$794 million deficit: the ABCs of provincial government budgeting

If crude oil averages US$87 per barrel through the current fiscal year (ending 31 March 2009) and the government performs exactly as budgeted in every other respect too, the provincial government will wind up with a deficit of more than $794 million this year.

That's right.

Almost eight hundred million dollars in the hole.

It's not a state secret.

Your humble e-scribbler did not have to go through any contortions - mental or otherwise - to figure it out.

The figures are there, in black and white, in the provincial government's current budget.  Hidden in plain sight, you might say.

But no, some of you are saying, the provincial government is forecasting a surplus of a half a billion dollars. The media reported it in April and they've kept saying it so it must be true.

Yes, the did and they have.

But that isn't the official budget of the provincial government approved in the House of Assembly any more than all the talk by politicians about surpluses the past few years was accurate either.

That forecast was done separately by the department of finance and repeated by the finance minister countless times.  It is based - evidently - on the hope that oil would actually spend most of the year well north of US$87. They were hoping on oil revenues being almost double the $1.7 billion used to make up the budget. An extra $1.3 billion would wipe out the forecast deficit and leave another $500 million or so besides.

The recent drop in oil prices below US$100 could throw that hope out the window, coming as it does a little less than half way through the fiscal year.  Oil would have to drop quite a bit further than its current price in the mid nineties to wipe the anticipated surplus out entirely, but don't count on there being too much cash left in the till next April.

There are a couple of reasons for that beyond the drop in revenues compared to the Atlantic City dice roll projections. 

For starters, if revenues are already up by about $800 million or so, government might be able to bring in something close to a balanced budget. Any less than that and something's gotta give to stay in the black.

The other thing is that - contrary to the popular view - government hasn't actually produced a real surplus in three years.  Again, eyes are rolling, but all you have to do to see the truth is look at the government's annual financial statements.

Last year, for example, the government spent every nickel it originally budgeted, every penny of the $1.5 billion surplus and on top of that had to borrow another $88 million just to make ends meet.

Just to make it really plain, that table above is  taken from a Bond Papers post last June that lays the whole thing out in a picture.

This administration, like pretty well all the ones before, likes to spend public cash.  If there isn't enough coming in, hitting up the banks is just as good as money earned in other ways.

As the Auditor General pointed out in his report earlier this year, the provincial government has consistently boosted public spending based on the mountains of oil cash flowing.

They've  built the province's spending on some pretty shaky ground, namely highly volatile commodity prices.

At the same time, very little attention has been paid to paying down the large amount of debt - the accumulated deficits - that now runs upwards of $8.5 billion and is expected to climb higher this year.

That's the table at right, with the figures taken from the finance department's budget document, The Estimates.

For those of you whose mind has not just boggled into the "off" position, this has some pretty significant implications for what is going on in the province.

The province's finance minister told reporters today that salary expectations from groups like the nurses are based on high oil prices.

No, they aren't. 

High public expectations for new spending and public sector union salary demands are based on the government hype about its own financial plans and its own cash flows.  The people of the province believed all the stuff about surpluses and happy days finally being here. They believed because that is what they were told by politicians.

People have even been lulled into believing that the Hebron project - all $28 supposed billion of it  - is coming right along any day now. 

The reality is starkly different.

Oil revenues will decline over the next decade because of dwindling production and prices that are returning to something approaching the norm.  The three existing fields will be well on the way to shutting down by the time Hebron gets into production.

Rather than adding to current cash flows - as most people likely believe - Hebron will simply take up some of the slack from that dwindling production.  If construction starts on Hebron in 2012, the cash from its oil won't hit provincial coffers until about a decade from now.

The reality is that the next decade is going to be considerably more difficult than people imagined;  difficult that is for the provincial government.  They have made a rod to beat their own backs by creating a climate of expectations that simply can't be met with likely revenues.  At the same time - through the energy corporation and the equity stakes - they've committed to a steady stream of new government borrowing over and above what it may cost to sustain the existing spending levels after the oil money drops off.

There's nothing overly complicated about the whole business.  The information is readily available to anyone who cares to look.

