The New Hebron-Muskrat Falls Connection #nlpoli

Natural resources minister Jerome Kennedy is right:

“There's obviously an obligation…on any member in this house when presenting a petition to ensure that accuracy, to ensure that statements made to this house are ones that can be relied on ... This is a very serious matter."

The obligation for accuracy doesn’t just apply to petitions.  It applies to everything a member of the legislature says.

And if the member of the House is also a cabinet minister or the Premier, then the obligation for accuracy goes up another few notches.

How’s that again, Jerome? #nlpoli

Natural resources minister Jerome Kennedy in the House of Assembly on Wednesday explaining some of the financial aspects of Muskrat Falls:

The one thing I need to make clear though to the people of this Province that any equity investment in Nalcor is on the basis of the project being sanctioned. The money stays in the Department of Natural Resources and is then disbursed to Nalcor as money is spent, Mr. Speaker. Also, it does not go to the net debt of the Province because it is a capital investment. In this particular case, Mr. Speaker, we have a revenue generating asset which can produce monies and revenues for this Province, along with hydroelectricity, for 100 years. [Emphasis added]

In the first bit he describes how the cash goes from the provincial government to Nalcor.  That would be the $2.9 billion they plan to spend on the dam itself. 

The problem comes with that bit in bold print.

A fresh smear of lipstick #nlpoli

CBC’s online version got the story right from the most recent episode of On Point with David Cochrane:

Natural Resources Minister Jerome Kennedy says the Newfoundland and Labrador government is not back-pedaling in how it is handling the Muskrat Falls hydroelectric project, even though the governing Tories are already planning measures they had ruled out.

And Kennedy is being absolutely straight with people:  the provincial government is not changing its direction.

Most emphatically and absolutely no change.  It’s Muskrat Falls or bust.

The ruling Conservatives are just changing the tone.

They are changing the appearance of things as they try and recover from the very serious blow delivered recently by the public utilities board

Look at what Jerome told David Cochrane.  two phrases in particular leap out:

“You have to show as a politician that you are flexible and open to listening to what the people are saying … what we are trying to do is assure the people of the province that everything is being considered…”

Show.

Not be.  Not do.

Show.

Open to listening.

Not actually listening. Or listening and then changing.

Just listening.

And that’s what this latest development is really all about: the appearance of change without actually changing.

Odds are very good that the government’s polling – done by Nalcor’s advertising agency – is showing that the government’s intransigence is undermining their credibility even further. Their strategy isn’t working.  People aren’t willing to just put blind faith in Jerome and Kathy and Fairity O’Brien.

That polling would very likely lead to advice for Nalcor and the government to change how things look.  Image, after all,  is everything for some people.

You wouldn’t need to poll, though, to hear people wonder aloud why the government is proceeding with this project at break-neck speed and despite the thoughtful criticism from a bunch of very smart people with tons of credibility.

You could also tell earlier on that the critics’ comments about Muskrat Falls did serious damage to the government case for Muskrat Falls.  Jerome Kennedy attacking them personally.

So now there will be a debate in the legislature.  As Jerome noted for On Point, the government has to introduce a piece of Muskrat Falls legislation this session anyway so they will now just have a bigger form of that debate.

Hang on a second.

What piece of Muskrat Falls legislation?  They’ve never mentioned that before.  Maybe we’ll find out what the legislation is about but notice that for all the promises Jerome made about assuring everyone that the government will put information in front of people, he hadn’t mentioned that important piece of information before.

The problem is not image.  It’s credibility.  They say one thing and do something else.

This new piece of legislation for Muskrat Falls will come before project sanction.  Logically, friends, that pretty much wipes away any suggestion in Kennedy’s comments later on with David Cochrane that Muskrat Falls might not happen.

Not surprising that Jerome didn’t mention it before now. Makes it kinda hard to assure people you could walk away from Muskrat Falls without batting an eyelid if you are planning to change the laws to pave the way for it before you’ve supposedly decided to get on with it.

So anyway, once again Jerome Kennedy wants to reassure people in the province that they will have all the information the public utilities board couldn’t get plus reports on wind and natural gas in order to assure the people of the province that Nalcor has considered all options before picking Muskrat Falls.

He mentions reports on wind and natural gas that some companies will complete for Nalcor. 

Just remember what Nalcor and the provincial government have always said.  You can find it in a blog post by Nalcor boss Ed Martin over at Nalcor’s “leadership” blog, posted April 5:

Nalcor examined a broad selection of generation supply options to meet the island’s growing and long-term electricity needs including: nuclear, natural gas, liquefied natural gas, coal, continued oil-fired generation at Holyrood, simple and combined cycle combustion turbines, wind, biomass, solar, wave and tidal, hydroelectric developments on the island and Labrador and electricity imports.

They looked at it all before picking MF.  You name it: they studied it.

Supposedly.

So what’s with the new studies?

Good question. 

If the MFers had really had looked in detail at everything before picking Muskrat Falls, then they would  - Number One – already have those studies and would not need to produce “reports”, and  - Number Two – they’d have already released them to show that the alternatives just don’t work.

Yes friends, you are already getting the distinct aroma in your nostrils of the spore from rattus politicus pinocchiosa.  That is one honking big rat turd you smell, too.

You see, we know what these reports will say.  We know because Jerome told us.

March 6 in the House of Assembly:

MR. KENNEDY: … We have looked at natural gas, Mr. Speaker, extensively. In fact, I can say to the Leader of the Opposition, I met with Ziff Energy out of Calgary on the weekend while in Toronto on another matter. They concluded, clearly, that the importation of gas from the United States is not economically feasible. Mr. Speaker, we know, clearly, that the building of a pipeline from the Grand Banks is not feasible. If the Leader of the Opposition has other options, I would like to know what they are.

