National Post all about Manley

Lifted from the post 2003


OTTAWA - As a former tax lawyer, head of the Ottawa Board of Trade and a strong advocate of moving the Liberal party from profligacy to prudence, John Manley has long been viewed as a right- wing, business-oriented Liberal, often at odds with his colleagues on economic and political issues.

As holder of such senior portfolios as Finance, Foreign Affairs and Industry, he has focused on systems, rules and outcomes that have often pushed the party in a direction it was reluctant to go.


"It's interesting that John Manley thinks in terms of policy while Paul Martin, almost instinctually, thinks in terms of how policy impacts on people," one party insider says. "It makes a difference, in the sense that Martin is more political and less definitive than Manley [on issues]."

But some supporters believe the full mettle of Mr. Manley has yet to be seen, and the race for the Liberal leadership, should he decide to run, will bring out dimensions that have so far been submerged.

"This is a guy with an intense social conscience -- that's why he is in the Liberal party and not the Reform party," says Bill Milliken, a former political aide to Mr. Manley and now a consultant with Temple Scott Associates Inc.

Tony Macerollo, Mr. Manley's long-serving executive assistant, recalls that when he first joined Mr. Manley in 1989, the initial project he worked on was a hunger-awareness program in Mr. Manley's Ottawa riding.

"He's very much a mainstream Liberal," Mr. Macerollo says, but one guided in equal parts by strong Christian values and recognition of the need for prudent fiscal management.

"A fiscally responsible approach is one that places us safely on the balanced-budget side, but at the same time says we don't exist as a government to just tally the books," Mr. Macerollo says.
The recent federal budget -- Mr. Manley's first as Finance Minister -- is a clear demonstration of this social dimension, Mr. Macerollo says, with its funding for health care, poor families and other initiatives.

This leaning was evident from the start. When the Liberals were in opposition in the 1980s, Mr. Manley often seemed uncomfortable with the stances taken by colleagues on such issues as deficit reduction and trade policy with the United States.

But, with the prospect of power in 1993, Mr. Manley -- often in alliance with leadership rival Mr. Martin -- pushed the Liberal party to take a more traditionally conservative view on economic and business issues.

"He was a major influence in the preparation of the economic- policy sections that went into the original Red Book [the Liberal Party's 1993 election platform]," Mr. Milliken says.

Appointed Industry Minister by Jean Chretien, the Prime Minister, Mr. Manley went to work to turn his ideas and convictions into policy. Immediately he was confronted by the amalgamation into his portfolio of several separate departments, among them Tourism, Consumer and Corporate Affairs and Science and Technology. As the Liberals embarked on eliminating the deficit, Industry lost nearly 50% of its budget.

"It was a department with conflicting corporate cultures because of the amalgamations," Mr. Milliken says. "It lost half its budget and over one-third of the employees were let go as part of downsizing."

Despite these challenges, Mr. Manley set about making profound policy changes.

"It was a fundamental shift away from the Department of Industry being the department of grants and contributions [to business] and regional economic development into a department that provided strategic intelligence, better, more streamlined regulations and getting business-framework legislation to work faster and better," Mr. Milliken says.

With Mr. Martin guiding fiscal policy, Mr. Manley concentrated on upgrading Canada's economic performance to become a more innovative economy. The strategy rested on creating knowledge, bringing it quickly to market, having skilled and trained people to implement it and rules and regulations that promoted rather than impeded business.

Some critics, however, believe Mr. Manley still represents a core Liberal impulse to control and direct the economy.

"I think he comes to government from a pro-business point of view and is a believer in wealth creation," says Walter Robinson, executive director of the Canadian Taxpayers Federation, which opposes corporate financial support. "But that being said, he sees government's role very much as an enabler, a partner, which shows up in support for Technology Partnerships [a program of industrial assistance] for the aerospace sector and for the pharmaceutical industry."
Financial support for big, successful industries such as aerospace is a bad use of taxpayers' money, Mr. Robinson says. But he concedes Mr. Manley has pushed issues such as productivity, the brain drain and matching the economic performance of the United States, even when his party did not want to deal with those subjects.

"Mr. Manley has usually been on the right side of tax policy, of having a more competitive personal and business tax environment.... If he can translate some of those issues into a leadership platform, he may have an audience," Mr. Robinson says.

But Mr. Manley has also shown himself as the kind of politician who can advocate taxpayers' dollars for professional hockey teams. His proposed scheme to help stabilize Canadian teams by protecting them against fluctuations in the dollar caused an intense public backlash.

