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Canada - Stronger Today Than It Was Yesterday

May 03, 2011 11:27 AM ET
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Seeking Alpha Analyst Since 2008

Ian R. Campbell is a recognized Canadian business valuation authority, having authored books used by lawyers, experts and Canadian Courts in business valuation litigation matters. In 1976 he founded Campbell Valuation Partners Limited (Toronto), one of Canada's preeminent valuation consultancies. He is a Fellow of both the Ontario Institute of Chartered Accountants and The Canadian Institute of Chartered Business Valuators. The latter Institute annually awards a Research Grant in his name. Mr. Campbell has provided testimony on business valuation before most Canadian Courts, and for forty years has advised many of Canada's wealthiest families on business valuation related matters.

Last evening my wife and I watched the Canadian Federal Election returns.  We have done that same thing in Canada’s previous Federal Elections for as long as I can remember.


At the onset of the television coverage, which began at 9:30 p.m. ET to accommodate the 3 hour time difference between our provinces of Ontario/Quebec and British Columbia, I said to my wife that I believed it important that the Conservative Party headed by incumbent Prime Minister Stephen Harper gain a majority in the Canadian House of Commons. I like to consider myself largely apolitical, but do lean to the right.  I voted for the Conservative candidate in my riding yesterday.  My wife leans at a fairly steep angle toward the Liberals, and actually might have voted yesterday for the NDP candidate – I haven’t asked her who she voted for, and don’t want to know.


When I made the declaration I did about what I saw as the importance of a Conservative majority, my wife asked me why I was taking that position.  An easy question for me to answer.  From my perspective, I believe a majority government in any democratic country with a Parliamentary system is critically important in today’s country-specific and world economic environment.  For me, too much time and energy is lost in minority Federal Government posturing and bickering at a time when a number of hard decisions are likely to have to be made in an incisive manner – and will be more easily made with a majority government in place.  For some time now, I have been of the view that a Parliamentary political system is a better democratic form of government than is the American ‘Federal Republic’ system.  In my view, one only has to look at today’s ‘polarized Washington’ to understand my point.  The current U.S. Federal Government Congressmen and Senators in my view simply don’t have the ‘luxury of time’ they seem to think they have to endlessly debate their U.S. cumulative debt problems, and ongoing budget deficits.  But that interminable debate process is what almost certainly will happen, and America will be the worse for it.


In Canada our Federal House of Commons has 308 sitting members.  Last night I got my wish.  Mr. Harper’s Conservative Party won 166 seats in circumstances where 155 seats would have constituted a majority.  Perhaps importantly the Bloc Quebecois party, which advocates Province of Quebec Sovereignty, was decimated in yesterday’s election, retaining only 4 seats.  That party’s leader, Gilles Duceppe, lost his own seat, and has now resigned as party leader.  As a practical matter, I think this means that any continued push for Quebec Sovereignty, at least in the current and prospective economic environment, has been dealt a harsh blow.


Canada now has a stable majority government for at least 5 years (in Canada a majority government must call an election within 5 years of taking office) – which 5 year period I believe will be critical to Canada’s continued well-being.  It now remains to be seen whether the Conservatives will act in an even-handed way over the next five years.  My bet is that they will, and believe Canada is an even ‘better place to be’ on Tuesday, May 3 than it was on Monday, May 2.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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