Friday, August 31, 2007

Gone fishing . . . for votes

As of noon today, I am the Liberal candidate for the provincial district of St. John's North.

I've never hidden my political affiliations or my past connections with prior governments. In fact, it was those affiliations which have taught me about how government works and how government should work.

The general view from the street is that government is a black box with mysterious inner workings. It's not obvious how and why some things get done but not others. And reading government statements and releases rarely tells you the reasons why.

For better or worse, those things tend to be pretty transparent to me. That's the advantage of having worked alongside the most senior government levels of this province on and off since 1989.

It was that that experience behind me that has allowed me to write on a whole host of issues both here and in commercial publications over the last couple of years.

Some of those writings have been considered sharply critical of some government actions.

Partially it's because the last few years has not convinced me that the direction this government has been taking the province is the right one.

More importantly, I am convinced that the way this government goes about it's business - secretive, arbitrary, high-handed, intolerant of dissent, endlessly combative with industry and Ottawa, quick to label as enemies those who question - is just wrong for a province of one of the most civilized countries in the world.

And I believe this government has taken St. John's for granted in almost every conceivable way.

I have not been shy about asking the hard questions I felt needed to be asked. I have even come under personal attack from some quarters for daring to ask. I'm sorry to say I don't think those attacks will go away. In fact, I expect them to intensify.

But I hope I can ask the questions that you would ask if you were in my place.

I have no illusions that this will be an easy campaign - I read numbers too. But the "best time to run" is only obvious in hindsight. At some point one has to put their name, time and energy where their mouth is so you can look at yourself in the mirror in the morning.

As in my municipal campaign 2 years ago, I have some personal goals: raise some issues, don't go into debt, keep my integrity and win. If I can do 3 of those 4 things I will be pretty happy with that.

I'll be happier with 4 of 4 but that's in the hands of the people of St. John's North. And the people are never wrong.

My campaign will discuss issues which face this province now and in the future. This will include a focus on matters like the economy; elder care and other social issues; and effective local representation.

Too many critical issue have been pushed off the public agenda; it's time for someone to bring them forward.

I will not throw mud. Frankly, there are enough issues out there that it would take me 5 campaigns before I ran out of sensible things to say. Dirty tactics and personal attacks are the last resort of scoundrels and fools with nothing sensible to say.

Finally, I never intended to use this blog as a political soapbox and I don't intend to now. OffalNews is an outlet for information, issues, insights and ideas and I want to keep it that way. So until October 9, I will not be adding any more posts here.

A link to my campaign site will be added when it goes live.

Take care and see you October 10.

Wednesday, August 29, 2007

Don't go back to sleep

A milestone of sorts was reached today: the first ever open and public meeting of the successor committee of the House of Assembly Internal Economies Commission (IEC).

Outside of a few House of Assembly wonks, nobody had ever heard of the IEC. It was the rare member of the public or even media could tell you what it was and what it did. And as hard as it is to believe, even most MHAs were largely ignorant of IEC operations.

But as the center of the House of Assembly spending scandals, the dispenser of secret $2800 payments to MHAs and the committee which set the rules (such as they were) which for years permitted MHAs spend public money for private political purposes it was a critical part of the legislative/political system.

Now everyone has heard of it.

When politicians tell you that open meetings of the IEC are the beginning of a new era and marks the end of the bad old ways, don't take that too seriously.

Remember that much of the spending shenanigans were not directed by the IEC in isolation and away from the light. Much of the mess was organized in close partnership with the full House of Assembly in open and free votes in front of media representatives and televised across the province.

And just when you thought we were out of the dark times and into the new era of accountability, openness and transparency, this government and the entire House in general lets us down.

It was only in the last few months that Minister Rideout proudly trumpeted new rules for MHA spending. Only after the fact did we realize we were hoodwinked and that no rules would be in place until after the election.

We were misled about what was happening through a series of amendments delaying implementation which threw up so much smoke and mirrors that even the media watching from the galleries had no idea what was happening. More than a few voting MHAs were taken by surprise when they were later advised of what they had voted for.

An open and televised vote in the House, observed by the media, fooled us all. What's the lesson to take from this? That just because the new IEC meetings are public does not eliminate the possibility that they can pull the wool over our eyes.

So when they tell you to go back to sleep and everything is OK, don't. It means we have to watch what they do and scrutinise them more closely than ever.

Tuesday, August 28, 2007

Into the breach!

As of today, I am a candidate for the Liberal nomination in the seat of St. John's North.

Looking out at the political and economic landscape, I've reached the point now where it's time to put my name, time and energy on the line. So I'm offering the people of St. John's North a fresh choice.

It's something that I've been considering for a while but it's events over the last few weeks that really clinched it for me. Between the secret Hebron MOU, the high-handed treatment of MUN and the ongoing negligence of important issues like elder care, I want to do what I can to contribute to the public debate.

Last night I sent out a release (see below) and I think it pretty well says it all for the moment. There has already been some media coverage at the Telegram. And I appreciate the kind thoughts of support and positive reception from the blogosphere from Ed at the Bond Papers and Greg Locke; it gives me hope.

I will try to post when I can but you can appreciate that it won't be as frequently as normal. In the meantime there will soon be a campaign website with more information as it comes together.


August 27, 2005

Simon Lono Declares for Liberals
in St. John’s North

Simon Lono today declared his candidacy for the Liberal Party nomination in the provincial district of St. John’s North.

"The people of St. John's North deserve strong, vigorous representation in the House of Assembly," said Lono. "They deserve more than the attitude that St. John's can take the hit in elder care, education and the economy."

