Tom Rideout - metaphor mangler extra-ordinary

The return of Tom Rideout to a position of considerable authority prompts an old political junkie to reminisce about some of Tom's glorious past.

Elected as a Liberal, Rideout crossed the floor in the early 1980s to sit with Brian Peckford around the cabinet table. There's an old Bill Rowe column in which he criticizes the local penchant for floor-walking among elected legislators. It used to make the rounds of local politicos every once in a while and I haven't seen it in years.

When Peckford packed it in in 1988, Rideout took a run at the leaders job and, after a hard campaign, eventually beat out the likes of Len Simms to sit in the Premier's Office. He created one of the largest cabinets in recent memory swelling the thing to 23 members, with assorted other members of caucus serving in various House positions or as parliamentary secretaries. The only legislators not receiving extra stipends had the misfortune of being in Opposition.

Rideout moved in, moved all Peckford's people out the door, and then dropped the writ in the hopes of winning a majority government against the Wells' Liberals.

Rideout lasted a total of 43 days as Premier, the shortest tenure of any Newfoundland first minister since the 1920s.

Three events or incidents stand out from 1989 that helped to define Tom Rideout in the minds of voters. I am not thinking about his incredibly awkward speaking style and his unease, nor am I talking about episodes like helicoptering into Placentia two days in a row toward the end of the campaign with nothing new to say on the second trip.

Nor am I talking about his leadership campaign chant "Ride In! Right On ! Rideout!"

Nope.

First was Tom's comment that "a skunk can't change its spots". I have long forgotten the context but the mangled metaphor has stuck with me ever since. I thought about using that in the other post but the "skunk" reference seemed an unwarranted and entirely unintended comment on character.

Second was another one of his magic moments with the English language, this time from the televised debate. At one point, with ever ounce of self-confidence he could muster, Rideout challenged Wells on some point. He finished his remarks with the immortal words: "And that's backupable."

Third was actually a preplanned bit of campaigning. Rideout and the other leaders spoke to Memorial University students, where, predictably, Rideout trumpeted his government's commitment to post-secondary students. In the queue for the microphone was a MUN student and Liberal supporter. When she got her chance, she held aloft a cucumber and asked: "Does this look like a post-secondary education student to you, Mr. Rideout?" Great laugh from the crowd. An immortal political clip and yet another smack between the eyes for a Tory campaign that seemed prone to every manner of political cock-up imaginable.

There are plenty of little ones, most of which I have long since forgotten. There is one where Tom was speaking off-the-cuff but obviously thinking of the written word "divers" or the alternate spelling "diverse". He said the same word twice as if there were two different pronunciations and meanings. It was an obscure gaff only a few of us got, but for those that did, it was hysterically funny.

Rideout may not commit any of those embarrassing gaffes anymore, but there is always the possibility he will revert to his old ways when things get heated. One thing we can all count on: Rideout is viciously partisan and like all converts - like say John Crosbie - he will never miss a chance to blame anything he can on the guys who were there before him.

Unfortunately for Tom, as funny as it was to hear a cabinet minister from the days of the Roads for Rails deal crap on the deal he approved in cabinet, it is going to get even funnier if Tom starts blaming others for the problems he is currently facing: he's created his own problems, as usual.

Careful Tom, that might be loaded.

The return of Backupable Tom - update

In a surprise move, Premier Danny Williams today shuffled five of his cabinet ministers around, including appointing Tom Rideout as the new minister of fisheries and deputy premier.

Rideout's predecessor, Trevor Taylor, has been talking forthrightly for the past few weeks, including some genuinely straight talk in the wake of Derrick Rowe's departure as chief executive office of Fishery Products International (FPI).

Taylor talked himself out of a job. That's clear. But the problem is not that Taylor was wrong. Rather, it was painfully obvious that Taylor was at odds with the cabinet - especially the Premier himself - about how government ought to respond to the problems.

As the Bond Papers noted last Friday:

"Taylor has spoken openly of the overcapacity in the fishery. At the same time, Premier Williams has committed to assisting the community of Harbour Breton cope with the closure by FPI of the community's fishplant. While it is far from conclusive, these contradictory opinions suggest that there are some significant policy differences within government on fisheries issues."

Rideout's appointment is a clear signal as to how the Williams administration will respond to problems in the fishery. If the shuffle itself wasn't enough, the creation of a new portfolio in this administration, that of deputy premier, makes it clear that Rideout holds power and influence in the Williams cabinet second to none except Danny Williams himself.

Rideout was fisheries minister under Brian Peckford between 1985 and 1989 and served in the Peckford cabinet from the time he crossed the floor a few years earlier. Rideout is intimately familiar with the plans to prop up the fishery using tax dollars, rather than reform it.

More importantly, Rideout was fish minister when Fishery Products International was created out out of the collapse of smaller processing companies in the province.

All that points to a return to government intervention and government subsidies in the fishery. It reinforces the idea that the disastrous raw materials sharing program was something foisted on Taylor by his cabinet colleagues. The plan, which attempted to spread a limited resource to as many people as possible, was fundamentally at odds with the implications of Taylor's other public comments about the fishery.

The difference between now and the 1980s is that government has the cash - hundreds of millions of dollars in oil money - to pay for whatever it decides to do. But in truth, the province doesn't really have the cash - the Peckford era policies - every one of them - contributed greatly to the hideous financial mess facing the incoming Wells administration in 1989 and continues to burden the treasury in the form of the growing debt. When Tom points to previous administrations to blame, he is truthfully pointing to his own and ones of which he was a part.

All of this might turn out to be completely wrong; it's just a matter of opinion.

But given the history of this place and the people making decisions, I'd be willing to place a small wager on it:

Tom Rideout will take the province's fisheries policy back to the dismal past.

And that, to quote the former premier, is backupable.

[Update - CBC Radio's David Cochrane made a couple of observations about the big switcheroo today, which I will attempt to paraphrase below. The remarks here are mine, though. Nothing should be attributed to Cochrane in case I misquote him.

1. This is the biggest shuffle in the two years of the administration. Yep. Absolutely. The last shuffle was made because of the unbearable tension between the Premier and his former minister of health. If Trevor hadn't been shuffled he would have been Fabed, or something close to it.

2. Normally, the Premier might have waited a few months for a big shuffle. Again, spot on. No one has really screwed up here. Hedderson may have some issues about watches but unless there is something I am not seeing, the three other shuffles (Joan Burke - Tom Hedderson and Paul Shelly) are just a screen for the major one to make it look less obvious that Trevor got a kick in the crotch.

3. In this case though, as I recall David saying, this was intended to send a message to FPI communities that the fishery is important and, as proof, the second biggest guy in cabinet is in charge of the fishery. Again, right on the money. But where I'd go a step beyond is to point to the likely direction of government policy. If Williams thought the fishery was important enough to reform, he'd have left Taylor place.

What the Premier has done here - understandable politically - is to send a powerful signal that the fishery is so important, nothing is going to change. The Harbour Breton model is going to be the one at play here: pump cash in so people will not leave. Make no mistake: I think Peter Fenwick got this whole thing dead wrong when he wrote that the government policy on Harbour Breton marked a break with the past.

The fix is short-term, to be sure, but then again, that's what I meant when I based my prediction on the history of the province and how decisions get made.

There's also an element here that the Premier - this Premier - is not going to be the guy who brings bad news to anyone at all, ever, unless he absolutely has to.

Take a gander back to that Fenwick piece. Fenwick reflected a great deal of optimism six months ago and he may well hold a different view today, but there is no doubt that this government appeared headed in a much different direction on fisheries issues than it appears to be on right now. The High Liner example Fenwick notes is an example of what Taylor can do when he is allowed to work.

However, in the other cases, including Harbour Breton, the Premier took a direct interest and that's when the policies shifted from New Approach to Same Old, Same Old.

The FPI-competitor myth and one of the real problems

Among the many things said about Fishery products International over the past few days has been the replay of the old myth from 2001 that the company was now run by its competitors who were, according to some versions of the myth, bent on destroying it.

A simple review of the company's annual reports since 2001 will show just exactly how untrue that little story is.

Since 2001, Eric Barratt of Sanford Limited has had a seat on the FPI board. FPI and Sanford don't fish the same waters.

John Risley of Clearwater and someone from Icelandic Freezer Group got a seat on the board after 2001. Both companies own shares and would be expected to sit on the board. They represent FPI competitors in some senses, but in the highly competitive world - or anywhere else except crowd that are Number One on the Grassy Knoll in VOCM Valley, it could be a good sign that FPI was attracting interest from other companies looking to compete collectively in a highly competitive world.

But lookit - three is the tops. Three directors connected to other fishing companies. That's it.

The rest of the board, i.e the other nine too a dozen all come from other backgrounds having little to do with fish other than to buy it and fry it up in a pan, barbeque it or feed it to the cat.

