Why Premier Gordon Campbell's HST spin campaign is doomed

Effective public-relations campaigns often rely on third-party endorsers.

In these instances, a person or an organization with little credibility doesn't deliver the message.

Instead, someone who is more trusted is recruited as the pitchman or pitchwoman.

There are lots of examples. Pharmaceutical companies find patient-advocacy groups to push PharmaCare to cover the cost of new prescription drugs. These same patient-advocacy groups lobby the media to cover their efforts.

Forest companies have funded campaigns that rely on ordinary citizens to argue in favour of logging. Corporate spin doctors know that the average Joe is more trusted than a guy in a pinstriped suit who makes $2 million per year.

In the 1960s, General Electric recruited Ronald Reagan to soothe the public.

Like the pharmaceutical giants, forest companies, and General Electric, Premier Gordon Campbell finds himself in a similar predicament. His problem is the harmonized sales tax, which he never mentioned in the campaign leading up to the May 12, 2009 provincial election.

This is despite a recommendation in December 2008 from his own advisory body, the B.C. Progress Board, to harmonize the GST with the provincial sales tax.

The HST is a $1.9-billion annual tax shift from business to individuals. That benefits the corporate sector, which donated generously to the B.C. Liberals before the 2009 election.

The premier and the finance minister, Colin Hansen, have maintained that they didn't consider introducing the HST until after the election. They said they had to act because Ontario was planning to introduce the HST.

This claim sounds ridiculous to many people for two reasons. Ontario's HST was included in the McGuinty government's March 26, 2009 budget after some consultation. Secondly, prairie provinces and Quebec don't have an HST.

Hence, there's a lack of trust with whatever Campbell and Hansen might say on the topic.

This morning, the Vancouver Sun published an opinion piece about the HST from a former B.C. Liberal attorney general, Geoff Plant. Plant is a former roommate of the premier's while they were both on the opposition side of the legislature in Victoria.

In the coming weeks, I expect we'll see more opinion pieces in the Vancouver Sun and other newspapers from friends and supporters of the premier.

These third-party endorsers will try to create a chorus of support for the HST. They will argue that harmonization will stimulate the economy. They'll claim that Bill Vander Zalm's initiative can't defeat the tax because it's a creation of federal law. And they'll point to value-added taxes in other parts of the world to make it appear as though B.C. is merely falling in line with economic common sense.

In the end, I'm betting that they'll fail to win over the public. That's because none of these arguments will address the central issue stoking the outrage: that Campbell and Hansen didn't tell voters of the tax during the election campaign.

There's a belief in some quarters that the B.C. Liberals had a secret agenda. So far, the skeptics haven't heard a convincing argument that the premier and Hansen were not planning the HST before the election.

The impossibility of third-party endorsers to address this concern will ensure there will be vigorous recall campaigns. They might finish off the careers of some B.C. Liberal MLAs.

Anti-HST sentiments, driven by a perceived lack of transparency during the 2009 election campaign, will probably also force the premier to retire before the next election.

That's if he manages to survive a recall campaign in his constituency of Vancouver-Point Grey.

In this regard, Campbell will resemble Brian Mulroney, who resigned as prime minister on June 25, 1993 to avoid overwhelming humiliation at the hands of voters later that year.

The premier is looking like a lame duck. Maybe it's time for political cartoonists across the country to start drawing him this way.

Follow Charlie Smith on Twitter at twitter.com/csmithstraight.

Comments (27) Add New Comment
doofus
Gordo's pitchman is also secret agent man
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Morty
Personally, I'm more concerned about Vander Zalm's secret agenda. We've been down that road before.
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PoliticsReSpun.org
I'm more inclined to think that Campbell will be the front man, selling the BS, then taking one for the team before bowing out.

