Politics and Business: House of David

David Emerson said he wanted to inject some business savvy into Ottawa at a time when "the [partisan] lines are blurring." He ended up crossing those lines. The House of David took a beating for the blunder. Is this a lesson for other business high flyers tempted to flex some political muscle?

David Emerson said he wanted to inject some business savvy into Ottawa at a time when “the [partisan] lines are blurring.” He ended up crossing those lines. The House of David took a beating for the blunder. Is this a lesson for other business high flyers tempted to flex some political muscle?

If B.C.’s brightest business light can’t do it, who can? For David Emerson, corporate warfare and boardroom battles have probably never looked so good. If this man can’t make the move from corporate life to politics without getting chewed up and spat out, what’s the message to the rest of the business world? Emerson’s corporate credentials are impeccable: He turned around the Western Bank of Canada and steered Canfor through the toughest of times. He’s on anyone’s top 10 list of B.C. business leaders. And he knows politics: Deputy finance minister in Bill Bennett’s government, deputy minister to Bill Vander Zalm through the Fantasy Gardens fiasco—one of the weirder periods in B.C. politics, known for being weird at the best of times. And then kept on by the NDP.

But now everything’s gone oh-so-wrong. It’s a scary tale for any corporate high-flyer thinking that running for office, despite the risks and sacrifices, might just be the most important thing you could do for your country. Because if David Emerson can’t do it, who can? It started out okay. Handed the Vancouver Kingsway nomination on a platter by Paul Martin, an easy 2004 election win and good marks as industry minister and advocate for B.C. garnered him praise all round.

Then came this year’s election: Emerson wins, the Liberals don’t. And after a call from Stephen Harper, some agonizing and some counsel, Emerson decides to shed the sackcloth and ashes uniform of the battered Liberal opposition and slip into something a little more comfortable—a seat in Harper’s cabinet.

B.C.’s bright light went to the dark side; suddenly he’s just another politician. It made perfect sense—to Emerson, that is. You can only get things done as a cabinet minister, he says. And Emerson saw things that he wanted done, such as reaching a softwood deal and opening the Pacific Gateway. He consulted with some trusted friends and advisors, people like Gordon Campbell. He expected some backlash. But not a public flogging. Pickets, vilification, anti-Emerson signs on lawns across the riding. Abuse for his children. Nasty comments even from allies: a Province editorial was headlined “The David Emerson switch makes sense despite the stench— hardly unqualified support.

Instead of being celebrated as B.C.’s champion in the new government, Emerson was roundly slagged as a symbol of politics gone wrong. He went into virtual hiding, ducking reporters and constituents, cancelling scheduled press conferences, a strategy dictated by the prime minister’s office. He was shattered enough that despite repeated requests over weeks and a general disposition to talk to BCBusiness at most times, he refused to be interviewed for this article.

The man who once so visibly represented B.C. business interests is suddenly lurking in the shadows. He’ll stick it out, hunkering down and hanging onto his cabinet seat. There’s work to do, and Emerson is still convinced he’s right about the switch and the thousands of critics are wrong. He said as much in his February “apology” to his constituents: “To those of you who are upset with my decision—I apologize. However, I did not come by this decision lightly and I stand firm behind the decision to become a part of this new government.” (Emerson was granted some breathing room in late March when ethics commissioner Bernard Shapiro concluded that Emerson’s defection did not breach any parliamentary rules.) But the B.C. star is badly tarnished.

If David Emerson makes the leap from business to politics and ends up hanging onto the ledge by his bloodied fingerprints, why would anybody else high up in the corporate world even try?

And then there’s the real—and, for society in general, very important—question. If David Emerson makes the leap from business to politics and ends up hanging onto the ledge by his bloodied fingertips, why would anybody else high up in the corporate world even try? Will the political ranks in future be filled with nothing but policy wonks, backroom schemers and political lifers? That’s a real problem for government, and political life in Canada. A lot of these people are smart. More importantly, they bring a set of rare personal qualities and a distinctive perspective—insights gained by experience that few have had.

The best decisions, says James Surowiecki in The Wisdom of Crowds, come from a group that is diverse in background and knowledge. If no one from big business is there, the chances of finding the best solutions to the country’s problems are seriously reduced. But business people aren’t taking on the challenge. Ask for examples of successful transitions from corporate life to politics, and analysts start talking vaguely about the days of C.D. Howe two generations ago. “Government suffers,” says Glen Clark bluntly, who made the jump the other way, from politics to business. “The government could do with more diversity in the people who are elected,” he adds. Still, he insists business is still heard loud and clear when it’s time to set policies. “They get their views represented in a big way. They’re articulate and they’re powerful.”

