14 March 2005

Danny Deficit Billions?

If Loyola Sullivan's worst case scenario comes true, Danny Williams will increase the province's accrual debt by an amount that is 76% of the total direct debt since Confederation.

Loyola Sullivan never flings words around carelessly, especially when it comes to numbers. He has a love of numbers and decimals and fractions that even a mathematician or account would find perverse. So if Loyola actually told CBC Radio on Friday that the accrual debt could hit $17.0 billion then $17.0 billion is well within the range of possibilities.

Let's take another look at Loyola Sullivan's deficit and debt projections and put it in perspective.

He told CBC Radio that "We're going to have significantly more [debt] over the next number of years," he says.

"We're going to have [a] $14-, $15-, $16-, maybe $17-billion debt before we stop this. So, it's a huge problem. Our problem is still growing." That is a direct quote.

If government was able to reduce the accrual deficit from its current level of about $500 million down to zero (a completely balanced budget) in the next four years, the provincial government would add $2.0 billion to the debt. The total debt at the end would be around $14.0 billion, up from the current level of near $12.0 billion.

(Deficit is how much more we spend than we take in during any given year; debt is the accumulation of all the overspending and any other long term borrowing. Direct debt is what the government owes directly. Accrual debt is the total of everything owed by government and its agencies and any loan guarantees and other liabilities backed by the Crown.)

In order to hit that $17.0 billion figure we would have to increase the debt by $5.0 billion. In other words, we would have to incur annual deficits averaging $500 million for another decade.

Observation 1: In order to hit that number for the debt, it would be 2014 at the earliest before the provincial budget would be balanced.

The Commitments:

A. The Budget. In last year's budget, Loyola Sullivan was careful to commit to balancing the books on a cash basis only by 2007-08. He said that "[i]n March 2007, this government will present the people of this province with a budget that is balanced on a cash basis and that will be sustainable into the future."

B. The Blue Book. Loyola Sullivan made reference to the Blue Book commitments in that speech. Specifically, the commitment was to:

- Eliminate the total capital and current account deficit by 2008;
- [Achieve] a net debt to GDP ratio of 40% or less by 2008; and ,
- [Make] [a]nnual payments to the public sector pension funds that will achieve real year-over-year reductions in the unfunded liability of public sector pension plans.

PriceWaterHouse Coopers comments: The Gourley report made the claim that the province could not balance its current and capital account by the same period. These are not exactly the same thing. "Cash" is sometimes used interchangeably with "current" meaning the money spent for salaries and operations.

On that basis the budget is already balanced and should remain balanced if not in surplus for the next five to eight years. As PriceWaterHouseCoopers reports (p. 34):

"These projections show that even with an assumed level of restraint on expenditure growth and growth in oil related revenues from a forecast $160.1 million for 2003-04 to $491.9 million in 2007-08, it will not be possible to eliminate the Province’s cash or consolidated accrual deficits within the next four years."

Assessment 1: There are contradictions between the Blue Book and current government commitments.

The current account has been balanced already consistent with Blue Book and the last budget.

However, the budget speech only committed clearly to balancing current account. There is no commitment to balancing the capital account nor is there a clear commitment to carrying through on the Blue Book promise of tackling the unfunded pension liabilities.

Mr. Sullivan's comments to CBC suggest yet another set of fiscal commitments that do not resemble those made previously except in broad outline.

Based on Mr. Sullivan's comments, government does not intend to reduce the unfunded pension liability in the short- to medium- term. It will also not achieve its commitment to balance the current and capital accounts before the next election. In fact, government may take up to a decade to achieve a balanced budget despite a commitment to attain current and capital balance within four years and achieve "real" reductions in the accrual debt and deficit.

Observation 2: In 2014, there will be less revenue life left in the offshore than we have now. That means the province will balance the books and have all the debt servicing costs associated with that at the very point when provincial government offshore revenues will start to decline.

Go back and have a look at the offshore revenue projections Wade Locke made in his public presentation in February. Locke projected that in 2014, direct offshore revenue would be slightly more than $200 million and would decline annually until 2025. Compare that to 2007/08 when projections have oil revenue being between $600 million and $1.1 billion, depending on the price of oil per barrel.

Observation 3: The current provincial government direct debt is approximately $6.5 billion according to statements from the provincial department of Finance.

In Mr. Sullivan's' worst case scenario (accrual debt = $17.0 billion by 2014), the provincial government debt during the Williams administration would grow by an amount equal to 76% of the accumulated direct debt from 1949 to 2004.

I am still sitting here with mouth agape at the prospect that the provincial government might actually be that far away from its commitments last year.

Maybe Loyola didn't mean it.

But did he not mean what he said last Friday or what he said last year?

Loyola Sullivan's Credibility Gap: Welcome to the Grand Canyon

It is possible the CBC story actually misquotes Loyola, but I don't think so.

Let's compare the claims Loyola makes and compare them to the facts

Claim 1: "Starting with its first budget last March, the Williams government has changed the way it reckons its books.

Last year's projection, for instance, included the cash or current account deficit of $362 million, which traditionally has been the only figure governments have reported as its deficit.

However, the Tories now included all liabilities, including pension deficits."

This is CBC background but it reinforces the general tone of Loyola's comments. These aren't Loyola's errors directly but they increase the errors of Loyola's actual comments by putting them in a false context.

Fact: The provincial government switched to accrual accounting two fiscal years before the Williams administration took office. Those projections included all liabilities, including pension deficits.

Fact: There was nothing new in last year's budget figures.

Fact: The $362 million cash shortfall Loyola predicted was wiped out by economic growth including oil price windfalls.

Fact: The 2004 accrual deficit will be closer to $500 million, almost half the amount projected in March 2004.

Claim 2: "Sullivan says it would be impossible to balance the budget in the next three to four years without deep cuts to government spending.

Instead, he expects the deficit to hover at around $500 million for at least a few more years."

Fact: Provincial government revenues will increase annually for the foreseeable future.

Fact: The provincial government's own projections show oil revenues in Fiscal Year 2006 will be at least $600 million. That's three times current annual revenues.

Therefore, it should be possible to balance the province's books on an accrual basis without "massive cuts" to spending.

Claim 3: "That could change, he says, if oil prices soar and government revenues increase.

However, Sullivan says the debt will continue to grow, no matter what happens."

Fact: the ONLY way that the debt will continue to grow despite revenue increases will be if the provincial government fails to address the deficit and debt as it pledged in the Blue Print AND it increases spending in the meantime.

Fact: Oil prices are expected to remain at high levels, therefore increasing provincial government revenues beyond the projections used in the first six months of 2004.

Fact: The federal government has already announced increases to federal transfers in addition to the January offshore deal.

Fact: Voisey's Bay and White Rose will begin production within the next three years increasing government revenues by hundreds of millions of dollars annually.

Fact: Hebron-Ben Nevis will likely be brought onstream before 2010, further increasing government revenue. Development spending will increase government revenue before the field comes on stream.

Claim 4: "In particular, he says the government needs to spend money on infrastructure to help the economy and to boost government revenue."

Fact: There is a need to spend money on infrastructure like roads and schools.

Fact: This spending is designed to correct previous neglect, not to help the economy. The economy is thriving largely due to resource developments that are not dependent on infrastructure spending.

Fact: Government spending on infrastructure will not boost government revenues. [Let's allow that this sentence is an error by the CBC webpage writer. Maybe the increased government revenues is something else the government needs to do besides spend on infrastructure. As anyone can see, though, government revenues will increase anyway.]

Loyola's Brush: Sullivan signals return to Tobinism

Be afraid.

Be very afraid.

In a CBC Radio story this morning, finance minister Loyola Sullivan, newly stripped by the Premier of his spine - read Flo Delaney, is now warning the people of the province that the government's debt will continue to spiral unchecked under the Progressive Conservatives.

Sullivan is warning that the government's accrual deficit (the difference between revenue and spending) will hover around $500 million for each of the next three years. That adds another $1.5 billion to the province's debt and will eat up every single nickel of the money so lavishly worshipped in the recent Valentine's Day offshore deal celebrations.

Holy Cow.

Think about it this way:

- Sullivan predicted last year that the cash shortfall would be almost $400 million this year alone, with an all-inclusive deficit of a little over $900 million.

- Through a combination of spending restraint, economic growth and windfalls from increased oil prices, the provincial government is expected to post a modest surplus on a cash basis this year. The only thing seriously out of whack in the provincial government's budget will remain the unfunded pension liabilities found chiefly in the teacher's pension fund.

That represents a changed cash flow of almost $700 million, seemingly the largest error in provincial government budget calculations in more than 15 years.


- These huge deficits are projected to come at a time when oil revenues will hit their peak - almost $1.0 billion by some projections - and at a time when the new oil deal will continue to ship federal transfers to the province.