March 7:

MR. KENNEDY: … I have met with different consultants in this area, most notably Wood MacKenzie out of New York and PIRA out of New York. We have discussed the issue of the pricing of natural gas and the effect of shale gas on markets and electricity markets.

This past weekend, Mr. Speaker, I met with a company called Ziff Energy out of Calgary. I met with them in Toronto. We outlined to them the proposals that had been put forward by various critics of the project and the conclusion reached, Mr. Speaker, by all of these consultants, experts, not self-professed experts, Mr. Speaker, the conclusion reached is the importation of natural gas is not economically feasible, nor is the building of a pipeline from the Grand Banks.

Remember Jerome’s penchant for slagging the critics”  “Not self-professed experts”.  You can tell that all those critics, none of whom are self-professed anything, are causing Jerome and his mates lots of trouble.

And if that doesn’t jog your memory, here’s Jerome from March 13:

MR. KENNEDY: Thank you, Mr. Speaker.

Mr. Speaker, Mr. Ed Martin, the President of Nalcor, outlined in great detail the steps that they had taken in terms of looking at the options for Muskrat Falls, Holyrood refurbished. They indicated that at the Decision Gate 2 process, liquefied natural gas was screened out. Mr. Speaker, as Mr. Martin indicated, it was a fairly easy decision at that point because the viability of building a 350 to 650 kilometre pipeline from the Grand Banks just did not work. I am not aware of any LNG study.

Mr. Speaker, I have indicated on several occasions, I have met with experts, notably Wood MacKenzie in New York, PIRA in New York, and Ziff Energy of Calgary and discussed natural gas. I have indicated that the opinions given to us unanimously are that natural gas is not going to work. There are no studies or reports that I am aware of. If there are, they are in the eight boxes and I suggest that the Opposition go through them.

To paraphrase Jerome’s line until now:  We looked at it all.  We’ve talked to the experts.  They tell us we were right the first time.

Nothing changed at all in his discussion with David Cochrane over the weekend, except the cosmetic shift in tone we’ve already noted.  Any claims or suggestions to the contrary are simply unfounded.  you won’t need an expert study to see why.  To borrow a phrase the lawyers like:  the thing speaks for themselves.  Res ipso loquitur.

And even with a make-over, Muskrat Falls is still in trouble and the strategy the government is following is still Arnold Ziffel with a new smear of lipstick.  They are ploughing ahead with Muskrat Falls and all the sound advice in the world won’t persuade them to change their course.

We know that because finance minister Tom Marshall said it on province-wide radio this week, before Jerome tried to change the tone of government’s MF message track:

The opposition will get its say, then the government will get its way.  That’s how democracy works.

That isn’t how democracy ought to work. It is, however, how Jerome and his friends know it does work around these parts.  They just get shy when people realise it.

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$#*! politicians say: Jerome! edition #nlpoli

Everyone’s favourite natural resources minister outdid himself last week for saying things that were just so far removed from reality that they were just funny.

He said them in the House of Assembly and if that wasn’t good enough he repeated them for this week’s episode of On Point with David Cochrane.

By the by, here’s the real take-away from Cochrane this weekend:  the Tories are in such political shape generally and are saying such complete rubbish that Cochrane looked like he was trying desperately not to break down laughing at Kennedy and David Brazil.

This is the hardest pounding Cochrane has delivered to any politician in years and he did it to two of them on the same program.  Make no mistake:  Cochrane was thoroughly professional and fair.  What he did was just refuse to let utter crap go unchallenged.

And it was crap.

Kennedy insisted he wanted to hear all sorts of criticism to point what is wrong with the Muskrat Falls project.  “Show us where we are wrong,” Jerome says.

But as everyone have seen over the past few months, the government simply attacks the critics personally (they are just politically motivated according to Kennedy) or dismisses the criticism.

And when they aren’t doing that, the government just makes shit up.

Like when Jerome claimed that Nalcor and the government had studied natural gas as an option and dismissed it. 

They dismissed it alright, out of hand. They’ve been stuck with all the assumptions they found in a 1980 study, long before anyone found natural gas offshore.  Read the feasibility study done in 1980 and notice the strange similarity to the current thinking about which two choices to think about and which one is cheaper.  You’ll be amazed.

But there’s absolutely no sign that anyone connected to the provincial government has ever given natural gas a moment’s serious thought for what it is:  a much lower cost alternative to Muskrat Falls that would actually produce more electricity than Muskrat Falls ever could.

A natural gas plant with 824 megawatts of installed generation could produce the full amount.  Muskrat Falls will produce – on average – about the equivalent of 570 megawatts or so. The cost would be considerably less than half the cost of Muskrat Falls and the line to Nova Scotia, which incidentally, is now $8.9 billion.

Perhaps the funniest new line Kennedy is using is that Muskrat Falls will be needed to generate electricity for new mining development in Labrador.

That’s a new one.  Until now, Muskrat Falls was supposed to be a replacement for Holyrood. But that’s only for three months a year   A bit of electricity will go off to Nova Scotia for free and the rest was supposed to be sent off to some unknown foreign lands.

During the environmental review process, Nalcor couldn’t produce a single concrete sale to show just how much greenhouse gas Muskrat Falls would displace.  The reason is simple:  MF electricity is too expensive.  No one will buy it.