Understanding what is going on today and what looks very likely to happen?

Well, that's as easy as A-B-C.

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Goose to get Hornets?

Goose Bay might soon be home to an unspecified number of CF-18 Hornets, according to David Pugliese.

Lots of anger there as you can see, although I don’t know how shocked they could be since I’ve reporting since April 2007 that the recommendation from CANSOFCOM is that JTF2 should move to Trenton.

So will anything ever be done about Goose Bay? I’m told a plan might be in the works to station a small number of CF-18s at the base for Northern sovereignty patrols. That would have a double impact in the sense it would show the Conservative government is acting on its commitments to defend Arctic sovereignty while at the same time doing something for Goose Bay.

It probably doesn’t make military sense but it would indeed be “win win” for the Conservatives and get people off the government’s back on the Goose Bay issue. No word, however, on when this might happen and whether it will even get beyond the planning stages (who knows what the bean counters are going to say on the cost of this proposal).

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The CBC makeover

First Denise Donlon.

Second, Mansbridge is sidelined in favour of J.D Roberts.

What's that?

Never heard of J.D. Roberts?

That's because he went south of the border, lost the mullet and had a total makeover.

Now they call him John Roberts.

And since Mercer and Murphy are getting kinda stale, Denise can vastly improve the national news. Citytv is about to drop its highly opinionated sock.

He'd likely sign on to a new gig in exchange for a regular tumble in the dryer. 

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Sure ABC isn't partisan

A faithful pitcher plant called one of the radio call in shows today continuing the My ABC claim. 

That is, the whole Danny Williams ABC Family Feud is not partisan and not all about Danny Williams.  It's a movement for the people by the people.

There you have it.

But if that's the case and ABC is not a partisan thing, then someone needs to explain why the registered agent for the "campaign" is the president of the Provincial Conservative party and the address listed for it with Elections Canada is the address for the Provincial Conservative party's treasurer and the domain is registered by the Provincial Conservative party with the party's executive director listed as the contact?

Truth is, ABC isn't run by nor is it about the Government of Newfoundland and Labrador.

Heck, truth is it can't even claim to be speaking on behalf of the people of Newfoundland and Labrador.

Truth is ABC isn't anything but (Provincial) Conservative.

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The ABC campaign we can all support

anythingbutconservative.com.

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An ominous choice of words on ABC

“This is the election that could make and break relations between Newfoundland and Canada forever.”

- John Babb, president of the Provincial Conservative party,

Registered representative of the ABC campaign

VOCM Backtalk, Friday, August 29, 2008

 

Maybe the real objective of the ABC isn't what people claim it is. After all, it apparently isn't about giving the Harper crew a goose egg, at least if we can believe the ABC movement's leader, one Danny Williams.

Nope.

Maybe there's reason to ask Mr. Babb, the registered representative of the campaign with Elections Canada, just exactly what he meant by those words.

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Crude nears 90; likely to slide further

On Tuesday, crude futures on the New York Mercantile Exchange traded up slightly but still settled in below US$93 a barrel for October delivery.

That's still US$10 below where it was two days ago. Oil is down almost 40% from July and slide 10% in the past two days alone.

With the growing economic slump, demand is expected to lessen further increasing the downward pressure on oil prices.

“I guess the market was telling us it never belonged at the $100 level in the first place and got there on a lot of hype,” said Peter Beutel, energy analyst at Cameron Hanover, New Canaan, Conn.

Refined gasoline futures hit $2.40 a gallon the NYMEX according to the Globe on Tuesday.

More to follow.

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ABC Comedy Central - Masters of our own domain

where the truth is stranger than fiction

The UnLove Boat - In the season premiere of a series now in its 60th season, a provincial cabinet minister (played again this season by Provincial Conservative Clyde Jackman) bitches and moans incessantly about the quality of service provided by Marine Atlantic.

Yes, we know that's the same format, script and concept for every single episode of the longest running unreality show in political history.  Jackman managed to come up with a novel twist to open this season:  blaming a federal Conservative candidate for driving up the cost of gasoline worldwide and causing a North American economic slowdown, both of which were the real major causes for the reduction in road-bound tourism.

