And a week later everywhere else...

IOCC ices expansion plans.

December 2 at Bond Papers, thanks to Kathy Dunderdale's loose lips in the House.

December 10 everywhere else.

It's not like the conventional media don't cover the legislature.

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The economics of Snuffleupagus

Funny thing how people miss stuff.

Like a Bank of Montreal economist who offered this view of the provincial financial state:

"The commodity boom has lined the province's coffers," he said. "Meantime, a reversal in migration flows has sprung population growth back into positive territory after three years of outright declines - an important development given that a lack of skilled labour could be a constraint on the province as offshore development picks up speed and major construction projects come online."

If "lining the coffers" means supported spending way beyond what is sustainable then he's right, but look at that migration comment.

You'll see similar views coming from the provincial government, not surprisingly.  There's lots of talk about the growing population as another sign that the fiscal messiahs are now in charge and that their "plan" is working.

That would be the plan, by the way, that Barack Obama is following.  No, gentle reader, that isn't some effort at humour.  It's a real quote and yes, he believes every word of it.  That's just how brilliant this crowd are.  This plan  - which consists of nothing more grand than spending everything that comes in through the door - must come from all those books, well not books really but articles and magazines the Premier reads 24/7 on a go forward basis to try and keep track of what's going on out there.  

But we digress.

This migration thing.

Three years, eh.

Only goes to show how much these bank economists don't know.

The outmigration problem - and net population decline - goes back to the cod moratorium of the early 1990s. 

It hit some new records in the best years of Danny Williams economic miracle.  That's right.  At a time when the economic miracle was taking hold people were flooding out of the Happy Province in near record numbers. The chart at left gives an idea of how big the problem has been.

There are parts of the province that are almost entirely dependent on migrant labour and remittance workers.

In others - like Stephenville - the economic disaster of losing a pulp and paper mill on the Premier's watch didn't materialize solely because the workers there could find jobs in Alberta.

But yes, you say, there has been more people coming back to the province since 2007, you say.

And yes, that's true, but it isn't because of great economic opportunities in this province.  Look around, especially outside the overpass.  All those enormous, job-creating projects that were supposedly luring people back don't actually exist.

Even though he mentioned them in his financial statement, finance minister Jerome Kennedy told CBC Radio this morning that - in fact - the big projects that supposedly exist to keep the fire going in the economy, stuff like the Lower Churchill, don't actually exist right at the moment.  These are projects Kennedy and his boss are "trying to get money for", according to his own words.

People started coming back to Newfoundland and Labrador, just as they have done previously, in advance of a major downturn in Ontario and Alberta.  Only the stupid came back for jobs that - as Jerome Kennedy knows - don't exist.  The housing boom in St. John's is driven largely by the movement of people within the province toward St. John's where there is at least the chance of decent work. The open taps on those public coffers don't hurt either. You'll find detailed discussions of the whole population thing over at labradore.

It really is funny how people miss stuff. Really obvious stuff that is readily available in the public domain.  People who - presumably - actually keep track of these things like bird-watchers scanning the trees for this winged thing or that.

Evidently not.

Evidently, great big yellow birds get missed a lot.

Aloysius Snuffleupagus would understand.

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An accountability problem for Jerome

Aside from being one of the most arrogant and condescending finance ministers in a long time, Jerome Kennedy might need to brush up on his math a bit.

Here's a sample of the arrogant and condescending finance minister in action first:

It is important, and whether or not the – I understand that the Leader of the Opposition does not understand. Nor would I necessarily expect her to. The reality is that this is not artificial spending here. We are not borrowing to spend on infrastructure. We are taking $1 billion and putting into infrastructure.

Everyday Jerome is on his feet there's at least one of those sort of slimy comments. Totally unnecessary, but he makes them every day.  Too bad there's no one like Antonio around to teach the poor fellow some manners.

But that's not the problem.

Here's the problem:

In Question Period, Jerome revealed that the province's unfunded pension liabilities have grown, according to the finance minister, by $1.5 billion as a result of the downturn in the world economy.  Here's what he told the House:

As the Leader of the Opposition is aware, in 2006 we paid $1.953 billion into the Teachers’ Pension Plan, and a further $982 million into the Public Service Pension Plan 2007, trying to bring these pension plans up to the funding levels of 80 per cent to 85 per cent, which is suggested.

The recent downturn in the economy and what has happened, Mr. Speaker, has resulted in approximately, right now, a shortfall of $1.5 billion in terms of our pension funds. That is not unexpected in light of everything that has gone on, and some of the figures I think I gave last night in terms of losses by the banks.

One figure, though, that becomes important, Mr. Speaker, although we have decreased our debt servicing charges by approximately $200 million, there could be a result in the pension cost next year of an extra $180 million.

That last figure is only somewhat important.

It is only important to the extent that in his financial statement on Tuesday Jerome patted himself on the back for reducing the debt servicing charges.