- These huge deficits will occur despite added revenues from White Rose and Voisey's Bay, both of which come on stream within the next three years. The deficits will occur despite the likelihood Hebron Ben Nevis will start swelling government coffers before the decade is out.

In other words:

despite massive record-setting increases in the provincial government record-high revenue - even without the extra $2.0 billion from Ottawa - Loyola Sullivan is warning that we will continue to run record deficits and add to our already record-high debt load.

Sullivan's comments today signal an end to the restraint program announced last year in the Premier's hideous January 5 speech. A seeming long-term program to sort out the provincial government's eternal fiscal problems has been abandoned at the end of Year One.

Instead, there seems to be a return to Tobinesque spending on short-term projects designed primarily to boost the government's (read the Premier's) political popularity.

It sounds like the provincial government isn't going to expend a single penny on fighting the unfunded pension liabilities. Government could set aside an amount from the oil money in a pension fund which would progressively reduce the unfunded liability, even if it did not wipe it out altogether and even in the absence of an agreement with teachers. Make no mistake though teachers are going to have to ante up and help fix their pension problems. Danny Williams should be applying his considerable power to tackling those labour problems, as unpopular as that may make him.

That would be a start and would lower the projected deficit without consuming all the new money flowing.

This is unthinkable.

If Loyola Sullivan wants to be truly accountable, he would release some detailed financial projections with his new budget. We need to see all the figures he has access to. We need to see the basis on which government is making its projections. Then, during his next round of budget "consultations", he might get a rude shock.

The "consultations" might actual contain some concrete directions from his real boss - the voters - as to what he should be doing in order to keep his job.

If Loyola thinks people turned on Brian Tobin after they'd had a good look at thim, wait 'til they get a hard look at a bunch of guys that have more money than anybody else running the place ever had and still manage to spend more and more and more besides.

11 March 2005

Buffing a TRD

On a snowy Friday in March, a few days before the House is due to re-open Danny Williams decides to shuffle around a couple of portfolios. Here's the release, in all its flatulent splendor.

Trevor Taylor gives up Labrador Affairs to Paul Shelley, who gains new responsibilities because, as the release says, Paul has "deep roots" in the Big Land.

Trevor apparently has big challenges in fisheries and aquaculture, meaning that he is taking flack for the recent crab business, the sideways shuffle of a policy that was an apt metaphor for the species it affected.

At the same time, the Minister of Justice gets to take Intergovernmental Affairs. Ostensibly meaning - the release claims - this change allows the Premier to devote more time to other things like the Department of Business.

This little creation, you may recall, has sat moribund for the entire time the Tories have been in office. It still exists without a deputy minister or assistant deputy and, as near as anyone can figure out, any defined purpose that is different from anything that has gone before.

The only major departmental initiative to date appears to have been handing over almost $100, 000 to a local marketing firm to do some baseline research on attitudes to the province. It was undoubtedly good work done by an excellent firm but one must look askance at the lack of productivity of this department.

Business as a department of its own (acronym DBus, pronounced "Dee Bus") duplicates the work of Innovation, Trade and Rural Development - with the acronym InTRD - formerly Industry, Trade and Rural Development, with the acronym ITRD or as I preferred DITRD. [Wags out there will stick a "u" between the "t" and the "r" to get the full sound of both acronyms, but I digress. Sometimes acronyms are inadvertently meaningful.]

The DBus budget consists essentially of the money formerly allocated to the "Manufactured Right Here" promotion in InTRD. No surprise therefore that its major project in the coming months is likely to be... wait for it...a promotion campaign to "brand" the province in the investment sector on the mainland. For that, we need a minister (the Premier) and a whole departmental apparatus. Pull the other one; it's got bells on it.

If this shuffle is about productivity and focus, I'll make a simple observation that might produce a greater result than debussing the Premier from IGA.

My observation is even more substantial that having ministers and their staffs actually working rather than paying attention to Open Line and then calling in to comment on something. Surely to goodness the Premier can communicate more effectively with the people of the province than by calling an open line program like say...the Moon Man or Sue used to do. Surely there are better uses for political staff than sitting by their radios for upwards of six hours a day on the off chance Joe from Bung Hole Tickle will call and complain about the government.

People complain about government like they breathe. Government in this province started to get less productive after the arrival of Brian Tobin, when he and his crowd started spending more time working the phones to Bill and George rather than trying to get some work done. Danny and his crowd seem to be following suit.

That said, I am going to hang my blogger hat on a more substantial issue. If you take this release at face value, the DBus has been lagging because the Premier has been preoccupied with other things, like the offshore oil talks. That's an admission of what I have said before. The time-management and productivity problem of this government sits solely in the Premier's own lap. Danny Williams has injected himself into anything and everything he could whenever he could. As a consequence, the government has been dealing with issues in series rather than in parallel.

As I noted in the post "Ed Byrne Redux", the Premier needs to take his hands off files that properly belong to his ministers and let his ministers work them.

It is time for a New Approach, Danny. In fact, it's eighteen months past due. This minor shuffle can't fix one of the fundamental problems on The Hill. Even if Tom Marshall is the new IGA minister, everyone knows that the Premier will still be speaking on, acting on and otherwise working files that Tom would be capable of handling himself. Or Danny will be working stuff from Natural Resources, Fisheries, Aboriginal Affairs, Health or anything else that catches his or the media's attention.

The New Approach was supposed to be more than a novel use of the shift key.

Getting more productive activity out of this government will take more than changing the names of ministers on departmental letterhead.

There's an old saying in the public relations business that you can't buff a t*rd. It means that no amount of "spin" or flatulent writing can cover over what everone else can see. It's like murdering both your parents and then calling for mercy because you're an orphan.

Shuffling around a couple of portfolios doesn't get at the root of the productivity challenge.

This release seems to be applying some Kiwi and spit instead.

10 March 2005

Paul Martin invests in Labrador, not Danny Williams

There was some reason behind Danny Williams' hastily organized road trip to Labrador this week involving the whole cabinet and a gigantic news conference of cash announcements.

There was a reason...

but damned if I can figure out what it was.

Nor, as I have discovered can anyone else I know offer a theoretically possible explanation that doesn't involve a misalignment of celestial bodies.

The best theory goes that it had something to do with the upcoming federal by-election. Problem for me on that one is that Danny Williams doesn't get any value of putting someone in the federal caucus of a party he doesn't support when he already holds sway over every MP from here save one and a good few of the senators from this province already.

Plus, Danny's man - which ever one gets the Tory nod - doesn't stand much of a chance of getting elected in Labrador anyway.

The story of the Labrador road trip gets ever stranger though, when you take into account Rob Antle's front page story in today's Telegram. I have linked to the Telly website but Miller didn't post Rob's story there today. Instead, I am reprinting it below.

It turns out that all but $3.0 million of the $56 million announced by Danny Williams comes courtesy of Ottawa.

And...

It seems most of the projects involved have been announced at least once before, some as recently as a couple of weeks ago.

D'0h!

Add this trip to your Homer Simpson file.

Before we get to the Antle piece, I'll toss out some observations:

1. John Efford needs to take a hard look around him and ask the great Dr. Phil question: "Is this working for you?" Every successful one of John's predecessors never let a nickel of federal money get spent anywhere in the province without the very coins themselves bearing a tag reading "Courtesy of Ottawa". If John wants to rebuild his image that he tarnished so badly during the recent Accord episode he need look no farther than these sorts of announcements.

Get a grip, John.

2. Danny Williams has evidently been listening to his long-time golfing buddy Brian Tobin. The current Premier's short-lived predecessor was fond of announcing an announcement that announced an announcement of something began to be announced originally a year beforehand. His record may be six news releases and news conferences on a single action, but I stand to be corrected on the exact number.

Incidentally, Tobin was once described as not knowing much about free trade, for example, but being able to smell a headline a mile away. See Greg Weston's account of the Turner tenure as Prime Minister and Leader Opp for the full story. Reign of error, (Toronto: MacGraw-Hill Ryerson, 1988), pp. 142-143

This Labrador trip has Brian Tobin's fingerprints all over it.

3. While this gaff isn't as damaging as some of the stuff we saw a year ago, it seems that Tobin...err...Williams and his political staff still have some fundamental difficulties with getting the basics right.

Surely someone knew that this money was old and Federal and previously announced. No one saw this coming? Who thought the public was that stupid? Hands up.

If the whole thing was one of The Boss' Manic Monday Moments, surely to heavens there is somebody on the Hill who can talk him in off the ledge.

I just shake my head sometimes in utter disbelief. Don't even get me started on the announcement today of a paltry sum to handle school renovations and repairs that appears to have been timed purely in reaction to the last flooding of a St. John's area school that has already flooded once already since January.