http://politicsrespun.org/2010/06/gordon-campbell-hst-samurai-fall-guy/
stephen elliott-buckley
http://PoliticsReSpun.org
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Bruce McAra
The other reason it will fail is because we have heard it all before. Plant offered a different take but his technical legal arguments do not out weigh the overwhelming public response. Certainly the province has no legislative way to repeal the HST but it can ask Ottawa to do so. Even Plant knows that.
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Camero409
I hope I am one of the people that work on either Gordo's or Hansen's recall. I despise the LIbERalS and want them out of government and on the trash heap forever. These guy's and I include Harhar in Ottawa are narcissistic egomaniacs who are basically drones for the elites. They have no interest in telling the truth (See BC rail scandal, underfunding of education, underfunding of the medical plan, the selling off of BC hydro et el.) and haven't told the truth since day one after being elected in 2001. The right wing are corrupt and only seek ways to transfer more of the white and blue collar and the poor hard earned money into their coffers. Once Gordo and the rest are finished they will get their just desserts with a board of directors appointment once their political career is over (See Carol Taylor).
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Gordonitsdone
BC has already turned a corner. Its of Gordon. If you are a Liberal MLA and want to keep your career in politics I would jump ship and be part of this movement. Don't resist.

We (the people) win.
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Skeena Fisherman
I guess if Campbell can smile when is charged with a DUI he can smile when he tells us he didn't plan to introduce the HST but made that decision after the election.
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cynical
The neocons are momentarily doomed because the party is over. Everyone is aware of corruption while it is going on (he was arrested for drunk driving!! the police stormed the legislature!!) but just so long as it serves their agenda i.e. the appearance of cashing in - MOST DON'T CARE.

Now that the tides are turning and the ponzi scheme is coming to an end suddenly people are critical of this government.

At the end of the day we need to wake up and think longer term. Through our greed we have dismantled our public rivers, hydro, health, education, unions, pensions,... and it is going to be a fight to get it back.
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Ray I
Funny how short a memory people have. The Zalm is now popular and Campbell is the enemy. This is another great example of why no politician's career will ever be over in BC. Wait another decade and there will be a Draft Campbell movement afoot. Drink the Koolaid you dumbasses!
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Island Man
Campbell's stubborn refusal to back off and accept the will of the people states volumes for his contempt of the voters...he actually believes he can spin another yarn and change all our minds. It shows how out of touch he reallly is.
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Art
Gee Charlie a bit of "yellow journalism" here. Going to put photo's of the grave of the person who died in the accident by Constance Barnes or photo's of the house she crashed in to when she was impaired on teh nest story about her or are left wingers immune from your style of journalism.

Now lets give the people the facts. If everybody plays the game by the rules there is NOT a 1.9 billion dollar tax shift from corporate to consumer.

You know that! Example on furniture I pay 5% GST and 7% HST for 12% total. when HST comes in it will still be 12% BUT THE PRICES SHOULD GO DOWN. Why? because all the PST paid by manufacturers, distrbutors, and retailers are now input tax credits which reduces their costs.. Of course don't count on it because if you notice Mr. VanderZam and his developer friends don't mention this.

So Charlie how about some factual reporting. Yep some ugly things about HST but get off of the poltical bandwagon and use your journalistic reach and skills to tell us the good , bad and the ugly. Leave the biased remarks to the comments postings which I am sure spill forth with this. I will enjoy them but also saddened by how many really haven't tahen the time to find out all about this tax before fighting it or supporting it.
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Mark Edwards
The whole government system needs to be torn down and built back up with hard working people not a bunch of imoral morrons .For sure campbell has another trick up his sleeve there is way to much money involved.What an ass to go down in flames like this.What a bunch of fools you liberal voters were to put them here in the first place....Shame on all liberal supporters Shame....
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Caz
Its about time, we as BC'ers hold our MLA's accountable. Sometimes we let them get away with too much too long.

We let the NDP know last time their errors were unacceptable, now its time to let Campbell and the Liberals know.

I hope the NDP has learned their lesson, or a third party comes up with more honesty and transparency. One that balances the wants of businesses and the needs of society.
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Morty
What the hell?! People don't think Vander Zalm has an agenda? This is a guy who, as premier, tried to cut funding for abortions; appointed a close friend to a position tantamount to cabinet; and ultimately had to resign abusing his position to help further his personal business. If you don't believe me, look it up yourself.

Everyone complains about Gordo's Liberals being right-wing liars, but Vander Zalm's worse on both counts. He's nothing but a snake-oil salesman who would fit better into the old Reform Party than into any part of modern BC politics.
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glen p robbins
It's kind of comedic how the mainstream analysis -- kind of makes it like its possible dead duck Campbell could actually stay on -- "maybe we'll have a BC Liberal and BC NDP leadership race."

