The Truth About Canada (45 page)

Now to some good news. Some
very
good news. An amazing revolution has taken place concerning money in politics in Canada, a revolution that is likely the most important development in political reform to take place in this country in generations.

The profound impacts of Jean Chrétien’s unexpected Bill C-24, which severely limits corporate and trade union political donations beginning January 1, 2004, remain to be fully recognized in much of the media, and hence by most Canadians. But it’s certainly now fully understood by
federal politicians, most notably the Liberals, who have long counted on the big banks, the big law and accounting firms, the big oil and other resource companies, and the wealthy in general to finance their party. What a shock for them that the Conservatives have now been pulling two, three, or four times as much money from roughly 10 times as many donors. Moreover, as a result of the new inflation-adjusted public subsidies based on the number of votes received in the 2006 election ($1.8725 per year per vote at this writing), the Conservatives received $9.4-million in public funding, $1.553-million more than the Liberals, while the NDP received $4.54-million.
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The new financing rules have had a huge impact on party financing. The Liberals have suddenly found that the “automatic” big-dollar corporate fundraising via “bag men” that they relied on so successfully for so many years is no longer possible. In 2005, 15,187 individuals donated to the Liberal Party, but almost four times as many people, 59,159, donated to the Conservatives. In 2006, the Conservatives recorded donations from the public of $18.6-million, the Liberals only $9.8-million.
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In the first nine months of 2007, the Liberal Party raised only $2.6-million compared to $12.1-million raised by the Conservatives.

(Chrétien’s completely surprising 2004 political financing legislation was one of only three really important things that he did while prime minister, the others being keeping Canada out of the Iraq war and the clarity legislation regarding future Quebec referenda.)

This said, all is not perfect. Unlimited secret personal donations are still allowed for leadership and constituency candidates as long as it is prior to acclamation, and while political spending is limited during a federal election there are otherwise no limits. (As well, there is a major loophole in the existing legislation which allows an individual to make contributions of $199.99 to every federal riding — a total of more than $60,000 — since riding associations are required to notify Elections Canada only when they receive donations of $200 or more. This loophole should be, and easily can be, closed.)

In March of 2005, I wrote to my e-mail list:

Canada has moved away from the terrible U.S. system where big corporations and single-issue lobbies ignore funding legislation by channelling enormous amounts of money for politicians through the PACs and the successful re-election rate of incumbents is laughable. If we could combine our own funding legislation with a mixed-member proportional representation system we’ll have gone a long way towards making Canada the kind of true democracy most of us want to see.

So, ignore those who suggest we go back to dark-age political financing rules. We’ve had enough of defence contractors, oil and forestry companies, law firms, accountancy firms, and the wealthy financing politicians with the inevitable results that our tax policies and our social policies fail to reflect the true wishes of our citizens as clearly spelled out, year after year, in poll after poll.

It’s time progressive policies not fat bank balances determined political leadership. Do we really want another Paul Martin or for that matter another Brian Mulroney and their big-money friends running the country?

The example of Paul Martin’s almost $12-million war chest in the campaign for the Liberal leadership was a perfect example of money from big business and big professional firms warping the democratic process. Martin’s millions, mostly from big corporations and their CEOs, made it virtually impossible for anyone else to mount an effective, competitive campaign. For Martin, $5,000-per-person cocktail parties were a norm. In March 2006 in Toronto, 2,000 people attended a Liberal fundraiser. Tables for 10 sold for $8,000. Most tables were purchased by large corporations, and a few by trade unions. The evening netted the Liberal Party $1.4-million.

So, in the past, before the recent reforms, what did it take to make a serious bid for the Liberal leadership? Probably a minimum of $3-million to $5-million, and often much more was spent and not reported. Belinda Stronach is reported to have spent $4-million on her campaign for the
leadership of the Conservative Party. The most recent Liberal leadership convention, in December 2006, had a supposed $3.4-million per candidate spending limit.

To the total surprise of almost everyone, in 2006 Stephen Harper not only continued the Chrétien ban on all donations from corporations and trade unions, but he also lowered the maximum donation from individuals from $5,000 to only $1,000. As of January 1, 2007, individual Canadians could donate up to a total of an inflation-adjusted $1,100 to each registered political party, and a maximum of an additional $1,100 per year to a registered political association or to contestants for nominations or constituency candidates, whether representing a party or running independently, plus a maximum of $1,100 to a party leadership candidate. This move by Stephen Harper astonished many observers. Equally surprising is the fact that Harper hasn’t abolished the tough limits on third-party election advertising and election donations, something he vigorously opposed before becoming prime minister. As well as corporations and trade unions, groups and associations can no longer make political donations, and cash donations exceeding $20 are no longer allowed.

The
Toronto Star
’s Carol Goar concludes:

No future prime minister will be beholden to corporate interests, as every national leader from Sir John A. Macdonald to Paul Martin has been to some degree. Big Business will never be able to mount another massive blitz, as it did in the 1988 election, to promote free trade with the United States. The era of $5,000-a-plate political fundraisers (at least at the federal level) is over.

Because this story has no single hero and no sudden breakthrough, it hasn’t made headlines. But from a citizen’s point of view, it ranks as one of the most positive — and surprising — developments of 21st century politics.

Who would have believed, at the dawn of the millennium, that Chrétien, who raked in millions at fundraising dinners, would pull the plug on corporate donations?

Who would have believed the Liberal party, whose president Stephen LeDrew denounced Chrétien’s plan as “dumb as a bag of hammers,” would enact the ban?

Who would have believed Harper, champion of free markets and opponent of government regulations, would retain and strengthen Chrétien’s reforms?