The problems at FPI have a lot more to do with three other issues.

First, there is the highly competitive fishing industry globally and the decline of fish stocks around the world.

Second, there is the problem locally with way too many people chasing way too few fish.

Third is the provincial government. Gerry Reid and Danny Williams fit into the same box in my view, although neither is going to feel to comfortable as a result. Both Reid, when he was fish minister, and latterly Danny Williams, as Premier, have needlessly interfered with FPI's corporate business. Each, in their own way, prevented FPI from taking sound business decisions and as a consequence they cost the company millions of dollars.

Don't even get me started on the ludicrous idea that one from cabinet has offered up that we should nationalize FPI. Holy heck. That sort of thinking is how we got into the debt/deficit and economic underdevelopment mess in the first place.

But, look, if people want to find someone to blame for FPI's woes, they don't have to invent conspiracies of foreigners.

Locals have done a fine job of shagging up the fishery...yet again. Most fish ministers and premiers over the past 25 years have done more to screw up a decent industry than enough. The more recent ones, like say Gerry Reid or Danny Williams are just the latest in a long line of people who treated the fishery as a social program instead of a proper business. They stand in the way of sound decisions. Like Reid, this evening, they appear to gloat at having blocked FPI. And true to form, they typically have found a few hundred millions in scarce tax dollars to pave over their mistakes.

Let me point once more to the debt/deficit, in case you didn't catch my drift.

Like Rideout's Political Patronage Follies - otherwise known a road work contracts - the pavement is as exceeding thin on the fishery's potholes as it is on the province's high roads.

Truthfully, though, we don't need to waste time pointing fingers.

Now is the time to get on with solutions.

One of the first would be a repeal of the Fishery Products International Act. It's left over from the stoned age of Newfoundland public policy and, as such, long since overdue for repeal.

I called for it earlier this year in the midst of the crab fiasco.

With any luck it isn't too late to get the provincial government out of the fish company business now.

Constitutional Fish - the decision link

Canada v. Nichol and Bouzan is now posted to the CanLii website.

Here's the full text.

Go mad!

FPI changes may signal massive problems in fishery

Derrick Rowe's departure from his job as chief executive officer of Fishery Products International may well signal wider problems in the local fishing industry.

There are already the problems in the crab sector and in shrimp, as reported widely during the summer. Add to that the chronic problem noted by provincial fisheries minister Trevor Taylor. Clear-eyed Taylor points to the fact there are simply too many people and too many plants in the province for the volume of fish out there. Add behind all that the growing competitiveness of the fishing industry and the province is set for some heavy changes to an industry that holds the status of being not so much as business as the religion of the place.

One of many things some people in the province refuse to acknowledge is that a company like FPI can actually ship fish to China, process it and bring it back to market in North America for less than it would if the fish were processed in Newfoundland and Labrador.

FPI's financial situation, including an additional $90 million in its debt load as reported by CBC Radio's David Cochrane, may have a spillover effect into the wider market. FPI is not only the major fish company in the province; it also supports smaller processors in a variety of ways.

The fall and winter may well be extremely difficult politically for the provincial government.
Taylor has spoken openly of the overcapacity in the fishery. At the same time, Premier Williams has committed to assisting the community of Harbour Breton cope with the closure by FPI of the community's fishplant. While it is far from conclusive, these contradictory opinions suggest that there are some significant policy differences within government on fisheries issues.

If real, they would only complicate a looming problem in the fishery that needs to be addressed decisively.

FPI's Rowe departs

Derrick Rowe announced today that he will be stepping down as chief executive officer of Fishery Products International (FPI), effective 31 December 2005.

Rowe's departure coincides with announced a net loss in the third quarter 2005 of CDN$5.1 million. This compares with a net profit of CDN $4.9 million for the same period of 2004. Check the news release, linked above, for a detailed discussion of FPI's announcement.

The announcements of both the third quarter loss and Rowe's departure are accompanied by news that FPI will undertake a further review of its so-called primary group operations to reduce costs and increase productivity. The primary group includes FPI's fish harvesting, processing and marketing operations.

The Ocean Cuisine International division matches seafound demand from customers in the foodservice, retail and industrial sectors with suppliers globally. In September, FPI purchased The Seafood Company, a United Kingdom importer, harvester and processor of shellfish and rebranded the company Ocean Cuisine Europe.

In October, FPI deferred a plan to create an income trust using Ocean Cuisine International, attributing the deferral to a review being undertaken by the Government of Canada of income trusts. The plan originated in 2003, however, ongoing discussions with the Williams administration over the subsequent 18 months delayed implementation of the income trust proposal.

The future would be dramatically different...

Check this suggestion from Responsible Government League (RGL) that calls for, among other things, dismantling the provincial Department of Innovation, Trade and Rural Development.

By the by, the department is commonly known as In Turd, which just proves once again that people need to think long and hard before they develop an acronym for an organization.

RGL's suggestion is radical and worth considering.

Don't hold your breath though. With no signs of radical changes in government policy in the wake of the last election, it is unlikely such a dramatic move will come now that everyone is settling in on The Hill.

The federal provincial balance - a snapshot [amended]

In late 2004, I attempted to estimate the federal-provincial revenue balance, taking into account taxation, government to government transfers as well as government to individual transfers (Employment Insurance).

Transfers to persons, by province, was not available and has not been included in this assessment. Note however, that in some recent years, published reports put the amount of Employment Insurance payments made within Newfoundland and Labrador at more than $900 million.

[Amendment: Lo and behold an e-mail arrived shortly after this was posted giving federal transfers to individuals in the province, as well as other calculations. In the table below, I have added in the transfers to individuals only. The table I received included a raft of other payments, although it didn't include actual federal spending on salaries, procurement etc.]

The data that resulted, while estimated, provided a very interesting snapshot for one year for which information was readily available. The results yield a number of interesting observations:

Observation 1. In FY 2002, the federal and provincial governments generated approximately the same level of taxation revenue from Newfoundland and Labrador. Each order of government derives tax revenue and other revenue from economic activity within a province intended to fund programs and services of that order of government.

For the purposes here, consider that the federal taxation revenue is intended to be the contribution of Newfoundlanders and Labradorians toward the operation of all federal programs and services.

Observation 2. From its own-source and transferred federal revenues, the Government of Newfoundland and Labrador received 79% of all government taxation revenue in FY 2002. See Note 2, below.

Observation 3. This assessment does not take into account federal spending in Newfoundland and Labrador for program and service delivery, including Employment Insurance. Therefore, if the value of federal salaries, capital spending, purchase of goods and services and transfers to individuals exceeds $1.057 billion, then it can be reasonably concluded that Newfoundland and Labrador was a net beneficiary of federal-provincial transfers in FY 2002.

In other words, Newfoundland and Labrador, its government and residents, received more from the federal government than it contributed in locally derived taxation income.

Observation 4. This assessment does not include non-domestic taxation, such as NavCanada fees. These have been the source of some controversy. It has been noted elsewhere, such as an assessment prepared for the Government of Newfoundland and Labrador, that these fees do not provide a net profit to the Government of Canada and its agencies.

Observation 5. It would be appropriate to provide a balance of payments assessment for Newfoundland and Labrador to determine a more detailed perspective on the provincial economy. This is beyond the scope of this posting, but would incorporate a more detailed assessment of federal and provincial taxation and transfers, as well as import/export data, debt, debt servicing etc.

New - Observation 6. From Line G, it is clear that Newfoundland and Labrador received from the Government of Canada almost $1.0 billion more in FY 2002 than it contributed in taxation and other similar revenues. More money comes into the province than goes out.

It is important to remember that, as a general approach, half of taxation and other revenues in the province should represent the revenue to operate the provincial government, while the remainder represents the amount that is Newfoundland and Labrador's contribution to operating the federal government.

Newfoundland and Labrador Government Revenues (Estimate) FY 2002
(Source: Dept of Finance, Government of Canada; Dept. of Finance, Govt of Newfoundland and Labrador)

A. Total Federal Revenue (All tax sources):

$ 148, 577, 000, 000

B. Federal Tax Revenue per capita:
$ 4, 951 ^{Note 1}

C. Total Federal Tax Revenue, NL:

$2, 584, 352, 686

D. Federal Transfers to Government NL :

$1, 526, 900, 000^{Note 2}

E. Balance:

$ 1, 057, 452, 686 ^{Note 3}

F. New - Federal Transfers to Individuals:

$1, 997, 859, 000

G. New - Net (surplus)/deficit:

($940, 406, 314)

H. Total Provincial Revenue (Own-source):

$2, 521, 010, 000

I. Total Fed + Prov Revenues:

$5, 105, 362, 686

J. Total Provincial Expenditure:

$5, 012, 981, 000^{Note 4}


Notes:

¹ The federal per capita revenue likely exceeds the actual figure for Newfoundland and Labrador since the figure used here for total revenue was derived on a national basis.