This was not a decision taken lightly, Lono said. “It was not an easy choice; I have been thinking about this for a while. I’m running because I’m concerned about the direction the province going.”

“The Williams government has neglected important issues and has misplaced priorities,” said Lono. “They’ve taken no action to address the needs of our aging population. In education, they’ve decided to break up Memorial University without counting the cost to the public purse, the effect on post-secondary education or even if this is the best option for our students.

“As for the economy, we can’t be satisfied to accept mere crumbs of information on a project as important to our future as Hebron; we need more information than government has revealed so far, so we can judge for ourselves. Secret deals are not acceptable.”

Lono notes that it takes a strong representation to make the difference. “The people of St. John’s North have had no voice. We have too many silent, passive members sitting on the government side of the House,” he said. “This government has taken St. John’s North for granted and it shows.”

"Public service has always been important to me, and I know I can contribute energy and new ideas to this province as a member of the House of Assembly working for the people of St. John's North.”


Monday, August 20, 2007

MUN and Grenfell - To the Star!

I submitted this letter to the editor in response to this editorial ("Everyone is Having a Say") in the Western Star. No surprise they felt disinclined to publish it or even acknowledge receipt.

The Star's editorial staff are pretty keen and uncritical on the issues of goodies delivered by their MHAs. And that's fine for a small, local newspaper.

It turns out this letter was published. Oddly, they never called to confirm authorship and they don't have letters on their website so I had no idea.



In your haste to stamp approval on government’s Sir Wilfred Grenfell College (SWGC) “university” project, your editorial skipped over facts and has rewritten the history of recent events.

First, it’s clear that government and the political boss for the Corner Brook region, Tom Marshall, put the cart before the horse. Behind closed doors he and his colleagues commissioned a report with a mandate which predetermined a conclusion of Grenfell “autonomy”.

This conclusion was decided for political reasons in advance of any research, consultation or evidence.

Little wonder that the consultants, constrained by that requirement, we left with no choice but to look at issues of “how” and left out issues of “why”. The “why” was because government said so.

And no public debate was has been invited or encouraged since.

So to say now that everybody is having their say, as your editorial states, is disingenuous in the extreme. There was no public discussion or consultation with university stakeholders prior to government’s decision. Issues of educational appropriateness, academic effectiveness or effects on budgets or staffing are dismissed as irrelevant or inconvenient.

Education Minister Joan Burke accuses people with legitimate concerns of “sabotage”.

Please explain how that encourages public debate.

Meanwhile, government spokespersons dissemble and spin. Minister Marshall smooths over financial issues as insignificant while his own report says Grenfell will become the most expensive university in Canada. And his explanations of what autonomy means and how it will be executed wander all over the landscape.

Government talks about previous reports. They neglect to mention that they were all reviewed by skilled and experienced public servants who recommended in each and every case that structural SWGC autonomy was uncalled for. So while Premier Williams lauds the quality of “his” public service, he ignore their recommendations.

There are legitimate public policy concerns over this course of action: academic, financial, and institutional.

SWGC has established itself as key component to Memorial's reputation. It has earned its own reputation in various fields, sometimes with and at times without the full understanding of the Board of Regents. But even under government’s plan, the same Board of Regents will continue to oversee SWGC.

If there are organizational problems, then government and MUN should address those in an open, accountable and transparent manner. It should not manufacture decisions on dubious grounds behind closed doors.

Over what better issues than university education and academic freedom can we have an open, transparent and free public discussion?

All the work done by Memorial University, and that includes SWGC, over the last 50 years to place themselves in the top tier of post-secondary institutions is potentially jeopardized over this hasty and short-sighted decision.

Sure, everybody is having their say now, after the fact. It’s like everybody having their say about the open barn door after the horse is long gone; it doesn’t bring the horse back.

Friday, August 17, 2007

Look under the bed

There are no shortage of evil conspiracies out there if you are just willing to open your eyes and see. These theories have at their root the idea that some secret club or person or persons has far reaching enormous malevolent power over you or your society.

There's no evidence of it other than conjectures and speculation. The cases are circumstantial and laughably ridiculous at best. At worse, they poison public discussion and lead to paranoia.

One of my personal favourites is the Trilateral Commission - a supersecret regular meeting of high level public and privet figures who covertly rule the world (so secret they have a website, I notice)*. Another is the New World Order which aims to subvert national sovereignty in favour of UN rule.

A particularly nasty conspiracy theory centered around the Protocols of Zion, a set of forged proceedings which claimed the Jews were working to take over the world. Lots of people suffered at the hands of the fools who fell for that one.

On the local level there's the famous conspiracy among people unknown, for reasons undocumented, who subverted the 1948 NL referendums to force us into Canada. And you know it must be the case because they made a movie about it!

These are all about secret meetings, murky motives and things which must be true because the conspiracy seems to explain so many things. Take this breathless explanation and warning from WebTalk about the latest international conspiracy, the “Security and Prosperity Partnership” or SPP:
The SPP exists only as a verbal entity and is not found in any official treaty or identified in any government legislation. Instead SPP is based on private discussions between the leaders themselves and closed door meetings with big business, lobbyists and political insiders.

From the Canadian perspective, the SPP is a means of completely overhauling Canadian business, military and social programs without having to adhere to normal democratic processes or contend with unwanted public scrutiny.

Since none of what is discussed or agreed upon during SPP meetings is ever reflected in official documents the public has no idea what is being done behind the scenes and no opportunity to have a say in the nation’s future. A future which, if SPP proponents like Stephen Harper have their way, will see Canada suffer massive job losses and lead to the destruction of the of social programs and benefits we all depend on.
Hmm. No documentation or evidence, supersecret meetings, blanket denials, far reaching influence, dire consequences. Sounds like every other wingnut conspiracy throughout the ages.

