It is said that our Prime Minister, Stephen Harper, is a brilliant political strategist. To be sure, he has proven adept at the science of segmentation, fastidiously identifying the slices of the Canadian electorate who can be coaxed into his coalition with this tax credit or that legisla- tive amendment. Those in his entourage who purport to understand the end of these means explain that Harper desires nothing less that a realignment of Canada’s political spectrum, one where the Conservatives supplant the Liberal Party as Canada’s ”œnatural governing party.” Every announcement, indeed every utterance, is one brick more toward the construction of a Conservative château fort in the political centre.

The Conservatives have built a political machine equal to their ambitions. By ruthlessly targeting ridings and voter segments, and ”œnarrowcasting” to their political base, the Conservatives have constructed a coalition of rural and small-city Canadians who can be relied upon to give gener- ously of their money and their votes. This coalition, it seems, demands nothing more than the meagre policy offerings and lower taxes on offer from Canada’s ”œnew” government.

Liberals must respond by modernizing their political infrastructure and defining a focused vision for Canada’s future. While the base is strong, and the ”œbrand” remains potent, the Liberal Party delayed for too long the mainte- nance on one of the Western world’s most vaunted political machines. The result? The party lacks appeal in much of rural Canada, in Quebec and in western Canada. Fundraising lags far behind the Conservatives. Policy renew- al at the grassroots has not yet begun in earnest.

Fortunately, the solutions to the challenge of party mod- ernization are well-known and accepted. In fact, the party, at its 2006 leadership convention, adopted a modern- ized structure in the form of a new party constitution. While implementation of the new structure has been slow, there are recent signs of progress. This progress must continue, and include:

  • adopting modern database management and fundrais- ing practices, using a national platform;

  • decentralizing organizational responsibilities to provin- cial wings of the party, and maintaining active associa- tions in all 308 ridings;

  • giving riding associations a meaningful role in policy development; and

  • standardizing membership policies and practices across Canada.

Getting on with the job of party renewal is essential. Canadians will rightly want to judge the Liberal Party on its ability to rebuild, attract new members and new candidates, and to increase donations. While at times daunting, none of these things are beyond our ken as Liberals " they are just hard work.

Ultimately, Liberals have a far greater challenge " that of defending the broad Canadian mainstream base from which it has constructed its great victories and proud legacy. This base has consisted, and must continue to consist, of Canadians from all walks of life, from every region, ethnicity, language and gender.

To achieve this, some will want to respond with a vision of a newly assertive, ambitious government, involving new spending priorities and even by ”œuniting the left” behind an interventionist set of policies. In my view, Liberals must resist the urge to retreat to a barren political left with its outdated ambitions of grand new national programs, dollops of new spending and bigger government. The Canadian political mainstream has long since left these notions behind. Rather, the party must decide on a focused set of priorities designed to maintain national cohesion and social progress, while growing Canada’s economy and responding to the dual imperatives of coping with demo- graphic change and responding to a changing climate.

For his part, Prime Minister Harper is placing a rather large bet on Canadians being prepared to accept a much smaller national government. For beyond the boutique policies like ”œbans” on street racing and deductions for transit passes, the Conservatives have severely constrained the future role of the government of Canada by starving it of revenue. Harper’s adviser Tom Flanagan calls it ”œtightening the screws.” However one describes it, fed- eral government revenues have indeed been reduced by tens of billions of dol- lars annually, mainly through a two- point reduction in the Goods and Services Tax, and billions more have been added to transfers to the provinces. Debate on this most funda- mental of issues has been muted, and certainly hasn’t penetrated public con- sciousness. Ultimately, though, this appears to be a debate Harper is eager to have.

It is a debate the Liberal Party should be eager to join. How the Liberal Party responds to Mr. Harper’s smaller, narrower federal government will be the key to recapturing the broad mid- dle of Canadian voters. However, we should avoid defending the ”œbig government” side of a big vs. small government debate. That is Mr. Harper’s terrain. Rather, Liberals can and must point to plans for a focused government, one that can respond to the country’s urgent economic and other priorities without resorting to vast new structures and complex programs.