Anyway, here's the story by Rob Antle.

All I can say is that while we may have woken up to find ourselves in a one party state, but at least it is entertaining.

Now all we have to do is see if there is a matinee on Sunday.

Text begins...

"Old cash in Williams' speech"
by Rob Antle
The Telegram

Page A1

The Williams administration previously announced plans to spend most of the $56 million it portrayed as new money for Labrador this week.

And the vast majority of the money comes from federal, not provincial, sources.

"Today I am announcing a 2005-06 investment of $56 million to improve access to health services, strengthen aboriginal communities, build and repair infrastructure and expand economic opportunities," Premier Danny Williams said in a news release Tuesday.

"This is the strongest signal yet that government intends to see Labrador thrive and prosper, and to see Labradorians enjoy the same standard of living enjoyed by residents living on the island."

What Williams didn't say is that government previously announced $31 million of that $56-million total six months earlier.

In September 2004, the province said it would spend $35 million to kick-start Phase 3 of the Trans-Labrador Highway.

In Happy Valley-Goose Bay Tuesday, Williams announced $40 million in spending on Phase 3 of the highway - with, he acknowledged, some "carry-overs" from the previous year.

But those "carry-overs" amounted to $31 million, or 78 per cent of the $40-million total.

Department of Transportation officials confirmed Wednesday that new, unannounced, work will account for only $9 million of the money spent in 2005-06.

Elizabeth Matthews, a spokeswoman for Williams, downplayed the discrepancy.

"As the premier stated yesterday, some of these funds are carried from last year," she said in a statement late Wednesday.

Matthews instead highlighted the positive aspects of other funding announced by Williams, such as money for social programs and other infrastructure.

Some of those infrastructure projects have already seen the light of the government news wire as well.

On Feb. 22, the province announced millions in multi-year capital works funding for Wabush and Labrador City - totals that appeared to be included in the $56-million tally unveiled Tuesday.

And most of the money involved is actually federal cash.

Every dime of the $40 million announced for Labrador highway work is from Ottawa.

It is the remaining cash in the Labrador Transportation Initiative Fund - the $340-million, one-time buyout from Ottawa accepted in 1997 by the Tobin administration for taking over responsibility of the Labrador ferry system.

Some $13.3 million of the remaining $16 million comes from various infrastructure funds.

The province offered no specific breakdowns on what money will come from which fund. But most of the programs are cost-shared, with the province picking up anywhere from about 30 per cent to 70 per cent of the overall tab.

The remaining total of about $3 million is broken down into a number of smaller initiatives.

Those include $167,000 for Labrador West residents traveling to Goose Bay for medical care, $200,000 for a hospital infrastructure assessment, $500,000 for the 2006 Labrador Winter Games and $70,000 to reopen a group home.

The Opposition critic for Labrador affairs dismissed many of the funding announcements as recycled news.

"After reviewing the number of announcements yesterday, it appears many of these initiatives were already announced or are being supplemented by federal money," Cartwright-L'Anse au Clair MHA Yvonne Jones said in a statement.

"There seems to be very little in the way of new announcements and many of the pressing needs and priorities of Labradorians were completely ignored."

Jones pointed specifically at the roads funding as an example.

"Premier Williams is trying to convince people that he announced $40 million for the Trans Labrador Highway," Jones said. "In actual fact, this money was announced years ago and is coming directly from the Labrador transportation fund.

"This is nothing more than an attempt by the premier to be seen investing new money in Labrador, when in actual fact, he is bribing the people of Labrador with their own money."

Labrador could be the site of at least one provincial by-election within months.

Two MHAs - Jones and Wally Andersen of Torngat Mountains - are contesting the federal Liberal nomination for Labrador.

If either wins the nomination, they would have to resign their provincial seat.

Andersen has also been linked to a potential role in the new Inuit government of Nunatsiavut.

The potential for another Labrador by-election was averted this week when Labrador West MHA Randy Collins said he would not run federally for the New Democrats.

Collins said in an interview that many people in his district have a positive reaction to this week's funding announcements.

He pointed to health-care money targeted at Labrador West. "I'm pleased to see that (the premier) kept that commitment."

He added, "Always, you'd like to see more."

Text ends.

What was the frequency Kenneth?

Dan Rather is gone and all the mushy tributes have been paid to him.

See ya later buddy.

Personally, I never found him of much use either as a reporter or an anchor. His retort to Nixon, overplayed yesterday was the kind of snotty, rude comment that brought reporters into disrepute. Worse still, it didn't even make any sense. It was a stupid remark, devoid of any sign of intelligence.

Rather injected himself and artificial drama into his reporting to the point where, as many pointed out, he became the story. When he cried on Letterman, there went a moment that Letterman on another network would have ripped to shreds. Too bad Rather managed to hang on long enough to pass the "Icon" threshold. American media Icons are judged by age, not ability, obviously.

My favourite Dan Rather story is still the one from the mugging back in New York in the 80s. In his statement to police, Rather claimed his attackers yelled one of two things:

- Give us all your money? or
- What is the frequency, Kenneth?

I haven't figured it out yet, but that idiotic statement to police about Kenneth seems to epitomize Dan Rather as reporter and Dan Rather as anchor of a major network's nightly newscast for a quarter of a century. Ponder the weight and implication of that for a while. Think of all the poor sods who only listened to Rather.

Thank heavens CBS has put a solid journalist in the anchor chair full time for the first time in 25 years, in the person of Bob Schieffer.

But why do I think the permanent Rather replacement is gonna be John Roberts, known to Canadians by his real name, MuchMusic VJ J.D. Roberts?

Hmm.

If they want a woman, I hear Erica Ehm is looking for steady work.

-30-

Postscript -

Ok. So after I wrote this I decided to flip over to CBS.com and see what JD's bio actually says.

It is laughable.

"Prior to joining CBS News, Roberts had been co-anchor of "Canada A.M," CTV's top-rated morning news program (1990-92) and an anchor/correspondent at WCIX-TV (now WFOR-TV), the CBS Owned station in Miami (1989-90). He also served as an anchor and correspondent for several broadcasts of City TV in Toronto (1979-89)."

Several broadcasts???? As in one or two appearances over a 10 year period?

Here's a better link to J.D. when he wasn't the airbrushed, carefully coiffed virtual talking head he has become. Here's another picture of J.D. from the old days for good measure.

Be proud of your past, J.D. It could be the funky background that could open up the anchor desk to you on a network desperate to recover from the s***-knocking Rather gave to their credibility just before he bailed out.

Imagine handling the news like Much does from their open studio/office concept.

Wooooo.

Radical.

A job for J.D.

Not for John. (The No Anchor concept)

09 March 2005

Resistance is futile. You will be assimilated.

John Hamm is enjoying a bump from the offshore deal too. Here's the story on the CRA poll for Nova Scotia as reported by the Chronicle-Herald in Halifax. (Known to some as the Chronically Horrid)

But here's the difference:

Hamm's satisfaction level is around 69% - people are pretty happy with the job he is doing.

His voter support is 38%, just 8 percent ahead of the Nova Scotia Liberals.

The largest part of this discrepancy comes from the length of time Nova Scotians have been governed by Tories. Voters are a little tired of the Progressive Conservatives. Undoubtedly, there are other causes that would explain the problem John Hamm is obviously having in translating satisfaction with his performance into potential votes at the polls.

By contrast, in Newfoundland and Labrador, Danny Williams is still popular enough to run the risk of obliterating the Opposition parties entirely in an election held today.

What would be lost if there were no Opposition parties in Newfoundland and Labrador?

For the Tories, a one party state would make it easier for Danny to get his way. His contemptuous attitude toward the legislature is well known and some of his officials have been known to ask out loud - maybe facetiously; I suspect seriously - why there has to be anything other than an election every once in a while. Shut the House. Save a bundle.

As for the other parties, I find myself asking more and more what exactly distinguishes Liberals from Tories or indeed New Democrats from Tories. On the Atlantic Accord, all three parties agreed on everything. Roger Grimes is smiling through the latest dismal poll claiming that it was just a comment on the Accord and that everyone supported Danny anyway.

I'll just say two words: graveyard. whistling. You work it out.

So what is the difference?

I don't believe there is one in the current incarnation of the parties.

Roger Grimes mused last year that the province needed all seven MPs in Ottawa to vote as a group on issues. Roger wants our own Block-Heads to match the Bloc Heads from Quebec. Well, he has his wish. In Ottawa, the only MP not voting with the herd is John Efford and that may be solely because he likes his car and driver more than because he has a philosophical difference of opinion with Matthews, Doyle and Hearn on the one hand or Scott Simms and Gerry Byrne on the other.

