25 August 2014

Mystery Meat #nlpoli

The Telegram’s exceedingly generous headline said that Conservative leadership candidate Paul Davis put meat to the bones of his  campaign on Friday by announcing details of his policies. 

In reality,  Davis offered vague platitudes for the most part with very little substance to any of his plans.  There’s nothing surprising in that.  Pretty well all the provincial politicians and parties have kept their plans and ideas vague.

You can see the vagueness in Davis’ financial priorities.

Davis will “allocate resources in accordance with policy priorities.”  That is what every budget does, whether it is for your house, your business or the province.  It takes your resources and sorts them according to what is most important to you.

Davis will “commit to budgets that are comprehensive, long-term, transparent and realistic.”  That’s what current budgets are supposed to be.  That’s what all provincial budgets should be.  Is Davis saying that he has been in a cabinet that produced budgets that covered only some things,  that looked at the short-term,  were cloudy and secretive?

At least Davis correctly notes that the changes he claims that have come in the province’s future since 2006 are due to “expanded development of non-renewable natural resources, especially offshore oil production and mineral projects.”

More oil and gas development.

But on the overspending that the past three Premiers have admitted is at the centre of current financial policy, Davis is silent.

On the massive public debt?  Silence.

On the decline of revenues from non-renewable resources?

Here, Davis is not so silent.  He knows what he wants to do.  Davis proposes to sit with Statoil and complete a development agreement with the company for its Flemish Pass basin property.  There’s oil there but the company isn’t sure  - and the government isn’t either – how much resource is there or how much it will cost to get it out of the ground and out to market.  No one knows if the project is commercially viable.

And yet Davis wants to sign a deal by 2015.

Such a plan is reckless and displays a profound ignorance of the the oil and gas industry and the province’s financial condition.  At the same time, Davis plans to develop a new energy plan supposedly based on “newfound knowledge and revised priorities.”  The two things don;t fit together.   The message this sends is a very bad one:  the biggest and richest corporations in the world can line up with their hands out. Premier Davis and the Conservatives are so desperate to see oil development offshore so he can get re-elected,  they will likely sign anything he can to get something underway.

There’s no small irony that this is exactly the same claim Danny Williams and the Conservatives made about Roger Grimes and Voisey’s Bay in 2003. Everyone knew the approximate size of the resource.  Vale/Inco wanted a deal just like the government did.  They could project the markets and therefore the costs and risks associated with the venture.

Grimes’ wasn’t Paul Davis.  He had far more experience than Davis, including experience handling big departments like health through tough times.  Davis doesn't have that kind of experience. And the Liberals back then had a record of signing development deals that produced $19 billion for the Conservatives to spend once in office. They were not the Williams Conservatives, complete with a track record of admitted, unsustainable  (i.e. unaffordable) public spending and record increases in public debt. The money that fuelled the Conservatives’ spending spree came  entirely from oil deals signed before 2003.  Don;t forget that  Williams actually acknowledged that the Voisey’s deal was a very good one, although he said that long after he attacked Grimes in order to get elected.

Davis and the Conservatives are in a far more precarious spot politically that the Grimes’ Liberals ever were.  What’s more, they’ve  got a record of handing over control of provincial oil and gas negotiations to Nalcor.  The last time the Conservatives did that,  at Hebron, Ed Martin never even fought for local development benefits.  He just let them slide away because he had never supported them anyway.  Nalcor has already abandoned the 2007 provincial energy policy presumably with government support. We know Davis wants to write a new plan based on some undefined new priorities. That doesn't sound very comforting. There were plenty of give-aways by the Conservatives to industry in Hebron, presumably because the government was desperate for an agreement, and that was when we thought we understood what the Conservative priorities were.

But Hebron  was at a time when the Conservatives were unchallenged at the polls, riding so high on an orgy of public spending that politicians and community leaders couldn’t even see the bottoms of Danny’s feet let alone his ass as they desperately sought to kiss either one that came into view.  It makes you wonder what the Conservatives might do when things are not nearly so rosy for them politically.

How much will Paul give away of an unknown resource with untold potential value, just to keep his ass in a cushy job?

With that question hanging out there, you’d be vague, just like Paul Davis.