But what’s lost at the cabinet table are people who have seen the challenges for large business up close, and developed a whole different of set of skills and solutions to problems. It’s easy to come up with reasons people shouldn’t make the switch. Start with the money. For all the grousing about politicians’ pay—or because of it—anybody from the upper ranks of the corporate world who moves to politics is likely looking at a big pay cut. Emerson was paid $1.2 million in his pre-retirement year at Canfor. He’ll make $215,000 as a federal cabinet minister. (And would take another $69,000 cut if he ended up in the B.C. premier’s chair. These days, a hard-working welder can pull in more than Gordon Campbell.)

It’s still a lot of money. But an 80-percent pay cut creates problems, no matter how high the starting point. Figure two or three mortgages, kids at expensive universities and the costs of keeping a high-end life going and you can see that an MP’s pay doesn’t cover the nut.

B.C. finance minister Carole Taylor says there’s no avoiding the reality that politics pays a lot less than business. But it’s not just the lost income. In Canada, at least, a stint in politics isn’t considered a smart career move. There’s no added value, corporate boards judge, in having an executive who really knows how politics work. “You’re certainly stepping off the success rung in business,” says Taylor, who has sat on some of Canada’s blue-chip boards—including Canfor.

Given the pace of change, four years out of the business world can leave even a well-connected exec feeling out of the game.

And potential politicians would be looking at some big hits to what is probably a fairly pleasant personal life. David Mulroney is a veteran Victoria Liberal who has helped recruit candidates and run twice himself, losing to a New Democrat in this year’s vote. He’s not sure about another run. Even forgetting the income drop (Mulroney’s a successful trial lawyer), the idea of a regular commute to Ottawa—and weeks away from family—was a tough sell, he says. “For me the reality was staying in some basement suite with some other MP,” he says. “It can be very difficult to have the same quality of life you had as a private person.”

None of that daunted Emerson. He’s 60 and has racked up a string of successes—and some big stock option gains. But he ran straight into the two main reasons business people are saying no thanks to a mid-career detour into politics: the public’s watchful eye—and the derision. “Mostly it’s the abuse,” says Taylor. When successful business people talk to her about politics—she’s encouraged many to run—they keep coming back to the public scrutiny of every aspect of their lives, and the abuse that can come with any perceived misstep.

It’s a fate not just reserved for politicians like Emerson, those who stumble badly, or bring disaster down on their own heads. Taylor has been on an extended honeymoon with the B.C. media, in part because she’s skilled at dealing with the press, and in part because she’s worked hard at getting on top of her job. But something as simple as the traditional pre-budget photo op—where finance ministers show off their budget shoes —got her into trouble. Taylor picked out a pair of Gucci pumps at Holt’s (hideous, a TV reporter told me, but what do political journalists know about fashion?). It took about 60 minutes for the press to find out they cost $600. By the next day, the shoes were the biggest part of the budget story. Taylor handled it deftly, playing up her clothes as ‘infrastructure investments’ and noting that she’d bought her budget-day blouse 20 years ago. But she was steamed.

It shows how tough the switch can be. Taylor has been a journalist and should have seen it all coming. But it’s easy to forget that running for office means everybody has an opinion about everything you do—right down to your choice of footwear. Taylor says it’s time to cut back on the abuse. Forget corporate types—why would anyone set themselves up for highly public, often vicious personal criticism over everything from their compassion to their wardrobe?

Glen Clark sure agrees. He lived under the harshest of spotlights as B.C.’s premier and resigned while under criminal investigation in a bizarre case involving casino licenses and home renovations. Clark was cleared of any criminal wrongdoing but was found to have broken conflict guidelines. Now he runs several businesses for Jim Pattison including, ironically, 24 Hours, a free daily newspaper. Those contemplating an entry into politics often ask him about the experience, says Clark, who has thrived in the business world. For business people, three deal-breakers usually come up, he says. The money, obviously. But even more so, the loss of privacy—”living in a fishbowl” —and the public criticism. “I really do think it’s the media scrutiny,” Clark says. “I had reporters going through my garbage.”

Clark, first elected when he was 28, says he had forgotten how pleasant it is to live without feeling that people are watching and waiting for something to criticize. Everything from the restaurants a politician chooses to the schools she picks for her children  becomes fair game. And it’s not just the media attention. Brian Mulroney recalls introducing himself to a well-dressed middle-aged woman as he campaigned on the streets of Sidney. She gave him the finger. “You run for political office, and some people will treat you like dirt,” he says.