On the provincial level, things are much the same. The Tories are nationalist or sort of nationalist. Grimes is the guy who blew $2.0 million of public money funding Danny's election platform, otherwise known as the Vic Young Royal Commission. Try sliding a piece of paper between the policy manuals from the Liberals or the Tories from the last election. Try to find a major Liberal policy initiative that the Tories haven't implemented in their first 18 months in office, haven't continued or haven't got under serious consideration.

Try to figure out why the provincial Liberals put forward a motion in Ottawa last week seeking ownership of the offshore - a long-standing nationalist fantasy - even though the matter was settled legally and practically 20 years ago. We may not own it but we reap all the benefits anyways - yet Roger and his 40 fellows pushed a resolution that would do what exactly? I dare you to spot a difference between Brian Peckford and the guys who put the resolution together.

In the upcoming budget, I suspect you are going to see the Conservatives move in a direction reminiscent of the Tobin Liberals; at the very least, they'll be investing in social programs, while ramping down the chatter about budget cuts and freezes. Expect to see less of Loyola now that Flo has gone.

Danny Williams supports same sex marriage as a matter of principle. Grimes does and he doesn't all at the same time.

My own father, staunch Liberal that he is, asked me last night why I picked on Roger Grimes in yesterday's poll post.

Well, I am not.

I am simply making a point and Roger just happens to be the leader of a group of people who largely share the same views which just happen to be the same as pretty well every other party in Newfoundland and Labrador politics.

So now, I'll go a step farther and ask why we have three political parties if they all say the same thing?

Democracy is based on choices.

Our particular system of parliamentary democracy depends on having opposition parties that put forward reasoned alternatives to government policies and programs.

As far as I can see right now, Newfoundland and Labrador has become a one party state, by default.

Somehow, we wound up with DannyJackandRoger from the Block.

[Don't be fooled by the votes that we got/We're still DannyJackandRoger from the Block/We seem different, but then maybe not/Things are all the same here on the Rock]

Why exactly do we have three political parties all claiming cash from the public treasury?

Why do we have a legislature?

08 March 2005

Polls and the stuff they tell you - amended

Undoubtedly there will be much comment today on the latest quarterly survey by Corporate Research Associates showing the Williams government with support of 86% of those surveyed.

The CBC radio story is already up, but there isn't anything on the CRA website [as of the original posting] which is a shame. There's a story on VOCM and another in the Telly. CRA's original news release actually shows the detailed responses compared over the past four quarters, which can be useful. [You can find the CRA release linked from the CBC story.]

That said, here are some early morning observations on the CBC report. I'll update this if something more interesting emerges from the CRA release itself.

1. The high approval rating for the Williams administration is hardly surprising. I wouldn't be surprised if the government's own private polling shows numbers much higher between November and January. They had a popular issue driving public support and virtually no opposition or critical comment coming from anywhere, including the opposition parties.

2. The rating reflects an upward trend for the past three quarters as reaction to the budget faded away. The budget and the government's early poor performance was something that wasn't likely to last anyway. As with Tobin and the school reform issue, the Williams administration capitalized on an issue that was framed to appeal to a wide segment of the public. They handled the file well politically and the CRA polling numbers reflect that.

Let's see what the numbers are like after the budget and let's see how government handles the budget in a couple of weeks. I suspect we will not be seeing a continuation of the budget restraint promised last spring. Politicians like big positive polling numbers.

3. Williams personal numbers are back up in the range he has enjoyed for most of his time in politics. Again, the drops last year were linked to another specific issue - namely the budget. It isn't surprising that his personal numbers are back up in the wake of the offshore deal.

4. The PC gains have come primarily at the expense of the Liberals. PC voter preference is at 74%. NDP support is down three points, well within the poll's margin of error; Liberals dropped from 28% to 17%.

5. The poll should be a wake-up call for Roger Grimes personally and for the Liberal Party. For the party, their overall lacklustre performance is reflected in the CRA polls over time. Their jump last year was not linked to their performance as much as it was to dissatisfaction with the government. If the Liberals wanted to hang on to those numbers then thy needed to earn them. They could have earned them by presenting a credible alternative government and by mounting sharp focused attacks on the Williams administration.

If any political opposition waits around for a government to self-destruct, they are in for a long wait. Just ask Danny Williams and the Tories. The Liberals have been working 11 individual districts strategies instead of an integrated strategy designed to present themselves as a credible alternative to the government. They have also been working a strategy based entirely on "rural" Newfoundland and Labrador based on some vague theory of the local electorate. The theory doesn't hold water, especially since it ignores where the majority of the people in the province actually reside physically and philosophically.

For Grimes himself, it is time to exit gracefully from the political stage. I have known Roger for almost 20 years and while I respect him a great deal, I have to give him that advice publicly and honestly.

The trending in the CRA polls (and in other polling) is bad; there's no up-side. There is virtually no chance Grimes can achieve ratings numbers as high as the ones he got last year short of seeing the Premier parading down Water Street in a bra and panties and babbling about the voices in his head. Even then, in the absence of a credible alternative, voters will still pick the raving loonie. Even then, Roger's numbers will be determined by someone else's actions, not his own. No politician can win anything when his support depends on other people's failures.

Pick a moment, Roger. Move on and hand the party over to a new leader, preferably one outside the ranks of the caucus.

6. For Williams, he needs to look beyond the polling peaks and troughs. He who lives solely by the polls, like Brian Tobin, dies by them as well. Lasting political support comes from principle, consistency and accountability.

Let's look at some of the numbers a bit more closely. CBC compares Williams to the Clyde Wells high rating (86% approval) achieved after the 1993 election. The Wells' number is party support; the Williams' one is satisfaction.

The Wells Liberals hit that number after four years in office, ongoing budget restraint, long after Meech Lake and after a hard-fought election campaign. In fact if you look closely you'll see the number was in November 1993, when the general election took place the previous spring! Even at this point, Williams' Tories are 12 points shy of that mark when comparing party support to party support.

I don't have the records in front of me, but I do recall that Wells personally hit a high number in the same range during Meech, but apparently CRA doesn't have personal approval numbers before 1992. Williams personal approval is the highest for CRA's data set.

More importantly, though, over the course of his administration, public support grew and remained at relatively high levels for an incumbent government in hard times.

Wells didn't get there on his own. He consistently emphasised the real team of Liberals in government. The Liberals also didn't get there with staged events and mounting campaigns with messaging framed on the basis of polling. That's Tobinesque.

Wells followed his principles. He articulated his principles. He stuck to his principles. He communicated openly and thoroughly, telling people frankly what was going on: he was accountable.

In 1990, the provincial government signed the landmark Hibernia deal but there was a simple ceremony at the hotel based on the premise that the story didn't need hype to be sold convincingly. Res ipsa loquitor. He would never have sanctioned any advertising for it.

I won't draw a bigger trend out of it but it is important to look at the Williams' administration campaign "events after the January deal was signed. Look even more closely at the reaction of Williams supporters in places like the Fair Deal website to the $200, 000 ad campaign. That's the kernel of the consistency and accountability thing. The ad campaign was hype on top of hype and ran counter to the messages of restraint government has been carrying. The public was consistent in their acceptance of keeping a tight reign on spending; Williams was interested in something else and a gap opened up.

It's not a big gap, but it could be indicative of how this government might begin reacting more to the sprinting needed to boost opinion polls rather than running the marathon called governing.

Any idiot can pop an opinion poll through the roof once or maybe twice.

Try keeping strong support over a long haul, in hard times and then popping the numbers up to the sky.

7. CRA polls can be skewed. CRA has been in the public eye for a long time and has a well-deserved reputation for reliability.

But...

Everyone knows when they are in the field. Therefore governments tend to position their good news to occur when the pollsters are calling. ( Could it be that the timing of the signing and the advertising campaign were designed to skew CRA's polling?)

And...

this poll took place over a three week period, compared to say the two or three days used by national polling firms. This tends to give numbers that are more reliable snapshots of opinion since they are focused in time. It's easier to relate the polling numbers to events in the public at the time. It is also possible to ask questions designed to probe deeper than the three questions CRA uses.

For news media, they could use that type of polling to increase the sophistication of their reporting. It is available and at a competitive cost from several polling companies, but for some reason, local media have preferred to stick with the tried or with the tried and crude than take research that holds up.

SES Research , for example, keeps talking about starting a quarterly survey in Atlantic Canada. When they do, let's hope it gets wide coverage in detail. I suspect you will find it much more useful, much more informative than what you have been getting.

Trashing a crash test story

If you think news media never accept news release copy almost verbatim, then check out this little piece from Associated Press, carried on the Globe website.

According to AP, in a series of tests conducted by the Insurance Institute for Highway Safety, a non-profit consumer group,

Quote: Eleven of 13 cars involved in new side-impact crash tests performed by an independent, nonprofit organization earned a “poor,” the lowest of four ratings, the Insurance Institute for Highway Safety said.

