22 January 2009

Lacking Ig-magination in shadow cabinet making

The guy from Nova Scotia gets the oil and gas portfolio, even though his province doesn’t produce a gigantic slice of the country’s light, sweet crude.

The guy from the province that does, gets fish.

Again.

Go figure.

For a recycled idea, the only thing fitting is a recycled critique:

But for far too long, Newfoundland and Labrador has been politically regarded as the home of fish and whine.

Count up the number of times fisheries and oceans in any party has gone to a Newfoundlander since 1949 either as minister or as an opposition critic. You'll quickly get the point.

Second, there is an even greater conflict created by putting in charge of fisheries (or acting as the critic) any politician from a province where the fishery is less a business than a Frankenstein exercise in social engineering.

The tinfoil hat brigade, the anti-Confederate sasquatch hunters will leap forward to blame the evil machinations of "Ottawa" for the plight of the local industry.  The sad reality is that the current mess is entirely the construction of the political, social and business interests of Newfoundland and Labrador, over successive generations, who have forestalled, undermined and otherwise opposed any real and positive reform.

In Newfoundland and Labrador, the fishery is a cult.  As with any cult, it has its high priests who will rush to the temple altar - in this case the local open line shows and fisheries broadcast - to declare any reformer as a traitor, as a heretic.  It is an inbred cult where satisfaction comes from shagging your own.  Onlookers are distracted from the spectacle by the claim that outsiders have covetous designs on the defiled or that foreigners need to be driven from what is left of the sanctuary.

Now don’t misunderstand.

Gerry’s a fine enough fellow even if – in his asinine crusade against Marine Atlantic – he forgets that this province is already connected to the rest of the country via a land link.   Hint:  Ask Todd about this mysterious place called Labrador.

Once again, we can only be underwhelmed by the potential for change represented by the Liberal’s latest shadow cabinet.

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The fault, dear Wade…

Wade Locke doesn’t like a story in the Thursday Telegram. He dislikes it so much he called a local radio talk show to set the record straight.

Locke didn’t accuse the reporter of misquoting him in exactly those words, but he did end the conversation with the radio host by suggesting that maybe his comments were deliberately misrepresented.

Locke said something along the lines that he couldn’t imagine anyone reading the comments and coming to the conclusion he was suggesting the economy might be headed for disaster.

Locke went out of his way in the Open Line call to repeat phrases along the lines of “the future is bright” and “the future is rosy.”

The root of the issue is in comments Locke made for a news release from the Atlantic Provinces Economic Council. The headline on the story by Peter Walsh reads “N.L. economy facing disaster: experts”. The rest of the story summaries the comments from Locke and fellow economist Scott Lynch.

Here’s exactly what APEC attributed to Locke before getting into the specific suggestions Locke and Lynch had for the federal government’s budget:

Depressed commodity prices continuing throughout the year and longer would have a disastrous impact for Newfoundland and Labrador from a fiscal perspective and for the continuation and expansion of major resource projects within the province. A continuation of the existing tight credit market conditions will adversely impact small export firms and fishing enterprises and will be felt disproportionately in rural parts of the province.

If the U.S. economy continues to lose jobs as it did last quarter, then real GDP would decrease by 5% on an annual basis, which would produce a significant deep and prolonged recession. Forecasts of U.S. growth at -2.5 to -3% with recovery in late 2009 assumes that the Obama stimulus package removes deflationary expectations and returns the economy to its trend growth rate. For this optimistic scenario (successful stimulus and late 2009 recovery) Canada could experience a 1 to 2.5% decrease in real GDP, with the earliest recovery in September/October.

However, should the U.S. recession reflect the 5% decline in real GDP then Canada, as a small open economy, will follow the U.S. and be faced with a significant period of rising unemployment and declining economic activity, with recovery occurring in 2010. If, on the other hand, the recession in the U.S. is closer to the pessimistic scenario, then this may produce a decoupling of the Canadian/U.S. trade relationship and in that case, predicting possible outcomes becomes very murky.

It’s hard to imagine anyone reading that and not coming to the conclusion the boys were suggesting there could be disaster out there.