So now Jerome’s got a new story:  Labrador mines.  The mines will need all of Muskrat Falls and then some besides.  So where we will get the electricity to replace Holyrood?  Someone should ask Kennedy that one so he can invent a new answer.

Last week in the House, Kennedy had another gem:

MR. KENNEDY: …

Gull Island is not possible because we cannot get through Quebec, Mr. Speaker, wind is not an option and we know that natural gas is not an option. I say to the Leader of the Opposition: What options are you talking about? What is it you want us to explore? We have explored everything. Muskrat Falls is the lowest cost and best option to secure the future of this Province.

“Gull Island is not possible because we cannot get through Quebec.”  That is exactly what Kennedy said, word for word.

And not a word of it is true.

Nalcor current sells electricity to New York by running it through Quebec.  They’ve been doing it since 2009.  If they had someone to buy any electricity from Labrador, they could move it through Quebec without a problem.  The reason they aren’t developing Gull Island is because they don’t have any customers for the power.

Full stop.

In fact, if they had customers to justify Gull Island, that’s the one they’d be building because it would be more cost-effective than Muskrat Falls.  In fact, if you look at Nalcor’s own information provided to the public utilities board, it appears they never started looking at Muskrat Falls as a stand-alone project until 2010.  It’s worth quoting a couple of paragraphs from that Nalcor document:

In 2010, Newfoundland and Labrador Hydro was faced with a decision relating to generation expansion for the Island Interconnected System for the timeframe ranging from 2015 to 2020. As ensuing analysis indicated that the least-cost expansion option would involve a Labrador-Island HVdc (high voltage direct current) infeed, it was determined that priority should be given to the Muskrat Falls Development. This development would be sufficient to meet forecasted demand in for the Island Interconnected System, while providing some additional capacity for potential export to the Maritimes.

Based on this change, the proposed 1600 MW multi-terminal HVdc scheme would be replaced with a smaller point-to-point system from Muskrat Falls to Soldiers Pond. With an estimated annual plant capability of 4.9 TWh at Muskrat Falls and up to 300 MW of available recall capacity from the Upper Churchill, it was determined that the HVdc link should be sized for 900 MW.

Looking at what Jerome Kennedy said last week about Muskrat Falls, you’d almost think he was making this $#*! up as he goes.

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It’s all about export, eh #nlpoli

On Tuesday, natural resources minister Jerome Kennedy told the House of Assembly:

Essentially, what Muskrat Falls does, it allows 40 per cent of the power for the Island to meet the Island needs, 20 per cent for the export - 170 megawatts which allows us to then gain access to the markets in the United States, in the Maritimes, but also to develop other hydro and wind sources on the Island, and 40 per cent of the power for Labrador.

Of course there are no chances of exporting the extremely expensive electricity from Muskrat Falls into any other province, let alone export it and make money.

But hey, let’s humour Jerome! for a bit.

Don’t forget to notice the part that is about the link to Nova Scotia:

170 megawatts which allows us to then gain access to the markets in the United States, in the Maritimes, but also to develop other hydro and wind sources on the Island

Export.

That goes with Jerome’s comments over the past few months about all the revenue that will come from Muskrat Falls.

So what did Jerome say on Wednesday, a mere 24 hours later?

… we see the Maritime Link as a great opportunity to gain a billion-dollar asset for our children and grandchildren, Mr. Speaker, an asset that will continue to produce revenue, which opens up the ability to move power when needed, Mr. Speaker, to the Maritime Provinces, but also it allows us to bring power back…

There’s that revenue thing again, even though Nalcor has no customers for any Muskrat Falls power outside this province.  Basically, if they can’t force people to pay for Muskrat Falls, no one will.

But look at the words at the end.

…it allows us to bring power back…

The energy warehouse will be importing electricity now, according to Jerome Kennedy.  All those people who will be making money from Muskrat falls – if you believe Jerome – will also be able to live the dream he has and buy electricity from somewhere else.

Why would our children and grandchildren and their children and grandchildren do that if  - according to the provincial Tories - we have more than we need and want to export it all forever and a day especially after 2041 when we “repatriate” Churchill Falls?

Sometimes you really get the sense that Jerome and his friends just make stuff up as they go.

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Muskrat Falls: The Kennedy Tweets #nlpoli #cdnpoli

Here’s a string of tweets from natural resources minister Jerome Kennedy on Friday night:

Jerome Kennedy @jerome_kennedy
Let me try and simplify Muskrat Falls. First question, do we(NL) need the power? If yes, then question # 2,what are we going to do about it? 

Jerome Kennedy @jerome_kennedy
MF cont'd. If we need the power what are our options: Muskrat Falls, refurbish Holyrood with small hydro and wind,Gull Island,or do nothing. 

Jerome Kennedy @jerome_kennedy
MF cont'd. Gull island is not an option at present. To do nothing is not an option. So, do we do Muskrat Falls or refurbish Holyrood. 

Jerome Kennedy @jerome_kennedy
MF cont'd. Nalcor argues that MF is $2.2B cheaper than Holyrood.Manitoba Hydro will examine this question and they are independent of govt. 

Jerome Kennedy @jerome_kennedy
The cost of oil makes Holyrood so expensive. At peak it burns 18,000 barrels of oil per day. Experts tell us that oil will continue to rise 

Jerome Kennedy @jerome_kennedy
Why the cost of oil will continue to rise-not enough supply to meet demand, activities in the Middle East and growth in China. Makes sense. 

Jerome Kennedy @jerome_kennedy
MF cont'd. Cost of fixing up Holyrood is $600M. Forecasted cost of oil between 2017-36 is more that $7B.Hydro avoids the volatility of oil.