In the House, he revealed that - all things considered - those charges will grow by roughly the same amount as the decrease this year.  That is important considering that expenditures are going up while revenue is going down.  Not a good position.

But look again at the front end and the middle bit of that quote because that's where the big problem comes in.

The $1.9 billion is the Accord 2005 money received in a lump in 2005 and already spent.  The $982 million - if memory serves - was borrowed.

But all that doesn't matter since the pension fund has lost $1.5 billion in value in the space of a few months.  Apparently those shopping malls mortgaged in Ontario and British Columbia to Great-West Life, among others, aren't pulling in the expected bucks.

The inconsistencies among Jerome's comments at different times gives the old boy a basic problem:  an accountability problem.  He just can't seem to give a straight account of the province's financial state.

That's a pretty bad thing for a finance minister because if anyone needs to be able to keep his accounts straight,  it would be him.

Bottom line?

We won't know the real financial position of the province until sometime after March 31, 2009 and even then we'll likely have to take Jerome's words with a grain of salt.

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The Last King of Chicago

From the Canadian Press:

“You know what I like the most is Barack Obama is listening to what we're doing here,” Mr. Williams said during question period to roars of applause from his Conservative caucus.

“That's a great compliment to this province because I have a lot of respect for that person.”

Here's the rest of it from Hansard:

Premier Williams:...Obama outlines initiatives to create 2.5 million jobs; make public buildings more efficient; repair roads and bridges; modernize schools; increase broadband access –

Some Hon Members: Oh, oh!

Mr. Speaker: Order, please!

Premier Williams: He will do it right because we did it right and he can have our (inaudible) any day of the week.

You just cannot make this stuff up.

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Poll goosing harder than ever

The provincial government's pollster released the results of its most recent work on Tuesday. The graph with the orange line shows the party support numbers for the Provincial Conservatives for the past year and a bit as reported by Corporate Research Associates.

Interestingly enough the polling period included a bunch of hype at the front end about aluminum smelters in Labrador in addition to the usual poll goosing goodies.

The Premier rushed out the story of "Have" province status a couple of days before the surveying started.  There was more than a bit of media coverage for that and the associated video and the great party he was planning.

Of course, he knew at the time that the province might opt for the O'Brien Equalization formula and thereby become a "have Not" province again before the fiscal year was out, but that never stood in the way of a good goose.

Odd that he rushed that story out there wasn't it?  Almost like he knew the pollster was about to start calling people.

The polling period cut off before AbitibiBowater made its announcement.

In any event, it's interest to look at the party support numbers, adjusted as a percentage of all respondents.

That's very different from giving it as a percentage of decideds.  That number fluctuates a bit.  When you report as a percentage of decideds you inflate the apparent level of support for one option or another.  Like in this case:  the Provincial Conservatives have these wildly stratospheric numbers which feed into the myth of political infallibility and invincibility.

So hang on a second now.  In the blue graph, we have the same figures adjusted to take into account the undecideds. 

You still wind up with the climb at the front and the drop in the past quarter.  In between, though, you don't have the same steady state.  Instead you get a gradual decline.

But then there's that bit at the end.  A drop of 11 points since this time last year, six of which came in the past three months. That's an oil-price-like decline.

The numbers themselves aren't all that stratospheric.  In fact,  one suspects that people might have an easier time accepting the blue numbers these days given the state of the economy and the recent troubles in public sector bargaining.

Either way there's a precipitous decline over the last quarter that is surely causing a few people to sit up and take notice.  Consider the amount of fairly obviously orchestrated poll goosing that went on - including the smelter and the "Have" province crap - all of which still added up to a decline.

Now given the huge gap between the Conservatives and the other two parties, it's not like people around here are going to start seizing airports or anything.  They aren't migrating across the border to find water and medical care. 

Still, though, if local media are going to report poll results - even as sparsely as some did on Tuesday - they should apply a little analysis.  Episodes like the "Have province" should be put in a context that is, to be brutally frank about it, so damned obvious after four years of relentless poll goosing that it's pretty hard to miss it.

The government may have put has happy a face on the financial situation as possible but it certainly looks like something is changing in the political landscape.  Let's see what the next couple of quarters bring.

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The provincial budget update: six points

1.   The long and short of it:  Some revenues are higher than projected.  Spending  remains the same.  The update runs six pages.  Four of them are devoted to a rehash of things we already know and a heck of a low of stroking for supposed prudent fiscal management.  What’s left is pretty thin, at least for anyone who wants to get a handle on.


2.   Missing revenue numbers:  Interestingly the provincial government only mentioned three specific revenue sources which are performing above budget estimates from last spring. Unmentioned was revenue from mineral revenues other than oil.  Last year it was big enough to warrant a mention.  This year:  zip.  Either mineral revenues are on par or down or the government is saving that for the spring to offset some bad news.