In fact, that’s exactly what Locke said in the very first sentence:

Depressed commodity prices continuing throughout the year and longer would have a disastrous impact for Newfoundland and Labrador from a fiscal perspective and for the continuation and expansion of major resource projects within the province.

Locke’s problem likely isn’t with the Telegram, Peter Walsh – who wrote the story – or indeed with APEC.

Rather his problem is that his APEC stuff wasn’t on the same page as the line being pumped by Locke and the provincial government before Christmas. The government crew have been in lock-step with one of their favourite outside consultants on this economic bubble thingy since the get go.

They were matching up word-for-word before Christmas and Locke this morning and the APEC suggestions sounded almost like a replay of what the Premier delivered to the feds last week. [edited to clean up the sentence jumble; link added to Premier's comments.]

Number One thingy: reform employment insurance to give people more money for longer.

Number Two thingy: Build ships and dole out the money so Newfoundland shipyards can get the work.

Number Three thingy: Lower Churchill. Never mind that the thing is shaky, let’s get people out there cutting brush and doing stuff of some possible, theoretical kind.

The odd thing is that Locke’s APEC assessment is actually closer to the truth than anything else. If commodity prices stay down for the rest of this year, into next year and maybe a few years after that, then there will be disaster.

But it won’t be a disaster necessarily for Newfoundland and Labrador, as in the province. It will be a disaster for Newfoundland and Labrador, the provincial government.

There’s a difference even if some people tend to forget that in these “l’etat c’est moi” days. That’s not to say there won’t be problems in some sectors of the local economy. Tight credit is going to force the fishing industry to sort itself out once and for all. Lower prices for minerals will mean that mines will shut down for periods and lay people off.

And let’s not forget that a slow down in Alberta will mean that remittance workers will either roost here and agitate for government help or leave altogether, permanently.

But still, there are mines that will be working away. There’s a new project coming for Long Harbour and the oil industry will continue to do very well, despite lower prices and reduced production. After 2009, production will pick up again. If we look farther out, then Hebron will come along.

The disaster Locke noted in his very first sentence for APEC (unless APEC misquoted him terribly) is really one for the provincial government’s treasury. Their disaster is entirely self-made. They boosted spending based solely on highly unreliable commodity prices and foolish predictions of ever higher or constantly high prices. They did very little to pay down public debt (accumulated borrowings) or sock away money in a rainy day fund. The provincial government also committed to a raft of borrowing to support the oil plays.

That put the provincial finance minister looking at 2009 with a shortfall of over a billion dollars in cash and demands for higher spending. Downturns in the market put extra costs in there to cover pension shortfalls. The 21% wage increase promise looked great politically but it was way beyond the rate of inflation even in the headiest of commodity price days over the past couple of years.

That sounds pretty much like a disaster to anyone who cares to take a look at it either from an economic or public policy standpoint.

It’s hard to imagine anyone could look at that and not see the disaster waiting to happen. Now the disaster doesn’t have to happen if the government shifts its policy direction in a number of significant ways.

That would require people in power to look at the world as it is and take appropriate action. But if think we live in a bubble, you’d be almost guaranteed to head down the wrong track.

You’d keep smiling all the way to disaster.

And it would be your own fault.

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He lost on Jeopardy, baby

Coming in second on Jeopardy is nothing to be ashamed of, there buddy.

Good on you.

To mark the occasion, here’s an song written 20 years ago by Weird Al that seems to fit.

Offshore royalty audits “Behind, big time”: Dunderdale

In July 2006 when Danny Williams accused ExxonMobil of denying the provincial government access to the books for the Hibernia project there was a lot more to the story either than what he said or than just his fit of pique at the failure of talks to develop Hebron.

Williams put it in another context altogether at the time, claiming the company had reneged on a commitment to “audit process to validate statements by the company that the Hibernia project was not meeting the owners’ expectations.”

As it turns out, the reality – revealed almost three years later by the province’s auditor general in his annual report for 2007 (year ending 31 March 2008) -  is that the provincial government was and is behind in its own audits of offshore oils project reports:

… At October 2008 [sic], there were 87 annual royalty and eligible project cost submissions made by project
owners for which the Department has not started any audit work. No royalty or eligible project cost audits have been conducted on the Terra Nova or White Rose projects since production started in 2002 and 2005 respectively.

