Michael Ignatieff

Bob Rae

Gerard Kennedy

Stéphane Dion

Ken Dryden

Joe Volpe

Scott Bryson

Martha Hall Findlay

It's been the forgotten issue of the Liberal leadership campaign: What to do to spur or otherwise sustain a Canadian economy, particularly one that looks to be losing some of its oomph?

Even when the candidates raged away at each other during their last formal pre-convention debate in Toronto, just a stone's throw from country's financial heartland, their concern for the economy was distinguished essentially by its absence.

It was as if the party brass organizing the event and the contenders themselves recognized one of the great unspoken truth of this race — that when it comes to the national economy none of those seeking to lead the Liberal Party of Canada have much in the way of Bay Street cred.

Eight candidates are left in the race that culminates on Dec. 2. But this time out, there are no ex-CEOs or former finance ministers among them.

Alone among the leadership contenders, only Nova Scotia's Scott Brison, a former public works minister and, briefly, investment banker (who had once run a small college business renting fridges), has been hammering away at economic issues, particularly tax reform, from the outset of the campaign.

For his pains, he has found himself in seventh spot in the eight-candidate race. But as the convention approaches and others are being forced to flesh out their economic platforms, Brison is also finding his policies being embraced by more of his rivals.

Frontrunner Michael Ignatieff, for example, has adopted at least three Brison proposals — to create a single stock market regulator; to develop a similar set of rules for small and medium-sized companies to do business across the country; and to find ways to use immigrant communities as a bridge to foreign markets.

Both Ignatieff and Bob Rae are also advocating the Brison (and Paul Martin-inspired) notion of a working-income tax benefit to help low-income earners keep more of their paycheques before taxes and certain social assistance clawbacks would kick in.

Where the Liberal candidates stand on the other big economic issues of the day, however, is sometimes a matter of trying to read between the lines.

Liberals and taxes

Business backgrounds

Of the eight contenders, only long-shot candidate Martha Hall Findlay, a Toronto-area lawyer and businesswoman has ever directly met a corporate payroll, as one of the founders of The General Counsel Group, a small legal consulting company for the telecom sector.

Ken Dryden was briefly president of Maple Leaf Sports and Entertainment but even his own website plays down that role in favour of his other achievements as a goalie, author and politician. Gerard Kennedy created and ran a $30-million-a-year food bank. But that relied almost exclusively on corporate goodwill and arm-twisting for its operational strength.

Scott Brison has a commerce degree from Dalhousie and was briefly a vice-president in an investment firm before he ran for Parliament in 1997.

As for the others, front-runner Michael Ignatieff and Quebec candidate Stéphane Dion were both well-known public intellectuals before entering public life, human rights and constitutional law being their respective specialities. Joe Volpe was a high school history teacher and a long-time Liberal party organizer before being first elected in 1988.

Bob Rae, of course, was premier of Ontario from 1990 to 1995 but that experience is more of a liability in the current context: Under his watch, Ontario took on more than $60 billion in public debt as Rae's neophyte NDP government tried fruitlessly to spend its way out of a worldwide recession.

This is Rae's weakest suit given his role in orchestrating some of the biggest tax increases in Ontario history, in some cases even as the provincial economy was tailing off.

But he has addressed this directly in recent weeks saying he was wrong then, as premier from 1990 to 1995, to try to tax and spend his way out of recession. Now, he says, he believes in cutting personal and corporate taxes to keep Canada competitive. See Rae's "Why Prosperity Matters" speech.

None of the Liberal candidates would raise taxes to pay for new programs. That era has passed. All talk broadly of cutting personal income taxes as the way of spurring Canadian productivity. Some have cited specific tax cuts they would bring in.

Brison has one of the more innovative proposals: To help young people get a stake, he would like to see the first $25,000 of their annual earnings be tax free for the first 12 years of their working life. He is also promising to cut personal income taxes and raise the basic personal exemption to remove low-income Canadians from the tax rolls. This was the approach of the pre-election Liberal budget a year ago, which the Conservatives gutted.

Stéphane Dion is promising two specific tax incentives to encourage research and development, particularly as it benefits small and medium sized firms.

Both Dion and Ignatieff, in a speech outlining his economic position, attacked the Stephen Harper government for what they called its politically driven, unproductive tax cuts, notably the one percentage point cut to the GST. But neither has said what he would do about these tax cuts if the Liberals are returned to office.

