Playing the numbers

[This is the first of a three part series looking at public opinion polling and provincial government media relations. In the first installment, we'll take a look at the broad issue of news releases output and content. In the second - The media and the message - we'll look at the other media relations activity for the provincial government. In the last installment, we'll pull the whole thing together and take a look at why government does what it does.]

Over the past decade, political watchers in Newfoundland and Labrador have come to accept the idea that the government party will adjust its media activity to coincide with polling periods.

The theory behind it is simple. Since there is only one pollster who collects data at regular, known and predictable periods, a flood of "good news" issued at the right time can reinforce positive feelings toward government or, at least, neutralize or counteract negative feelings.

Marketing researchers will do this routinely. In the wake of a flurry of advertising, they will conduct a short research program to see if the advertising had an impact on a randomly selected sample of the target audience. While marketers may have to establish a baseline - a survey or other research done before the advertising hits - political parties have the advantage of having a rolling baseline of regular polling done either privately for the party itself or publicly.

In Newfoundland and Labrador, only Corporate Research Associates (CRA) conducts quarterly polling. CRA's omnibus poll puts questions to random samples of the provincial population, on behalf of paying clients - including the provincial government - and includes a series of three standard questions on political attitudes.

Lately, CRA has taken to conducting two separate omnibus polls within the span of two to three weeks. The three political questions are CRA's own and are released shortly after the data is collected and analyzed. For them it is a simple marketing device to keep CRA's polling profile high. CRA's news releases are invariably picked up by media outlets in the province and Don Mills, CRA's president is readily available to provide some commentary and analysis.

There's absolutely nothing unusual about CRA's actions: it's just good business. Their questions are standard and, all other things being equal, they should pick up attitudes reliably.

The idea of politicians trying to influence polls got a special highlight during the most recent CRA data collection period (started 12 Aug, for about two weeks). The Liberal opposition issued a news release alleging the Progressive Conservatives were trying to goose the numbers. The Liberals should know since the practice of playing to the polls started under Brian Tobin.

For their part, the Progressive Conservatives dutifully denied any such activity. CBC reported that the Premier's Office stated that "the number of news releases issued recently is consistent with general distribution."

Don Mills defended his research work to CBC:

"It would be, in any case, a very difficult task, because people form impressions over a course or length of time on many issues," Mills said.

"[That's] not to say they couldn't be influenced by a string of good news announcements but, frankly, I doubt it."

Peaks match polling periods 11 out of 12 times

In order to examine the idea of government trying to issue a string of well-timed, "good news" releases, let's first take a look at the volume of releases coming from the provincial government.

If the volume was consistent with general distribution - whatever that is - we'd expect to see a fairly constant number of releases issued. There might be some identifiable peaks and troughs like at budget time, around Christmas and during the summer. Alternatively, we might see some random peaks and troughs driven solely by the operation of government itself. Again, we might see some identifiable peaks at times when there is a lot of news - budget time - or valleys when people are off for Christmas holidays.

CRA polls at predictable times each quarter of the year, usually varying the start and end times of its data collection by a day or two year to year. Government subscribes to CRA's omnibus so it would know well in advance when Don Mills' people will be hitting the phones. Therefore, if we have regular polling and random peaks and troughs of news release volume, we wouldn't expect to see much of a correlation between the polling periods and the news release output.

Figure 1, below, shows the number of news releases issued each week beginning in the fourth quarter of 2003 and continuing to the first part of August 2006 before recent polling started. It includes all types of news releases and media advisories on the provincial government's website.

Fig. 1. Government news releases, total by week
4th quarter 2003 to current. Green lines mark CRA polling periods.

In 11 of the 12 polling periods since the last quarter of 2003, government news release output peaks either immediately before or during the polling. In the one exception, the volume increases steadily during the period and peaks immediately after polling ended.

On the face of it, this suggests that government news releases are not being issued at random. They are not "consistent with general distribution". Rather, there is a fairly obvious connection between output and polling. Even more interesting is the fact that more often than not the peak output is immediately before polling starts.

If someone was trying to influence polling, the best time to peak "good news" would be immediately before data collection started. That way, there is the greatest likelihood that the good news will be fresh in public minds when the telephone calls start.

A little good news

Volume of news releases alone isn't proof of an effort to influence polling results, though. The results we've found so far just give ius a clue something is up that isn't random.

The next task is a content analysis - taking a look at what the releases say. The past three weeks are instructive. For the period 31 July to 06 August, government issued 27 news releases, followed by 34 the next week. During the two weeks when CRA was actively collecting data, government issued 27 releases each week.

August is normally a time when people take vacations. Yet, in the first week of the month, the provincial government announced $1.5 million in funding for the College of the North Atlantic; an expansion of family law services; changes to social assistance funding to give clients more money; almost $75, 00 in funding for the Association for New Canadians; $200,000 for silviculture projects; and, upgrading of a health care clinic in Baie d'Espoir, among other positive initiatives.

In the week immediately before polling started, the provincial government announced progress on funding for the Trans-Labrador highway; $7.0 million for a new school in Torbay; $78, 000 in violence prevention for aboriginal communities; $7500 and a speech from a cabinet to support a conference on rural development; $82 million in federal money for municipalities; $137, 000 for renovations to public housing; and, a $6.3 million sports centre in St. John's.

The provincial government also issued a news release on the proposed dismantling of the Stephenville mill. This story broke in a routine public advisory of projects needing environmental review.

Curiously, the very first release of the following week announced a successful resolution to a problem in Stephenville where used tires have been piling up as part of a problem-plagued provincial government program dating back to the Liberals. Even though government won't know until October if the solution even exists, they issued the release anyway.

Finance minister Loyola Sullivan issued a news release announcing that the provincial government's finances were in even better shape than previously announced. One of the many odd things about this release was that it contained information normally released in November once it had been reviewed by the Auditor General. Sullivan claimed he was announcing the news early, unauditted and to the general public so that government officials could have the latest information in managing their budgets.

The general pattern continued throughout the week, with the first release on Friday announcing $1.45 million for economic development in Stephenville. In the next week, the general trend continued, but this time included $5.5 million in funding for College of the North Atlantic in Goose Bay; increased fees for dentists (framed as improved dental care for children); and, new police officers in the crime intelligence field.

Conclusion

The provincial government news release output coincides with Corporate Research Associates' polling periods too frequently for it to be accidental.

The news release content tends toward "good news" moreso than one would expect to find if release content was random or than one would expect in a period like August when most people tend to be on vacation.

Even when bad news does appear - such as the routine Stephenville environmental notice - it was quickly counteracted with not one but two positive announcements.

There's no question it happens.

In the next installment, we'll look at why.

Conflict of Interest: the Norwegian Model

Revised: 8:15 AM

If Danny Williams checks with the Norwegians on good standards of corporate governance, he will quickly realize just how bad an idea it is for his administration to have established so many conflicts of interest involving the Hydro Corporation, its board chairman, the Premier's Office and one local company.

As announced on Monday, the chairman of the Hydro Corporation now sits on the board of Aurora Energy. Dean MacDonald took the place of Brian Dalton, president of Altius Minerals, a company that is currently looking for an interest in Hydro's Lower Churchill project and which is also undertaking a refinery study as announced by the Premier in February. Altius established Aurora in 2003 and remains its second largest shareholder.

Norsk Hydro's policy makes it clear that such conflicts of interest cannot be tolerated.

6.4 Financial interests in other businesses

As a Hydro employee or Board Member, you should avoid having a personal ownership interest – directly or indirectly – in any other enterprise if it compromises or appears to compromise your loyalty to the Company. Before making an investment in a company that competes with the Company or does business with the Company (such as a supplier), other than acquiring less than one percent (1%) of a listed company, your immediate superior shall be consulted. Special attention should in all circumstances be given to potential conflicts of interest as described in
section 6.1.

6.5 Activities with a competitor, supplier or other business associates

Before engaging in any activity that may be perceived to advance the interests of a competitor or a supplier (or other business associates) at the expense of Hydro’s interests, including serving on the board of such company, you shall consult with your immediate superior.

The bit about consulting with a superior isn't important. In this instance, MacDonald likely accepted the Aurora appointment with the full knowledge and approval of Danny Williams.

The key part is that such a blatant set of conflicts of interest as evidenced by the MacDonald appointment should never have existed in the first place. If it turns out that the Premier did not know about the matter - remember Henley v. Cable Atlantic and Deano's penchant for not telling Danny stuff - then the episode suggests that Dean MacDonald exercised monumental bad judgment.

If Altius is pitching to Hydro as it is, then Dean MacDonald should categorically not be sitting on the board of a company in which Alitus is the second largest shareholder. If Altius is involved in a refinery project which would likely also fall under Hydro to exploit if government joins in, then Dean should absolutely, positively not be involved.

The same goes for Danny Williams involvement in announcing Altius' private-sector venture on the refinery.

Anyway you slice it, this situation causes problems.

It seems Danny Williams doesn't care about conflict of interest unless it involves someone he's ticked off with. Don't forget that he engineered a blatant conflict of interest to exist in his use of the Hydro president as lead negotiator on the Hebron file. Odds are good, he'll think nothing of further connecting Alitus and the provincial government. In his ongoing efforts to get control of the offshore regulatory board, Williams is trying to create the ultimate conflict of interest in the offshore oil governance game.

