Hearn to hold breath, turn blue to fight foreign overfishing

Loyola Hearn, Connie fish minister and chronic proponent of something called custodial management is finally starting to talk about the tough action he plans to take.

Bear in mind as you go through this that Hearn not only never really defined what he thought needed to be done, but also kept shifting the sense of urgency around extending Canadian jurisdiction on the high seas out beyond the 200 mile limit.

Well, now we know that one of the actions Hearn plans to take is to close Canadian ports to foreign fishing vessels.

Wow.

Like we haven't seen that schtick before.

Well, at least the schmuck writing the story in the National Post John Ivison hasn't seen it before.

Mr. Hearn has suggested one of the first steps Canada could take is to close Newfoundland's ports to the boats of transgressor nations. With increases in the cost of fuel, many boats now fish off the Grand Banks, offload a catch on the Rock and then return for another. If this ceased to become an option, it could eat into profit margins of foreign boats.

Dear. Mr. Ivison, here's what happens when ports get closed:

First, the foreigners keep fishing and draw their fuel and supplies from St. Pierre. That's the little bit of the European Union found just south of Newfoundland. There is no discernible impact on their bottom line.

Second, local businesses that handled the foreign fish landings and supply the foreigners with food and fuel start feeling a huge pinch that eats into their profit margins.

Then, the ports are re-opened in the face of the political pressure from Newfoundlanders who got shagged around by the tough-talking federal fish minister of the day.

The real import of this Post story, though, is what it tells us about Loyola Hearn and how the Connies will act on their election promise(s) on custodial management and foreign overfishing.

1. Hearn has no plan to extend Canadian jurisdiction other than what was already started by the Liberals.

2. There will be no extension of control outside of international law, i.e. other than through the mechanism the Liberals were following.

3. The best Hearn will come up with - in the interim - is a bunch of tired, old stunts that are like Tobin's Turbot War: full of sound a fury and signifying nothing. We'll close our ports...for a while. We'll send diplomatic letters of protest. We'll hand out more citations and Hearn will trumpet them of proof of his toughness.

And other than that, nothing will happen until the Canadian claim under s. 76 of the Law of the Sea convention, initiated by the Liberals is finally accepted...sometime around 2011.

It's not like I didn't warn about this before January 23.

More problems to come for Williams

The downside for Danny Williams is that he is likely to have more episodes like the one recently where he said one thing about the feds, Loyola Hearn said something different and Danny was left backtracking and pleading with people to trust him.

There are two problems for Danny.

The first one is that, to his credit, Loyola Hearn is a sharp tactical politician. Hearn deflected Danny's amateurish bit of monkey tossing with a flick of his political wrist. Therefore Danny won't be able to handle Hearn as easily as he did John Efford, who it should be said, seemed unable to do anything but stick his neck in every noose Williams fashioned.

The second problem, and the bigger one, is that starting next week the Williams' crew goes from economic development mode (they were never in it any way) to economic crisis recovery and damage limitation mode. Fishery Products International will be the first installment in a major realignment of the province's fishery made necessary by a combination of economic and political factors.

There will undoubtedly be others, like Harbour Breton and Stephenville that, until now, Williams has been able to keep simmering.

Add to that some other problems with the federal government and you have a recipe for Danny Williams' worst political nightmare: a world where he can't get by on glib statements and hollow admonishments to trust.

The upside for Williams is two-fold.

First, he has plenty of cash thanks to booming oil prices. That will let him throw cash at things in the usual short-term fashion of local politicians that Williams has already shown an affinity for.

Second, he has no political opposition.

On that basis, Williams should be able to sail through the next provincial election.

What happens after that, though, is anyone's guess.

Not lovin' Micky D's latest disclosure

As the parent of a child with celiac disease, news that McDonald's restaurants previously failed to disclose the presence of wheat derivatives in the oil used to cook the company french fries has an especially severe implication beyond the obvious one that a company hadn't provided complete product information to consumers.

My daughter's health is involved.

The inaccurate or misleading information provided by McDonald's until now means that my daughter has been unknowingly eating food that may have been causing her health problems. She doesn't eat enough of the fries to give her the severe reaction she had prior to being diagnosed when she was 18 months old. Still, she does eat the fries and any exposure to wheat and its derivatives can trigger a reaction.

"If they're saying there's wheat and dairy derivatives in the oil, as far as anyone with this disease is concerned there's actually wheat in it," said New York resident Jillian Williams, one of more than 2 million Americans with celiac disease, an autoimmune disorder triggered by gluten.

"They should have disclosed that all along," she said. "They should never have been calling them gluten-free."

Ms. Williams is absolutely correct.

To make matters worse, McDonald's Canada hasn't issued a news release - at least on its website - to address this disclosure. Instead, we find out from American sources, linked above, that McDonald's quietly changed the food ingredient labels on its french fries.

You can't even find detailed information on potential food allergens on the Canadian McDonald's site. You will find it on the American site.

As this story spreads, it will be interesting to see if Micky D's winds up with a public relations problem or if the story just slips off the news as quickly as it appeared.

Either way, it's going into my Homer Simpson file as an example of how a company that prides itself on connecting with its consumers, completely missed the boat on this one.

For those in peril

On the night of February 14/15 1982, the semi-submersible drill rig Ocean Ranger sank offshore Newfoundland and Labrador with a loss of 84 crew.

I worked part-time in 1982 paying my way through university. One of my fellow part-timers had a job on the Ranger, working the three-weeks-on/three-weeks-off schedule. As I recall, he as med-evaced with a bad tooth the week before the Ranger sank. His replacement, from the other crew, lost his life.

There are plenty of stories like that, of people being one or two steps removed from someone who died that night. Newfoundland and Labrador is a small place. A tragedy like the Ranger touches just about everyone and even more than two decades later, it is still hard to watch the television reports or listen to the radio clips.

So today, I'll be taking a break from the blog and offering a prayer or two for those who lost their lives 24 years ago.

Eternal Father, strong to save,
Whose arm hath bound the restless wave,
Who biddest the mighty ocean deep
Its own appointed limits keep;
Oh, hear us when we cry to Thee,
For those in peril on the sea.

Cheney jokes

Veep Dick Cheney's skill with a shotgun has spawned some jokes.

1. My favourite one liner so far is the one that hold that it's still safer to go hunting with Dick Cheney than it is to drive with Ted Kennedy. Yeah, I know that one has been around in a dozen versions since the incident hit the news. google "cheney hunting kennedy driving" and see what turns up.

2. For a more sophisticated approach, check nottawa's clever line on Bush and quail/Quayle.

3. The top of all, though, is The Daily Show.

Khaki Tim's in Kandahar

The men and women of Canada's forces overseas apparently are clamouring for a Tim Horton's to be set up where they are.

Like Kandahar, where a large double double means a bus filled with am extra helping of nitrogen fertilizer and some 15 year old doofus anxious to get to Paradise and his virgin quota.

Unfortunately Tim's just isn't overly interested in expanding outside Canada and the United States. [Memo to Tim's headshed: Don't put the newbie out there to freelance your media lines. The kid in the story above obviously has his PR head up his PR arse.]

Well, maybe they are interested, as this story attests.

But hey, this just reminds me of my pet project: a deployable Timmies.

I've been working on the concept for about 10 years. It basically involves a modular concept that will fit on the back of a group of Canadian Forces-style MLVW - basically you can get it in a Herc and you can get it anywhere the CF can go. If you wanna build a free-standing place, then it is adaptable, but either way, the Canadian Forces have to help out with the logistics.

It's doable guys.

You just have to give it a chance.

Recall Harper or RSVP = roflmao

Radio call-in maven Sue has decided that after campaigning vigorously for Stephen Harper she is wrong.

She has started a group to recall the prime minister.

Nice try, Sue, but a recall option doesn't exist in Canadian politics. Even if it did as proposed by the old Reform Party only Harper's own constituents can recall their elected representative.

She calls her new group RSVP, as in Respect the Selections of the Voting Public.

There are a couple of simple observations here:

1. This is an admission Sue was wrong. That isn't news on any level.

2. Sue's mistakes are not cause for a political movement. We've been there, done that and got the t-shirts.

3. Her recall makes no sense because every member of the voting public did get their selection respected. Sue got hers respected in spades. She got the Harper government she worked for, the one she twisted logic and common sense to proselytize for.

Now she can live with her choices.

And her bogus political analysis.

RSVP?

Try roflmao *.
___________________
Update:

What's a political cause without its own website? Not much.

No surprise therefore that RSVP has now got the recall Harper thing set up as a blog of sorts.

You can find it here, but you may also wish to check out the Lower Churchill blog Sue started back in September but apparently hasn't updated much since.

