Freedom from Information: Nat Res Two-fer Thursday

The province’s natural resources department had rough day Thursday when it came to answering straight questions with straight answers.

As Dunderdale herself might say, the openness “piece” was missing, “big time.”

First, there was the bizarro refusal by a department spokesperson to discuss anything to do with the expropriation compensation process because there was an expropriation compensation process.

Then the Telegram had more on the recent trip by natural resources minister Kathy Dunderdale to Ottawa.  Readers will recall the minister – also the deputy minister – turned up in the gallery of the House of Commons this week.  She got a courtesy acknowledgement from the Speaker.

There’d been no public release that she would be in Ottawa so her sudden appearance raised a few eyebrows.

Dunderdale was attending a meeting of federal and provincial ministers responsible for agriculture. She ducked out of the obligatory team photo at the end claiming she had other meetings.

She did manage to find time to scoot to the Commons though.

Other than that, all her department spokesperson would say is that she “took the opportunity to meet with a number of federal ministers who were available while she was there on issues pertaining to Newfoundland and Labrador and that is the extent of it. She is not commenting further."

No further comment.

It’s becoming the departmental mantra.

Turns out – according to the Telegram’s Rob Antle – that Dunderdale met with federal natural resources minister Lisa Raitt and the province’s representative in the federal cabinet, Peter Mackay.

MacKay's communications director, Dan Dugas, confirmed that MacKay and Dunderdale discussed a variety of issues, including unemployment in central Newfoundland. The AbitibiBowater paper mill in Grand Falls-Windsor is expected to shutter within days, throwing hundreds out of work.

That “shuttering” turned out to be today, incidentally.

As the Telegram notes, Dunderdale’s mission to Ottawa comes shortly after the Premier’s latest Equalization tirade. Maybe they kept her trip quiet in order  to maintain the appearance that things are still tense between the feds and the province.  Maybe they kept their lips zipped at natural resources to avoid building up any expectations that Dunderdale might find some way to ease the tensions or even come up with the missing $400 million from the federal budget Dunderdale’s boss had been banking on.

All in all, the whole thing is a wee bit odd.

At least Dunderdale and her handlers learned a lesson.  When in Ottawa don’t take the minister to hang out in the visitor’s gallery of the Commons. 

Leave that job to the Premier’s personal emissary, a.k.a. Our Man in a Blue Line cab.

-srbp-

Expropriation bill companies report financial results

Two of the companies affected by the expropriation bill last December reported dramatic financial turn-arounds last year.

Manulife reported a loss of $1.8 billion in the last quarter of 2008. Sun Life Financial reported an earnings drop from $2.2 billion in 2007 to $783 million in 2008.

Both companies either had original interests or acquired interests from other companies in hydroelectric developments, laid out in Schedule E of the expropriation bill:

1. The "Acknowledgement and Consent Agreement (Water Use Authorization)" dated 24 April 1997 between the Star Lake Hydro Partnership, the Mutual Life Assurance Company of Canada ; and the Crown, and all amendments including the Supplementary Acknowledgement - Crown Water Use Authorization dated 9 May 2001 and assignments of them.

2. The "Acknowledgement and Consent Agreement (Crown Water Power Licence)" dated 24 April 1997 between the Star Lake Hydro Partnership, the Mutual Life Assurance Company of Canada ; and the Crown, and all amendments including the Supplementary Acknowledgement - Crown Water Power License dated 9 May 2001 and assignments of it.

3. The "Hydro Consent and Acknowledgement Agreement" dated 31 July 2002 between the Exploits River Hydro Partnership, Clarica Life Insurance Company, and Newfoundland and Labrador Hydro and assignments of it.

4. The "Agreement for the Purchase and Sale of Power and Energy" dated 18 September 2001 between Abitibi-Consolidated Inc. and Newfoundland and Labrador Hydro, and all amendments, including the Assignment dated 31 July 2002 between Exploits River Hydro Partnership, Abitibi-Consolidated Inc. and Newfoundland and Labrador Hydro, and assignments of them.

5. The "Restated Agreement for Non-Utility Generated Power and Energy" dated 24 April 1997 between Abitibi-Price Inc. and Newfoundland and Labrador Hydro, and all amendments, including the Assignment dated 24 April 1997 between the Star Lake Hydro Partnership, Abitibi-Price Inc. and Newfoundland and Labrador Hydro, and assignments of them.

6. The "Acknowledgement and Consent Agreement" dated 25 April 1997 between the Star Lake Hydro Partnership, the Mutual Life Assurance Company of Canada ; and Newfoundland and Labrador Hydro, and all amendments and assignments of it.