Danny Williams would do well to consult the Norwegians on good corporate governance. They can teach him a great deal.

The only problem might lie in the fact that implementing their advice would expose Danny Williams to a great deal of criticism for decisions he's already taken.

Two degrees of separation revisited

Revised: 29 Aug 06

A news release late on Monday from Aurora Energy announced the appointment of Angus Bruneau and Dean MacDonald to the company's board of directors.

Dr. Bruneau and Mr. MacDonald are replacing Mr. Brian Dalton and Mr. John Baker who have resigned from the Aurora Board. Mr. Dalton and Mr. Baker, directors of Altius Minerals Corporation, a significant shareholder of Aurora, have expressed the view that the Company [sic] would best be served at this time by their replacement with two fully independent and experienced new directors. The Company [sic] would like to thank Mr. Dalton and Mr. Baker for their valuable contribution in the successful launch of Aurora.

Dalton is president and chief executive officer of Altius Minerals, the second largest share-holder in Aurora. Baker is a director of Altius and a senior partner with White, Ottenheimer and Baker.

Update: Before you go another step take a look at the biogrpahical sketches for Bruneau and MacDonald. Bruneau - who founded Fortis in 1987 and has sat on the Voisey's bay board - fits with Aurora like a glove. MacDonald, whose private sector background is in stuff like cable television, looks like a square peg in the proverbial round hole.

Altius created Aurora Energy in 2003 with Fronteer Development Group to evaluate and explore uranium-rich deposits in central Labrador. Aurora recently completed a successful initial public offering.

In 2005, Altius submitted a proposal to create a royalty trust as a way of financing the Lower Churchill project, currently being pursued by Premier Danny Williams through Newfoundland and Labrador Hydro. MacDonald is the chairman of Hydro's board. According to Altius' website, the royalty trust proposal is still alive.

At the same time, Altius is also pursuing a feasibility study on a second refinery in the Come by Chance area. The study was announced in February by Premier Danny Williams and then-energy minister Ed Byrne. The announcement was highly unusual since government played no role in the entirely private venture.

In early August, Altius announced that Aurora had found significant results in its drilling on the Michelin property in Labrador.

Better late than never

There's something about Danny Williams' trip to Iceland and Norway that doesn't add up.

First, there's the suddenness of it. No one has talked publicly about the need for a fact-finding trip, so one is naturally suspicious of the timing.

Second, it seems passing strange that the provincial government would be heading off to Iceland three years into the mandate to learn lessons from the small fishing nation. Surely someone could have taken a trip a couple of years ago before the situation got as bad as it is today.

Third, the trip to Norway ostensibly to learn about the Norwegian energy industry comes after the provincial government has made changes to organizations like Newfoundland and Labrador Hydro. The time to learn from the Norwegian model was a year or two ago. Instead, Williams has created a situation which is diametrically opposite to Norway's good governance practices. Of course, Williams can still learn something but if he does, it will mean a round of new legislation to undo or dramatically alter many of the changes already made.

Through it all, though one cannot help but notice one specific thing that is extremely odd about the make-up of the delegation from this province:

Missing from the contingent is Kathy Dunderdale, newly installed minister of natural resources.

She's most likely not taking the flights with Williams and deputy premier Tom Rideout because it will fall to Dunderdale to announce that the provincial government is acknowledging the appointment of Max Ruelokke as the chairman and chief executive officer of the Canada-Newfoundland and Labrador Offshore Petroleum Board.

Williams will be wheels-up on Tuesday and Dunderdale can make the announcement - and take the flack - so Ruelokke starts work immediately after Labour Day.

In the meantime, Williams just might be able to learn a few things from the Icelanders and Norwegians. That would mean he will have to dramatically alter his current energy plans and relinquish direct control over organizations like Newfoundland and Labrador Hydro. It would also mean he and Rideout will have to abandon their current approach to fisheries issues. No one should be holding his or her breath on that one, though.

The trip might be a case of better late than never; but since the whole junket is likely nothing more than an excuse for Williams to skedaddle while his energy minister takes the flack over Ruelokke, the odds of Williams altering plans already laid would be pretty long ones.

Morning in America

While political campaigns have always used some form of mass communication, the use of advertising and modern advertising techniques only really took hold after the Second World War. 

The American Museum of the Moving Image has compiled an archive of television commercials from American presidential campaigns beginning with the 1952 Eisenhower-Stephenson contest. 

The Living Room Candidate is a compelling collection of some of the most influential advertising ever created. 

One of the most potent was "Prouder, Stronger, Better", for the Reagan-Bush re-election campaign in 1984. Over 20 years later it remains an emotionally striking 60 seconds of film. You don't need to recall the turmoil of the 1970-80 period when Reagan was first elected. Watch this and you'll be moved. 

You can also find the famous Democratic spot from 1964 featuring a little girl and an atomic explosion and the Republican spot from 2004 featuring a flip-flopping John Kerry.

Prouder, Stronger, Better is more commonly known as "Morning in America", taken from the opening line of the 30 second version. The copy below is taken from youtube.com and while it isn't as good a copy as the one linked above, the effectiveness of the music, voice, images and script are still there. This is the gold standard of political television spots.

 

So what's with that?

So why is it that the former darling of both the Independent and VOCM's radio call-in shows can't seem to get arrested these days.

First, VOCM asked her to abide by the rules and call the shows one a week as opposed to once a day for each of three shows for a while.

The self-styled "hydro-queen" took her teddy and vowed to boycott the entire station for a year. (It lasted a few weeks. She still invades the radio every so often, but these days seems to spend most of her time posting scribbles in varied coloured fonts of ever increasing size over at her rant-fest on the Internet.)

Then, the Independent - suddenly and inexplicably - stopped running her columns. On top of that, the Indy printed a letter by a retired CBC journalist that attacked her pretty savagely. We are talking slagged, big time, with the focus on her lack of credibility.

Now you have to appreciate that "hydro-queen" used to be the darling of the Indy under editor Ryan Cleary. She helped him put together the farcial "balance sheet" on Confederation. "Hydro-queen" even worked on the story that garnered so much of Dan The Man's ire, the one that talked about the Premier's personal charity - but said nothing much at the end of it because the research sucked.

Hmmmmm.

Maybe we can explain the second one. And it isn't because the research suddenly sucked; that's a constant.

Dan The Man gets his knee-britches in a knot and boycotts the Indy over a piece Ryan's fountain of misinformation helped put together. (The boycott is only for Danny and his personal publicist; other ministers still talk to Ryan and the crew.)

But then the researcher gets the flick after Dan's tirade and certainly after the initial complaints about the charity piece.

And then last week, not one but two columns tried to plant the senior editorial lips at the Indy squarely back on Dan The man's hindmost regions. The subject? Why Max Ruelokke of course. What better way to ingratiate oneself with The Man at the moment.

From "The Fighting Newfoundlander":

"Just because it's the law doesn't make it right. Not from where Newfoundland and Labrador stands anyway..."

"That process was followed to the letter - at least according to Halley. Again, that doesn't make the law right..."

"Fight the ruling until either he [Williams] wins, the federal government backs down and allows Andy to serve beside Ruelokke or the law is changed to suit our purposes"

"I'm a fan of Danny boy, in case that wasn't obvious..."

If we didn't know any better, we'd swear the Indy was still getting copy e-mails from the Premier's publicity department; they couldn't have written that any better.

And actually, Ryan the depth of your affection for the prime ministerial posterior is painfully obvious, but the comment didn't fit in the middle of the Ruelokke piece unless someone was really smarting over being rejected by one's fantasy and wanted to suck up...again.

Then there's the entire column by Ivan Morgan on the same subject which is built in some places on pure fabrication. It struggles to kiss both cheeks on pure invention.

But - and this is the big but - they both fall lock-step into line behind Danny Williams.

And the source of all wisdom at the Indy?

She's persona non grata after Dan The Man took exception.

Apparently.

So what's up with that?

Penn & Teller on polling

There is polling and then there is the stuff done by the guy featured in this excerpt from Penn & Teller's cable television show Bullshit!.

Be warned, the language in this piece is strong, but the guy at the focus of this piece is not so much a pollster as a fairly typical political consultant you come across in the United States.

And contrary to what he claims, it is manipulation.

Private Snafu

During the Second World War, both Disney and Warner Brothers produced animated films for public entertainment and training.

In addition to cartoons featuring the Warner Brothers stable of characters like Bugs Bunny and Daffy Duck was a batch of 25 short films centred on a character named Private Snafu. Warner Brothers produced the shorts, but the Snafu character came from the fertile imagination of Theodore Geisel, known to generations of post-war kids as Dr. Seuss. Geisel spent the war working for the Armed Forces Motion Picture Unit under Colonel Frank Capra.

Snafu was a bumbling soldier who taught soldiers the right way of things by being so consistently wrong. He did it with humour and, as with the most famous American propaganda film Why we fight, they were effective. SNAFU is actually a well-known soldiers' acronym for military life. "It is short for "situation normal, all f**ked up." SNAFU is a close kin to FUBAR - "f**ked up beyond all recognition - and TARFU - Things are really f**ked up.