3. The political value of lowballing:  Underestimating revenues and overestimating costs is an old trick to make your budget performance look better than it really is.  This year – for the first time in three years – the provincial government’s practice of lowballing oil revenues didn’t really work out as planned.

In prior years they could forecast deficit spending and be reasonably assured oil would perform beyond the expectations.  At the end of the year planned borrowing was replaced with cash spending.  That’s how deficits never really appeared.  It’s also how the Premier could keep claiming that surpluses were being directed to debt reduction and that – as this update claims – there is a magical plan at work which delivers even in relatively bad times.  The faithful sop it up They even go so far as to claim the Premier can’t be blamed for the downturn even though they give him all the credit for the cash rolling in when it rolled in. 

This update gives an excellent example of how to inflate performance by lowballing.  There’s $70 million missing from the spring budget projection for oil royalties.

Okay.  He can’t.  But he also can’t claim the credit for the great times in the past couple of years since he didn’t deliver those either.  The faithful can be spotted by the purple freshie stains on the corners of their mouths.

4.  The extras cash revenues (corrected):   Note that the budget update gives the budget estimate for oil royalties $70 million below the actual number from the Estimates.

	Forecast	Revised forecast	Difference
Oil Royalties	$1.789 billion	$2.202 billion	$413 million
Personal income tax	$674.8 million	$831.8 million	$157 million
Sales tax	$631.589 million	$664.589 million	$33 million
Total variance			$603 million

5.  Surplus or deficit?  This all goes back to an issue raised here last September. Given that the accrual surplus is now revised to be $722 million higher than forecast, there are a few bucks missing from the update.  Even at $722 million in additional revenue, the budget would still be short on a cash basis by $72 million.  Given recent practices, and given that this year there are no anticipated savings through spending cuts, the cash deficit could easily run to upwards of $200 million by the year end.

6.   Prophetic words from last June: 

In order to produce a surplus of the size predicted  - but predicted only in political statements - oil prices would have to continue at double the figure of  $87 a barrel used to come up with the budget.  So far, it looks pretty good for oil to be somewhere over $130 on through the end of this year, but you never know what will happen with oil prices, especially after the American elections in November and the new president is sworn in late in January 2009.

Okay, so at the time, it looked like oil was going to stay high.  And in making the comments, your humble e-scribbler was also pointing to the difference between an accrual surplus – including cash that really isn’t there – and the cash situation which might under certain circumstances require new public debt to make things balance.

The key point, though, is that you never know with oil prices.  Shortly after that post, oil peaked at $147;  incidentally that’s not $145 or $150 as reported in a couple of spots in the news release and update document issued by the provincial finance minister today.  As it turned out, oil prices started falling in late summer and with the credit crunch, the drop accelerated. In the end the provincial government can report an accrual surplus that looks amazing but on a cash basis, they’ll likely wind up having to borrow cash to settle all the accounts.

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Locking the barn door: prisons report version

The provincial justice minister released a report on Monday into the provincial prison system.

The hard copies handed out to reporters had sections blacked-out for various reasons. Those copies made it impossible to see the words that were redacted, to use the popular phrase.

The electronic version wasn't quite as effective.

Somehow, the blacked-out bits of the pdf didn't really remove the words. They merely masked them. As CBC discovered, if you copy the text and then paste it into any simple word processing software - like say Notepad - the words covered by the black boxes magically appear.

The original electronic version was available until after lunch. It's now been replaced by a version that has puts bits of punctuation in place of the excised words if you block copy the bits including the black redacted strips.

Never fear.

CBC has posted a copy of the report as it originally appeared so people can get the originally released version.

Inferring from context, it is possible to see in some instances that the excised sections of the report deal with security in the prisons.

Others are odd.

Like this bit from the second version released by the justice department:

One of the persons interviewed stated ------------------------------------------------------
------------------------------------------------------------------------------------, spoke of the
atmosphere of mistrust and stated that “the environment is such that you have to be
careful who you tell things to.” Several times during the Panel’s interviews with --
---------------------------- referenced what -- perceived to be the lack of support from
“the hill”, noting that he had files of documentation that would support --- claim.

Look at that last bit: "...referenced what -- perceived to be the lack of support from 'the hill', noting that he had files of documentation that would support --- claim."

"What [blank] perceived" and "would support [blank] claim" suggest that the words chopped here somehow make reference to an individual. Under section 30 of the province's access to information law, government can't disclose information on particular individuals in certain circumstances.

Now, we've seen already bizarre examples of how the government secrecy apparatus - D.B.A. "access co-ordinators" - interprets this section. Documents summarizing information already in the public domain were edited to exclude the name of a judge involved in a trial, for example. Information about public servants acting in their capacity as public servants are to be left in but people who aren't public servants are omitted.

This became clear in testimony by Renee Pendergast at the Cameron Inquiry on the issue. Pendergast is no average bureaucrat. At the time of the issues under review by madam Justice Margaret Cameron, Pendergast was the access co-ordinator for Executive Council. She's since returned to her usual job vetting access requests for the department of justice's access co-ordination section.

