Great expectations

It's in full bloom already.

Just when government has decided to settle in and coast, the demands and expectation for action become more clamorous.

In Labrador, CBC explicitly reports the heightened expectations by the people there. They see two members in cabinet (2/3 of the PC MHAs in the region) and they want results.

The Kruger paper mill in Corner Brook announced the shutdown of a machine and the displaced worker and their union were quick off the mark; they wanted government action and, in particular, action from their MHA (Premier Williams) but he happened to be off on holidays. Still, they insisted and moved up the political food chain and after their meeting with Minister Dunderdale finally received the Premier's personal attention.

Now Williams has vowed to "step up to the plate" after unions officials expressed impatience with the Premier's delay in stepping to it in the first place. The workers has received no satisfaction yet but that might change.

On the heels of those vents we see this: the fish plant in Trouty has closed putting 200 people out of work and they want government action too. They have set up a Facebook page, Save Outport Newfoundland and Labrador, which says in part:

What is the government doing? We elected this party into power with record-breaking results (%70) and the Minister of Fisheries was asked to discuss the matter by CBC today, and what do you think he did? Did he say "sure, let's talk about it!"

Nope.

He declined the interview.

Please let him know that with a 70% approval rating and billions of dollars in oil money, this province needs its historical outports to be brought back to life. Let this Government know we want a solution. And without a single meeting in the house this fall, this will give them time to think.

It turns out that the 70% vote not only gives government wide license to take innovative and independent actions, a choice largely forgone, it also gives the electorate a wide license to demand prompt and effective attention to the problems which plague them.

And so Premier Williams and his government learns a harsh lesson: If you want unconditional love, stay out of politics and get a dog instead.

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.

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 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.

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*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.

Equalization - Much ado about nothing?

In this article from the venerable StarPhoenix, Lorne Calvert indicates that he's hopeful that a solution to this matter of the Sask/NL Equalization war with Ottawa.

The story says:

After an interview on Wednesday in which Prime Minister Stephen Harper hinted he would live up to his election campaign guarantee to take non-renewable resources out of the federal equalization equation, Calvert was cautiously optimistic his own message on the matter was getting through.

It makes you wonder what kind of tempest in a teapot this whole thing was in the first place.

If you recall, this war started when Harper refused to give iron-clad assurances to Premier Williams at the PC Party convention in Gander. Little wonder Harper was disinclined to cooperate given the shabby treatment Williams accorded the Prime Minister and his political fellow traveler.

Here's the real question of the day: Did Premier Williams whip Harper's refusal to give an immediate answer into a storm because he thought the answer would be disadvantageous to this province or simply because he decided to push the matter to personal political advantage?

It's odd that this Calvert/Williams roadshow has but two stops - Saskatchewan and NL. One would have thought that it might have made better sense to stray from home territories to make forays into Ottawa, Halifax, Toronto or Vancouver in order to convince a wider audience.

But staying close to home makes perfect sense if the goal is merely to play to the home fans.

In the end, if Harper finally indicates that Equalization will be resolved to Williams' satisfaction then Williams can claim it that was his fight that made Harper cave notwithstanding the consistent assurances from Harper and his proxies (Manning, Hearn et al) that this province would not suffer under any new regime.

Maybe if Harper decides otherwise, it would be because he calculated he had nothing to lose from stirring the Premier's pique.

Equalization roadshow - two different takes

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

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

Local media is largely a political monoculture.

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

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

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

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

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The rhetoric of equalization

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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Premier outlines 'wrongs' of Confederation; Takes message west

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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