² Equalization plus CHST. Gov NL received 79% of all government revenues (Fed Tax Rev + Provincial Own Source) from within Newfoundland and Labrador in FY 2002.

³ Balance represents any amount remaining in federal tax revenue from Newfoundland and Labrador once transfers have been removed.

⁴ Gov NL total expenditure represents 98% of all government revenues from sources within Newfoundland and Labrador.

Measuring up - Kiwi-style

Courtesy of an unusual blog, here is a link to a recent installation of artwork in a men's lavatory in New Zealand.

Seems it is a trend in some places to entertain or otherwise distract gentlemen answering nature's call.

This particular installation demonstrates an accurate assessment of male psychology.

A trading nation - Newfoundland and Labrador trade with the world

Export Development Canada [EDC] predicts that exports from this province will fall by 5% in 2005 from 2004, with a forecast for further declines through the years beyond.

Energy accounted for 52% of exports in 2004 and is expected to decline by 6.7%. EDC forecasts oil prices to average between US$55 and US$65 per barrel in 2006. The forecast also notes that while high oil prices will continue to benefit the province, a shift in markets from some oil from foreign to domestic Canadian markets will reduce the export value. Domestic exports are obviously not included in the forecast since it is a prediction of non-Canadian export activity, but EDC is careful to note that this is merely an accounting issue, not a signal of any weakening of the provinces oil and gas exports overall. Export of refined crude from Come by Chance is reportedly down 10% over the same period in 2004.

The value of fish exports, which make up the bulk of the provinces agri-foods exports, is expected to fall to 0.2% of exports, down from 22.6% of total exports in 2004.

As EDC notes: "The drop in 2005 is driven mostly by lower prices; however, volumes are slightly lower as well. Crab prices have weakened considerably since 2004. Export volumes will be down this year as well, with a slight reduction in quota and a late start to the year.

In 2006, crab prices are expected to rebound, with volumes also set to increase. Shrimp prices remain low as they have for some time now. The availability of shrimp is good -– shrimp landings were very favourable last year and the stock appears healthy. We expect landings in 2005 and 2006 to be on par with last year'’s performance and our base case scenario has prices holding steady in 2005 and increasing slightly in 2006.

There remains a downside risk in that if prices fall any further some fishers may choose to leave shrimp in the water. After the large drop in exports anticipated for 2005, EDC Economics expects fish and fish products exports to rise 8% in 2006. The Canada-US exchange rate continues to be a key forecast risk since most of the province'’s seafood exports are priced in US dollars." [Paragraphing changed from original]

On forestry, it is worth quoting EDC forecasts in their entirety, especially in light of the recent provincial government subsidy to Abitibi Consolidated.

"Newsprint exports for the first 7 months of 2005 are down 4% over the same period in 2004 even though prices increased 9% during the same time frame. In addition to sluggish sales, newsprint producers face higher energy and input costs. Fibre costs are up, due in part to a 20% harvest reduction in Quebec, which impacts Newfoundland'’s ability to source fibre.

This year [2005] has become a critical year for the industry in Newfoundland as Abitibi, a key industry producer, announced in July that it was closing a mill in Stephenville, effective in October. Abitibi also announced the closure of one 60,000-tonne machine in Grand Falls-Windsor, leaving one machine in operation. Abitibi is planning to take out 500,000 tonnes or 4% of its North American capacity by the end of 2005 in an attempt to push up prices, and half of that value rests in its Stephenville and Grand Falls-Windsor operations.

EDC Economics estimates this could reduce Newfoundland'’s newsprint output by as much as one third. There will be some newsprint reduction taking place in 2005, but most of the volume decrease is expected to happen in 2006. As a result, forestry exports are set to decline by 3% in 2005 followed by a much bigger drop of 18% in 2006." [Paragraphing changed from original. Emphasis added]

Export and import statistics from the Government of Newfoundland and Labrador add some colour and context to the EDC assessment.

The United States was the destination for most local exports, amounting to $2.7 billion in 2004 and includes exports of oil, refined petroleum products, newsprint and fish. That is down from $3.2 billion in 2003 and a peak of $4.1 billion in 2002.

China, Spain, Germany and the United Kingdom round out the top five export destinations. Ireland doesn't make the top 10 list presented by the provincial government.

Import information may surprise some people. Iraq is the number one source of imports, by dollar, coming to about $1.082 billion in 2004. This is entirely comprised of oil that is refined in the province and exported, primarily to the United States.

Russia, the Republic of Korea, the United States and the united Kingdom round out the top five sources of imports, with Russia accounting for almost half a billion Canadian dollars worth of imported goods and services in 2004.

Overall, Newfoundland and Labrador has a trade surplus with destinations outside Canada. The province imported slightly more than $2.5 billion of goods and services in 2004, compared to total exports of more than $4.5 billion.

A trading nation - Newfoundland and Labrador trade within Canada

Interprovincial trade and Newfoundland and Labrador

Newfoundland and Labrador has always been a trading nation and it remains so after Confederation. The local population is too small to enable the local economy full use of all resources within the province. Therefore our economy, and our prosperity, is built on trade.

Figures from the Government of Quebec (Fiscal Year 2001), bear this out. There may be more recent figures but these are the ones that were most readily available.

Newfoundland and Labrador exported $3, 003.2 million of goods and services to other provinces in Fiscal Year (FY) 2001. The destination of most of those goods was Ontario, which imported $1, 132.5 million of locally produced goods and services. Quebec was next with $646.8 million, followed by New Brunswick with $641.6 million.

The province imported $5, 390.5 million worth of goods and services from the rest of Canada in FY 2001. Newfoundland and Labrador imported $2, 342.4 million in goods and services from Ontario, the largest provincial trading partner. Quebec was next, at $1, 172.4 million, followed by Nova Scotia at $686.2.

Within Canada, Newfoundland and Labrador experienced a trade deficit that year, importing $2, 387.3 more than it exported.

Behind the Green Curtain - amended - Updated

Sullivan financial statement masks deeper issue

Finance minister Loyola Sullivan today released an update on the province's fiscal position. This was done outside the legislature; no word yet on when the session will begin but guesses are that it won't be much before the end of November.

Sullivan said that a combination of increases in different revenues plus changing the way offshore revenue money is accounted have reduced last spring's budgeted deficit of $492 million and turned it into a modest surplus of about $1.5 million.

Other changes to the financial situation include marginal declines in revenue from gasoline taxes and equally marginal increases in operating budgets due to increased gasoline and heating oil prices.

In the news release and actual statement, government is claiming credit for greatly improved finances on the one hand and warning that a major problem remains in the form of the provincial government's $12.0 billion debt.

What all that means is actually pretty simple. If we add up all the provincial government's assets and liabilities on an annual basis, we wind up $1.5 million to the good.

Look more closely at the financial statement and something else pops up: if all other things stay the same, when Loyola Sullivan checks his bank balance next March, he'll find over $300 million in cash he didn't plan on having at hand.

The forecast accrual deficit - the $492 million figure - was comprised largely of unfunded pension liabilities. In other words, the provincial government forecast that while prudent financial management would see government setting aside over $450 million to cover future expenses from public sector pension plans, it wasn't able to do so.

Therefore, there was a large deficit totaling almost $500 million. Just remember, though, that this is a theoretical deficit annually; no money was borrowed to cover it - government actually planned to borrow only $62 million in new money to pay for day-to-day operations.

Remember as well, that with all the new revenue, government hasn't really put anything toward dealing with the unfunded liabilities beyond the modest amounts already negotiated. Nor has government done anything at all to deal with the $12.0 billion accumulated debt other than use it as a boogey man to frighten people who might ask for extra spending this year.

That is the deeper problem with Loyola Sullivan's financial management over the past three years.

Under the Williams administration, Newfoundlanders and Labradorians have no idea what the government will do with the extra cash. In fact, the way Loyola Sullivan likes to report the numbers, he is actually hiding the true picture, all the while claiming he is not telling the fables of some previous provincial finance ministers. He isn't - that much is true. Sullivan simply tells other fiscal fibs.

When the federal government ends up with massive annual surpluses, it has already told people how that money will be spent. Since the late 1990s, the surpluses that in some years add up to almost the total debt in this province have been spent paying off Ottawa's own debt, increasing spending on programs like health care or a combination of the two.

Predictably, Liberal leader Gerry Reid wants to spend the money on something here and now. He has spoken of running small deficits on a cash basis.

In doing so, Reid plays right into Loyola Sullivan's hands. Sullivan's presentation of the province's finances is designed to hide the extra cash in the bank every year. By calling for deficits, Reid allows Sullivan to simple hold up the debt-on-a-stick, wave it about and frighten people, all the while shaking his head at how the approach Reid proposes is what created the province's financial mess in the first place. Sullivan can and will heap praise on himself for having balanced the provincial books in two years when they predicted it might take eight years.