COFFEY , Q.C.: After the matter passed through - - while the matter was passing through your office , his name was redacted in relation to - - in a briefing note , a government briefing note referring to the fact that some matter was ... this particular matter was before him and the status of it at the time , and his name was redacted. Could you tell the Commissioner, please , what the rationale is that would have someone like Judge Thompson's name redacted in these circumstances from a Cabinet briefing note?

MS. PENDERGAST: And I realized that that name was done when we had done our pre - interview , and I can assure Madam Commissioner that that was done in error. His name would have been left in. I'm assuming it was because I really did not know who he was at that time , and I redacted it under those circumstances , but under normal circumstances , if I had realized who he was , his name would have been left in.

COFFEY , Q.C.: Can we actually bring up - -

THE COMMISSIONER : I'm sorry , did I misunderstand what you said earlier. I thought you were saying that even though it might seem frankly silly to some of the rest of us , your interpretation of the legislation was that if the information contained a name which was other than a civil servant presumably conducting their business , that would be deleted. So why wouldn't Justice...

MS. PENDERGAST: Because , I guess , we considered him for him to be a Judge at this point , and his name would be allowed to be left in. He wouldn't be considered to be a - - like , would he be affiliated - - and I'm not sure if he's a provincial judge or - -

THE COMMISSIONER : No , and believe me , he would not consider himself to be affiliated with the Department of Justice.

MS. PENDERGAST: . Yeah , yeah , so - - and I don't know that. That's the reason why chances were his name was released - - was withheld.

COFFEY , Q.C.: And just in relation to that because that was the way when Ms. Brazil was asking about it , you did indicate that , well , if the vetter as it were , in your position - -

MS. PENDERGAST: Uh - hm.

COFFEY , Q.C.: did not understand that a particular name was that of a civil servant , then the name went?

MS. PENDERGAST: And we would double check some of them if we weren't sure , absolutely.

COFFEY , Q.C.: But - - that's the criteria , if it's not a civil servant - -

MS. PENDERGAST: It's withheld.

COFFEY , Q.C. : 23 Q. Withheld.

Okay.

So in the section from the prisons report, this particular individual or individuals covered by the excised portion would be public servants speaking in their capacity as public servants.

Odd that their views are removed - odder still that it's only in part - and in that last sentence the clipping relates words that function as the subject of the verbs involved are also plucked out.

Maybe they were proper names, one might think, as in "Mr. Jones perceived" and "Mr. Jones' claim". If that was the case, then the word "he" that appears in between ought to have be chopped as well since that word also tends to identify the gender of the informant.

Read the CBC version using the Microsoft magic decoder and you discover that no proper names appear at all.

There's another head-scratcher in another section that deals with concerns among prisons staff about the lack of appropriate recognition given to a staff rowing team. The excised bit is completely mystifying since it contains no information on the security of the prison system, does not tend to identify third parties - i.e. people who aren't public servants - and generally just carries on the narrative of the issue which is left in. If problems with morale and the causes of said problems or irritants related to it are left in the document, it makes one wonder by what truly insane line of reasoning the excised bits were chopped.

Now the prisons report has more than enough in the public versions to give people cause for concern. The redaction weirdness comes - unfortunately for the current administration - at a time when their are renewed questions about its commitment to openness and transparency. They talked a good game while in opposition but, as the Cameron Inquiry and a recent set of articles in The Telegram show, the actual performance falls far short of the mark.

Some of the access problems may well have to do with bureaucratic inertia. Your humble e-scribbler has been lied to by one access official. In another case, in response to a simple request sent to obtain information in exactly the manner described by the government's own policy statements - low cost and informal - your humble scribe met with the request being shunted to the access co-ordinator who, in turn insisted that the request had to be made on the appropriate form and would be dealt with only after the appropriate fees had changed hands. That isn't government policy but the co-ordinator knowingly insisted on it merely as a means of frustrating a simple request.

In largest part though, one is tempted to point to the tone at the top as being the culprit. Public servants do not like to disclose information, as a rule. They like to find ways to hold things secret. That's a characteristic of bureaucracies the world over since the people in the bureaucracies know that information is power.

They are encouraged in the zeal for secrecy by episodes like the one in a tussle between the auditor general and the Premier over access to cabinet documents related to the cable deal. The Premier invented excuses to avoid disclosing the documents to the person he appointed to review the affair. He then relented, admitting in the process in effect that his earlier excuses were lacking in substance. later still, we saw the changes to the access to information that would - in effect - block members of the public finding out how much toilet paper the province's energy corporation buys at any given time let alone what contracts it enters into.

In the prisons report case, the government censors wound up locking the door long after the information horse had bolted. Nevertheless, their cock-up does give some insight into how the system works. Looking at the redacted version and the inadvertently unexpurgated copy of the report, one cannot see any obvious, legitimate reason for withholding any of the bits that were excised. If anything, the bits hidden under the black bands reinforce the points made throughout the report and left there for the public to see.

