Canada's Liberals Face Post-Election Shake-Up

Written by David Frum on Saturday April 30, 2011

The Liberals are unlikely to lose as badly in 2011 as the old Progressive Conservatives lost in 1993. But they may be facing the same kind of identity crisis.

Polls are sometimes wrong. Voters sometimes - often, actually - change their minds during the final weekend of a campaign. That said: Canada looks headed for a startling election outcome on May 2:

1) An expanded Conservative government, falling short of a majority;

2) An NDP opposition, based in Quebec;

3) A deflated BQ;

4) And a Liberal party consigned to third place in the House of Commons.

What happened? What will it mean? Some early guesses:

First, don't blame Michael Ignatieff too much. The Liberals lost their predominance in Quebec in 1984. They finished second in Quebec again in 1988, again in 1993, again in 1997, again in 2000, again in 2004, again in 2006, again in 2008. See a pattern? They finished second under the Anglophone John Turner, under the Francophones Jean Chrétien and Stéphane Dion, and under the bicultural Paul Martin. If under Michael Ignatieff they drop from second place in Quebec to third, that looks a lot more like the continuation of a pattern than an individual catastrophe.

Second, don't credit Jack Layton too much. The NDP did not earn its Quebec surge. It did not recruit good candidates, it did not build an infrastructure in the province. Layton is the beneficiary of political change, not its author. The NDP is campaigning on a promise of regional redistribution: higher taxes on energy in order to finance more social welfare and more subsidies to favored industries. No surprise that promise appeals to Quebec!

If you want to credit anything, credit a mega-trend in the Canadian economy. Canada used to be a big Michigan: a manufacturing economy with some resource industries attached. Suddenly Canada finds itself a big Norway: an energy economy with some services and manufacturing attached.

The Canadian dollar has surged, bestowing a higher standard of living on Canadians who can benefit from the energy sector. However, that high dollar also has carved a big question mark over the future of manufacturing Canada -not only the auto belt of southern Ontario, but also the aviation and pharmaceutical industries of Quebec.

How does Bombardier now compete with Embraer? How long can Pfizer and BristolMyers and Squibb refrain from moving their pill production to India?

This change in the Canadian economy is shaking Canadian politics. Those regions that feel they are losing ground want more help from government than the Liberals will give. Those regions that are gaining ground want less government intervention than the Liberals can accept.

The old Liberal game -- campaign left, govern right -- no longer works. The prospering parts of Canada no longer trust Liberal governance. The distressed parts of Canada are no longer satisfied with Liberal campaigning. The Liberals used to hold the center, both geographic and ideological, and squeeze the margins. Now the margins are having their revenge: It is the center that is being squeezed.

The Liberals are unlikely to lose as badly in 2011 as the old Progressive Conservatives lost in 1993. But they may be facing the same kind of identity crisis. They will have to find a new leader, a new strategy and a new message. Discovering those new formulas will take time.

Which raises a fascinating question about what happens on the day after the election.

Imagine that the voting produces the following plausible result: Conservatives 150, NDP 80, Libs 50, Bloc 28. (This is not a prediction, just a hypothesis.) What happens then? Will the Liberals join with the NDP to bring down the Conservatives and install a government in which the Liberals are junior partners to the NDP? Who would be the acting Liberal leader and deputy prime minister? The damaged Michael Ignatieff ? Bob Rae? That would create a government led by an NDP prime minister and a former NDP premier -- suicide for the Liberal brand and the Liberal future.

The Liberal back bench will have to prefer a Conservative government supported by Liberal votes to a subordinated Liberal role in an NDP government. Especially since that Liberal-NDP government will also need the consent of the Bloc: again suicide for the Liberal brand and the Liberal future.

So this NDP surge may actually succeed in producing a third Conservative minority, but one that is actually even stronger and more stable than the Conservative minority of 2008-2011.

If so, that wouldn't be the best possible government for Canada. But it would be a decent runner-up.

Originally published in the National Post.