Thursday, August 28, 2008

Bankrupting the bankrupt Liberals

This is an interesting and well written article by a well known Conservative strategist. Flanagan makes some excellent points. Note that Flanagan assumes that lack of funds will be a millstone around the Liberals' neck. Other things being equal this is probably true but there are times when voters become so disgusted with a ruling party that a Mickey Mouse poor as a church mouse could win. The Liberals have done nothing to merit voter support but yet they remain close to the Conservatives at the polls. It is a race to determine who is the least disgusting.
There are no doubt many reasons for the Conservatives to call an election now but Flanagan puts a new spin on the election call and his reasoning is not without some merit. However Harper also probably wants to avoid possible poor results in byelections, further digging up of dirt by committees, and worsening economic times. Dion will have his opportunity to show that he has been underestimated by his opponents. If Dion does very well and is able to form his own minority or majority government I wonder if Harper will fade from the scene.

The Grits won't die - they'll just fade away
And if they're not careful, they could end up in a financial pit
TOM FLANAGAN
From Thursday's Globe and Mail
August 28, 2008 at 9:11 AM EDT
Carthago delenda est.
- Cato the Elder
Although the looming fall election seems mired in technicalities about election dates, the stakes are very high for the party leaders, especially for Liberal Leader Stéphane Dion. He has to do much better than Paul Martin did in the last election. He has to lead his Liberals to victory, or at least to such an improvement that the Conservative minority government is destabilized.
Anything less, and Liberal supporters, who have long been accustomed to winning, will be clamouring for his scalp.
But the party's precarious financial state makes the stakes even higher for the Liberal Party as an institution than for Mr. Dion as a leader.
Here's what we know about Liberal finances:
Their fundraising stinks. They raise only about $5-million a year, barely ahead of the New Democrats and less than a third of what the Conservatives can muster. They are surviving on their government subsidy - currently about $9-million a year, based on the 4.5 million votes they received in 2006.
They have borrowed $2-million from the banks to cover operating expenses. The national party's credit rating was so poor that wealthy constituency associations had to guarantee the loan.
Candidates from the last leadership race still owe about $2-million from their campaigns. Elections Canada has given them another 18 months to pay off those loans, but that is diverting fundraising efforts from the party to the candidates.
The Liberals can borrow the money they need to run a fully funded, $19-million national campaign - but loans have to be paid back. Their 50-per-cent rebate from Elections Canada will provide $9-million, but how will the rest of the loan be repaid? Here's where things get really dangerous for the Liberals.
Suppose Dion-o-mania fails to materialize and the Liberals get fewer votes than they did in 2006. Then their subsidy, already down to 86 per cent of what it was when the new system started in 2004, will fall even further. Yet, much of this declining subsidy will be dedicated to repaying their bank loans because Liberal fundraising will also fall; people don't like to give money to losers. And the banks can't agree to write off the loans or substantially soften their terms because that would constitute an illegal corporate donation.
Moreover, Mr. Dion - never very popular in his party - will be facing calls to resign. But that means a new leadership race, even before the debts from the previous one have been repaid, as the big boys - Michael Ignatieff and Bob Rae - square off for an expensive final slugfest.
The Liberal Party will undoubtedly survive the coming election, but it may emerge financially crippled, with the banks laying claim to much of its (now smaller) public subsidy, and fundraisers working to pay off debts from leadership races past and present.
The first order of business for any new Liberal leader will be to restore the party to financial health. Over four years, John Tory succeeded in doing that for the Ontario Progressive Conservatives, but provincial law allowed him to draw on corporate and high-end individual donations. Under federal law, however, the Liberals are confined to grassroots fundraising, which they have not yet learned how to do.
Against this backdrop, the Conservatives would appear to have a viable long-term strategy: force the Liberals to exhaust their limited resources in repeated battles.
Do you remember your ancient history? From a Conservative point of view, this is a rerun of the Punic Wars, with the Conservatives starring as the rising Roman republic and the Liberals cast as the evil empire of Carthage. In the first Punic War, the Romans took Sicily from Carthage; in the second, they took the rest of the Carthaginian possessions in Europe; and in the third, they defeated Carthage totally, razed the city to the ground and sowed salt in the fields so nothing would ever grow there again.
In the first Canadian Punic War, the Conservatives brought the Liberals down to a minority government; in the second, they pushed the Liberals out of government altogether, although they not did get their own majority. What will happen in the impending third Canadian Punic War?
Destruction of the Liberals is not at hand; there will be further sequels to this movie. But if the Liberals are not careful, they, like the federal Progressive Conservatives of sainted memory, could be pushed into a financial pit they can never climb out of.

1 comment:

Hermesacat Bob said...

Thanks for posting Flanagan's article I didn't see in August, but which I'm hearing about now. as it's so timely exactly 3 months later.

Harper's bombshell this week announcing his plan to do away with public subsidy of political parties, has set off a chain of events, likely NOT to bankrupt the opposition, as he and his mentor Flanagan had hoped.

Instead, Harper, Flaherty, Flanagan & Co. have miscalculated so badly, he's pushed the opposition into a position where the most likely outcome a week and a half from now is Harper and his gov't will be history, ousted and replaced by a coalition of Libs & NDP, supported by the Bloc, who've had enough of his partisan bullying!

The odds are slim they will back down on this, even as Harper attempts to undo the damage he's caused by trying to backtrack. It's already too late. The 3 parties are united now in a focused mission to destroy their nemesis before he destroys them!'Cause all Harper understands is war, not cooperation or compromise.

I love it. It will be such delicious irony and justice that the arrogant wannabe dictator Harper is cut down to size.

He will be taught a severe lesson demonstrating that in our system a minority gov't must gain the confidence of the House if it is to continue.
He now knows he can no longer get away with illegitimately ruling as if he had a majority, which he does not. The opposition parties together hold the majority.

If only Harper had put the interests of Canadians ahead of crass party politics, he'd have tried opting for cooperation with the opposition instead of continually throwing grenades across the House at them - and he'd not be facing immanent ouster from 24 Sussex Drive!

But since he's a bully, cooperation isn't in his dictionary or his nature. He's a self-serving partisan thug about to reap what he's sown, and get his overdue comeuppance!
Yippeeiokayay!