But wait a minute here. Politicians better look in the mirror before they get too wound up about the abuse. After he switched parties, Emerson waxed philosophical about the death of partisan politics. “I think the lines are blurring,” he said. “We’re into a global moment, economically, socially, environmentally.” All very well, except that days before the election he told the Vancouver Sun editorial board a Conservative government would wreck Canada. “We’re going to go off down some black hole,” he said. “We’re going to be more socially conservative, less tolerant, a less generous society.” In other speeches, and in the House, he called Conservatives angry and heartless, uncomfortable with immigrants, opportunistic, dishonest. No wonder he looked like an opportunist who put power above principle.

Still, Taylor says everyone needs to calm down—including the players. “All of us—media as well as politicians and the community—have to be a little more careful about how abusive we are to our politicians,” she says. And finally, there’s the work itself.

Clark, like Gordon Campbell , was known for putting in long, long hours, and certainly Jim Pattison demands commitment from his executives. But business people, especially those who have seen the lives of politicians up close, are wary of the demands, Clark says. “You’re not quite in control of your own agenda. The pace is intense and busy, but you’re not in charge,” he explains. You can be solving constituents’ welfare problems in the morning, lunching with Thailand’s foreign minister, directing critical public policy in the afternoon and schmoozing at a community centre fundraiser in the evening. Lots of business people like the idea of developing policy and running a ministry, Clark says, but they don’t want to kiss babies, clear up constituents’ beefs with government departments or spend yet another evening at some political event.

But there’s a bigger problem than the pace. There’s the feeling of being benched. Pierre Trudeau got in trouble for his famous dismissal of MPs. “When they get home, when they are 50 yards from Parliament Hill, they are no longer honourable members—they are just nobodies,” he said.

Days before the election, Emerson told the Vancouver Sun a conservative government would wreck Canada. In the House, he called them angry and heartless, uncomfortable with immigrants, opportunistic, dishonest. No wonder he looked like an opportunist who put power above principle

Emerson said the same thing, more emphatically, with his decision to switch parties. “In my limited time in public life, I want to get as much done as possible,” he said. And sitting on the backbench, on either side of the House, wasn’t in his plans.

Emerson has been blasted for arrogance. But it’s the unspoken worry of lots of potential candidates from the business world. A CEO, or someone running a division or department, can get things done. There are always masters—a board, or another level in the corporatio—but there’s a clear relationship and chance to make things happen.

It’s different in politics, even for cabinet ministers. “There’s only one CEO in government, and that’s the premier or prime minister,” notes Norman Ruff, the UVic prof emeritus and dean of B.C. political observers. Cabinet ministers have vastly diluted powers compared with their corporate counterparts. And as for backbenchers, well, in terms of major government decisions, Trudeau was mostly right.

Clark says things are different for him now, at least in his corner of the private sector. “You have to make decisions quicker, and there’s an immediate response in how the company performs,” he says. Government isn’t like that. Consultation is constant: with other ministries, stakeholders, the public, unions. The PMO’s flock of appointed advisors are on 24-hour watch for any bad political consequences and can kill a minister’s plans with a single phone call. Other cabinet ministers are wondering if your project will hurt their ability to get money. The Treasury Board can say yes or no.

Even if you get a decision, there’s a vast bureaucracy that has to make things happen. And almost no one outside a cabinet minister’s personal staff really works for him. Even the deputy minister, the department’s COO, reports to the prime minister’s deputy, not the politician.

Clark says he learned, sometimes painfully, that turning a decision into action was a whole other challenge. “I underestimated how difficult it is to get things done in government.” Despite all that, he still encourages people to run for office. “It’s a noble calling,” he says. Taylor says she’s been encouraged by how much you can get done (though that’s a little easier when you step straight into the finance minister’s job as a star candidate). You need to keep things in perspective, she says. “If I can make one person’s life a little bit better in the day, that’s a good thing.”

A good thing, sure. But not likely enough to persuade a whole lot of corporate and business types to step off the career ladder, take a big pay cut and open themselves up to public abuse. David Emerson should have been the trailblazer, the one who showed people in the business world that they could make a difference in government. He is stubborn, after all. In March 2005, as minister of industry in Paul Martin’s cabinet, he told BCB: “My objective has been to get to the point in life where I can tell anybody to stuff it.” Instead, he got lost in the swamps himself, and reminded people just how dangerous it is out there in the big bad world of politics.