The December 2008 expropriation bill was not the right thing for the provincial government and the House of Assembly to do.
The expropriation was wrong.
It was wrong, but not because it didn’t work.
It was wrong, but not because the provincial government accidentally expropriated a contaminated mill site.
The December 2008 expropriation was wrong because it was a violation of the fundamental principles on which our society is supposed to operate.
Let us first of all dismiss the last argument that supporters use to justify the expropriation. We are not speaking here of finance minister Tom Marshall or any other member of the provincial Conservative administration.
We are speaking here of a New Democratic Party supporter.
In her comments on CBC’s On Point with David Cochrane this week, federation of labour president Lana Payne said that if the provincial government had not expropriated, then taxpayers would be facing a bill for clean-up without an asset to help pay for it.
Now Lana Payne has been an ardent support of the provincial Conservatives before on other issues. Still, we should always be surprised when supposedly progressive people support regressive ideas. And we should be astonished when the\ supposedly progressive people continue to support conservative political parties and their reactionary agenda long after the public knows the truth.
Never about the environment
You see, the expropriation was never about cleaning up the environment.
We know that because the provincial government’s scheme – from the outset – was to seize the cream of the assets and to leave the environmental mess in Abitibi’s hands. That is what provincial government officials told the opposition parties in the private briefings a couple of hours before they table the expropriation bill in December 2008.
We know this was their plan because the expropriation bill is laid out that way. Anything of value, including the Star Lake plant that wasn’t connected to the mill, went to the provincial government. Anything with a mess associated with it went to Abitibi.
The government scheme was simple: when Abitibi came looking for compensation, they’d be told that the cost of the clean-up they had to do and the cost of the compensation for the expropriation was the same number. Case closed.
Abitibi - a company the provincial government knew at the time was teetering on the edge of bankruptcy - would be left with the millions of dollars in clean-up costs. If the provincial government was genuinely worried about the environment, they wouldn’t have planned, as part of their scheme, to leave responsibility for clean-up in the hands of a company they should have suspected wouldn’t be able to handle it.
But that was their plan.
The Mill Mistake
We know the provincial government wanted to leave the environmental mess with a near-bankrupt company because of what happened when they discovered they had expropriated the mill site itself.
The very word should tell you that the provincial government wasn’t concerned about cleaning up the environment when they drafted the expropriation bill.
But anyway, the provincial government kept the mistake secret from the public for as long as they could. When they did release the information, the news release buried the truth under a pile of words that seemed as though they intended to hide what really happened. There was some guff about Abitibi abandoning its responsibilities.
Faced with such a serious mistake in their plan to leave the environmental costs with Abitibi, the provincial government – as then-natural resources minister Kathy Dunderdale later acknowledged – thought they would introduce new legislation to give the mill back to Abitibi. To un-expropriate the mill, as it were, and as foolish as the idea seems.
Almost a year after they expropriated the mill – by mistake – the provincial government issued a series of environmental clean-up orders to Abitibi. Those orders, issued in 2009 long after the expropriation, were part of the saga that wound up in front of a Quebec judge and ultimately the Supreme Court of Canada.
The judge in Quebec found and seven justices of the Supreme Court agreed that this was not a case involving a “detached regulator or public enforcer issuing [an] order for the public good”. In other words, the environmental orders issued in 2009 were part of the ongoing drama of the provincial government’s 2008 expropriation.
Rigging the Game
The expropriation act did more than seize valuable assets. In order to effect its compensation/environmental cost swap, the provincial government deliberately replaced the principles established in the Expropriation Act. Rather than give responsibility for setting compensation to a neutral third party (the public utilities board), the December expropriation gave that responsibility to cabinet, one of the parties to the expropriation.
Cabinet put Nalcor in charge of talks on compensation. Nalcor was one of the major beneficiaries of the expropriation. The December 2008 bill ended two power purchase arrangements between Newfoundland and Labrador Hydro and two private suppliers. Money that had gone to the private developers now went to Hydro coffers.
The 2008 expropriation also quashed an active court case that predated the expropriation and and denied the parties any compensation for costs. The case involved a lawsuit by Abitibi against the provincial government.
Responsible Government and the Rule of Law
Except for the brief period of Commission Government in the 1930s and 1940s, Newfoundlanders and Labradorians have enjoyed responsible government since 1855.
“Responsible government”, wrote the late Senator Eugene Forsey, is “government by a cabinet answerable to, and removable by, a majority of the assembly.”
The rule of law is one of the fundamental principles of by which our responsible government operates. According to Senator Forsey, the rule of law means that “everyone is subject to the law; that no one, no matter how important or powerful, is above the law — not the government; not the prime minister, or any other minister; not the Queen or the Governor General or any lieutenant-governor; not the most powerful bureaucrat; not the armed forces; not Parliament itself, or any provincial legislature.”
Because the cabinet is usually made up of members of the majority party in the assembly or legislature, it can have an easy time of doing as it pleases. The British parliamentary system on which we base our own form of responsible government has evolved over a great many centuries ways we constrain the power of government so that it cannot act that way.
The rule of law is one of those ways by which we constrain government’s action. We define the power of government in the constitution. The legislature passes laws openly, in public and after debate. Those laws apply equally to all, including government – the rule of law. The courts – an independent judiciary – uphold the law and act as another form of limitation on the government.
While the rule of law takes many shapes, the basic idea that the rules apply equally to all is central to our our political system is to supposed to work. Generally, it works because not only is government constrained but the people who make up the cabinet understand the need for limitations on government power.
The expropriation bill represents one of those examples of where government does not act with restraint. It is an example of how the government changed many of the rules of the legal game in order to get what it wanted. That is why the expropriation was wrong.
In that sense, the expropriation bill is the same as Bill 29 and Muskrat Falls. In each of these three examples, the provincial government decided what it wanted to do. Then it set about to change the rules in order to get what it wanted for its own ends and –despite the rationalizations by government supporters - solely in its own interests.
The provincial government tried to avoid scrutiny, evade accountability, and conceal its actions. And that is most definitely not in the interests of Newfoundlanders and Labradorians.
The rule of law is not broken in Newfoundland and Labrador. Court decisions since 2003 have confirmed that the government cannot get away from the law completely. But that has not stopped the provincial government from carrying on some hideous abuses of the rule of law and of individuals.
Some in the province undoubtedly still come forward to defend episodes like the expropriation because Abitibi deserved it, somehow, or because the company is a gang of outsiders. The same people often said the same sorts of things when Danny Williams launched into one of his xenophobic tirades.
But that turned out to be another foolish idea. Mark Griffin, your humble e-scribbler, and others have found, however, you didn’t have to be a come-from-away to face the verbal wrath of some high official of the provincial government. And even if one could still rationalize the expropriation on an anti-foreigner basis, Bill 29 and Muskrat Falls – of course – have their impact only on harm only Newfoundlanders and Labradorians.
Therein lies the danger of a government that changes the rules of the game to suit its own purposes. Whatever the government will do against a powerful corporation, it might just as easily do against those in our community who are much less powerful.
We do not need to imagine something like that.
We can ask Max Ruelokke.
Abusive government measures have no place in a fair and justice society.