Then there's the last line of Petter's press release. It says, "As part of its expansion strategy the agency will open its first branch in Victoria later this month."

Far be it from me to underestimate the importance of Victoria, but the majority of the organized criminal activity in B.C. runs through Vancouver. It would make more sense to open an office in Nanaimo, at least they have the Hells Angels and Vietnamese drug dealers. The only thing there is in Victoria is bureaucrats and politicians. Hmmmmm.

. . . "This would be laughable if it weren't so serious."

Politicians deny applying pressure

For the first time, the federal government's sponsorship scandal has been linked directly into the heart of former prime minister Jean Chrétien's office.

Jean Pelletier, Chrétien's former chief of staff and one of his closest confidants, made regular phone calls to the head of the sponsorship program, imposing political pressure on how millions of dollars should be handed out, says a staffer who worked in the office that administered the money.

Pelletier placed calls to Pierre Tremblay, the man in the public works department who held the purse strings for federal sponsorship money in the late 1990s, said the woman, who spoke with the Star on the condition of anonymity.

"Pelletier would call (Tremblay) on a regular basis to discuss sponsorships," she recalled.

[. . . .] It is highly unusual, government sources say, for a chief of staff in the Prime Minister's Office to call a mid-level bureaucrat in the public works department.

The woman is the third whistle-blower to talk to the Star in the past week about the involvement of civil servants and politicians in the sponsorship scandal. And she said yesterday she would be willing, although hesitant, to testify in public.

[. . . .] Senior politicians and bureaucrats including former public works minister Alfonso Gagliano; Don Boudria, government House leader at the time; Denis Coderre, then-secretary of state for amateur sport; and recently fired VIA Rail president Marc LeFrançois were all in frequent touch with Tremblay, she said.

And they were careful to ensure those conversations were clandestine, she said.

[. . . . Another said,] "I would like to speak, but I think for my job, I would think about it twice."

[. . . .] She said she is angry at high-ranking politicians, including Gagliano, who say they had nothing to do with the scandal.

"When they say, `No, we did not have discussions. No, we did not call them,' that's where I have an issue. Yes, they did call and it was about sponsorship."

Between 1997 and 2000, the government handed out hundreds of millions of dollars in federal sponsorship funds to community festivals, sporting events and other projects. The sponsorships were administered by a group of mainly Montreal-based advertising firms that collected as much as $100 million of the total $250 million in the program in the form of fees or commissions.

[. . . .] At one point, she said, one of Gagliano's assistants complained to Tremblay's staff that not enough sponsorship money was being directed to western provinces. "If he's saying that to us, obviously the minister's office was looking for money in specific ridings," she said.

Tremblay's meetings with his political bosses were deliberately absent from his official schedule on request from Tremblay or the minister's office, she said. And many of the phone calls Tremblay received from senior officials were transferred to a "secure" telephone line, the insider said.

She said staff in the office were told not to send e-mail messages related to the sponsorship issue and were instead instructed to make phone calls.

"When you're calling asking for secure lines, or calling and saying, `We can't talk on the phone, let's meet,' or you're not sending e-mails or you're meeting with Coderre and Boudria and don't want it in the agenda, you have to wonder."

While no one in the office was privy to the conversations between Tremblay and his political bosses, it was clear from his actions after meetings or phone calls what the discussions were about, she said.
"Immediately after talking to them, he'd call the president of an (advertising) agency or set up an appointment," she said. "He did express the fact that he was being pressured."

[. . . .] two other whistle-blowers . . . painted a picture of unrestrained waste, including millions of dollars handed out without even the most basic level of scrutiny or accountability.

[. . . .] The man, who also spoke on condition of anonymity, said he likely won't testify before a government inquiry if asked because it's a "career-limiting move and I don't want to be associated with it. I don't even put that (period of work) on my resumé."

Another person. . . , an advertising consultant . . . said Tremblay's predecessor, Chuck Guité, would run down a list of proposed sponsorship events each week or so, arbitrarily assigning dollar figures without criteria, analysis or consideration for the level of visibility the government would receive for the money.

"He'd go through and say, `$5,000, $15,000, $8,000, $10,000, $5,000, $50,000,'" she said. "Nothing was in writing."

[. . . .] The pitch from Stronach and her campaign team is that she's a new face -- a breath of fresh air inserted into a musty political scene.

[. . . .] But, in part, Stronach is not that new. Her economic ideas -- lower taxes, more money for the military, more incentives to encourage productivity -- are well-worn, rolled out by every candidate in every Tory leadership race for the past two decades.

Her health care views (formal obeisance to medicare coupled with a call for more private sector involvement) echo the conventional wisdom of the modern right.

