Cablegate: Canada: Could Gomery Revelations Trigger An

This record is a partial extract of the original cable. The full text of the original cable is not available.

051901Z Apr 05

UNCLAS SECTION 01 OF 03 OTTAWA 000999

SIPDIS

SENSITIVE

E.O. 12958: N/A
TAGS: CA PREL PGOV
SUBJECT: CANADA: COULD GOMERY REVELATIONS TRIGGER AN
ELECTION?

1. (SBU) Summary: The possibility of early elections has
always been in the background for this minority government,
but the revelations coming out of the Gomery inquiry over the
past several days have moved that possibility to the
foreground. Testimony by ad executive Jean Brault, which
remains under a publication ban but leaked out through a US
website, was characterized by Deputy Conservative Leader
Peter MacKay as something that, if verified, could &blow the
doors right off this government.8 It is still anything but
clear how this will all play out but there are huge equities
involved -- for all the parties, for party leaders, and for
the future of Quebec and separatism. All parties are
rattling sabers, but they are still sheathed sabers at this
point.

2. (SBU) If the testimony is as bad as has been described,
however, and if the Liberals are not successful in their
continuing campaign of damage control, it could get to the
point where the Conservatives would no longer be punished for
calling an election, and might well be dismissed as impotent
for not doing so. Timing will be everything, and the key
piece of timing will be when the testimony is revealed. This
could be as early as this week if the Brault criminal trial
is pushed back to the fall, or later in the year when the
Gomery findings are published. The sure winner in all this
is the separatist Bloc Quebecois, with the Liberals a sure
loser. What is not clear is whether the Conservatives can
get their act together to reap the spoils. End Summary

ELECTION RUMBLINGS GROW
----------------------

3. (U) For the second time in 10 days there are rumblings of
elections, with prominent Conservative MPs returning to their
ridings to take soundings from constituents and one MP saying
he was returning this week to prepare for an election. The
Conservative Party has renewed an order for ridings to secure
candidates in case Canada goes to the polls, an order that
was originally issued in December but was largely ignored
because the likelihood of an election was assumed to be so
low.

4. (U) The first talk of a snap election occurred the week of
March 28 and was triggered by the government,s handling of
the omnibus budget implementation bill, to which the Liberals
had appended changes to the Canadian Environmental Protection
Act. These changes were not included in February,s budget
documentation. The Conservatives claimed that the removal of
the word &toxic8 from the act and the inclusion of
&greenhouse gas emissions8 on the list of controlled
substances would have over-taxed Canadian industry and driven
up consumer costs. Conservatives indicated that they wanted
the bill broken up into three parts: the budget itself, the
Kyoto-related measure to amend the Environmental Protection
Act, and implementation of the Atlantic Accord on off-shore
oil revenue.

5. (U) Some observers believe that Conservative Leader Harper
was merely flexing his muscles to regain some control over
the details of the budget, after being forced to go along
with the budget vote or risk an election in February. He
threatened that the Conservatives might vote the bill down,
even if it meant a snap election. But neither Harper nor
Martin wanted an election, and both sides blinked -- Harper
by scaling back his threat and seeking a compromise, and
Martin by allowing the Environment Minister to indicate that
the environmental provisions could indeed be made into
separate legislation. By week,s end the issue was defused.

GOMERY INQUIRY TESTIMONY &EXPLOSIVE8
------------------------------------

6. (SBU) But the question of early elections came back with a
vengeance on April 4, when new revelations from the Gomery
inquiry began to leak out. Jean Brault, the former president
of the ad agency Groupaction, began his testimony on the role
his organization played in the Adscam scandal, in which
millions of dollars in government funds intended to shore up
support for federalism in Quebec were siphoned off to Liberal
supporters. Details of the scandal were seedy enough to all
Canadians, and insulting enough to Quebecers -- who saw a
federal government trying to buy their loyalty -- that the
Liberals were knocked down to minority status and almost lost
the 2004 election. But the details were always sketchy
enough to provide a measure of impunity for the Liberals, or
at least a way to avoid full and direct indictment of the
party.

