Trudeau Rival O’Toole Attacks Him on Investment Climate, Backs Deficits

The Conservative leader seeking to unseat Justin Trudeau is hoping a pragmatic economic policy and lawyer’s sensibility will be enough to eclipse the Canadian prime minister’s star power.

In an interview this week, Erin O’Toole sketched out how he thinks his team can overcome daunting odds of defeating Trudeau’s governing Liberals in an election campaign that could begin this summer. His plan includes a platform that tries to shun some of the ideological baggage often associated with his party.

Trudeau Rival O’Toole Attacks Him on Investment Climate, Backs Deficits

On competitiveness and growth, O’Toole sticks closely to the traditional Conservative script. He’s critical of Trudeau’s economic record and said his party will use the tax system to get companies to invest, while removing regulatory constraints to capital spending. He’s also a champion of Canada’s oil and gas sector, a necessary position in a party with a strong base in resource-rich western provinces.

But in other areas, O’Toole has veered away from some of the economic orthodoxy associated most recently with Stephen Harper, who was Conservative prime minister when O’Toole first ran for office in 2012.

He’s in no rush to balance the budget. He seems to be comfortable with having the state steer and promote production capacity in certain industries, like health care or arms production. And he has reached out to organized labor perhaps more than any Conservative leader in a generation.

He characterizes his economic thinking as the “Conservative Party facing the world and the country in 2021.”

“We are still very much a free market non-interventionist party, provided that the national interest doesn’t require some strategic element,” O’Toole said in the interview, conducted via video conference.

Political Language

Although his policy playbook is still short on details, he boasts of his efforts to consult widely and sticks to the cautious political language of someone who spent a decade as corporate lawyer.

His two immediate predecessors -- Harper, who spent a decade as prime minister, and Andrew Scheer -- went down to defeat to Trudeau’s Liberals, often dubbed the country’s natural governing party because of its electoral success. Trudeau’s father, Pierre, was prime minister for 15 years.

Recent polls have O’Toole and his party running behind again, and Trudeau’s position has strengthened as Covid-19 vaccines have rolled out.

While O’Toole also comes from a political family -- his father was a member of Ontario’s provincial legislature -- he prefers to point out that his dad also worked at General Motors Co. To contrast against Trudeau’s celebrity, the Conservative leader is constructing a campaign narrative around his middle-class roots and military career before he went into law.

Trudeau Rival O’Toole Attacks Him on Investment Climate, Backs Deficits

“I’m competing with a prime minister whose birth was covered in Maclean’s magazine,” O’Toole said, referring to Trudeau’s birth on Christmas Day 1971 during the first of his late father’s four terms. “Mine certainly wasn’t, so I’m playing catch-up.”

Like past leaders of his party, O’Toole’s main challenge will be to keep intact his party’s factions -- from religious social conservatives to business-friendly Tories -- while also appealing to swing voters in the suburbs of Canada’s largest cities, which are must-win.

He’ll need to do all this while fending off efforts by Trudeau to paint the Conservatives a party as rife with intolerance and bigotry, filled with people who want to roll back women’s rights, gay rights and social programs.

‘De-ghettoize His Party’

The latest case is debate over whether to criminalize therapy that attempts to change an individual’s sexual preference. Last week, 62 Conservatives voted against a bill that would criminalize conversion therapy, and the Liberals have been harping about it ever since.

O’Toole, along with 50 other Conservatives, voted with the government to criminalize the practice.

“O’Toole is trying to de-ghettoize his party” from its “outsider” mindset, said Yaroslav Baran, a managing principal at Earnscliffe Strategy Group in Ottawa and a former communications adviser to Harper. “What he represents is a non-ideological alternative to the governing Liberals.”

Based on his comments, O’Toole has identified sluggish business investment as a potential area of attack. Capital had been leaving the economy even before Covid-19 hit, with the investment climate continuing to be weak, the leader said, pointing to reports that Warren Buffett’s Berkshire Hathaway Inc. pulled out of a gas export project in Quebec.

“That’s a real signal that Canada’s a place where things can’t get built and things can’t get done,” O’Toole said.

Balancing the budget won’t be a priority, said O’Toole, who is giving himself a decade to eliminate the deficit. That’s probably more slowly than what the Liberals are planning, based on their fiscal projections.

Perhaps the sharpest turnaround from past policy was his decision to back a price on greenhouse gas emissions -- a major departure for a party that had opposed the idea for two decades.

O’Toole’s position on foreign policy and trade is more Conservative mainstream. He wants open trade and deep ties with traditional allies and democracies, while seeing China as an economic rival that can’t be trusted.

“We’ve been falling out of step with our allies,” O’Toole said.

©2021 Bloomberg L.P.

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