Tuesday, April 24, 2007

Self-reliance and job fair

CBC TV and VOCM both carried a story on the latest Alberta Job Fair held at the Mt. Pearl Glacier today. Alberta employers conducted quick interviews with up to 2500 interested job-seekers. More than 1000 people were expected to be hired today.

At the same time people were lining up to leave the province for employment, government's plan for this legislative session were outlined in the annual Throne Speech.

The theme was "Self-Reliance".

By self-reliance, government means that it should not rely on outside factors to solve it's problems - it must solve them itself.

For the people at the Glacier, self-reliance means not relying on the government of Newfoundland and Labrador to solve their problems - they must solve them themselves.

Nationalism and moral autonomy

According to today's pre-election Speech from the Throne delivered by the Honourable Ed Roberts, this government plans to "achieve self-reliance by becoming masters of our own house."

The speech outlines lots of rhetorical flourishes that flirts with separatist sentiment but the most ambitious of any government plan anywhere is outlined in the part where this government:
"Will harness the desire among Newfoundlanders and Labradorians to cultivate greater cultural, financial and moral autonomy vis-à-vis Ottawa."
Moral autonomy? Who knew the people of this province was yearning for a system of morality that was distinct and unique to this province? And I thought Quebec was a distinct society but here, is seems, we have a morality all our own!

And government approved to boot!

Instead of the Ten Commandments, we will have the Government of Newfoundland and Labrador Official Moral Guidelines as developed by the Department of Morals and Ethics (Hon. John Hickey, Minister).

The process will start with a moral due diligence piece and drill-down through a cross-jurisdictional survey examining best moral practices across Canada.

Then there will be the Public Consultation on Provincial Moral Autonomy. I'm looking forward to that so I have have my input on what morals I'd like to see included (or excluded, for that matter).

I'm sure moral enforcement will be a controversial issue but I bet the RNC is up to the job.

At the end of the process there will be the obligatory Morals glossy brochure sent to every household in the province.

You'll know it's official by the little triffid logo on the cover; official, government-developed, government-branded, provincially distinct morals autonomous from those moral imperialists in Ottawa.

Who would have thought.

"Thy shalt have no other Gods before me" indeed.


Maîtres chez nous! (Masters of our own house!) was the rallying cry of Quebec Premier Jean Lesage and his ruling Liberal party in 1962 when he called for the nationalization of all 11 privately owned electric power companies in Quebec. Does that foreshadow planks of the provincial energy plan? Time will tell.

Monday, April 23, 2007

Premiers spurn Premier

How does a premier garner national attention and support for their issue?

They make it a national issue and build support amongst colleagues using any national platform they can to push their agenda forward.

So it's more than just a little significant when the Council of the Federation* issues their agenda for their next meeting and Premier Williams' current topic de guerre is conspicuously absent.

On May 1, the Premiers meet in Toronto to talk about climate change and energy plans so they can meet in Moncton in August to talk about climate change and energy plans.

Oddly, equalization seems to have dropped off the national agenda. And that's not a problem unless you still have unresolved equalization issues.


Council of the Federation is the current formal name for the Premiers' regular opportunity to complain about how the feds aren't giving them enough money fast enough.

Thursday, April 19, 2007

He's right this time

It's no secret I've had little patience with the way federal-provincial relations have been conducted by this provincial government over the last few years.

I've never subscribed to the school of thought that says that the ideal NL politician has to come from the mould of the fighting Newfoundlander (and/or Labradorian).

You know the kind. We've had Smallwood and two Brians and now we have Premier Williams. Their defining characteristic is their willingness to drop their gloves at the slightest provocation and to fight fight fight for the people of the province.

They have been the enforcers of the province's rights and privileges in that great national hockey game of federal-provincial relations; political goons with the sharp elbows and the high stick.

But rarely are they able to do what this province really needs - score more goals and win more games.

And that applies to Premier Williams more than most past premiers. We thought we were electing a great negotiator. Instead we elected a showboating scrapper who has politically isolated himself and this province across the country while goosing local polls to stratospheric levels.

I always held the opinion that the best background and education for a NL premier would be a stint at the United Nations. I suspect that a successful diplomat with the negotiating skills to build bridges to other provinces, grease the way with the federal government and pave the way with industry to produce economic developments could accomplish great things.

A diplomat understands that your friend yesterday might be your enemy tomorrow and your ally next week. A negotiator recognizes that a great deal is one where everybody gives some, everybody gains some and everybody goes home happy.

But that just isn't possible with this premier. His enemy yesterday is his enemy today and his enemy next week and forever. And you don't need to take my word for it. I'm sure if you took aside Fabian Manning or Elizabeth Marshall or John Crosbie or any other of a number of good, faithful (Progressive) Conservatives of great integrity and skill, they might tell you the same.

And unless you can accept the idea that any set of negotiations must inevitably result in his win and your total and humiliating loss, then you had best take your business elsewhere. Again, my word for this doesn't count nearly as much as the word from any of the Hebron partners, for example.

In politics, friends come and go but enemies accumulate.