On top of that the department’s audit manual was approved in 2000 but hasn’t been updated in the intervening seven years.

reportchartAGThe auditor general also revealed that the department had quietly dropped its 2006 demand for access to the Hibernia books claiming they could adequately assess the issues without the company’s documents.

Each of the 15 companies operating offshore are required to file monthly and yearly operating reports with the provincial government.  They must also file an audited financial report annually on project costs.  All these are used to calculate royalties paid to the provincial government’s royalties and benefits division of the natural resources department.

The majority of the outstanding audits, shown in the chart at left taken from the auditor general’s report,  are for the period after 2003.

In early 2006  - the year Williams made his accusations against ExxonMobil and the year before the one audited by Noseworthy – then natural resources minister Ed Byrne told a House of Assembly committee that his department was experiencing staff problems in the division of his department responsible for the royalty and cost audits. 

MR. E. BYRNE: Difficult not only to attract, difficult to maintain. A lot of this, too, is part and parcel of the energy policy review that is ongoing and the dedicated resources we put to that. Within the Department of Natural Resources, the energy division is most challenged, more than any other division within the department, on not only recruiting but maintaining.

We had senior petroleum auditors who left for double the salary. We recently had an ADM who took a job in Calgary. I do not know what his salary was or what he was offered. He was making a competitive salary here, but it was a significant offer. Those are issues that the deputy and government struggle with everyday. Anyway, that is part and parcel of the change in direction there.

Within the local oil patch the migration of senior, experienced public servants to the private sector caused a great deal of chatter.

The problem hasn’t gone away.  Last May, natural resources minister Kathy Dunderdale told the House of Assembly’s Resources Committee that there had been a number of vacancies in the audit division and that the department was hiring outside contractors to take up the slack. She said the audits were “Behind, big time.”

The department’s deputy minister  - Chris Kieley - told the committee:

For those three projects [Hibernia, Terra Nova and White Rose], and with the increased activity, every year we are doing audits but, because of the turnover in staff, because of the resources that were assigned to that particular piece in previous years, the audits were behind; so, this past year and the year before we have made a particular effort to get those audits up to date and we have used outside assistance through auditing firms to help us do some of those audits. So, we have a combination now of outside accounting firms helping us get the audits up to date and we have our own staff working on the audits as well. We are working on a number of different audits now with all our projects at this point.

Kieley also insisted in May that

“[w]e are within the timelines prescribed by legislation (inaudible) the Hibernia royalty contract, but we are behind and we are putting extra effort into this whole piece to get caught up. When I say behind, we have not lost any ability to audit these. What we are saying is that we would like to get them up to a closer time frame.”

Auditor General John Noseworthy noted in his report that the Hibernia audits completed had revealed $8.66 million owed to the provincial government.  In her testimony to the resource committee, natural resources minister Kathy Dunderdale insisted, however,  that “there has been nothing earth-shattering that we have come across to this point.”  The completed audits done in May 2008 are almost identical to the ones listed as finished by the auditor general in his report.

Noseworthy also noted that the department had committed to completing all outstanding audits by 2010. At the same time, though noted that even the 2008 schedule was off, largely due to staffing problems within the natural resources department.

In 2008, the work plan was amended to move 2400 hours of work scheduled for White Rose to 2009 as a result of audit work done for Hebron.  As of October 2008 – half way through the fiscal year - an external contract for an auditor had not be let for 2008.

The 2008 audit plan was based on 1400 hours for four staff positions supposed to be filled by the start of the fiscal year.  By October 2008, one position was still vacant.  Another was filled in July and only two of the original four planned were in place in April 2008. Associate deputy minister Pierre Tobin gave the resource committee a different version at the committee hearings in May.  Rather than disclose that two audit positions were vacant, he left the committee with the impression the division was “almost fully staffed”:

That would be, in the past year, a number of auditors, but those positions have since been filled for the most part. There would also have been a couple of development officers and a couple of economists. We are almost fully staffed, particularly in the royalty audit section. We are down one person out of upwards to a dozen, I guess; we are doing really well there. [Emphasis added]

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20 January 2009

But will Charest expropriate?