It's attracted a few hits and the title of the first post is Day 1, which presumably was three days ago. Take note of the comments to get a sense of how people are reacting to this effort by someone who only a few short weeks ago was doing her damnedest to get Stephen Harper where he is today.




* roflmao = rolling on the floor, laughing my ass off

Hebron, the premier and getting a deal

While a great many people across the province are cheering on Danny Williams in his latest fight on behalf of this place with someone not from here, it is doubtful the proponents of the Hebron-Ben Nevis development are overly concerned about the premier's latest public claims that any development of the field will have to include a combination of two of the following:

- an oil refinery;
- better royalties for the province; and/or,
- an equity position - read direct involvement by the provincial government - in the field.

Chevron and the other oil companies involved know the premier is fond of making great claims only to accept something remarkably different at the end.

He did it with the federal government over offshore revenues. Williams' starting position was was one thing; he eventually settled for far less than he wanted at the beginning. He also hauled down Canadian flags vowing they wouldn't go up again until a meeting with the prime minister. Then he quickly started talking about putting them back up before that and under other circumstances. When a public opinion poll showed the strength of the public's negative view of his flag stunt, he simply ran the Canadian flags back up the flagpoles at government buildings.

Williams changed positions with Abitibi Consolidated, even going so far as signing a deal that had the province paying the company to keep operating and effectively making no government revenue whatsoever.

The Hebron team also knows that local public reaction never gave the premier a lick of a problem over his shifting pronouncements and positions.

Williams is very good at leaping to the barricades to protect the local Us from the foreign Them. It's an old theme in local politics here, one that stirs the blood of the natives and keeps them distracted from the substance of what's going on. In this instance, Williams is simply making the sort of public statements he likes to make to build up his store of political capital. There is no cost in this to Danny Williams, no cost that is unless he suddenly goes crazy and refuses to sign any deal at all, leaves Hebron in the ground and in the process damages the local offshore supply and service sector.

A man willing to pay a company to take away local resources may be a little crazy from some perspectives. But it is unlikely Danny Williams will go the kind of crazy that would see some political damage being caused over what amounts to the kind of political rhetoric Danny Williams has yet to stand behind. Danny Williams may talk like Brian Peckford, but he doesn't act like him all the time.

As for the specifics of this negotiation, the companies know that two of the premier's three conditions are non-starters. The premier knows it too.

The companies don't want a refinery tacked onto the Hebron project at a sizeable cost to their profits where a refinery isn't necessary to make this project work. The companies know the premier has a private sector group interested in a refinery anyway and that refinery will not depend on Hebron oil for its success.

They also know that deep down, the premier can do the math. Danny Williams understands that a refinery merely delays the point at which Hebron pays off and therefore the province gains higher revenues under the generic royalty regime. Think Terra Nova and White Rose here, not Hibernia.

On the issue of an equity position, the companies simply don't want to have a public sector corporation involved in the day-to-day decisions about running the field. They've told the premier this already. The companies are not anxious to let someone slide into the project who hasn't risked anything or paid a share of the costs to get the project this far.

In any event, an equity position would have to be purchased at fair market value and with the province assuming a share of the costs and liabilities as well as the potential profit. All things considered, the cost to Danny Williams of the equity position would likely outweigh its cash value and certainly would all but neutralise any value in royalties and local benefits. Put another way, the Hebron equity position may well make the Hibernia deal look like a lottery win by comparison. Expect it to disappear from consideration.

Both the provincial government and the oil companies have set April 1 as the deadline for a deal. If one is to be had, expect it to consist of royalties and local jobs benefits. The refinery and the equity position will likely vanish. The reasons are simple: the costs of either of these to the provincial government is simply too great. Shelving the entire project is the only outcome that potentially damages Danny Williams' political position and he has never stuck blindly to a position which ultimately costs him political capital. Danny Williams is more like Brian Tobin than Brian Peckford.

The premier will claim victory no matter what happens. Many will praise his success, as they have in the past and the last of the major offshore discoveries will move into production. No one will notice that yet again what he demanded as his bottom line and what he accepted as his final position are totally different.

No one will notice, that is, except for the companies with which Danny Williams is negotiating on our behalf.

No seat at int'l table: Harper fails on another promise

Provinces will not be getting seats at international tables, as Stephen Harper promised during the recent campaign.

Wow.

That's a surprise.

Stephen Harper promised something and isn't delivering.

Week 2 of Harper-rama looks like it will be as good as Week 1.

Hearn calls for hand-over of Hibernia shares

So it's an old release, but there's no indication Connie fish minister has changed his position on giving the Government of Newfoundland and Labrador the federal government's shares in the Hibernia project.

That said, let's see how long it takes Minister Hearn to make the same request of his own government he made of its predecessor: "Hearn said that he would be requesting the Prime Minister and his Government to follow through on this initiative."

The Federal Government Should Give Newfoundland and Labrador its 8.5 Percent Hibernia Share says [sic] Conservatives

MOUNT PEARL, September 21, 2004 --– St. John'’s South-Mount Pearl Member of Parliament, Loyola Hearn, and Conservative Natural Resources critic, John Duncan, say that in light of the Government of Canada'’s decision to sell its shares in Petro Canada, the time is right to transfer the Federal Government'’s 8.5 percent share in Hibernia to Newfoundland and Labrador.

"Despite the fact that Finance Minister Ralph Goodale said that there is no link between Petro Canada and the Hibernia share," said Hearn, "if Canada is willing to unload its Petro Canada shares, then it is logical the Hibernia shares should be transferred to this province. As we look at the history of the development of Hibernia and as we are conscious of this province'’s attempt to benefit more from its resources, it is not only logical but right and proper that the 8.5 percent Hibernia share held by the Federal Government should be transferred for the benefit of our Province."

"This would enhance the Prime Minister'’s commitment to assure that provinces are the prime beneficiary from their resources," added Duncan.

Hearn said that he would be requesting the Prime Minister and his Government to follow through on this initiative.

-30-

Two degrees of separation, Newfoundland and Labrador style

Following is some simple background information on the project announced today involving a new company that will explore the feasibility of establishing a 300, 000 barrel per day oil refinery, likely on the site between the existing Come By Chance refinery and the Whiffen Head transshipment facility. The Vitol-owned refinery is currently up for sale.

1. The project will be undertaken by Newfoundland and Labrador Refining, a new company comprising investors Altius Minerals and three United Kingdom investors, Dermot Desmond, Harry Dobson and Stephen Posford.

2. Altius' proposal to finance the Lower Churchill project was included by the province last year in the short list of proposals on that hydroelectric project. As reported in The Telegram, "Altius proposes creating a royalty trust that would acquire a percentage of the revenue generated from the sales of Lower Churchill electricity."

3. Dobson and Posford are major shareholders in a new oil and gas exploration company, Borders and Southern Petroleum, that is looking for oil and gas offshore the Falklands.

4. Dobson is chairman of Rambler Minerals and Mining, which created out of a company owned by Altius. In the transaction, Altius retained a 30% interest in the company and a seat on the board of directors for Brian Dalton and John Baker of Altius.

5. Last September, Altius acquired shares in Alba Mineral Resources, a company chaired by Desmond.

End fed jobs leaving Ottawa - latest Connie platform dump

Danny Williams and Andy Wells will be upset to discover that the new federal government wants to stop the practice of shipping federal jobs out of Ottawa to other parts of the country.

The tens of thousands of Newfoundlanders and Labradorians who voted Connie because they were upset about "federal presence" must be even angrier over the words of the new treasury board boss:

Treasury Board President John Baird says one of his top priorities is to stop federal government jobs leaking out of the city to other regions.

Mr. Baird told the Citizen this week that he had "huge concerns" about the Liberal practice of relocating jobs to court favour and win votes. He promised, much to the delight of city politicians and union leaders, to try to reverse the trend and preserve jobs in the region.

"We saw during the campaign Liberal candidates promising to take jobs out. We even saw previous ministers giving thumbs up to that concept. That obviously is a significant concern for me and one that as we go through my early days and briefings, will keep eye to," he said.

Expect much skating from Hearn on this one. Ditto for Hearn's new spinner Ryan Cleary who railed against the evil Liberals and who now has to deal with a treasury board president who just nailed his colours to the masthead. Cleary will be doing a non-stop impersonation of Dorothy all the while repeating: "This doesn't look like Kansas, Toto."

Heck, all the Connies in the province will be busily muttering "There's no place like home" as they try and work around yet another gap between what Newfoundlanders and Labradorians were promised in the election and what their new Connie overlords plan on delivering.

(h/t to nottawa. Fed pres always was a complete crock as an issue, but it is so much fun to point out Connie hypocrisy.)

