Joe Oliver's replacement of Jim Flaherty reassures Bay Street: Greg Weston
With Flaherty gone from Finance, PM now has few who say no to him
In tapping 73-year-old Natural Resources Minister and former investment banker Joe Oliver to replace retiring Finance Minister Jim Flaherty, the prime minister has apparently opted for public confidence over personal charisma in an attempt to reassure Bay Street — and Canadian voters — that the economy is being passed from one seasoned hand to another.
At risk is the Conservative brand, built on a perception of economic stewardship.
- Joe Oliver to replace Jim Flaherty as finance minister
- Jim Flaherty, federal finance minister, leaves cabinet
- Flaherty praised for prudent fiscal policy, steady hand in crisis
That is the party’s political strength, and with the next federal election barely 18 months away, no one was more closely associated with the fiscal brand than Flaherty, the only finance minister the Conservatives have ever known in power.
Suddenly he’s gone, that wry Irish twinkle giving a final farewell wink to politics and the prime minister.
It was not his difficult health problems of the past year, said Flaherty. At 64, it was just time to go.
Stephen Harper could have turned to any of a half-dozen relatively young, charismatic achievers on his front bench to take over the powerful finance job.
But with an election only 18 months away, Harper evidently wanted a business veteran at the helm, and most of the one-time big Conservatives of that description are gone: Jim Prentice, David Emerson and now Flaherty.
Joe Oliver may be a political newbie — the Toronto MP having been first elected in 2011 — but there is simply no one else in the Conservative cabinet with his blue ribbon credentials: a Harvard graduate who spent much of his career as an investment banker with Merrill Lynch; past president of the Investment Dealers Association; former executive director of the Ontario Securities Commission.
Harper may have also seen Oliver’s move out of the natural resources portfolio as an opportunity to lower the temperature of public debate around some of the government’s hottest energy files, especially those dealing with pipelines.
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Oliver’s sometimes divisive style and over-heated rhetoric disparaging environmental groups and others opposed to major pipelines has not been helpful to the government’s gaining public support for either the Keystone XL or the Northern Gateway projects.
In Natural Resources, he will not be missed by many.
Barring a major economic upheaval, Oliver’s job at finance should be relatively straightforward between now and the next election.
Flaherty has put the treasury on track to break even — some say, it already has. Oliver simply has to stay the course.
Oliver’s first and possibly only major preoccupation will be to help craft the next federal budget roughly a year from now, effectively setting out the Conservatives’ fiscal election platform for the campaign in the fall of 2015.
Given the myriad voices that will be vying for input into that budget — Conservative campaign strategists, officials in the Prime Minister’s Office, individual ministries, special interest groups — Oliver may have trouble just being heard.
Didn't always agree
What the new finance minister is not likely to have is the same relationship that Flaherty and Harper developed over their eight years together in power.
As Flaherty recently pointed out in a CBC News interview, he and Harper didn’t always agree on issues, but “I could usually get him to come around to a position I could live with.”
Most other ministers dare not even try.
On some major issues, it is hard to believe Flaherty wasn’t simply overruled, or at least pressured into positions not his own.
The government’s reversal on income trusts, wiping out billions of dollars of investments, was clearly not Flaherty’s alone.
Likewise, it is difficult to imagine that the budgetary disaster introduced after the 2008 election was not at least partly written in Harper’s office, a federal fiscal plan so inept it almost brought down the government in what became the coalition crisis.
Among other matters of scorn, two months after the crash, Flaherty was still predicting Canada would run surplus budgets as long as he was finance minister.
Less than two months later, he was announcing the government would likely run deficits peaking at about $50 billion.
Government insiders often point to the massive government stimulus spending that created those deficits as one of Flaherty’s toughest fights with his own party — and ultimately one of his most notable triumphs.
Former junior finance minister Ted Menzies, who quit the government last year, worked for years with Flaherty and is effusive in his praise.
Leadership and guidance
“A lot of people don’t know the challenges he faced — and faced down — during the 2008 economic crisis,” Menzies said.
“He even provided leadership and guidance to other foreign finance ministers.”
Six years later, Flaherty’s legacy will surely include the country’s emerging from a sea of red ink and back into the black.
Last month, in keeping with a long tradition of finance ministers, Jim Flaherty bought new shoes for the reading of this year’s federal budget — a budget that would prove to be his last.
On that day, two realities already seemed abundantly clear:
It wouldn’t be long before those shoes were walking out the door and leaving politics behind.
And they would surely be big ones for anyone to fill.