For your enjoyment on a summer Friday is Snafuperman, originally released in 1944:




And Spies, from 1943:

Why so touchy Bill?

Local radio call-show host Bill Rowe seemed unduly sensitive this afternoon as local pundit-of-all-trades Simon Lono pointed out, among other things, that a current down-turn in the local housing market is directly attributable to the Premier's decision on Hebron.

Rowe, who worked for Danny Williams in Ottawa less than a year and a half ago, seemed genuinely uncomfortable with the remarks that obviously challenged the official line coming from the Premier's Office.

"So what's your point?" sneered Rowe is the unwarrantedly condescending way he has of treating some callers. Lono made the point several times. That included walking on Rowe several times as the Premier's former ambassador to OC-Transpo tried to butt in, in order to offer the view that everything was fine and that everyone supported Danny Williams knowing the financial repercussions.

But why was Bill so rattled by Lono? And why did the local callers orchestrated by the Premier's Office go into overdrive today specifically to attack Lono personally?

Well, the answer may lie in innovation minister Trevor Taylor's allusions earlier in the day to wannabe politicians on the airwaves.

Maybe the Danny machine is worried Lono will run in Signal Hill-Quidi Vidi and offer yet another candidate to run against the one Danny is trying to anoint. There's no secret that here at Bond Papers, we'd back the experienced, articulate Lono. His sharp tongue would make short media work of inexperienced, hand-picked candidates or even old hands at the bar for that matter. His frank talk would make a refreshing change from the orchestrated palaver - the word of the week - we get from politicians these days.

Danny-backers might want to be careful what they wish for.

Who loves ya, baby?

Well, at least who seems to be able to call it correctly for you?

While we are a long way from Telly Savalas, seems the shortage of follicles at Bond Papers allows for a clearer vision on some issues.

1. Thought there was something fishy about that guy:

The federal Conservative commitment on fisheries issues like custodial management. Now the whole idea may be a crock, anyway, but the current fish minister in Ottawa campaign long and hard about the whole issue before he went into cabinet.

While only some people were too busy riding the Connie campaign bus to notice Loyola Hearn's hypocrisy, regular readers of the Bond papers were given a simple set of reports - back in January - as Loyola Hearn's party and then Loyola himself abandoned his pre-election posture.

We did it during the election and we reminded you at every juncture since just how much Minister Hearn sounded like his predecessor.

2. Federal presence really means my presence in a federal ministers office.

How times change.

Public servants were griping about cuts to federal jobs in the province.

The Harris Centre at Memorial University issued a "study" on federal presence during the election and promised a second report in February 2006.

Loyola Hearn and Norm Doyle - indeed all the Connies - harped on about how the evil Liberals had taken away the province's fair share of federal and promised to do things differently.

Then the election came and Loyola went to cabinet.

Now, federal public servants are worried about job cuts.

There's no sign of the Harris Centre's second "study".

And Loyola?

Well, he said the day after the election that the whole thing about federal presence was a bit of a crock anyway.

3. Papers, please.

During the election Connie supporters - including the candidates themselves - dismissed comments that drew attention to the plank in their platform about rapid execution of deportation orders.

They chimed in to criticise the evil Liberals about the Portnoys.

Well, the rapid deportation order thing was real.

And, as for Loyola, he is still pussy-footing around, trying to line up a tango with his buddy Norm Doyle so they won't have to be seen to back their party - yet again - and go against what is politically popular in their ridings.

Now let's be clear. The Portnoys should be deported for a whole bunch of good reasons. And let's not forget that if it were not for political interference in the case by politicians from all parties, the poor family wouldn't be holed up in a church basement in Marystown.


So with those three examples under your belt, let's ask the question:

Who loves ya, baby?

Not the guys who constantly jerk you around saying one thing before an election and another thing afterward.

Fisheries Facts still around

The Usual Crowd have been bleating the past few days about a set of facts dealing with foreign overfishing that were on the federal fish department's website.

TUC was bothered because facts were being presented, versus the palaver they usually spread around on radio call-in shows.

Anyway, the piece - Overfishing Myths and Realities - is still on the site. It just got moved to the backgrounder archives.

You can find it by heading to dfo-mpo.gc.ca, clicking through to the English or French version of the site and then looking for "Archives" under the vertical banner on the right hand side that is headed "Find Info On...".

Nice to see the facts stay around and aren't being removed because of agitation by misinformed myth-mongers.

Williams numbers dropping?

All joshing aside, Danny Williams' whining about the upcoming by-election in the St. John's district of Signal Hill-Quidi Vidi is one of those curious little things Dan-The-Man does every once in a while that makes people wonder what he is up to.

A bunch of things make the moaning about a by-election stand out from the usual government publicity palaver.

Of course, everyone knows we are in a polling period and so the publicity machine has been cranking out "good news" at a high speed. Stephenville is to get bags of cash, for example, including the announcement of a tire recycling project that won't even be worth announcing until October. There was a release that announced a bunch of meetings had been held and that the magical, splendiferous intergovernmental fisheries working group task force had reached the conclusion to continue meeting. It took 17 meetings of the main group and various sub-groups to arrive at that conclusion.

But this government this polling period seems a bit more testy than usual about the whole process. There was an extra-heavy round of denials last week when the otherwise lack-lustre Liberal opposition pointed out that the Premier's personal publicity machine was working to put happy faces on everything in sight.

On top of that, there's this complaint that somehow the province's New Democrats are gaining a "competitive advantage" in a seat soon to be vacated by the outgoing New Democrat leader, Jack Harris.

Here's the thing. In every by-election and election Danny Williams has been involved in since he took over the Progressive Conservative party in 2001, Williams has been all over the place meeting, campaigning, chatting, speechifying and doing just about anything he can to win. No stops have been left unpulled.

But that was when everything was on the upswing for Dan-The-Man. He could do no wrong; that job was for the evil Liberals. Now, there have been a string of bads news announcements, the odd out-right failure or two like Hebron. A spending scandal splashed across the news media , its tendrils reaching into the top levels of the Williams cabinet. And most recently, recently, the public has been treated to Williams' relentless pursuit of a pointless legal battle over who will run the offshore regulatory board. It's pointless because the process Williams agreed to - twice - picked someone other than the guy Danny supposedly wants in the job.

For a guy who apparently likes to gives new meaning to the word micromanage, it's easy to micromanage in good times. But when crap piles up - and it is piling up - things start to slip.

Like a by-election.

So while Dan-The-Man has been pre-occupied with every problem anywhere, anytime, he just hasn't been able to get into the by-election game. And since his party can't go to the bathroom without his written approval, the entire process just drags along.

For the first time, Danny just can't fight everyone, everywhere all the time. The Dippers have gotten the drop on him in Signal Hill.

But the intensity of the recent polling activity by government and the sheer lunacy of an incumbent government whining about a little by-election suggest there is just one more little aspect to the whole thing.

Danny knows his polling numbers are dropping.

He loves to poll. In the first months in office, he spent a small fortune on a poll almost every month. During the offshore racket with Ottawa his announcements were driven by polling: pull down the Canadian flags. Check it with a poll. When the poll shows overwhelming opposition, put the flags back up.

Once the Telegram started getting the poll results through the province's access to information, the Premier's personal ones appeared to stop; a good guess would be he started paying them out of some other fund. But poll-freaks are no different than any other addict.

All things considered in Signal Hill-Quidi Vidi, the whining coming from the Danny-boys could just be a sign not only of their frustration and annoyance and, dare we say, impotence. It could also be a sign of a big drop in their own private opinion polling.

Just thinking out loud.

Fisheries facts bust myths

Ignore the bumpf that google might show you.

Clean out your brain if you have been listening to advocates of the damn-fool fishery and other fisheries nonsense on radio call-in shows.

Check out the factual information from the Department of Fisheries and Oceans.

You can even find it at overfishing.gc.ca.

Good stuff.

Factual.

Easy to read and look at.

Correct.

Breaking: Come by Chance sold

Harvest Energy Trust announced today that it has purchased the Come by Chance oil refinery from Vitol for a reported price of CDN$1.6 billion plus additional "working capital and certain other adjustments".

The release is available here from harvestenergy.ca.

Under the deal, harvest will operate the refinery and the retail divisions of North Atlantic Refining, while Vitol will continue to provide feedstock. Vitol's prime book-of-business is purchase and sale of feedstock for refining.

Oil's dark secret

While Danny Williams boasts of battling big oil, he is tackling a small fry, according to The Economist.

The leading business magazine noted in its August 12th issue that of the 20 biggest oil firms in the world, 16 are nationally-owned companies (NOCs). ExxonMobil is the 14th largest company by oil reserves. The top 13 are all NOCs. [Note: the link is to a condensed version of the special feature on state-owned oil enterprises. The full edition is still available in some local bookstores or online at economist.com]

The editorial accompanying the article notes the cost paid for such a concentration of oil wealth and the warning is worth noting in light of plans to turn the province's own electricity company into an oil company or, as the legislation provides, a hydra corporation able to get into any business approved by cabinet.