Flash: Ryan Cleary to spin for Loyola Hearn

Wait for the official announcement.

Some people should never come across to the other side of the street.

I guess that's why he mused a few weeks ago about packing up and leaving the province.

Update: As one wag put it, Cleary's been spinning for Hearn for months anyway so the only difference now will be that the taxpayers will be paying Cleary's salary.

Province shut out of second tier Harper cabinet

Hot on the heels of Norm Doyle's ouster as Connie caucus chair comes word that not a single Connie member of parliament from this province was deemed fit to be parliamentary secretary to a cabinet minister.

Take a close look at this list, ladies and gentlemen.

Notice that backbenchers from places like Ontario get to back up powerful ministers from places like Ontario in already powerful portfolios.

The back-stop for the minister of fish, by contrast comes from British Columbia.

But do we get to have the second level nat res spot, since the minister is from BC? After all, natural resources is important to us we develop oil and gas our oil and gas industry?

The parl sec is from Quebec.

Yep.

As we try and move forward with major hydro-electric developments, Steve Harper decided that neither Norm nor Fabe was good enough and it was a better idea to have some guy in there more likely to represent the best interests of Hydro Quebec.

The backstop to the minister responsible for the Atlantic Canada Opportunities Agency?

Some guy from Alberta.

Basically, the parliamentary secretaries list is where Harper rewarded his old buds from the Reform Party.

In the meantime, Fabian and Norm can cool their jets in the cheap seats.

And we can once again ponder why anyone pays any attention to Sue's flatulent political prognostications.

Norm Doyle fired: democracy in action

Norm Doyle, once Connie caucus chair has been punted from his job in favour of one Rahim Jaffer.

Unlike in other caucuses where the chairman is elected, in Connie-land Il Duce makes the call.

(h/t nottawa)

The old school fish minister

Newfoundlanders and Labradorians heard this evening from the new federal fisheries minister, Loyola Hearn, courtesy of two interviews with local television news.

Among the words of wisdom from Hearn:

1. Moving immediately to take custodial management of the nose and tail of the Grand banks means start having meetings with officials.

Newfoundlanders and Labradorians are likely to find out - as predicted - that Hearn will be following the old school of politics from which he comes and which Bill Rowe, Hearn's' radio call-in show buddy, said in Hearn's defence today: it's easy to say things when you are in Opposition.

Put another way, it's about saying one thing to get elected and doing something else once in the job.

2. On the difficult job of managing fish quotas and tackling the overcapacity in the province's fish processing sector: Hearn believes in spreading the resource to benefit the most people, not employing the number of people the resource can actually sustain.

That's the same philosophy Hearn's been supporting since he first got into politics almost 25 years ago.

It's the philosophy that helped get the province's fish sector into the mess it's already in.

Lot's of people who supported Hearn are going to find out what the Bond Papers has been saying all along.

Risk and reward on the east coast oil and gas frontier

Rob Strong, one of the senior figures in the Newfoundland and Labrador oil industry told CBC Radio that the local oil patch is looking forward to increased exploration offshore Newfoundland this year.

As Strong notes, over 20 years have elapsed since the last major discovery in the Newfoundland offshore and for most of the past 15 years, exploration drilling has dropped to near zero.

Technological advances, high demand for oil and gas and the consequent high world prices for oil, coupled with political instability in some regions have led to a renewed interest in the north Atlantic's oil and gas potential.

A record $670 million was bid for Orphan Basinland plots in 2003 and the drilling program this year is further evidence that international capital is willing to look even in frontier regions. The Basin is located about 370 kilometres northeast of St. John's. The basin may hold as much as eight billion barrels of oil.

With increased exploration and development in other deep water fields, the supply of rigs that can work offshore Newfoundland is tight, as a recent public meeting on the province's upcoming energy plan was told. Nonetheless, the Erik Raude, a semi-submersible shown in the picture at right, and the Rowan Gorilla VI, a jack-up, will both be drilling exploration wells this summer.

East coast Canada is very much a frontier region in the oil and gas business, which is code for high cost and high risk. Technically challenging from an engineering perspective, a well offshore may cost as much as $100 million to drill. Improvements in seismic technology has reduced the risk of producing a duster - a dry well - but the risk remains.

The region also brings with it a political and regulatory issues that add further costs. One recent comparison showed that it may take twice as long for a proponent to get production approval offshore Newfoundland or Nova Scotia as it would in the North Sea or the Gulf of Mexico.

The regulatory issues are not insurmountable. Both the Government of Canada and the Government of Newfoundland and Labrador have expressed an interest in streamlining the regulatory requirements for exploration and have taken preliminary steps to do just that. The Atlantic Canada oil and gas industry has also pressed for regulatory reform that balances the need for environmental and safety protection with the need to drill wells and bring new oil and gas fields into production.

Politically, the oil and gas industry remains a potent symbol of riches, especially in Newfoundland and Labrador, and that is reflected in the premier's rhetoric about jobs, cash and getting a bigger stake for the government in the offshore. That will be the harder hurdle to climb if the Newfoundland and Labrador offshore is to become truly globally competitive.

The provincial government and the consortium behind the Hebron/Ben Nevis development, for example, are currently negotiating local benefits and royalties but there is no guarantee the project will proceed. Premier Danny William has publicly talked of front-loading the project with added costs like construction of a local oil refinery and letting the province's hydro-electric generating company buy an equity stake in the project. As Williams told Canadian Press late last year:

The premier said as owner of the resource, Newfoundland and Labrador is seeking a financial stake in the project unless the companies agree to build a refinery in the province or hand over higher royalties.

"We'd love to take a stake," he said. "By getting a piece of the action, not only do we get a return and some of the profits from the dividends, but at the end of the day we will have assets that are worthwhile."

Both the Hebron consortium and Williams have set April 1, 2006 as the deadline for achieving an agreement on Hebron. That's slightly less than a year after the consortium reached an operating agreement among themselves for the project. Whether or not an agreement is reached with the provincial government may depend in large measure on where the economic tipping point is for developing an oil field in the already high cost offshore frontier.

Williams' other dream, of having a provincial Crown corporation operating in the offshore may depend, ultimately on the province's willingness to undertake the risks private sector companies have been taking for the past 40 years. Talks to gain an equity position on existing projects are rumoured to have run into flat-out opposition and repeated efforts to acquire the federal governments shares in the Hibernia project have similarly met with no support from either the federal Liberals or the Harper Conservatives.

Ultimately, in order to get a direct stake in developing the offshore beyond the government's political and regulatory control, Williams may have to invest in exploration licenses and doing all the grunt work of finding oil and gas in the north Atlantic. That's the tough and costly way, but there may well be no realistic alternative.

With frontier oil and gas, those who take the risks reap the rewards.

Who ya gonna listen to?

There's an old joke Rodney Dangerfield used to tell about one of his first agents, a stereotypical New York cigar-chomper with a seedy office above a delicatessen.

Rodney went to see him and the guy immediately wanted the upstart comic to change his stage name.

"What's in a name?" quipped Dangerfield. "As Shakespeare said, a rose by any other name would smell as sweet."

"Who ya gonna listen to," grunted the agent, from behind a haze of cigar smoke. "Me or your friends?"

Well, there are likely a few people wondering who they should be listening to if they put any faith in Talk Show maven Sue's political analysis.

All during the campaign, from deep inside the Connie campaign bus, Sue called relentlessly to Bill and Randy and anywhere else that had a radio show with a telephone to explain how a Harper government would mean better representation in Ottawa for the areas outside Ontario and Quebec.

To anyone with a clue, her comments were nonsense from the start. A minority government would want to boost its representation in the places where it didn't have seats. In a majority, everyone gets rewarded with the inevitable result that the bulk of the cabinet spots go to the places where the most seats come from.

Like Ontario and Quebec.

Then came the Harper cabinet.

The big portfolios go to people from Ontario. (Compare that to Paul Martin's cabinet, with its key finance portfolios going to westerners.)

The government departments handing out big bucks for public contracts and capital works go to Quebeckers.

Here's the break-out by the numbers:

Ontario: 8
Quebec: 5
Alberta: 4 (including Harper)
B.C.: 4
Everywhere else: 1 each, except PEI which has no cabinet representation.

Fully 48% of the cabinet is from Ontario and Quebec, the provinces that have traditionally dominated federal cabinets. Ontarians and Quebeckers also get the key money portfolios.

Add all of the western provinces together and you get 37% of cabinet - but you have to add them together.

Atlantic Canada? We get 11% of the seats in cabinet.

So when it comes to astute political analysis, the question for Newfoundlanders and Labradorians is a simple one:

Who ya gonna listen to?