And then came this one:

Mark Watton @mark_watton
@jerome_kennedy You know, if the House were sitting, you could do this using more than 140 characters at a time. #nlpoli in reply to @jerome_kennedy

Followed by complete silence from the minister.

Interesting synopsis of the government argument, though.  Interesting because of what it leaves out.
There’ll be more from SRBP in the days ahead.

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More Tweets Update:

Jerome Kennedy @jerome_kennedy
MF cont'd(No.8) - Environmental benefits - Closing Holyrood is the equivalent of taking 300,000 cars off the road.Reduces GHGs by 1M tons/yr.

Jerome Kennedy @jerome_kennedy
MF cont'd (No.9) - Economic Benefits- peak employment of 2700. Job preference to Labradorians. Billions in income and taxes .Little talk of this.

And yet more tweets (Jan 22):

MF No.10 - Power rates continue to rise due to the price of oil. Critics argue that rates will double because of MF.This is simply not true. 

MF No.11-The average ratepayer will pay $217 monthly in 2016,pre-Muskrat.This is projected to rise to $232 in 2017 when MF starts up (▲$15). 

MF No.12-With Muskrat Falls the average user's rates are projected to go up from $232/mth to $246/mth between 2017-30. Rates will rise $14. 

MF No.13-Without Muskrat rates are projected to go up $57 between 2017-30,as compared to $14 with Muskrat.MF will stabilze [sic] and reduce rates.

Kennedy slices into NDP’s Muskrat falls hypocrisy #nlpoli #cdnpoli

Natural resources minister Jerome Kennedy belled the NDP cat on Wednesday for the provincial party’s flip-flop on Muskrat Falls. As the Telegram reported in its Thursday edition,

… Kennedy was particularly hard on criticism coming from the NDP, saying the current tone represents a break from deceased federal leader Jack Layton.

“The NDP has been making a lot of noise in the last little while, but it’s my understanding that Jack Layton supported the project,” Kennedy said. “Does the NDP still support the project? They’re not answering that.”

Jerome is right, of course. 

And not only about Jack Layton’s support. 

Bloc-NDP members of parliament Ryan Cleary and Jack Harris campaigned on a pro-Muskrat Falls ticket during last year’s federal election, as did provincial party leader Lorraine Michael who joined them on the campaign trail.

Enterprising news editors will no doubt be scrambling for shots of Lorraine cheering Jack’s visit here as she cheered Jack on and looking through Lorraine’s old news releases.

Lorraine supported the Lower Churchill project.  Her only criticism at the time it was released is that the deal was not as big as the original promise.

But make no mistake:  Lorraine backed Muskrat Falls.

However, she’s been shifting her position as public opposition to the project mounted.  You could say she’s trying to pull an Aylward.  Former Liberal leader Kevin Aylward shifted his potion almost 180 degrees on the project during the latter days of last fall’s provincial election. 

Now Michael is trying to sound like she isn’t backing the plan to deliver cheap electricity to her New Democrat pals in Nova Scotia.  Here’s how the Telegram quoted her from another Muskrat story from Thursday’s paper:

NDP Leader Lorraine Michael said she’s open to being convinced that going ahead with the project is a good idea. Nothing Locke said moved her, though.

She said she’s hoping to see independent, in-depth examination of alternatives to Muskrat Falls before the project gets sanctioned.

“If there was an in-depth analysis that was done on an alternative like the wind power — an in-depth analysis — then I’d like to see it,” she said. “My understanding is that no in-depth analysis has been presented.”

The spring session of the legislature should be interesting if only for the political cat-fighting among members of three political parties all of which support Muskrat Falls to one degree or another.

The Liberals back the project as well.  Their only objection, as described by natural resources critic Yvonne Jones is that there is no guarantee any power will go to Labrador.

Power could go there, of course, but Jones apparently wants some other guarantee. her objections are best described as superficial or trivial.  She’ll fold up and back the thing when it comes down to it.

But a crushing public debt?

The enormous cost piled on the backs of ordinary people of this province while others get a free ride?

Not a worry for Jones and the Liberals apparently.

Kennedy will have an easy time of it in the House lined up against the likes of the NDP and the Liberals.

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‘eavy ‘angs the ‘ead #nlpoli

Natural resources minister Jerome! Kennedy is wading deeper and deeper into the political morass called the Muskrat Falls project these days and finding that it is a sticky, stinky, mess.

For not one, but two days running, Jerome has been trying to explain to VOCM’s afternoon radio call-in host why Jerome and the Nalcor gang are right and everybody else is wrong. 

On Wednesday,  Jerome talked about a bunch of charts and tables he must have sent over to the host.  They both talked about what the tables showed:  how prices for electricity will be this if Muskrat goes ahead and will be that if it doesn’t.

“Will” as in “guaranteed to be.”

Only problem for Jerome! is that his numbers aren’t guaranteed anything at all.  They are speculation.  They are based on assumptions.  – at best – highly speculative. 

The price might be this. 

Or it might be something else entirely.

It all depends on what assumptions you make. 

Take, for example,  two of the key assumptions.

For Muskrat Falls to make any sense at all, crude oil must go to at least $200 a barrel and stay there.  Anything less than that and taxpayers are better off not building Muskrat. 

Second, Muskrat must also cost the projected price or less.  Odds of that happening are very small.  Jerome! insists that Nalcor has that one covered.  They have included in their estimates a possible cost over-run of 15%.

Unfortunately, the current provincial government (Nalcor and government are indistinguishable) couldn’t deliver pizza and guarantee a mere 15% cost over-run.  Government capital works projects these days are usually at least 50% more than they predict. On some projects they’ve gone 100% over budget. 

