A useful guide to the Schreiber Inquiry

What the #!%* is the deal with the Mulroney-Schreiber Inquiry?

In this occasional feature, the Post tells you everything you need to know about an issue. Today, James Cowan on the Mulroney-Schreiber inquiry:

Who is Karlheinz Schreiber?

Born in Germany, Mr. Schreiber became a Canadian citizen in 1982. Over the past two decades, he ran a number of businesses in Canada, including a road marking company and a pasta enterprise. In 1985, he was involved in a bid by Thyssen, a German firm, to establish a light armoured vehicle manufacturing facility in Nova Scotia and later in Quebec. To aid this plan, he created Bear Head Industries, a lobbying firm aimed at garnering political support.

What is Mr. Schreiber doing these days?

He currently faces extradition to Germany on bribery, tax evasion and fraud charges. The Supreme Court denied his appeal of the extradition order, although the federal government agreed to keep him in the country until he testified at a federal inquiry into his relationship with Brian Mulroney.

Who is Brian Mulroney?

You must be joking.

No? Sheesh, kids these days. Mr. Mulroney was prime minister between 1984 and 1993. He met Mr. Schreiber more than 25 years ago, when the businessman helped Mr. Mulroney become leader of the Progressive Conservatives .

Why are Mr. Mulroney and Mr. Schreiber the subjects of a public inquiry?

Mr. Schreiber says he met Mr. Mulroney at Harrington Lake, the prime minister’s summer residence, two days before Mr. Mulroney stepped down in 1993. During this encounter, Mr. Schreiber alleges Mr. Mulroney agreed to promote the Thyssen project to Canadian officials. In exchange, Mr. Schreiber gave Mr. Mulroney three envelopes over the next two years, each filled with $100,000. For his part, Mr. Mulroney denies making a deal until after he retired as prime minister and says he only promoted the vehicles to foreign governments. Oh, and for what it is worth, he claims he only received $225,000.

People keep talking about an “Air Bus.” What is that?

In 1988, Airbus Industrie, a European company, sold 34 planes to Air Canada, which was then a crown corporation. International Aircraft Leasing, another company controlled by Mr. Schreiber, reportedly received a $20-million commission for helping to facilitate the sale. Seven years later, the RCMP launched an investigation into the deal, including allegations that Mr. Mulroney received a kickback. When details of the investigation were released to the media, Mr. Mulroney filed a lawsuit and eventually received a $2.1-million settlement from the government. No charges were ever laid.

Thanks for the history lesson, but what does that have to do with the inquiry?

As it turns out, very little. David Johnston, an academic who advised the government on the inquiry’s terms of reference, argued that in light of the extensive RCMP investigation, it would be “inappropriate” for the inquiry to revisit the matter. So this whole inquiry is designed to determine whether Mr. Schreiber is telling the truth about Thyssen deal?Yes, but there will be a couple of sideshows as well. The inquiry will also explore why Mr. Mulroney did not disclose the payments for tax purposes until 1999 and why Stephen Harper, the Prime Minister, did not receive a letter sent to him by Mr. Schreiber in March 2007.

But why should I care about an inquiry focused on events that occurred five prime ministers and 16 years ago?

Opposition politicians, academics and the government itself have all argued an inquiry is necessary to restore public confidence. As Mr. Johnston wrote in one of his reports: “the public interest issue is the integrity of government and whether there was a breach of constraints; and if not, whether there is a need for further constraints on former high office holders after they leave office.”