Alcan closes a smelter and slashes production in the latest round of cuts and adjustments:

    • A further six per cent reduction in aluminium production, bringing the total reduction to approximately 11 per cent, and close to six per cent reduction in alumina production
    • Reduction in global workforce by approximately 1100 roles (300 contractors and 800 employee roles)
    • Substantial cost reduction programmes in Rio Tinto Alcan facilities worldwide
    • Permanent closure of Beauharnois smelter in Quebec, Canada
    • Production at Vaudreuil alumina refinery in Canada to be temporarily curtailed by 400,000 tonnes
    • Expected sale of interest in Alcan Ningxia joint venture in China
    • As previously announced, the anticipated ending of smelting operations at Anglesey Aluminium joint venture in the United Kingdom in September 2009 when the current power contract expires. The impact on production and headcount is included in these figures.

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Euphonium!

In the musical prelude at the inauguration, musicians would recognise the strains of Ralph Vaughan Williams English Folk Song Suite.

Seems a bit of an odd choice for an American ceremony until you realise the thing is full of beautiful euphonium lines.

WTF  you are undoubtedly thinking.  Who cares about that?

That starts to make more sense when you realise that the director of the United States Marine Band, “The President’s Own”, is the former principal euphonium player with the band.

We.

Are.

Everywhere.

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The voice of the cabinet minister

Heard on Tuesday January 20, the voice of a cabinet minister on the voice of the cabinet minister, saying:

We’re good at issuin’ releases.

Truer words were never spoken.

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Leading a Great City…

right into the ground.

The City of St. John’s became the object of national attention again, but not for a good reason with the attack on Tim Hortons. 

To make matters worse, Mayor Doc O’Keefe didn’t help make himself and the rest of council look smart when – a mere 24 hours after the attack started – he claimed that there was nothing new in the ban on drive throughs.

What a crock.

Now true to tradition, the crowd at Tammany at Gower cancelled the earlier attack motion – raised the white flag of defeat more like it – having discovered that there really isn’t much of a problem in the first place that isn’t being addressed already.

How many times did city council adopt a move and then vote the very next week to undo the move during the past 10 years?  Anyone recall the silliness about the supermarket by the lake project.

It’s on.

Nope.

It’s off.

Hang on.

It’s on again.

Sheesh.

And it isn’t just Doc.

It’s the whole crowd – Hann, Ellsworth, Coombs, Puddister to name just four – who either carry on with silliness of their own or enable the goofier ones like Doc.

A pox on all their houses come the fall.

They will all likely face some serious challenges for their seats.

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19 January 2009

Freedom From Information: faulty reasoning further limits accountability

In his most recent decision, information and privacy commissioner Ed Ring has struck a blow against government accountability.

He did so using faulty reasoning.

In April 2008, an unidentified individual requested the subject lines of all e-mails for seven people in the Executive Council for a two month period in early 2007 (March and April) and the subject lines of e-mails exchanged between an unidentified person and a communications director in government over a 12 month period in 2005.

The positions covered by the request were:

  • Chief of Staff in the Premier’s Office
  • Director of Communications in the Premier’s Office
  • Principal Assistant to the Premier
  • Deputy Chief of Staff in the Premier’s Office
  • Director of Operations in the Premier’s Office
  • Press Secretary to the Premier
  • Director of Strategic Communications, Planning and Priorities (Executive Council), and the
  • Premier

The information commissioner ruled the Executive Council did not have to respond to the request since the amount of time taken to process the request would represent an unreasonable interference in the operations of the Premier’s Office. He estimated the time involved would be eight months, assuming that 500 e-mails per day could be read and redacted in accordance with the open records laws.

The specific section of the access law the commissioner cited is an interesting one:

10. (1) Where the requested information is in electronic form in the custody or under the control of a public body, the head of the public body shall produce a record for the applicant where

(a) it can be produced using the normal computer hardware and software and technical expertise of the public body; and

(b) producing it would not interfere unreasonably with the operations of the public body.

As part of the review process, Ring asked the central computer support office of the provincial government to generate an estimate of the number of e-mails which might – possibly  - be involved.  He uses the number that resulted as the basis for his argument that the request constituted the unreasonable interference in regular operations.

That’s where the problems start.

The e-mail system used by government is readily searchable using a number of search parameters, including date, sender and recipient. Thus a specific set of information to deal with this requested was readily available using existing software, as required by the access act.