7. (SBU) Brault,s testimony appears ready to change that, as
one conservative told a National Post reporter, &before we
knew money was stolen, now we know by whom.8 Because Brault
is up for criminal indictment, Justice John Gomery ordered a
publication ban. Former bureaucratic Chuck Guite and ad
executive Paul Coffin, who are also facing charges, will also
have their upcoming testimony protected. But American
conservative blogger Ed Morrisey has begun to leak
information from an inside source and the background of
Brault,s testimony is fast becoming public. Morrisey's
story provided some details of what the shady dealings were,
but left the important question of who ordered it,
unanswered. Deputy Opposition Leader Peter MacKay
characterized the testimony as &explosive,8 and said &if
the information is true, it could blow the door right off
this government.8

8. (SBU) The key question is when the testimony will be made
public. This in turn could depend on when Brault goes to
trial in the criminal case. If the case moves forward
immediately, the ban will remain in place and the information
will not be fully out until the Gomery Commission report is
released at the end of the year. But Brault,s lawyers are
seeking a delay in the trial until the fall, which would give
Judge Gomery the option to lift parts of the publication ban
as early as this week. This then would put the election
strategists in high gear.

9. (SBU) The Liberals are engaged in a high stakes game of
damage control, calling in the RCMP to assess whether fraud
has been committed against the party, and obtaining full
standing at the Gomery inquiry, with full entitlement to
cross examine witnesses. PM Martin rose in the House April 4
to defend the party against the &rumors or the actions of
the activities of a very small few who may have colluded
against the party and against the well-being of Canadians.8
In the most tense and spirited question period we have
observed, the PM also dismissed the call for a snap election
until the Gomery report is complete, &because Canadians
deserve to know the facts.8

WINNERS AND LOSERS IN A SNAP ELECTION
-------------------------------------

10. (SBU) The Conservatives until now have been extremely
cautious not to trigger an election for which they would be
punished at the polls -- there is still a sense here that the
Canadian people would prefer to avoid the cost and hassle of
a snap election. But at some point Canadians will also not
want fear of an election to allow the government to act with
impunity. If the Brault testimony is made public and is a
bad as it is characterized, it would be difficult to defend
the role of the conservatives as the Official Opposition if
they did not call for a vote of confidence (which the Bloc
could also do).

11. (SBU) If it came to an election, who would be the winners
and losers?

-- Bloc Quebecois: In the Fall, commentators said that the
Bloc had hit its high water mark by winning 54 out of
Quebec,s 75 seats. They were wrong. In a snap election the
Bloc could increase its holdings by as many as nine seats
according to commentator Andrew Cohen. Cohen is concerned by
how the Gomery scandal is empowering the Bloc Quebecois not
because overt support for separatism is growing but because
it is the only viable alternative to the failing Liberals.
In any event he believes that separatism is the de facto
winner.

-- NDP: The NDP lost a number of seats in Manitoba and BC by
less than 200 votes and could pick up a few seats in a snap
election at the expense of the Conservatives or Liberals.
The NDP exists largely in its own world, however, and will
remain fairly constant.

-- Conservatives: To win the election, the Conservatives
would have to draw away around a third of the 75 ridings that
the Liberals won in 2004 in urban Ontario. The only
ammunition they have to do so is scandal, since their social
policy agenda, though clearly defined after their March
convention, not only falls flat but alienates large swaths of
the electorate. If the Brault revelations are serious,
voters would still have to decide whether to vote
Conservative or simply stay home. It is difficult to tell
which way it would go, but a serious scandal is as good as it
gets for the Conservatives, and the young turks in the party
will likely argue that the party should take its chances.

-- Liberals: Corruption is the Liberal,s largest
vulnerability and there is no question they would lose seats
over serious, detailed, and true charges of malfeasance.
Their success would depend on how skillfully they can isolate
the damage and insulate current party leaders from
implication of direct corruption. In any snap election, the
Liberals will lose ground, the question is will they lose
their governing status?

12. (SBU) Comment: We have tried hard not to cry wolf by
suggesting that an election is just around the corner every
time the Conservatives hold a press conference. In the
current scenario there are still a number of off-ramps before
an election: Will the Brault testimony be released? Will it
be as bad has been characterized? Will the Conservatives
cost-benefit calculation lead them to a no-confidence vote?
But this is the first time there is a clear path to an
election and we should begin to take the possibility of a
spring election seriously.

Visit Canada's Classified Web Site at
http://www.state.sgov.gov/p/wha/ottawa

DICKSON

© Scoop Media