The balanced-books miracle is entirely made up, of course, at least insofar as Sullivan and Premier Williams claiming credit for it is concerned. The PriceWaterhouseCoopers report two years ago deliberately underestimated the short- and medium-term provincial revenues to make the province's financial problems look far worse than they are. The revenues we have actually seen were predictable, even two years ago and even on a conservative - i.e. prudent - basis.

The source of the added cash is also worth noting. The new money does not come from the January deal with Paul Martin. The added money, both the royalties and the added corporate taxes, come entirely from the Real Atlantic Accord from 1985. The royalty regimes put in place by successive Liberal governments, building on the landmark deal under the Peckford Conservatives is pushing the provincial government well into the black. Taken together, the Real Atlantic Accord will add $302 million to the provincial accounts. On an accrual basis, those figures will total at least $330 million above the numbers in the spring budget. Note that this is almost bang on the offshore revenue projections made previously on the Bond Papers.

In fact, aside from the annual draw-downs allowed under the January deal, the interest income from the federal Equalization-like transfer payment is entirely absent from this little financial up-date. Media reports have quoted provincial officials to the effect that the interest on this money is accumulating at a rate of $5.0 million a month. That works out to about $45 million by the end of the fiscal year and that money, in its entirety is available for the province to spend.

Sullivan makes no mention of it at all.

Both Reid and Sullivan miss the point, however, the latter by obvious design.

The public discussion should be about how to be dispose of that cash in the long-term interest of the province. Loyola Sullivan's statement should have contained an honest presentation of the province's finances and a clear statement of what government will do with the hundreds of millions in extra money it has and will have year after year into the future.

Instead, most Newfoundlanders and Labradorians will be bamboozled by numbers. They will be denied the chance to participate in a substantive public policy debate. In the end, and from the perspective of truth in accounting, it is hard to distinguish Sullivan from some of his immediate predecessors.

If past experience is any guide, though, we can make a reasonable prediction as to what government will do with its added cash. Come January 2006, there will be a spending spree, as there was in January 2005. What is genuinely a significant cash surplus will be spent on one-time projects, some of which may be of dubious long-term value. The penchant of this government for quick cash-fixes has been noted here on previous occasions.

And the long-term debt?

It will remain at $12.0 billion, growing steadily each year, all so that Loyola may have a boogeyman with which to frighten the natives.

Update - TD Waterhouse's senior economist made a number of interesting points, but also a number of errors in his comments on CBC radio this morning.

1. As noted above there has been NO action by the provincial government to date to reduce the debt load. The Grimes administration actually managed to retire some of the province's direct debt - a figure the economist referred to when he spoke of a debt t- GDP ratio of 20%. Total and accrual indebtedness continues to climb and will continue to climb under the Conservatives unless corrective action is taken.

2. The January deal is worth more than $2.0 billion. No way. As long as the provincial economy pushes the province off the Equalization rolls, the provincial government will get nothing from the January deal beyond the $321 million already drawn down. The only way to make the deal worth more than the initial hand-out is if oil prices fall well below the TD predictions, i.e. well below US$35, rebounding to US$50.

Yet another who are you quiz

Since this show first aired, I have been a big fan.

Turns out I match up to the guy who is now a congressman (at least on the show).

Of course, these days I am seldom younger than everyone else. *sigh*.

[via John Gushue, aka Toby Zeigler]



The idealistic speechwriter is well-liked by just about everyone. He's known for his excellent writing, sense of humor, and tendency to be clutzy. Although being younger than the rest of the staff, he's often treated as so, much to his dismay.

:: Which West Wing character are you? ::

Chinooks to make come-back?

Sold off to Holland by the Mulroney administration at the same time that the military was organizing a light, heli-mobile brigade, Chinook helicopters may be coming back to the Canadian Forces, according to the Canadian Press.

Other purchases include new transport aircraft and a replacement for the Buffalo search-and-rescue aircraft.

The army needs new heavy helicopters to assist in places like Afghanistan. Contenders for the purchase are said to include the CH-47 Chinook, the CH-53 Sea Stallion and the Sikorsky S-92. Last time I checked, the S-92 wasn't considered in the same class as the other two for sheer lift capacity.

Interoperability with the United States army would favour the Chinook.

The transport aircraft will replace the C-130E Hercules, some of which have been in service since the early 1960s. Most likely candidate to win the competition would be the J-model Herc already in service with the Royal Air Force and the Royal Australian Air Force.

Sheila knew nothing? C'mon.

People sometimes have short memories.

Sheila Copps, disgruntled former Liberal leadership candidate, is intent on contradicting the findings of Justice Gomery in his conclusions about who knew what about the sponsorship scandal and when. Mind you, she has no evidence. She can't even do anything except suggest what might theoretically have happened.

But what about Copps herself, cause after all, Sheila, two can play the silly game she follows in her column.

Let's wander a bit through Sheila's own ministerial appointments.

1993 - 1997. Appointed deputy prime minister to Jean Chretien. For those who may not know, that put her closer to the centre of power and the sponsorship mess (by Sheila's own logic) than Paul Martin ever was.

1996 - 2003 Minister of Canadian Heritage, among other portfolios.

Given Sheila's position in the Chretien administration and her own logic, then Sheila knew all about sponsorship and its irregularities. We know that she was involved in the disastrous 1995 federalist referendum strategy and blew $16 million of taxpayers money on a ludicrous scheme to spread Canadian flags everywhere.

Was that sponsorship money? Nope. Not as far as I know. But it was a monumental waste of public funds.

But the really important question is this: how could the deputy prime minister of Canada - the second most powerful person in the cabinet - not have known about a scheme to defraud Canadians of hundreds of millions of dollars, especially considering the scheme was intimately related to the fight against separatism in which Copps herself was involved?

By the logic Copps herself uses against Paul Martin, then Gomery should have dragged her in the dock along with everyone else.

If the Canadian public are cynical, Sheila, then you ought to know. Your commentaries - and perhaps hypocrisy - fuel their doubts about politicians every time you open your mouth or tap your keyboard.

At least the public can read the Gomery report and understand that he has no ulterior motives in his commentary.

Go read Gomery

As much as there will be a bunch of people running about telling you what Gomery said about the sponsorship scandal, the easiest thing to do is read it for yourself.

Consider this:

"Prior to November 1993 [i.e. under the Mulroney administration] ... the selection and engagement of advertising agencies to assist the government in its advertising activities were openly done on a political basis. ... Advertising and communication agencies having Liberal Party sympathies or connections had little or no chance of getting government business."

"[Then, after the Liberals came to power], what appears to have been a sincere attempt to depoliticize an openly biased procurement policy was subverted almost from the very beginning."

or this:

"Just as it is important to identify persons who failed to fulfill their responsibilities or who might have been guilty of misconduct, it is equally important in this Report to identify persons who, on the basis of the evidence, are innocent of any misconduct or mismanagement. Such persons who, in the publicity surrounding the Commission or elsewhere, might have been accused or suspected of improprieties, are entitled to have any blemishes to their reputations explained or removed."

and this:

"One of the main purposes of a public inquiry is to enable concerned citizens to learn firsthand what occurred when allegations of the improper use of public funds have been made. By following the public hearings they are able to arrive at informed opinions as to who might be held responsible for any errors or mismanagement that might have occurred affecting what the Inquiries Act calls "the good government of Canada." The first role of the Commissioner is to conduct hearings that serve to facilitate the understanding of the public, while ensuring at the same time that the presentation of the evidence is done fairly and dispassionately, to avoid premature or unfounded conclusions from being reached which risk damaging the reputations of persons innocent of any wrongdoing, impropriety or negligence."

What Justice Gomery has accomplished herfulfillsls exactly the mandate he received.

Two down, one more to go.

The Dion thing was scarcely on the blog for five minutes when the first e-mail arrived yesterday from one of three people I expected to hear from in short order.

Number two is over at Responsible Government League in which spleen is vented once more at the evils of Canada and the evils of the central government and well, basically proving Dion's point that there is a lamentable tendency to view everything in Canadian politics as a unity issue.

Now I just have one more voice to hear from, like by e-mail to know I have hit the hat-trick.

Nothing can justify secession in Canada

At the risk of making yet another lengthy post, I thought I'd post this recent column by Stephane Dion that appeared in the Toronto Star.

There's always a chance it will get lost in cyberspace.

_____

Nothing can justify secession in Canada
Stephane Dion says it is time to stop treating all problems as unity issues

_____

Ten years after the 1995 referendum, 25 years after the 1980 referendum, I know that the resurgence of the secessionist debate in Quebec continues to create its fair share of exasperation across the country.