Such a government would nonetheless address crying needs, most of which do not fit in the ideo- logical, to say nothing of the fiscal, framework of the Harper Conservatives. All contribute to achieving the economic prosperity that assures Canadians that our country’s social progress can continue. None are particularly original, yet all are aimed at attracting broad, mainstream electoral support, and focusing on the economic anxieties of a rapidly changing world. They include:

  • Modernizing the functioning of the Canadian economy. Liberals should offer real leadership on elimination of interprovincial trade barriers. Already, Ontario and Quebec, and British Columbia and Alberta, have announced significant initiatives in this regard. It is the proper role of the federal government to encourage these initia- tives and make them truly national. At the same time, the lack of a national securities regulator has made Canada a regulatory backwater in a world where billions of dollars move around the world in nanoseconds. A Liberal government should assert a federal role in regulation of markets and elimination of barriers to trade, in the name of creating economic opportunity for all Canadians and as a sine qua non of future discussions with the provinces.
  • A renewed focus on infrastructure. Signs of Canada’s outdated infra- structure are everywhere " crowd- ed highways, decaying universities and clogged sewer systems. With an eye to the environment and to job creation in every region, Liber- als should commit to accelerated infrastructure renewal. Specific attention should be paid to ensur- ing that our telecommunications infrastructure is extended to rural Canada, and to contributing to an east-west energy grid, so that far- flung indigenous energy sources can get to markets across the country.

  • Modernizing the federal government. While in government, Liberals initiated a process of expenditure review, described by one deputy minister at the time as ”œallocating the bottom 5 percent of spending to the top 5 percent of priorities.” While this was a laud- able initiative, why stop there? Why not 10 or 15 percent? Without setting out to shrink the feder- al government, Liberals should commit to realigning federal gov- ernment priorities with those of Canadians. At the same time, gen- erational change will open up thousands of opportunities to bright new public servants, who should be empowered to re-imag- ine the government they will be called upon to serve. To be sure, there are many federal institutions (to wit, the passport office) that are in crying need of reimagination.

  • Comprehensive tax reform. Cana- da’s tax laws have become unwieldy and full of loopholes. Successive governments have contributed to a tax code that is inaccessible except to a select group of lawyers and accountants. The Harper propensity for tax credits designed to appeal to specific constituencies has compound- ed the morass of code and exception. Liberals should commit " once and for all " to a comprehensive sim- plification of Canadian tax laws and to elimination of unfair loopholes. This commitment, of necessity, would be accompanied by a clear commitment to revenue neutrality.

  • Confronting demographic change. Canada needs new workers and skills, and needs them quickly. The baby boom generation is entering its retirement years, leaving behind fewer and fewer Canadians to pick up the economic and social slack. The reality is that Canada will need to throw open its doors to new immigrants more widely than it has ever done before, to ensure that the country continues to grow and possesses the skills needed to innovate. Liberals, always the party of immigration, will need to present a compelling case to Canadians for attracting, welcoming and helping to integrate new citizens from all over the world.

  • Industrial and agricultural policy for a new century. The Harper government has steadfastly refused to support specific industries and sectors, even in the face of a high dollar and emerging threats from other countries. Canadians must be reminded of the role of govern- ment in stimulating the resource, manufacturing and high-tech businesses that employ them today. Liberals should not be afraid to ask Canadians to support an industrial and agricultural poli- cy that will lay the research, skills and regional development frame- work that will create the jobs of tomorrow.

  • Finally, climate change. Consis- tent with a new industrial policy would be a world-beating com- mitment to reduce carbon emis- sions and to promote innovation on a national scale. Ultimately, most world experts agree, no solution to curbing greenhouse gas emissions will be successful until we put a price on carbon. Canada can, and must, devise a pricing regime that results in our achieving our share of reductions. Moreover, Canada must, through its tax and industrial policies, attract some of the tril- lions of dollars in venture capital that are being invested in green technologies and become a world leader in environmental innova- tion. Canadians should not expect a painless transition to a greener economy, but they will trust a Liberal government to manage that transition.

As the prosperity and growth asso- ciated with the 1990s and early 2000’s begins to fade from view, Liberals will need to offer eco- nomic prescriptions designed to fortify Canada through uncertain economic times and build toward a hopeful future. Liberals can point to a proud legacy of economic management and innovation over the course of the Chrétien/Martin governments. This economic and managerial credibility is hard-won and must be nurtured and defended. Today, Liberals must embrace big chal- lenges without embracing bigger government.

For unless Liberals are willing to wait for Harper’s Conser- vatives to defeat themselves, we will need to appeal directly to the broad middle: former Progressive Conservatives, Liberals and disaffected New Democrats. As Canada enters uncertain economic times, this coalition will be motivated by a focused vision of government, one that has our future prosperity as its principal tenet. Recentring the Lib- eral Party means staying true to our legacy of good management and to our willingness to tackle the chal- lenges the Conservatives dogmatically refuse to confront.