Only her support of same-sex marriage is bold -- at least for someone seeking the Conservative party crown.

[. . . .] And many from Mulroney's old Quebec machine, including veteran organizer Senator Pierre Claude Nolin, have signed on with Stronach.

[. . . .] it does mean she is not entirely baggage-free. Politics is a reciprocal game; favours granted must eventually be returned.

Or, as Mulroney used to put it, "Ya dance with the one that brung ya."

So who's bringing Belinda Stronach to this prom?

Number 1 on the list is her father, Frank, the flamboyant, eccentric, rags-to-riches auto parts billionaire who now divides most of his time between a castle in Austria, his family compound north of Toronto and an apartment in Switzerland (where he lives in order to avoid Canadian income tax).

[. . . .] "Frank cares a lot about public policy," says Ed Lumley, a former federal Liberal cabinet minister who now sits as a director on the boards of three Magna companies and who has known Belinda since she first became a director 16 years ago.

[. . . .] One notable exception occurred in 1988 when [Frank Stronach] broke with most of the Canadian business class to run for Parliament -- as a Liberal -- against free trade and Mulroney.

[. . . .] Stronach lost, mended fences with Mulroney's winning Conservatives and transformed Magna into a multinational -- to such an extent that today almost three-quarters of its employees are outside Canada.

He didn't give up his behind-the-scenes work.

In 1995, after returning in triumph to his native Austria, he threw himself into the midst of that country's political scene.

Defying critics, he associated with top members in the ultra-right Freedom party whose de facto head, Joerg Haider, an open admirer of Hitler's economic policies, has been roundly criticized throughout Europe and North America.

In 1998, Stronach hired Karl-Heinz Grasser, then a key figure in Haider's party, to do European public relations for Magna.

Eventually, Grasser returned to politics as Austria's finance minister, which led to more controversy when it became known that Grasser had been secretly negotiating with his old boss -- Stronach -- to sell Austria's state-owned steel company to Magna.

[. . . .] She says she was an early supporter of Reform party founder Preston Manning when he first fractured the old Progressive Conservatives in 1987.

Yet, she was never a member of the Reform party.

In fact, she was never a member of the old Progressive Conservative party, or the old Canadian Alliance party. She says she joined the new Conservative party only when she decided to try for its leadership.

[. . . .] Even her supporters become vague when asked how they came to know her.

"I must have met her before," says Val Meredith, a British Columbia Conservative MP who backs Stronach and who was one of the original Reformers. "I only got to know her later."

[. . . .] Former Ontario finance minister Janet Ecker is working for Stronach as a paid campaign adviser. [. . . .]

Why does Bill Davis support Stronach? Because he knows her from Magna International, where he served as a well-compensated company director for 18 years.

[. . . .] Why does Harris support her? . . . . he, too, is a Magna director.

Like all Magna directors, Harris will reap the standard, generous stipend. In his case, that means $60,000 (all figures U.S.) in retainers, plus $1,500 per meeting for just showing up, $2,000 a day in travel expenses and up to $3,000 a day for any additional services -- as well as stock options. However, no one would suggest that Harris is backing Stronach for the money. He's got his rich MPP's pension.

Rather, he, like fellow-directors Davis and Lumley, is among the few people in the country who know her in more than a superficial way.

[. . . .] Lumley wouldn't vote for her in a general election. He's a Liberal and an old high school chum of Prime Minister Paul Martin. But he wishes her luck.

[. . . .] Davis' endorsement, for example, did not carry with it all of the Davis-era Tories.

Many, including Hugh Segal, himself a former failed Tory leadership candidate, are supporting Clement.

[. . . .] Some former Harris aides support Stronach but many of the old revolutionaries, including strategists Tom Long and Leslie Noble, went with their old pal Clement.

Even Mulroney's not-quite endorsement was insufficient to bring all of his old team on side. Toronto lawyer Sam Wakim, often referred to as Mulroney's best friend, is backing Clement. [. . . .]

As for Nolin, who owes his Senate appointment to Mulroney, he insists that his decision to support Stronach was not influenced by his old boss. [. . . .]

In the end, Stronach has Magna. The tone of her platform echoes what company insiders call the Magna culture -- a kind of enlightened despotism featuring employee involvement, personal development, continual skill upgrading, rich rewards for owners and deference to authority.

[. . . .] So why does someone give up -- temporarily at least -- a job that pays $9 million a year to run for the leadership of an opposition party?

[. . . .] Still, if she wins this leadership race, it will mark the first time she's held a post where her father was not the ultimate boss.

As Lumley says: "Her dad's an accomplished individual. And that in itself is not always easy to work with."