As The Economist puts it (p.11):

Few of the princes, politicians and strongmen who wield ultimate authority over these firms can resist the urge to meddle. At best, that leads to the sort of inefficiencies found at most state-owned firms: overstaffing, underinvestment and so on. At worst, business of pumping and selling oil is totally subsumed by politics, as in the case of Petroleos de Venezuela, one of the biggest NOCs. In either case, NOCs produce less oil, more expensively, than they should.

The approach being taken by the Williams administration is exactly contrary to the one proposed by The Economist, namely to privatise state-owned oil companies in whole or in part and reap the benefit: "The less bureaucrats interfere, after all, the more money their oil companies will generate for them to spend".

In Norway - Williams' supposed model - Statoil and Norsk Hydro operate essentially as private sector companies with the state owning, respectively 71% and 43% of the company's shares. The companies also do not have any special advantage over private companies when it comes to land sales and government regulation. The three elements - policy and taxation, regulation, and business enterprise - are run separately from one another.

In Newfoundland and Labrador, the effort seems to be to bring all entities under one single umbrella directed from the provincial cabinet room or worse, the Premier's Office. The initiative to turn Hydro into an oil and gas company did not come from its board of directors. The role was imposed on it by politicians. The entire affair proceeds bereft of a strategic plan or a business plan, two of the fundamental elements of sound private-sector business operations.

The relationship between government and its wannabe oil company is also in a fundamental conflict of interest when it comes to taxation. Bond Papers put it this way, in May 2006:

So close is the relationship that Hydro's chief executive officer served as the lead provincial negotiator with the Hebron consortium. The obvious conflict of interest in this situation was ignored by government, but not by the private sector companies in the Hebron group.

The third element to be joined into the morass is regulation. Danny Williams' efforts to appoint his own candidate to head the offshore regulatory board is hardly disguised. Williams' intention appears to be to gain effective control over the board or gain at the board an ally who will follow the general direction set by Williams.

Two of the three conflicts of interest have been realized. The third is being frustrated only by a handful of circumstances that we should hope and pray do not change.

As The Economist notes, the ultimate loser in this venture is the taxpayer. The publicly-owned oil and gas company will be run, as the electricity company is now, by bureaucrats and politicians. Even if, by some miracle, the current crop of politicians, bureaucrats and political-appointees do a half-decent job of running the Hydro corporation - and that would run contrary to experience locally and globally over decades - there is no guarantee the next crowd or the one after will be as good.

Even the current crowd have shown themselves likely to make dubious decisions. They have embarked on a Lower Churchill project without even the most basic business decision-making tools. If trends continue, Williams will commit the province to a project that has the potential to double the size of the provincial government debt.

In the same fashion, the Lower Churchill project office is run just as it has been since it was created when Brian Tobin was premier and Dean MacDonald sat as board chairman, just as he does now. The Hydro board voted the cash, the office reported to the premier and the entire affair was managed out of sight of any public scrutiny.

The Economist article is a timely warning, if one is inclined to heed it. If not, it should give more than a moment's pause. The decisions being taken today will have ramifications for generations to come.

They do not look good.

What do you do...

when you go from being a guy who liked to claim he fought The Man to being The Man himself?

Well, if you are Danny - The Manny - Williams, you bitch about the New Democrats for trying to fix up a selection process so their candidate could win.

Never mind that all Jack Harris and the New Democrats get to figure out here is when Jack will resign. Never mind that Jack already made it plain he will be resigning. Never mind that - contrary to what The Man said, it is routine for political parties to select candidates to run in a pending election even when the incumbent is still in place.

Meanwhile, The Man will decide the date of the by-election.

The Man will spend whatever public cash it takes to get The Man's man elected.

The Man will spend every waking minute knocking every door in the district to win because The Man wants every single seat.

The Man will send every one of his MHAs and cabinet ministers into the district to win.

Having The Man whine about some trying to rig a selection process is like Bill Gates moaning about someone with an abacus trying to muscle in on the high speed computer market.

To be quite frankly honest, the level of whining The Man is doing here is silly.

Quite honestly. Quite frankly. Frankly, Honestly. Quite honestly, frankly...

Suck it up there, Danny.

After all, you are The Man.

Act like it.

Mobile labour force adapts to local downturns

From the Globe and Mail comes an article on Newfoundlanders and Labradorians working in other provinces - like Alberta - and returning home periodically.

The phenomenon of mobile labour is not a new one in the province. It has been happening in various ways for centuries. However, anecdotal reports from some areas of the province suggest that the migrant labour is now coming from communities in which the population was once stable and involves older workers.

The workers include former employees of Abitibi Consolidated's operation in Stephenville. When Abitibi closed their mill last year, the workers have quickly sought work in the forestry and related industries in other parts of Canada.

Other workers have skills needed in the Alberta oil industry. Collapse of talks to develop the Hebron field offshore Newfoundland in April meant that thousands of highly skilled construction workers have had to look outside the province for work. Many had looked forward to Hebron construction ramping up, having finished the Voisey's Bay nickel mine last year.

Newfoundland and Labrador's oil industry is generating considerable cash for the provincial government but production is not labour intensive. Except for a limited level of exploration, the industry appears to be settling into pumping oil from the three fields already in production.

The Hebron failure has also forced the province's local supply and service sector to look overseas for contracts.

-srbp-

Deciphering government spin: Why the Portnoys?

1. We are in a polling period and government wants every boost in popularity it can get.

2. The Portnoy case has lots of support on Open Line, the major source of information for the Premier and the Premier's Office. Put it in the Telly, he might miss it. Crap on him on Open Line and Danny will come out of a cabinet meeting to attack you and he'll do it before you hang up the line.

3. The Portnoys are holed up in a church basement in Marystown, which means they are a big issue in an area where the Premier is especially politically vulnerable: Marystown because of his Hebron failure; Fishery Products International etc.

Add it all together and you get a provincial government intervening in an immigration case that has been hanging around for years and is no more crucial now than it was months or years ago.

But it isn't the provincial government.

Notice the number of times in every single interview that an otherwise perfectly competent minister - John Ottenheimer - mentions that the Premier will be doing this and that the Premier will be throwing his support behind it and that the Premier approved this message.

Sound odd?

It is.

Ottenheimer is just using talking points approved if not written by Danny's personal publicity department.

So we wind up with Ottenheimer saying things likes this to CBC:

"There is a political role I can play — I plan to play that role," said Ottenheimer, adding he has the full support of Premier Danny Williams to assist the Portnoy family, who have been living since last October in a church basement in Marystown.

And those talking points make it clear Danny is to get the credit.

But why only the Portnoys?

There may be other cases which are far more compelling than a couple who entered the country illegally, were deported, came back in illegally and then started having children, one of whom was delivered if not conceived after the family started living in a church basement.

Heck, there are more compelling cases than the Portnoys.

They don't meet the criteria listed above - too bad for them - and that's why Ottenheimer is also quick to add in every interview that he is intervening in this case but not others.

Strong language from judge okay

It depends on whose soul is being saved, obviously.

"Lawyer defends judge"
The Telegram (St. John's)
Thursday, October 14, 1999
Page: 1 / FRONT Section: News
Byline: Bonnie Belec The Telegram

A provincial court judge who was reprimanded by Newfoundland's Judicial Council shouldn't have had to go before the council in the first place, says veteran St. John's lawyer, Danny Williams.

Provincial Court Judge John Rorke appeared before the council in June to answer to a complaint concerning remarks he made during the sentencing of an armed robber last fall.

Newfoundland Supreme Court Justice Robert Wells filed his report recently and stated the council "is unanimously of the opinion that on the day in question Judge Rorke failed to meet the required standard of judicial expression."

Williams and Steve Marshall represented 18-year-old Jeffrey Aylward, who was sentenced to a 12-month conditional sentence for using a bat to rob a pizza from a delivery man. Williams said he was surprised to learn a complaint had been made to the council and that Rorke appeared at an inquiry concerning remarks he made during the sentencing.

"I sat there and I saw nothing way out of line that he did. As an experienced lawyer, I see absolutely no reason why he should have gone before the judicial council," said Williams, who has practiced law for almost 30 years.

He said while the public's view of the court is a concern, the emphasis should be on the person before the (judge), and the rehabilitation of the accused.

"And if he's able to save a soul by having to use words that might be a little bit beneath the dignity of the bench, if he accomplishes that rehabilitation, then I wish there were a lot more judges that would do it," Williams said.

The complaint was lodged with the council by a member of the public as a result of an article published in The Telegram Sept. 11, 1998.

The gist of the complaint was that the judge's remarks would cause public concern as to the fairness and impartiality of the judge and -- by implication -- the fairness and impartiality of the courts, read Wells' decision.

The complaint was spurred by a comment Rorke made to Aylward during his sentencing hearing: "I'm looking at a man who comes from the same strata of society that I do, whose friends come from the same strata of society as I do, and you're not supposed to be sitting there and I'm not supposed to be faced with the dilemma of dealing with a person who comes from an advantaged background."

Rorke continued: "Most of the people who get dragged through this particular courtroom haven't got a pot to piss in. They never had a chance, they never will have a chance, they're damaged goods, and they're acting in the way they are largely because they don't have any choice. The problem we got here, you see, is that this happens all the time. I had a guy here a couple of days ago, it was the second time he did it. I gave him seven years. Sentencing in this is normally three years."