Highlights from last season:  In an episode titled The law of diminishing visitor returns, Jackman showed that doubling the provincial tourism advertising budget didn't produced the extra visitors everyone hoped for.

Yes, that's right, non-resident visitors, the people most of us would regard as tourists, actually contributed only 43% of the total economic activity generated by the province's tourism industry. ... We are spending more per visitor to attract them, but the return per visitor is diminishing.

In an episode called Didn't I see those at Canadian Tire?, Jackman's department bought a billboard at Ottawa airport that was billed as including "an actual clothesline hung with quilts".  It was based on the idea that people in eastern Ontario have never seen either quilts or clotheslines, apparently, hence they would be impressed by "actual" ones.


5 Wing:  In the season opener - Shocked and Odd - Provincial Conservative cabinet minister Tom Hedderson writes letters trying to get an elite anti-terror unit based in Goose Bay 18 months after the public learned the soldiers were going to another base in Canada.  Hedderson claims to be shocked by the news. Odd that he missed it.

Hedderson replaced the previous star John Hickey in the no-action comedy.

House:  Now in its fifth season,  less and less takes place in each House episode each year as the program morphs into a show about nothing.  In the budget episode from last season, finance minister Tom Marshall uttered the immortal words:

We are standing tall as powerful contributors to the federation – as masters of our own domain, stronger and more secure than we have ever been before.

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Replay 2008 round-up

1.  To start, a recommendation: go check nottawa's latest jab at the whole ABC thing.  He's got a thought about a missing quote that's worth pondering.

2. Has anyone noticed the morphing messages from the ABC corner? First there was the shifting goal - no longer about the goose egg;  now just about "the principle", what with the polls showing that Danny Williams' ABC was producing such a devastating effect on polls not just in this province but across Canada. That just makes it easy to claim victory even when Fabian Manning heads back to Ottawa, even though the goal was always to deliver a goose egg to the Conservatives.

BTW, evidently someone forgot to tell Jerome Kennedy that the goal had changed in time for Kennedy's appearance on Night Line. He was in full flight on a local open line show when he blurted out the goose egg line.  yes, we know Jerome.  It's hard to stop on a dime and shift directions.

Now it's the My ABC.  In response to accusations from the federal Conservatives that Danny Williams and his team are twisting arms and threatening people, the Provincial Conservatives are deploying their troops - Jerome was a lead this week - to insist that Danny had nothing to do with anything, the whole campaign is their campaign.  Nice marketing touch but highly unconvincing given that the guy came up with the idea, has been pushing it relentlessly, sent e-mails to make sure everyone in his caucus was on side and has bitchslapped cabinet ministers who dared question the wisdom of ABC publicly.

Nope.  No.  Nosirreee Bob.  No intimidation there.

3.  Speaking of Shawn Skinner, word is the minister made to humiliate himself publicly for daring to go off the message track is knocking doors for Siobhan Coady in St. John's South-Mount Pearl. Don't worry Shawn; there's a cabinet shuffle soon.

4.  Decisions, decisions. The drums along the highway running through Avalon make it sound like some Liberals are hard pressed in their choices.  As much as they want to vote for Liberal Scott Andrews, they'd have more fun sending Fabe back to Ottawa just to rub Danny's nose in it. Recommendation:  Don't vote for anyone who calls the province "NewfoundlandLabrador".

5.  Meanwhile, in St. John's East, some voters are wondering if they couldn't score a double play on one vote:  elect Westcott.  That would likely make the Premier's head explode while at the same time setting everything up for Westcott to tackle Harper, as he inevitably would.

6.  At least one mayor is now sending out begging letters to Ottawa. Imitation is the sincerest form of flattery.  Well, maybe that or just another guy looking to horn in on somebody else's spotlight. 

7.  Takes one to know one.  Memorial University political science professor Michael Temelini on Craig Westcott's candidacy: ""Is the real Craig Westcott the one who was critical of Stephen Harper, or is it one who seems to be now abandoning all of his critical faculties and toadying up to the prime minister?" What happened to university professors who tried to be analytical in their comments instead of taking sides in a partisan fight?