You get the point. 

There is only one combination of circumstances where the Danny/Jerome/Kathy idea for Muskrat Falls  works out for taxpayers and a bunch of combinations in which it doesn’t.  You don’t have to be a rocket scientist to know the odds of winning Lotto Jerome! are pretty small.

There are other aspects of the Muskrat Falls case that don’t make sense either, like the potential alternatives to Muskrat Falls, the export prospects and the forecasts for energy demand.  Critics of the project have systematically demolished all of them.  Not one survives to this day intact.

And yet Jerome! and Kathy Dunderdale and Nalcor keep pushing them.

Things didn’t get any better for the MF gang on Wednesday.  Economist Jim Feehan dissected an underlying problem in how the province sets electricity prices.  Tackling that one would encourage consumers to change some of their more wasteful ways they use energy. Lowering demand also lowers the need for expensive megaprojects.  Feehan’s approach could, if current trends continue, allow Nalcor to avoid the most expensive megaproject in the province’s history,  mothball the Holyrood plant and deliver consumers affordable electricity into the future.

If Feehan’s idea isn’t the only solution it’s one of the elements that a responsible provincial government would include in its energy policy for the province. 

Feehan’s commentary is a sign of how the opposition to Muskrat Falls is growing.  This time last year, Feehan thought Muskrat was a great – if pricy  - idea. Having taken a hard look at the project, Feehan has changed his mind.

Feehan’s comments also reflect the way the discussion is going.l  Critics of Muskrat Falls are looking not only at the weaknesses of the proposal itself, but also at the shortcomings of the current administration’s energy policy.

That’s good for the people of Newfoundland and Labrador.

But for politicians like Jerome!, it means that two days of chatting up Paddy will turn into three and maybe more.

And the chances of winning more people to the cause just keep getting smaller and smaller.

Much like the chances that building Muskrat falls the way Jerome! and Kathy want to will deliver any benefit to the people who own the resource.

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Connie Leadership 2011: Persistent Rumour Department

All Christmas.

Jerome! will announce he won’t be running for re-election.

Sometime before the end of January, he’ll make a statement. 

Yes, yes, everyone knows that Jerome!’s already said publicly he’ll be running again but this rumour has survived that pretty clear statement.  After all, Danny insisted he was running again but that turned out to be not quite what happened.

And it only took the Old Man a week or so to go from telling Debbie Cooper that he was constantly re-evaluating his future to flinging his gear into the truck and heading for the hills.

If Jerome doesn’t run again, he doesn’t qualify for a politician’s pension. That could be a powerful incentive to stay on for another term.  

There’s pretty much no hope of a seat on a federally-appointed court.  His buddies could appoint him to the Provincial Court but they’d have to give him a pretty senior and largely made-up appointment.  No one expects that Jerome! is going to be sitting in Goose Bay or anything like that. That would also lead to lots of guffawing in the legal community as the guy who slagged political patronage appointments to the bench became one.

If Jerome doesn’t run again, then he’d have to go back to the old law practice or find some other business to pay the bills.

And then people could wonder who might run for the Conservatives in his place. 

For now, though, it is still just a rumour.

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Of Death Eaters and Horcruxes

From deep inside the Conservative bunker this past couple of weeks have come one consistent set of stories.

Someone doesn’t want to have a leadership contest.  Whether it is the pressures of time on the party or fear of opening up internal divisions that just won’t heal, Conservative back-room boys have been trying to engineer a coronation.

Until Wednesday, those were just stories.

Then events started to unfold.

A couple of weeks ago, Darin King said he would take the time over Christmas to discuss his political future with family and friends.  Christmas must have come early. 

"My children are not that old — my son's in grade 11, my daughter's in grade 7 — my wife is a full time professional and I'm sure people would appreciate, its very taxing on the family, just time alone that you're away from home," said King.

"To consider taking on another challenge such as this at this point and time for me, it was our conclusion, that it's not in the best interest for us collectively as a family." [via CBC]

Reporters heard about King’s media scrum from a strange source:  Jerome Kennedy.  After announcing he was bowing out of the race because he had two teenage children, Kennedy told reporters that King would be along later with an announcement of his won.

And to confirm that the fix was in, both endorsed Kathy Dunderdale as the leader of the province’s Conservatives.  By default, she gets to remain as Premier.

Now a young family or other unspecified family pressures are usually a genuine explanation of why someone leaves cabinet or even leaves politics altogether. But these aren’t young families.  Both men have teenage children and they got into politics when their children were much younger – that’s the time when a young and needy family would be the reason for someone to stay out of politics.

Wednesday’s announcement by Kennedy and King sounds like  someone who quits a job to spend more time with the kids and then goes after another job that would have him spend less time with the family.  As a story, it just doesn’t hang together.

The stories about a back-room deal only grew stronger as time went by.  If the latest whisperings are true, the back-room manoeuvres involved none other than Danny Williams Hisself.  Williams was the only one who could contain the ambitions of so many for so long.  And as it seems now Williams may have been the one who could convince the ambitious to bide their time a while longer.

There’s no question, though, that someone is working behind the scenes to manoeuvre everyone into a certain position. There might be a few more minor shoes to drop – maybe some staff changes in Kathy’s suite -  but Darin King and Jerome Kennedy made it clear on Wednesday that the fix is in:  it will be Premier Dunderdale leading the Conservatives into the election, whenever it comes.

How long the fix lasts, though, is another question.