Aylward had been attending a party on Paddy Dobbin Drive when the offence occurred. He and two other young men ordered a pizza but none of them had any money, so they stole it from the delivery man when he arrived, using wooden bats.

At the time of sentencing, Rorke said they did it because they were drunk.

"You say you had a dozen beer ... I've had a dozen beer in me, a good many times. When you got a dozen beer in you, you don't know what you're doing, and it's more good luck than good management if you don't get into a jam, but the fact of the matter is you took it upon yourself to rob a man with a club," Rorke said.

"And when a bunch of young fellas on a drunk in an executive house in a good part of town take it upon themselves to flog one of those people, it's a despicable act," said the judge.

"Now we got a situation here, where a bunch of rich boys did this. You may not think you're rich but I guarantee you compared to most of the guys that come through that door there, you are rich. Not just in money but in family and friends," Rorke said.

"So, the next guy I got to look at and say three years is going to throw back at me, 'Oh yeah, you let the rich boys go because they are your buddies, they are your friends. There's no justice here.' That's the jam you put me in. That's the jam you put the Crown in," he said.

In his 10-page decision, Wells wrote that the words used in the sentencing were "unfortunate and inappropriate and should not have been said."

Inappropriateness occurred at two levels, Wells wrote. "Firstly, a judge should not use unacceptable language in the course of judicial duties. Expressions such as 'haven't got a pot to piss in' are simply unacceptable when coming from a presiding judge, as are personal references such as 'I've had a dozen beer in me, a good many times.'"

Wells stated such language lowers the court in the eyes of the public generally, and by implication damages public perception of the administration of justice.

"We are also of the opinion that references to social classes and strata of society are inappropriate to the sentencing process ... the emphasis must be on law, justice and fairness in each case," read the decision.

During the inquiry, Rorke apologized and acknowledged the public had a right to be concerned about some of his remarks and the way in which he expressed them.

Wells noted Rorke's work in provincial court involves trying to "do justice in the face of hopelessness, belligerence, alcoholism, drug addiction, psychopathy and mental disorder."

Rorke told the council, "under these pressures, I lost my patience and became candid about the frustrations of modern judging. Much of what I said was irrelevant, and easily capable of being misunderstood.

"In approaching the situation as I did, I focused entirely on the dynamic in the courtroom, and overlooked for a moment that my words, intended for the ears of the accused and the lawyers present, were being placed on the public record," he told the inquiry.

"In today's pluralistic society, a judge is expected to strive always to speak only in terms incapable of confusing or offending anyone. On this occasion, I fell below that demanding standard. I have profoundly regretted this inappropriate loss of control since the moment it occurred," he said.

As far as Williams is concerned, Rorke presented an emotional judgement in a particular case to a young man who made a stupid mistake. Williams said if the council decided Rorke chose his words poorly, then in the eyes of council Rorke made a mistake, but in his eyes Rorke handled the case commendably.

"If he's able to get through to a young man and prevent him from being a recidivist, then I think he's accomplished something marvelous. And at the end of the day he had a major impact on that young man," Williams said.

Considering Rorke's 11 years of unblemished service, council concluded a reprimand is the appropriate course of action and no further sanction is necessary. The council also ordered that Rorke be compensated for his legal costs arising from the inquiry, to be taxed on a solicitor-and-client basis.

Bloglett's Familiar Quotations

Government should be accountable to the law, and to the people.

Danny Williams
April 7, 2001

No place for Duplessisme in Newfoundland and Labrador

By arguing against the rule of law, Peter Jackson's column in the Sunday Telegram gives Premier Danny Williams carte blanche to do as he pleases not merely with the offshore board but with anything and anyone else in the province.

Jackson must have hoped that his readers have not read Mr. Justice Halley's recent decision in Ruelokke v. Government of Newfoundland and Labrador and that they are generally ignorant of the issues involved in the offshore board. Certainly Jackson has not read the decision nor does he display much knowledge of the offshore board. (We'll leave aside his apparently naive view of governments and their actions being always in the best interests of the citizenry.)

Even a brief examination of its [the offshore board's] short-lived history unveils a litany of disappointments. The board has failed to show the same kind of vigilance in localizing job opportunities exhibited by its counterparts in the North Sea industry.

In the 20 year history of the Canada-Newfoundland and Labrador Offshore Petroleum Board, it has done exactly what it was intended to do in the Atlantic Accord (1985). That is, the board has regulated the offshore industry.

Jackson does not see fit to provide a litany of of these supposed disappointments. He mentions only one - engineering jobs on the Terra Nova project and recites the story of Andy Wells and the FOGO group. However, when Jackson - and others - talk of benefits they conveniently forget that the negotiation of offshore benefits lies solely where it should: at the feet of politicians. If they have a problem with Terra Nova or any other project then they should be looking to politicians to deal with it. The decision on the engineering jobs was made not by the chairman of the offshore board but by Premier Brian Tobin and his energy minister. Jackson's entire argument on this point is nothing short of a fiction.

In the current matter, Jackson finds Mr. Justice Halley's decision troubling in this respect:

A decision earlier this month by Justice Raymond Halley confirmed Ruelokke's appointment, but it contained highly contemptuous language in describing the province's stand. And by straying off course and attacking Wells' credentials, Halley's decision took on an almost personal tone.

However, Halley did not "stray off course". His comments on Wells' lack of qualification essentiallyally an aside, a comment. The core of Halley's decision focused on the central issue. It details the process involved in Max Ruelokke's appointment and Halley makes his decision based entirely on the facts presented to him.

Halley's characterization of the treatment Ruelokke received, while strong, is entirely justified. Anyone who has read the decision - Jackson evidently not being one of them - could hardly fault Halley for his conclusion or for the powerful words he used to condemn the arbitrary and contradictory nature of the provincial government's position.

As for his concern over Wells' hurt feelings, Jackson would do well to remember that it was not Mr. Justice Halley but rather the three-member arbitration panel which determined Andy Wells was not qualified for the job at hand. They made the decision based on criteria established by the provincial government.

Jackson has built no case here akin to Ghandi's India or the American south in the 1960s. In fact, basis of his argument is nothing more than a recitation of the mythology of the Upper Churchill contract. According to Jackson, Danny Williams would be justified in subverting due process - the rule of law - because of the Upper Churchill demon. (For the record, Jackson misstates the issues involved in the reference and the Supreme Court's decision.) Something drooling under the bed, though, is no justification for the fundamentally undemocratic notion Peter Jackson proposes.

Simply put, Jackson is fundamentally wrong. Politics should never trump the law. The rule of law is the bedrock on which our society - our democracy - is built. Each of us - especially politicians and the government - must be bound by the law. This is the underpinning of Mr. Justice Halley's decision and the Premier would do well to abide the decision as he committed to do.

To do otherwise - to succumb to the facile arguments offered by editor Jackson - would be to return our province to the very darkest of times, when a single politician could rule by decree and few, including the Telegram's editor at the time, would dare challenge his autocratic regime.

Not since Duplessis' Quebec has a newspaper editor written such a spirited endorsement of dictatorship as Peter jackson offers. He should only hope that his morally bankrupt argument does not come back to haunt him and his employer. Jackson should only hope that on Monday morning his boss does not ask him to explain why he shouldn't have won a lawsuit against the provincial government a decade ago when he too found the actions of a provincial government intolerable.

As for the rest of us, we should hope that Jackson's views are not widely held. If they are, then our province is in for a very difficult - and undemocratic - time of things.

For the record, here is Jackson's column in its entirety:

The law is not always right

There are many instances in Newfoundland and Labrador's history where the rule of law has not represented the best interests of the province's citizens. This is particularly true when it comes to federal rulings on matters of provincial concern.

Perhaps the most glaring example of this is the Churchill Falls contract signed by Joey Smallwood in 1969. The benefits have been pouring across the border to Quebec ever since.

In the early 1980s, the province was defending in federal Supreme Court a recently passed water reversion act which, in effect, would have returned water rights and benefits of Churchill Falls to the province.

The province's argument - a convincing one, by any standards - was that the hydro contract violated the basic constitutional right of provinces to maintain control over their own natural resources.

In 1984, the Supreme Court overturned the act. The judges ruled that the province overstepped its jurisdiction because the intent of the act was to nullify an interprovincial contract with a federally registered company.

That this was the intent of the act could hardly be surprising; governments tend to act in the best interests of their constituents. What was surprising, however, was that the Supreme Court concluded a commercial contract took precedence over the fundamental constitutional principle of resource ownership. (I'd be remiss not to point out, yet again, that former Newfoundland premier Clyde Wells was a lawyer arguing against this province in that case.)

People in this province know the Churchill Falls deal is morally and politically repugnant, and many still believe its constitutionality is dubious. But we have had to put up and shut up for almost 40 years because the federal courts insist we must.

There is a similar scent of court-imposed oppression in the current kerfuffle over Max Ruelokke and his supposed iron-clad right to take the helm of the Canada-Newfoundland and Labrador Offshore Petroleum Board (CNLOPB).