This is a long way to noting that in Premier Williams' latest salvo over the NL-fed equalisation dispute yesterday, Premier Williams called upon federal Finance Minister Jim Flaherty to resign.

It's worthwhile noting also that so far, in addition to calling on Flaherty's resignation, he's also called for the resignation of regional minister Loyola Hearn. While he hasn't yet called on the other local Conservative MP's , Fabian Manning and Norm Doyle, to resign immediately he has called on them to hang their heads in shame.

Just as well Norm Doyle is declining to run again. As for Manning, since Premier Williams has already promised a goose egg of federal Conservative MPs in the next election, Williams' threat to Manning could be considered a call for deferred involuntary resignation.

As for the federal government itself in toto, he has said that he can't wait until this government falls and another takes it's place.

So Premier Williams has called for the immediate or delayed resignation, or otherwise removal from office, of just about everyone in sight.

What's left for Premier Williams to do to get his point across?

Well, he does have the option of a cross-country speaking campaign. But he's already done that.

He could take out newspaper ads to slag the federal government and put forward the province's point of view. But he's already done that too. And of course there's always an alliance with another province in a similar spot to tag-team the feds into submission.

I think I've heard that he's already tried something like that too.

But here's the real question: after calling down the lightning, thunder and rain onto the heads of the terrible enemies of this province (that evil federal government) over and over again for political disputes of all kinds, will anybody pay attention anymore?

And, is this dispute with the federal government different in kind from the Williams-Ottawa disputes that have gone before?

I believe this dispute is different from the ones that have gone before. Previous fights with Ottawa were about money. And there will always be disputes with Ottawa about money. But this one is different because it now affects fundamental pieces of enabling legislation.

The federal government wants to unilaterally amend the 1985 Atlantic Accord.

The 1985 Atlantic Accord is not like other pieces of federal legislation. This Act was negotiated between the province and the federal government over many years to effectively transfer portions of federal jurisdiction to this province. Once agreement was reached, both levels of governments passed enabling legislation.

We forget that we don't own the oil offshore - we never did, we don't now and we never will. Ownership is in the hands of the federal government and that has been definitively confirmed by the highest provincial and federal courts.

But under this Act we are given the right to control development, to tax and otherwise manage the resource as if it were on land.

In effect, because of the nature and scope of the Atlantic Accord, it has a status above other normal pieces of legislation and falls just below the level of the constitution itself. It has the effect of a bilateral constitutional agreement.

To unilaterally amend this Act, without even informing this province, is unacceptable.

If the federal government can move forward on actions like this then it could unilaterally overturn any previously negotiated federal-provincial agreement at will and shred the fabric of prior negotiated settlements that has knitted this country together.

This is not right and Premier Williams is within his rights to make as much noise and generate as much pressure as he can to overturn this decision.

It's just too bad that Williams has no more diplomatic tools at his disposal when he, and this province, has so much need for them.

Wednesday, April 18, 2007

No balanced budget law in NL

Once thing you could say about former finance minister Loyola Sullivan, you could take him at his word even if you couldn't understand it. That stands in sharp contrast with his successor.

On CBC radio this morning is a report that Marshall won't be fulfilling the commitment of his predecessor to bring in a balanced budget law. He says that it's enough for government to merely explain to the public why there will be a deficit and that, in essence, he doesn't want his hands tied.

There are a few things about this worth noting.

A balanced budget law (BBL) does not prevent a government from running a deficit if it has to. A BBL is a law, passed by the House of Assembly which is a pledge, promise or commitment that any budget brought forward will not have a deficit.

Does it tie government hands? Only in a political sense. If circumstances change dramatically and the government is forced to bring in a deficit, it still can. It just has to amend or revoke the BBL to allow it.

But the BBL has the effect of raising the political bar to a budget deficit. If government is going to spend more than it brings in, it has to break that prior pledge not to in a very deliberate and explicit way by amending or revoking it's prior legislative commitment.

Marshall says it should be good enough for government to discharge its responsibility by explaining why the deficit has occured.

Well, minister Marshall, that's not good enough. It's that sort of low to nonexistent bar that has brought us to the position of having the highest per capita debt, and associated service charges, of any jurisdiction in the country.

If there was any time it was safe for this province to make the balanced budget pledge, it is now.

In 2005-06, this government had $500 million net surplus (cash and capital), carried forward $300million and put $200million on debt. In the following year, government still saw a surplus (while doomsaying to the contrary) despite the six month closure of the Terra Nova money flow.

Trends continue to look good for the next 5 to 10 years, and even longer if Hebron and Hibernia South comes on stream. Never in our province's history has the fiscal situation looked so good.

Does this government have to go into deficit even if revenues drop? Not even close. There is tremendous amount of give in the existing expenditure patterns. At $8600 in spending per person, it is the second highest of any province in Canada.

While this government perpetuates the myth that our geography increases the costs of supplying services, in fact doctors and nurses in Stephenville don't make close to what doctors and nurses make in Ontario urban centers. That's why Stephenville can't attract or retain doctors and nurses. That low cost of local labour of all kinds goes a long way to leveling the costs imposed by geography.

And that still doesn't justify the fact that we have more public servants per capita than any other province. We have more people on the government payroll today, in absolute and relative terms despite population shrinkage, than when this government took over.