Oh…

Just coincidentally, you might have noticed some changes to the government online phone directory lately.  Right at the end of the listings for the Premier’s Office is an interesting entry:



Danny Williams is still listed in the office.  He holds the position of “Premier Dunderdale”.

Makes you wonder.

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Update:  Corrected time references.

Jerome!’s out – Connie Leadership 2011

CBC has confirmed the rumours swirling around for a couple of days.  Jerome! Kennedy – presumptive front-runner to replace Danny Williams – won’t be running for the job.

CBC is also reporting that he’ll announce his intentions publicly next week. Don’t be surprised if Jerome! also indicates he won’t be seeking re-election next fall.  Williams got Kennedy into politics and Kennedy has enjoyed his leading role in cabinet because of his close personal relations to Williams.

Interestingly, Jerome! was one of the two cabinet ministers who hung around with Danny after Danny told cabinet he was quitting.  The other was Tom Marshall.

Marshall is also reportedly considering a run for the job.  As CBC notes, no one is officially in the race. The closest anyone has come is education minister Darin King. Some have suggested Kathy Dunderdale should stay on.

So far no one has asked Joan Burke if she’s interested in the job.  She’s been reputed to have a team in place and some cash in the bank. 

If the Conservatives settle on either Dunderdale or Marshall, the party would be appointing a caretaker who might stay only long enough to see the party through the next election.

Since 1949, incumbent political parties in Newfoundland and Labrador have had no shortage of potential rivals for the top job from the moment it became vacant. This is the first time in 61 years that a party has had apparent difficulty attracting candidates.

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Counter-spinning negativity – Jerome! version

So there’s Jerome! trying to spin the Ottawa speech to Randy Simms over at Open Line.  Big crowd.  Sceptical at first but then slowly realising the truth until a giant standing ovation at the end.

Uh huh.

Right.

Actually, the audience was small, according to reports from some in the room.  Tables packed but a small number of tables spread out in a relatively small room at a hotel where the Canadian Club of Ottawa has been known to jam the place to the rafters for speeches by other premiers from the Far East.

The audience include a bunch of federal politicians from Newfoundland and Labrador, the majority of whom have a track record of jumping when the Old Man barks. They had to show up.

But no giant groundswells of editorial opinion one way or t’other. The media coverage generally was pretty light:  Reuters Africa. roflmao.

What did get coverage?

A fake lake and some ludicrous claim by a couple of people about a political merger conversation that never was.

Face it:  if four inches of water and David Dingwall’s former political staffer make a bigger news hit than a speech by a provincial Premier claiming all sorts of hideous things about another provincial government, you have the definition of a complete public relations disaster.

That’s why Jerome! was torquing so desperately.

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Air ambulance controversy - curious ATIP redaction may hold clue to full story

A briefing note prepared for the province’s health minister in early September 2009 may contain important clues to when a decision was taken to move an air ambulance aircraft from St. Anthony to Goose Bay.

In a section headed “Medical Flight Specialists”, the briefing note points to the problem of putting specially trained medical crews on aircraft outside St. John’s.  That’s the only place a medical flight specialist team exists since the provincial health department created the program in August 2007.  Before 2007, local medical staff accompanied patients being transported to another hospital inside or outside the province by medical evacuation aircraft.

As part of the relocation of one aircraft to goose Bay, the provincial government will train a new medical flight specialist team.  In the meantime, any staff needed for a medical evacuation from Goose Bay would have to originate in St. John’s or travel to St. John’s first and then return to goose Bay.  That’s exactly the problem identified in the September 4, 2009 briefing note regardless of where outside St. John’s the health department based an aircraft.

Note that the final four bullets in that section are deleted.  Three are deleted under a discretionary section of the province’s access to information law  about to advice to a cabinet minister or government body. There’s no indication what that information might be.

But a fourth bullet is deleted because it relates to “plans that relate to the management of personnel of or the administration of a public body and that have not yet been implemented or made public…”.  The province’s access to information allows the head of a department the discretion whether or note to censor that information.  In this case, the department head decided to censor the information.

These deletions are important since they relate to a dispute over when the provincial government decided to move the air ambulance. Both provincial Tories and the Grit opposition have tied the move  - directly or indirectly  - to last fall’s by-election in the district formerly represented by provincial Tory cabinet minister Trevor Taylor.

Taylor resigned unexpectedly last fall.  The provincial Liberals won the by-election held in October. Health care was a major issue in the by-election. In a letter to a local newspaper in the district in May, Taylor tied the by-election to the ambulance relocation.

While the Premier and health minister have denied the connection they have also hinted strongly that further protests by people in Taylor’s former district might lead to other cuts.

Paul Oram, the province’s health minister in September 2009, resigned suddenly in early October, citing ill health.

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Jerome! ducks reporters on medevac fuss

Health minister Jerome Kennedy today refused to answer questions from reporters following his claim that incidents in St. Anthony related to his decision to relocate the air ambulance service had reached the pointed where he was speeding up the relocation.

As CBC reported:

"There has been at least one other incident that has caused us some concern," said Kennedy, who added that the situation in St. Anthony has become so volatile that the government moved up its timetable on relocating the air ambulance service.

But Kennedy would not describe other incidents, and was not available to speak with reporters later.

Kennedy is moving the air ambulance without a trained crew to handle medical evacuations.  As a result, the aircraft will have to fly from its new home in Goose Bay to St. John’s to pick up a crew and then return to carry out the med evac.

The relocation came after two incidents in Labrador where aircraft were unavailable for medevac flights.  Neither incident was connected to the aircraft base location.

