Thursday, October 11, 2007

Shady dealings

A few notes on the equalization announcement yesterday by the federal and Nova Scotia Cons.

First, it's far from clear that the ultimate deal reflects any more generous offer by the federal government in order to get a deal done. Indeed, it was reported earlier this year that the federal offer at that time similarly contained no explicit downside while potentially offering an additional billion dollars over the life of the deal - double what the new deal apparently includes.

All along, the question was whether the federal government would actually stick to the deal offered by Harper. And from this angle, it still looks like MacDonald got the answer right the first time.

So what changed since the earlier offer? Obviously the federal Cons haven't done anything much to earn any additional trust in the meantime. But it seems entirely possible that MacDonald bought into the conventional wisdom (however flawed it may be) that with the Libs floundering, Harper's Cons will stay in power for some time to come - meaning that there was little prospect of a new federal government either offering a better deal, or overturning one agreed to by Harper.

Meanwhile, MacDonald likely recognized as well that the federal bargaining position wasn't about to change in his favour as long as Harper stayed in power. After all, the lone Con MP principled enough to stand up for his province had already been expelled, meaning that there was virtually no risk of in-caucus strife over the lack of a deal. Since Harper was obviously willing to pay the price in Nova Scotia seats for failing to keep the federal bargain before, there wasn't much reason to think that would change. And unlike Lorne Calvert, MacDonald hadn't shown any particular willingness to test the legal merits of his position.

As a result, MacDonald may have decided to simply take the best deal he could get on paper now in the hope that Harper (or a subsequent PM) would live up to it.

Based on the fact that the deal doesn't seem different from the previous federal offer, it's hard to give Harper much credit or blame for the fact that the deal happened. But the timing of the announcement has his fingerprints all over it.

In Atlantic Canada, the announcement figures to stop some of the bleeding following Danny Williams' successful anti-Harper campaign in Newfoundland and Labrador. (Though I have serious doubts that it'll actually improve the Cons' fortunes in Nova Scotia as some seem to think.)

And with a Saskatchewan election known to be in the cards, the deal also provides a signal to Brad Wall that Harper would very much like him to abandon any critical talk about the federal government in favour of a "Stephen Is My Sugar Daddy" strategy. Though I remain far from convinced that the result will be anything other than a backlash against both Wall and Harper.

What remains to be seen is whether MacDonald and Harper have calculated correctly in agreeing to the deal how and when they did. And it seems entirely possible that both minority governments will later regret their efforts to temporarily improve their standing now.

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