 

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Turn the page

Campaigns that are purely negative don't work.

Relentless bile just doesn't get people to turn out to the polls and vote for something. 

People need something to vote for.

The federal and provincial Conservatives started out this campaign in an all-negative series of vicious personal attacks.   Provincial Conservatives attacked Stephen Harper.  Harper attacked Stephane Dion.  The only difference was the target.

But this video - one of the latest from the Liberals - is the kind of stuff that actually starts to make voters look twice. 

It offers a positive, upbeat message while at the same time conveying critical comment about the key opponent's position. 

The thread that runs through this spot is change.  It's titled "Turn the page", as in leave the past behind and move forward.

If you want to get a truly stark contrast in messages - even allowing for different formats - compare this commercial with the Danny Williams' speech from last week. 

Gutteral, angry and clearly focused on vengeance for past wrongs.  Take a look at any federal Conservative comment on Stephane Dion. Nasty and personal;  stinking of animosity.

Then look at this again.

There aren't two more starkly different ideas or approaches.

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ABC? Meet Elections Canada

Here are a few issues that appear to have been left unexplored for this election campaign in Newfoundland and Labrador:

1. The Canada Elections Act provides restrictions on advertising by third parties.  In this case, the Provincial Conservative Party counts as a third party.  There are caps, indexed for inflation. There's an excellent summary from Elections Canada as well as a handbook.

2.  A third party must apply to Elections Canada and be registered once it has incurred advertising expenses of more than $500. the ABC website would exceed that requirement if assessed at fair market rates for website design.

3.  "A third party may not be registered under a name that, in the opinion of the Chief Electoral Officer, is likely to be confused with the name of a candidate, registered party, registered third party or eligible party."

-  Progressive Conservative Association of Newfoundland and Labrador

-  Conservative Party of Canada

-  Progressive Canadian Party.

Go figure if that would count as confusing.

4.  As of 2130 hours Newfoundland time on 15 September, the PC Association of Newfoundland and Labrador is not listed on the Elections Canada website as a registered  third party. [dead link.  Go here and click on "Registered Third Parties"]

Update:  Someone over at the Provincial Conservative Party office got on the ball and registered the "ABC Campaign" as a third party under the Canada Elections Act. Note the effective date:  September 16.  It's not like this thing hasn't been on the go since October 2006 or anything.

Let's wander back through the list of registered third parties and see who was more on the ball than the ABC crew:

The first name on the list (as of 16 September at 2200) would be the Provincial Conservative party, doing political business as ABC.  Then there is Kevin Grandia, an environmental activist.  He registered on September 9.  Next comes Les sans-chemise. They registered on the 8th.

After that came Stephen Harper's old palls at the National Citizens Coalition (September 10) and the Professional Institute of the Public Service on September 13.

For those who don't know, John Babb is the president of the Provincial Conservative Party, in whose name the domain for the ABC website is registered.

No thanks necessary, John.  Your humble e-scribbler is happy he got the thing legally squared away.

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Provincial Conservatives launch ABC website

anythingbutconservative.ca

The domain is registered to the Progressive Conservative Party of Newfoundland and Labrador.  [Purely coincidental update:  Site goes live late on September 15.  Bond Papers notes the Elections Canada rules.  By midnight, Newfoundland time, the site is now described as being authorized by the financial officer for the ABC campaign, not the PC Association of Newfoundland and Labrador as it was originally.]

It's basically a rehash of material that could be found on any of number of any other websites over the past four years. In fact, the links page contains links to all the better websites.

Makes you wonder why the Provincial Conservatives  behind the website supported the federal Conservatives in 2004 and 2006.

Given that it's a political party intervening in the federal campaign, it will be interesting to see the public accounting of their efforts through Elections Canada.

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Churchill Falls: facts versus stuff that isn't factual

[revised 05 Sept 09]

Justice minister Jerome Kennedy referred to it.