Radio call-in shows of course.

But solely for their entertainment value.

If you want to understand what is going on in the world, you'll have to go somewhere else. "Experts" that call Bill and Randy may have the name, but they don't smell anything near as sweet as the ones who really know what they are talking about.

Equalization changes: Williams and Harper/Sullivan compared

Provincial finance minister Loyola Sullivan is claiming that Stephen Harper's proposals for Equalization reform are perfect for this province but his claim suggests that he and premier Danny Williams are once more at odds over the province's finances.

Their last public conflict came in June 2004 during the offshore discussions when Sullivan backed Stephen Harper in preference to the provincial government's position, represented by Danny Williams. That's the same basic problem again, but it certainly isn't clear that Loyola Sullivan, whose love of digits borders on being a pathological condition, is correct in his math.

Given the importance of these issues to the province and in light of the coming federal-provincial negotiations on federal transfers, a frank assessment of the merits of the province's position will be necessary if the general public are to fully appreciate the issues and the implications.

The following calculations are based on the province's mid-year fiscal statement and the current Equalization fiscal capacity determinations, using 2004/05 as a typical year to demonstrate the impacts of the two proposed approaches to Equalization.

Note: These calculations are approximations based on provincial budget estimates and estimates of per capita fiscal capacity. A more detailed analysis would be needed to produce a definitive comparison.

Danny Williams' position

In his letter to the federal party leaders, Danny William proposed a simple approach to the Equalization formula that would increase provincial transfers from Ottawa and give full effect to the Equalization offsets in both the Atlantic Accord (1985) and the January 2005 offshore deal with Paul Martin.

Under the current Equalization system, Newfoundland and Labrador would cease to qualify for Equalization within the next fiscal year and therefore would be entitled to small, declining offsets. The total value of the 2005 agreement for example would likely never exceed the $2.0 billion advanced already.

In his letter to federal party leaders, Williams proposed that Equalization be based on a formula which includes all provincial sources of revenue in calculating per capita fiscal capacity based on a 10 province standard. As a result, Alberta's economic performance would produce a significant cash result for this province. Williams also proposed that debt servicing costs be considered when calculating entitlements.

The most obvious impact of the Williams approach would be to raise the national per capita fiscal capacity above the one currently resulting from the five province standard. In 2004/05, the national standard per capita capacity would have been approximately $6600 (10 prov.) versus $6200 (five prov.) Newfoundland and Labrador's per capita fiscal capacity was $4900.

This would have provided $878, 900, 000 in Equalization based on a population of 517, 000 people.

Since Newfoundland and Labrador would likely remain an Equalization receiving province over the entire 16 years of the offshore deals, the province would receive Equalization offsets for its oil royalties equal to 100% of those revenues. Oil and gas revenues in that period will exceed all other non-renewable revenues.

This would have produced an Equalization offset of approximately $234, 420, 000 in 2004/05, for a total of $1, 113, 320,000.

That does not include the province's non-renewable resource revenues which the provincial government collects and retains in full.

The Harper/Sullivan Approach

The federal Conservative proposal for Equalization would calculate provincial entitlements on a 10 province standard but without using revenues from non-renewable resources.

The most obvious impact of this approach would be to keep the national per capita fiscal standard at or below the current level established using five provinces. Newfoundland and Labrador's fiscal capacity would be reduced by the amount of natural resource revenues, which for the purpose of this example will be estimated at $248, 845, 000 or $481 per capita.

This produces an Equalization entitlement of $920,777, 000. ¹

Since offshore oil and gas revenues are already offset under this model, no further transfers would flow to the province under either the 1985 or 2005 offshore agreements.

Discussion

1. The major advantage of the Williams approach for the 2004/05 sample year is the impact of the offshore Equalization offset agreements. This produces revenue over and above Equalization entitlements since they compare the province's per capita capacity without offshore royalties to its entitlement under the 10 province standard that includes Alberta's natural resource revenues.

2. It should be noted that in 2004/05, mining revenue was slightly more than $14, 000, 000. Since no one has released provincial revenue figures from Voisey's Bay production there is no way, at this point, of determining the longer term impact of the Harper/Sullivan approach compared to the Williams proposal.

3. That said, as provincial offshore revenues increase, the level of additional offset from the 1985 and 2005 accords increase directly for the full 16 years of the 2005 deal. Unless mining royalties were to exceed the considerable sums coming from offshore oil and gas in the next decade, the 1985 and 2005 agreements should deliver their full potential. This should more than make up for any Equalization declines owing to growth in mining royalties under the Williams proposal.

4. Neither the Williams nor the Harper/Sullivan proposal offsets the impact of a major renewable resource revenue development such as construction of the Lower Churchill.

5. The Williams proposal offers the potential for additional revenue from adjustments related to debt servicing costs that are not contained in the Harper/Sullivan approach. These figures are not included here since they are unknown and cannot be calculated. Williams did not make any suggestions as to what weight he expected to be given to debt servicing costs in making the Equalization calculations.

6. Overall, it is incumbent on Loyola Sullivan to make public his own departments calculations of the financial impacts of both the Williams and the Harper/Sullivan models. Sullivan's public pronouncements to date have been vague, bordering on the vacuous.

His references to an "Atlantic Accord forever" smack of some communications director's idea of clever sound bites rather than a substantive appraisal based on disclosed evidence.

Conclusion

The following conclusions can be made:

- The Williams proposal is consistent with the general approach to Equalization taken across the country to date, in that it is formula driven and uses as many sources of revenue as possible to accurately reflect actual provincial fiscal capacity.

- The Williams approach is supported by most provincial governments and is likely to gain wider support.

- The Harper/Sullivan approach would see at least four provinces facing significant decreases in Equalization entitlements. As a result, this approach would be more difficult to implement. Changes to Equalization would require unanimous agreement of all provinces.

- The Harper/Sullivan approach is designed to reduce federal government transfers to provinces. Irrespective of the rationales offered, the primary goal of the Harper/Sullivan approach is to lower federal government transfers. Before the election, there had been some discussion that the Harper administration would address the supposed vertical fiscal imbalance by reducing federal taxation and thereby allowing the provinces to increase their own direct revenues by raising taxes.

The Harper/Sullivan Equalization changes give the federal government the ability to do exactly that by reducing federal expenditures or at least reducing the rates of increase to allow the program to function on smaller annual expenditures than might otherwise be the case..


----------------------------
Notes:

¹ [6200-(4900-481) X 517, 000]

So lemme get this straight...

In his first cabinet, Stephen Harper appointed a party insider from Quebec as minister of the chief portfolio for pork and sent the guy to the senate so that he can't be questioned in the Commons.

Hmmm.

Given the number of things that Connies said they wouldn't do that they did on Day One in office, can we take any comfort in that little set of circumstances described above?

And in the rest of cabinet:

1. The guy from Newfoundland got fish.

2. All the big economic portfolios went to Ontarians.

3. Social policy portfolios are filled by women, predominantly.

4. The other portfolio with lots of cash - transportation, infrastructure and communities - is sort of a public works 2. That went to a Quebecker as well.

Lemme get this straight: so much has changed under Stephen Harper.

So much for senate reform...

and a bunch of other things.

David Emerson crossed the floor. That's an interesting way for a Stephen Harper to start a new government given the level of criticism the Liberals drew for Belinda Stronach and for the Grewal nonsense. Given that Emerson went straight into cabinet, one must wonder about the circumstances surrounding his decision.

One thing we should be able to count on: no Liberals will be attacking Emerson for being a whore.

As for Michael Fortier, there is no small level of hypocrisy that Harper chose to appoint a party organizer to the senate in order to get him into cabinet. Again, for a party that campaigned on senate reform, the Fortier case is a good indication of how far political expediency may trump campaign promises in the new Harper administration.

As for Newfoundland and Labrador, Loyola Hearn will have to deliver on his party's supposed to commitment to move immediately to take custodial management of the offshore. That's not what we have concluded here was the Conservative commitment but a bunch of people have defended Hearn and company that custodial management is a top priority.

As for cod stocks, let's see if Hearn moves to implement a commercial cod fishery on the northeast coast, as he mused recently, or if he listens to the science and the common sense and shuts down any talk of a directed cod fishery where the stocks simply can't take the pressure.

In the resources portfolio, there's nothing to suggest the east coast will have a better hearing than it has gotten lately but given that the new minister is a British Columbian, there may be some sympathy for offshore issues. My guess is that the Williams administration is talking such a different language on oil and gas development from the national party, there may be some room for friction and a prospect the local industry may continue to take a back seat to Alberta issues.

Williams to Harper: Gimme your lunch money, dork.