In the fall of 2009, for example, a child waited for nine hours while the lone air ambulance then flying made a series of runs to and from Labrador with more urgent patients.  The second of the provincial government’s two medevac aircraft was down for repairs at the time and – apparently – no arrangements had been made for a backup.

Other aircraft were potentially available.  For example, Churchill Falls (Labrador) Corporation – owned 65% by the provincial government’s energy corporation  - owns a B-300 King Air that is both available for charter under certain circumstances and which can be configured for medical evacuation.

In late 2006, entrepreneur Bill Barry tried to interest the provincial government in chartering aircraft from a company he owned at the time to provide medevac service from Deer Lake. It appears nothing came of the idea.

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Kremlinology 14: Dead Caterpillars

Brian Tobin did it.

Roger Grimes did it.

Well, yes both served their political party as leader and served the province as Premier.

But before they became premier, they took the rather obvious step of shaving off a moustache they’d sported for years before.

There’s no coincidence.  As the groomers and other hangers-on start to gather around prospective political leaders, one of the first things they suggest is that the ‘stache has to go.

And go it does if the pol has leadership aspirations.  In countries following the British parliamentary tradition, facial hair on politicians generally – but especially on first ministers – has been out of fashion for a century.

After the fashion changed, along came the rationalisation that people don’t trust their first ministers to have beards or moustaches. There’s probably no empirical evidence to support that but it is there all the same.

And you can be guaranteed the advice will come to a politician who wants to lead anywhere:  shave it off.

It doesn’t matter if the thing works aesthetically.  Take a Gander at Jerome!’s official mug shot. The moustache is neat and well trimmed.  It’s also a natural colour, something St. John’s municipal politicians could notice. The ‘stache also gives him the appearance of having a mouth sized in proportion to his face.

He looks pretty good.

So the only reason he would dump the dead caterpillar – short of some sudden, previously undiagnosed skin condition – is political.

Here’s the new Jerome!, incidentally, in a screen cap from a recent CBC television interview.

The difference is quite striking.

Striking yes, but in some respects a difference brought on by the same limited, unimaginative thinking that wanted to take Trevor Taylor and put him through an Eliza Doolittle kind of sanitizer merely to get rid of his accent.

In Trevor’s case, his accent was not impenetrable and his tendency to use colourful language reinforced his core strength:  he spoke sincerely, honestly and straightforwardly.

In Jerome!’s case, the moustache didn’t really serve as a distraction. What had been working against him was his tendency to speak rapidly and  - when he got excited - to have his voice head for a pitch heard only by dogs. 

Jerome! has evidently been working on speaking more calmly and speaking in the lower part of his range.  All that has helped him immensely and his recent performance in the new portfolio has been extremely good.

But getting rid of the moustache?  That’s probably the least of his worries.

The only thing Jerome and his handlers have done is sent an unmistakeable signal that he wants to be Premier.

Oh yes.

Mustn’t forget.

And that he might get a chance at the job sooner than people think.

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Kennedy on Straits by-election: Hail Mary!

Guess what?

Lab and x-ray service is staying in Flower’s Cove.

Former finance minister Jerome Kennedy announced the decision today on voice of the cabinet minister’s morning call-in show.

The Tory candidate must not be doing too well in the by-election.

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Oil and the budget

The provincial government seems to be in one of those strange places it goes every now and then.

It’s a world where the messages are decidedly mixed, if one picks a generous way to describe it.

Totally confused would be another way of saying there are two completely contradictory messages rolling at the same time.

Both of them are coming from the current finance minister who is also a former finance minister and notorious for running an open cheque-book department.

In the latest incarnation, Tom Marshall is seen supporting a CBC news story that rising oil prices are wiping out the projected government deficit.

Just yesterday it was a tale of looming financial woes. Tom Marshall even repeated the message that government spending  - i.e. the spending he oversaw in the job before - is unsustainable. 

In the CBC story, though, Marshall tries desperately to avoid giving any firm indication of the province’s current financial state:

If the price averages $70 a barrel for the entire year, it could wipe out the provincial deficit, but Marshall cautions against such predictions yet.

"It's not just the price," he said. "It's the volume. It's the exchange rate and of course we don't know what's going to happen in the future in terms of production numbers."

There are a couple of things to note here.

First of all, Marshall knows exactly where things are at this, the midpoint in the fiscal year.  he also knows where things are likely to wind up within a relatively narrow range of possibilities.  Marshall just didn’t want to share, even if CBC actually asked, and he likely won’t share until December if recent practice holds firm.

Of course, there’s a reason why the government holds on to information.  They clam up so that people who ought to have accurate information can’t get it, but that’s another issue. 

Second of all, we can fill in some numbers but not others. 

The stuff we are missing includes revenue figures like sales tax, mineral royalties and personal income tax.   If those are lower than expected, then it would take more than high oil prices to deliver a balanced budget. It’s unlikely those figures will turn out lower than estimated since the finance department routinely low-ball revenues these days.  But still, we don’t know because they aren’t saying.

We also don’t know what government spending is actually like. Operational spending may be up or it may be down.  Ditto the capital budget, or the “stimulus” as it is known currently.  If projects are behind schedule or delayed – as many are – then the cash budgeted for those projects will reduce the overall spending part of the budget.  A healthy chunk of the massive surplus in the last couples of years has been coming from forecast spending that just never happened and wound up not happening for two or three budgets.

As for oil, we can get a fairly good idea of what that looks like. 

Price is one element.  The 2009 budget used a figure of US$50 a barrel and an exchange rate that put oil at the equivalent of around Cdn$60.  Oil is currently almost $20 a barrel higher than that, even allowing for the lower exchange rate with the American dollar.