They were cut, though and the people of the province weren't supposed to see them.

You have to wonder why the decisions were made to chop those bits in the first place.

And if this is the sort of stuff they deem unworthy of telling you, you really have to wonder what else they are keeping secret.

-srbp-

Michael Ignatieff: the "Whips and chains and cuffs, oh my!" version

Heard from the kinky corner recently:

"While I support torture on a personal level, I am not sure it makes good national policy."

-srbp-

The powers that be

1.  Congratulations on your new budget, Mr. Harper.  Michael Ignatieff never supported the coalition. 

Period.

He never did.

He never will.

With Ignatieff as Liberal leader, the coalition is now dead as a doornail and Stephen Harper has a green light to rule.

Your humble e-scribbler heard Ignatieff speak in St. John's the week the coalition appeared. He could not have damned it more if he had opposed it flatly and in plain English.

Too shrewd a politician, he waited to declare his concerns until after the coalition failed and he had put the conditions in place to take the leadership. [Think about it for a second.  This is a guy whose spinners  claim he has the support of 55 of the 77 member Liberal caucus.]

As it stands, Michael Ignatieff will be the best friend Stephen Harper ever had, at least in the short term.  Harper will get his second kick at the cat in January without a problem.

The Connies are already opening the champagne.  They know Ignatieff's weaknesses and they can watch his manoeuvering and understand him for exactly what he is.

They know him because they have one of their own.

At least one.

They took their first shot at him on Monday.  Expect more of it.  It won't get any better.

The Liberal Party did not send Bob Stanfield to defeat Bob Stanfield.

Think about it.

2. Congratulations on your long second term of office, Mr. Harper.  The Liberal Party is not ready for an election and will not be ready at any time in the next two years.  It needs fundamental reform at the policy level and especially at the financial level.

Those things will take longer to put in place than a handful of months and on the financial side, the reform and re-organization will take longer to implement and take firm hold.

Stephen Harper is safe in office for the balance of 2009 and likely well into 2010.  His entourage may well take the party to war before that but they run the risk of crashing against some pretty hard rocks.

3. They are called the backroom boys for a reason. The backrooms line up for a candidate.  That pretty much sums up the view of the party about things like new ideas and new people. 

Take a look in Newfoundland and Labrador.

Multiply that by 10 provinces.

You get the point.

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Brent breaks 40

Brent crude - the benchmark for Newfoundland and Labrador crude - settled at US$39.74 on Friday for the first time in four years.

West Texas Intermediate  - the price usually quoted by news media - closed the day at US$40.41.

The forty dollar mark has become a new marker both for analysts and the news media in the current  economic crisis.

On Thursday, a former Merrill Lynch analyst said that conditions may exist to bring crude oil below US$25 for a short period:

“A temporary drop below $25 a barrel is possible if the global recession extends to China and significant non-OPEC cuts are required,” Merrill commodity strategist Francisco Blanch said in yesterday’s report. “In the short run, global oil- demand growth will likely take a further beating as banks continue to cut credit to consumers and corporations.”

January put options on $20 oil - the option to sell at a specific price on a specific date - were popular on Friday.  What that means  is that there was increasing speculation  - although still very small - that oil would be that low by January.

Related to that, analysts no longer assume that China will be immune from the effects of the recession.

“Everybody – even the most bullish people – have now given up on the decoupling idea,” [Stephen Briggs, analyst at RBS Global Banking & Markets] said, referring to the argument that China was making up for any demand slowdown in the United States.

Merrill Lynch is now slashing its forecast average price for crude in 2009.  On October 1, the company projected US$90 but this week lowered the estimated average to US$50:

“In our view, oil prices could find a trough at the end of Q1 2009 or early Q2 2009 with the seasonal slowdown in demand. Then, as economic activity starts to strengthen, we see oil prices posting a modest recovery in the second half of 2009.”

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Norsk Hydro ponders production cut

Norwegian aluminium giant Norsk Hydro is considering a cut in its existing production in light of a dramatic global drop in demand for aluminium and aluminium products.

Norsk Hydro said the crisis has led to "substantial problems for the construction and automotive industries, which are among the metal industry's most important markets".

"This has again triggered a dramatic decline in demand for aluminium products," added Hydro, which has in past years restructured its aluminium products business, including exiting numerous less profitable automotive parts ventures.

So much for that big announcement in Labrador about a new smelter.

So much too for the idea that growth in China and India would offset any American downturn in the markets.

“The industries, economies are now in serious pain through the world,” said Stephen Briggs, analyst at RBS Global Banking & Markets.

“Everybody – even the most bullish people – have now given up on the decoupling idea,” Mr. Briggs said, referring to the argument that China was making up for any demand slowdown in the United States.

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Wanna try that poll again?