I guess if you get sucked in by one conspiracy, you have to accept them all.


*At the risk of driving the local fruitloops into another lather, I actually know somebody who was a member of the commission and told me great stories about their sessions. He never let me in on their secret handshake. But he did tell me that virgin sacrifices were now restricted to only once at the beginning of each session and not at the end too as was their previous practice.

Blogs and libel

This came from CBC news.

Political blogging, in the end, is no different that any other kind of writing: responsibility must be taken.

A confession on stimulis and response, pokes and smears

There's an ancient principle of biology that goes back thousands of years - stimulus and response. The idea is simple - you learn about a biological system by providing a stimulus and then observing and measuring the response.

During the 1780's, biologist Luigi Galvani performed experiments at the University of Bologna involving electric charges and frogs. Charges could make frog legs jump even if the legs were no longer attached to a frog.

In neuroscience, a classic set of experiments provided fascinating results. They opened up the skull of a conscious subject and then probed the brain. The subject, in response to the probes, experienced smells, emotions and memories. Those results produced the first rough map of the brain function.

As with a frog leg or a brain, you can perform the same experiment on a body politic. Provide a stimulus, say a series of provocative blog posts or talk radio telephone calls, and check the response.

The results are complex. Depending on the region of the body politic observed, the response might be approval, agreement, delight. Other parts register disapproval, annoyance, anger.

And then there are those dank corners where the response is peculiar and disproportionate. It turns out that, on some topics, the response is more than mere disapproval. The response is paranoid, suspicious and irrationally hostile.

It's the response that tells you more about those rigid and claustrophobic corners than you ever wanted to know.

I must be in the secret pay of great forces, they muse. How else could a sole individual, on their own, dare to take on the powers that rule this province? I must be the tool of those who wish to do us harm. Why else stand before the tide?

Smears and sleazy, baseless questions about motivation come into the light. While speculation is offered, no evidence is provided or produced.

But of course, you don't need evidence to posit a conspiracy theory. That's what conspiracy theories are all about. It's the arched eyebrow, the knowing nod and the open-ended question that condemns through quiet implication. Evidence, sense, facts have no place in the conspiracy theory.

Now here's the confession part of this post: I poke.

When I see an issue where foolishness reigns, I poke hard to knock in some sense. When I see smoke and mirrors, I poke to dissipate the fog and break the mirrors. When I see darkness, I poke to let the light in.

And when somebody pokes me, I poke back. I can't help it.

I've spent most of my life studying, formally and informally, the objective underlying causes of public issues facing this city, province and country. I've studied and considered where they come from, how they come to be and what can be done about them with rational public policy. And I've studied and practiced how to communicate those things to others.

Some people like that about me and encourage me. I thank them.

Some people don't like it and prefer I just keep quiet. Go along to get along, they say, and come with us on the most-traveled path.

But I'm not good at checking my brain in at the door and letting others think on my behalf.

One thing for sure, one can't be all things to all people all the time so I don't even try. Besides being somebody that I'm not, I just can't maintain that kind of empty facade.

I got to be me.

And I want to make this province and people the very best, most successful and happiest we can be.

The fact is that I do what I do, write what I write, say what I say based on my own knowledge, my own experience, my own ideals. And I have no problem associating my name and face with that.

My views and opinions are not available for sale, rent or even a short term lease. If they were, I'm sure some of those I've irritated with inconvenient facts and would cheerfully cut me a cheque at the drop of a hat just to get me out of their hair.

So when you see the low reflexive response of paranoia to my political stimulus, recognise it for what it is: it's not a conspiracy.

It's a frog leg jumping in a dish.


UPDATE: If all it takes is a blog post of denial to generate the withdrawal of a smear, it might be worthwhile to substitute research and thought in place of idle, baseless speculation.

Thursday, August 16, 2007

Grenfell - another voice chimes in

Thoughts from the Western Edge, a MUN graduate who also graduated from mainland universities, has a thought on the plan to break off Grenfell. It's worth the read.

With a title like Silly Education Ideas, he telegraphs his message right up front. He concludes:
Establishing Grenfell as a university will present an option to young students which will be misleading. They will see the title 'university' and think that they are being offered a program that is on par with other univeristies when it patently will not be. What they will be offered (except possibly in certain narrow specialty areas such as fine arts) is a community college experience in a college that will face severe economic challenges as well as severe reputational challenges. A wise government would recognize that this idea will do nothing to further the future of Grenfell, Memorial or the students of Newfoundland.

Wednesday, August 15, 2007

Grenfell most expensive

CBC news last night pointed out that Grenfell University, if government has it's way, would be the most expensive university on a per-student basis in the country.

They note that:
Grenfell costs nearly $11,000 per student to operate each year. When it splits from Memorial, that cost will jump to between $12,000 and $14,000 per student, surpassing Canada's current most expensive school, Mount Alison University in New Brunswick, the report said.
But no price is too high to satisfy the needs and wants of regional political bosses. If only the rest of us, and particularly the students of the province, didn't have to pay for this damage to our valuable educational institutions.

Tuesday, August 14, 2007

How times have changed

PREMIER WILLIAMS: Mr. Speaker, I respect freedom of the press, and I respect the opinions of any columnist who sees fit to write and express an opinion on anything that we are doing.

May 11, 2005.

Big News at WebTalk

Over at WebTalk, they have definitively determined through objective reasoning and careful analysis that Canada is a failure as a nation and that NL would be much better off on it's own.