Who would have believed Broadbent, supported by the autoworkers for 14 years as NDP leader and 21 years as MP for Oshawa, would propose an end to political donations by unions?

Most of all, who would have believed that a political system tainted by the sponsorship scandal, infected by public cynicism and dependent on corporate largesse would be getting cleaner and more transparent by 2007?

There is still work to be done.

An area that needs tidying up is the definition of a political contribution and a campaign expense. As long as big-ticket items such as polling and convention fees lie outside the rules, there will be room for slippage.

On balance, though, Canada has come a long way in a remarkably short time.
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By the way, the United States is going in exactly the opposite direction. In a country that already had the most undemocratic big-money-dependent system of election financing, the U.S. Supreme Court in June 2007 further relaxed the ludicrously ineffective regulations relating to corporate and union political spending. The cost of the combined 2008 U.S. presidential and congressional elections is expected to break the $1 billion mark.

After the 2006 federal election, Fair Vote Canada said, “Once again Canada’s antiquated first-past-the-post system wasted millions of votes, distorted results, severely punished large blocks of voters, exaggerated regional differences, and created an unrepresentative Parliament.”

While at the federal level the reforms in political financing have been
profound, the prospects for reform of the voting system, despite promises to the contrary primarily from the Martin Liberal government, are at this writing about as remote as the chances of the Toronto Maple Leafs winning the Stanley Cup.

Journalist John Ibbitson sums it up: “To placate the NDP in this minority Parliament, the Conservatives promised in their Throne Speech to consider the question of electoral reform.”
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We now know how they planned to proceed. Those plans are hilarious. The Conservatives hired a Winnipeg-based conservative think tank to conduct focus groups. This same think tank has published articles arguing strongly against proportional representation and in favour of the status quo. Ibbitson says, and I agree, “Mr. Harper has not the slightest interest in considering the question of electoral reform. This charade is an act of political subterfuge calculated to disguise inaction.”

As Tom Kent, a distinguished professor at Queen’s University School of Policy Studies, has pointed out, the last Chrétien majority “was conferred by only one in four of the people who in 2000 were entitled to vote. In 2004, barely one in five of enfranchised Canadians cast Liberal votes, but that was enough for the party to enjoy the perquisites of office.”
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Now let’s turn to proportional representation (PR).

I’ve been saying for some 30 years that if we could only get a reformed political financial system that prevented corporations, trade unions, and the wealthy from dominating the financing of federal politics, and if we could combine that with a proportional representation electoral system, we’ll have gone a very long way down the road to making Canada a much better, fairer, more democratic country.

Well, we’re halfway there, and many of us who worked hard for the reform of election financing really didn’t believe it would ever happen. And certainly not with legislation introduced by a Jean Chrétien government. This said, once, to our surprise, we learned of the government’s intentions, we went to work as hard as we could to convince many skeptical members of Parliament that the changes being considered could be improved, could make Canada a much more democratic country, and would have the strong support of a large majority of Canadians.

I spent weeks working on my presentation to the House of Commons committee. When the full House of Commons and the Senate approved the new legislation I was overjoyed. And when Stephen Harper brought in an even tougher package of reforms, I was astonished and delighted.

The next half, proportional representation, will likely be more difficult. While Jean Chrétien surprised us all with Bill C-24, it should be remembered that in 1984, when running for the leadership of the Liberal Party, he told reporters he would introduce proportional representation “right after the next election” if he became prime minister. Fair Vote Canada tells what happened: “In 1993, Jean Chrétien wins the election and begins his ten-year reign as prime minister. In three elections, he never wins more than 42 percent of the popular vote, but still forms ‘majority’ governments thanks to the current voting system. He never gets around to introducing proportional representation.”

Let’s look at what happens in other countries.

Currently, proportional representation exists in over 80 countries, including Argentina, Austria, Belgium, Bolivia, Brazil, Chile, Colombia, the Czech Republic, Denmark, Finland, Germany, Greece, Hungary, Iceland, Indonesia, Ireland, Israel, Italy, Luxembourg, Mexico, the Netherlands, New Zealand, Nicaragua, Norway, Panama, Paraguay, Peru, Poland, Portugal, Serbia, Slovakia, Slovenia, South Africa, Spain, Sweden, Switzerland, Turkey, Uruguay, and Venezuela.

Pure proportional representation would have the number of those elected as an identical reflection of the percentage of the popular vote received. For example, if party X received 36 percent of the vote in a national or provincial or state election, it would get 36 percent of the seats in the parliamentary chamber.

But most countries have a mixed-member proportional representation system, where the voter casts two votes, one for the constituency candidate they favour, and the other for one of the party lists submitted by the political parties. This system was proposed almost 30 years ago by the Pepin-Robarts commission on national unity, and more recently, in 2004, by the Law Commission of Canada after a careful two years of
research, consultation, and discussion. Several provinces, including New Brunswick and Quebec, have been encouraged to adopt mixed-member proportional (MMP) systems for their legislatures.

The Law Commission, in a detailed proposal, suggested that two-thirds of all MPs be elected directly by their constituencies and the balance by proportional representation, using party lists to select the winners, based on the total number of votes received.
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There are variations to be considered in a mixed-member proportional system. Germany, New Zealand, Scotland, and Wales have 60 percent of the seats reserved for constituency representatives, and 40 percent are selected from party lists. Most countries with a proportional representation system require a minimum of 5 percent of the vote to elect someone to their parliament.

Studies show that countries with proportional representation have higher voter turnouts. One study suggested that with proportional representation 1.5 million more Canadians would be casting their vote. Fair Vote Canada reported in May 2004 that Canada had far more people not voting than voting for the winning party.