Inexplicably, Ring did not ask for a count of the actual number of e-mail subject headings involved in the specific request.  That is the actual subject of the decision.

He did not ask even ask for the number of e-mails involved in the specific request.  That’s a bit of a stretch anyway since the request asked for subject lines, not the actual e-mails themselves.  Still, even that number was knowable since, as Ring decided, the original request was specific enough to meet the requirements under the law.

Instead, he asked the department to justify its estimate.  He allowed the Executive Council to set up a seven day period selected by some arbitrary criteria.  The reasons for taking this approach, what week was chosen and why aren’t disclosed.  Ring then extrapolates all his subsequent numbers from that one week figure.

As Ring ought to be aware, the entire government bureaucracy searched more records for more people over a longer period in response to the Cameron Inquiry.  They did so in the same time frame or in less time than the eight months Ring estimated for this request. 

While the inquiry was different, the volume of work – which Ring uses as the entire justification for his decision – is greater for the inquiry.  This request is also considerably less complicated than the previous information co-ordinator’s decision which Ring also cites.

This request asked only for subject lines which, contrary to his assertion, would not in itself require an individual to read the entire e-mail in each case to determine what ought to be redacted.

In short, there is no technical reason why the information could not have been collected and supplied, even in general form to Ring so that he could make a specific decision about a specific request.

Turning a specific request into a theoretical abstraction seems on the face of it to be an effort designed to frustrate the release of information.

Ring discusses at some length the possibility that the request could have been and might still be addressed if the applicant amended the request to break it down into smaller bites.  There are a couple of problems with this, as well.

First, there was nothing to stop the department from beginning the process of releasing records based on the original request and doing so in the small bites suggested by both Ring and, apparently, the department’s access co-ordinator. 

Asking to amend the request or to be “more specific” is odd.  An applicant experienced with the way the provincial government handles access requests might well be suspicious that the efforts to change the request were illegitimate efforts to withhold information or to determine why the information was being requested.

Second, the department’s initial refusal to respond (or initial request for amendment to the request) was based on an overly narrow reading of the legislation.  Most requestors are seeking information, not the creation of a “gotcha” situation on an abstract technicality. 

Third, Ring had at his disposal several issues which suggests that the willingness to deal with this request may not have been as sincere as it first appears.

As Ring notes:

An Investigator from this Office initially asked for this information by e-mail dated 14 October 2008. Several follow-up communications were made to the Departmental Coordinator, asking when and if the information was forthcoming. The Coordinator could offer no response to these inquiries; she was not aware when the information would be provided to this Office or what the reason was for the delay. The requested information was finally received by this Office on 17 December 2008.

Take note of the line that the access co-ordinator could offer no response to the information commissioner’s inquiries, could not say when the information might be provided or provide any reason for the delay.

If that wasn’t bad enough, Ring had in front of him the infamous case of purple files already discussed publicly by The Telegram.  In that case, the department responded falsely to a request claiming it had “no responsive records” on “purple files”.  This was false since The Telegram had an e-mail in its possession – a responsive record under the law – that made specific reference to preparing a purple file. The newspaper filed an appeal of that response with Ring almost a year ago.

The sort of request made in this case isn’t unusual, especially in the modern day when more and more important records exist electronically.  The Department of National Defence, for example, has been dealing with them for years.  Their response is not to deny access or to try to alter the request, but to provide the information.  Here’s an example from December 2008:

All communications created from 1 January 2008 to 28 May 2008, between the Access to Information Act Coordinator and the head of the Tiger Team vetting ATIA requests, including memos, e-mails, letters, minutes of meetings.

That’s a request that’s as big or bigger than the one involved here and it got an answer.

The trend toward increased government secrecy is all around.  In the last session of the House, the government party passed amendments to the information management law.  Those purposely changed the term “public record” to “government record”, which in itself suggests that the government records are not public. There was no obvious reason for the change of words.

More to the point, however, the amendments create an environment in which more public records are captured under the definition of cabinet records than before and those records may be destroyed under the exception created for the Executive Council.  The go nicely with a nonsense section (section 6) inserted in the original access law that provides that other laws restricting access may over-ride the access law.