The Chevrolet Cobalt and the Toyota Corolla earned the second-highest rating of “acceptable” when tested with their optional side air bags. Without them, they earned “poor” ratings.

The vehicles that earned a “poor” rating were the Dodge Neon, Ford Focus and Volkswagen's New Beetle, Hyundai Elantra, Kia Spectra, Mazda 3, Mitsubishi Lancer, Nissan Sentra, Saturn Ion, Suzuki Forenza and Suzuki Aerio. The results were released Sunday.: end quote.

Now flip over to the IIHS site and see what their release and crash results said.

Quote: Most small car designs earned poor ratings in side impact crash tests recently conducted by the Insurance Institute for Highway Safety. Only the Chevrolet Cobalt and Toyota Corolla, both equipped with optional side airbags with head protection, performed well enough to earn the Institute's second highest rating of acceptable. Without the optional airbags, the Cobalt and Corolla are rated poor for side impact protection.: end quote.

See that second sentence - "Only the"? It's almost identical in both the release and the AP piece and the general thrust of the lead is the same in both the release and the story.

Here's the catch. Unfortunately, the release doesn't accurately report the results of the tests overall.

Yes, it is true that almost all the vehicles failed the side impact tests without having option side airbags installed - most cars and trucks would fail the test - as they did in this test. Even worse, IIHS did not say in the release that they did not test all models with side airbags. Some had standard side airbags; some had none even though they were available as an option. Therefore any comparisons are completely invalid.

IIHS also didn't point out in the lead (the opening bit) that in fact almost all the cars they tested scored well (acceptable to good) in front-on collisions. Results varied for rear impacts and, again, not all models had been thoroughly tested at the time of the news release.

Inaccurate or incomplete data seriously skews the test results and hence the accuracy of any conclusions drawn from the data. The problem for consumers only gets worse when the public relations people for the IIHS spin their news release.

The whole thing ends up in a major roll-over when Associated Press takes the release and paraphrases it without apparently bothering to check the IIHS website and the data tables. In the old days before the Internet, reporters on a tight deadline could be forgiven for not having time to follow through on every single release they take and turn into a news story.

It only took me about 30 minutes to see the crap from IIHS and generate this little comment. It wouldn't take much longer to write up a more accurate story for the AP wire. For that matter I might have even uncovered another story altogether: consumer watchdog agencies that report their own data unreliably.

07 March 2005

Paul Watson: cod aren't cute enough

As tiresome as it is to endure yet again another round of the annual harp seal campaigns by people like Paul Watson, it is clear that in Watson's case, his brief - dare I suggest half-hearted - efforts at dealing with the global decimation of world foodstocks by fishing nations is not as lucrative as flogging the annual seal "slaughter". That's the only reason Watson is back clubbing Canadians.

Supper this evening was interrupted by Watson and actor Richard Dean Anderson being interviewed by CBC Newsworld from Charlottetown on the upcoming international day of protest against sealing. Watson mentioned that there is a planned boycott of Canadian seafood products (not related to seals) as a way of bringing the matter home to Canadians.

Perhaps Mr. Watson would dare to bring the same pressure against nations like Russia, Spain, and Portugal to name a few.

In the course of the interview, Mr. Watson claimed, among other things that:

- there are fewer than five million harp seals, therefore the current hunt is a danger to their survival; and,
- ending the seal hunt will actually be beneficial to cod stocks.

Let's look at some objective evidence and some scientifically based observations.

1. Harp seal population. It is generally accepted that the current population of harp seals stands at about five million animals. Check this link and this one for confirmation. Even an appallingly biased piece written for the New York Times last spring acknowledged that current seal populations have tripled since 1970 to almost five million animals.

While anyone can quibble about the rough estimates, it is clear that harp seal populations in the northwest Atlantic have been increasing since the cod moratorium in 1992. This comes despite an annual total allowable catch for harp seals of levels near the current one (350, 000 animals).

In the interview, Watson made a claim that in previous times (i.e. before European arrival in the New World) harp populations were approximately 20 million animals. He can cite no source for this claim, of course, least of all a verifiable one.

2. More seals would be good for cod stocks. Watson made the claim that seals prey more on species that prey in turn on cod than on cod themselves. Therefore, an increase in seal populations would benefit cod.

The very best that can be said for this claim is the conclusion reached by Bill Montevecchi in 1997. Dr. Montevecchi concluded that it is almost impossible to determine the impact of seals on cod either beneficially or detrimentally since both creatures function in a complex ecosystem: "To assess seal predation in isolation from the complex ecosystem of which both seals and cod are part is both simple-minded and ecologically ignorant."

The worst that can be said is that Mr. Watson's claims are indeed simple-minded and ecologically ignorant.

Harps feed on many species, although once matured, Atlantic cod (gadus morhua) have very few predators and certainly none that a seal will tangle with. Given that the species which do prey on juvenile cod are also subjected to heavy predation by humans, growing seal population is actually more likely to increase pressure on cod stocks. This is not an excuse for an increased seal harvest, rather it points out the faulty logic of Mr. Watson's argument.

Mr. Watson makes no observation on the paradox that despite increased annual TAC, seal stocks have actually increased in the past 15 years. He simply denies that seal populations are healthy and that current human predation - even if one takes worst case scenarios for unreported predation - still amounts to less than 10% of the seal population and remains less than the typical annual seal pup yield.

Logically, if seals have more young than the total predation, the population will grow. More importantly, though, Mr. Watson and others fail to identify the impact that commercial fishing for groundfish stocks had on seal populations through accidental seal kills (caught in nets etc). Coupled with annual harvests, it would appear that the combined pressure reduced seal populations dramatically. However, as fishing activities declined and finally were curtail, especially in areas where fishing and seal habitats overlapped, seal populations have actually been under less total predation than they were before 1992.

A balanced, ecological approach to fisheries management considers both the human and animal components of the activity. None of the anti-sealing protestors take into account the legitimate, traditional and economically important role that harvesting seals plays in the livelihoods of those who harvest the ocean's bounty for a living.

No sensible management can come from Mr. Watson's efforts. Then again, Mr. Watson isn't interested in what is ecologically important. If he was, he would have long ago abandoned seal hunt protests and taken to engaging the world in a protest against the systematic destruction of fish stocks that have fed the world for generations.

Unfortunately, Mr. Anderson and others with high profiles, deep pockets, sincere convictions and limited information would not write cheques to save cod and could scarcely be counted on to appear on camera kissing a turbot.

As for me, I'll base my opinions about environmental management on the views of people who know what they are talking about. That means when I see Paul Watson on television, I'll be clicking him off in favour of watching reruns of MacGyver and Stargate SG-1 where I can Mr. Anderson doing what he does best.

Fraser should leave the building

The latest report from the Auditor General into travel claims and other expenses by the province's Citizen's Representative (CR) makes it pretty clear that, among other things:

- there is a lack of control over cellular telephones within the Office of the Citizen's Representative resulting in large bills for cellular use outside normal office hours; and,

- the CR's problems with providing accurate travel claims is much worse than originally presented, including a claim for travel across the province to Port aux Basques when cellular telephone records indicate the cell phone was in Nova Scotia and St. John's.

In the ordinary course of things - that is had Mr. March owned up to the obvious problems - these specific claims might not warrant removing the CR from office. They would warrant a reprimand and imposition of much tighter controls on spending public funds within the CR's office.

However...

Fraser March's aggressive - and excessive - attack on the Auditor General and others have raised this issue to a much greater level. His unwillingness to be bound by legitimate rules is too much to tolerate any further. The public deserves better.

Mr. March's credibility is now in doubt, as is his fundamental commitment to spending public money appropriately and with proper accountability. His earlier attacks confirm that Mr. March is unwilling to be accountable while supposedly holding others to account for their actions as he is charged with doing as the citizen's representative.

There is no room in public office for any level of hypocrisy, let alone that embodied in Mr. March's behaviour as the citizen's representative.

Period.

There has been enough of this matter strewn across the news media.

Now is the time to end it.

If Mr. March has an ounce of integrity, he will resign immediately and without further explanation or equivocation.

If he will not resign, then he should be fired forthwith with no expectation of severance or other compensation beyond the minimum provided in his employment contract.

If anyone needs an ethical benchmark here, look at Boeing or check out the federal government standards. Heck when it comes to real accountability, the whole provincial government here could do well to copy the example set in Ottawa.

There is no excuse for further delay.

04 March 2005

More by-election bull****

Hot on the heels of the announcement by defence minister Bill Graham that the feds are spending $10.0 million to resurface the Goose Bay airfield, Stephen Harper flopped into town with a promise of his own.