Government talks a good game of debt reduction. At the same time it has been determined to avoid any kind of concrete pledge or commitment to actually doing anything about it. At the end of the Williams government first mandate, there is no sign of a debt reduction plan in any way shape or form other than an acknowledgement that is exists and it's a problem.

The size of the debt has been a constant refrain in government's case against the federal government in this ongoing equalization war. That plank in the government's case would be more believable if there was a debt reduction plan on the table.

Instead, debt reduction is a mere rhetorical tool to beat up on the feds.

It's not like this pledge was made by another government or that Sullivan made the pledge while he was in opposition (and as we all know, promises don't travel well on the trip from opposition to government). This pledge was made by Loyola Sullivan while he was minister of finance in this very government.

The pledge was good enough for this government then, why is it not good enough now?

Monday, April 16, 2007

Next federal election

OffalNews brings you the highest level of analysis in public affairs, economics and politics. Below is our synopsis and prediction for the next federal election.

Friday, April 13, 2007

Ministers victims to media reports - Can't read

I've worked for ministers over the years and I've seen the kind of briefing notes, files, books, binders, and boxes they have to plough through. Before any decision is made or any action taken, ministers are briefed with more information than you can imagine.

In my experience, there is rarely a problem with insufficient information. In fact, the reverse is true. Most times there is so much information coming at ministers on all kinds of issues, large and small, that they are overwhelmed.

Sometimes, it gets so bad that it's hard to distinguish what is an important issue from what is trivial.

Finance ministers, by virtue of the job they hold, get vast volumes of information, possibly more than any other portfolio. The get more kinds of numbers, scenarios, analysis and projections than you can shake a stick at.

Federal minsters who are also the regional ministers for their province, are flooded with information for their own portfolio and also the information for every other portfolio as it pertains to their province.

Under this system, in this province, you can be sure that Tom Marshall, Finance minister, and Loyola Hearn, federal regional minster, would be kept up to date on the most important fiscal issue and political hot potato in this province today - equalisation.

So why are these two politicians acting like they don't have a clue what the numbers are? Are they reduced to picking information out of the newspapers like the rest of us? Do they ever review their briefing materials or are they sailing along by the seat of their pants?

Early this week, local economist Dr. Wade Locke said that the federal offer, over the next 20 years, represented $6.5billion more while the provincial position represents an additional $4.5billion.

Keep in mind he was clear at the time that these were preliminary figures based on a provisional interpretation of the legislation and a whole lot of numerical assumptions. Locke's hope, he said, was that both sides would be forthcoming with numbers of their own so that clarity could come over this issue.

No such luck.

Instead both Hearn and Marshall seized the results and dashed to the news media claiming how Locke's research vindicated them. Hearn crowed about an additional $6.5billion and Marshall whined about a lost $4.5billion.

Then Dr. Locke has revised his numbers fairly dramatically. Now the federal offer apparretly represents $1billion LESS than the status quo, a shift down of $7.5billion from his earlier interpretations.

You would think the Hearn would release numbers of his own to defend the federal position. He does not. Instead he's reduced to a weak claim that no province will be harmed.

But does he actually have any real idea whether the province will be harmed? Apparently not.

As for Marshall, he's definitely on the warpath now. And you can expect the Premier to be leading the barbarians at the federal gate as soon as he gets home.

But didn't Marshall already know that Locke's numbers were off in the first place?

Both of these senior ministers have to have projections of their own. Are they keeping them to themselves for some high strategic reason? Are they getting around to reading them at all?

What happens next week if Locke or another analyst announces that the provincial and provincial offers are both exactly the same at, say, $16billion over the status quo. How will Hearn and Marshall respond then?

Will they know any different? And if they do, will they let us in on the secret?

Tuesday, April 10, 2007

Monday, April 09, 2007

Bloggers without Borders

I'll be dealing with the issue of breakfast wraps in an upcoming post.

(Apologies to the New Yorker)

Politics Watch says Loyola Hearn possible election casualty

Politics Watch, a respected national political website, has posted an article outlining four federal ministers who may have trouble returning to Ottawa if the election was held sooner than later.

The four ministers are Michael Fortier (PQ), David Emerson (BC), Tony Clement (ON) and our very own Loyola Hearn (NL).

The article argues that Hearn could suffer from running against not only his riding opponents but also NL Premier Danny Williams.

While there had been rumours that Hearn might be passing on running in the next election, his latest public statements indicate a new feistiness. He's been vigorously defending the federal budget in the face of withering criticism from Premier Williams and has announced more than $100million for projects ranging from new armed forces facilities to literacy programs.

There has been considerable strain and antagonism between Williams and Hearn from the moment Hearn entered cabinet. Most remarkable was a recent CBC video news report where Hearn dismissed Williams as a "loudmouth" who declined to be there for his party during the "hard times".

Hearn has been quoted as saying that he's not not ready to be "forced out" of politics in the same way former Liberal regional minister John Efford was hounded from office by a Williams-led campaign.

Premier Williams - Not just all about equalization

Snagged from this weekend's Globe and Mail (my apologies)

Former Hydro-Québec president running for Harper?