I'm sure Ruelokke is an intelligent, honourable man, and his credentials - on the surface, at least - seem to back up his selection by a third-party panel to lead the board.

Crucial role

But the CNLOPB plays a crucial regulatory role in the development of offshore oil, and it is therefore an agency over which the provincial government wants to exert as much influence as possible.

If this sounds like political interference, it's not. The CNLOPB is the very embodiment of the Atlantic Accord, which grants joint management of the offshore resource between the federal and provincial governments. And for too long, it seems to have had very little teeth when it comes to ensuring that the spirit of the Atlantic Accord - according maximum benefits to this province - is upheld.

Even a brief examination of its short-lived history unveils a litany of disappointments. The board has failed to show the same kind of vigilance in localizing job opportunities exhibited by its counterparts in the North Sea industry.

Premier Danny Williams has steadfastly insisted he wants to see St. John's Mayor Andy Wells take the board's top job - or at least share the job by splitting the CEO and chairman positions.

His rationale is obvious. Back in the late 1990s, Wells founded a lobby group called Friends of Gas Offshore (FOGO) which fought the transferring of 250 engineering jobs to England by the Terra Nova developers.

Over the ensuing years, FOGO lobbied to prevent a floating platform design for the White Rose project, even going so far as to launch legal action.

Given the CNLOPB's apparent impotence in defending the province's interests, Williams can hardly be blamed for wanting someone outspoken at the helm rather than another scion of the oil industry. (Ruelokke's only involvement in provincial politics was a stint as deputy minister of energy.)

A decision earlier this month by Justice Raymond Halley confirmed Ruelokke's appointment, but it contained highly contemptuous language in describing the province's stand. And by straying off course and attacking Wells' credentials, Halley's decision took on an almost personal tone.

Nonetheless, the courts - barring an appeal - have had the last word. It appears the Williams government, like many administrations before it, has little choice but to bow before the unbendable will of judicial impulse.

Sometimes, politics should trump the law.

Peter Jackson is The Telegram's features editor. He can be reached by e-mail at pjackson@thetelegram.com.

Charities may be involved in political action

Despite a long-standing rule against involvement in direct or indirect political activity, some charities may be getting into politics and avoiding any sanction from Canada Revenue Agency.

Check this Canadian Press story at canoe.ca.

Pack rats of the world unite!

From the Globe and Mail comes the story of a lifelong pack rat who, after he'd died of old age, left behind stuff stacked all over the house including a comic book collection worth an estimated US$2.5 million.

"Yes!" I shout. Vindicated at last in my hoarding ways.

Then from beyond the door of your humble e-scribbler's pack rat nest comes the voice of She Who Must Be Obeyed:

"Yes, nothing. No one in their right mind will pay 25 cents for that stack of ten year old Telegrams around you, will they. And that collection of every term paper you wrote twenty years ago won't even start a good bonfire."

Suitably brought back to reality, it's time to go lug rocks around the garden.

*Sigh*

Gov't drops gas prices by 9.6 cents per litre

Official reason: market correction due to events in the Middle East.

Real reason: we are in a polling period.

Otherwise, why would the petroleum pricing control nazis have issued an "urgent" and "emergency" notice to drop prices less than 24 hours after saying they didn't have any plans to drop prices?

Of course, gas price "regulation" is a fraud anyway. But as much as "regulation" is a silly thing, government will keep it for just such a polling contingency.

Hydra Corp reinvents Lower Churchill wheel; markets want to talk price

The president and chief executive officer of Newfoundland and Labrador's Crown-owned Hydra corporation is in Toronto continuing work on the proposed Lower Churchill hydro-electric development by doing work that was already included in a proposal Premier Danny Williams rejected earlier this year.

Ed Martin is talking to Ontario officials about technical requirements of transmitting power from the Labrador site through Quebec and into Ontario. Under an application filed in July, Hydra corporation was seeking permission to ship power into Canada's largest province.

Under a proposal submitted by Quebec and Ontario in early 2005, cost of improving the connections between the two provinces would have been paid for by Ontario's Hydro One and Hydro Quebec. Martin's proposal would have the Newfoundland and Labrador Crown corporation pay for the upgrades. A similar requirement to expand the electricity grid in Quebec - also needed to get Lower Churchill power - was included in the Ontario/Quebec proposal but will now be paid for by Newfoundland and Labrador as part of what Danny Williams has termed the "go-it-alone" option.

In an interview with the Toronto Star [linked above] Martin said shipping power to market around Quebec is still under consideration by his company. Such a route would involve submarine cabling across the Strait of Belle Isle and the Gulf of St. Lawrence . The so-called Anglo-Saxon route has een estimated to add at least $1.5 to $2.0 billion to a Lower Churchill development already pegged in the $6.0 to $9.0 billion range. Every previous review of this option concluded that while it is technically feasible, the resulting cost of Lower Churchill power made it unsaleable.

A viable sale agreement for the Lower Churchill's estimated 3, 000 megawatts will be crucial to the project. Ontario energy minister Dwight Duncan told the Star:

"We are very interested in buying from them," Dwight Duncan, Ontario's energy minister, told the Star last week. "But I'm not going to put the ratepayers of Ontario at risk."

He said Newfoundland will have to get transmission guarantees from Quebec to make the deal possible, and ultimately any deal will come down to cost.

"The challenge Ontario has is we simply can't blindly enter into an agreement and pay whatever. You're looking at long-term arrangements that involve price-sensitivity. I don't want my grandchildren to look back in 20 years and say `what were they thinking.'"

In May 2006, Hydra vice-president Gilbert Bennett confirmed that financial issues will one of several major factors in determining whether the project is sanctioned.

Another factor will be competition from other projects already under development in Quebec, Ontario and Manitoba. The Lower Churchill project - about a year behind schedule - would require project sanction in 2009 with first power being generated in 2015. Martin is talking to Ontario officials several months after Hydro Quebec officials started talking potential purchase agreements, according to Globe and Mail's Konrad Yakabuski in a May 2006 column.

Ability to guarantee delivery will also influence any decision to buy power from a Lower Churchill project. As Yakabuski noted, "[t]he buyers will not choose their supplier based on price alone; since the contracts must be signed before the first shovel goes into the ground, the buyers must have the confidence, if not assurance, the seller can deliver the merchandise."

Martin's Hydra corporation has never completed a project as large, costly and complex as the Lower Churchill on its own, raising questions about the company's ability to deliver on time.

Concerns about completion plagued the now-infamous Upper Churchill development. Ultimately, investors' need for completion guarantees coupled with the weak financial position of proponent BRINCO led the Newfoundland and Labrador company to sign a deal that saw Quebec buy virtually all the power from the earlier project at rock-bottom prices for 65 years. In exchange, the Quebec Crown corporation guaranteed investors the project would be completed.

At $9.0 billion, the Lower Churchill project would double the size of Newfoundland and Labrador's provincial debt.

Premier thinks Halley is correct?

For all the puffing, posturing and self-massage, Danny Williams thinks that Mr. Justice William Halley made the correct ruling in Ruelokke v Government of Newfoundland and Labrador.

Or does he he?

In a scrum with CBC Wednesday - and played on CBC radio - Williams was asked about the ruling, his snide comments about the judge and about what he will do next. After saying at several points that he would appeal if there were legal grounds to do so, Williams said this:

"...if I have an opinion that says that in fact Judge Halley'’s judgment is correct, which it probably is, then we'’ll abide by that..."

Of course, that was in the midst of ranting about the decisions such that it is hard to believe the premier won't appeal and appeal again and possibly switch processes, yet again, just as he has done or caused ot be done on three occasions in the Ruelokke affair.

He has twice said he would abide by a decision of two separate processes and he has failed to live up to those commitments. Maybe this one is just smoke too.

Williams might also just drag this out as long as possible and then grudgingly acknowledge Ruelokke's appointment.

We'll know in mid-September.

The spectre of bad faith

There are a great many things troubling about Danny Williams and the Hebron/offshore board file.

As Williams continues to defy the law in his efforts to install St. John's mayor Andy Wells as the head of the board regulating the offshore, one of the most troubling things becomes concern that Williams may have been attempting to rig the entire Hebron negotiating process all along.

Williams accused the oil companies of negotiating in bad faith, back in April when the talks collapsed. He may have been referring to the slip-and-fall lawyer's definition of bad faith, namely an insurance company attempting to deny legitimate benefits detailed in a contract. He didn't state that, however, leaving only the accusation that the oil companies had acted dishonestly or had acted one way while intending to do something else.

But in the realm of contract negotiations, especially commercial contract negotiations, bad faith takes on another meaning, and that is a troubling implication. Article 2.15 of the Principles of International Commercial Contracts states that "[a] party is free to negotiate and is not liable for failure to reach an agreement."

Judge for yourself from Williams' own statements if the Hebron partners would not have been held liable for failing to reach an agreement on his terms, if Williams had his druthers. Judge for yourself - and this is the key implication - what legitimate company would do business with an administration under these circumstances.

We noted back in April the possibility that Williams' efforts to get Andy Wells at the offshore board may have been nothing more than an attempt to unduly stack the negotiating process in his favour.

