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Opinion Tax reforms, blind trusts and the 1 per cent: How it all went wrong for Bill Morneau

I feel terrible for Bill Morneau. He's a decent, stand-up guy. His devotion to public service is for real. He entered politics to serve his country and help make Canada a kinder, fairer place. No wonder he was Justin Trudeau's star recruit. He is exactly the kind of smart, hard-working and high-minded person who is all too rare in public life.

Now Mr. Morneau has discovered what many people have learned the hard way. Business is easy. Politics is hard.

The way he fumbled the small-business tax reforms was bad enough. The plan to tax employee discounts (what idiot in the tax department thought that up?) made things even worse. That wasn't even his idea. So unfair! Now comes a cascade of revelations that seem deliberately designed to remind Canadians that he belongs to the top zero-zero 1 per cent – and that they do not.

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Read also: How the Canadian government bungled the idea of 'tax fairness'

It's not just the villa in the south of France. It's the news that the villa happens to be owned by one of his private companies – a fact that he inadvertently, or conveniently, forgot to mention. It's the further news that he didn't put his substantial private holdings into a blind trust, as federal politicians usually do. It's the lingering perception that Mr. Morneau – a very rich man married to a very wealthy woman – is happy to go after farmers, fishermen, mommy doctors and other ordinary folks, while blithely exploiting the best loopholes for himself. It's the sense that our trust-fund Prime Minister and his jet-setting sidekick – who claimed to be fighting for the middle class and those working hard to join it – have no more clue about the middle class than they do about the undiscovered tribes of the deepest jungles of the Amazon. It's all terribly unfair, of course. The Liberals' popularity has plunged five points in the past four weeks, one poll found.

How did it all go so wrong?

Some blame rookie staffers. Some blame bad luck. The failure to disclose the corporation that owns the villa, according to Mr. Morneau's staff, was the result of "early administrative confusion." But the real problem is that Mr. Morneau has been hopelessly flatfooted. The public backlash took him by surprise. He allowed the opposition to gang up on him. He couldn't even explain his own tax measures to angry citizens. Worst of all, he had no idea that his wealth might work against him. As The Globe's Robert Fife said on CTV, "If you've got a finance minister who can't defend himself when it appears he's going after ordinary working people who are running small businesses, you've got trouble."

Back in the good old days, Mr. Morneau's appointment was applauded across party lines. He was praised for his prudence, his probity, his kindness and his social conscience. "When I saw his name, I thought, 'This is a fantastic choice,'" said David Dodge, the former governor of the Bank of Canada. "For Bill Morneau, the learning curve is going to be very short," predicted former prime minister Paul Martin.

Did Mr. Morneau try to bend the rules? Not a chance. He's not that kind of guy. But politics is rough, and even the perception of an appearance of a conflict of interest can generate unpleasant headlines that leave a bad impression in the public mind. One impression is that Mr. Morneau is the kind of guy who pals around with Steve Mnuchin. (In case you've forgotten, Mr. Mnuchin, Donald Trump's treasury secretary, is best known for trying to commandeer an Air Force jet for his honeymoon trip last summer. Mr. Morneau and his wife, Nancy, were at his wedding.)

It's true that Mr. Morneau doesn't mingle much with ordinary folk. He fits right in with the Davoisie – the global class of moneyed, progressive types who have big ideas to change the world. They believe in the transformative power of governments, if only they are led by the right people. They are the thought leaders who swooned over Tony Blair, Barack Obama and now our own Justin Trudeau. They believe in big concepts like "deliverology," infrastructure banks and the Innovation Supercluster Initiative. It's no accident that Mr. Morneau's economic advisory council is chaired by Dominic Barton, who also heads McKinsey & Co., the leading consulting company in the world.

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Life is harder down in the trenches. That's where Mr. Morneau is spending all his time these days, trying to salvage what he can from the smoking ruins. Yesterday, the Prime Minister himself showed up to give him an assist. At a pizza shop in Stouffville, Ont., the two men rolled up their sleeves and listened to Canadians. Mr. Morneau ate a hefty piece of crow. Mr. Trudeau announced that the government is cutting the small-business tax to 9 per cent.

Now if only they could explain away that damn villa.

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