
McGuinty and more programs for communities and 
infrastructure.  Third, they must highlight the 
Conservatives' "hidden social agenda" and add to it the 
specter of strengthened separatism because of the 
Conservative-Bloc alliance.  And fourth, they need to take 
some of the blame for Gomery, while showing that they remain 
best positioned to clean the mess up.  Boivin and Lee both 
say that there is no doubt sponsorship will hurt the 
Liberals, but neither saw it as crippling.  Boivin said she 
won her riding in Hull, Quebec, by a very narrow margin and 
knows that there is rapt attention being paid to the Gomery 
inquiry in Quebec which will hurt her.  But she also believes 
that there is limited support for separatism, and when voters 
make their decision they will not just be voting against 
corruption, but for something, and when they look honestly 
at what the parties have achieved, the Liberals may just look 
good enough. 
 
Conservatives Seek a Theme 
-------------------------- 
 
9. (C) The Conservatives to date have been sticking to the 
corruption theme, evidenced by their intense focus this past 
week on the Grewal affair in Question Period.  There is no 
doubt that this theme has some resonance with the Canadian 
electorate and that the sponsorship scandal has damaged the 
Liberal Party brand.  The question is whether the damage 
transfers into support for the Conservatives, and whether it 
will last until the voters finally go to the polls.  Jason 
Kenney believes the corruption issue will remain central to 
the Conservative platform, but also thinks the party needs to 
develop a positive theme that will attract voters.  He is 
uncertain what that issue, or basket of issues will be.  He 
mentioned 'choice in child care' as one thing that the party 
will promote (indeed it has been doing so in Question 
Period).  He also said the positive side of corruption -- 
good governance and strong oversight -- will be highlighted. 
He believes health care would definitely not be a 
Conservative issue, because the party position is so tainted 
that it invariably would be painted into a "two-tier" corner. 
 And while he mentioned economic and fiscal responsibility, 
he was not sure how that particular issue could be developed, 
since they would be running against the architect of Canada's 
budget turnaround. 
 
Harper a Growing Liability 
-------------------------- 
 
10. (C) In short, the Conservatives have not yet found their 
footing.  This is made worse by the problem of leadership. 
The Conservatives are having a very difficult time shaking 
the negative image that many Canadians, especially in Ontario 
and Quebec, have of Stephen Harper, who Campbell believes 
"engendered a fear factor in the 2004 election which the 
Liberals were able to effectively exploit through negative 
advertising in the closing days of the campaign."  Campbell 
believes frankly that as long as Harper is at the helm, the 
Conservatives can't win.  There are now open calls for his 
resignation, with one prominent commentator saying that it is 
time for Harper to recognize that he has taken the party as 
far he can and pass off to someone else.  Lee says that some 
of his conservative colleagues have also expressed 
frustration with Harper's continued leadership.  But no one 
we have queried sees any likelihood of Harper stepping down; 
most believe the party must go through the next election 
before  it will have the opportunity to pick a new leader. 
 
11. (C) To his credit, Harper faces the difficult task of 
being socially and fiscally conservative enough to keep the 
party's western roots happy, while appearing moderate enough 
to appeal to urban Ontario and Quebec.  The Stronach 
defection brought this inherent Conservative schizophrenia 
out in the open.  While there were apparently personal 
conflicts that played out and Harper clearly made some 
mistakes, it was clear at the Conservative Convention that 
Stronach was not comfortable in the party to begin with.  Lee 
believes it nonetheless sent a chilling message to women who 
might have voted Conservative, to see a progressive, moderate 
woman leave the party because she couldn't find a place 
there.  The crossing no doubt will hurt the Conservatives, 
although the damage was mitigated somewhat by the flighty way 
Stronach made her move. 
 
The Kinder, Gentler Bloc 
------------------------ 
 
12. (C) The Bloc Quebecois meanwhile is just biding its time. 
 Gilles Duceppe continues to get out as much as possible to 
soften the image of the Bloc from wild-eyed separatists to 
the friendly Quebecers next door.  But he makes no pretense 
to any other platform than the full separation of Quebec from 
Canada.  He will continue to ride the discontent over Gomery 
and milk the scandal for whatever it is worth. 
 
13. (C) Comment: The Liberals appear to have come out of the 
recent scrum on top, or at least holding their own.  They are 
banking on a kind of scandal fatigue setting in, which indeed 
appears to be happening.  Meanwhile they will continue to 
deliver on the kinds of things that are genuinely popular 
with the electorate.  But assuming nothing unexpected 
happens, there are still ten months before the election, a 
very long time in the current climate. 
 
Visit Canada's Classified Web Site at 
http://www.state.sgov.gov/p/wha/ottawa 
 
GALLAGHER