It turns out that the Harper Conservatives are going to be running a host of star candidates in Quebec. One of them could well become the next minister of Natural Resources or otherwise a powerhouse in the next federal government should he, and his party, win.

Former Hydro-Québec president André Caillé is being tapped to run in a south Montreal riding.

Here is an interesting interview with him where he outlines his point of view on a number of different issues related to energy.

I expect it won't take long for this issue to explode on the local talk radio shows to the detriment of Harper's NL candidates. Just when you thought that Premier Williams' ability to influence this federal government couldn't get any lower, it gets worse.

Calvert influential - Williams, not so much

The Globe and Mail has a story covering Premier Lorne Calvert's interview on CTV's Question Period broadcast yesterday.

Calvert took the opportunity to show that he was just as angry as Premier Danny Williams and reinforced his claim that Prime Minister Stephen Harper simply didn't keep his promise to fully exclude non-renewable natural resources from the formula used to calculate equalization payments to the provinces.

The story goes on to point out that while the federal Conservatives have 12 of the 14 seats in Saskatchewan (the Liberals have the other 2, in NL the numbers are just 3 Conservatives (Liberal have the other 4).

This puts Williams, although noisier, in the unusual position of having less influence with less to bargain with than his erstwhile ally.

This raises and intriguing possibility: would Prime Minister Harper cut a deal for Saskatchewan in a bid to keep the those 12 seats and cut out Premier Williams?

The advantage to Prime Minister Harper would be the opportunity to be a hero in Saskatchewan and save 10% of his caucus. There seems to be no serious disadvantage except potentially losing minister Loyola Hearn who may not want to run again anyway.

It's not like Harper has very much to lose by further annoying Premier Williams.

Hebron: The word from the ground

The Placentia Charter, another of the NL weekly Transcontinental papers, last week published an interesting story on the loss of Hebron called "To produce or not to produce – that is the question" .

The Placentia area would be ground-zero for much of the fabrication work that would have to be done to make Hebron a reality and so a major source of employment for local residents. It's little wonder that the local paper has a point of view on the way government has handled this matter.

It reads in part:
To not keep the door open would be catastrophic to the economy and some say that Premier Williams, though indirectly, did just that.

Several months ago Mr. Williams felt that not continuing with the ongoing oil and gas related discussions may be in the best interest of the province. Williams felt Newfoundland and Labrador could not get its fare share due to the tax structure and the royalty regime while dealing with companies such as Chevron, Exxon Mobil, Petro-Canada and Norsk Hydro.

These are not low-ball players like Mr. Williams may take them for. They will not stick around to play hard ball while other developments are taking place in the world that need their immediate attention.

The development of Hibernia South is considered to contain 220 million barrels of oil and would considerably add to the life of Hibernia for approximately 10 –12 years.

Why travel to Alberta and say ‘we are the best in the East for development’ while the premier is not even talking to the big players.
Much of the article takes a different point of view from many and compares and contrasts the situation in Norway with the situation here. This is a fine piece and is a good example of what these weeklies can produce.

Weekly paper decries Williams "cult of personality"

The local regional papers across NL tend to reflect the point of view of their readership because the writers are so close to the people who buy their papers. At the same time they tend to be fairly conservative in their selection of stories - high on human interest and low on bucking popular waves.

If they are going to criticise government, they are going to go to the local hospital and slag the Health minister for doing a lousy job. In the face of concrete issues like that, general criticisms of overall government direction takes a back seat.

And rarely will a local paper go out of their way to call a popular Premier out on the carpet for an apparently popular conflict. That, conventional wisdom says, doesn't sell papers.

So when you see a piece like this one in the Grand Falls Advertiser, a central NL weekly, you have to take note of it. It says in part:
The domain of personality cults isn’t limited to dictators. There are celebrities, with either fanatical followers or who belong to cults themselves (hello, Tom Cruise). And on the home front, there was our Joey Smallwood, who had many Newfoundlanders by the short hairs for more than 20 years. And while we got into Canada, he was blamed for selling the shop when it came to the Upper Churchill power agreement; brought in a crook from Latvia, Alfred Valdemanis, into his government, forced resettlement, and the list goes on.

And now, Premier Danny Williams is riding on the waves of his own personality cult. Danny can do no wrong, judging by the polls.

But are the masses always right?
Check out the rest of the piece here.

Williams has no effect on fed polling numbers

Another day, another national poll. Expect quite alot of these over the next while. The latest comes from SES Canada Research commissioned by Sun Media. It shows that there will be no election this spring for the simple reason that no party is close enough to a mjority government to risk precipitating it.

Nationally, the Conservatives registered the support of 36% of decided voters, still short of forming a majority government. They are followed by the Liberals at 33%, the NDP at 16%, the BQ at 10% and the Green Party at 6%.

As the Toronto Sun points out:
In the Maritimes, all the Harper-bashing by Newfoundland Premier Danny Williams over the budget has not altered Conservative support from two months ago. In fact, it is the Liberals that have bled about five points to Jack Layton's NDP and Greens, although the Grits still lead the Tories 40% to 28%.
It's too early to tell whether their interpretation is accurate but, as of right now, it seems that Williams' battle with the feds has had limited impact even at the local/regional level.