How is it that this old threat to our unity is back again? Many ask themselves what they can do to help in these circumstances. If I had only one suggestion to offer, it would be the following: We need to be fairer to our country.

I have in mind a particular bad habit that is far too entrenched in Canadian political culture. Too often we over-dramatize the normal disagreements that we have in our democracy, while at the same time trivializing the use of arguments for separatism in the course of these otherwise normal debates.

This is certainly the case in Quebec where the separatist leaders never miss an opportunity to turn any intergovernmental disagreement into an argument for Quebec separation. Those tensions inherent in any federal system are always portrayed as proof that Canada is dysfunctional, unfair and insensitive to Quebec.

But now, how many times have we heard pro-Canada politicians - and not only from Quebec - using the same argument? Oh, they will not say: "I will become a separatist if things do not go my way." But they will be quick to say that separatism will have a stronger case if they don't get their way. The last example that comes to mind is Conservative leader Stephen Harper's recent intervention in the House of Commons when he described the federal initiative to help provincial day-care systems as a potential threat to Canadian unity.

In 10 years in politics - eight as unity minister - I have heard this argument in the strangest situations: from the Pacific salmon to the Atlantic cod. Is there any other country where the ratification of an environmental protocol (Kyoto) has been described as a unity issue?

Recently, we have seen adults claiming the unity of the country is threatened because one of our provinces is becoming too rich! Or because the federal surpluses are too big! Only in Canada, I tell you.

And you have the opposite argument: those politicians who cannot refrain from celebrating a political result that went their way as the proof that "Canada works." Because a different outcome, obviously, would have been the proof that Canada does not work.

And if you show that you do not take these separatist musings seriously, you may be accused of insensitivity. I remember once in Alberta, a journalist asked me if I thought that Albertan separatism was a serious threat. I answered that I had no doubts about the iron-clad commitment of Albertans to their country. The headline the next day was: "Our unity minister doesn't care about Western alienation." I suppose that I should have expressed doubt about Albertans' loyalty to Canada in order to show that I care about this part of my country.

Ah, the Canadian media and their frenzy for anything that can be twisted into a unity problem. Okay, I won't go there this time.

If the Canadian political class continues to portray Canada as a fragile country, a loose union, always close to disintegration at the first difficulty, how can we hope that the separatist debate will end in Quebec?

There will always be some disagreement down the road, some source of frustration that the separatist movement will describe as the "new" proof that Canada does not work. And what will be the counterargument? To find an agreement that proves Canada works - at least until the next disagreement? That is a never-ending cycle.

One of the worst examples that I have seen about how separatism is trivialized occurred during the last federal election when I discovered that some NDP candidates in Quebec were acknowledged separatists. Today, I ask NDP leader Jack Layton to declare that from now on a commitment to Canadian unity is a sine qua non condition to be an NDP candidate. This is the minimal respect a national leader owes to Canada.

In fact, it would be so simple to stop showing such disrespect to Canada. We just have to say that nothing justifies secession in Canada. Nothing in Quebec. Nothing in any other province. And to hold to that, despite the inevitable disagreements that will arise in our lively democracy.

And then, yes, we will show respect for Canada. Believe me, this respect will be contagious.
_____

Stephane Dion is the federal Minister of the Environment.

Le maudit CBC

In a break from watching the two-part CBC special on the 1995 referendum, I decided to check out the program's website.

It's pretty thin in many respects.

Then I came across the bit titled "Tobin takes charge". Scary thought that it is.

But try this little quote on for size:

"From Halifax to Victoria, a huge campaign is organized: thousands of Canadians send postcards to Quebecers with messages of friendship, pleading with them not to give up their country." [Emphasis added]

Was this written by someone whose memory stopped on 31 March 1949?

I trust the rest of the program does not suffer from a similar lack of adequate research.

Up the dose, Sheila

When it looked like the Gomery Commission was going to skewer the Martin Liberals, Sheila Copps and her associates danced with glee on the grave that had yet to be dug.

Now that it looks like Gomery won't follow the course Sheila et al. would have preferred, she is seeking to sink the thing with rumour, speculation and innuendo.

The Sun, of course, is that bastion of journalism that tried to paint a bull's eye on people like Rick Mercer by outing their morale-boosting trip to Canadian soldiers in Afghanistan.

Sheila, of course, is the bitter Liberal leadership candidate who got creamed by Paul Martin in the leadership run and then capped it off by self-immolating with a bad tactical decision during a nomination fight in her own riding.

The former deputy prime minister during the near-debacle referendum a decade ago and the one who came up with the Print Millions of Flags to Save Canada nonsense is now attacking Paul Martin with a degree of hatred that would make Brian Pallister look like a wuss.

Somehow Sheila seems to think that a well-respected judge with no known partisan affiliations and a process that included Brian Mulroney's former chief of staff as one of the inquiry's lead counsel will now do something other than tell the truth.

Give it a rest, Sheila.

Or up the dose on the meds.

Looks like Rick Mercer made a good call, albeit for other reasons.

SQFT egale square head

In the Canadian Forces, Secteur du Quebec de la Force Terrestre, the Army's Quebec region is known by its acronym SQFT, sometimes pronounced square foot.

Here, in French, is a brief story on results of as recent CROP survey of Francophone recruits being trained at the Canadian Forces Base, Valcartier .

It reveals a group of recruits prone to disobedience, who are less tolerant of immigrants and less supportive of sexual equality than their Anglophone counterparts.

Seems that in Quebec, SQFT actually stands for square head.

The Constitutional Fish - the decision

On Friday, October 28, 2005 Rick Bouzan and George Nichol were found guilty of breaching federal fisheries regulations during the 2004 recreational fishery.

The decision by Provincial Court Judge Harold Porter was covered by news media, although both the Telegram and Independent versions didn't accurately reflect the decision. Both included comments by the lawyer for Bouzan and Nichol and comments by the defendants that the decision was based, in part, on the fact that Newfoundland and Labrador was a colony at the time of Confederation.

Here is a summary of the decision rendered by the court, taken from the written decision. An online version will be available from the Canadian Legal Information Institute, CanLII.

The decision can be broken into two parts. First there is the offense itself, which was a breach of federal fisheries regulations requiring that fish caught had to be taken on being landed. The purpose of the regulation, while not mentioned in the decision, appears to be aimed at preventing highgrading. This is the practice of catching many more fish than allowed (in this case 15) and the keeping only the best ones.

Both the prosecution and the defence filed an agreed statement of facts. Here it is in part:

"As the Officers were coming alongside [the defendants' boat] they told both gentlemen not to bother tagging any more fish. Officer Walsh who was at the front of the patrol boat observed Mr. Nicholls tag approximately 3 to 4 codfish while the other man, Mr. Bouzan, had not tagged any fish as he had just found his tags and had them placed on the seat of the boat next to him.

Once alongside Officers Walsh and Ward told the men they would be conducting an inspection of their vessel. Officer Walsh obtained both men's Department of Fisheries and Oceans 3Ps recreational cod licenses and began filling out an inspection form. Officer Ward next asked the men to hand over their catch so that he could inspect it.

The men handed over a fish pan full of cod with one redfish in it as well to Officer Ward who then inspected the catch aboard the patrol vessel. Twelve cod fish were found tagged with tag # 012259 belonging to Mr. Nicholl and 17 cod fish were not tagged. No cod were tagged from Mr. Bouzan's license which was tag # 010857. Fifteen of the cod had been gutted prior to tagging and appeared to the officers to have been caught for some time.

Officer Ward asked the men when they had come out fishing and both men said they had been out "most of the day." No fish entrails were present aboard the vessel or floating in the water next to the boat. The men said they were just going to stop fishing and head to port. Both officers told both men they could return to port and that they would follow them in.

After arriving at a wharf in Little Bay East, Newfoundland both officers separated the tagged cod from the untagged ones and then headed over to where both men landed and returned the tagged cod and their fish pan to them. At that time both officers identified themselves to both men with their badges and identification cards.

Officer Walsh told both men that an investigation had been initiated. At approximately 1510 hours both men were read the standard caution by Officer Walsh and rights to council [sic] were extended. Both men said they understood all parts and did not want to contact duty council [sic] at that time.

Officer Walsh told both men that they may be charged with failing to tag cod immediately after catching the cod. Officer Walsh told both men that their untagged cod was seized and that their unused cod tags would be seized as part of the investigation. Both men supplied Officer Walsh with their tags at that time. All fifteen of Mr. Bouzan's recreational cod tags were seized and three unused tags were seized from Mr. Nichol's license.

After caution Mr. Bouzan said, "I didn't read my license. It's my own fault, I should have read the fine print." Mr. Bouzan said this after the officers told both men that all cod caught must be tagged immediately after catching the cod while recreational cod fishing. Both men were told by the Officers that they would be in touch with them at a later date. Both officers then left the area and continued their patrol.