Actually, that's not news at all - it's just same old same old negative chauvinistic propaganda as they have all the time. (*yawn*)

But here's something really different: their comments section provides bright, witty and insightful rejoinders and contributions complete with facts and evidence and wholly lacking in crude and vulgar infantile ad hominem attacks on those with a differing point of view.

Actually, that's not true at all. But if it were, it would be news!

(Don't hold your breath.)

Outsourcing media: take II

Bond Papers raises the issue of media outlets outsourcing copy editing to India. That's not uncommon in the publishing industry. Many academic books have their editing outsourced to India. The rates are very low and the standard of English is very high.

But, in the end, that's just taking existing content and processing it to a certain standard. It's not actually creating or originating copy.

Then there's the case of Pasadena Now, a website devoted to the events of Pasadena, California. Their reporters cover the city council the modern way - each week they watch the webcast then follow up by making calls and do telephone interviews and write the story and file it with the editor.

All from India, as this story reports. It notes that:
When he had the brainstorm to use journalists in India, he was able to hire two for a total of $20,800. Not only is that within his budget, he says it is "apparently" a pretty good salary in Mumbai and Bangalore, where the two reporters live.

While outraged at the idea of covering stories from halfway around the world, journalists say this is far from an isolated trend.

Shhhhhhhhh. . . don't tell Transcontinental.

Monday, August 13, 2007

Separation makes no sense

This was published today in the Telegram as a forum piece.


Government decided behind closed doors to give Grenfell College more autonomy from Memorial University. That decision was made without a plan or detailed consideration of the costs and disadvantages.

The cart was put before the horse when consultants were mandated to explore Grenfell’s autonomy. Deliberately left out was an exploration of why it should be autonomous or if it should be autonomous.

Those questions were already answered by the dynamics of the October provincial election and the need for simple pork politics.

Autonomy defenders, talking up regional pride and the no-cost virtues of autonomy, see no disadvantages. They meet critics with disdain and dismissal at best. At worse, they attack then as saboteurs.

But the report, when separated from political bombast, gives a very good outline of what we might to expect from government’s unilateral move.

On page 9, three main disadvantages to government’s chosen option are outlined by the consultants.

First they expect “substantial additional costs”. There are no hard estimates based on organisational change reviews - they’re just guesses. Separately reported estimates range up to $15-20million per year. Right now, they don’t know what jobs, employees, functions and/or divisions will be shifted across the province. Or in what direction. Or if they will be shared or duplicated. So government can’t begin to predict the costs.

Second, the consultants say an autonomous Grenfell will only be able to offer a “limited academic programme range.” Small student numbers will guarantee that. MUN has economies of scale to offer a range of programs proportionally much greater than smaller universities. So don’t expect too many new programs. In a vicious cycle, limited program range discourages future student interest, too.

Third, the consultants point to “fragmentation of academic authority and divergence in academic standards and practice.” Setting up separate academic senates, as per government’s goal, will ensure the two institutions grow more academically incompatible over time. Students, credits, courses and programs will become harder to transfer. Right now, those transfers are seamless.

Government spokespersons deny this point. But government can’t give Grenfell academic autonomy and then tell them not to use it.

To this weakening of Grenfell as an academic institution, the consultants advocate a magic solution - doubling the student body in ten years. Grenfell currently has roughly 1300 students. To be feasible as an autonomous university, according to the consultants, Grenfell has to grow to 2500 students in ten years.

But there is no hint how to do this or how much it will cost. The province in general, and the west coast in particular, produces fewer and fewer university aged persons each year. That’s the situation across the rest of Canada too.

There are no signs that will change. It’s the hard truth of modern demographics.

While the international market sounds like an attractive and easy source, realistically international students will only ever form a very small proportion of Grenfell students. It will never be half.

Is the best way to spend public money on post-secondary education?

We have no shortage of university graduates in the province. It’s the shortage in skills and trades of all kinds that impedes our progress. Any survey of employers in the province says we need workers with trades and skills, not more university graduates.

This decision is shortsighted. It damages respected institutions and does not solve problems we need to address. Even worse, it treats Memorial University as spoils for distribution to regional political bosses.

Real Leadership indeed.

Sunday, August 12, 2007

Is that a change in the wind?

Up till now Premier Williams has insisted that the province has not shifted it's "position" on Hebron. In fact, Williams says the province has stood fast and hasn't shifted at all.

But over the last few days, the language has subtly changed. Today, CTV and VOCM both report his new language as Williams saying that he hasn't budged from its "basic principles.''

Before, Williams says he wasn't going to shift from his "position". Now he's working to preserve his "basic principles".

On the face of it, a "position" is more fixed than "basic principles".

On the other hand, this might be reading more into hastily edited news stories and snap political reactions than is prudent.

Saturday, August 11, 2007

What goes up must come down

The Telegram column today from Bill Rowe is worth reading. He makes the general argument from recent political history that political parties hit their lowest lows after reaching the highest highs.

For example, after the federal PCs knocking off the biggest majority in Canadian history, they were virtually wiped out just a couple of elections later. He points out the instructive case of the Smallwood Liberals too.

He writes:
There’s an unrestrained impulse among many involved in that all-consuming racket for overwhelming success. Success in moderation is not sufficient. It has to be absolute, over-the-top success even though such total triumph often carries with it the seeds of its own destruction ...

I’m not saying he will destroy his party as Mulroney did. But he could well push his party into the outer darkness for a couple of decades as Joey did. So, while he drives towards massive victory in October, Danny might well remember that leaders as lovable and powerful as he now is, incredible as that now seems, sowed the seeds of ruin by their overweening success.

Is that kind of political devastation a truism? Or is it the selective application of post-facto moral approbation?