Bill Rowe - former Smallwood era cabinet minister, the first Man in a Blue Line Cab and current talk show host at voice of the cabinet minister - tossed out the supposed refusal by the Government of Canada in the 1960s to grant poor, beleaguered Newfoundland a power corridor through Quebec back in the 1960s. In a conversation with some caller from Ontario, Rowe used the corridor story as an example of one of the Grievances Against Ottawa.

They are factual or based on facts, Rowe insisted, or words to that effect.

Well, there are facts. That is things which have been established to be true and accurate based on research and evidence.

And then there is stuff that isn't factual.

Like the myth of the power corridor and the refusal.

The only - that's right the only - publicly available account of the issue available appears to be a research paper by Jason Churchill for the Vic Young Royal Commission several years ago. Odds are good most of the people running around telling the facts haven't read Churchill's account, which is, it should be noted, based on considerable research.

Churchill argues that "the Quebec negotiators were aided by successive federal governments that both actively and passively failed to enact legislative measures which would have granted Newfoundland and Labrador unfettered access to the North American energy markets."

In making that statement, though, Churchill notes that at the time - chiefly 1964-1966 - the Government of Canada lacked any coherent national electricity policy. As such it is difficult to lay blame or responsibility for subsequent events solely at the feet of the federal government. Incidentally, Churchill's source on the lack of a coherent policy is no less an authority than John Crosbie saying exactly that.

The Diefenbaker administration proposed a national electricity grid in 1962. Quebec - and Newfoundland - opposed the idea as being solely within the sphere of provincial sovereignty under the constitution.

For his part - as Churchill notes - Smallwood preferred to develop Churchill Falls through the privately-owned BRINCO and quite evidently with Quebec as the partner. Smallwood wasn't prepared to have the federal government take control of a provincial area of responsibility.

However, "[f]ormer provincial and federal cabinet minister John Crosbie stated that when Smallwood rejected Levesque’s nationalisation offer, 'a golden opportunity disappeared'. The argument being that had the project been jointly developed, the subsequent profits would have also been shared equitably [between Newfoundland and Quebec]."

At this point in the narrative, though it is worth quoting Churchill's account in it's entirety. His version is succinct even though the issues are complex. Incidentally, the numbers in the text refer to footnotes in the original.

In the summer of 1965, the previous question of nationalisation of BRINCO was solved for Levesque by the federal government. Despite Smallwood’s refusal to nationalize BRINCO, a cheaper mill rate was secured for Hydro-Quebec when the Public Utilities Income [Tax Transfer] Act was changed. There was a 50 per cent to 95 per cent increase in the transfer to the provinces of taxes collected from utility companies. Newfoundland and Labrador passed the additional savings on to BRINCO which consequently allowed the Corporation to sell electricity to Hydro-Quebec at a reduced price.(31)

This federal action did not improve Newfoundland’s disadvantaged bargaining position. In 1966, a frustrated Smallwood lashed out and threatened to bypass the Quebec government and appeal directly to Prime Minister Lester Pearson to declare the Churchill Falls project to be in the national interest. Smallwood drafted a letter for the Prime Minister formally requesting:

the Government of Canada to invoke Paragraph (c) of Clause 10 of Section 92 of the British North America Act. If the Government of Canada would proceed forthwith to build a transmission line from Churchill Falls to a point where it would tie in with power grids in Eastern Canada it would ensure an immediate start on the construction of the Churchill Falls power project itself. In that case the power would be in production and available to consumers in Canada in 1971. (32)

This declaration would have enabled the federal government to transcend provincial jurisdiction.(33) Theoretically, this would have allowed for the construction of transmission lines through Quebec and directly to the markets [elsewhere] in Canada and the New England states. However, based on available evidence, it does not appear that the request was ever formally presented.