The cost/benefit of Williams anti-federal government campaign is clear - he has to have impact on the election results with the hope of mitigating the damage he's done to federal-provincial relations. However, the longer in the future the election is held, the less impact Williams will have on the outcome of even local races.

In other words, the opportunity for influence is fleeting while the impact of the damage is lasting.

Saturday, April 07, 2007

Williams blows smoke: No Hebron talks

I've mentioned before, most recently here, that Premier Williams likes to make casual statements as reported here:
Williams said Tuesday officials with his government and Newfoundland and Labrador Hydro are in discussions with partners in the project "all the time."
He wouldn't go into details of those discussions.
Premier Williams does not specifically claim that the discussions with the partners have anything to do with Hebron although he does try to leave that impression. In fact, both government and the Hebron partners (who are also the Hibernia and Terra Nova partners: ExxonMobile, PetroCan, Chevron et al) talk all the time over operational issues, Hibernia South and other non-Hebron projects without ever talking about Hebron itself.

In fact there have been no discussions at all since the Hebron talks collapsed a year ago. The simple evidence of that is, while premier Williams tosses off vague and bland assurances that everything is under control, industry is very quick to confirm to confirm, yet again, that there are no talks ongoing at all and there haven't been any in a year.

In the Telegram today, Tim Murphy, Chevron's (almost) last man left in the province, says so explicitly:
"Nothing has changed on Hebron. There are no discussions or negotiations ongoing and none are planned. At this stage we don't know what it will take or how long it's going to take to get back to that. From our perspective, as operator, no discussions or negotiations are ongoing. We're not talking to the province about Hebron." [emphasis added]
So while Premier Williams prefers to pretend that the matter is under control, this latest story shows beyond any reasonable doubt that the government's oil development file is not under control at all.

It is way out of control; there have been no talks between government and industry on a potential $10-12 billion government-revenue project in a year.

You can't help but ask a few questions about this.

The first is, what is government waiting for? What "winning conditions" are required before opening talks that will win the province, government and people, a steady source of revenue and jobs for at least 15 years in all? It's not like the federal government will put through the kind of expropriative legislation the Premier wants because they won't. And if the goal is to await far higher oil prices, that's a very risky and irresponsible game at best and won't make a difference since any deal would take that into account.

Second, how is it possible to ever reach a resolution to this matter unless and until government engages in talks. One this is for sure: it is impossible to negotiate unless there are talks and every day there are no talks is another day farther in the future that this project will come to pass.

Third, since there are no talks, why does the Premier want to provide the illusion that there are some kind of back-channel communications. (If there are then they are so secret that industry is not privy to therm.) It seems so uncharacteristic that Premier Williams is simply not announcing to the world that there are no talks and there will be no talks, unless and until some kind of preconditions are met.

Instead we have a sort of chagrined dissembling; none of the bombastic pride the Premier usually derives from conflict. Let's hope that's not because this conflict has already been fought and lost.

Finally we have to wonder: if industry says they are not talking to government and government is saying they are talking to industry, who is Premier Williams actually talking to?

Thursday, April 05, 2007

Danny Williams: Losing his balance

There's a delicate balancing act that every NL politician must master in putting their position forward, especially, but not exclusively, to a national audience.

On one hand they need to be strong, clear, articulate. They also need to go farther than, say the Premier of Ontario, in order to overcome the obvious political disadvantages of coming from a relatively small province on the geographic margins of the country.

You need other qualities to compensate.

John Crosbie is probably the best example of a NL politician being successful on the national stage. No one doubted his smarts, skills and integrity.

But that wasn't enough to push his agenda forward. He also had to be witty, colourful and grab public attention in the way few politicians ever do.

Still, he never fell into the trap of becoming a caricature of the grasping, pork-barreling local pol-made-good even when he launched his internal war, on behalf of his province, within the Mulroney administration for federal investment in Hibernia.

People called him wrong and misguided but there was always underlying respect for him. In that delicate balance, few ever matched Crosbie's political gymnastic skill.

Then there is the current national public reaction to Premier Williams latest crusade. Here is a small sample of today's editorial coverage.

From the Globe and Mail
With his glib tongue and fast temper, Danny Williams has never been known for his diplomacy. But the Newfoundland and Labrador Premier has run amok over the past two weeks with his inflammatory complaints about how much his province will receive in transfer payments in the recent federal budget. Newfoundland has been "shafted," he declared.
. . .
Mr. Williams has long been anxious to obtain the best deal for his province in everything. But now he has become careless, because Canadians in other provinces are figuring out just how much he is pocketing. They should stand with Mr. Harper in his fight.
From the Windsor Star:
Governments at all levels and of all stripes already use tax dollars to fund advertising for policies that are nothing more than thinly disguised partisan ads. Spending even more tax dollars on advertising in a dispute that could better be waged with press releases and opinion articles in newspapers represents an extravagance governments in these lean times can ill afford.