Or is Rowe on to something?

The pattern is more subtle than just a party going from great heights to great lows. I think the pattern is closely related to the leadership which took them to the great heights achieved. The difference between the phenomena Rowe talks about and the normal exchange of parties in government comes down to an important factor: the leader style.

There are some successful parties where the success is institutional and party-based. Their leaders are not central of the party's identity and function. The strings of Alberta and Ontario Progressive Conservative dynastic governments provide the answer.

In both cases, the parties were able to select leader after leader who could take over the party and continue an unbroken string of electoral and government success. The successful elements which led them to multiple election wins under multiple leaders were centered in the party. Those parties had the ability to successfully self-renew their leadership without the trauma of electoral loss to force the issue.

The parties remained effective under multiple leaders through continuity of their structures and activists.

Mind you most of those leaders seemed pretty conventional with some exceptions, but that's part of the pattern too. These fairly conventional leaders left the issue of electoral success devolved to the party mechanism without needing to take it into their own hands. That way, the tools were in place for the next leader when they came along.

You would think that's the norm but it's not. When Turner came to power in 1984, he found the federal Liberal Party had virtually hollowed out. The reelection structures had settled do firmly in the Office of the Prime Minister that when Trudeau left, no reelection machine existed.

Under Smallwood, Smallwood was the party in every meaningful sense. Maurice Duplessis comes to mind too.

Under Mulroney, the PC machinery was so closely tied to Mulroney that, just like the Trudeau Liberals, when he retired so did they. Did you see any significant Mulroney era fixers on the Kim Campbell campaign?

So when you have an overwhelming personality occupying the top post, they, well, overwhelm the top post and the party they lead. More and more the independent party structures are populated by persons more loyal to leader than the party. And they operate less and less independently from the leader's office.

You will see the reelection machinery and the leader's office become one and the same.

So when the leader leaves, the machinery collapse because the focus is gone. In some cases in might take a decade or more but it can just as easily take just a term or two.

Strong leaders tend to crowd out strong party mechanisms. In this province, with the popular emphasis on personality over party of ideology, the leaders matter even more than in most places and the parties matter less except as tools of the leader.

Do you think this current Premier doesn't thoroughly and completely dominate his party, caucus and government? Just ask Fabian Manning or Elizabeth Marshall.

It's too simplistic to say these structural reasons are the only ones why the strong personalities leave political devastation in their wake. Sometimes, after a few years of the electorate having to submit to the intensity and heat of "strong leadership", people just want a break. Look at Moores after Smallwood and Wells after Peckford. So there are other factors that come into play too.

But overall, I have to say that Bill Rowe has pretty well nailed it.

Miscellaneous Friday notes

Two posts on other blogs worth looking at . . .

Thoughts From the Western Edge has this look at Quebec's spending power given the recent House of Commons formal recognition of Quebec as a nation inside of Canada.

And you thought it was just a symbolic resolution with no force or meaning? Or did the resolution rock your nationalist world? As far as Robert is concerned, constitutionally this "recognition":
... is really theatre for the Quebec audience only as the various parties try to position themselves on the Plains of Abraham to best re-enact the version where Wolfe if killed and Montcalm triumphs. Quebeckers recognize this for what it is and given their increasingly sophisticated view of the world will watch the politicians go through their paces on this issue but judge them on things like the economy, labour peace and public services.
In the meantime and on a lighter note, (serious business) looks into the future and sees the Williams government treating offshore oil development as a serious public policy issue and not, as some have charged, as a tool to be used towards the end of political hegemony.

From the sublime to the ridiculous, OffalNews brings it all to you.

Friday, August 10, 2007

Premiers come up empty

Bond Papers wonders why the Council of the Federation (COF) worked out an energy plan faster than this province has been able to.

In fairness, and without seeing what kind of energy plan the Williams government plans to spring on us just as the election opens, the COF effort sounds like a surreal pile of junk. At least that's what this observer concludes.

It doesn't take long to produce junk.*

The premiers agree to disagree and then ask the feds for money. Same old same old. Thank God this body doesn't run the country.


*Of course, a long gestation is not necessarily any assurance of quality either.

Hebron talks on?

This from the CP wire service:

Formal talks to develop Hebron offshore oil project back on, N.L. gov't says

ST. JOHN'S, N.L. (CP) - The Newfoundland and Labrador government says formal negotiations to develop the stalled Hebron offshore oil project have resumed.

A spokeswoman for Premier Danny Williams says formal discussions to proceed with the multibillion-dollar oilfield are back on, but declined to elaborate further.

Two months ago, Williams announced that exploratory talks between the provincial government and Hebron's partners, including Petro-Canada (TSX:PCA), were ongoing, marking a significant change in tone for the premier.

Negotiations broke down last year after Williams insisted on a 4.9 per cent equity stake in the proposed offshore oilfield.

Chevron Canada Ltd., the operator of the Hebron offshore oil platform, disbanded its project team in April 2006 after the province and an oil consortium couldn't reach an agreement on financial terms and benefits.

Experts have estimated that Hebron could produce more revenue for the province than all of its three other current offshore projects combined.
According to some reports, he even dashed out of the Premier's conference to go negotiate directly. And with the election just two months away, juts in the nick of time, I'd say.

But in time for what? Another negotiation collapse followed by an election centered around another jihad against "big oil" and seeking a popular mandate to negotiate? Or will there be a deal completed in the heat of a pre-election urgency so government can point to a concrete and significant economic achievement?

Stay tuned.

Thursday, August 09, 2007

Enough said. . . .