I'll leave it to you to judge which is more pathetic: an old-fashioned grab for votes with pavement or total bullshit promises that the politician making them knows he can't keep?

Here's the CBC Radio version of the story and Harper's commitment:

"Goose Bay should have a long-run military operational purpose and we'd obviously consult the town and DND on what that would be," Harper said.

Problem is, Stephen, there isn't an operational purpose for Goose Bay within the Canadian Forces.

Not a sausage.

Bugger all.

Even with the Cold War raging in the 1980s the major mission for Goose Bay was training somebody else's air force. Since then far bigger brains than yours and mine, Stephen, have tackled this problem and failed to find a Canadian operational need for Goose Bay as a military base.

So go ahead and consult, Stephen. Everyone in Goose Bay knows your promise is worth less than a pile of pine marten dung.

While we are at it, let's give you some more good advice.

CBC quotes Harper saying this: "The base doesn't need asphalt," he [Harper] said.

Talk about a Homer Simpson moment.

D'oh.

The base does need pavement, Stephen. I know what your speechwriter was trying to say, but he or she failed miserably. The statement as you read it shows quite clearly that you have absolutely no idea what is going on in Goose Bay at all, in any meaningful way. Now certainly Con and Tory partisans will accuse me of all sorts of heinous crimes - like being a Liberal - but, d'uh - why not accuse me of being a guy while you are at it - , and more importantly, what does that have to do with Harper's fumble?

Harper should have just pledged to work with the community to identify new opportunities in Goose Bay. He could have talked about something modest but workable, like making Goose the centre for extreme testing and training.

He could have done anything except mouth the vacant words he littered on the cracked tarmac.

Which is more pathetic when it comes to politics?

Which breeds greater cynicism among voters?

You make your own choice.

For me, at least I know that when the Liberals are done, the runways, ramps and taxiways at Goose Bay will be ready for another 20 years of aircraft movements.

Something tells me I can't get the same practical mileage from Harper's speech no matter how finely I shred the paper on which it was scribbled.

Rompkey and missile defence

Bill Rompkey is still pushing an X band radar system for Goose Bay.

Bravo, Bill.

In this CBC Radio story, defence minister Bill Graham even says kind things about the idea, like"we'll look at it seriously."

[Psst, Mr. Harper. Pay attention to how politicians speak to local audiences before a by-election.]

Having already pumped out a raft of stuff about x band radars and Goose Bay, let me just frame up this scenario for you and see if it works for you:

The Americans haven't made a formal proposal to put anything at Goose Bay because.... well...they don't need Goose Bay.

NORAD doesn't really need an X band system at Goose Bay since they can access data from Thule and Fylingdales Moor (two BMEWS sites in Greenland and the UK).

But.....

Canada needs to be seen to be doing something for North American defence...

and...

there isn't much else they can see doing at Goose.

Therefore,

the feds will spend time and energy studying Rompkey's suggestion. If it looks like it might have an impact on the Americans or we need to give the zoomies some consolation prize for not buying new planes to fly, we'll drop the $500 million on the new facility and operate it largely ourselves through the Canadian Forces.

If it doesn't matter a row of beans, then we will at least have kept people busy thinking about the possibility of maybe building a new radar system. By that time, something might have come up for Goose Bay.

03 March 2005

Local soldiers train at Fort Pickett, Virginia

Approximately 140 reserve soldiers from St. John's left today for a training exercise in Fort Pickett Virginia.

The soldiers are from First battalion Royal Newfoundland Regiment, 56 Field Engineer Squadron, 36 Service Battalion and 728 Communications Squadron. Some local news media have also taken the chance to accompany the soldiers on the exercise.

Fort Pickett is an integrated manoeuver training area. The Newfoundland soldiers will be reportedly focusing their training on operations in urban environments. Like most major army training areas these days, Fort Pickett has a large, purpose-built section of streets to give soldiers realistic experience in working in urban areas.

While there are live fire ranges available as well, the Newfoundlanders will have the chance to work with weapons effects simulators, which have been used in the US military for the past 20 years but which are only now coming into service in the Canadian Forces.

The biggest value of this training will come from the variety of equipment available and the experience of soldiers with actual operational experience overseas.

For those wanting more information on Fort Pickett, here are some links:

1. fortpickett.net is an official site containing a comprehensive overview of the base, its facilities and the types of training possible. There are plenty of pictures and maps.

2. Global Security maintains a profile of the base as well.

Sino Energy timelines and national security

Since it is now past Wednesday, last weekend's Independent is available online and this week the format has caught up with the hardcopy version.

There's a story by Jeff Ducharme called "Pulling the plug" that argues, among other things, that sanctions against a member of the Sino-Energy consortium may bar that group from developing the Lower Churchill, if there was to be any hope of selling the project's electrical power to the United States. Under a deal signed with the provincial government, Sino-Energy has access to any and all information held by Newfoundland and Labrador Hydro related to the Lower Churchill project.

As Jeff notes:

**The China National Machinery and Equipment Import and Export Corporation [CMEC] is part of the Sino Energy consortium that has expressed interest in developing the lower Churchill and its total 2,824 megawatts of electricity. The province signed a memorandum of understanding with the consortium in 2004.

The Chinese state-run company has been sanctioned by the U.S. government for selling components used to make and develop weapons of mass destruction. [Actually, it was guidance systems and other components related to ballistic and anti-shipping missiles. EGH]

“There’d only be an issue if this could possibly be construed as an import into the United States that (the Chinese company) produces,” the State Department official tells The Independent on condition of anonymity. “We’d simply bar the import of that product into the United States.”**

Some of you may recall that the sanctions were revealed locally by The Telegram where reporters did a simple search of the Internet. In a reaction comment, the Premier speculated about mysterious leaks from Sino-Energy competitors. Sinister plots are sometimes part of Danny Williams' stock effort to deflect attention away from an issue, in this case the complete failure of anyone in the provincial government to google CMEC and see what emerged. These conspiracies usually turn out to be figments of his imagination and in this case, having spoken with the reporters who broke the story, I am confident there was no leak nor was there any plot. According to Ducharme, a request for a copy of the report from a Montreal law firm to investigate the issue is being withheld by the government under a claim of solicitor-client privilege.

That background makes humourous the comment by natural resources minister Ed Byrne in Ducharme's piece that the government will exercise "due diligence" when evaluating proposals to develop the Lower Churchill. Proposals are due no later than 31 March 2005.

That aspect to one side for a moment, no one else seems to have noticed that, if everything worked out the right way for the provincial government on the Lower Churchill and efforts to attract the Americans to Goose Bay, there would be an extremely significant security issue in Labrador. Imagine having a Chinese state-owned enterprise with its own personnel coming and going right next to a key radar system in the American ballistic missile defence system.

Here's a link to a report by the Canadian Security Intelligence Service (CSIS) on foreign espionage in Canada in 2003. I'll exerpt the bit that is referring, obliquely, to countries like China:

"Several sectors of the Canadian economy are considered sensitive and likely targets of foreign interest, including: aerospace, biotechnology, chemicals, communications, information technology, mining and metallurgy, nuclear energy, oil and gas, and environmental technologies. Certain foreign governments direct their departments, state-owned corporations and intelligence services to engage in economic espionage against Canada."

China is well known as a country which engages extensively in economic espionage. China was also a key arms supplier to both Iraq and the former Yugoslavia. It is highly likely that sensitive intelligence gathered during the 1991 Gulf War by Iraqi air defence was relayed through China to Yugoslavia and resulted in the shooting down of an American F-117 aircraft during operations related to Kosovo in 1999. That's a whole other story, but there should be no doubt that China is a country of significant interest to Canadian security officials. Since the BMD system is directed at countering weapons systems owned by countries that are customers of Chinese defence industries, any opportunity by China to gather hard intelligence on the system would surely be welcome. What better excuse to provide cover than to be working on a hydro-electric project right next door, in a remote part of Canada, far from North Korea or Iran.

All this leads me to a simple set of observations, since Ducharme makes a couple of errors in dates in his piece as to when the Sino-Energy deal was signed and when it was made public.

Let's start with a simple timeline I pulled together last fall, solely related to Sino-Energy. It is based on the documents released by government at the time, contemporary media interviews by the Premier and Minister Byrne and comments by ousted hydro director Danny Dumaresque in October. Here it is, in point form:

January 2004

- Government begins discussions with Sino-Energy consortium.

20 May 2004

- Ed Byrne is asked in a House resource committee meeting if "any discussions" are underway related to Lower Churchill. Byrne responds: “No”.

21 May 2004

- Byrne signs confidentiality agreement with Sino Energy. No representative from Hydro signs the agreement.

?? June 2004

- Government signs MOU with Sino Energy allowing disclosure of all information related to Lower Churchill. CEO Bill Wells signs on behalf of Hydro.