Since Williams continues with his fight and since he is likely to launch a fight with the offshore board should it approve a recent development application at Hibernia, it is timely to revisit that earlier post, titled "Why Danny wanted Andy...At the offshore board."

The Premier and his supporters will insist that his motives are pure, that he only has the best interests of the province at heart. However, claims of being Robin Hood have long been rejected by courts as a defence for bad faith, for saying one thing and doing another.

In reality, such an argument, already offered up by Williams, is simply a trumped up version of the old argument that ends justifying means. That too has been widely rejected, especially for the when it is little more than an excuse for all manner of abuses of power against individuals and groups.

As often as Danny Williams trots out this defence of his noble intentions, it has surely worn through in the case of Max Ruelokke. Williams has publicly committed twice to abide by the results of a process. In late 2005, he committed to abide the decision of the panel he approved to select a new chairman and chief executive officer for the offshore board.

He did not.

Likewise in July, he committed to abide by a court decision that came about solely because Williams had failed to live up to his earlier commitment to abide by the first process.

He likely will not do so in this case either, claiming as he has that there is a process to be followed and that he is entitled to appeal to the Supreme Court of Canada if need be.

But truth be told even if the case finds itself in front of the learned nine in Ottawa and they too share Mr. Justice Halley's justifiably dim view of Danny Williams' actions respecting Ruelokke, no court can compel the Lieutenant Governor in Council to do anything. Ruelokke's appointment is made by the Council, after all and that is the black letter of the Atlantic Accord (1985).

Williams can simply fail to act for as long as he wants and that, sadly, is the process on which Williams may well ultimately rely. Williams may have mounted flimsy if not laughable arguments by proxy in front of Mr. Justice Halley but he is smart enough to know that ultimately his power on this matter is absolute.

That is a much larger spectre which hangs not merely over Max Ruelokke, but over us all.

Danny's claims don't match the facts, Part 2

The first process to select a chairman and chief executive officer for the offshore regulatory was a group of public servants appointed by the federal and provincial governments, with Robertson Surette's St. John's office co-ordinating a selection process.

They used criteria approved by both governments that, among other things:

- required a single individual for a single position of chairman and CEO;

- included the criterion that the ideal candidate would have "extensive experience in the operational aspects of offshore petroleum activities..."

This process was interrupted at the point where approximately five candidates were selected for detailed interviews. Andy Wells was not on that list and, based on public information, had never previously been considered for the job.

As revealed in July 2005, the first process was interrupted in June 2005 when Danny Williams proposed it be scrapped and that Andy Wells be appointed to the single, combined position.

When Danny Williams claims he supported Andy Wells from the outset and that he was opposed to industry experience from the outset, his claims are directly opposite to the facts.

The second selection process was a committee, provided in the Atlantic Accord that was appointed by both the federal and provincial governments and chaired by well-known businessman Harry Steele. As agreed by both governments, the panel was given the mandate to select a single person.

Danny Williams claimed in an interview on Wednesday that:

When the panel came back and made a recommendation of Mr. Ruelokke, it was assured to me by the panel that there would be in fact be the recommendation, which did occur, that these two roles would be split. So therefore that Mr. Ruelokke could be the CEO and then of course Mr. Wells could step in as chairman of the board. That recommendation was not followed and therefore then I felt you know basically the process through which the panel had made the recommendation was flawed.

This could not have occurred, since the panel made no such decision. The Premier's memory is false or he is deliberately misrepresenting the situation.

As indicated in the statement of fact in the decision on Ruelokke v. Government of Newfoundland and Labrador and consistent with the evidence presented by both parties to the judge, the Steele panel made the appointment of a single individual for chairman and CEO as directed by the terms of reference established by the federal government and the provincial government.

The Premier is simply wrong when he refers to the Steele panel's decision as a "recommendation." Under the Accord provisions, the panel made a decision which was binding on both parties on the issue of who would fill the single job. Anything else it offered was an unsolicited and non-binding comment.

The first indication that the provincial government, i.e. Premier Williams, wanted to split the single job into two was in late December 2005, two weeks after the Steele panel reached its conclusion and fully six months after the Wells nomination had first been proposed.

When the panel offered an additional suggestion on splitting the job in two, it exceeded its mandate under the Accord implementation act and the wording of their comments in that regard are revealing:

During its discussions regarding the operation of the Board and in interviews
with candidates, the Panel concluded that in accordance with current board governance practices, the roles of Chair and Chief Executive Officer should be separated, with the Chair becoming a non-executive, part-time position. While this matter is outside the mandate of the Panel, we recommend that both governments consider taking this action.

Note that the panel clearly understood it was making a suggestion that was outside its mandate and as such it is distinctly different from what the Premier claimed.

Second, the recommendation is that the two orders of government should consider the approach of creating two jobs where one now exists. This suggests it was not a position the panel felt strongly about.

Third, this is a recommendation or suggestion. Under the Accord implementation act, the panel's choice of Ruelokke is binding on government. Williams' argument on this point was summarily dismissed by Mr. Justice Halley.

Fourthly, and most importantly, the Steele panel suggested the chairman position be reduced to a part-time, non-executive position. In other words, the chairman position under such an arrangement would be the lesser of the two positions in terms of influencing the board's overall operations. The reduced role of the part-time job would also be reflected in the salary which, as in the Nova Scotia board would be less than $15, 000 per year.

Again, as in so many instances on so many matters, the Premier's claims are at odds with the facts as already established.

Danny's claims don't match facts

What Danny claimed on Wednesday in an interview with CBC:

I was adamant from the beginning that I would prefer to have somebody as chair of that board, a very, very important position to the province of Newfoundland and Labrador who did not have a background in the oil industry so that there would be no perception of any possible connection to the oil industry under any circumstances.

What Danny actually approved as the qualifications for the Chairman and Chief Executive Officer before he interrupted the first process with the idea of appointing Andy Wells to the job:

Candidates will have an in-depth knowledge of Newfoundland and Labrador’s offshore oil and gas activities, along with a demonstrated ability to manage an organization with diverse technical and regulatory responsibilities, and to work effectively with senior industry and government officials. Qualified individuals will also have a good understanding of the structure and operation of the Canadian and international petroleum industry. Applicants will have extensive experience in the operational aspects of offshore petroleum activities, including full knowledge of related business, financial, safety and environmental matters, and of federal and provincial government legislation and operations. In addition, candidates will have experience in dealing with industry associations and a wide range of non-government organizations. This position requires exceptional communication skills.

Jumping the shark, Danny style

How many times is the word "counterpart" used in this release that otherwise says absolutely nothing newsworthy?

Hint, Billy: It's called a news release because it is supposed to contain important information otherwise known as "news".

It isn't a rock song. There is no bridge.

You don't get points for repetition in the chorus or for changing key halfway through.

Of course, this thing issued from Tom Marshall's office is just part of the pap offensive to make the government look good during polling weeks.

You know polling week. It's like sweeps week on the networks or the PBS pledge drive.

Next week, Joan Burke will be appearing with Andre Rieux live from the soon-to-be demolished Stephenville Mill for a special farewell concert of classical music.

Tom Hedderson is lined up to do a spot on Danny-vision - otherwise known as Rogers - where Danny's brother-in-law has arranged for Tom to host a local version of the Antiques Roadshow featuring only sundials, clocks and other things you can watch.

So panicked is the government to keep its ratings polling numbers from dropping even an inch that even Shawn Skinner emerged from the nether regions of the government members' offices for the first time in months. He called Bill Rowe's Crap Talk to demonstrate more than anything else that Shawn is either full of crap or totally naive and out of the loop.

Never heard of packing bullshit releases when CRA is polling, Shawn? You obviously haven't been getting the memos sent furiously this week by Danny's personal publicist on her Crackberry.

If nothing else works, I am thinking we'll see Danny jump the shark.

Oops.

Too late.

Danny already jumped it. This morning in conversation with Randy Simms. His publicist pushed him on the phone to defend a flatulent release that veteran newsman Simms spotted as nine paragraphs of stale air with the faint smell of methane gas and rotten eggs tossed in for good measure. other reporters had serious things to talk about but Danny's personal popularity takes precedence.

So Danny starts in about how many meetings he has attended. Meetings are hard work, he assured us repeatedly. Blah. Blah. Blah.

Then Danny hit the ramp.

Heading the offshore board is the most important job in Newfoundland and Labrador, sez The Prem and dag-nab-it, Danny will stop at nothing to make sure that Andy Wells gets the most important job in the province.

Unlike the Fonz, at that point Danny dropped of the edge of the ramp into the shark-pool.

The government is so desperate to avoid any drop at all in Danny's approval numbers, it'll be fun watching them squirm.

The only question is how many sharks will Danny try to jump in the next three weeks?

If Danny was Max's lawyer?

What would the Premier be saying if he were a lawyer in private practice, representing a client who is legally entitled to a position but whose entire life is being held up - without a steady paycheque - by a Premier who is fighting tooth and nail to resist abiding by the law he said he would follow not once but twice publicly?

Unconscionable is likely the nicest word Danny would use if the shoe was on the other foot.