Okay, leave aside for a second the fact the CBC headline on EKOS' robopoll is grossly misleading.

Would the poll results be the same now that we discover the country had the highest job loss last month in 26 years?

Maybe the Ontarians who talked to EKOS' machines will be rethinking their position.

-srbp-

"There are no cheap seats in the House of Commons"

As it turns out Jack Harris was on his feet when the proclamation proroguing parliament arrived in the House of Commons.

He holds the distinction of being the last member to speak in what is surely the shortest session of the parliament of Canada in history.

That isn't as important as what Harris was saying at the moment the proclamation was issued.  Harris delivered an eloquent speech about parliament, the importance of individual members and the current crisis.

Following is the extract from Hansard, for the record:

Mr. Jack Harris (St. John's East, NDP): Mr. Speaker, I have been involved in parliamentary democracy in a direct way for about the last 21 years, first in the House and then for 16 years in the legislature of Newfoundland and Labrador. I was happy to be re-elected to the House in the October 14 election. I have never been so concerned about
the state of parliamentary democracy in this country as I have become in the last week.

I know hon. members are rising in the House and thanking their constituents for electing them or returning them to office, and I have applauded each and every one of them. Then, they have proceeded in some cases on the government’s side of the House to talk about the
Prime Minister and the government having been elected. There, they veer from the path of parliamentary democracy. The current Prime Minister was not elected as the prime minister. That is not the way Parliament works. Each and every member of the House is a member of
Parliament and has the right and duty to represent his or her constituents.

I heard one hon. member opposite this morning talk about the cheap seats in the House of Commons. I am assuming he was referring to either his own back benches or to the opposition members’. I do not know. However, let me say this: there are no cheap seats in the House of Commons. We are all equally elected to represent our constituents and our interests. Parliamentary democracy allows the leader of the party with the most seats in the House to go to the Governor General and in the case of a minority government either resign or ask or advise the Governor General that he or she wishes to seek the confidence of the House. That is our system. That is what makes a person prime minister: having the confidence of the House.

It is assumed that, if you have a majority of seats in the House of Commons, you are the prime minister and you can form a government. However, after this election, a new government was sworn in, not the old government. That new government was sworn in because the sitting Prime Minister was able to say to the Governor General that he will
seek the confidence of the House. That is what we are doing now. We are now in a situation where the confidence of the House has been lost by the actions and failure of leadership of the Prime Minister of Canada.

What is the response? The response is a refusal to face the House, a refusal to govern with the support and confidence of the House of Commons and an attempt to use the notion of prorogation. Let us not use the fancy word. He wants to shut down Parliament because he cannot face the music. The reality is that he does not have the support of the House. The government does not have the support of the House. He has failed in his obligation to try to maintain the support of the House.

There has been a lot of talk about a government that works for Canada and supports working with other parties in Parliament. We all pledged to try to do that. However, someone broke that pledge last Thursday. They broke that pledge by refusing to reach to all parts of the House and to devise a plan that meets the support of at least the majority of the House to come up with a recognition that the recession that is upon us requires some immediate action.

In my own province of Newfoundland and Labrador today, it was announced by AbitibiBowater that a paper newsprint mill that has been there for over 100 years will close. Eight hundred people will be thrown out of work. Two weeks ago, I raised in the House the question of whether the government would support a program for older workers and training for younger workers who could save this mill. Nothing happened, and the mill is now closed as a result.   There is only one party in the House that is standing in the way of a government that works for Canadians. The opposition parties have worked together to come up with a plan that would allow us to have a government that would work for Canadians, and that is a Liberal-NDP coalition. That coalition has a policy accord that is designed to address the present economic crisis. There has been a lot of misinformation. There is no secret deal. 

The deal is right here on the website. It is there for everyone to see. Not only is it on the website, it is very clear and plain what the arrangements are. The arrangements with the Bloc Québécois is that it will not defeat an NDP-Liberal coalition for a period of 18 months. What we have is a promise of stability for 18 months. The government cannot deliver that. Conservatives could not deliver stability for two or three weeks in Parliament. What prospect does the government have to continue for the next 18 or 28 months, or even the next three months? None. The instability is coming from the government and from the failure of the Prime Minister to show the kind of leadership that is required. There is a lot of talk about working with other parties in the House and trying to vilify the Bloc Québécois, in the course of which creates a very divisive country. It has been said by Harold Wilson that: "Patriotism was the last refuge of the scoundrel". I am not calling anyone in particular a scoundrel and it may or may not be unparliamentary, but the tactics being used by the government and the Prime Minister in trying to save his own neck are very divisive. I hope...   

The Speaker: The hon. Minister of Justice is rising on a point of order.

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AbitibiBowater hydro assets

Undoubtedly, there will be plenty of hype and posturing about the hydro-electric assets in which AbitibiBowater has an interest. 

There's already been plenty of silly talk about "repatriating" assets.  Had successive governments not interfered in the operation of the mill it might have been re-organized and saved.  As it is, the closure of this mill is a mess created by all the players.  None can escape responsibility.

