Social Policy in Ontario

McGuinty proves father knows best

Posted on October 11, 2011 in Governance History

Source: Globe & Mail — Authors: Andrew Steele

TheGlobeandMail.com – news/politics/second-reading
Posted on Tuesday, October 11, 2011.    Andrew Steele

Dalton McGuinty consistently exceeds expectations.

Written off as the fourth place candidate in the 1996 Liberal leadership, McGuinty refashioned himself as the safe second choice, coming up the middle to win. Written off as “not up to the job” in 1999, he rallied his party in the last ten days of the election to record its second highest percentage of support in sixty years.

Written off after raising taxes in 2004, he focused his government on improving health and education services, which produced tangible results and a turn around in the polls. Written off after eHealth, he threw himself at the global recession, luring investment, launching the Green Energy Act and harmonizing the sales taxes.

The opposition and media expected the Liberals to hide the Premier in this election, when he turned out to be the party’s biggest asset. The advertisements were all about McGuinty, warts and all, explaining the record and the next steps. More impressively, he had the courage to introduce a platform that underbid the opposition parties, pledging to spend significantly less than the NDP or PCs.

Watching him on the stump, McGuinty is calm and self-assured. Much of the credit for the Liberals’ success last week belongs to Dalton McGuinty. But more than electoral accomplishments, McGuinty stands as the transformative Premier of the last twenty five years.

The massive extent of McGuinty’s policy reforms is underestimated like the politician. His major changes are comparable or greater than any of the tax cuts or mergers of Mike Harris, the social contract of Bob Rae or constitutional reform attempts of David Peterson. More importantly, they were quickly adopted as consensus with no opponent running against them in the next election.

During the debate about instituting the HST, naysayers said Ontarians would never accept the complex debate of raising consumption taxes while cutting corporate and personal income taxes. Two years later, the HST is here to stay (and Ontario is the most competitive jurisdiction for starting a business in Canada).

During the debate on the Ontario Health Premium, naysayers said the benefits of financing shorter wait times would be lost on Ontarians. Seven years later, the Ontario Health Premium is here to say (and Ontario has the shortest wait times in the country).

From phasing out coal plants to the Greenbelt, naysayers said special interests would ensure Ontarians never gain the benefit of clean air, soil and water. Years later, no party openly opposes these new cornerstones of wise stewardship (and Ontario experienced hardly a smog day in the hottest summer in memory).

The Liberals have managed to stay relevant in 2011 solely because they took big risks. Tax reform gave them a compelling storyline about the economy, one that their opponents subliminally reinforced by pledging only tinkers with the HST.

Ontario’s current education system is a beacon to policy wonks, and is such a political strength for the government that the opposition barely discussed it during the election. But we forget the uphill battle of arguing for smaller classes and lowering the dropout rate when McGuinty first proposed them.

Perhaps the best example of a big risk is the Green Energy Act.

After decades of neglect, Ontario’s energy generation fleet was nearing end of life. Seeing the danger in rebuilding of Ontario’s energy grid on fossil fuels in a potentially carbon-taxing global economy, McGuinty chose to instead jump start a local green energy industry.

McGuinty continually doubled down on this strategy. He demanded transmission and distribution companies hook up green power projects. He put arduous domestic content rules on suppliers to force investment. He made a strategic deal with Samsung to make Ontario the home of the global green energy arm.

The plan leaves Ontario with higher than average energy prices… until there is a price on carbon. When climate change forces carbon pricing, Ontario will have the cheapest electricity in the Great Lakes region.

But the Green Energy Act also made perfect sense as political strategy.

The NDP made a significant decision in 2009 when selecting Andrea Horwath as leader over Peter Tabuns. Horwath was offering to continue the Hampton strategy of winning back the urban and industrial seats in Hamilton, Windsor, west Toronto and the North, while Tabuns was offering a more audacious move to go after the Green vote and add it to the NDP base. NDP supporters chose the safer option of being a larger opposition party rather than shooting for government any time soon.

At the same time, the PC Party moved right with Tim Hudak, closing any option of reconciliation with Ontario’s growing Green vote. (I wrote about these decisions and the coalitions of each party extensively here.) The door was open for Dalton McGuinty to go after the 8 per cent of Ontarians who were voting Green while motivating his own base.

Let’s put that 2007 Green vote into context. The Greens got almost half as many votes as the NDP. Their total vote was close to the size of the margin between the PCs and the Liberals. And their voters – knowing they are not going to elect a single MPP – still walked themselves to the polls with very limited Get Out the Vote efforts and next to no television advertising.

That is a vote that is policy-oriented, highly motivated, and worth going after.

By launching the Green Energy Act, championing it so personally, taking the risks of the Samsung deal, and pushing his traditional opponents to take anti-environmentalist positions, McGuinty was making a clear and unequivocal pitch to Green voters to join his coalition. By calling for taking the HST of gasoline and playing footsie with wind energy opponents, Ms. Horwath rejected any rapprochement with Green voters. By pledging to repeal the Green Energy Act and the Far North Act, Mr. Hudak chose to run openly against environmentalism.

This created a dynamic where the election was to some voters a referendum on the environment. And those voters were often the highly-educated, highly-motivated greens of 2007. These are the kind of people who watch debates and respond to passionate championing of the environment (perhaps with a generous dose of hand gestures.)

If you look at the polls, you will see a simple dynamic.

Tim Hudak is basically holding the core of the PC Party, a very similar group to what John Tory or Ernie Eves was left with on election day: rural and suburban conservatives. Andrea Horwath added to the NDP base a portion of the old Liberal coalition that feel marginalized and angry: people living in the de-industrializing segments of Northern and industrial Ontario, in places like Elliot Lake and Hamilton.

Another part of that segment just stayed home, a big driver in why turnout fell so fast.

But the Liberals have held on by partially making up for that segment of the population with half of the former Green voters of 2007. The Green vote fell by half, mainly shifting to the Liberals. And that 4 per cent of the vote was the margin between a major minority and losing.

The lesson of the McGuinty years is that big initiatives succeed. The reverse of this rule is that when the McGuinty government relaxes, it gets into trouble.

Arguably, the least productive period of Mr McGuinty’s tenure was the year after he won reelection in 2007. Exhausted by a turbulent first term, facing a weak opposition with leadership divisions, and aware of the looming global recession, the government chose to hunker down and play defence.

This period saw a drift that put reforming prayer in the legislature and the debate over afro-centric schools at the top of the agenda. It was in this time that the problems of eHealth were born. When the McGuinty government tried to just manage events, that was exactly when events got away from them.

Given the privilege of a third term, the lesson for the McGuinty Liberals is simple: Do big things.

Facing a potential double-dip recession, a stubborn deficit and unrequited demands for better services, the government will need to take on entrenched interests to improve the lives of average Ontarians. Standing still will mean watching the debt skyrocket, leaving the government vulnerable to interest rates and running short of options.

Token changes will sap political capital while distracting them from the key decisions. Now is the time for action.

The reality of the new “major minority” is that standing still will lead to defeat for the Liberals. They will have to take a page from Stephen Harper’s minority era and relentlessly drive the agenda.

A stand-pat budget in 2012 with some cutesy political tokens to buy the support of an opposition party will only guarantee defeat in 2013 in the house and on the hustings. The deficit will only explode if left alone, forcing a bad news budget down the road. The only choice is transformation of public services and finances in 2012 that will put the fiscal situation on the proper track and make later budgets easier, not harder.

Those expecting Dalton McGuinty to slow down and work on his legacy are falling into a familiar routine. They are underestimating him.

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Tags: economy, globalization, ideology

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