Former BRINCO President, Henry Borden, claimed that he and associates convinced Smallwood to defer making the request until news of Quebec’s response to a proposal was received. The positive response from Quebec in October 1966 made Smallwood’s request irrelevant. Another explanation given by former Smallwood cabinet minister and long-time friend, Frederick Rowe, argued that fears of Quebec nationalist terrorism was enough to dissuade Smallwood from proceeding. (34)

Of the various explanations presented, the one most relevant to the potential role of the federal government was related by Newfoundland and Labrador lawyer, Cabot Martin, who had interviewed Smallwood. Martin was told the Premier met Pearson personally to discuss the option but was rejected before he could formally present the request. Smallwood stated:

Mr. Pearson said, ‘Joe, I know why you are here and if you ask me I’ll have to say yes, otherwise we would not really be a country. But I’m asking you not to ask me because we will not be able to keep the towers up.’ Joey paused, then looked at me as if to ask ‘What would you have done?’ and said ‘So I didn’t ask him.’35

There are two major implications of the stories related above. The first is that Newfoundland’s interest was set-aside in the name of national unity and due to fears of nationalist violence in Quebec. If this is so, subsequent ramifications of the eventual 1969 contract illustrate that the province has paid, and continues to pay, a phenomenal price for its contribution to national unity. The second implication is that the ultimate power to make the request still resided with Smallwood who appeared to have the option of pressing the issue further. It was Smallwood who decided to either wait for a Quebec response, and/or not ask Pearson due to fears of the consequences of his request to have the project declared in the national interest.

When Smallwood did not press the issue of establishing a power corridor through Quebec, the province failed to achieve a stronger bargaining position for BRINCO with Hydro-Quebec. Despite the difficulties inherent in negotiating at a disadvantaged position, a Letter of Intent was signed in October 1966 which allowed construction to begin at the Churchill Falls site.(36)

In his account, Churchill does not make plain how the entire situation can be laid solely at the feet of the federal government.

The matter is, in fact, considerably more complex. Churchill shows in several key places, for example, where decisions taken by Smallwood and others facilitated the bargaining position subsequently taken by Quebec.

Moreover, while Churchill includes original documentary evidence for some of the discussion, his only source for the Pearson refusal is a 1996 article by former Peckford era policy advisor Cabot Martin published six years after Smallwood died and some 15 years after Smallwood had suffered a debilitating stroke.

Smallwood's memoir, I chose Canada, contains a reference (pp.466-467) to such a request. The account notes that Smallwood had lunch with J.W. Pickersgill and John Turner and discussed the request for the Government of Canada to declare the project of national importance under section 92 of the constitution.

There is no reference whatsoever to any discussion with Pearson at that point, September 12, 1966. Smallwood inserts in his memoir - essentially extracts from his desk diary for the period - a discussion of the potential problems with a corridor through Quebec, including safety from attacks by terrorists and it is at that point he makes a comment quoted by Churchill in his footnotes the value of the national designation. Smallwood makes an additional comment, which Churchill did not use, which may give a clue to Smallwood's own preference in bargaining with Quebec:

The threat might, however, be more effectual than reality. It was much like our repeated threat to nationalize (BRINCO).

The letter to which Churchill refers was drafted on September 29 and, as Churchill notes, appears to have gone unsent. In other words, the power corridor idea appears to have been a bargaining ploy by Smallwood.

None of this means that Cabot Martin's account of what Smallwood supposedly told him later in life is wrong or false either. By the time Smallwood and Martin spoke, details of the disastrous 1969 deal had already become part of the provincial political culture as the symbol of resource give-aways. Smallwood may well have mis-remembered events almost two decades earlier for any of a number of understandable reasons.

For example, it would be far better to blame Ottawa - an old provincial politician's trick - or leave the impression, as Churchill suggests as one possible explanation, that Smallwood made the only decision he could in order to save the nation. Subsequent events notwithstanding, Smallwood was not prepared to risk the country he'd chosen for what he had described in his memoir as a risky proposition in the first place. Smallwood's account turns a failed bargaining ploy and its ignoble consequences into the noble self-sacrifice of a statesman and, by extension, his beleaguered people.

No matter how one looks at it, the available evidence does not support the claim, no matter how much the story is handed around, that the federal government refused a demand to invoke a constitutional provision and force a power corridor through Quebec.

The power corridor story has become, like the entire Churchill Falls saga, nothing more than a convenient story to be trotted out by politicians past and present when it suits their purposes.