Expect NL Hydro to purchase these assets from the private sector partners, one of which is Fortis, with the power being sold to Vale Inco.

In any event, here is a brief description of the assets. 

1.  Exploits River Hydro Partnership.  Partnership between Central Newfoundland Energy - a Fortis subsidiary - and AbitibiBowater. 30 megawatts.  Initial operational capacity (IOC): November 2003.  Supplied power to AbitibiBowater operation at Grand Falls-Windsor with surplus power sold to Newfoundland and Labrador Hydro under a long-term power purchase agreement.

2. Star Lake Hydro Partnership.  Partnership between CHI Canada Limited and AbitibiBowater. 18 megawatts. IOC: October 1998.  Star Lake displaces oil-fired generation at NL Hydro's Holyrood plant.

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Try the captain next time

Maybe Janice Wells should have tried a bit of Captain Morgan or Lamb's next time she wants to write a book on a subject other than gardening.

Clearly gin and tonic isn't cutting it.

No.  There's no evidence at all Frank Moores was involved in the Airbus deal.

Not even a fax in his own handwriting documenting the schedule of commissions for the sale.

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Business as usual

1.  AbitibiBowater to shut GFW mill.

2.  Vale Inco to close Voisey's Bay for one month in 2009.

Yep.

No one saw this coming at all.

Well, not anyone providing consulting advice to the provincial finance department and cabinet, apparently.

Gotta watch out we don't overheat the economy, too.

Apparently it takes a while for news to reach some quarters.

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Cluck, cluck moo: Byward version

Among the funniest comments coming from Ottawa these days was an e-mail reporting the streets around Parliament Hill are blocked with chicken feathers these days.

So many chickens are coming home to roost that their shedding feathers are causing a driving hazard.  People are having difficulty walking and Ottawa Carlton municipal workers are putting in overtime trying to free up enough space for people to get around.

There are also reports of tar on back order at local Home Depot outlets and the price for rails is climbing on a shortened supply.  Some people are apparently planning to take advantage of the feather supply.

The latest chicken to head home wore a wet suit and jet skied up the Rideau Canal.

Stockwell Day's people worked on a secret deal with Bloc in 2000 in case the election returned a minority parliament.  Day denies knowing about the deal.  Others might be seeing nuggets and dipping sauce since Day's defence emphasizes "signing" a deal with separatists. 

That kind of feather-splitting should make anyone skeptical.  Then when you find out Stock had a loose definition of "bad" back then - much like Loyola Hearn - you pretty much know Stock is running scared.  Scared of losing the car and driver, the expense account and the trappings of power.

The lust for power runs deep among the Blue crowd.  It will likely take hundreds of thousands of dollars to get their claw marks out of the desks, door jabs and banisters as they get dragged from their offices next Monday.

CBC dug into the files as part of the televised version of the Stockwell Day story.  They found a 1996 article by some guy named Harper and his best pal Tom Flanagan wherein the newbie member of parliament and his future political staffer mused about cutting a deal with separatists as a way of ousting the Liberals.

If they get punted to the opposition curb next week in a confidence vote, we can only wonder what will happen when the cows come home.  That bovine history,  full of stuff like Cadman and all its implications of potential criminal activity, could well make getting covered in tar and feathers and run out of town on rail look like an afternoon strolling the Byward.

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Vale cuts staff, production globally

1.  Globe and Mail reports Vale Inco will be cutting output at Sudbury.

2.  Globally, the situation is significant:

Dec. 3 (Bloomberg) -- Cia. Vale do Rio Doce, the world’s biggest iron-ore producer, fired 1,300 employees and will send 5,500 more on paid leave because of the “serious crisis” in the metals and mining industry.

An additional 1,200 employees are being retrained for new jobs, a press official for the Rio de Janeiro-based company said today in a telephone interview. Before the cuts, Vale had 62,000 employees worldwide, said the official, who declined to give her name.

3.  Nickel prices have dropped astronomically from $22 a pound (May 2007) to less than $5 currently.  It's hard to imagine that this would not have a serious adverse effect on provincial government revenues both in the current fiscal year and the coming one.

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Hearn on BQ: "There are some really fine people in the Bloc."

The Bond Papers Wayback Machine is a useful thing.

Well, useful for people like your humble e-scribbler.

Not so useful for the people - like Conservatives - who hope people have really poor memories.

Former federal fish minister Loyola Hearn turned up on local radio today talking about the evils of cuddling up to the Bloc Quebecois. Hearn has grave concerns.  The country might break up.

You will recall Hearn as one of the architects behind the merger that created the Conservative Party and put Stephen Harper in the Prime Minister's Office.

Not surprising then that he is telling us all how nasty those separatists are and how dangerous it is to get in bed with them.

