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john ibbitson

The German immigrants who settled this region in the 19th century were skilled and industrious. They built the twin cities of Kitchener and Waterloo into a manufacturing powerhouse. They were also suspicious and resentful of the Anglo-Saxon majority in the surrounding communities and up the road in Toronto, so they generally voted Liberal, because Liberals supported immigrants, even though their values were conservative to the core.

But times have transformed. Manufacturing has given way to vibrant high-technology spokes hubbed on the University of Waterloo, one of Canada's most precious assets. The region is awash in startups, incubators and condos filled with young high-tech workers of every racial hue. The descendants of the German-Canadian settlers have largely forgotten their hyphenation, though there's still a lingering chip-on-the-shoulder resentment of Toronto. A region once solidly Liberal is now marginally Conservative.

And in this election, the races in Kitchener-Waterloo are being closely watched. If Liberal Leader Justin Trudeau wants to beat Stephen Harper's Conservatives, he must make inroads here. In one key riding, the NDP is also in the mix.

This region, with an exciting future, could also signal the outcome of the next federal government.

Kitchener-Waterloo's capacity to regenerate is remarkable. One example: a former factory that was once the largest tannery in the Commonwealth now houses, among other things, Google Canada and Communitech, the much-written-about non-profit that incubates high-tech businesses.

"The notion of this economy reinventing itself, of this community reinventing itself, is nothing new," observed Iain Klugman, President and chief executive officer of Communitech.

A century ago, as the region transitioned from agriculture to manufacturing, Mennonite farms gave way to such storied brands as Electrohome and Schneiders. The shared German ethos of collective capitalism worked as well on the shop floor as during a barn raising.

It also gave rise to the technology-oriented University of Waterloo, whose pioneering co-op program created the synergies that have allowed the region to transition again, from manufacturing to high-tech, even as the rest of Southwestern Ontario staggers in the wake of hundreds of thousands of lost manufacturing jobs. Wilfrid Laurier University, next door to U of W, and Conestoga College make the twin cities an educational hub.

Unemployment in the Waterloo region, which includes Kitchener and next-door Cambridge, is well below 6 per cent. The provincial average is 7 per cent. In Waterloo, new firms have replaced the jobs lost by BlackBerry's decline; in Kitchener, entire blocks of abandoned factories and warehouses are being redeveloped into office space and condos.

On Thursday, Canada's newest technology darling, Shopify, announced it was opening a new centre in Kitchener that would employ 300 people. And Toronto-Dominion Bank is opening an IT centre in the city that will employ 120.

The streets are a mess, thanks to the light-rail line under construction.

And the old German settler culture has receded, replaced by a more modern and more multicultural dynamic.

"I'm not sure where you would go to find a German identity today," said historian Kenneth McLaughlin, who has just published a book on the evolution of the region's economy.

Along with this transformation, the old loyalty to the Liberal party – which had always made exceptions for popular Progressive Conservative and even NDP politicians – has dissolved, replaced by a shifting, politically pragmatic electorate.

Take the riding of Waterloo as an example. In every election from 1993 to 2006, when it was known as Kitchener-Waterloo, Liberal Andrew Telegdi took the riding by huge margins. But the Conservatives' low-tax, small-government message delivered the riding to Conservative MP Peter Braid in 2008, by a margin of just 17 votes. In 2011, the Conservatives widened that margin, though only to 2,100 votes.

This time, Mr. Braid – courteous and soft-spoken, with a background in business and international relations, hailing from the Progressive Conservative wing of the party – faces not one, but two challengers. Liberal candidate Bardish Chagger, a special projects co-ordinator at the Kitchener-Waterloo Multicultural Centre, radiates youthful energy.

"As someone who was born and raised in this community, I've seen us transform, I know what we're capable of," she said in an interview. "It's important that Waterloo's voice make it to Ottawa, rather than the other way around."

But the NDP is also a factor in the riding. Diane Freeman, an engineer and city councillor, tore up her Liberal Party card, she says, when Justin Trudeau decided to support the government's anti-terrorism legislation, Bill C-51. The riding went NDP at the provincial level in the last election, and MPP Catherine Fife is strongly supporting Ms. Freeman.

"The door has opened for voters to listen with new ears to the NDP," Ms. Freeman said. Mr. Mulcair, she believes, has made the party more compelling to voters who might have dismissed it in the past.

Who will take the riding? A riding poll commissioned by the progressive advocacy group LeadNow and conducted by Environics had the Liberals at 39 per cent in late September, the Conservatives at 31 per cent and the NDP at 26 per cent. But that's just one poll. The word from strategists in all three parties, speaking on background, is that Ms. Freeman is running a strong campaign.

At the plaza in front of Waterloo Town Square, a downtown (in Waterloo, they say "uptown") mall, Tony Theodosion is taking a break from work at the nearby pub he owns. He knows, emphatically, who he's not voting for: Stephen Harper.

As a small business owner, "I should be all for less taxes and for corporations and for making money," he says, "but that's not the case." For him, "a lot of people work and receive nothing, and a few people work and receive everything."

But Mr. Theodosion still hasn't decided who he will vote for. He'd like to vote Green, but figures that would be a wasted ballot. He'll decide on Election Day which party he thinks has the best chance of bringing Stephen Harper down.

But Mr. Harper probably will have the vote of Lashley Jagdhar, who, at 68, is retired and soaking in this glorious late-September-but-feels-like-June sun. Not that he's happy with the Conservatives: He highly doubts Mr. Harper had no idea what was going on in his office during the Senate expenses scandal.

But for him, the alternatives are worse. "I think he's not ready," Mr. Jagdhar says of Mr. Trudeau. "Maybe in another four or eight years." As for the NDP, he shakes his head. "Maybe if Jack Layton was alive."

Alex Unger, a young actor, is conflicted. "I really don't like Stephen Harper, but I really do like my MP," she says of Conservative Gary Goodyear, of Cambridge, who supports community theatre. She plans to make up her mind on Election Day.

If Waterloo is a three-way race, party insiders peg Kitchener Centre as a tight two-way fight between incumbent Conservative Stephen Woodworth, known for his strong opposition to abortion, and Liberal challenger Raj Saini. In Kitchener-Conestoga, which is partly rural, Mr. Albrecht is thought to be in no danger. And there is a new riding, Kitchener South-Hespeler, one of 16 new seats given to Ontario in the expanded House of Commons.

Whoever emerges the winner in the region will be expected to support the cities and universities that have galvanized the local economy into a new national centre of technology excellence.

And every candidate supports improved GO Train service to Toronto. That old German chip may be finally coming off KW's shoulder.

Editor's note: An earlier version of this story said Alex Unger was considering voting for her local Conservative candidate Harold Albrecht, of Kitchener-Conestoga. In fact she was referring to Conservative candidate Gary Goodyear in Cambridge.

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