One cannot access records which do not exist and even the knowledge of such missing records can be withheld if one applies the correct amount of massaging to the letter of the law. That massaging just got a whole lot easier thanks to the latest decision by the information commissioner.

Of course, no one even remotely familiar with recent history will miss the point that part of the request sought records from 2005, the year the problems at Eastern Health first came to public light.  Do those e-mails still exist, aside from the ones already disclosed to Cameron Inquiry?  It’s a question that bears answering in light of government efforts to frustrate disclosure.

What of the other period, March and April 2007?  That too is a rather sensitive period in light of evidence at Cameron, if nothing else.

Whoever made this request ought to take up the appeal to the Supreme Court’s trial division, as provided under the access law. The access law is designed to facilitate the release of information. Increasingly, though, Executive Council is interpreting the law in such a way as to justify withholding information. Ring’s decision winds up justifying withholding information without good reason. That’s a bad thing for people interested in accountability and access to public records.

The issues in this case are large enough to warrant an appeal to the courts.  Maybe some people would be willing to pass the hat to help defray the legal bills. 

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No tax cuts: Williams

Notice in this short clip that Premier Danny Williams makes the pitch for expanded employment insurance benefits instead of tax cuts. 

"They need the money now, they need to support their families now…"is the quote attributed to Williams but not in the clip.

Odd.

Unless the feds are planning to boost the amount of money paid out in benefits as a percentage of former income or extend the period of benefits the people he is talking about – people tossed out of work due to the recession or, prematurely, due to hasty government action – will get the benefits.

It’s not like people will go without.

Of course, one of the biggest beneficiaries of a revamped EI system in Newfoundland and Labrador would be the remittance workers from the province who were working in Alberta but who are now finding themselves laid off due to the down turn in Fort MacMurray. They’d be bringing a hefty chunk of cash to Newfoundland and Labrador even though they are out of work and won’t likely find one at home.

Nothing better to reduce public frustration with government impotence on the economic development front in some areas of the province than a big cheque from Uncle Ottawa. 

It’s an old line, but a good one.

It’s just an odd one coming from the Premier of a “have” province.

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Stunner: “Liberal sources” not keen on election

Like who possibly might have seen this coming?

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18 January 2009

Money Talk

1.  From labradore, a post titled “Responsible Government”.

2.  From the Telegram, the editorial follows up on a story from the Saturday edition noting the difference between Jerome Kennedy’s take on the pensions business and that of his immediate predecessor.

It asks a question - So, why the huge difference between ministerial attitudes? – that is worth answering, or at least attempting to answer.

The difference has to do, in part, with the length of time in the job and the amount that one knows about the fundamentals of the job. 

Tom Marshall gave the answer any finance minister might give who understood his job and felt comfortable in the roll. 

The long-term effect of a drop in asset valuation is to force the government and maybe the unions to drop more cash into the fund.  As Marshall noted, over the long haul, the pension fund’s asset valuation has gone up and down yearly but has average over 10% growth since it was created in 1981 [See chart at left].

No big sweat in other words.

Jerome, on the other hand, left the impression huge mounds of cash might have to be dropped into the fund in the next “number of years”.

Big sweat, in other words, since most people would take the tone of his comments to mean more cash was needed in a hurry.

Kennedy’s shown this sort of thing before, this lack of understanding.  His answers to simple questions in the legislature last session – his first as finance minister – were overly aggressive, snarky and condescending.

What else is new, sez the wag in the gallery.  True, but look at the words and you get more the sense of a fellow who is anxious to make sure people don’t realize he doesn’t understand a lot of what he is talking about.

He is covering up, maybe temporarily, maybe as part of a pattern.

Another part of Kennedy’s interpretation versus Marshall’s has to do with the annual budget requirement to find some sort of theme for the farce known as “budget consultations.”  Last year it was a debt clock.  Tom Marshall talked a lot about dealing with the debt but in the end did virtually nothing about it all.  This year, Jerome didn’t have a lot of time to find something to use as a prop, as a theatrical device around which to frame all talk.

CBC’s piece gave him that prop, albeit at the last minute. 

A prop really isn’t necessary though, if any of Friday’s session in St. John’s is the guide.  The Board of Trade – predictably – called for tax cuts for businesses as the way to help get through the coming tough times.  otherwise, government should stay the course.