From today's Telegram editorial page (Put Another Blog on the Fire). It says, in part:
New York newspaper columnist Murray Kempton once famously, and aptly, said "the function of an editorial writer is to come down out of the hills after the battle is over and shoot the wounded."

Well, if that's true, then Internet bloggers are the partisans who stay safely in the hills and indiscriminately mortar the ambulances. And the key word in that sentence is "partisan."


There has been some recent commentary in the media suggesting that we should all be looking for something deeper: that some political bloggers in this province have ties to the communications industry and might be secretly working for their clients' good. Nice, if you're into conspiracy theory already, but a bit out to lunch.

The fact is that bloggers answer to no one - to the point that some blogs don't even allow anyone aggrieved by the comments to post a reply - so, in some ways, they are like St. John's Mayor Andy Wells, but with a keyboard. Anyone who would use them to push nefarious corporate ends would have to have the skills of Svengali.
I could not have said it better myself.

Wednesday, August 08, 2007

John strikes back

John Crosbie continues to defend MUN in the Telegram and Western Star against the recent Grenfell autonomy decision of government.

He writes, in part:
The issue now is whether Grenfell does become an independent second university in Newfoundland and Labrador or whether Option 1(a) is adopted so that Grenfell becomes a second independent university but disguised as part of a single Memorial University system where Grenfell would have university status with a separate and independent president, executive, Senate and budget but sharing a common Board of Regents with the present MUN.

The Regents and I believe this is unworkable and undesirable and most damaging to the future of MUN. It is an arrangement that would make it impossible to manage and administer the affairs of this so-called university system and MUN without constant political interference and constant continuing battles as to how the resources of MUN are to be divided in future between Grenfell and the rest of the principal entities of MUN, including the Marine Institute.

The board and I do not believe that following Option 1(a) is in the best interest of any part of this province or any of its citizens. I am disappointed to see the premier attempt to justify what he proposes by suggesting that this is an example of the fact that "decisions should be made outside the overpass".

The overpass has no bearing on this issue and it is an attempt to obscure what is happening through political sloganeering. When I was in political life my decisions had nothing whatsoever to do with the overpass or where it was located, both as a federal and a provincial minister, but were guided by what I hope was in the best interest of every part of the province and all of the people who live therein.

Tuesday, August 07, 2007

New record time set

The last few days have seen new heights in petty political lows between Premier Williams and Prime Minister Harper over Harper's nickel tour of great NL disaster areas.

And so when you see something like this in the national media, you have to wonder what is going on: the Globe and Mail today reported that Canada's premiers have decided they're not going to discuss equalization payments when they gather for their annual gabfest this week in Moncton.

It goes on to note that:
Newfoundland's Danny Williams, whose 12 months as chairman of the Council of the Federation began with the collapse of equalization talks, is one of those who see a new era. "There's a mood in that room to move to a higher level and not to be seen as a group of premiers that come together to bash the federal government," he said.
Peace has broken out overnight, it seems.

But that was written yesterday and a lot can happen in politics in a day.

VOCM today reports that the federal-provincial wars are as hot as ever in reporting:
Williams Not in Tory Corner
August 7, 2007

Premier Danny Williams isn't budging from his position that people should vote 'Anybody But Conservative' in the next federal election. Williams says he wished Judy Foote well while visiting the south coast over the weekend. Foote won the Liberal nomination last week in the federal riding of Random-Burin-St. George's.
That seems to be a new time record in political shifts - from war to peace and back to war again in 24 hours. How did that happen? A short list of possible answers:
  • Premier Williams tells one story to national media ("I'm a good guy") and another to local media ("The feds are evil").
  • The local reporter misquoted.
  • The national reporter misquoted.
  • Premier Williams is an erratic unstable mercurial personality.
I wonder which one it is?

Monday, August 06, 2007

$38billion week in the oilpatch

Last week I posted about the $10billion day in the Alberta oilpatch. A pretty remarkably day, all in all.

That is, until you step back and realize that the $10billion day was part of a larger $38billion week according to this Globe and Mail article.

That's more money moving in one week than the NL government will see in revenues from Hibernia, White Rose, Terra Nova and Hebron over their entire project lives *combined*.

And it's not like last week was an unchracteristic peak. There are no signs of decline and, in fact, there will be more peaks to come.

It all kind of makes you wonder when our government will cease the ego-driven hostilities with big oil and just get on with it.

For the sake of posterity, the article is reprinted below.


Slew of deals shows oil sands fever not breaking
In spite of increasing construction costs, $38-billion worth of agreements and development plans announced last week

Canadian Press; Reuters, August 6, 2007

CALGARY -- The bout of oil sands fever sweeping through northern Alberta shows no sign of slowing down.

An eye-popping $38-billion in deals and development plans announced last week show skyrocketing construction costs haven't dampened interest, only that those intrigued have a blueprint for mining and refining the buried energy treasure.

"The size of the prize is very large, so everybody is going hell bent for leather," said Martin Molyneaux, managing director of institutional research with FirstEnergy Capital.

Shell Canada's plan to spend up to $27-billion on Canada's biggest oil sands upgrader, the $6.6-billion friendly takeover bid for Western Oil Sands Inc. by U.S. refiner Marathon Oil Corp., and a $4.4-billion regulatory strategy filed by Suncor Energy for the mining plan of its Voyageur South site all indicate the need to ensure a smooth development path for the tar-like bitumen.

"Securing that midstream upgrading and the downstream refining solution is going to be a challenge that all producers in the oil sands are going to have to overcome," said oil and gas analyst Chris Feltin with Tristone Capital.

"Those that can are going to be able to continue with their development strategy - potentially benefiting from better costs, but I think the key is being able to integrate those strategies," he said. "It's one thing to have these oil sands assets, but it's really important for these developers to have downstream solutions to handle the crude they produce."