Legislature financial scandal bigger than previously revealed

MHAs overspent constituency allowances by more than half million in '05 alone

[Update: See explanatory note at end]

Financial statements released on Monday by the provincial finance department showed that the House of Assembly overspent member's allowances - the subject of a current scandal - by more than $550,000 in Fiscal Year (FY) 2005 even though Budget 2006 released in March, 2006 reported the expenditures were exactly on the budgeted amounts approved by the legislature.

Fiscal Year 2005 ran from 01 April 2005 to 31 March 2006.

Expenditure in FY 2005 for the line item "Allowances and Assistance" under the House of Assembly operations was budgeted at $5, 090, 800 with actual spending reported at the end of the fiscal year (31 Mar 06) as the same number.

Revised figures released Monday by the finance department show the actual expenditure for members' constituency and other allowances was actually $5, 648, 119, a difference of $557,319. (page 41)

Monday's revised financial statement contains a line called "amended estimates" but the figure given under that column - approximately $5.4 million - is not contained in the Budget 2006 estimates. ¹

The "amended" figures have apparently not been released before. Government's website contains only the Budget 2006 documents, including the estimates, as originally released.

The Budget 2006 Estimates figures for the House of Assembly in virtually every line show expenditures matching budget forecasts to the penny, a circumstance that never occurs. The only variation is an additional $375, 000 for unspecified "Professional Services" under revised spending for FY 2005. In the Estimates, "revised" is supposed to mean the year-end actual spending.

In Monday's financial statement, the professional services amount is shown as actually having been about $374, 000 but no indication is given as to what professional services were purchased.

Government likely knew of problems earlier than previously admitted

The unusual way of reporting House of Assembly spending in the 2006 estimates suggests very strongly that the provincial government was aware of financial problems in the House of Assembly for FY 2005 at least as early as March 2006 and possibly weeks or months earlier.

The House of Assembly spending scandal was revealed in June, 2006 with the premier's announcement that Government House Leader and natural resources minister Ed Byrne had resigned as a result of an audit conducted by John Noseworthy, the province's auditor general.

The original news release makes no mention of the date when Noseworthy began working, but in subsequent media interviews Premier Danny Williams appeared surprised that financial problems existed until advised of the allegations against Byrne.

Auditor General's first reports left hundreds of thousands in spending missed or unexplained

Noseworthy's reports on certain suppliers and on two current members (Wally Anderson and Randy Collins) of the legislature show questionable payments totaling $769, 058 for FY 2005. However, Noseworthy reported only $116, 765 in overpayments on members' allowances for that year before announcing his review was completed, the first time. Monday's new financial statements show an additional $440, 554 in constituency allowance spending that was completely unaccounted for or unexplained by Noseworthy's previous work.

In a surprise announcement in late July, government announced that Noseworthy would conduct a new review of some House of Assembly spending, despite his earlier claim that his work was completed. His revised mandate does not include any period after 31 March 2004, however.

Monday's financial statements may be evidence that Noseworthy is getting a second chance to review some spending, but only on year's that do not call into question claims by the premier and others that the House of Assembly financial problems do not extend past the end of FY 2003.

Order-in-Council 2006-295, dated 19 Jul 06, invites the Auditor General John Noseworthy to carry out:

- annual audits of the accounts of the House of Assembly from Fiscal Years 1999/2000 to 2003/2004; and

- a review of constituency allowances between 1989 and 2004 further to the Morgan Commission Report, to determine whether overspending occurred at the constituency level beyond funds which were approved, authorized or provided through the Internal Economy Commission policy.

Budget 2006 estimates also cast increased doubt on repeated claims by the Speaker of the House of Assembly, the Auditor General, the finance minister and the Premier that financial problems in the House of Assembly did not continue past March/April 2004.

___________________________

¹ Explanatory Note: The Public Accounts are the statements of provincial government financial accounts. These account statements are required to be made public under the Financial Administration Act and must be auditted by the Auditor General.

Typically they are compiled after 31 March and tabled in the legislature, as required by the FAA, by the fall of the same year. The publication contains several volumes of figures and explanatory notes. For example, Fiscal Year 2004 ended on 31 March 2005. By Fall 2005, the Public Accounts for FY 2004 were produced and made made public.

The Public Accounts reflect the complete and accurate record of the previous fiscal year based on a detailed review and allocation.

Keeping of the public accounts is vested under the FAA in the Comptroller General.

Estimates are the annual budget estimates compiled by the government and laid before the House of Assembly for approval each year. They contain, among other things, a report of the previous fiscal year's budget and actual performance at the end of the fiscal year.

The column labelled "amended estimates" or "amended in Volume III of the Public Accounts should be the same number contained in the budget and presented as "revised" for the previous fiscal year.

For example, a line item in Budget 2004 Estimates may have ben given as 1,000 to be spent in FY 2004. In the Estimates presented for 2005, the 2004 results would have shown "Budget" as $1, 000 and a figure labelled "Revised" that would be the actual amount spent under that line item.

The "revised" from the Estimates is the spending at the end of the fiscal year as shown by all government financial records including those maintained by the Comptroller General.

The "Amended" figure contained in Volume III of the Public Accounts should be the "revised" figure from the most recent budget. Volume II will provide an accurate figure in addition to this which shows what the final financial position of the province is with respect to that line item. It is the result of a detailed calculation by the Comptroller General as reviewed and approved by the Auditor General.

In the past two budgets, FY 2005 and FY 2006, the line item for House of Assembly allowances and assistance is consistently misreported. However, the figures were known or ought to have been known to the Comptroller General and the finance minister at the time the budget estimates were tabled in the legislature for approval.

In previous fiscal years, the variation between the Estimates and the Public Accounts is comparatively small, including for the allowances and assistance item. In FY 2005 and FY 2006, the results are under reported by $450,000 and $550, 000 respectively and inexplicably.

Both the Estimates and the Public Accounts are compiled by the same officials using the same information databases. Both documents are made public since approval of spending by the Crown is a fundamental way the elected representatives of the people of Newfoundland and Labrador hold government accountable on behalf of electors.

Minor variations occur, however, the misreporting of the accounts and estimates - advertent or inadvertent - for the past two fiscal years is of such a magnitude (10% of the line time total amount) that the discrepancy and the consistency of the misreporting are cause to raise serious questions.

The report released on Monday is described in a way that suggest they are intended to replace Volume II of the Public Accounts. However, Monday's report has not been auditted. Volumes I and II of the Public Accounts will apparently be published at a later date.

House of Assembly overspending known and approved?

Budget documents and reports on the provincial government's public accounts contain glaring discrepancies, a review of financial statements revealed.

Beginning in Fiscal year 2004, members of the House of Assembly had their constituency and similar allowances capped at a total of $5, 090, 800.

However, Volume III of the Public Accounts, an annual compilation by the Comptroller General shows the account was overspent that year by more than $479, 000. (page 43) The next year, the accounts were overspent by over $550, 000 according to a new report introduced by finance minister Loyola Sullivan purportedly to improve budgeting and accountability of government spending.

"This government is committed to accountability and transparency and this is just another mechanism to keep the people of the province in tune with our province's financial picture," Sullivan said in a news release.

Despite the details contained in the Public Accounts, both Budget 2005 and Budget 2006, the estimates - which contain reported actual spending for the previous year - the House of Assembly spending is shown as being exactly on budget.

The Public Accounts are released some time after the budget period, however, the figures should match since the data used comes from the same sets of records in the Department of Finance, including records maintained by the Comptroller General.

The discrepancy is too great for two years in a row to suggest mere coincidence or problems in addition.

Under section 58 of the Financial Administration Act, the Comptroller General is required to maintain the records of the Consolidated Revenue Fund and under s. 29, to ensure no payments are made in excess of appropriations by the House of Assembly. The Comptroller General is also required under that section to report instances of overpayments to the treasury board for action. Treasury board is an executive committee of the cabinet responsible for the financial administration of government.

One of the continuing mysteries of the current scandal is how $3.9 million of public money could be disbursed by the Comptroller General over a five year period without being noticed.

Details contained in the Public Accounts suggest that some individuals were aware of the discrepancies and that the overspending was sanctioned either by treasury board, the House of Assembly's Internal Economy Commission or both. The Internal Economy Commission is the executive committee of the legislature that, like treasury board for government, handles the financial administration of the legislature itself.

The Comptroller General obviously was aware of significant budget overpayments since they are reported faithfully for FY 2004 and FY 2005. The finance minister and president of treasury board would ordinarily also be aware of the overpayments since he or she typically sits on both IEC and treasury board.Itt would beunusuall - especially under the current circumstances - if the finance minister was not briefed on these specific discrepancies.

None of the reviews approved by cabinet will examine the operations of treasury board, the Comptroller General and the Internal Economy Commission to determine what, if anyapprovalss were given during FY 2004 and FY 2005 for overspending.

The Auditor General's previous reports suggest that at least half of the $3.9 million in questionable spending took place after April 2004. Under Order in Council 2006-295, Auditor General John Noseworthy's second review will not examine accounts after March 2004. The order in council directs Noseworthy "to determine whether overspendingoccurredd at the constituency level beyond funds which were approved, authorized or provided for through Internal Economy Commission policy." [emphasis added]

If overspending was approved by IEC , treasury board or both, then the spending is legal unless other criminal acts took place such as fraud or forgery.