So nasty in fact that back in 2004 when the Conservatives tried a group grope with Gilles Duceppe and his colleagues, the Blockies balked but Loyola kept trying to keep the flames of minority coalition passion alive.

No "one foot on the floor" thing for Loyola:

“I have no problem with the fact they are there to look after Quebec, I’m there to look after Newfoundland, and the six other MPs also, and if we’re not we shouldn’t be there,” Hearn told The Sunday Independent. [Full text below]

...

"There are some really fine people in the Bloc, you know," says Hearn. "Probably more so than any other party … quality individuals."

When asked about Quebec’s ongoing contention that Labrador is part of Quebec and not Newfoundland, Hearn says it’s a claim that sounds strangely familiar.

“It’s no more than us disputing the nose and tail of the Grand Banks.”

...

“We should take a lesson from the Bloc in dedicated support for your province. However, if the screw tightens where you’re looking to put forward your separatist views, then government can’t give into those wishes,” says Hearn.

Yes, even the sacrosanct Labrador border would not stand in the way of the Conservative march to power in 2004 using every possible means, including trying to avoid having an election.

It's time like this when immortal words about Conservatives come to mind:

They have to lie — the truth isn’t their friend right now. Get angry. Mock them mercilessly; they’ve earned it. ...You could eat their lunch, make them cry and tell their mamas about it and God himself would call it restrained. There are times when you are simply required to be impolite. There are times when condescension is called for!

There are times when condescension and mockery are called for.

Loyola proves it.

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Conservatives on the Bloc

By Jeff Ducharme (St. John's)
The Independent
Sunday, July 04, 2004
 
Bloc Quebecois leader Gilles Duceppe may have already put the kibosh 
on a coalition with the Conservatives, but St. John’s South MP Loyola 
Hearn says it could work.
 
"I have no problem with the fact they are there to look after Quebec, 
I’m there to look after Newfoundland, and the six other MPs also, and 
if we’re not we shouldn’t be there," Hearn told The Sunday Independent.
 
Hearn won a tightly contested battle for the federal riding of St. 
John’s South in the June 28th federal election. The incumbent Hearn 
beat Liberal challenger and political neophyte Siobhan Coady by a 
scant 1,500 votes in a race that came down to the wire. Hearn calls 
the battle the toughest of his long political career. 
 
Prime Minister Paul Martin barely maintained his grasp on power 
winning 135 seats compared to Conservative Leader Stephen Harper’s 99 
seats. If the Conservatives could cozy up to the Bloc and their 54 
seats, the two parties could control the House of Commons with a total 
of 153 votes between them. The Liberals and NDP could have a narrow 
advantage with a combined 154 seats. 
 
“We’ve indicated all along that we’re willing to work on an issue-by-
issue basis,” deputy Conservative leader Peter MacKay told CTV’s 
Question Period the day before voters went to the polls.
 
But the Conservatives may have a hard time forming any type of 
coalition with the Bloc. Duceppe and his party oppose the 
Conservative’s platform of scrapping the Kyoto Accord and its anti-
abortion stance.
 
“There are some really fine people in the Bloc, you know,” says 
Hearn. “Probably more so than any other party … quality individuals.”
 
Hearn credits Bloc MPs as being among the first to support his private 
member’s bill calling for custodial management of the Grand Banks. 
 
Natural Resources Minister John Efford found himself mired in a storm 
of criticism because he avoided the vote, saying if he had voted for 
the bill he would have been thrown out of cabinet.
 
“The earliest to come on board and some of the strongest supporters 
were people from the Bloc,” says Hearn.
 
When asked about Quebec’s ongoing contention that Labrador is part of 
Quebec and not Newfoundland, Hearn says it’s a claim that sounds 
strangely familiar.
 
“It’s no more than us disputing the nose and tail of the Grand Banks.”
 
Hearn says any coalition with the Bloc is touchy considering the 
anchor of the party’s platform is Quebec sovereignty and the erosion 
of Confederation.
 
“We should take a lesson from the Bloc in dedicated support for your 
province. However, if the screw tightens where you’re looking to put 
forward your separatist views, then government can’t give into those 
wishes,” says Hearn. 
 
If the Bloc and the Conservatives do find themselves in bed together 
when Parliament reconvenes, Hearn says it would likely be done on an 
issue-by-issue basis.
 
“We’re talking the same language — most of the time.”
 
 

Humber Valley Resort to go bankrupt

The company is blaming the provincial government.

They should be blaming someone else: Brian Dobbin.

When Dobbin took his leave, the company was in a financial mess -  insoluble mess - as it turns out. The wrong business model is the polite way someone described it.

Too bad.  The resort was a good idea.

Just that the execution sucked. 

Newfoundland and Labrador isn't a barren place to grow new ideas or significant industry, as Dobbin tried to whine when the Indey folded for the second time.

It's a barren place for piss-poor management;  the financial record on the resort speaks for itself.

And by the by, this makes Dobbin  - at the very least  - oh for two.

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