Suncor's Voyageur expansion adds the basis to take the company beyond its goal of 550,000 barrels a day by 2012. A cost estimate of upgrading plans and details of the operation's scope and projected capability, is expected to be filed later this fall, but that will likely be in the range of $7-billion to $8-billion.

"This sets the stage for beyond 2012," Mr. Molyneaux said. "It's all about redeploying your cash flow, and the amount of cash you have once you get up to 500,000 barrels a day is enormous."

Suncor has a reputation as the best in the business for keeping oil sands projects on budget.

"It's the surprises that cost you in the oil sands," Mr. Molyneaux said.

Still, adding these extra megaprojects with aggressive timelines to the already overheated Alberta construction plate is sure to push escalating costs even higher.

Alberta has been crying for skilled workers for more than a year to cope with a staggering crush of infrastructure and energy development. Demand for oil sands labour is forecast to rise from 15,000 today to 34,000 by 2010 and that was before the Shell and Suncor plans were announced.

"There are a lot of issues with going that fast," said Justin Bouchard of Raymond James. "You've seen capital costs double or triple in the last six years and a lot of that is the overall boom in the energy sector."

That in turn is pushing margins to what could be an economic wall. When the $14.1-billion first stage of the Fort Hills oil sands development was announced in June, Petro-Canada and its partners projected a rate of return under 10 per cent.

"That's pretty skinny economics," Mr. Bouchard said. "If the continued pace of development causes increased capital costs, if there are more strikes, there will definitely be a point where some players will be delaying projects because it makes no sense to build it now."

That has already happened.

Canadian Natural Resources Ltd. has put its Wolf Lake upgrader on hold, while Synenco Energy Inc. sought "strategic repositioning" and is up for sale after costs of its Northern Lights project ballooned to $10.7-billion.

Alberta Premier Ed Stelmach has signalled he won't change the province's business-knows-best mantra and will impose no regulatory brakes to slow down screaming activity levels. And while an Aug. 1 report from the Conference Board of Canada said labour and material shortages in Alberta were pushing costs of new energy projects to near prohibitive levels, it's becoming clear that the new playing field means it's only who can absorb those long-term costs who can see development through to the payoff.

That means an increased presence of global players such as Royal Dutch Shell PLC, which takes control of Shell Canada on Sept. 4, or European integrated giant Total SA, which has been looking to solidify its place in the oil sands. Both could place a rival bid for Western Oil Sands.


Fat wallets and limited opportunities elsewhere may continue to push acquisitions in the oil sands, analysts say, though soaring costs may leave the sector open to only the very biggest companies.

"There isn't much left there for assets," says Kyle Preston, an analyst with Salman Partners.

The massive scale needed to justify an investment in the region means the next wave of buyers of oil sands assets may be large, integrated oil and gas companies, energy bankers said.

With deep pockets and easy access to low-cost capital, the biggest firms are best able to handle the high costs of construction, operations and labour in the region, the bankers said, but they will have to get past some roadblocks.

Finding large, high-quality assets may be difficult because many, such as the Shell-operated Athabasca project in which Western has a 20-per-cent stake, are already controlled and operated by the large integrated companies.

"I think people have pored over the region pretty extensively," one energy banker said.

Valuations are high and the biggest players - like No. 2 producer Suncor Energy Inc., with a stock-market value of more than $44-billion - are likely too expensive for all but the biggest companies to acquire. But while a big-ticket deal is considered unlikely, it's not out of the question.

"Anything can be sold," said Mark Friesen, an analyst with Calgary-based FirstEnergy Capital.


Friday, August 03, 2007

Iceland - Teetering on the brink?

A recent economic paper (“The Global Financial Accelerator and the Role of International Credit Agencies” by Carsten Valgreen, Chief Economist, Danske Bank) asks whether central banks of small countries are losing influence over macro economic policy. By losing influence, he means lack of impact in mitigating climbing interest rates and out-of-whack budgets.

The question he asks is Why hasn't the international market stepped in to rein in these imbalances?

The examples he uses are Iceland and Latvia. Let's talk about the conditions in Iceland since that country is this provincial government's nation-model-hero of the hour.

(Sounds like fun, I know but bear with me for a second - it's relevant.)

The fact is that Iceland is barely escaping the kind of currency crisis that a more vigilant bond market would traditionally have imposed just a few years ago.

Iceland has racked up enormous current-account deficits, running at a remarkable 25-30% of GDP.

NL, by comparison, is running substantial current account surpluses thanks to healthy oil and nickel revenues.

Iceland's companies have been in an acquisitive mood in recent years, borrowing heavily to buy abroad. The country has also used foreign finance to build some large aluminum smelters. As a result, its gross foreign debt is more than five times the value of its GDP.

The GDP is approximately US$16billion which makes the foreign debt about US$80billion. That's US$260,000 per capita.

Our debt? Well, these days it's running about $10billion compared to a GDP of about $19billion* for a ratio of roughly 50% of GDP. And it's already the highest per capita in Canada at roughly C$18,400 per person.

The Central Bank of Iceland has been trying to bring this issue of national debt under control by raising short-term interest rates to nearly 15%. This compares to a local interest rate of 6.5% or so.

Interestingly, the bank's efforts have, if anything, backfired. High rates have made Iceland the beneficiary of the “carry trade”, where investors borrow in a low-yielding currency and invest the proceeds in a higher-yielding one. The conventional wisdom is that high interest rates will be offset by an eventual plunge in the value of its currency.

But that hasn't happened. Iceland now has the worse of all worlds - simultaneous high interest rates and high currency.

