12 February 2015

Money and Politics in Newfoundland and Labrador #nlpoli

Some people are making a big deal over the fact that the judge heading the boundaries commission made political donations to both the Liberal and Conservative parties in the province before he was appointed to the Supreme Court Trial Division.

Justice Robert Stack made donations totalling $1,718 to the provincial Liberal Party between 1996 and 2003 and $2,032 to the provincial Conservative party between 2001 and the time he was appointed by the federal government as a Supreme Court judge in 2009.

No one has actually explained how what is a normal activity for ordinary citizens in every province in Canada is problematic in this case.  There’s just the innuendo that goes with a comment like this:

“Nobody's really questioning that Justice Stack has the qualifications to do what he's being asked to do, it's about whether or not there are other connections that then make it a little more questionable.”  [See new comment by Kelly Blidook at end of post]

Insinuation and Innuendo aren’t evidence of anything except the exceedingly bad judgement of the people making the comments and the news media who are repeating them.

.In this case,  Stack is well-known and respected lawyer. Over the course of 13 years, he made modest donations to the two major political parties in the province.  There’s nothing odd or unusual about it in any way in this province or anywhere else in Canada or the United States.  There’s no reason to believe that he has any bias that would impair his ability to run the boundary commission based on the mandate given him by the House of Assembly in January.

That’s not to say there isn’t a need for political finance reform in Newfoundland and Labrador. The current campaign finance law dates from the 1990s. It’s the first such law the province ever had and it’s badly in need of an overhaul. The Conservatives promised finance reform in 2003 but they never delivered on the promise. There really is no greater political fraud than an promise unkept.

Construction Companies, Conservatives, and Capital Works

What they did instead was preside over an era of old-fashioned corporate donations.  In 2011, for example,  SRBP noted the curious pattern of corporate donations involving companies obviously doing quite well for themselves given the massive level of government overspending, much of it on major construction projects:

“Construction, design and engineering companies gave the provincial Conservatives $239,725 in political donations in 2010, according to figures from the province’s chief electoral office.

Companies in the design, engineering and construction field gave a mere $3, 950 to the Liberal Party and none to the New Democrats.”

The always provocative and well-informed labradore took it a step further:

This observation [about construction companies] is a subset a figure which yours truly twoot yesterday, namely, that nearly three-quarters — 74% and change — of all contributions to all provincial political parties in 2010 came in the form of corporate contributions to the governing Progressive Conservatives.

All other contributions, personal, union, or RNC, and to all registered provincial parties, made up the other 26%. Contributions from private individuals constituted less than 20% of the entire total of reportable political donations.

Not only is it staggering how anaemic the provincial party financing system is, it is concentrated very heavily in and around Capital City. Now, this overly-urban concentration of political money is a feature of fiscal democracy for just about every party in every jurisdiction in North America. But, at least at first glance, the situation in Newfoundland and Labrador seems to take it to the extreme.

The Money is Blowing in the Wind

The situation was unique.  labradore documented in 2007 the case of a n outfit called NeWind, a consortium of three companies who landed a contract from the provincial energy company to build a 25 megawatt windmill electrical generator. It’s worth quoting extensively from that old post:

NeWind is a consortium of three firms: CHI Hydroelectric, fga Consulting Engineers Limited, and Quadratec Inc.
As a matter of interest and public record, all three companies, but especially Quadratec, have a long history of supporting the democratic process. Since 1996, Quadratec have donated at least $24,275 to the provincial Liberal party, and $13,950 to the PCs.

fga Consulting Engineers, in the same time frame, gave $7,100 to the Liberals and $8,275 to the Tories.
CHI have only made two donations. Both were in 2003, an election year, and both were to the Progressive Conservatives.

From 1996 to 2002, inclusive, Quadratec and fga gave a total of over $26,000 to the then-governing Liberals, but only $6,000 (less $25) to the then-opposition Conservatives. In each year up to 2000, the overwhelming majority of their support for the democratic process went to the Liberals; in three of those five years, 100% of that support was for the governing party.

During the Grimedämmerung years of 2001 and 2002, the companies were more even-handed in their political donations, still favouring the provincial Liberals, but just: 53% and 57% of their political contributions were Liberal in those two years, respectively. The rest went to the PCs.

In the election year of 2003, 75% of the NeWind consortium members' donations (the NeWind consortium itself has no history of donations on its own account) went to the PC party of Danny Williams. This includes the only two NL provincial political donations ever made by CHI Hydroelectric, a company whose domicile is given in the provincial electoral office documents as Montreal, Quebec.

In 2004, the Tories firmly in power, that figure was 90%.

In 2005, the most recent year for which figures are available, every cent of the consortium members' $4600 in political contributions went to the governing Tories.
From 2003 to 2005, inclusive, and without figures for calendar year 2006 being yet available, the NeWind consortium members donated a total of $22,500 to the Progressive Conservative Party of Newfoundland and Labrador, and $5,000 to their Liberal opponents.

None of the three have any history of contributions to any other provincial political party or candidates.

labradore compared the local case to the one in Nova Scotia.  The contrasts were stark.

If you are interested in reading more about campaign financing,  there have been plenty of posts at labradore and at SRBP over the past decade.

Follow the Money

There’s a long history connecting public money with political campaign financing in Newfoundland and Labrador.  Even these days,  officials at lots of companies will tell you that they make political donations because they believe that it plays a role in how the provincial government awards contracts.  They won’t say whether it does or it doesn’t:  the thing to notice is that they genuinely believe making political contributions – and lately not making them to an opposition party – will have an impact on their success in a contract award.  There’s a flip side in it as well, namely that the people involved with these companies believe that if they don’t give the money, it might put them at a disadvantage if their competitors are party donors.

There’s a desperate need for campaign finance reform in Newfoundland and Labrador.

Slagging off a respectable judge for a few legitimate donations isn’t the place to start.


Friday Monday:  Enforcing the Finance Rules