VOCM's version of what Danny Williams said in the genuine Great White North isn't what Canadian press is reporting.

VOCM makes it sound like newbie prime minister Steve Harper has some power over provinces that is holding Danny back from turning Newfoundland and Labrador into some sort of "Lucky Charms"fake-Irish tabby with a 'tude.

After all, we are just magically delicious out here in the mysterious Far East.

Maybe Danny wants to give new meaning to the word "sham-Rock".

Turns out it is just Steve's cash Danny craves.

"The smart approach would be to allow the jurisdiction of the provinces and the territories to have the resources, to have the funds, to have the revenues that they need to plow back into their areas just for development," he said.

And some people thought I was wrong when I said the Prems just wanted Steve to hand over his cash, mucho pronto.

or wrong when I said there was a major Equalization battle coming between Ottawa and the provinces.

Hmmm.

Guess it is time to explain just where PM Steve and Premier Danny disagree.

30 million and two reasons to miss Brian Tobin

Courtesy of Craig Westcott and The Express comes another reason to miss Brian Tobin: his hand in shagging up the provincial fishery, as noted in a recent report compiled for the provincial fisheries department by former Liberal member of parliament and fisheries union president Richard Cashin.

Management of Processing Capacity

When the Fishing Industry Renewal Board submitted a report in 1996 on management of the fish processing sector, one of the issues was the demand for new crab licenses. The report cautioned against a wholesale increase in crab processing capacity. Instead, it recommended consideration for new licenses be given only to three major fishing centers (Twillingate, La Scie and St. Anthony) that then did not have crab licenses. There is no doubt in my mind that the Wells government, which commissioned that report, intended to implement it generally as it was presented.

Unfortunately, Premier Wells stepped down. It is ironic that his successor, Premier Tobin, proceeded in 1996 and 1997 to do the exact opposite of what he had done as Minister of Fisheries and Oceans in 1993 and 1994. Then he had been the recipient of the Atlantic Task Force on Incomes and Adjustments in the Fishery. He also was mainly responsible for getting billions of adjustment dollars spent to deal with aftermath of the cod fishery closures in Atlantic Canada, mostly in Newfoundland and Labrador. The primary problem in the industry then had been the considerable redundant capacity created by these closures. Problems in the ranks of harvesters and plant employees were addressed in part. The newly redundant capacity in the processing sector was not. In 1996-97, that provincial government, with the full knowledge of the mess we had been in only four or five years earlier issued 17 new crab licenses. Three more licenses were issued from 1998-2000 and another six would be added in 2001. [Emphasis added]

This undisciplined response to the increases in the crab and shrimp resource and harvesting licenses of the mid to late 1990s contributed to the build-up in crab (and shrimp) processing capacity and in a significant way to the crisis we have today. The additional processing licenses were issued for both species with complete disregard for such basic factors as total resource requirements versus availability, economics of location and the general viability of processing operations. This was a singularly unprecedented ignoring of the processing over-capacity problems that still lingered in the industry from the groundfish collapses of the early 1990s. Indeed, some of the crab licenses issued never operated; resource availability was already inadequate even before the declines of this decade began. The main results of that abdication of responsible public policy included the maintenance of some operations that would, and should, have left the industry, the establishment of other facilities in uneconomic locations and even the entry into the crab processing sector of new operators. The overcapacity created by these licensing actions drove the various industry-led attempts to find rationalization measures and plans for the crab and shrimp sectors over the last six years or so; these usually featured RMS as the preferred solution of processors. [Report of the Chairman, Raw Materials Sharing Review Committee, December 2005, pp. 48-49]

Sadly, the Westcott piece isn't on The H'Express website. Cashin gave Westcott some even juicier quotes, which I have been forced to retype below.

As Cashin notes, this unwarranted increase in processing capacity would have been bad enough but given that Tobin had previously been federal fisheries minister and was well aware of problems in the fishery, his actions are almost unfathomable.

"It's really appalling, but it's really indicative that Brian Tobin was not really engaged in being premier," said Cashin.

"He was really engaged in some sort of masochistic exercise which he misguidedly believed would lead him to the prime ministership of Canada."

...

From 1993 to 2000, Cashin served on a federal panel that brought him into contact with most Liberal MPs from Atlantic Canada.

"As best as I could figure it from talking to them, there was a strong mood that if Tobin's name came forward, there was a maximum of one MP who would support him," Cashin recalled.

Anyone who wants to know why Tobin dropped out last time and didn't take a run at it this time can have a look at that last bit from Richard Cashin.

Westcott contacted Tobin on the matter. Tobin - not surprisingly - begged off comment claiming he had other things on his mind. He referred Westcott to John Efford, who was fish minister at the time. Brian never did like to take responsibility for stinky issues. He always liked to slough those off on his ministers.

Gee.

There's yet another reason to miss Brian Tobin: his willingness as first minister to take responsibility for things that happened while he was in charge. At right, Brian Tobin points the finger at someone else. [Photo: Greg Locke]

Of matching and magic

The lack of candidates for the provincial Liberal leadership is now a subject for some media attention, as witnessed by David Cochrane's report on CBC television on Thursday.

Former leader Roger Grimes offered the view the number of candidates may have more to do with individual circumstances rather than a problem among provincial Liberals.

He may be right in some instances.

In other cases, such as Paul Antle or Siobhan Coady, one can easily conclude from their own comments that their interest was more with federal politics and provincial politics, so it makes sense that they'd prefer to turn back to their own businesses than challenge a relative unknown to lead provincial Liberals.

Still others were likely off-put by the daunting challenge handed to the prospective leader by the Liberal Party leadership. The effect of having the leadership convention - if it occurs - a full year after Roger Grimes stepped down is to give the new leader the task of finding 48 candidates, rehabilitating the party organization and banking the better part of $2.0 million and then fighting an election against an organized, wealthy, popular incumbent political party all within the space of a year or less.

The party executive seems to have assumed the leadership would attract great interest, that the convention would generate huge popular interest and that this interest would be the "bump" to carry the party through the election. This would be known as the "and then magic happens" strategy, which is fine, except that magic only happens in fairy tales.

Part of the reason for the attention to the lack of candidates comes from the assumption that the leadership would be heavily contested or even that there would be more than one person to come forward. While that has occurred in the past, it has been infrequent and there wasn't a guarantee it would happen this time.

What has occurred though is that the one candidate to come forward - Jim Bennett - actually matches with outlook of the caucus and likely much of the party executive. In such a homogeneous world as the one currently inhabited by the Liberal caucus, there really isn't a need for several leaders to come forward all of whom basically represent the same point of view.

There certainly isn't anything to attract someone with genuinely new ideas who would face the challenge of not only getting ready for an electiion but of facing a caucus that opposes most if not all of the new leader's agenda.

Bennett is a proponent of the Ruralist school. He champions the salvation of rural areas of our province through some, unspecified means. His first, and so far only, public policy statement is to call for the nationalization of Fishery Products International (FPI), in whole or in part. That's an old idea to be sure and one which has never worked either here or in the former Soviet Bloc.

Of course, the real reason for government buying FPI is to avoid changing the fishery. The only likely outcome of government buying FPI is that government would pour tens of millions of dollars into the company and keep people working at jobs that are not economically sustainable. However, to Ruralists, economics are meaningless in pursuit of the goal of preserving our unique "rural" way of life at any and all costs.

Bennett fits with the dominant view from the current Liberal caucus. This is the same caucus that while in government supported having Sue Kelland Dyer as a senior policy analyst to champion every nationalist cause imaginable, the same caucus that paid millions to have Vic Young chronicle yet again historic local grievances against "Canada".

This is the same caucus, through interim leader Gerry Reid, that saw the recent federal election results as proof that the wealthy parts of the province (i.e. the Avalon peninsula) voted Conservative while "rural" areas voted Liberal.

This neat little division of our province in "rural" and "urban" areas misses much. Fundamentally, however, it prevents the Liberal Party from developing any policy that would appeal to the province as a whole. It certainly writes off the bulk of the population, which lives on the Avalon peninsula and more specifically in the northeast Avalon in and around St. John's. With it, the party effective is writing off its chances of winning a majority of seats in the next election.

Taken in that light, no one should be surprised that only Jim Bennett has come forward to seek job of being leader of the Liberal Party. He is a perfect match with the caucus and, by extension, with the wider party headshed. Other possible candidates with the same or a similar outlook are otherwise occupied with their lives, much as Roger Grimes noted. Within caucus, there is also no need for any of them to run solely for the sake of running. There is no reason to have a leadership race in which one merely picks from among a group of people who are all just variations on the same theme.

