L. Ian MacDonald

July 26, 2020

In the 1988 election, the landmark one-issue campaign on free trade, the Conservative leader’s tour stopped in New Brunswick one day for a television interview.

“Harrison McCain is against this deal,” the local news anchor told the prime minister.

“Yeah, well, Jim Irving is in favour of it,” replied Brian Mulroney, father of the Canada-U.S. Free Trade Agreement that was the signature issue of the campaign.

Afterwards, Mulroney was sitting on the leader’s bus as it pulled out for the next stop. “Is that it what it comes down to in New Brunswick,” I asked. “The McCains or the Irvings?”

“Pretty much,” he replied, clearly enjoying the defining local moment of the election. And so it was, in a campaign transformed into an historic plebiscite on free trade.

Pretty much, indeed. The Irvings, with oil and shipping interests based in St. John, are the 7th wealthiest family in the country, worth $7.8 billion last year, according to Canadian Business magazine.

The McCains, who started their frozen food empire in Florenceville, N.B,. and later added Maple Leaf Foods, are ranked 16th, with family holdings valued at $4.5 billion.

Ironically, part of the McCain food fortune is the result of free trade to the U.S. from Prince Edward Island. Once Mulroney and PEI Premier Joe Ghiz persuaded Islanders to vote for the Confederation Bridge in a 1988 referendum, the McCains built a factory in 1991 at the future foot of the bridge. When the bridge opened in 1997, farmers would drive their trucks loaded with potatoes into the factory, and they would emerge as frozen French fries on their way to New Brunswick en route to Maine. PEI’s exports to the U.S. increased by 600 per cent after the bridge opened, and the McCains also made a killing from a project Harrison McCain had strenuously opposed.

Harrison and Wallace McCain were the survivors among four brothers at the time of the 1988 election, and were pre-deceased by two brothers whose offspring share a third of the family fortune.

One of the late Andrew McCain’s children was his daughter Nancy.

So, there are no benefit dinners for her as Bill Morneau’s wife. Or for him.

He started out working for his father in Toronto in the Morneau family business in financial and estate planning. He grew the business into Morneau Shepell Inc (MSI), an industry leader listed on the TSX.

Paying himself in monthly dividends from his millions of shares, Morneau drew millions of dollars from the family firm.

After the Liberals won the 2015 election, Morneau sold 1.3 million shares for about $20 million. But as David Akin of Global News reported in October 2017, Morneau while Finance minister continued to draw monthly dividends of $65,000 on his remaining MSI portfolio; $780,000 a year or about $1.6 million during the Liberals’ first two years in office. How many shares did he still have? “About a million,” Morneau said. Morneau then sold his remaining MSI shares, donating the profit to charity, and put the rest of his investments in a blind trust.

But the fact remained that while holding office for two years, Morneau held a proprietary interest in a company whose activities were subject to scrutiny by the department of Finance.

Nathan Cullen, then NDP Finance critic, said at the time “we may be looking at the most blatant conflict of interest in Canadian history.” While hardly understating the matter, Cullen was not wrong on the essence of it.

In the midst of all this in the fall of 2017, the CBC’s Elizabeth Thompson broke the story of the villa in the south of France, the one Morneau forgot about. CBC reported that Morneau, through a holding company, shared ownership with Nancy McCain Morneau in a vacation home in the Provence region of France. The Finance department clarified that the ownership had been disclosed to the Conflict of Interest Commissioner, but not the name of the holding company, causing “early administrative confusion.”

There’s a pattern here, one of forgetfulness but also entitlement, that was apparent in Morneau’s disclosure to the House Finance Committee last week that he wrote a cheque for $41,000 to the WE Charity to reimburse them for accommodations during two family outings to Kenya and Ecuador in 2017. He wrote the cheque on the very morning of his testimony, after ascertaining he paid for his family’s travel but not lodging on the two field trips to WE youth camps abroad.