Production is another element.  Last year, oil production exceeded 125 million barrels.  This year, the provincial budget used a figure of  98.5 million barrels or a decline of  21%.  As it stands right now production in the first five months of the fiscal year is down about 27% compared to last year.  A 27% drop in production would mean a total production of about 93.75 million barrels.

But that’s not the whole oil picture.

The other bit is the percentage of each barrel the treasury gets and neither the budget documents last March nor Tom Marshall these days will talk about that publicly either. 

Thanks to the 19 year old Hibernia royalty regime, the provincial government take at Hibernia jumped to between 30% and 42.5% this year when the project hit pay-out.  Terra Nova and White Rose are already in pay-out and are pumping 30% royalty rates based on the original royalty regimes from before 2003.

And that’s where it gets interesting.

The budget figures don’t appear to include the higher royalty rates. factor those in and even the lower production total of 93 million barrels would produce provincial royalties of at least $1.9 billion. When your humble e-scribbler ran the numbers in August - estimating the revenues from each project -  the figure came out about the same as last year’s oil royalty. 

What all this means is that even allowing for some variation in other revenues and in overall spending, the books will likely be balanced this year on an accrual basis even at the low-end estimate.  On a cash basis there would a shortfall;  the budget forecast $1.3 billion. 

On the upper end, the forecast accrual deficit would turn into a surplus of something on the order of $500 million.  On a cash basis, the books would be balanced.

All in all, though, one must wonder why there is some much confusion coming from the current and former finance minister(s).  They could be letting the rest of is on their own projections since, the only negotiations going on right now are with voters.

Voters have a right to know how their own finances are looking, don’t they?

Oh yes.

And let’s not forget in all this that the budget last year included $1.8 billion in temporary investments that no one wanted to draw any attention to.

Makes you wonder why Tom and Jerome and Danny have been putting on the poor mouth again, even if just for a minute now and then.

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Dumb and Dumber, the fin min version

Reborn finance minister Tom “Marshall's challenge now is balancing declining revenues against increasing needs” to quote the Telegram story from today’s from page.

He said the key is "spending wiser, and spending smarter."

Okay, sez your humble e-scribbler, so does that means Marshall’s previous tenure as finance minister involved spending dumb and dumber?

Interesting line to take during a by-election, incidentally.  Cuts to spending by Marshall’s predecessor are what got the governing party into this by-election in the first place.  Jerome! Kennedy the high-pitched predecessor – now the higher pitched health minister – has been busily backtracking on the cuts Marshall, Kennedy and their boss approved in cabinet.

Curious.

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Jerome! gets his dream job

Jerome Kennedy is the new health minister.

There was talk a year or so ago that Kennedy was anxious to move into the high pressure job as a way of proving himself on the way to the Eighth Floor.

He didn’t get his wish at the time, what with the Premier stuffing him in finance instead.

Well, a short while later Jerome got his dream job.

And he won’t have quite the same commute as his predecessors did when cabinet meetings were on.

Interestingly enough, the Premier didn’t take the opportunity to replace Trevor Taylor who quit last week.

Instead, the acting minister of transportation will carry on.  Tom Marshall will go back to finance and Felix Collins will get the minister’s job in justice.

There won’t be a permanent replacement for Trevor until some unspecified time later, apparently.

Curious.

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We’re more than a bit sceptical too, Jerome.

Finance minister Jerome Kennedy, quoted in the Friday Telegram:

"I'm have to tell you, I'm a bit skeptical, (Prime Minister Stephen Harper) indicates that 3,000 infrastructure projects across the country are underway," he said.

"Really, at the end of the day, there may be commitments on the part of the federal government, but what's taking place in this province is as a result of our government aggressively pursuing and accelerating this infrastructure strategy."

Hmmm.

By accelerating, that would mean finishing off stuff either started or promised up to four years ago, Jerome?

Like say half the stuff Kennedy listed in his blockbuster update which in no way insulted the premier’s sensibilities about announcing and re-announcing money that had been announced upwards of seven times before in some cases?

Or would that be taking credit for more than the government was really doing, another thing Provincial Conservative Kennedy accused the federal Conservatives of doing?

Like $800 million in new infrastructure spending  - on top of the $800 million already committed for this year – some of which is cost-shared with Ottawa. That would be stuff that isn’t budgeted even though it is supposed to go out before the end of the current fiscal year.

Presumably that acceleration would be what provincial transportation minister Trevor Taylor was talking about yesterday:

"So this year, when the Federal Government offered economic stimulus money, we already had our priority list identified. We had been proactive and our sound strategic planning allowed us to move forward with a series of significant projects very smoothly.

Okay.

So we know Jerome, Trevor and da b’ys really weren’t ahead of the game since half of what they tossed out has been in the works for years.  One project committed in 2007 and promised to be delivered in 2009 just went to tender the other day.

Not really ahead of the game, are we, hmmm?

But with that to one side, surely Trevor and Jerome already inked the deal with the feds for that new money set to flow later this year.

Apparently not.

Federal finance leprechaun Jim Flaherty told CTV’s Jane Taber the other day that:

We have agreements with almost everybody, not yet with Newfoundland and Labrador.

But if Newfoundland and Labrador already had their list together, why didn’t they sign the agreement yet?

Maybe Jerome  - the guy who didn’t know what the Clerk of the legislature did – was just too busy doing something else to read his infrastructure stimulus briefing notes on the new agreement so he could sign the thing. 

Jerome was right about one thing, though:  all the talk of commitments without actually getting anything built would make anyone sceptical. 

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