So Iceland is now boxed into a situation where they have a debt that is crippling and unsustainable, interest rates that are more than twice of ours and an overvalued currency that's waiting for a collapse back down to more sensible levels.

Sure, let's emulate them because that's the economic model we want to follow.


* Our debt would actually be higher than that is we included our share of the federal debt but we'll leave that out for purposes of this discussion.

Thursday, August 02, 2007

Harper, the Wheat Board and the Federal Court

Thoughts from the Western Edge has a post on the Federal Court of Canada. Their recent decision that stopped Prime Minister's Harper's plan to gut the Wheat Board monopoly on barley shows the court is more independent than popularly believed.


Wednesday, August 01, 2007

Oil patch news

Today's Globe and Mail has two stories on big money moves in the oil sands.

Marathon Oil Corp. (NYSE:MRO) announced a deal yesterday to buy Calgary-based Western Oil Sands Inc. (TSX: WTO)for $5.84-billion. Marathon, the fourth-largest U.S.-based integrated oil and gas company and the fifth-largest U.S. refiner, sees the oil sands as a natural future source of crude for its refineries.

Meanwhile, Suncor Energy Inc. (TSX:SU) has filed an application with regulators yesterday to build an expansion to its mining operations in northern Alberta that could cost $4.4-billion. The proposed Voyageur South mine would increase its crude output to 550,000 barrels a day by 2012 and possibly change the way that bitumen is mined from the oil sands. The new project is expected to utilize mobile ore preparation equipment, instead of current truck and shovel systems, an advance that could reduce noise pollution, air emissions and require fewer workers.

All in all, a $10 billlion day.

We need some of those around here.

Remittances: Home and abroad

A good friend sent this along from the ITAR-TASS news service:
Moldova ranks world’s second by migrants’ money transfers
31.07.2007, 20.55

CHISINAU, July 31 (Itar-Tass) -- Moldovan labor migrants annually send $854 million to their families in the homeland, which makes up 27% of Moldova’s GDP, says a report entitled “Moldova – Migration Problems.”

Moldova ranks the world’s second after the African state of Togo by that parameter, the report runs.

The share of money transfers from abroad in the Moldovan GDP has grown from 8% to 27% over the past seven years.

In the opinion of experts of the International Monetary Fund (IMF), the amount of money transfers by labor migrants will continue to grow and reach $1.4 billion by 2008.

About 500,000 Moldovan citizens (nearly one-third of able-bodied people) have had to seek employment abroad. Fifty-seven percent of the labor migrants are working in Russia. The rest have found jobs in Italy, Portugal, Greece and other European countries.
I have already noted the issue of parts of this province's economy being kept afloat by remittances. The Stephenville area, and I suspect large parts of the Burin peninsula, would have families in true dire straits if it were not for the money sent home by their men working out west.

And there still seems to be no research into the scale and impact of these money flows. I guess there are no votes in that kind of expense.

Greenland oil profits stay in Greenland

This report from the The Copenhagen Post via the Denmark Ministry of Foreign Affairs reports that Greenland-Danish Autonomy Commission has recommended that Greenland should be granted the sole right to manage and sell potential oil reserves. This is another step in their process towards a Greenland Home Rule Act due in September.

Greenland, similar ethnographically to Nunavut, has sort of a territorial-like status within Denmark. It's in transition to becoming a self-governing nation in the Danish kingdom.

The commission has determined that all expenses incurred while conducting exploration for oil and income gained from the oil will go solely to Greenland.

They will not only be the primary beneficiary of this resource, they will be the only beneficiary of this resource.

Greenland receives from Denmark a kind of equalization-like annual block grant of DKK 3 billion (EUR 403 million) each year. That grant will be reduced by the amount of income taken in from future oil sales, but Greenland will still be entitled to at least DKK 75 million per year, according to the recommendation.

So much for exclusion of non-renewable natural resources in equalization. But you see no political jihads, no battles, no wars, no cries of separation - the Greenlanders see that option as sensible and reasonable.

For posterity, here is the full text


Income from potential oil deposits beneath Greenland are likely remain on the island

Greenland should be granted the sole right to manage and sell potential oil reserves, the Greenland-Danish Autonomy Commission recommended Wednesday.

The area in question is currently under joint Danish-Greenlandic control, but the commission - which will include the decision in its proposal for Greenland’s Home Rule Act in September - determined that all expenses incurred while conducting exploration for oil and income gained from the oil will go solely to Greenland, a self-governing nation in the Danish kingdom.

Denmark currently provides Greenland with a DKK 3 billion (EUR 403 million) annual block grant. That money will be subtracted from the income taken in from future oil sales, but Greenland will still be entitled to at least DKK 75 million per year, according to the recommendation.

Independent researchers as well as major oil companies have been conducting studies off Greenland’s west coast. Their findings indicate that up to 110 billion tons of oil could lie there - nearly 73 times more than Denmark’s North Sea oil reserves.

Lars-Emil Johansen, a Danish MP and Greenland’s former finance minister, said he was satisfied with the agreement.

‘It isn’t a goal for Greenland to continue to receive the block grant,’ he told financial daily Børsen. ‘We’re interested in a model where we gradually decrease the size of the grant as Greenland’s income from the oil increases - without it negatively affecting Greenlanders’ standard of living.’

There are currently eight oil research areas off Greenland’s west coast, but several other areas within Greenland’s territory have also been identified as potential oil reserves.

The Home Rule government has already received exploration applications from Exxon, Chevron, Husky and Denmark’s own Dong Energy.

The commission’s proposal is expected to be put into effect by June 2009.