In the meantime, Bennett can carry on as leader with the task of getting ready for the next election, knowing that he speaks to the constituency the party seems to be aiming for.

We will all know soon enough how successful the overall strategy is, how potent the Cult of Ruralism actually is.

And once that test is met perhaps the Liberal Party can come up with a plan that doesn't involve hoping for a leader who graduated from Hogwarts.

The dark side

Newbie members of parliament are busily getting their bearings in Ottawa in anticipation of taking up their new responsibilities within the next week.

Congratulations to them on all getting elected.

But there is a dark side to politics, as Steve Paikin described in his book of the same title.

One of the statistics thrown at the new MPs in their orientation is chilling: fully 70% of them will be divorced or have done serious damage to their relationships by the time their political career ends. The long hours, frequent travel and prolonged absences from home, partners and children take a heavy toll on politicians and their families. For those who take up cabinet responsibilities the stress and pressure is even greater.

Political staff often suffer the same pressures. Divorce is all too common. Young children often miss out on the support of the political staffer parent whose job demands much of his or her time and energy. Scott Feschuk joked about it on his blog during the campaign, but it is all too real a problem. My son was four before I actually got to spend any serious amount of time with him; it's time I'll never get back, but more importantly, our relationship was profoundly affected for a very long time by my lack of involvement with him from the very beginning.

Paikin argues at one point that Canadians should be more forgiving of politicians who take spouses along on business trips, at taxpayers expense. He builds the case by profiling politicians who have suffered relationship problems not by any of their own sins of commission but simply by virtue of the demands we, as constituents, place on our political leaders.

The book is readily available in both hard cover and paperback versions. For those of us whose only political activity is voting, check around for Paikin's book. Read it, and give it some thought.

And for all those newbies in Ottawa these days, it's a book whose message is worth serious contemplation.

You have nothing but our best wishes for success and from those of us who have read the book or who have some direct experience with political life, you can count on our understanding.

Hearn + fish minister = potential problem

If Loyola Hearn gets to be fisheries minister in a Stephen Harper cabinet, there will likely be a problem.

For one thing, if Hearn gives in to his pet belief that northern cod stocks can handle a commercial fishery, as he told CBC recently, then he might run smack into the scientific projections that cod stocks can't handle the fishing done on them now.

That's a problem both for fish stocks and for Hearn's long-term prospects as fisheries minister.

If he rejects the calls for a cod fishery, then he'll raise the political ire of those he has worked to court over the past few years. That's a problem for Hearn, but a win for the fish.

Of course, if the information was placed in front of people who have a direct interest in the fishery - , i.e. the fishermen - odds are good they'd make the right choice.

That's what Hearn is quoted as referring to at the end of the CBC piece. Too bad he didn't make that his only comment, rather than offering the view it was okay to open the fishery.

We are going to be in for an interesting spring if Hearn gets the fish portfolio.

Not one isotopic teaspoon, I say

A newly discovered uranium deposit in Labrador turns out to be larger than initially thought.

I say in all seriousness that government should not let one isotopic teaspoon of the ore outside the province without a ensuring that the uranium is processed to the fullest extent possible locally.

If everyone is upset about lack of secondary processing for iron ore and nickel then they should be furious about uranium leaving the province altogether without being turned into everything from weapons to electricity.

After all, we could build a nice reactor in Labrador, hook it up to the Lower Churchill and develop even more electrical power.

There are 30 million reasons to miss Tobin. What's yours?

Some of us will be mourning Brian Tobin's decision to stay out of politics but not for the reasons his old party pres gave to local CBC Radio this morning as he waxed nostalgic about the glory days of the Second Brian.

Nope.

1. Some of us will be missing Tobin's ability to ramble through a media interview and take every conceivable position on a subject without actually taking one.

2. Some of us will miss his "Conversations with the Premier" on one local radio station. The things were a blatant rip-off of something Joe Smallwood used to do. But as one person said, the guy who stuck the mike in Smallwood's face got the chance to ask questions.

3. Some of us will miss Tobin's petulant - read childishly temperamental - attacks on reporters for asking simple, legitimate questions.

Like his long-talked about call to one reporter in which Tobin, upset that the reporter's story on outmigration didn't match Tobin's optimistic bullshit, commented negatively on the size of said reporter's family jewels.

Reputedly the reporter has the call on tape.

4. Some of us will miss incidents like the one in which the deceptively soft-spoken Ramona Dearing, hosting the CBC Radio Morning Show call-in, stood toe-to-toe with the biggest bullyboy blowhard in town until he backed off.

5. Some of us will miss major items of public policy made up in the back of the car as Tobin was being driven somewhere to deliver a speech.

I used to keep a quote from Tobin on my wall. It said something like "Public policy is not made at the drop of a hat; it comes after careful deliberation." He said that in the House of Assembly right after announcing a policy he had just that moment pulled from a pronounced bodily orifice.

6. Some of us will miss his fetishistic attachment to the words "quite frankly", "at the end of the day" and "in the fullness of time". They are hollow, empty, meaningless, space-fillers.

7. Some of us will miss the $57 million bucks in public money Tobin arranged to get from his buddy, hydro board chairman Dean MacDonald, to run something called the Lower Churchill project office. The money was never properly accounted for but the stuff that has been publicized showed a pattern of gross waste and no concern for cost. The money was spent at the direction of the Premier's Office and was accounted for neither to the House of Assembly nor, apparently, to the Newfoundland and Labrador Hydro board of directors.

8. Some of us will miss Captain Canada and the Montreal Rally to Save Canada. Hmmm. Something else pulled from an orifice.

9. Some of us will miss the Turbot War, or as it would be more accurately be remembered: the Great Tobin Crusade for International Media Attention for Himself. That had to be the name for it, since the overfishing continues despite all the hype at the time.

10. Some of us will miss Tobin claiming in 1990 that he was Clyde Wells' secret constitutional advisor. Some of us will really remember the high-level phone call in which it was pointed out that either the bullshit stopped or Wells would sort the matter out...publicly.

The bullshit stopped.

11. Well, at least some of the bullshit stopped. Some of us will miss Tobin insisting straight-faced to Doug Letto that he intended to complete his second term, less than 18 months before he bailed out to go to the job everyone knew he wanted - one in Ottawa as a stepping stone to replacing Chretien.

Ah yes.

Many of us will miss the chance to have Brian Tobin back in politics.

We all have different reasons.

What are yours?

Send your Tobin story and we'll post the best.

Hearn off national radar, ditto Newfoundland and Labrador

Loyola Hearn, predicted by some to be John Efford's replacement in Ottawa, is not on Don Martin's list of the top 15 picks for the Harper cabinet.

Martin is the Connie-friendly scribe for the National Lampoon Post, semi-demi-official organ of the Conservative Party of Canada. Our very own right wing Pravda, without the pravda.

For his part, Hearn is the guy who is described by a number of people as being one of the architects of the Conservative Party. Guess that counts for exactly squat in the greater scheme of things.

Martin's story means that either Harper won't be appointing to cabinet anyone east of Quebec other than Pete MacKay, DDS,...

or, most likely our man Loyola will need a super, extra strong voice and maybe a box to hop on when he stands up for Newfoundland and Labrador from his seat well outside the inner circle of cabinet.

He's gonna be so far out of touch with the people making the decisions the only way he'll get noticed is if he sets his arse on fire.

Come to think of it, that's how Efford made the news too:

Self-immolation.

Democracy in action...at nottawa

Head over to Mark's Random Musings and take part in his Great Experiment in E-Democracy.

He's looking for some input on when the national Liberal Party should hold its leadership convention.

Williams' honeymoon over?

The provincial auditor general John Noseworthy released a detailed - and damning - report yesterday into the provincial government's administration of public finances.

Among his findings:

1. A culture of entitlement exists in some parts of the senior public service that allows senior mandarinsto flaunt treasury board guidelines without consequence. Noseworthy pointed to numerous examples of executives receiving salary overpayments with no recovery being sought. The problem is a crhonic one, going back decades...but hey, Danny Williams and his finance minister were elected to implement a New Approach.

2. In December 2003, a Mount Pearl manufacturer received a $300, 000 government loan based on a directive from the premier's office despite advice to the contrary from government officials:

Contrary to the recommendations of officials at the Department of Finance and the Department of Innovation Trade and Rural Development, a directive from the Premier's Office in December 2003 resulted in a manufacturing company being provided with a $300,000 loan in 2004.

Officials cited issues such as:

- the loan would not be secured in that prior liens of other investors would have claim to the company's assets in the event of bankruptcy;

- the investment would not generate additional employment in the Province;

- a revised business strategy of the company was not advanced enough to determine if the company would be viable; and,

- several other existing investors were not prepared to increase their investment.

