Thursday, January 25, 2007

Equalization roadshow - two different takes

Below is the text of a column (Straight Talk) by Randy Burton in StarPhoenix, a Saskatoon newspaper. That is followed by a local article on the same subject written by Craig Jackson of the Telegram.

As hard as it is to believe, there is actually a responsible opposing point of view to Premier Williams' case on Equalisation* although that's pretty hard to tell. It seems we live in a media environment that is supersaturated with mere echoes of the Premier's latest remarks on this or that.

Local media is largely a political monoculture.

I know that the first is a column while the second is a news piece but the fact is that the local columns and editorials almost all follow the same line with rare exceptions which prove the rule.

Show me a local column that comes anywhere close to the position taken by this Saskatoon column in taking on a fundamental position of the Premier and I'll buy you a drink - it seldom happens and when it does, it's ignored because it is so rare.

You have to wonder if the local media have a policy on premiers that is similar to the policy of many US media outlets on the presidency: domestic policy is fair game for criticism and comment; on foreign policy, back the man to the hilt in all cases.

The media does the province no good in acting like an echo chamber - it breeds denial.

The rhetoric of equalization

Newfoundland and Labrador Premier Danny Williams would have to be counted among the most persuasive orators in the country.

The way he can frame an argument, he could probably convince Sidney Crosby that he needs hockey lessons.
So no one should be surprised to hear that he can make an eloquent defence of Newfoundland and Labrador's special equalization deal.

It's the same deal Saskatchewan wants -- the one Prime Minister Stephen Harper has promised in writing no fewer than six times, in fact. The idea is that provinces with oil and gas, like Alberta, Newfoundland and Labrador and Saskatchewan, should be allowed to exclude the value of their non-renewable natural resources from the calculations under the national equalization plan.

This is a have-your-cake-and-eat-it-too plan, where you can enjoy a gusher of oil revenues and still get equalization payments.

Of course, Williams can dress it up much more nicely than that. He ties the issue to Newfoundland's long history of disappointment, from the death of the fishery to the province losing control over returns from its vast hydro-electric resources.

He equates his sweetheart deal, called the Atlantic Accord, with subsidies to the Quebec aerospace industry or aid to Western beef producers.

In the same way, Newfoundland merely wants to be able to help itself with its own resources and makes no apology for it, he told a Saskatoon audience on Tuesday.

"Gone are the days when we sit back quietly and watch our economic wealth leave our shores to benefit others. We fight tooth and nail for each and every benefit that we so richly deserve and that has evaded us for so long," he said.

The case he and Saskatchewan Premier Lorne Calvert make is a very simple one. As Harper likes to say, a promise made should be a promise kept. End of story.

There's no question it's an effective political argument, easy to understand and easy to sell.
The problem with it is that it ignores the fact equalization was never designed to be a regional development plan that makes a special case for less developed provinces.

It is supposed to be a national plan that allows provinces in different circumstances the ability to provide relatively equal services at relatively comparable tax levels.

There is no question equalization has failed to do that in the past, spectacularly so in Saskatchewan's case, where for a period of years we had more money clawed back through equalization than we actually made from oil and gas.

But to argue the solution is to simply load up the other end of the teeter-totter for a change makes no sense either.

If Calvert has his way, Ontario would actually have a smaller fiscal capacity than Saskatchewan. However, Ontario would still be contributing to equalization while Saskatchewan would be a big recipient. It's very hard to see how that passes the test of fairness that Saskatchewan claims is so critical.

When Saskatchewan Finance Minister Andrew Thomson suggests the federal government is "going to use Western oil money to essentially buy votes in Quebec," he is really sinking to a new rhetorical low in this debate.

In the first place, it can't be proven by looking at the available information on equalization. On a per-capita basis, Quebec contributes more to federal revenues, and thus to equalization, than Saskatchewan does.

These kinds of statements indicate just how far Calvert's New Democrats are prepared to go in their campaign against the Conservatives. Plainly, they aim to pit Saskatchewan and Western Canada against Central Canada and to paint Quebec as the illegitimate beneficiary of Western wealth.