What that means exactly is unclear, since the current crowd have been spending like there’s no tomorrow and no paying down the public debt to any appreciable degree. Plus, as labradore notes, their entire debt pay-down thingy is merely designed to open up room for more public debt.  That hardly sounds like something the Board of Trade would endorse but yet it does.

The only thing more predictable than the always Tory Board of Trade was the Canadian Federation of Independent Business. Times are good:  cut taxes, says Bradley George.  Times are bad?  Cut taxes, says Bradley George.

Again, no concern for the drain on public resources represented by debt and the odds such debt would increase with all those tax cuts.  How will we pay for everything if we cut taxes and cut them again and then cut them thrice for good measure?

The shortcomings of both the Board and Bradley are evident since neither made any reference to the gigantic shortfall in revenues coming this year. They either do not know or care not to know about the billion or so that has to come from somewhere since it won’t be coming from oil and mining and forestry next year.  It is like the debt:  best ignored except to support action which does not occur.

The size of the “or so”part of that equation by the way would be increased, inevitably, by the size of their tax cuts but this is all of no concern.  The only crowd equal in irresponsibility to the business bunch would be the labour and “social” bunch.  Where the business crowd seek to  cut revenue, the other would boost spending in just about every direction simultaneously. 

The current administration enjoys the support of both business and labour, it should be noted. 

Of course, none of this consultation has to make sense, nor must it bear any resemblance to what is actually going on in the world. The purpose of the consultation farce is merely to allow everyone to recite their scripted lines and if it can be held at the hotel owned by a loyal supporter of the government, all the better.

The whole thing is like the annual Christmas pantomime in grade school.   Everyone must memorise the lines and say them, even if they do make sense only in the fantasy world of the moment.

There’s no requirement that the participants in the entertainment actually understanding what they are talking about either.

That, of course, is both painfully obvious and the answer the Telegram’s question.

 

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17 January 2009

Verbal Tic (2)

Who:  Bob Cadigan, president and chief executive officer of NOIA, the association representing oil and gas supply and service companies. [CBC ram audio file]

When:  January 14, 2009.

Interview:  With CBC radio’s Jeff Gilhooley about Chevron’s decision to defer drilling in the Orphan Basin.

Score:  19 “you knows” in a 4:00 minute interview, with the bulk occurring in the front end.

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16 January 2009

Simmonds nabs plea deal for Byrne

Former natural resources minister Ed Byrne pleaded guilty to two of the charges against him resulting from the House of Assembly spending scandal.

He pleaded guilty to a count of fraud and another to a count of fraud against the government. 

The Crown dropped other charges as part of a plea agreement worked out with Bryne through his lawyer, Robert Simmonds, Q.C.

Simmonds’ media scrum outside court is available here in ram format.

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Rumpole and the Heavy Heart

Sir John Mortimer, creator of Horace Rumpole, passed away on Friday, aged 85.

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Gov pension fund drops $1.6 billion in asset value in 2008

image

The provincial government pooled pension fund saw its asset value drop by $1.6 billion in calendar 2008, dropping to $5.1 billion on 31 December 2008 compared to $6.7 billion at year-end 1007, according to CBC Here and Now.

Public sector pensions are not in danger of imminent collapse but the story does illustrate the impact the global economic crisis is having on government’s financial position.

The table at left  - taken from the pension fund committee’s most recent annual report (August 2008) shows the annual rate of growth for the funds investments.  The average since the fund was created in 1981 is 10.8%.

The fund manages a varied portfolio of assets, including real estate through a corporation called Newvest.

440 egThe asset list, as of the end of 2007, is given in the annual report’s financial statements.

The mortgaged properties include:

Busy Work (3)

Newfoundland Hardwoods is a Crown Corporation established in 1950 to manufacture liquid asphalt and sell chemically treated poles and lumber to meet local needs.

The corporation was privatized in 1995  - that is the assets were sold off - but a board of directors was retained to deal with issues arising from the sale of its assets. The directors are all senior public servants in the innovation department.

Those issues have all been addressed save for one storage tank which has been sealed since there is no means of disposing of the contents within the province. The tank is inspected regularly.