Once again, he just forgot. It’s one of those things that keeps happening to Morneau. Nobody questions his motives—there isn’t a nicer person on Parliament Hill. His family’s sense of public spiritedness is also above reproach, including the involvement of their two daughters with WE, one as a volunteer and the other now as a contract employee. All the Morneaus deserve plaudits for their devotion to the laudable cause of education for international youth.

But he keeps forgetting to disclose inherent conflicts of interest to officials with ethical or regulatory oversight.

And that’s the born sense of entitlement which assumes no one would question his integrity because, well, he’s Bill Morneau and he’s above that sort of thing. Which again, misses the whole point, and is the main reason Morneau and the Liberals are in so much trouble over this WE thing.

And now they are looking ahead to a week of hearings by the Finance Committee where events may quickly shift from rolling out to unravelling, which is to say completely beyond the Liberals’ control.

First there’s the scheduled appearance of Marc and Craig Kielburger, the founding brothers and co-CEOs of the WE Charity and its affiliated brands. The Kielburger brothers may well begin the narrative of how they set out to save the world’s children over two decades ago, a worthy cause celebrated in WE Days and recognized in their both having been awarded the Order of Canada while still in their 20s.

The opposition parties will be more concerned to learn of the brothers’ role behind the searing headlines of Justin Trudeau’s closest family—his mother, his brother and his wife, all being on the WE payroll at one time or another.

While Sophie Grégoire Trudeau was paid only $1,400 for a single speaking engagement in 2012, she remained a goodwill ambassador for WE, appearing as recently as March with Margaret Trudeau at a WE event in London, where she became infected with the coronavirus. Presumably, Sophie’s travel and any other legitimate costs were covered by WE as the sponsors. What resonates with the public is the $250,000 paid to Trudeau’s mother for 25 speeches from 2016-20, and $32,000 paid to his brother Sasha for eight speeches in 2017-18, with another 20 percent for their speakers’ bureau fees. When Justin Trudeau appears before the committee, presumably later in the week, he will have to explain himself all over again regarding his obvious conflict of interest and non-recusal from Cabinet discussions awarding WE a management contract of up to $43 million on a $900 million summer youth job program, both awarded without tender.

And then, again for the Kielburger brothers, what is the role of the WE real estate wing entity in downtown Toronto properties worth a reported $50 million? If there’s one thing people understand about Toronto, it’s the potential value of downtown land assemblies, even on decrepit properties, for real estate development.

And then there’s the tick-tock of the pandemic program, and how WE had the inside track. One important witness before the Finance Committee was Rachel Wernick, the senior assistant deputy minister in the line department of Employment and Social Development. She told the committee she reached out to Craig Kielburger on April 19, three days before the program was announced. By the close of business on April 22, WE was ready to submit an untendered management proposal. The sister of Michael Wernick, former Clerk of the Privy Council, Rachel Wernick left an impression of a dignified and self-assured mandarin who wouldn’t be taking the fall for anyone.

Nor would her minister, Bardish Chagger, who had the role of revealing the management contract was worth up to twice what had been previously revealed. While she was the junior minister of the Cabinet group, she successfully conveyed the impression that her own actions were above reproach. Which puts this whole thing in the lap of Trudeau, who has exceptionally volunteered to appear later in the week, following his chief of staff Katie Telford. One does not get the sense that her role in the PM’s office is to tell Trudeau when he’s wrong, she is perceived as a facilitator of PMO agendas.

When he does appear, he will have the Kielburgers, Morneau, his family, and himself to answer for, all with the ethics and conflict of interest commissioners keeping a very close eye on him. It’s left to Trudeau to answer how the management contract was awarded one week in June, and subsequently cancelled within two weeks.

There is an old saying in Quebec: quand ça va mal, ça va mal. Trudeau is there now. Not without his own sense of entitlement, to the manner born. It’s on him, now.

L. Ian MacDonald is Editor and Publisher of Policy Magazine.