Election looms as economy softens

Fri Sep 5, 2008 11:07am EDT
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By David Ljunggren

OTTAWA (Reuters) - Prime Minister Stephen Harper is preparing to call an election on Sunday that looks set to be dominated by the softening economy and a carbon tax plan proposed by his chief opponent.

Harper's Conservatives, who won power in January 2006, control a minority of seats in Parliament. Polls indicate a vote now would result in another Conservative minority.

The election -- most likely to be held on Oct. 14 -- will mark Canada's third in four years and comes at a time when the economy is struggling to cope with the U.S. slowdown.

Under a fixed election date law brought in by Harper, the next national vote was set for October 2009. Although Harper says he wants a poll now on the grounds that Parliament has stopped working, others suspect different motives.

"Stephen Harper wants to rush into an election before Canadians can realize how little he has done to prepare our country to deal with the slowdown of the economy," said Stephane Dion, leader of the opposition Liberal Party.

Growth so far this year has been anemic and the crucial manufacturing sector -- focused in parts of eastern Canada where Harper needs to pick up votes -- is struggling.

Harper, initially elected on a right-leaning platform that promised to crack down on crime and cut taxes, has said very little about his election platform.

That said, the Conservatives will strongly attack Dion's carbon tax proposal. Dion initially said the plan, designed to cut greenhouse gas emissions, would be revenue neutral.   Continued...

<p>Prime Minister Stephen Harper speaks during Question Period in the House of Commons on Parliament Hill in Ottawa June 18, 2008. REUTERS/Chris Wattie</p>