If Williams and Harper can't start acting like adults, voters should think about cutting off their allowance.
From the Edmonton Journal
Of course, none of the substance of this is remarkable. Williams is indeed playing fast and loose with the facts on equalization, and the Conservatives' recent advertising assaults on the Liberals are no different from salvos fired in the other direction during past elections.
From the National Post
If Danny Williams, the Newfoundland and Labrador Premier, were trailing in the polls, his latest hysterical attacks on Prime Minister Stephen Harper could be explained away as mere electioneering. But his provincial Conservatives are so popular -- polls measure his support as being as high as 70% -- that their re-election is all but assured in this fall's elections. So there must be some other reason for his demagogic rantings and threats to deliver Mr. Harper "a big goose egg" of seats in Newfoundland in the next federal campaign. We suspect his theatrical fury is cover for his own recent disastrous mismanagement of his province's energy industry.
. . .
At his best, Mr. Williams is a charmer and a visionary. He seems genuinely committed to getting his province off the federal dole -- eventually. But at his worst -- such as when he is storming out of premiers' conferences and flying home to take down the Canadian flag from Newfoundland's House of Assembly --Mr. Williams' is a juvenile showman whose antics serve to cast his province as Canada's pouting brat. Newfoundland and Labrador deserves better.
It looks like Premier Williams' very public campaign against Canada's New Government has generated little sympathy for this province nationally. In fact, in many corners it's a wash at best.

Even worse, Premier Williams has squandered his national political capital and respect in a Quixotic attempt to take down a national government on an issue for which there is little natural sympathy for his position.

Premier Williams may not want to link his prior decisions on expenditures or policy, on potential offshore projects for example, but others do want to and they do. And he has no answer for that other than dissembling that he's making progress and he hopes for better in the future.

The problem with those who lose their balance is they are often in denial about it until they hit the ground. It's not falling that's hard, it's the stopping. There's an old saw about the guy who fell off the ten-story building. As he fell, people near the windows heard him say as he plummeted by, "So far so good."

Premier Williams is not the best judge of how this national campaign is going - the national audience is. At best the national audience is clearly hearing, "So far so good" and at worse he's already hit the ground.

The local audience is mixed but still overwhelmingly in the Premier's favour. But a lot of that support has been based on pure emotional response to the resonant message of "we are being shafted." Ultimately that message needs solid information and evidence as the foundation of the campaign otherwise that energy just dissipates.

Both the province and the federal government have avoided being pinned down on the equalization numbers preferring qualitative descriptions like "shafted" and "blessed".

But now thanks to Wade Locke of MUN, we have a much clearer idea of what the fight is over - the difference between $24.1 billion or $28.6 billion on a program which is already an improvement of $6 billion over what we were receiving before.

We'll see next week if, on this issue, the people of the province judge the program as a shaft or a blessing; the national audience have already rendered their decision.

Wednesday, April 04, 2007

Common property resource mythology

In today's Globe and Mail there is a fascinating column by Jeffery Simpson called Why this country believes its own fish story (subscription required).

In part he says:
In a country with the world's longest coastline, we have made a hash of too many fisheries. Instead of being the leader in intelligent fisheries policies, we cling to mythologies that, in turn, have led to bad practices that more sensible countries discard.

The most tenacious mythology, especially in Atlantic Canadian fishing communities, is that fisheries must be a "common property resource," owned by all through the government and therefore available to all.

The results of this mythology are everywhere apparent: The fishery is not an industry based on economic principles, but a mixture of some economics and various forms of welfare.

It doesn't have to be this way, and it isn't this way in Iceland*, New Zealand, Australia and parts of the United States. And it wouldn't be this way if Canadians followed these examples and were also inspired by the latest report from the U.S.-based organization Environmental Defence.

. . .

The conclusion: Ditch common property resource regimes and adopt what Environmental Defence calls a "catch share fishery," also called a "transferable quota system." (full report here)

. . .

Why is this system, which has revolutionized the fisheries of Iceland and New Zealand, so dreaded in Canada? The mythology of the common property resource is one reason, the system having been in place for so long. Another is that catch share tries to put the fishery on a sound economic basis. It provides stable, full-time employment, and, through its market principles, encourages the best fishing interests.

It does, therefore, lead to less part-time employment and some shrinkage of processing capacity in small communities. Since the fishery-cum-unemployment system in Canada is designed to maximize part-time employment, ostensibly to help fishing communities, the very economic soundness of catch share causes fright.

It caused fright in Iceland and New Zealand in the early years. There were problems in setting overall catch limits and allocating initial shares. But, eventually, the fisheries of both countries found strong economic foundations, and no one proposes going back -- back to where Canada is and for the most part has always been, gripped by one of its mythologies.
Both the federal and provincial, Liberal and Conservative party fisheries spokespeople on government and opposition sides subscribe to the fisheries as a common property resource. As long as they do, any and all fisheries "reforms" will be mere tinkering around the edges never avoiding the tragedy of the commons.

I'm sure if it wasn't for the equalization jihad gripping the province that this column would be the "they are bashing us again" story of the day.


It's interesting that abandoning the common property resource for the fisheries never seems to enter into the calculations of those who want us to emulate Iceland (more on that another time).