This might be effective politics for the Saskatchewan NDP, but it's poisonously divisive for the country. Just for the sake of argument, let's say the Parti Quebecois takes power in the next Quebec election, a notion that is entirely possible. Thomson's accusation is just the kind of thing separatist premiers love to use when justifying another referendum.

There was a time not so long ago when Saskatchewan was regarded as a rational voice in federal-provincial relations. This debate is badly fraying that reputation.

For Calvert to stalk out of a meeting with the prime minister without so much as shaking his hand is not just rude, it's short-sighted. Whatever happens to equalization, Saskatchewan is obviously going to need federal co-operation on a whole range of other issues in the months ahead.

For whatever reason -- budgetary problems? -- the Calvert government is betting it all on this particular political initiative.

We have yet to count the costs of the collateral damage.


Premier outlines 'wrongs' of Confederation; Takes message west

For decades, many a Newfoundland and Labrador premier attempted to dispel the myth that the province is sucking the life-blood out of the rest of Canada, that the country's most easterly jurisdiction is dependent on federal handouts for the delivery of welfare cheques, health-care, education and public services.

Premier Danny Williams joined the ranks of those before him Tuesday, delivering his views on Confederation - and what it has meant for this province - during a speech to about 200 people at the University of Saskatchewan. Williams also took the opportunity to meet with Saskatchewan Premier Lorne Calvert, who's on the same page as this province when it comes to federal equalization.

"When we joined Confederation almost 58 years ago, our per-capita debt increased tenfold the very day we joined," Williams said in his speech. "Ironically, to this day, we have the highest per-capita debt in the country.

"Before Confederation, we were a nation that had come through the war in good financial shape and abundant in natural resources. Since Confederation, things have changed."

Williams' comments are all a part of his fight to ensure this province gets to keep 100 per cent of revenue generated from non-renewable resources and that Conservative Prime Minister Stephen Harper keeps his promise that those benefits will not be clawed back through a revised equalization formula, an $11-billion program which allows for the delivery of an equal standard of public services nationwide.

"If you're going to convince someone to buy into your argument on equalization, and the need for us to have relief on non-renewable resource revenue, you need to give them some history of our background," the premier explained from Saskatoon Wednesday in an interview with The Telegram.

"It's an education for people so that they can understand why (the equalization issue) is so important to us now and why it's important we get a fair shake."

Williams said in his Saskatchewan address that this province gave up its right to manage offshore oil and gas resources when it joined Confederation in 1949. Other Canadian jurisdictions, however, owned and managed their oil and gas resources because "they are under ground instead of water," he said.

When the mid-1980s rolled around, the province signed the Atlantic Accord offshore deal with the Government of Canada, a document designed to rectify the wrong that had been written, he said, "but the promise of the Accord and the reality of its implementation were two entirely different beasts."

Williams, however, tackled that wrong in 2004, convincing former Liberal prime minister Paul Martin to renegotiate the Atlantic Accord. The premier returned home with a $2-billion agreement that served as an advancement on future offshore benefits.

The premier also cited other examples of where Confederation has not been entirely fair to this province.

He took aim at the federal government's refusal in the late 1960s to allow this province to transmit power through Quebec as part of the Upper Churchill hydro project. As a result, this province ended up in a lopsided deal with Quebec.

"Our loss is estimated at a billion dollars a year, a billion dollars from our resource that goes directly into Quebec's revenues every year, a billion dollars that could make us a have province," Williams said.

The fishery, he said, is another example where the province passed control and management over to the federal government.

"Ottawa, in turn, used its control of our fishery to trade quotas to foreigners in exchange for other favours, and it mismanaged some species of our domestic fishery to the point of commercial extinction," he said.

"As a result of this mismanagement, tens of thousands of people have been forced to leave our province.

"Imagine, if in one day, 300,000 Ontarians suddenly lost their jobs as a result of the federal government's mismanagement of their (auto) industry. These circumstances would rightfully be described as a national disaster."

But when thousands of Newfoundlanders and Labradorians were displaced with the closure of the cod fishery in 1992, it was considered "a national nuisance," the premier said.


* A basic point of principle I have to teach all my starting debaters is that there is always a responsible opposing point of view to virtually any side.

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