Spending power, going once... twice... Any more bids?

The bidding war heats up...

PM eyes limits on Ottawa's powers Holds talks with several premiers May mean change to Constitution Prime Minister Stephen Harper is discreetly sounding out some provincial premiers about setting formal limits on Ottawa's powers, even if it means possibly reopening the Constitution, sources say. While discussions are at a preliminary stage, officials in Ottawa and several provinces suggested constraints on the federal spending power could eventually take the form of a constitutional amendment explicitly restricting Ottawa to its own areas of exclusive jurisdiction — a move that would reshape federal-provincial relations... [L]imits on Ottawa's spending power have been a key traditional demand of successive Quebec governments, who see it as a way to formalize the province's right to opt out of programs with full financial compensation from Ottawa. It is also one of five key requirements for Quebec's acceptance of the Constitution. "If we're going to look at (an amendment), it has to be a done deal, not a negotiation," said the senior official, who added the proposal could have considerable political allure in Quebec... Officials surveyed in a handful of provincial capitals and in Ottawa urged caution, but some Quebec Tories clearly believe constitutional renewal around an achievable goal — like restricting Ottawa's ability to intervene in provincial jurisdictions such as child-care — is the party's political ace in the hole in the province... As the Tories work toward a settlement on the imbalance — likely to be a key election plank for both Harper and Charest, who may also go to the polls in 2007 — there are also indications in Conservative circles that discussions have picked up steam since the Liberals' Quebec wing raised the prospect of eventual constitutional recognition of the province's status as a civic nation. That proposal has prompted considerable debate and sharp divisions within the Liberal party, but remains popular in Quebec. Conservatives inside the province have raised concerns about being outflanked as the federalist party most open to Quebec.

So let's see. The Tories start the bidding with international affairs. The Liberals counter with "nation" status. The Tories rebid with the federal spending power. There won't be much of Canada left, but eventually one of these two parties will be awarded the smoking mess they've created. The spending power, it should be said, had already more or less been gutted. The precedent of "opting out" -- ie a province, let's call it Quebec, could refuse to participate in a shared-cost program and still get the same money as if it had -- having been established in the 1960s, there were already severe constraints on any federal government's willingness to do anything creative in the social policy field. The Social Union agreement of 1999 formally forbade Ottawa even to launch a shared-cost program except where expressly permitted to do so by a majority of the provinces (even then Quebec refused to sign). And the Martin government's health care agreement, with its embrace of asymmetric federalism -- the first bid, I should say, before the Tories' "open federalism" gambit -- turned the Canada Health Act, the sole remaining example of federal conditionality, into a dead letter. So it's not clear what this latest "offer" means. Would Ottawa be prevented from transferring money to the provinces for health, education and other areas outside of its "exclusive jurisdiction"? I very much doubt it: the provinces love that sort of "intrusion." But my question is this: what does Ottawa intend to get in return for this latest concession? Or, in the world's weakest federation, is devolution -- more and more, faster and faster -- the only play our politicians know?