"It was not his own proposal. He was pushed to do that ... by the PMO [Prime Minister's Office].... He was told to make a deal," Mr. Milliken says. "Alberta, Ontario, British Columbia and Quebec all agreed it was a good idea. The day he announced it and the ... hit the fan, they all hung him out to dry and he was left to take all the pies and tomatoes that were being thrown at him," Mr. Milliken says.

One of the policies of which Mr. Manley is most proud, Mr. Macerollo says, is getting the government to link Canadians together through Internet connections at every school and library in Canada.

Another key policy has been to promote university-based research and development -- a cornerstone in Mr. Manley's vision of Canada as a so-called Northern Tiger. The creation of special university chairs, a boost in grants and funding and support for building world- class laboratories will transform Canada into a knowledge-based economy, Mr. Manley believes -- though he admits the payoff for these investments will take time to realize.

"These are not short-term political kinds of things. They are long-term," he said in a recent interview on the budget. "We've been consistently at it since 1996, year after year ... building infrastructure, building on the research chairs, which give us a big boost in trying to attract talent."

The strategy is already bearing fruit, he says. Canada has posted the fastest economic growth among the G7 industrial countries, with improvement in private-sector R&D spending and a boost in the number of workers devoted to research.

Mr. Manley has also advocated an expanded role for small business and entrepreneurs in the Canadian economy, arguing Canada relies too much on a handful of large enterprises for its export trade. As industry minister, Mr. Manley provided small business with improved financial assistance, market information and regulatory measures that helped spur growth in the sector, says Garth Whyte, senior policy advisor with the Canadian Federation of Independent Business.

His approach to these issues, particularly the nature of the relationship between Canada and the United States, has carried over to his other portfolios. Nowhere is this more in evidence than in his handling of border and security issues after the Sept. 11 terrorist attacks.
"John Manley deserves a lot of credit. He's been the point man on that whole file," Mr. Whyte says. "Quietly, things have been getting done on customs, at the border, and Mr. Manley deserves a lot of credit in that area."

Nancy Hughes Anthony, president of the Canadian Chamber of Commerce, says business is thankful that among the Liberal Cabinet, Mr. Manley is a strong advocate of a comprehensive and strategic relationship with the United States at a time when the nations' ties have been under strain. Mr. Manley has criticized colleagues and Canadians for an unjustified, knee-jerk form of anti-American sentiment.

"He's been very proactive in trying to advise his Cabinet colleagues of the importance of the relationship, and when your biggest trading partner is down, you don't kick sand in their face. And that doesn't mean giving up on your sovereignty," Ms. Hughes Anthony says. "Some of the other members of the caucus I don't think understand the economic realities the way he does."
Mr. Manley's willingness to play up Canada-U.S. relations before a reluctant Liberal party is extremely important, Ms. Hughes Anthony says.

"I think that some people, after Sept. 11, think that with the 30- point border plan [a joint Canada-U.S. agreement on managing the border], that's all there is. In my view, [the border plan] is only the beginning, and we need somebody who is going to continuously work on that relationship and on the bigger issues [such as defence and trade]."

The nature of that relationship is part of Mr. Manley's larger sense of Canada as a mature, confident country on the international stage, Mr. Macerollo says.

"I think he would say that managing the Canada-U.S. relationship is about managing your sovereignty ... and part of that is you have to pay attention to not only your neighbour, but your largest trading partner, and it's not something you take for granted."

Canadian sovereignty is also one of the reasons Mr. Manley wants to replace the British monarch as Canada's head of state. His comments on the monarchy during the Queen's visit last summer raised a lot of ire. But cutting the apron strings is something Mr. Manley believes Canada must do as part of its evolution as a nation.

"He views Canada as a country moving from a position of strength and a country that is grown up," Mr. Macerollo says. "He certainly means no disrespect to the Queen and holds her in high regard."

Part two of a four-part series.; Tomorrow: Anne Dawson unveils the brain trust behind John Manley's campaign to wrest the Liberal leadership away from front-runner Paul Martin.; ; Profile of John Manley.
The National Post continues its series on John Manley, the Deputy Prime Minister and federal Finance Minister, in the wake of his first budget and the lead-up to his possible bid for the Liberal leadership. Today, Alan Toulin looks at Mr. Manley's approach to policy, and his determination to combine fiscal prudence with a social conscience.
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If anyone can find part one of this series, please leave a comment