That’s all Tom Marshall said it would take to sell out the bonds on Muskrat Falls.
He also said that a federal loan guarantee would lower electricity prices for consumers from Muskrat falls.
The price one wasn’t true at all, as it turned out, and the bonds aren’t all that popular either.
”Bonds for the $7.7-billion Muskrat Falls hydroelectric dam and a pair of related transmission lines, though federally guaranteed, are among the five worst performers this quarter among the top 50 provincial issuers on the Bank of America Merrill Lynch index,” according to the Globe and Mail.
Lots of folks think that the government’s current financial problems will last only for a couple of years. Those folks have no idea what is happening.
Those folks also haven’t considered the impact of Muskrat Falls on the local taxpayers. It’s an enormous project. The Globe story understates the cost of the project by about $2.0 billion. The entire debt for the project will be borne by provincial taxpayers. Those taxpayers will face a new tax – that’s what MF really is – on top of the massive government debt load that will suck hundreds of millions of dollars out of the economy each year.
As it seems, Wade Locke didn’t assess the impact of high oil prices combined with a massive new tax when he endorsed Muskrat Falls in 2012. Apparently, he hasn’t assessed the impact of massive Muskrat Falls debt on top of all that other public debt with a low oil price environment either. The folks at the Memorial University economics department could model that current problem instead of talking about the massive increase in public sector employment five years after it was an issue.