3. Government contravened the Financial Administration Act and other government policies in the way it provided financial assistance to Icewater Seafoods; and,

4. The provincial government retains a considerable number of surplus properties yet has no strategy for managing or disposing of them thereby increasing government costs.

In media interviews yesterday, Loyola "Rain Man" Sullivan looked extremely uncomfortable. That's likely because Noseworthy's audit revealed significant problems in financial administration that Sullivan can't slough off on the previous crowd.

He and his boss own a bunch of these problems, yet they haven't done anything about them.

Sorta like the debt strategy we are still waiting for.

Two years later.

and they dissed Lono's Code of Conduct

In light of the ongoing fiasco over handing themselves a hefty raise by breaking their own rules, St. John's city council has likely caused a bunch of residents of the capital to ponder their votes in the last election.

They are probably thinking too about the stunning silence of council candidates who paid no attention to Simon Lono's code of conduct. Lono, an at large candidate, unveiled a simple set of principles he said would guide him as a councilor. The candidates who didn't ignore Lono altogether on this point thought the idea was irrelevant since they would always act in an open and transparent manner, putting the public interest ahead of their private interests.

Yeah, well, recent actions demonstrate that council just didn't get it then and they still don't get it. Even the councilors who voted to postpone their pay hikes spoke about the whole matter as a simple misunderstanding.

Tom Hann - who simply echoed sentiments of several councilors including the mayor - said something to the effect that if the whole reason for the hike had been properly explained, residents would have understood.

Barrrrrrmp.

Wrong, Tom.

The point was never about raises.

It was about the sneaky way council set about doing it.

Against council's own rules.

Rules that council was prepared to chuck because they were inconvenient.

Rules that required openness and transparency in the process by sending the matter of council pay to an independent committee.

So, ladies and gentlemen, I give you once again, the Lono Code of Conduct for city councilors in St. John's. Note especially the parts of the code that apply in this case.

Did any member of council come close to adhering to these simple principles?

Code of Conduct
for members of
St. John's City Council

As an elected representative of the people of St. John's, I will:

*• Act in the public interest. I will work diligently for the public interest of the City and not for any private or personal interest, representing the will of residents and treating all persons, claims and transactions in a fair and equitable manner.

* • Behave in an ethical, open and transparent manner. On being elected, I will publicly disclose all my business and personal interests and will abstain from council debates and decisions in which I have a financial interest, organizational responsibility or personal relationship that could present or appear to present a conflict of interest; I will not accept or use gifts, services or opportunities offered to me which could present or appear to present a conflict of interest; I will not use for personal or private purposes City resources that are not available to the general public of St. John's.

* Conduct public business in a civil and respectful manner. I will debate in Council Chambers, and in all public and private forums, in accordance with rules established by Council, Robert's Rules of Order and basic good manners; I will inform myself and focus on the merits of the question under discussion, maintain courtesy and fairness in debate and refrain from defaming, demeaning, interrupting or attacking the character or motives of other members of the City Council, boards, commissions, committees, staff or the public.

* Maintain open communications with citizens of St. John's and staff of the City. I will consult with City residents and businesses on matters of municipal policy, planning and programming; communicate decisions and other information affecting residents and businesses in a timely fashion; and engage City staff to understand their concerns as public employees.

Then there are ducks

Dad is not without some talent, of course.

At left is a 1/35th scale DUKW built and painted by your humble e-scribe. This is a picture from the almost-finished version so it is still missing some little bits and pieces. Nevertheless, you'll get the idea.

DUKW's, known affectionately as ducks, were built on military 2.5 ton truck chassis and designed to ferry men and supplies over the beaches at Normandy. They are fully amphibious, meaning they can go straight from land into the water and vice versa.

At right is a real DUKW lovingly restored and driven through mud, muck and water by its American owner.

Ralph just bided his time

Alberta may well be introducing changes to the province's health care system that include direct billing by doctors to patients for some services.

What a surprise. it's not like Ralph Klein hasn't talked about that before.

Let's see how the new Conservative administration in Ottawa responds, if indeed the changes violate the Canada Health Act.

Charges laid in DND fraud case

Some Connies tossed the case of alleged fraud within the Department of National Defence on the doorstep of the Liberals, largely because they just tossed every one they could into the pile of alleged "corruption" and miscellaneous evil and kitten eating.

Well, read the story by Canadian Press.

There was criminal activity. The police were called. People were charged. Those who blamed "Liberals" for this were, as usual, grossly deficient in their facts.

Then again, some people can never be accused of letting facts get in the way of a smear.

The battle lines might be forming

over the so-called vertical fiscal imbalance and Equalization reform.

Check the Globe and Mail on Tuesday, specifically the story on the Harper budget due for March.

It includes this section at the end:

Experts warn that the new Tory regime will be hard-pressed to pay for a controversial election promise to share Ottawa's surplus riches with the provinces. Last December Mr. Harper pledged to fix the so-called fiscal imbalance between Ottawa and the provinces.

"I think we have to face the fact that Ottawa is rolling in tens of billions of dollars in surpluses . . . at the same time as provinces and municipalities are having trouble meeting the essential core services without going into debt," he said then. "We must find a long-term revenue transfer from the federal government to the provinces and municipalities."

But economists warn that the Conservative fiscal plan provides scant resources for assistance to the provinces. The Tories did not budget any cash for fixing the imbalance, but said they will fund it from $22-billion in budget surpluses their plan would generate over five years.

Dale Orr, chief economist at Global Insight (Canada), said the Tories won't have much cash to spare, especially if they set aside some of each year's projected surplus to guard against economic downturns. He said what's left is small potatoes. "That's not very interesting to the premiers . . . They are talking big, big bucks."

Quebec not interested in elected senate

Since Steve Harper has only committed to a "national" approach, there's no reason why we couldn't wind up in the bizarre situation where some provinces elect senators and some don't.

In the original announcement, Harper left the impression he'd turn the selection process for senators over to provincial premiers rather than run national elections organized by elections Canada.

Quebec clearly isn't interested.

Now we have to see how serious Harper was about senate reform.

Goose Bay take note: Connie defence promises to be modified

As noted here, the Conservative defence promises contained many elements that could not be delivered, at least in the near term.

Canadian Press reported on Monday that the plan will be modified. The $2.0 billion price tag is way too low.

Toronto power needs good sign for Lower Churchill

As much as Danny Williams likes to muse about building the Lower Churchill hydro project on his own, the joint offer from Quebec and Ontario is still the best option available.

A story today in the Toronto Star confirms Ontario is so strapped for power, the provincial government is looking at building a gas-fired power plant in Hog Town to make sure the lights stay on.

The Harper Plan

Courtesy of the Toronto Star comes a speculation piece on Steve Harper's plans for Canada.

Part of the plan is already easy to see: the Conservatives plan to reduce federal involvement in areas of provincial jurisdiction, such as funding programs in health care, social services and education.

That's one of the logical implications of the Equalization reform proposals, for example, which are designed, in part to lower Ottawa's outlays. As some others have suggested, the Conservative starting point in talks with the provinces would be reduced federal taxes that would have the ffect of opening room for the provinces to boost their tax haul.

Expect that one to disappear quickly.

What political leader wants to raise taxes?

Provincial Liberals still hunting for leader

Interim provincial Liberal leader Gerry Reid announced today that he won't be seeking the job permanently.

Former cabinet minister Anna Thistle - admittedly a long shot - also confirmed she won't be running.

The hunt is still on for someone to challenge lawyer Jim Bennett. So far he's the only declared candidate. Bennett enjoys the support of former Smallwood-era cabinet minister Bill Callahan, current caucus chair Percy Barrett and St. John's city councilor Tom Hann.

Bennett, who is married to Ontario cabinet minister Sandra Pupatello, has announced only one initiative thus far: to nationalize Fishery Products International, either in whole or in part.

Others reportedly considering a run for the leadership include Paul Antle and Siobhan Coady.

St. John's council gets religion - sort of

Surprise. Surprise.

St. John's city council voted tonight to send the matter of their raises to an independent committee of some kind for a review and recommendations.

Only Mayor Andy Wells voted against the motion to rescind the pay hikes.

Update: As The Telly reports, councilors were quick to admit they had a problem but their conversion seems reluctant and half-hearted.

As one wag put it it's like council feels that they got caught with their hands in the cookie jar, sister ratted them out and mommy just needs to understand the reasons why they took the cookies in the first.

Andy comfortably predicted the independent consultant who will now review the matter will come back with the same recommendation.

That all depends on who council picks to be the "independent" consultant.

Hands up who thinks it will be Andy's buddy, like say Marie White?