Hebron will get done: premier

It's worth checking out this story in the Telegram today. In it, Premier Williams works to dispel the view that Hebron will come in time and things are OK in the meantime. As an exercise in damage control, it's pretty superficial and falls back on hoary cliches, bombast and semi-facts to ward off public discussions he's keen on tamping down.

Let's look at what he says.

First, as I mentioned yesterday, government is quick to be vague about mysterious "ongoing talks". Formal talks closed a year ago amidst much public acrimony on the province's side and the partners have since been disinclined to carry on under the last set of conditions laid down by government. The Telegram reports:
Williams said Tuesday officials with his government and Newfoundland and Labrador Hydro are in discussions with partners in the project "all the time."

He wouldn't go into details of those discussions.
Interestingly, Premier Williams does not specifically claim that the discussions with the partners have anything to do with Hebron although he does try to leave that impression. In fact, both government and the Hebron partners (who are also the Hibernia and Terra Nova partners: ExxonMobile, PetroCan, Chevron et al) talk all the time over operational issues, Hibernia South and other non-Hebron projects without ever talking about Hebron itself.

So are there talks ongoing all the time about Hebron as the Premier wants people to believe?

The last time government tossed up these kind of vacuous and bland reassurances, media follow-up with the partners revealed that as far as they were concerned there were no kinds of discussions at all; while they were ready to reopen talks, they were very firm that there had been no talks on Hebron going forward since the break-down.

It would be interesting now to go back to the partners, present them with the Premier's quotes and and ask them about the status of Hebron negotiations. As long as the Premier refuses to go into details, he can be as vague and misleading as he wants and that's exactly where his interest lie.

Then there is William's hollow statement that the companies will come back and he notes:
"If we're naive enough to think they're going to walk away from us for 15 to 20 years, then I think we're making a mistake," Williams said.
It may be trite to say that when he calls that statement naive, he's being naive himself but it would still be true. The companies will stay around and maximize their investment in Hibernia South (currently held hostage by government) and White Rose because they can expand that production with little capital or engineering outlay.

But when it comes to a whole new project, especially one at the cutting edge of technology and the marginal end of the economic spectrum (Hebron only makes sense if prices stay very high), there are lots of projects in the world which involve lower capital outlay, more government predictability and higher returns.

In fact, there are more such projects in the world than the major oil companies have people and money to develop them. With 15-20 years considered near-term in the oil majors planning process, obstinance has costs to this province both real and opportunity.

On the matter of the lost jobs and lost opportunities, Premier Williams is caught in a bind. On one side, Hebron represents literally thousands of person-years of work all over the province and $10-12 billion in government revenues. Yet Williams tries to minimize the effects of not having the project through remarks like "St. John's can take the hit" or, as reported yesterday:
"If there doesn't happen to be a job for someone in St. John's in an engineering firm, that's unfortunate. I'm not happy with that. But there has to be some price paid in the short term," he said.
So how unhappy is he with that state of affairs? Clearly not sufficiently unhappy to actually open real talks and do anything about it.

The reality is that we are not talking about one engineer in St. John's, we are talking about hundreds of engineers and support staff in St. John's alone. We are talking about thousands of fabricators in Marytown and Bull Arm, a region that really needs the work. We are talking about uncounted people across the province suddenly getting busy with real and well-paying jobs here in this province instead of out there in Alberta*.

While Premier Williams cavalierly dismisses that one job in St. John's, he pointedly ignores the fact that the oil and oil-related business and associated jobs in the province is province-wide. The Hibernia platform alone, for example, employs people from 90 different communities across the province.

But the most disturbing thing about this story is how Premier Williams casually squanders the one-time limited resource that is oil revenues while proudly using government spending as a substitute for real economic development. Again, as reported in the Telegram:
He said those surpluses are being reinvested into the province's infrastructure.

While things may have slowed in the oil and gas industry, Williams said, paving companies, construction companies and education and health boards are benefitting.

"There's a lot of work going on around the province," he said.
More roads to maintain, more teachers and doctors on salary, and overall more money spent on just maintaining government operations by an administration who can boast a larger public service, in absolute and relative terms, today than when it took office.

At the same time the private sector is in retreat across the province with the latest reports showing that Newfoundland and Labrador will see a decline in private sector capital spending intention and an overall GDP dipping to the lowest in Canada in 2008.

It's the long term spending by private capital that will make the difference in ensuring that this province is a going concern over relating it to the status of a bedroom suburb of Fort McMurray.

And there is still no resource money allocated on an ongoing basis to lowering the provincial debt.

In this interview, Premier Williams is pandering to the 70% who continue to approve of his actions as long as they believe they are paying no cost for them. For the foreseeable future and into the next election, facts will play no role in this debate because of the way this province has divided into two camps.

There are those who don't know or care about the economic impact of this government's actions as long as they can bob along proudly in the glorious wake of Premier Williams' latest jihad.

And then there's those in the real world who have businesses to maintain, homes to keep up and children to feed. And those are the ones leaving for Alberta so they won't be voting anyway.