In 2008, the directors issued a six page activity plan for the corporation for the period 2008-2011.

Newfoundland Hardwoods – the corporation with nothing else to do but keep an eye on a lone tank of chemical sludge somewhere in the province – is committed to supporting the innovation department’s mission to “foster regional  and provincial prosperity.”

It will do that by - you guessed it – keeping an eye on the sludge tank.

You could not make this stuff up if you tried.

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Busy work (2)

Newfoundland and Labrador Farm Products Corporation is the Crown agency that used to run the chicken processing plant at Pleasantville.

The plant was sold in the late 1990s and Farm Products Corp has had nothing to do since then.

The corporation still exists, however, and cabinet appointed a board of directors for the corporation. 

In March 2008, those directors - all public servants - dutifully filed an activity plan as required under the government’s accountability and transparency legislation.

The activity plan reported that the corporation was inactive.

The plan also reported the inactivity would continue.

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14 January 2009

Two iconic 1960s actors pass away

Ricardo Montalban, known to most English-speaking fans as either Mr. Rorke from Fantasy Island or as Khan, the villain from the second Star Trek film died Wednesday at age 88.

 

 

 

Patrick McGoohan, the brain behind the legendary television series The Prisoner – and its star as “Number 6” - died at his home in California on Tuesday, aged 80.

 

 

 

 

 

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A bit late for crying now

Some people – evidently including the governing Provincial Conservatives, the Liberal Opposition and the New Democrats  - thought it would be better to shut the paper mill in Grand Falls-Windsor than to have it open and employing people if there were fewer people working than there were in 2008.

That’s a choice they made.

Union members in the town acknowledged when they twice rejected any restructuring deals from the company that they knew what might happen if they voted down the proposals.

So why exactly would Lorraine Michael, the province’s lone New Democratic Party member in the House of Assembly, be disappointed that less than a month after voting to shut the mill, the provincial government doesn’t have anything better for workers than instructions on how to collect employment insurance or retrain for other jobs?

“We now have a substantial workforce in limbo, people who are understandably anxious about their futures and those of their families,” she said.

Sure they are, Lorraine. 

But they aren’t in limbo.

They are unemployed, or soon will be.  They need to start looking for new jobs.  They need to start thinking about retraining for other work and maybe consider leaving Grand falls-Windsor and the surrounding communities if there isn’t any other work for them.

Maybe Lorraine  - and every other highly paid legislator who voted to ram through the expropriation bill – should have taken a second to think about what they were doing.  Rather than cheering, they might have considered the consequences of their actions.

Just a thought:  maybe Lorraine could have asked to see the government’s plan before she gave them carte blanche to close the mill.

Former mill manager David Kerr put it this way recently:

"You know what's so sad about all of this? A nanosecond after CEO David Paterson was told about the legislated expropriation, let alone what he thinks of the Newfoundland government, he totally wrote off the mill - lock, stock and barrel. That's the way these guys think. If any door was ajar for negotiations to restart the mill (and it always is no matter what anyone says) it's now slammed shut, bolted and bricked up for good.

I don't know who's advising Premier Williams on this but they have to give their head a shake and go back to timing school. Timing is everything in this business and the time to expropriate was not now - good heavens while the mill is running give negotiations a chance. Expropriate on the last day a roll is dispatched on number three winder, not a second before.

"Also the union is insane. They are going around lauding Premier Williams for doing this great thing while at the same time trying to send a veiled olive branch to the company about getting back to the table. What are they smoking? The company reads newspapers, too. I bet Abitibi pulls the plug before March 28.

"Who in their wildest dreams thought this was the right thing to do now? This is a little like peeing in your pants in a snow storm. It feels good when you do it but wait a while and see."

Kerr made a similar comment on a Bond Papers post before Christmas, particularly in his sentiment that before expropriation there was at least a slim chance some agreement could have been reached. Your humble e-scribbler had written the mill off and – in this case like in a number of others – it would have been absolutely wonderful to be as wrong as Mr. Kerr said I was at the time.

Anyway…

Danny and Yvonne and Lorraine and all the others rammed through the expropriation bill without a second of hesitation and even less time for thought.

There’s a bit too much milk splattered over the floor to be crying about it now.

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