The seized fish were stored at the DFO Warehouse in Marystown and the unused tags were stored at the DFO Office in Marystown. It was a condition of both mens''’ license that any cod caught must "‘be tagged immediately after it is caught in the following manner: A non- used tag, issued with this license and valid for the NAFO division being fished, must be affixed through the gill and mouth of each Atlantic Cod. The tag must be properly sealed such that the tag cannot be re-opened or removed."’ Each license had 15 tags issued with it."”

That's pretty straightforward and, on that basis, the men were found guilty. The court was asked to consider a constitutional challenge to the jurisdiction of the Government of Canada over fisheries within three miles of the low water mark around Newfoundland and Labrador. The first question posed was as follows:

"Does the government of Canada have the jurisdiction to regulate the catching of groundfish, including cod, within three miles of the coast of Newfoundland and Labrador going from headland to headland?"

On this matter, Judge Porter concluded based on case law before and after 1949 as well as the Terms of Union that the Government of Canada has exclusive jurisdiction over fisheries matters in and around Newfoundland and Labrador. The court was asked to consider a second question, namely:

"If the government of Canada has the jurisdiction to regulate the catching of groundfish, including cod, within three miles of the coast of Newfoundland and Labrador going from headland to headland, does that jurisdiction include the right to regulate the catching of groundfish, including cod, for personal consumption?"

Judge Porter found that the federal jurisdiction over fisheries matters and that this jurisdiction includes fisheries within three miles of Canadian land as well as offshore islands. He rejects the notion of a three mile limit as having any grounds since the provincial government exercises jurisdiction for bird and land animal conservation over islands which are more than three miles from shore.

As well, he found that established case law held that a provincial government has jurisdiction over matters within its legislative competence within its boundaries. Since the Terms of Union do not include fisheries matters within the jurisdiction of the Province of Newfoundland and Labrador, the issue of where the provincial boundary exists isn't relevant in this matter. As to the issue of using fish for personal consumption, it is worthwhile to quote the decision in its entirety:

[73] The third part of the second question narrows the focus to not just fishing for cod, but to fishing for cod "“for personal consumption"”. In this regard, say the Defendants, they are in the same situation as the Powleys were. The Powleys were Metis in Ontario who said that they had a right to take moose, withoulicensece, for personal consumption: see Powley [2003] 2S.C.R. 207.

[74] Contrary to the Metis in Ontario, there are no indigenous aboriginal communities on the island of Newfoundland: see Drew [2003] N.J. 177. Even if there were, there is no suggestion that the Defendants claim membership in such a community.

[75] As a matter of Crown honour, say the defendants, the federal government must have a referendum among the residents of this Province before they can find the jurisdiction to regulate the taking of fish for personal consumption.

[76] This position is untenable: there was a referendum prior to Newfoundland entering Confederation. On entry into Confederation, Newfoundland assumed the same position as if Confederation had been achieved in 1867. As earlier discussed, this included recognition of exclusive jurisdiction over the fishery in the Federal Crown. There is no reason to distinguish between fishing for trade, barter, or personal consumption.

At no point in the decision did Judge Porter make any reference to the notion that Newfoundland and Labrador was a colony at the time of Confederation. Since I wasn't in court, I cannot say for certain he made no mention of this issue in his remarks.

But let's be clear: there is nothing about this issue at all in the written decision.

Judge Porter's decision is based on both the agreed upon statement of facts presented by both parties in court with respect to the offence. On the constitutional issues, Porter relied on case law, the Terms of Union and a variety of statutes and proclamations dating back to the 18th century.

Nichol and Bouzan were fined $100 each for having untagged cod in the possession. in news reports, Bouzan has indicated the case has cost the two defendents $11, 000 so far. They intend to appeal the conviction.

It will be interesting to see what happens when and if the matter gets to the Supreme Court of Newfoundland and Labrador, Court of Appeal. I'd wager the thing will never get to thSuprememe Court of Canada.

The whole thing is black letter law.

Sunday morning, 8:00 AM, Quality Time

I once suggested a variation on this Bloom County panel as a billboard ad. The client didn't take it, but hey not every idea passes client-muster.

After all these years, I still find it both funny and fitting at the same time.

Piece and quiet, a cup of hot coffee and something decent to read.

Saturday Night, 10:00 PM, Same ole Spindy

It's actually a great thing to be able to get the local hotbed of investigative reporting on Saturday night while most people wait until sometime Sunday to find out how far short of its own billing the Independent has fallen again this week.

A cuppa Tim's finest, some peace with the door locked and the Spindy.

The best thing about the Spindy - every single week, without fail - is Paul Daly's spectacular photography. It remains the only positive reason to read Brian Dobbin's rag. Check out the page one shot of Constable Stephen Knight. You just can't get that composition and clarity anywhere else in the province. Heck, I don't think you find Daly-quality shooting in most other papers in the country. (Photo: Paul Daly/The Independent - from last week)

On the front page there's a really puffy, flattering profile of PetroNewf boss Ed Martin. In a week where both Martin and his boss the Premier talked a bit about this whole idea of taking the Crown hydro corp and sticking it in the oil patch, the Spindy didn't see fit to dive into some detail. Poke and probe a bit. Maybe take a critical look. Nope. More butt-kissing fluff of the kind we got when Danny re-appointed his ole buddy Dean MacDonald to run the board over on the Crosstown Arterial.

Try and find anything substantive on the Abitibi subsidies and you are excrementally devoid of good fortune. The story that seems to mark a real turning point in the Premier's popularity and political life garners a tiny mention in managing editor Ryan Cleary's column. On the front page, there's instead a focus on a mill in New Brunswick with some references - unenlightening ones at that - to Stephenville. Cleary was in Stephenville for the announcement, too.

Cleary does bitch about other media outlets taking a couple of Spindy stories and covering them as well, without giving the Spindy any reference. That happens all the time, as Ryan well knows, especially when the stories he mentions have been covered and will be covered in any event by everyone else, anyway. The Spindy didn't break anything here of substance so he really can't complain. What he should do is thank his lucky stars other media outlets don't point to the number of times the old Spinner has cranked out stories based on a sole source that turned out to be completely lacking in any substance or foundation.

My fave front-pager this week is the result of an Access to Information Act request that netted a whole bunch of e-mails the Prime Minister got about the offshore oil deal. Wow. Like we needed the Spindy to tell us - for the umpteenth time - about Danny's Greatest Triumph.

There's a page two story on the Bouzan conviction that, like its Telegram counterpart demonstrates that the two reporters didn't actually sit in court for the decision or if they did, they missed the pretty straightforward reasoning of Judge Harold Porter. (More on that tomorrow, since I actually have a copy of the decision.)

There's a decent story on page 3 about the Royal Canadian Legion and the closure of 15 branches in the past year. There's also a little piece about the lack of information Canadian officials have on oil spills outside the 200 mile economic zone. Hint: The Spindy hates DFO for a whole bunch of reasons, so don't ever expect to see a balanced story on the federal fish department.

The Spindy decided this week to do yet another attendance poll of federal members of parliament from this province. Loyola Hearn and Norm Doyle top the list. But hey. If they spend so much time in Ottawa, why exactly do they claim really high amounts of travel from the taxpayers? For those who missed it, the most recent figures are here for Messers Hearn and Doyle. High attendance and high travel bills seem to contradict each other, but then again if the Spindy actually poked at these two former Peckford cabinet ministers, they wouldn't be able to rely on them for anti-DFO quotes every week or so.

Incidentally, given the rules under which those claims are filed, you and I can't get access to the receipts for the claims as we can for any other senior official of government. Heck, we can't even get the kind of detail available from the fed's Proactive Disclosure. It's worth taking a look at those sections of departmental websites sometimes to just how little actually does get spent for things like travel every quarter of the year.

Fight your way through to the editorial page and find that Brian Dobbin is back, this week spilling ink about the lack of capital in the province. He takes a smack at the fact Canadian investment money seems to sit in Toronto and then launches into a little story about his travels to places like Hong Kong and the United Kingdom looking for investors.

Don't expect any insights here; Dobbin neglects to point out that having a thriving and diverse private sector would actually give investment capital, as would creating jobs and wealth such that ordinary people could invest in strong local, free enterprise.

Problem with that approach is that it would lead to Dobbin doing two things he would never do: a. criticise the PetroNewf decision of his new patron on the Ireland thing and b. lead to questions about how much government capital it takes to actually run a local bastion of capitalism. I am thinking Gander and Brian's hatred of the CBC, in case one example isn't coming readily to your mind.

Oh. But wait, Brian doesn't buy shares in anything himself since he feels that the value is often hyped as opposed to being substantive. Hmmm. An interesting attitude. Not one I'd agree with in every case, but it is curious. I'd love to hear brian explian to his uncle, Craig, that shares in the second-largest helicopter company in the world are built on a mound of crap.