*And make no mistake - there is an exodus of trained and capable workers out of this province because there is no substantial work for them to do. Empty palliative government programs dealing with a skilled labour shortage cannot place of actually producing jobs to attract and keep those workers. You can put this program in the same bin as the provincial immigration strategy which will fail for the same reason government is ignoring: It's the economy, stupid.

Tuesday, April 03, 2007

Managing the Issue - Constituency Allowances

A month ago I argued here that the actions of this government, and the way they have handled the shenanigans of MHAs and their constituency allowances, suggest that the Williams government is far more concerned with managing the issue to this government's political benefit rather than trying to get to the bottom of things.

Now that position has been proven.

Tonight on CBC television, a report by David Cochrane includes an interview with the Auditor General John Noseworthy. Noseworthy reveals that the release of his next major report, due in September on the constituency allowance records of all current MHAs, has been changed.

It turns out that a month ago, somebody at the Premier's office asked that the AG put on a push to do a report covering all the MHAs since 1989 instead.


As Cochrane points out, if the report was to be compiled as originally tasked, the covered MHA would have been 2/3 tories. Now, going back to 1989, it will be 3/4 Liberals.

The goal is to dilute current shenanigans with historical shenanigans just before the provincial election.

Should the MHAs going back to 1989 be looked at? Yes they should.

But with the telephone call of a faceless staffer of the Premier's Office, they have proved beyond any reasonable doubt that the overall goal of these "investigations" is political manipulation with uncovering the truth a distant second priority.

So we still need a public inquiry so this matter can be taken out of these self-interested hands in the Premier's office. That hope grows fainter by the day.

Scotland and NL - Independent together

While nationalists have been using Iceland, Ireland and even Malta as possible models for an independent Newfoundland and Labrador, they seem to have missed Scotland.

Check this piece from the Financial Times of London. It provides an interesting perspective on the rise and effects of Scottish nationalism.

With passages like the following, it's pretty inflammatory and yet so, so familiar:
"Can Scotland expect a larger handout from the UK exchequer or international oil companies? This small-minded, grasping materialism is characteristic of much debate in the Scottish parliament and on the hustings. That attitude provides the strongest argument against Scottish independence."

Hebron - One year on

There have been a spate of stories centering on the the collapse of these important negotiations. Over the last few weeks, both CBC and the Telegram have been covering the effects of having no new oil projects on deck. And stirring thing up to a fever pitch was the Craig Wescott speech.

Interestingly, while everybody is talking about the effects of having no Hebron, as far as I can tell nobody has asked the Premier about the current state of negotiations.

In the days following the end of talks, Premier Williams floated vague balloons that talks were still ongoing with somebody, somewhere in some way. But while government could not confirm details that this was happening, industry was very quick to confirm that there were no talks ongoing at all anywhere with anybody.

And that's the way things seem to be today.

It's hard to negotiate and come to an agreement without actually talking although it seems industry has already moved on anyway. The fact that Premier Williams has been talking about every issue under the sun but this one leads me to suspect that he knows that too; he'd prefer everybody just forget anything like Hebron every existed.

I'll just close this matter with a link to Caught in the Middle, a piece I wrote published in Atlantic Business Magazine in the wake of collapse.

Old things new again

For those who had their political coming of age in the 1980's there is a certain nagging familiarity with current political events. You might remember a pundit named Babara Yaffe who was widely read at the time. In a Globe and Mail column on April 9, 1981, at another low point in the federal-provincial wars, she encapsulated the administration of Premier Brian A. Peckford at about the same point in his administration as Premier Williams is now.

The column opens with the paragraph:
The Newfoundland Government ought to set up a consulting services. The advertising promos might read: "Want to take on a province or other government jurisdiction? Call us for dynamite rhetoric and relentless service:" Alas, in small letters at the bottom of the page, would appear the following: "Satisfaction definitely not guaranteed."
It's worth reading to see how old things are new again.

Sunday, April 01, 2007

Happy Confederation Day

I would really like to do a long post on the whole issue of Newfoundland and Labrador's confederation with Canada but, to my great regret, this is not a day where I have the time to do that. Regular readers will know how much I would really want to but I'm afraid it will have to wait until next year.

Let it suffice for the moment to note the variety of posts on the subject by Ed at Bond Papers, Liam at Responsible Government, Greg at News from NL and Wally at Labradore here and here.

If nothing else, these posts and their associated comments show how federalists are diverse in their philosophical underpinnings and perspectives.

Even more, the posts show the wide variety of the nationalist streams ranging from the mild autonomists to outright separatists with their philosophies ranging from Libertarian to romantic communal pastoralist to radical and disturbed Red Army types (shudder).

Clearly this is a complex debate with many positions and passions at play.

The best part is that this debate can carry on without resorting too often to the rhetorical knife in the ribs (although that could improve) and never, so far, to literal guns and improvised explosive devices.

I only wish we could rely more on facts than the gut although without the gut, this debate would likely never take place at all.

But I do have to add this for myself: there is no doubt in my mind that confederation has been very good for this province and that both NL and Canada have done well by the relationship.

I see no conflict in the idea of a strong and proud NL within a united and powerful Canada and I would cheerfully hit the streets to prevent that relationship from ending.

Happy Confederation Day.