DION TO STEP DOWN AS LIBERAL LEADER -- NEXT YEAR

C O N F I D E N T I A L OTTAWA 001348 SIPDIS E.O. 12958: DECL: 10/20/2018 TAGS: PGOV CA SUBJECT: DION TO STEP DOWN AS LIBERAL LEADER -- NEXT YEAR REF: OTTAWA 1341 Classified By: PolMinCouns Scott Bellard, reason 1.4 (d) ¶1. (U) Stephane Dion announced on OCTOBER 20 that he would step down as Liberal Party leader, but only after the next leadership convention had selected a replacement; he clarified that he will not be a leadership candidate again. He will remain as Official Opposition leader in the meantime. He promised to ensure a "smooth, successful transition" and to work for the revival of the party. He accepted "my share of the responsibility" for the party's weak showing (26 pct of the popular vote) in the OCTOBER 14 election, claiming that the Liberals had failed to explain clearly that the "Green Shift" was actually a major income tax cut for most Canadians. Instead, most Canadians apparently accepted the Conservative "propaganda" that it was a carbon tax increase, he commented, while insisting that "three-fourths of Canadian voters" did not support the Conservatives. He pledged to work to build up the Liberals' "21st century fundraising" skills better to position the party to compete against the Conservatives in the next election. ¶2. (C) Comment: Dion's move effectively has ensured that the Conservatives will be able, at a minimum, easily to pass a Fall Economic Statement and the 2010 budget in the coming months. The Liberals are unlikely to pull together their leadership convention in the next several months -- much less obtain consensus on the new leader -- and so will not be in a position to vote against the Conservatives in these upcoming confidence votes. The Conservatives should additionally be able to pass most any other legislation they choose -- if they can get bills through Committee, where they inevitably have a minority of seats. With a relatively bare legislative agenda, however, prospects for much activity on Parliament Hill in the fall and winter sessions remain limited. Visit Canada,s Economy and Environment Forum at http://www.intelink.gov/communities/state/can ada BREESE