Et maintenant - Stephane Dion

With McKenna out of the way and the second week of leadership speculation calming down somewhat, there is time to look to an obvious choice for leader:

Stephane Dion.

The only issue I'd take with this endorsement from the Draft Dion blog is that Dion would not defend the Trudeau vision of Canada. Rather he'd represent a vision of Canada which a great many Canadians share and which is sadly not being reflected in the current dialogue.

Equalization for beginners

In light of the interest in federal-provincial fiscal relations, here's a link to a post from last year that explained Equalization as simply as I could possibly explain it.

Take a gander.

This will serve as a grounding for the next major post. In that one, I will review the Danny Williams' proposal for Equalization reform and compare it to the one offered up by the federal Conservatives.

Pull the other one, Tom Hann.

It's got bells on it.

Hann, the newbie councilor is actually a political veteran who claims he is new to politics and needs to develop a thicker skin.

Seems Hann is bristling over criticism that he went along with his fellow St. John's city councilors in giving themselves a hefty raise in pay without going through a proper process.

Hann calls the whole affair a "public relations disaster" and that if people understood the reason for the raise, there wouldn't be any controversy. That's one of the things he told CBC radio.

He told The Sunday Telegram he hadn't seen the memo from council staff advising that they needed to send the whole affair to an outside group. Seems Hann is to busy to manage all the paper.

What we have here is not a public relations problem....at least not in the sense that Hann means it.

What the residents of St. John's have here is a council that is incapable of adhering to some basic management principles or its own rules.

Council screwed up.

Badly.

They got caught with their hands in the cookie jar, violating their own resolutions and own by-laws and, if predictions hold, stepping forward at today's meeting to simply change the rules to suit their purposes.

Hann's excuses - "I didn't get the memo" or "if people only understood..." - demonstrate clearly that the political veteran knows full well how to try and bluster his way through a problem of his own creation. The issue never was about the rationale for the raise; it's about the way council handled the whole affair from the beginning. They broke the rules and now simply want to ignore both the criticisms and the rules to keep their ill-gotten gains.

Unfortunately, what Hann learned in his political life is how not to handle a problem.

If Hann understood what public relations really is - and political public relations at that - he'd recognize some pretty simple actions that would make the whole issue disappear in a heartbeat:

Action Number 1: Admit to the mistake.

- That's a mark of integrity and character in a leader.

Action Number 2: Rescind the motion granting the raise and start following the rules.

- Hann and his fellow councilors will likely get a raise, but they'll get it in a way that won't raise the hackles on citizens' necks.

Action Number 3: Stop bullshitting people with cheap excuses.

- Bullshit let's everyone know that you understand the real issues but you are just ducking them. Bullshit also tells residents you have no respect for them and what's worse, that your election platform may have been a snow job.

The thing is, the way Hann is handling this issue, he is damaging the one commodity he can't afford to damage: his credibility. Once that's gone, a politician is in serious trouble.

Hann and his fellow councilors have a public relations problem alright.

The kind of problem a public relations professional could sort out quickly.

But for some inexplicable reason, politicians seem to have difficulty identifying the nature of their problem, let alone sort it out.

The Amazing Shrinking Minority, or The Integrity of Brian Pallister

124 seats.

Lop off one for a speaker.

Now lop off Brian Pallister who is reportedly casting longing glances at the Manitoba Progressive Conservative leadership race:

"...I will be returning to Manitoba and consulting with Manitobans as to whether they wish me to enter the race for the Provincial PC leadership."

This is the same Brian Pallister who on the night of the election denied said provincial political longings:

"I can'’t even begin to consider a provincial option right now," a jubilant Pallister said from his election headquarters in Portage last night. "Tonight I"’m just celebrating 10 years of hard work."

That's 122 and shrinking.

Next!

City ignores own conflict of interest law...and own previous motion

Update: It's Saturday. Grab the Telly for yet more on the slimy operations at City Hall.

on Monday night passed, Council ignored one of its own resolutions - as well as the by-law on conflict of interest described below. That motion, passed in 2002 mandated that council send the issue of salaries to an independent panel before each election and that the incoming council would accept the recommendations.

Despite the fact that all but three of the current councilors voted on that motion, none of them paid any attention to it.

In the meeting on Monday night, city officials reminded council of the need to rescind the 2002 motion. They ignored it and carried on anyway.

Meanwhile, the Telly reports that newbie council Ron Ellsworth (whose election campaign expenses are still larger than his newly inflated salary, but only just) will introduce a motion on Monday...to rescind the 2002 motion, not the one every is complaining about.

unrepentant, the Boor Mayor continues to lash out at all those who oppose him.

Grab the Telly. Vintage small town politics.

Sad but true.

_________________

St. John's City Council is in hot water with residents of the capital.

At Monday night's meeting, without putting it on the agenda, providing any form of advance notice, and without mentioning it in the budget at all, councilors voted themselves a retroactive pay hike that will see some of them getting cheques for thousands of dollars.

According to The Telegram, council made the decision without consulting staff or an outside sources. They merely sat around a table, did some quick math and boosted their pay.

It was a unanimous decision. Some councilors, like Shannie Duff ought to have known better that the process council used was pathetically inappropriate. However, given Duff's long career on council it is possible she was overcome by a moment of group-think.

Newbie councilor Ron Ellsworth offered a lame excuse: apparently he works hard. He may work hard, but the method he chose to reward himself is so ridiculous as to defy explanation.

As for Tom Hann, the whole affair beggars imagination. The guy who has railed against council for its secretiveness and for its alleged massaging of the books at Mile One stadium has now simply become one of the people he used to criticize. How quickly he was absorbed into the collective when Andy, Doc and the boys started talking about paycheques.

The guy who was a fixture of the Open Line shows along with Sue and the Moon man has now been struck mute. His silence is deafening. Should Hann pop up on Monday - after he sees which way the wind is blowing - to rescind the motion and offer apologies, citizens of St. John's should take his conversion with a grain of salt.

Keep an eye on him. The salary issue was too obviously wrong and his willingness to go along with it too easy. Hann was elected having spoken out about the need for financial propriety at City Hall. In this instance, the watchdog helped load the getaway van.

The issue here is solely one of process and the process used is wrong.

The process is wrong because council violated its own by-laws by using the method it did.

By-law 103 on conflict of interest to be specific:

3.(1) No member of Council shall vote on or speak to any matter before the Council or any committee thereof where:

(a) the member of Council has a pecuniary interest directly or indirectly in that matter; (Amended 97/12/01; #1401)

There is no more direct pecuniary interest than a councilor's own remuneration for the job of serving on council.

Conflict of interest is why in every other elected body, the remuneration for elected officials is passed to third parties to decide. Even if council must, by law, vote on its own salary, the salary should be set by someone other than council and adopted without debate.

The question now remains what to do.

Council has no choice but rescind the motion granting the raises. Who better to do it than Doc O'Keefe, the deputy mayor. To do otherwise would merely confirm that council behaves exactly as they have been accused of behaving: without regard to the law.

Once rescinded council should appoint a panel of three persons - none of them being former councilors - and give them 30 days to report on a new method of setting council remuneration from this point forward. Under no circumstances should council grant retroactive pay and under no circumstances should citizens have to deal with this spectacle again in four years' time.

The Blue Plan: rapid execution of deportation orders

Church basements across the country might be filling up quickly if this part of the Harper plan goes into action:

In April 2003, the Auditor General reported that the federal government had lost track of some 36,000 people who were under deportation orders. This is unacceptable. People who are under deportation orders must be removed. Canadians deserve nothing less. [Emphasis added]

The plan

A Conservative government will:

*• Rapidly reduce the backlog of unexecuted deportation orders and swiftly carry out new deportation orders.

There have been cases in Newfoundland and Labrador, which successful Connie candidates laid at the doorstep of Liberals, all the while knowing their party platform contained the above-cited provision.

Now in today's Ottawa Sun comes the case of a family originally from Belgium that is likely to get the swift boot from Canada.

The problem? A 24 year old conviction for breaking and enetering which federal immigration officials have known about all the while renewing the family's papers on a regular basis. The previous conviction only became an issue when the family sought permanent resident status.

From the Sun:

How long it will take the snail-moving bureaucracy to process it, and (it is hoped) give permanent-residency approval, nobody knows. Hillier is hoping the new Harper government will be a blessing. He says he already had support for the Van Hauves from Tory MPs in the area. "All we're asking is a 120-day extension," he says. "What harm is there in that?"

Let's hope that the incoming Conservative government rethinks its policy on deportations, at least just a weensy bit. And that those Connie members of parliament who were willing to support this guy weren't just doing it for the votes.