The story, however, is no more factual than any other fairy tale.

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Dion: money and new ideas for the fishery

At an announcement in St. John's today, Liberal leader Stephane Dion pledged to invest in the fishing industry, including:

. $70 million to retire core commercial harvesting licences for fishermen and women who want to get out of the business.

. $250 million for a Green Fisheries and Transport Fund that would provide rebates and incentives for investments in the latest technologies to cut fuel consumption and to help finance modernization of fishing vessels and on-shore equipment to make them more energy efficient.

. $100 million to improve small craft harbours across Canada, including $25 million for harbours in Canada's north.

. A pledge to try to establish the first international protected area for the vital cod nursery to prevent foreign over-fishing of the Tail of the Grand Banks.

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Government gas price fixing explained

Well, sort of.

There's no point in having a provincial government price fixing analyst try and explain why the system of government price fixing for oil works. 

He only knows how it works.

Sort of.

Something missed in the interview with CBC this morning:  if David Hillier and his colleagues use spot pricing to set fix the price of gas in Newfoundland and Labrador, then what about companies that bought futures last at considerably less than the current spot price price?

We really didn't get that in his talk about supply and demand (an Economics 101 example with lumber).

There may be good reason for the current spike in prices.  The major problem seems to be that consumers in Newfoundland and Labrador won't get the advantage of lower prices which will comeas Gulf coast refineries come back on stream.  Won't get it like we haven't seen drops lately when 25% of refining capacity wasn't shut down but, all the same, gas prices didn't meet whatever triggers there are in arcane formula the gas price fixers use that would actually send gas prices down.

You see, market forces -  supply and demand and simple competition in the marketplace  - will move prices up and down on their own. It's Economics 101.

We don't need a bureaucratic apparatus - way too cumbersome, undoubtedly unwieldy, and completely inscrutable - to fix gas prices in the marketplace.

That's more like State Planning 101 from 1920s Russia.  We all know how effective that model of economics worked.

Well, that is if the "we" is consumers.

We consumers can get along just fine without government gas price fixing.

This government gas price fixing  scheme makes you wonder who the "we" is the this thing is set up for.

Makes you wonder about that almost more than why it is that the cabinet minister responsible for the price fixing scheme isn't on the air defending it.

Maybe we can ask the guy who introduced this price fixing scam to the province in the first place.

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Dion's in town

The first bit of his schedule is at liberal.ca.

Some announcements on fisheries and offshore revenues, according to news media.

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Full moon and a call to arms

Justice minister Jerome Kennedy took time to call the Sunday evening talk show at the voice of the cabinet minister to lambaste Stephen Harper and the federal Conservatives.  He insisted, among other things, that the Family Feud was embraced by all Provincial Conservatives including him.

Fair enough.

It is a family feud, after all and Kennedy is part of one branch of the family doing the feuding.

In the course of his lengthy rant, Kennedy hit on a litany of supposed injustices done to Newfoundland and Labrador by Uncle Ottawa over the years.  Included among the old chestnuts was a reference to something that supposedly took place in 1931. 

Kennedy didn't elaborate.

The whole thing sounded like a call to the barricades.

But 1931?

How about Blaine-Bond, anyone?

If the Airing of Grievances is going back to 1931  - 18 years before Newfoundland and Labrador was a Canadian province - it's likely only a matter of time before the minister of justice finds some Great Injustice in a time before Canada even really existed.

And when was the last time d'Iberville's campaign in Newfoundland used for political purposes around these parts?

Generally, there had been little friction between French and English fishermen in the 1600s. There was growing friction, however, in that century between France and England, and the hostility between the two countries often spilled into Newfoundland. The winter campaign of Pierre Le Moyne d'Iberville in 1696-1697, which resulted in the destruction of almost all of the English settlements in Newfoundland, was simply the most sensational demonstration of this fact. Eventually, because of military and strategic successes elsewhere in North America and around the world, the French agreed to recognize British sovereignty over Newfoundland.