- No public disclosure of MOU. Confidentiality agreement provides government can disclose existence of MOU at its discretion.

25 June 2004

- Hydro board receives request for $1.8 million for Labrador Hydro Project office as a last minute addition to the agenda. Money is to cover costs up to end August 2004. No other information on the purpose of the request is provided as the LHP office reports directly to the Premier. Board advised LHP office can continue to operate until that period without additional money since it has funds left from FY 2003.

- Hydro Board defers decision; instructs Chairman to write to Min Natural Resources seeking further information.

- No information provided to Board on Sino Energy by CEO Bill Wells, according to Danny Dumaresque.

18 July 2004

- Letter to Min Byrne from Board Chairman

28 July 2004

- In a surprise move (since none of this was yet in the public domain), Premier discloses during media scrum that government has signed MOU with an unnamed company to explore development of Lower Churchill using a route that does not include Quebec. (MOU makes no reference to this aspect.)

August 2004

- Two new members named to Hydro Board. No information on Sino Energy provided to Board.

20 September 2004

- Premier publicly announces appointment of two new board members to Hydro as well as a new chairman (Dean MacDonald). Announces two members removed from Board.

- Premier releases Sino Energy MOU and Confidentiality Agreement

- Premier releases draft agreement with Quebec negotiated by Grimes government.

Let me be absolutely clear about one thing. I am not stating nor am I implying that there is anything criminal in all this. I just find the entire matter of Sino Energy to be shrouded in a certain level of misinformation that seems highly unusual, if not peculiar.

Second, it is astonishing if not appalling that no one in the provincial government appears to have made any inquiries regarding CMEC. The google search is a minor thing. Provincial officials can easily make confidential inquiries of the police and security services, especially when dealing with a state-owned enterprise from a country known to engage in industrial and other types of intelligence gathering. CSIS does have an office in St. John's, the last time I checked.

Third, it is also astonishing that this confidential agreement could have been signed and kept secret for two months. There was no compelling reason for the Premier to unveil the memorandum of understanding when he did; that he did so raises questions as to why he did it then and not several months beforehand.

Fourth, given that Ed Byrne told the House resource committee in May 2004 that government intended to solicit proposals on the Lower Churchill later that year, it is extremely odd that the provincial government would provide Sino Energy with extensive information - access to anything on the project - and months of lead time to prepare a proposal.

Ducharme's story only touched the very surface of this story. Maybe somebody will dig a bit deeper. Either there is more to the Sino Energy story than meets the eye or I am having an Emily Litella moment (Oh, never mind.)

I just can't shake the sense that something is missing from this Chinese puzzle.

02 March 2005

The smell of a by-election ...

in Newfoundland and Labrador is often the smell of new pavement.

Over at VOCM, they are reporting what I said a few days ago: an announcement at Goose Bay smells like pavement. Well today, Defence minister Bill Graham announced a project to resurface the runways, taxiways and ramps at Goose Bay with a reported cost of $10.0 million.

The work is definitely needed. But it is still pavement or asphalt or tarmacadam, as was sometimes used for airfields. (Now you know where the phrase "tarmac" comes from, as in "the plane is on the tarmac".)

There is a by-election coming up.

And so far, no one has come to grips with the problem of future economic opportunities at Goose Bay.

The sarcastic bugger in me would suggest a clock factory so everyone can keep hearing time tick away.

Flogging a dead horse... err...Goose

A faithful reader of these electronic scribblings has brought my attention to a website containing a listing of news stories related to the ballistic missile defence project.

It would seem that events last fall have knocked Goose Bay off the list of likely sites for a new radar installation. That is, off the list unless Canada wanted to pick up the tab on its own. Briefings reported in stories by David Pugliese in the Citizen yesterday and today may actually be nothing more than sales pitches by Raytheon, not official US government proposals. (If this is true, then people have really been getting worked up for nothing. )

The Yorkshire (UK) Campaign for Nuclear Disarmament chapter deserves thanks for keeping everyone informed. Here's the link to their homepage.

Then try the campaign page of news articles devoted to missile defence in Scandinavia.

One story, dating from last August notes that the US and Denmark have updated the 1951 Defence of Greenland Agreement to include installation of new radar systems at Thule (pronounced thoo-lee) to support the ballistic missile defence program. Interestingly, this agreement may give the US the right to install interceptor missiles at Thule. The plan is reported to involve installing x-band radar systems.

Another story from Nunavut quotes a Canadian Forces officer as saying this decision makes it almost certain that no BMD systems will be built anywhere in northern Canada. (Take that, Bembridge scholars.)

There are several radar systems involved in this including upgrading of the existing BMEWS (ballistic missile early warning system), pronounced like "be muse". An earlier posting on the Yorkshire CND site covers this. This link to Raytheon gives a very brief description of the BMEWS upgrade.

Nostalgia moment: all these acronyms and talk of ballistic missiles takes me back to my undergraduate thesis on Soviet defence policy.

Tobin: poor man's Rambo

Check out a CanWest story today on memoirs of a senior federal official involved in the turbot confrontation with Spain a decade ago.

It's also in the Telly under the title "Memoir reveals the war behind the Turbot War".

The account here sounds about right. I heard Brian Tobin recounting this whole affair a year or so after he came back to Newfoundland. He was definitely getting off on enthralling his mostly youngish audience the tale. In the way Tobin told it at the time he seemed to feel like the whole thing gave him some macho leader image.

Fact is, he was nothing of the sort; his whole presentation was more like the juvenile posing of some kid retelling the gory bits of some Rambo movie than the story of someone who had been there. "Oh man, you should have seen it. Blam. Blam. Powy. It was gross, man. Cool."

At the time Tobin was pumping himself up, I had friends of mine who had shot at others and been shot at in anger. A bunch more were set to go overseas and even today, I have friends in different, dangerous parts of the globe. Over the years, I have talked at length to people who have been in real danger and the people who sent them there.

The last thing any of them do is whoop and pose and thump their chests. Often they are closer to tears with the gravity of the situation they faced.

The only thing that came clear to me hearing that story was an unshakeable conviction that Tobin wasn't the real thing. He gave absolutely no sense at all of appreciating the seriousness of the situation at the time, of the very real possibility that the orders being given would lead to closed caskets being delivered back to small towns in Newfoundland and Labrador.

Maybe Tobin has changed with age, but that episode has stayed with me for almost a decade.

BMD flap overblown

Two things are making me a little cranky today and neither of them has to do with the fact I am not getting enough fibre in my diet.

The first thing irritating my irk is the ongoing chatter about the Stunnel. NTV, the local CTV affiliate even ran a story last night on the idea of a trans-Atlantic tunnel. Now look, people, the idea of a giant hole bored through from New York to Portsmouth may promote rhapsody in people who like their science fiction a la Jules Verne, but these megaprojects are just what engineers do instead of ogle Kate Winslet on the internet when they are all alone in their cubicles.

We are now at the stage where people think we have a shot at dating Kate.

The transAtlantic tunnel is feasible. BUT and pay attention to this: the frickin thing will cost trillions of dollars and take the better part of 100 years to construct. On this last point, note that one estimate of the practical limitations of the concept was that the project would tie up every single yard in the world capable of building pre-fabricated tunnel sections for that entire century!

The same practical limitations apply to the Stunnel. The one part that Keirans and Williams can't escape is that the project makes absolutely no business sense, nor does it make a public policy purpose. There is no more compelling reason to build a tunnel to Labrador than there is to build a tunnel from Bell Island to Portugal Cove.

We know we can do it; but why should we do it?

By way of that digression I arrive at the major irk of the day: the constant nattering about US Canada relations and the rejection of active participation in ballistic missile defence.

I am going to go out on a limb here and predict that in a few weeks, maybe a few months, Condoleeza Rice will visit Canada and everything will be ok.

In the world of the Grown Ups, much of the public appearance of diplomacy masks the reality behind the scenes. Sometimes it is messy. Sometimes it consists of a series of postures designed to play to political realities. Behind the scenes, the grown-ups still talk and the world continues to revolve undisturbed.

Apparently I am the only person who watched CBC national news last night and noticed the interviews from Washington. The only people talking about a crisis were members of the Conservative Party. The rest of the writing on this, including Paul Wells on his blog , seems to be drilling into the superficial posturing on this issue of Canadian participation.

I've turned into a faithful reader of his stuff, but in the same way he can get spun by those evil Liberals on defence budget increases - I am still rolling on the floor knowing he wasn't spun - Paul seems to be looking for some problem here that other evidence might lead you to believe doesn't exist.

Well, surprise of surprises, they are finding all sorts of holes in the logic of the public posturing. Maybe the conclusion to draw is not that the PMO is having difficulty working the phones to Washington, Paul et al., or that the Americans are really super-pissed at us now, but maybe that the whole thing is a bit of a charade.