Nor have any of the Liberals promised to restore the tax-favoured status of income trusts, which the Conservatives have just done away with.

The Liberals have been harping on the promise-breaking aspect of the move. Harper pledged categorically during the January election campaign that he wouldn't tamper with income trusts, an investment vehicle favoured by fixed-income seniors. But Ignatieff, for one, conceded the income trust tax advantage had to be addressed.

Gerard Kennedy said that the change should include a longer transition period than the four years the Tories are promising as well as specific relief for any capital losses incurred by individual Canadians, which could be a substantial sum.

Productivity

Both Ignatieff and Brison want to see "federal leadership" towards a Canadian common market and a national stock market regulator, two issues that have been part of a 30-year fight to break down provincial trade and licencing barriers. Rae hasn't gone quite that far in his formal proposals (as a former premier, he probably remembers well the Quebec-Ontario construction worker standoff that dogged his tenure). But he would like to see broader acceptance of foreign-trained professionals, alluding perhaps to doctors, other health workers and engineers, which is another regulatory area under provincial jurisdiction.

Ignatieff, Rae, Ken Dryden, Kennedy and Dion also want to see Ottawa make larger, more direct investment in education and university-level research, which was a hallmark of the Jean Chrétien era. Kennedy and Dryden have talked about creating an education system with measurable national standards. But education is also an area of provincial jurisdiction and how Ottawa could do this without a tussle is not spelled out.

Joe Volpe, Ignatieff and Brison say they would like to see some sort of immigration system reform so as to better match prospective immigrants with the areas that need their skills.

Ignatieff, Rae and Brison are re-promising the Paul Martin government's working income tax benefit — credits for low-income earners so they are not penalized for moving off of social assistance or EI when they take low-paying jobs.

Rae and Brison also want to see changes to the EI system to assist those who move in and out of the workforce. Brison is proposing that those companies whose workers don't draw on unemployment insurance very often pay a smaller premium.

Debt

When it comes to paying down the national debt, Dryden has been the most explicit of the candidates. Most seem to see the debt-taxes-spending equation as a flexible one in which tax levels and debt reflect competitive pressures.

Dryden may have a more fundamentalist approach. He says a federal government has to continue to balance budgets and reduce our debt burden, increase national savings and keep inflation low and stable.

Ignatieff notes that under the Chretien-Martin governments, Liberals earned a (new-found) reputation for fiscal management. "Liberal governments have now got fiscal responsibility into their DNA," he says. "Get the fundamentals right; keep taxes competitive; don’t run deficits; pay down the debt. It's the credible mantra of any Liberal government.

"Every social justice commitment we make has to be paid for. Canadians won’t trust a government that doesn’t know how to make tough choices and live within its means."

This is essentially the mantra that Rae is now touting as well: That wealth creation can't be ignored if you want to talk seriously about social justice and helping the less well off.

"Economic prosperity must be of paramount concern," he told a Toronto business audience recently. "In particular, I've learned that economies can turn on a dime and so can spending and so can revenue. Nobody should want to go back to the days of deficits."

The green economy

This is the area Dion, the former environment minister in the short-lived Martin government, has tried to stake out for himself. See https://stephanedion.ca/?q=en/taxonomy/term/19

Dion has talked about a three pillars approach to governing in which economic development, social spending and environmental concerns would go hand in hand in hand. At a minimum, it would suggest a stronger environmental review process whenever a big development is put forward, though this was an approach that bogged the Brian Mulroney government down in the 1980s.

Virtually all the leadership contenders favour some way to encourage investment in the latest green technologies, though in most cases there is little in the way of specifics.

One of the more intriguing questions is whether anyone will advance the notion of a carbon tax, as the Quebec and British governments are doing, to try to move consumers away from fossil fuels.

Ignatieff threw the carbon tax idea out there in the early going but since appears to have backed away in the face of a backlash from Western Canada. Kennedy wants to see punitive taxes on gas-guzzling cars to offset tax breaks for hybrids and other energy-saving vehicles, which is a kind of micro-version of the carbon tax. Dion has said he would like to introduce a variety of industry-wide polluter-pay taxes, the revenue from which would be plowed back into the respective sectors to help pay for clean technology and emission controls.

He is also promoting a series of environmental tax credits, including a $3,500 tax credit for those who buy an energy efficient home, and a "green loan," which would make interest charges tax deductible on any investment that would improve energy efficiency.

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