There's an interesting connection in that story, by the way.  D'Iberville raided along the coast of Newfoundland until he reached Carbonear - in the district Kennedy represents - only to find the residents had taken refuge on a nearby island which they had fortified sufficiently to defend against D'Iberville's attacks.

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Yawn

Harper was in town on Saturday.

Just a bit of In-out, In-out.

And a candidate whose sign people can't even spell his own name.

 

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Family Feud? Try blood feud.

The local media are strangely silent the day of Stephen Harper's visit to the province. The prime minister comes to the province and not a single story graces the website of the Telly, CBC or the voice of the (provincial) cabinet minister. [Update: The Telly posted an extremely short story after 9:00 PM. VO updated at some point this evening but it isn't clear when.]

Okay, it's not like it's the first time a huge local story has been missed by the locals for one reason or another , only to be picked up by the national types and then covered locally later on.

Like this report from CTV's Bob Fife. Watch the video, even if you have to listen to Jim Morgan.

It doesn't matter if the accusations of heavy-handed tactics by the Provincial Conservatives are true or not. The point is that the charges are being made at all and made hard by the federal Conservatives on national news media.

Danny Williams already backpedaled on the ABC campaign's objectives today, likely setting up for a possible win by manning in Avalon. It's a tight race but you never know what can happen. Better to change the objectives to allow for something other than the total victory you wanted only a couple of days ago, you know, just in case.

In the meantime, the federal Conservatives have decided to play their own form of hardball. Even Stephen Harper's use of the Williams campaign slogan in 2007 is designed to get under the Premier's skin.

This is not a family feud. It's rapidly turning into a blood feud.

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What a difference it makes when you pay attention

First a link to Rex Murphy on The National in October 2007, with the references to Danny Williams being in the political sweet spot not found by a politician in Newfoundland and Labrador since Joe Smallwood. About three quarters of the way through there is a discussion of Stephen Harper. Williams seemed to have been unaware of speeches and other public comments until then; Murphy and Williams chuckle a lot. The tone is light with much emphasis on the political triumph for Williams and the economic miracle which seemed to be linked to it and him.

Murphy produced a glorious homage, right down to the line early on in which Williams attributes his popularity to his embodying the heart and soul of Newfoundlanders and Labradorians.

Fast forward to this Saturday and a column in the Globe and Mail entitled "Danny boy has gone too far." Murphy's words are scathing:

This "standing up for Newfoundland" palaver is best administered in small doses, if at all. And it never fits the mouth of the person doing the "standing up." Furthermore, a difference of opinion, a clash of party interests, should never be categorized as a clash of patriotism. There is a jingoism of small places as well as of large. And Newfoundland is more susceptible to it than most. Newfoundlanders are ferociously fond of Newfoundland, but that very affection can play havoc with our judgment and our politics.

The final three paragraphs summarize as well as any might exactly what some in this province have been saying publicly and increasingly more are saying privately since 2004:

It's not Mr. Williams's quarrel with Stephen Harper that's at question. It's hauling into that quarrel all the rhetoric of "disloyalty" to Newfoundland, stirring the jingoistic fevers, and characterizing those on the other side as unworthy. Newfoundlanders have been lucky in past decades that, when we had strong premiers, we had strong ministers in Ottawa.

Danny Williams has reached such supremacy, however, that he has effectively become the only voice in Newfoundland politics. Mr. Hearn is gone. John Crosbie is in honorific heaven. And now there's only Danny. That's bad for us. It's bad for him, too, should he care to think about it.

He should look over history's shoulder and take in what happened to Joey Smallwood, a great premier who subtracted from his own legacy by succumbing to the vanity of power, the great corrosive self-flattery of believing that being in charge is the same thing as always being right.

Murphy is indeed right, but then again, regular readers will have heard similar arguments even if they were less elegantly expressed. Unfortunately, now that the cult of personality has met political hegemony, Murphy can only stand by for inevitable round of insults and accusations which have met everyone else who has dared to challenge the new orthodoxy.

It is perhaps just good enough that Murphy finally took a hard look at his home province. It is amazing what a difference it makes when one merely pays attention.

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