Right at this moment --- I would take the bet that the BC New Democrats will end up with sixty seats -- before I would wager anything on the remaining days Campbell as premier (keeping much powder dry).
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stanmortensen
In response to an earlier message not seeing the difference now and later, don't forget there is a whole host of items that previously were only subject GST and now will be taxed under HST.
Items such a labour on car repairs, lawyers fees, accounting fees, labour costs on appliance repairs or the guy that cuts your lawn, realtor fees. The costs are not going to come down on these items.

Not mentioned by anyone has been the other shoe, these so-called ITCs' will now become taxable income for companies, small and large, where the PST was an expense before. The Feds will reap a windfall far in excess of the 1.6 billion they bribed Hanson etal with.

HST is bad for both small businesses like mine and bad for consumers struggling to get out this recession. Heck, we now have a recession that will be made in BC
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Andrew
Gordon Campbell along with Peter Mansbridge are now at the Bilderberg 2010 conference in Sitges Spain (June 3-6). He's going to do a lot more than spin the HST; what is he doing conspiring with the global elite behind closed doors? If you think the HST is bad, you ain't seen nothing yet!
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Lynn
Well I just read that he's attended the meeting in Spain the the elite THE BILDERBERG GROUP this week so with them behind him, I would say we will be taxed more and more to come.Have a look at who's all attending from Canada on this link.
http://www.prisonplanet.com/bilderberg-2010-final-list-of-participants.html
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ART
Stan Mortensen
ITC's are not taxable; they offset what you collect. However they reduce your costs by eliminating PST and if you don't reduce your selling price to the consumer and keep the cost savings as profit; yep you will pay more tax as you are making more money.

As for sevice industries etc. yes HST will add on to them but not the full 7% as they also will have ITC credits for previously PST taxable supplies etc. which now they too can pass on cost savings (albeit minor) to the consumer if they so choose but no way will it offest the tax increase for these services.

The best estimates given so far are 1/2 point and 7/10th of a point increase to the CPI. I believe it will be higher because I cannot see most business having the sophistication or will to pass on these savings.
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stanmortensen
Art;
Respectfully, you are assuming the savings are going to passed on to the consumer. Not gonna happen.

With regards to ITCs', yes you are right they are not income taxable as such but they represent potential increased income to a company's bottom line where currently the PST represents a business expense that is written off against earned income thereby reducing taxable income. Let's be very clear here, the Feds would not have proffered this deal unless there were real tangible benefits for them. With the initial 5 year lock-in they expect to be able to recoup the $1.6 billion bribe well within that time frame.

While there may be a slight reduction in pricing on retail goods, and I note it would be very slight you are not going to see restaurants reducing their prices, nor are you going to see reductions in the base costs on the services side. The accountant that is currently charging 1200 plus GST will now charge 1200 plus HST and if you don't like it well that's tough try and find someone else. The same will be true for just about everyone else in the services fields. While it is true that as a business I will be able to claim the ITC the fact is it is still an upfront outlay that previously was not there.

Interestingly, I can now as of July 1st do some of the financial services business with a firm in Alberta and not have to worry about the HST which I suspect many small businesses may want to consider.

There is an assumption by conservative minded folks that businesses will operate in an altruistic manner and pass savings along. That is just not going to happen.

Finally, you have to ask yourself where is the additional $2 billion dollars going to come from? Likely, the first casualty will be the restaurant trade as folks reduce their overall spending. Then you can expect that charities and churches will feel the impact with reduced donations. These are the two areas where people can offset the expense.

The next impact area will be on incomes, you can now expect this impact to be felt in labour negotiations in union situations and I certainly expect the currently well overpaid public service areas to be leading that pack followed up by the longshoremen. So, at the end of the day, those who have the ability to apply pressure for increased income will do so while those in unprotected jobs will see the gulf widening further.

We needed to have a full and upfront debate about the impact of HST right at the beginning. As with everything this government has done, this has been rushed into without any real discussion or even thought about how it will affect the everyday lives of British Columbians.

Will HST make lives better for everyone? No, it will further widen the divide between those who have the resources and those who do not have the resources to pay. When a major taxation change such as this is made you need to consider the overall ability of the taxpayer to pay and the overall tax load (including fees, municipal taxes and levies from all sources) you have placed on the taxpayer.

There is a tipping point in overall taxation and I suspect we are there now or will be on July 1st. You cannot look at one area without considering how it will affect all other areas.

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