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News Hounds Sleep

While questions linger over 'Airbus affair.'

By Rafe Mair 29 Jan 2007 |

Rafe Mair writes a Monday column for The Tyee. You can read previous ones here. Mair's website is and his latest book, Over the Mountains, is at your bookstore...or it damn well should be.

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Bags of money?

The media can be biased in two ways, by what they publish and what they don't publish. What you will read and hear on a regular basis demonstrates how the Canadian media would feel quite at home in Mugabe's Zimbabwe. Our media is not only reluctant to examine any government in Ottawa, they get frozen keyboards even when it comes to previous leaders. Like Brian Mulroney, for example.

Back in the '90s there was a fuss about what became known as the "Airbus affair," which included allegations of secret commissions paid to members of the government of Canada, during the term of Prime Minister Brian Mulroney, in exchange for then-crown corporation Air Canada's purchase of a large order of Airbus jets.

In 1995, the Royal Canadian Mounted Police wished to determine what role, if any, Brian Mulroney, former Newfoundland premier Frank Moores and Karl-Heinz Schreiber, a professional go-between accused in the matter, played in the purchase. To complete their investigations, they felt it necessary to check in Switzerland banks for evidence. In order to do that, the Mounties set forth in a letter that they had "reasonable grounds to believe etc…" (It should be noted that Schreiber's name had previously been connected to Mulroney after Schreiber had earlier raised money for Mulroney's successful bid to win the leadership of the Progressive Conservative Party.)

Not only did Mulroney deny the charges, he sued the RCMP on the letter, claiming that it libelled him.

Lots of questions

Some people might have thought that an innocent Mulroney would have welcomed such a search and would have accepted the RCMP letter as a necessary preliminary to getting to the bottom of things. Instead, in 1995, Mulroney sued for libel demanding $50 million based on this seemingly routine RCMP letter. In what had to be the fastest legal genuflection of all time, the government paid him $2 million, one for himself and one for his lawyer. Considering the glacier-like pace Ottawa customarily displays this was not only a very interesting settlement, but also one achieved with incredible haste.

This raises the question: why? It is a question that the government refused to answer. What was it about this matter that made it worth, immediately, $2 million? Has an RCMP letter of this sort ever been held libellous in the past?

Why didn't the self-proclaimed Canada's national newspaper, the Toronto Globe and Mail, or the National Post, ask these questions and stay with the matter until a satisfactory explanation was given?

Did the Liberal government of the day have some skeletons in the closet that they wanted kept there? While there hasn't been a soupcon of evidence to support that notion, one still must wonder why a Liberal government would behave so generously with Brian Mulroney. In all events, 14 years later there is no answer to an uncomplicated question: why did the government pay Brian Mulroney $2 million?

But the plot thickens.

Mulroney, high-priced pasta expert

The Canadian television newsmagazine The Fifth Estate reported on Feb. 8, 2006, that a $300,000 payment came through a Swiss bank account code-named "BRITAN" from another named "Frankfurt," linked with the Airbus affair. Indeed the $300,000 was given to Mulroney by Karl-Heinz Schreiber, apparently in three lots of $100,000, in bills in shopping bags!

Schreiber, in an interview with the CBC program, said that the money came at the request of a Mulroney aide who told Schreiber the former prime minister was short of funds. Schreiber mocked Mulroney's claim that the money was a consulting fee for help given in a pasta business Schreiber had invested in. Indeed it would seem that Mr. Schreiber once asked Mulroney where to get a decent pizza in town and Mulroney sent him a brochure!

But this story wasn't a new one. In 2003, Edward Greenspon, the editor of the Toronto Globe and Mail, in his weekly page 2 editorial, told of this amazing transfer of all that loot to Mulroney. The only question was how much ($300,000 now seems accepted) and how it was delivered. We know it was in a shopping bag but now the evidence seems to be three occasions of $100,000 in three shopping bags.

One need hardly mention that lawyers don't usually get their fees in bags of small bills, 100 grand at a time. Assuming this is indeed true, wouldn't a prudent Mr. Mulroney assume that this was probably "tainted" money? And how did Mulroney use this money? Banks are limited in the amount of cash they can deal with before being required by law to investigate.

Indeed these two questions jump out at one: how the hell do you get $300,000 in bills? You can't just sashay to your bank and withdraw such a sum. And, once you have it, how the hell do you spend it?

Latest twist

But, it went further. Mulroney, upon hearing that the story was to be printed, begged Greenspon not to publish it and in exchange, he offered Greenspon an ever better story! One can only wonder what the better story could have been. At any rate, it didn't seem to pique Mr. Greenspon's curiosity. Instead of investigating the hell out this incredible nest of unanswered questions, Greenspon simply dropped the matter.

On the front page of the Jan. 24, 2007 edition of The Globe and Mail is a story by Greg McArthur saying that the government had sought evidence that might permit them to overturn that $2 million dollar settlement on the grounds that, contrary to Quebec law (the deal was done in Quebec) it was fraudulently obtained. When William Kaplan, a well known Canadian journalist, originally a defender of Mulroney and his government, heard of the $300,000 in the shopping bag, he was outraged but for some strange reason the media weren't interested and the story had no "legs."

This, then, is your vigilant national media at work.

Let's roll back a few years to 1991 when it was reported that then-premier Vander Zalm of B.C. had accepted $20,000 in a bag, originating from a source to whom he was trying to sell his theme park. There was no suggestion that Vander Zalm was accepting a bribe but that in his dealings, he had been in a conflict of interest position.

Here we have a former prime minister, known to have close relations with the Airbus deal fixer, Karl-Heinz Schreiber, first getting $2 million for a libel, then getting $300,000 in cash in shopping bags from Mr. Schreiber. The national media across the board breathed on their Orders of Canada, gave them a polish, then went about dealing with matters less embarrassing to their political friends.

Placid poodle

None of this is to assert, of course, that Brian Mulroney is guilty of any crime. Merely that his dealings merit much closer journalistic scrutiny than they have been given.

Unlike the national media, or any other I'm acquainted with, I have consistently raised these issues for almost a decade. I've been accused many times of being unfair to the national media whether it was over Meech Lake, the Charlottetown "Accord," Kemano II, Atlantic salmon fish farming in B.C., or just about the absence of decent reporting on B.C. news. I now rest my case. Those who accept the national media's version of events or, more often, their refusal to deal with them, no doubt are also looking for a bridge to buy.

This tawdry business doesn't just involve the Mulroneys and Schreibers. It is the entire Canadian establishment, the system if you will, that sees, hears and speaks no evil.

Is the national media the Canadian establishment's poodle?

What other conclusion can any intelligent Canadian come to?

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