01/11/2012 02:37 EST | Updated 03/12/2012 05:12 EDT

Rae touts signs of federal Liberal party's revival on eve of convention

OTTAWA - Bob Rae says he sees plenty of signs the once-mighty Liberal party is bouncing back eight months after being handed its worst drubbing in Canadian history.

Indeed, the interim Liberal leader predicted Wednesday that Liberals will be back in contention for power by the next federal election in 2015.

"Things change very quickly in politics," Rae noted after an all-day meeting with the Liberal caucus.

"The next election will be a competitive three-party race .... We shouldn't be shy at all about saying we're running the race to win. We have to have that in our heads right now."

Rae offered his optimistic assessment on the state of the party as Liberals prepare to gather later this week for a three-day convention aimed at modernizing, streamlining and restructuring the party.

It's the first gathering of the Liberal clan since the party was dealt its worst defeat in history in the May 2 election, reduced to a third-party rump with just 34 seats.

In a speech to caucus, Rae enumerated what he sees as signs of life in the party many declared dead after the election:

— The Liberal party raised a record amount of money from the general public last year — about $9.5 million — despite the humiliating election loss. That includes more than $1 million raised in December alone in what Rae described as the most successful email campaign ever undertaken by the party. It's still only about half what the sophisticated Conservative money-Hoovering machine raked in, however.

— Party membership has grown and, as of Tuesday, the Liberal caucus has grown, too, with the addition of Quebec MP Lise St-Denis, who defected from the NDP.

— A record number of Liberals — some 2,600 so far, with more expected — have registered to attend this weekend's comeback convention. Rae said that's more than the number of delegates who attended the last NDP and Conservative conventions combined.

"It's been a long climb since May 2," Rae told the caucus, recalling the "obituaries" that appeared regularly in the news media in the immediate aftermath.

Since the election, Rae said, Liberals "have shown that we can work together, that the Liberal idea is a deeply resilient idea. We've shown that the Liberal movement is strong and we've shown that the Liberal party is united as never before."

This weekend's convention has been hyped in some quarters as a do-or-die event for Liberals. But Rae and his MPs described it more modestly as one more step on the arduous road back from the brink of political oblivion.

"If there was a silver lining from May — and there weren't many — if there was a silver lining, it's that we have a time certain of four years in which to do our rebuilding in a meticulous, thoughtful, methodical way, step by step by step," said deputy leader Ralph Goodale.

"This is one step along the way but there are many other steps that will be taken."

Delegates will be asked to support proposals aimed at ensuring the party's long-term survival, including setting aside a "strong start" cash reserve that could be used to promote and defend the next permanent Liberal leader from the kind of relentless Tory attack ads that hobbled the last two leaders, Stephane Dion and Michael Ignatieff, before they got out of the gate.

Since May, the Tories have largely concentrated their fire on the NDP, which supplanted the Liberals as official Opposition. But they've recently begun going after Rae and his record of racking up debt and increasing spending during a turbulent term as NDP premier of Ontario from 1990 to 1995, when the province was sunk in a crippling recession.

Rae said he takes the "pot shots" as another sign of the Liberals' revival. And he offered a spirited and lengthy defence of his record as premier, which some observers took as a sign that Rae intends to run to become the Liberals' permanent leader, despite having explicitly promised not to do so as a condition of being named to the interim role.

"Listen up, Mr. Harper. While spending in Ontario increased by about 15 per cent under the Rae government over four budgets, (Finance Minister) Jim Flaherty's first four budgets increased program spending in Canada by close to 40 per cent. So I was a piker compared to Jim Flaherty and Stephen Harper," Rae said in his speech to caucus.

Speaking to reporters later, Rae said he was simply defending himself, refusing to "let the Conservatives define who I am." He scoffed at suggestions his speech heralded the unofficial start of his campaign for permanent leader.

"There's a lot of idle speculation about this. Every time I show signs of life, people say I'm running for the leadership," he said. "I'm just doing my job as interim leader."

Rae said it's up to the party's executive to decide whether to lift the prohibition against the interim leader seeking the permanent post. He said he has no intention of asking the executive to do so.

"I'm not asking anybody to do anything. Let me be very clear. I'm following the rules. I'm doing my job. ... I'm having a good time. I have no other plans beyond that."

There's likely to be much chatter among delegates to this weekend's convention about whether Rae should be allowed to seek the permanent leadership in a contest slated for the spring of 2013. However, the matter is only peripherally on the agenda and will not be resolved at the convention.

Convention delegates will elect eight new members of the 33-member national executive who will eventually have a say in the matter.

Four of the five presidential candidates are in agreement that Rae should be not be barred from running, although he would have to step down as interim leader once the contest gets under way.

Rae also weighed in Wednesday on several policy resolutions that will be debated by convention delegates.

He said he doesn't think a Young Liberal resolution calling for an end to the monarchy in Canada is wise, noting that it would require a constitutional amendment unanimously approved by the provinces.

He appeared more open to another youth resolution calling for legalization of marijuana. While he said it's up to delegates to decide, Rae reiterated his argument that the war on drugs has been a failure.

He said he hopes the party will be open to electoral reform. But he was non-committal about a resolution calling on the party to support replacing the current first-past-the-post electoral system with a preferential ballot, which would result in electing only those MPs able to amass more than 50 per cent of the vote in their ridings.