Never had a French-Canadian premier been so repudiated by his own province. Chretien had always offended Quebec’s intellectual elite, and nationalists would never forgive his role as Trudeau’s bulldog in 1980 and 1982 or his opposition to the Meech Lake Accord in 1990. In the rest of Canada, however, these roles were seen as proof of his honesty and combativeness. Only the Liberals had elected mps in every province and every region. Chretien was better tuned than most to the mood of Canada in the 1990s.
He had seen how an era of favours, kickbacks, backroom deals, and slush funds had become the “sleaze factor” that rotted public respect for Mulroney and his government. Chretien and his wife Aline immediately announced that the used furniture was good enough for their official residence on Sussex Drive. Meanwhile, the Prime Minister trimmed his Cabinet to 23 ministers, each with no more than half a dozen aides. Mulroney had needed 38 to 40 ministers, each with a platoon of assistants. Chretien also cancelled an allegedly gold-plated Tory deal to buy new naval helicopters and sell Toronto’s airport to wealthy pals. Both decisions would eventually cost taxpayers heavily.
Chretien’s priority was cutting a deficit that had grown to $42 bUlion since 1974. Experts warned that otherwise Canada would risk losing its membership in the G-7 nations and intervention by the International Monetary Fund, humiliations intolerable to a First World nation. Pre-election pledges to kill the goods and services tax and reneGotiate or quit Mulroney’s 1989 Free Trade Agreement were forgotten. Chretien’s chief economic agent was Finance Minister Paul Martin, his leadership rival in 1990. The son of a major architect of Canada’s original welfare state, the younger Martin embodied Chretien’s less overt business ideology. The recession of the 1990s had changed Canadians’ shrinking belief in a “common interest.” Influenced by New Zealander Roger Douglas, a convert to small government, Alberta’s Ralph Klein had persuaded his Alberta voters—who were spending more on social programs than they wanted to pay— to applaud cuts in health, education, and welfare. FFis popularity soared. Chretien and Martin took their cue.
In the 1994 federal budget, Martin plugged some minor tax loopholes, froze federal taxes, made unemployment insurance harder to get, and forced major spending cuts, especially in defence and the CBC. Critics were muted: most had urged deeper cuts. Fie obliged. In 1995, Martin eliminated $2.3 billion in business subsidies and warned
45,000 civil servants to look for other work. Federal transfers to the provinces for health, welfare, and post-secondary education were cunningly combined as a single Canada Social Transfer and drastically cut. Public investments—from Petro-Canada to Canadian National Railways to air traffic control—were ordered to be sold off. The 98-year-old Crow’s Nest rate finally died, with a one-time $1.6 billion pay-off for prairie farmers. In 1996, Martin promised that the federal deficit would vanish by 1998. His main victims that year were future old age pensioners—higher premiums and lower benefits fell only on those who were under sixty. Reform and conservatism were setting the Liberal agenda. Left-wingers had to be content with firearms control, a few
Jean Chretien, with his wife Aline, arrives at Rideau Hall to accept the Governor General’s invitation to form a government. The “little guy from Shawinigan” had risen to wealth, power, and Canada’s highest political office at a time when his country was threatened as never before by its own internal disunity.
Concessions to gay rights, and earnest speeches about Medicare while the necessary funds were carved away. Who cared? By the end of 1996, Liberals claimed 63 per cent support in opinion polls.
Chretien’s ministers followed orders. New Brunswicker Doug Young handed over most of Canada’s publicly built airports to local operators. Users, not taxpayers, would foot the bill for air traffic control. Closing unprofitable rail lines saved $2.3 billion in subsidies. Ron Irwin promised that his Department of Indian Affairs would vanish as responsibilities were transferred to band councils. By 1995, 84,000 Manitoba Natives faced self-government with $4.8 million in start-up funds. Even the Chief Electoral Officer economized with new permanent voters’ lists. Officials scoffed at warnings that Canada’s traditional high turnout rates would fall. When they did, voters got the blame.
As human resources minister, Lloyd Axworthy renamed “unemployment insurance” as “employment insurance” (ei). No longer a life-support for repeat users, its benefits and entitlements were cut, and retraining became obligatory. Business found a sideline. “Job-creation grants” spread billions of dollars. Who measured results? Axworthy cut $7.8 billion from the deficit and turned ei premiums into a major revenue source.
Since the 1960s, Ottawa had helped provinces finance universities and colleges. The new focus was to entice banks to provide bigger student loans. Except in Quebec and British Columbia, universities sent fees soaring. Students now graduated burdened with degrees, diplomas, and debts their parents had never known. Policy makers spoke wisely of “income-contingent” repayment. Those with little or no income stayed in debt. It was a far cry from the idealism of the 1960s.
World History
