By Bruce Cheadle, The Canadian Press
OTTAWA - Stephen Harper's Conservatives won a muscular minority mandate Tuesday night as Canadian voters entrusted the prime minister with the levers of government in tough economic times - but not a blank cheque.
The outcome saw the Liberals sink to their lowest level of popular support since the election of 1867 - and surely means a third change of leadership in five years for what was long dubbed Canada's natural governing party.
Aided by vote-splitting in Canada's most populous province, the Tories climbed to within a dozen seats of a majority. They did it without significantly boosting their share of the popular vote.
The Conservatives won 143 seats, up from 124 in the last election, while the Liberals were down to 76 from 103. The NDP was up by eight seats to 37, and the Bloc Quebecois shed one seat to 50. Two Independents also won.
In terms of vote share, the Conservatives got 38 per cent, the Liberals 26, the NDP 18, the Bloc 10, and the Greens 7.
Voter turnout was just 59 per cent, the lowest in federal election history.
"Our new caucus is broad and representative of Canada - in fact, it is the most representative of all the parties," Harper told cheering partisans in Calgary.
"At the same time, it's scope is not as wide as it should be. So regardless of how you voted, know that we will form an inclusive and responsive government that protects the interests of all Canadians in all communities of this country."
The prime minister said it "is the time for us all to put aside political differences and partisan considerations and to work co-operatively," but also vowed to push ahead with his party platform - modest as it may be.
But if Harper is expecting an easy ride in 2009, the economy may dictate otherwise.
How long before Canadians return to the polls - this was the third election in four years - could well rest upon the Conservative minority's ability to avoid a deficit next year in the face of slumping revenues and increasing social costs.
Harper said late in the campaign that a second minority would automatically give him a stronger mandate than his first, but NDP Leader Jack Layton weighed in with a warning late Tuesday.
"Canadians have elected a minority parliament," the NDP leader told his followers in Toronto.
"No party has a mandate to implement an agenda without agreement from the other parties."
Liberal Leader Stephane Dion sounded a more conciliatory note.
"We Liberals will do our part, responsibly, to make sure that this Parliament works," he said in his defeat speech.
"It is clear that our economy, indeed the global economic crisis, is the most important issue facing our country at this time."
It was a cup-half-empty kind of night for many.
Layton, who audaciously campaigned as a prime-minister-in-waiting, was denied the major breakthrough he sought. New Democrats remain the fourth-place party in the Commons.
In Calgary, when the national television networks declared Harper's minority victory shortly after the polls closed across most of the country, Conservative partisans awaiting the prime minister appeared in shock.
There wasn't a clap, cheer or groan from the several hundred gathered at the Telus Centre.
Re-elected Tory MP Jason Kenney put the best face on a result the Conservatives had hoped would be better when they breached their own fixed-date election law to force the autumn vote a year ahead of schedule.
"Every other incumbent government in the Western world is in serious political trouble with the economic situation," explained Kenney.
"Ours is probably the only one that could be re-elected - let alone with an increased mandate."
But the big losers were the Liberals and Dion, dropping more than two dozen seats from 2006. Dion, if he fails to survive the post mortem, will become just the second Liberal leader since Confederation not to serve as prime minister.
It is Canada's third consecutive minority government - something that hasn't occurred since 1965.
Ontario, which has so beguiled and befuddled Harper as a national leader, proved to be fertile turf this time around while his hopes of a majority were dashed by Quebec.
The Liberal vote sagged badly in Central Canada, once the Grit bread basket that had provided repeated majorities. Vote-splitting in Ontario, with ballots bleeding to the Greens and NDP, was particularly devastating to Liberals in the 905 belt ringing Toronto.
The Bloc shed just a couple of seats in Quebec, winning the province for the sixth consecutive election and leaving the Tories and Liberals treading water.
The Conservatives made a breakthrough of sorts in Quebec in the 2006 election, winning 10 of the province's 75 seats. In pursuit of a majority government, Harper courted Quebec voters assiduously throughout his first two-and-a-half year minority. He gave the province a seat on a UN cultural organization, offered up hundreds of millions of dollars in no-strings federal transfers to solve the so-called fiscal imbalance, and - most significantly - formally recognized the "Quebecois nation" in Parliament.
But those efforts did not pay electoral dividends. Stung by Conservative cuts to cultural grants and disconcerted by the government's hang-'em-high youth criminal justice reforms, Quebecers refused to add to the Tory seat count.
That setback was almost overshadowed by the Ontario results, where actual voting behaviour belied public opinion polling that had much of the province competitive for the Liberals.
Conservatives took 50 of Ontario's 106 seats, up from the 40 they won in 2006. The Liberals were down to 39 from 54 in the last election.
Grit fortunes were even more dismal west of Ontario. In Alberta, the NDP was taking more of the popular vote than the Grits, while the Green party was at eight per cent - just three points back of the Liberals.
Dion's first, best chance to make a statement on election night ended with slim Conservative gains in the Maritimes and evidence of a strong NDP attack on the Grit flank.
The Liberals, as expected, won the most seats in Atlantic Canada but did not make up any new ground and, in fact, lost a bit of turf to the Tories and the NDP.
In Nova Scotia, Green party Leader Elizabeth May's ambitious bid to dethrone cabinet minister Peter MacKay quickly turned to dust as the long-time Tory pulled away almost from the start.
"We ran an exuberant, a joyful and a positive campaign," said the Green party leader.
"And if the kids five years up could have voted, I would have won by a landslide."
Liberal candidates almost doubled the vote counts of their principal NDP competitors in Newfoundland and Labrador, where the Conservatives were shut out - losing three seats.
Danny Williams, Newfoundland's Progressive Conservative premier, mounted a noisy, nasty "Anything But Conservative" campaign against his federal counterparts.
The Liberals won six of the province's seven seats and New Democrats took one.
But it was by no means a Liberal red Atlantic tide. Tory fortunes were on the rise in New Brunswick and the NDP led the popular vote in Nova Scotia.
Liberals won 17 seats in Atlantic Canada, the Conservatives claimed 10, the New Democrats four and there was one Independent, former Tory Bill Casey elected in Nova Scotia.
After 37 days of negative and often bitter campaigning, Canadians heading out to exercise their franchise were greeted Tuesday with some good news.
The gloom on Bay Street was replaced with an 890-point leap as Canadian markets followed their resurgent U.S. counterparts after the Thanksgiving Day holiday. The S&P/TSX composite index closed up 9.8 per cent after plummeting 16 per cent last week.
The loonie also clawed back 1.4 cents on Tuesday to close at more than 86 cents US, after tumbling almost eight cents in the last week of campaigning.
But this remained an election in which a global credit crisis and looming recession reared like a B-movie Godzilla in mid-campaign, smashing the best-laid plans of all the contenders.
The new Canadian government will spend at least the next year grappling with the economic fall-out, a time when shrinking government revenues and heavy demand for social programs - including employment insurance claims - could force hard decisions to avoid running a federal deficit.
Harper ignored his own fixed-date election law to drop the writ on Sept. 7. That was more than a year ahead of the October 2009 date envisioned in Conservative legislation that passed the Commons with little dissent.
In sending Canadians to the polls before his government could be defeated in the House, Harper claimed the minority Parliament had become dysfunctional and that he required a fresh mandate to navigate the troubled economic waters ahead.
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