If the Americans were really that upset, if they really felt that put-upon by our refusal to join in active ballistic missile defence, then we'd see some real signs of their grievance. The language would be much harsher. Trade deals would be cancelled, not threatened. Exchange officers with the US military would be sent home.

What did we actually get?

Condi Rice has a schedule conflict.
Paul Celucci says something about our sovereign national interest.

And?

And?

Well, that's it.

Celucci has said harsher things to his Canadian gardener.

Let's look at some other factors that need to be weighed here:

1. The Americans would have been dead if they didn't see the public statement coming that Canada would not participate in BMD. Therefore, I suspect they had alternative plans in the works all along.

2. We pay more for staying out temporarily; the Americans lose nothing. We lose business opportunities. We sort of lose a seat at the table. Other than that, there isn't an issue. The US builds the system. We get to tuck under it once its up and running.

This is not like the US is building a coalition against Iraq. This is a system for defending the US alone. We happen to benefit anyways whether we are in or out of the actual program. Unless I am completely misreading this, it is NO biggie. The Post can trot out all the retired air force generals they want but truthfully, this is not a crisis akin to walking out of NORAD. The zoomies might want to opt into cutting-edge American air programs for their own service interests, but in the national interest, we can get to the goal without letting the Canadian air force send exchange officers to the MDA. One less air force career billet on the way to general won't wreck the country.

3. We can still opt in at some point in the future. We didn't give the Americans precise directions on how to manually insert the BMD program in some orifice. We politely declined. Two years from now, a majority government can opt in following a quiet offer and away we go.

4. Look at David Dreier. A senior Republican congressman from California was quoted on CBC saying the whole thing was a minor issue and we could all get past it. Hello. Wake up people. Belinda Stronach does not represent George Bush (She was quoted in the same report predicting nasty things would be happening soon.) As much as Belinda is the leader the Cons should have chosen if they had really wanted power last year, I'd put bags more faith in Dreier's opinion being the same as that of the Bush administration.

At some point, these two things will blow over. I just have to picture a calm blue ocean until they do.

That and get ready for my date with Kate.

SBX off Labrador? More background info

Yesterday, I raised the prospect that the United States might opt to place some its ballistic missile defence assets at sea off Labrador rather than try and locate them at Goose Bay. The more I think of it, the more I realize this is a viable option.

Those who read David Pugliese's story in yesterday's Ottawa Citizen know that he didn't say the x band radar at Goose Bay was a dead project; he said it was wounded.

I am just speculating on another scenario in which the Americans build another sea-based radar like the one they plan to position off Alaska. They could locate it close to the Canadian territorial sea or, if the sea conditions and weather permit, they could put it beyond the 200 mile exclusive economic zone. Either way they get the radar they need and it is beyond Canadian jurisdiction.

Following are some links to more information:

1. Global Security. Very similar to the Federation of American Scientists site, Global Security has a comprehensive page on the sea-based x band (SBX) radar project right down to contract numbers. Prime contractor on the project has been Boeing. Raytheon is developing the radar system. The whole project involves the adaptation of a CS-50 type semi-submersible rig. Working on the project are Kavaerner and Kiewit, companies well-known in the local offshore industry.

2. Missilethreat.com. A provocative name, but this site has some simple background information, some good cross links and a set of references to other sites and published articles.

3. Hull construction. Over at the BMDS Integration Data Center they have a series of photographs of the platform under construction in the Vyborg shipyard near St. Petersburg.

4. Raytheon. The radar company has an excellent site listing its products as well as a nice computer generated image of the SBX system.

5. Prowl the Aker Kavaerner site to see if there are any more subcontracts like this one supporting the SBX.

6. Ditto for this site listing the award of a US$73 million contract to modify the platform.

7. Here's a site for MOSS, listing some alternative uses for their platforms. The SBX is mounted on a CS-50 type platform, as noted earlier, a rig base that has been in use for decades. This company, along with Boeing, Energia and Kavaerner is also exploring the idea of using a rig as a mobile platform for launching payloads into orbit.

8. You can find the website for Russian shipyard Vyborg here, in Cyrillic of course. This is the yard that built the platform being used to mount the SBX. Topsides work, including installation of the radar system was undertaken around Corpus Christi, Texas.

Take a close look at this site though; it has bags of information on the yard and its operations. The site is in Russian but Cyrillic is not that hard to read, once you get used to it. Try using a simple table of comparison like this one if you get into trouble.

Ya strudom gavaryu pa russki. And my Cyrillic to Latin transliteration likely has problems too.

01 March 2005

Goose Bay and BMD

There's a story by defence writer David Pugliese in the Ottawa Citizen today concerning the impact the Prime Minister's decision not to participate in active ballistic missile defence might have on Goose Bay. The story is also carried in The Telegram, but it isn't on their website.

Here is some additional information and some observations.

Background information on X band radar systems can be found here at the Federation of American Scientists site.

The official Missile Defence Agency website is here. This is an awesome site which gives basic information on a technical subject in a language any twit like me can understand.

While you are there, click on the BMD basics button on the top menu, then on the sensors button on the left menu. Then scroll down to the file on a floating X band radar system being developed for deployment off Alaska.

This takes the radar system and mounts it on a modified semi-submersible drill rig. It is scheduled to be deployed off Alaska.

This started me thinking. Is it possible this same system could be deployed on the east coast? In some respects, it would depend on how important the Americans viewed having their sensors covering the northeast of North America. Were they to consider it vital to their national security, I suspect they'd play relatively hard and float the rig out there.

Legally, the Canadian territorial sea extends 12 nautical miles: that's it. After that it is an exclusive economic zone. Foreign vessels have a right of innocent passage under international law and it becomes a bit of a question as to whether or not the Canadians could legally force an American defence system like this to deploy outside the 200 mile exclusive economic zone.

Under the Law of the Sea Convention, the rights conferred on a coastal state for an exclusive economic zone apply explicitly to economic rights, not ones for national defence. The economic rights cannot interfere with other well-established international rights like, say,m self-defence. In some respects it becomes an issue of how far would Ottawa be prepared to push this issue since the structure would be miles out at sea and therefore invisible.

The system would be totally under American control and with the exception of some rights to use nearby port facilities for service and support, it doesn't impact on the coastal state. If the Americans haven't completely abandoned their Atlantic Charter rights to bases in Newfoundland and Labrador (lawyers start your searching), then they might just be able to do something without Canada's active support. At the very least, the Americans can resupply from bases in Maine and simply use Canadian ports like St. John's as they currently do.

All that said, I did make a distinction earlier that Canada is not participating in active defence, that is shooting down missiles. However, we are staying in NORAD which has a huge passive component, namely radars, to detect attacks.

Generally, I would agree with those who argue that the Prime Minister is trying to have his cake and eat it too, when he argues that the Americans would have to ask before shooting down a missile in our airspace despite our rejecting active participation in ballistic missile defence (BMD).

But on the other hand, I just don't think that we can get past NORAD and the integrated nature of North American defence; that's why I think the feds are walking a fine line here trying to find a balance between national security interests and the public attitude in Canada against BMD.

The X band radar Pugliese is talking about could still come to Goose Bay under the guise of NORAD as a passive sensor. The fact that its data might be used to target missiles physically located in Maine or offshore on ships is the head of a pin on which federal mandarins can dance. We already play these sort of clever games now in NORAD when it comes to the issue of nuclear weapons release. I seriously doubt that the Canadian NORAD deputy commander has actual authority in the American National Command Authority chain in the event of hostilities; but it looks good on paper and we have been looking good on that point since 1957.

Then again, the radar might just wind up floating offshore.

Any chance we could get a repair and refit contract for Bull Arm or Marystown in the meantime?

Owen Myers, Etchegary and overfishing

Too bad the Express didn't link Owen Myers column on the fishery last week.

He made some interesting comments about overfishing practices by local companies like Fishery Products during the 1980s. According to Myers, FP issued orders that its vessels couldn't bring back any fish less than 16 inches long. That's called highgrading and involves dumping millions of tons of dead fish that fall below the size standard set not by international regulation but by corporate policy.

Oddly enough that was the same time Gus Etchegary was a senior official at the private sector FPI and then the company rescued with tax dollars.

This is the same Gus Etchegary who maintains that it was foreigners who destroyed the fishery and that Canadian fleets were so heavily regulated they couldn't do anything wrong. Questions about Etchegary's past behaviour have been raised before, but Gus just comes out swinging whenever his past surfaces. I especially like Gus' threat against DFO at the end of that link to The Independent.

It pays to read all the news media sources out there, not just listen to Open Line. (Hint hint for political types on the Hill)