Well, the Tim's was good as usual. The Spindy was not, as usual, except for Paul's photography and Stephanie Porter's reporting. Take away the stuff they lift from the Toronto Star and some New Brunswick papers and the paper thins out quite a bit after the op-ed page.

What a way to spend Saturday night.

I need to check the guide.

Maybe there's a Golden Girls rerun on.

Calvin and Hobbes

History is the fiction we invent to persuade ourselves that events are knowable and that life has order and direction. That's why events are always reinterpreted when values change. We need new versions of history to allow for our current prejudices.

- Calvin, to Hobbes

This strip is apparently the most successful cartoon one since Peanuts. I got hooked on it at some point and was mighty sad when it ceased publication.

Calvin is the stereotypical boy, but with an adult's sense of the world. His tiger, Hobbes, was apparently named for the English philosopher who told us that in the state of nature life was poor, nasty, brutish and short.

I have used Calvin sometimes in my posts and people might find the references a bit obscure or odd. So as I post this on Friday night - dated ahead for sticklers - I thought I'd share a little cartoon and one of my favourite Calvinisms.

A blow for plain English

When I can get my hands on an electronic copy I'll post it here.

If I get a link, I'll post that.

But anyone who wants to read what is undoubtedly a straightforward legal decision written in plain English, check out Judge Harold Porter's decision today in the case of R v. Bouzan. Click here for an earlier posting that gives some detail of the actual constiutional provisions, that is actual as opposed to the goof-ball interpretation Bouzan and da byes were foisting.

Rick Bouzan is the executive director of something called the Newfoundland and Labrador Wildlife federation. He's a close associate of Jim Morgan and among the crowd of them there's twice as many groups that they represent all clogging call-in shows in favour of the Damn-Fool Fishery (copyright pending).

Anyway, Bouzan and a fishing companion were caught with untagged cod in their boat during last year's recreational fishing season. They tried to turn the whole matter into a constitutional issue by claiming that since they were only 500 metres offshore, the feds didn't have jurisdiction. Provincial boundaries extend out three miles.

Seems their legal help (no, it wasn't Lewis Tully) didn't actually read far enough through the constitution. As any lawyer worth 20 bucks and a pint at the Duke will tell you, the fishery is entirely in federal jurisdiction. The provincial boundaries don't enter into it.

(Left) Lewis Tully, nightschool-trained lawyer and erstwhile Ghostbuster.

Da byes were slapped with a fine of $100 each for violating the appropriate regulations and emerged from court promising to take their fight all the way to the Supreme Court of Canada.

We can only hold our breath waiting for the peals of laughter from the learned justices as yet another dingbat constitutional case comes their way.

In the Land of Irony

At the risk of not using the word "irony" correctly, I note this post on Jack Harris' resignation as leader of the provincial New Democratic Party. At least, I am confident that in this instance, this word doesn't apply.

It is passing strange that someone who enthusiastically supports [but in a completely non-partisan way] a federal political party that repeatedly demonstrates its inability to connect with Canadian public opinion beyond a small portion presumes to criticize the NDP for the same thing on a local level.

Jack's departure does indeed mark the passing from public life of someone who has served longer in the current session of the House of Assembly than most others. The exceptions would be Tom "Backupable" Rideout and Jim Hodder, both of who were first elected in the 1970s. They had a break in their service; Jack's been sitting continuously in the legislature since the early 1990s.

The provincial New Democrats have enjoyed some measure of success over the past 20 years, managing to keep two members in the House for a significant chunk of that time. They just haven't managed to widen their appeal beyond a couple of seats. I'll leave it to a full-time political scientist to delve into the reasons for that inability to climb beyond the NDP's current status.

A more interesting thing to ponder is going to be Jack's replacement. The Liberals are having a hard time getting anyone to declare an interest in their head-honcho job. We probably won't hear a name or two until the spring. In the NDP case, aside from somebody like Wayne Lucas, there doesn't seem to be anyone who might want to lead the Orange Machine provincially.

Maybe Jack's departure, which doesn't include resigning his seat, will end speculation Danny was about to appoint his former law partner to the provincial court bench.

Disincentives

Something about this just seemed appropriate today. Go check the rest out at Demotivation, Inc..

The hard and the easy: Abitibi and government subsidies

In dealing with Abitibi Consolidated, the Williams administration faced a Hobbesian choice. Had it followed through with Premier Danny Williams' pledge from July, mills in Grand Falls-Windsor and Stephenville would now be shutting down with the loss of more than 700 jobs and the loss of over $500 million in newsprint sales from the local economy.


With the choice it made, the Williams administration is committed to subsidizing a particular company at a rate which exceeds or almost exceeds the government revenue generated by the company.

Connie expense accounts

In a post Rarely Graced by Logic, Liam O'Brien claims a number of things that should strike a reader of the post here on Dave Dingwall's expenses as a little bizarre.

First of all, O'Brien claims the post stated that Dingwall had been exonerated by two audit reports on his expenses at the Royal Canadian Mint.

What it actually pointed out was the huge gap between what Connie partisans had claimed to be factual and what the facts were. The post was less a straight-up defence of Dingwall as a critique of bad political communications by Connies like Brian Pallister.

Maybe that wasn't clear.

Maybe it struck too close to home.

Second, O'Brien issued a few challenges in between following a now shop-worn tactic of attacking the person when he can't refute an argument.

One challenge was to point out any case I had where I suspected a Conservative member of parliament might have submitted dubious expense claims or, as in the cases - plural - I'll toss him, of where the size of the claims raises some fairly obvious questions.

Oddly enough, this case was covered in what I suspect is O'Brien's favourite newspaper, the pink white and green Spindy back in May.

Here's the link to my original post.

"Why then did Mr. Doyle rack up $172, 904 in travel expenses?

And why did Loyola Hearn cost taxpayers $164, 159 for travel?"

These two Conservative members of parliament live in ridings that are easily accessible by air and car and yet their travel claims look like they were heading from Ottawa to Alert and back again. Every weekend.

Even after we allow that Hearn lives in Renews, about two hours south of the riding he represents, his mileage shouldn't be pushing his travel claims into the low six digits. Since he and benchmate Norm Doyle both know when they need to travel back and forth to the riding, surely they could book some seats far enough in advance to get a discount.

or stay in cheaper hotels.

or stop gnoshing at Hy's.

To bring those figures up to date, here is the report for 2004-05.

Norm Doyle's travel, as covered by the House of Commons - i.e. you and me - was $157, 768. Bear in mind that for some of that period, Norman was on the campaign trail and off the public payroll. Otherwise, his total travel would likely look just like it did the year before when he was obviously doing alot of stormin' around.

Hearn's travel clocked in at $103, 608. Consider that Hearn was off the payroll for a little while in there. Consider too that his riding is now a heckuva lot smaller than it used to be. He can bicycle from one end to the other in a few hours or better still take the bus to all but a few corners of it. (Pssst. That's a facetious comment about the bike and the bus)

But ya still have to wonder what he was doing to rack up that kind of travel costs.

Before anyone tries to wave a wand and turn that into nothing, look at some other expenses.

Jim Abbott, from Kootenay-Interlake, British Columbia came in between the two of these guys. But he's actually farther away from Ottawa than either of our two Connie friends and he represents a largely rural riding.

Alexa MacDougall, the Dipper from Halifax only spent about $71, 500 to visit her riding once in a while.

And what of Pallister, the Connie from the Prairies? He only spent about $73, 500 getting back and forth to a lovely riding in Saskatchewan.

So why the heck are Mr. Hearn and Mr. Doyle so much more expensive?

Using Brian as the Benchmark, Hearn is 41% higher than Brian while Doyle is a whopping 114% above the Connie Guardian of Expense Account virtue.

Dingwall's expenses - updated

While Connies like this local one, this big Mainland one, and this one, have been attacking former Royal Canadian Mint boss David Dingwall over his expense account claims, two reports released today add up to yet another failure of the Connies to garner any sort of credibility.

(Left) Former Royal Canadian Mint chief executive officer David Dingwall. Photo: Canadian Press

Turns out what they claimed was wrong - substantively wrong.

The big loser here (after Steve Harper) is a guy named Brian Pallister, much loved over at Reflexive Grit Loathing, who was part of the Dingwall attack pack and whose claims have been shown to be, in a word, false. Take a gander at this little piece of video the Connies were passing around earlier in October but which now looks kind of dumb in light of today's revelations.

Updated - Pallister's argument is now that he wants to complain about the rules not about the specific claims made by Dingwall. This is the kind of moving target approach that just doesn't garner cred either. Every time one of your arguments is shot down by facts, you just claim you never argued that in the first place and then pick up on something.

As CBC reports, "Among the [PriceWaterhouseCoopers] audit's findings:

- The $5,800 allegedly spent on one meal was for a two-day seminar involving 24 mint personnel.

- The money allegedly spent on chewing gum was covered under the allowable $20/day incidental expenses.

- There was no evidence of the alleged $13,000 for one day of travel but two claims for $13, 693.83 for a four-day conference in Phoenix and mint-related meetings in New Brunswick, the UK, Switzerland and Germany.

The audit did find that $2,570.66 was determined to be reimbursable to the mint. In addition, $4,198.35 was deemed recoverable due to a clerical payroll error and car insurance prepayments issued by the mint." [emphasis added]

As reported by the Globe and Mail, a second review, carried out by Peter Dey of Osler, Hoskin & Harcourt LLP, "found that the governance process followed by the Mint with respect to the approval and reimbursement of its CEO's expenses was sufficient to ensure that the Corporation's funds were 'expended in a manner consistent with the Mint's policy.' "

Apparently, there's also no evidence that Dingwall dinged the Mint for a pack of chewing gum.

Conservative leader Stephen Harper is quoted as slamming Dingwall for not using "political judgment" in his travel claims and criticizing the reports since the rules were supposedly made by Dingwall.

Wow.

It really isn't clear what "political judgment" Dingwall is supposed to have lacked since the expenses turn out to be legitimate and were totally misrepresented by Harper and his party. It also isn't clear how Dingwall made up his own rules since the claims policy is set by the board of directors, of which Dingwall used to be just one member.

Perhaps the biggest failing of the Connie attack on Dingwall is that the totals are way off. As the Mint board of directors noted in early October, more than 70% of the figure of almost $750,000 Dingwall critics had claimed were "expenses" was actually salaries.

Then there is the matter of Dingwall's ability to actually spend some cash doing what he got paid to do: bring in new business for the Mint. This contract with Thailand is one example.

I am no fan of David Dingwall, but when someone is attacked and personally vilified without any cause other than rank partisanship, the facts of the matter must be presented.

Incidentally, this sort of political attack may go a long way to explaining why the Conservatives have a hard time making any headway with public support. It is much like the Grewal affair.

Claims are made.

A media feeding frenzy ensues.

Then the bubble bursts, in this case the chewing gum bubble.

The facts emerge at which point everyone realizes that the Conservatives are making unsubstantiated claims.

Credibility takes a huge nosedive.

The Conservatives blame everyone else except themselves and their leader.

ACI gets government subsidies for Stephenville

The Government of Newfoundland and Labrador today released some details of an agreement with Abitibi Consolidated [ACI] that will see the mill continue in operation for 15 years.

Under the framework agreement, ACI will commit to maintaining the Stephenville mill at current operating levels (194, 000 metrics tonnes of newsprint per year) for a total of 15 years. The company will also install a new boiler at Stephenville by the end of 2006, at an estimated cost of up to $13 million.

The provincial government will $10 million in subsidies to ACI for Stephenville, either directly or through Newfoundland and Labrador Hydro. The subsidies will total $150 million.

ACI's original proposal, as released by the provincial government in July, was for a 30 year subsidy agreement of between $7.0 ands $14.0 million per year, with an estimated total of between $210 and $420 million. The framework agreement represents an intermediate figure between the extremes for half the term of the original proposal. If the new agreement were extended to the full term of the original proposal, the cost would be $300 million, the estimated high cost option for constructing new hydro generating capacity for Stephenville.

The new framework agreement also commits both ACI and the provincial government to work on a long-term solution to the Stephenville mills power cost problem. That likely means that ACI and the province's hydro corporation will negotiate construction of new power generation facilities on ACI's watershed holdings to feed the Stephenville mill.

Missing from the announcement is any reference to ACI's Number Seven machine at Grand Falls-Windsor which was slated to close. Expect to see the machine shut down with ACI's associated fibre holdings being transferred to address the fibre supply problem at Stephenville.

This agreement is one possible version of a solution suggested in the Bond Papers in July. At that time, we identified the problem as power rates, an issue created under the Grimes administration.

As we put it at the time: "[a]ll things considered, it is possible the provincial government is not as angry at Abitibi as it might seem. Abitibi may be pushing back at a government which was already playing hard ball at the negotiating table. Read between the lines of government's news release, add in a few other considerations and you get the sense the provincial government will be putting some new cash into Abitibi through reduced power rates."

Today's announcement is exactly that: The provincial government will provide ACI with power subsidies amounting to $150 million over the life of the current agreement.

The announcement also contradicts the Premier's suggestion in September that ACI's divestiture of its PanAsia holdings would allow the company to reinvest in Newfoundland and Labrador. As ACI stated at the time and repeated today, its divestiture will provide $600 million which will be used solely to reduce its current corporate debt load. The divestiture is part of a long term corporate plan to reduce debt and improve its financial position. The investment of $13 million for a new boiler represents a marginal amount and can easily be categorized as routine replacement of equipment. It's a normal capital expenditure or capex as opposed to a dramatic change in the Stephenville operation.

Stephenville Limbo

Abitibi Consolidated [ACI] announced today that its mill at Stephenville has been idled as opposed to permanently closed. The CBC story linked above also links to the ACI release, carried by Canada Newswire.

The changed status is a result of an offer from the provincial government that ACI regards as holding the potential to change the financial position of the Stephenville mill.

In substance, though, Stephenville is still closed indefinitely and will only be reopened when and if a successful agreement can be reached.

Workers at the mill are now in limbo, at least until some final decision can be made on government's recent offer.

There was no mention today of the status of the Number Seven machine at Grand Falls which was already scheduled to be phased out.

Further Ferdin Fooferah and some local connections

A simple google search for Pam Ferdin reveals some really interesting links to accounts of her terrorist activities.

Take this link, for example, to a Los Angeles blog that notes municipal employees in LA will be getting security protection at city expense, thanks to threats from Ferdin's Animal Defence League. Seems a someone set off a smoke grenade in the apartment building of one city animal control director.

One union official had her car firebombed by the nutjobs Ferdin leads. Follow the links back to Ferdin's site, as the link suggests, track the account of the protest and you can see some of the extreme language used by Ferdin and company to describe people they have targeted.

Just remember that Ferdin's husband, Jerry Vlasak views violence and non-violence as merely tactics to achieve the greater end.

Then there's this link to a protest against a research facility to be built at Cambridge University. Note the list of speakers include Vlasak and Ferdin, the latter being described as the head of a primate protection outfit. That would be in addition to heading ADL and at least as of August 2004 of running another group that several years earlier had been involved in beatings of biomedical researchers.

The happy couple started their life of protest at least as early as 1996-97, in this turkey protest in which Vlasak was jailed for mischief and Ferdin was identified as the protest organizer. Ferdin is identified as a trauma nurse - which makes sense if Vlasak is a trauma doctor, but prior to this her work was with a New York company that handled animal control on contract from the Big Apple.

Flip around the web a bit and you can come across Animal Scam, a site dedicated to countering animal rights groups.

This is where the whole story gets rather interesting, at least from a local angle and our ongoing hate-affair with veteran money vacuum Paul Watson.

Despite the fall-out from Peter Gullage's piece on Paul Watson and Jerry Vlasak last winter, it seems Vlasak is still on the board of the Sea Shepherd society. This link rather neatly describes Ferdin and Vlasak's status in the United Kingdom. Her Majesty views them as a threat to public order and likely with cause.

Watson also sits on the Sierra Club board. He tried to take over the Sierra Club board during internal elections but apparently failed. in the meantime he is still there. The Sierra Club of Canada is part of the international Sierra Club organization.

These guys are also linked to People for the Ethical Treatment of Animals, or PETA as it is commonly known. Does anyone at memorial remember some guy named Alka Chanda? This guy used to teach at MUN and is now a researcher at PETA.

PETA has the standard anti- seal hunt website, complete with video and the complete lie that "baby" seals are killed.

Check out the Rebecca Aldworth shown on the ice at the end of the International Fund for Animal Welfare video that PETA uses and you will find this. Apparently she grew up in a community of 340 people somewhere in Newfoundland and is now working with the Humane Society of the United States as Director of Canadian Wildlife Issues. She's someone Paul Watson has described as "the world's most active" anti-sealing protestor.

Rebecca also subscribes to Watson's idea that stopping the seal hunt would actually help with cod recovery. Try this link on for size.

Of course in her former life, as president of the student's union at Concordia, Becky found violence of the type she helped provoke last winter on the ice floes to be just a bit too unpalatable.

I guess Beck changed her mind about violence as she got older.

And realized the money to be made from it.

Of course, the nut factory once known as Sir George Williams U has always been a dodgy place.

She seems to have fit right in, once skating topless on the Rideau Canal to protest against fur as clothing.

Personally, I'd like to know what part of Newfoundland she's from.