7. The "Acknowledgement - Power Purchase Agreement" dated 24 April 1997 between the Mutual Life Assurance Company of Canada, in its own right and as agents for the Canada Life Assurance Company, the Maritime Life Assurance Company, Sun Life Assurance Company of Canada, the Standard Life Assurance Company and Industrial-Alliance Life Insurance Company, the Star Lake Hydro Partnership; and Newfoundland and Labrador Hydro, and all amendments and assignments of it.

-srbp-

Freedom from information: no comment on process because the process exists

On January 8, your humble e-scribbler sent an e-mail to the natural resources department seeking some clarification of issues related to the Abitibi expropriation in December.

One of the questions sought clarification of the expropriated hydro assets:

5.  The legislation is explicit in section 5 in that the water rights, land and assets of both Star Lake and Exploits River partnership are forfeit to the Crown. Section 7 voids all the agreements and licenses associated with those projects.

At the same time, the Premier indicated in the scrum outside the House that Fortis, for instance, would continue to "maintain ownership".

Those two things can't exist in the same space.  If the Crown has expropriated the assets of the projects, the former proponents can't still have ownership of those assets.

Are you able to clarify this for me: Who owns the expropriated assets - dams, generation equipment, transmission facilities etc?  A written statement is fine or if there is someone I could speak with, then I am at your disposal.

The response – received yesterday – was that the department would offer no comment beyond what was in the public domain already since compensation discussions are outstanding.

Nothing.

Zip.

Zilch.

So who is the government in compensation discussions with? went the reply.

No further comment beyond what is the public domain came the response.

Fascinating.

Confusion is preferable to information.

And…

Denying comment because of “outstanding” compensation talks isn’t comment – now we know there are outstanding talks – but actually telling the public if talks are underway, who is party to the talks and all the other stuff that logically flows from the fact that you just confirmed talks exist or are at least “outstanding” is comment…

and is therefore verboten.

Surely the parties to the talks know they are talking or going to talk.

So finding out that they are in talks wouldn’t come as a surprise to them nor would it materially affect the talks to say something even as ambiguous as “the companies subject to the expropriation” when asking who was talking or with whom talks were outstanding.

Surely the parties to the talks – whoever they might be – know the issues well enough such that clarifying the discrepancy noted in question five wouldn’t actually affect the compensation talks.  For instance, if Fortis, Sun Life and others actually still do own stuff supposedly expropriated – as the Premier himself said - then they wouldn’t be party to the compensation talks because there’d be nothing to compensate them for.

And just to give a sense of how straightforward the questions are, here are a couple of others the government won’t comment on because of the outstanding talks:

6.  Bill 75 does allow cabinet to enter into arrangements (permissions and licenses) for the use of the assets.  Has this taken place?  If yes, what are the arrangements, with whom etc, for what term etc?

7.  Under section 10(2), persons affected by the expropriation of Schedule C assets are entitled to compensation in  a manner determined by the LG in Council:

-  Has the provincial government received representation from any parties for compensation under this section?

-  If so, who are the parties?

-  Has the LG in C  determined a manner for compensating parties affected by the hydro expropriations?

Factual questions about the process can’t be answered because the process exists.

And a government that prides itself on being open, transparent and accountable prefers confusion to factual information about a major public issue.

You just can’t make this stuff up.

-srbp-

The notional national media

Go to the Globe and Mail website.

Try and find a story from the February 11 edition by Rheal Seguin on a supposed border flap between Quebec and Newfoundland and Labrador.

You’ll to look a bit.  For some reason a story that was prominent is now buried away on the “Others” page instead of on the national politics section where it was.

The story is bogus.  There is no border dispute.  The matter was settled in 1927 and the Romaine river hydro-electric project isn’t even close to the 1927 boundary.  This is another of those Sasquatch hunter things about the Labrador border:  people keep hunting because they know it’s there but the only “proof” turns out to be fiction.

That’s because the border controversy, like the Sasquatch, is made up.

And the story is one of the problems when you drop into Newfoundland and Labrador every once in a while rather than pay attention to what is going on here on a regular basis.

You wind up hunting Sasquatch instead of looking at the case of a real undefined border – this one in the Gulf of St. Lawrence – which is impeding exploration for and development of oil and gas resources.

Meanwhile over at the National Post, a editorial on the latest federal transfer racket contains an astonishing amount of stuff that is not true.

Now Mr. Williams and his government have calculated that switching to the new formula would be better for the coming fiscal year — netting Newfoundland’s treasury and extra $1.3-billion to $1.6-billion — so they want to switch. However, in January’s budget, federal Finance Minister Jim Flaherty eliminated that option.

Not so.

The amounts quoted were totals over three years, not one.

More importantly they are estimates.

The only figure that seems to be plausibly correct is about $400 million that won’t flow in 2009 but even that is based on:

1. Estimates. 
2. Projections based on current knowledge instead of the actual financial situation in February 2010 when Newfoundland and Labrador will chose which of two Equalization options it will pick for 2009.
3. A set of choices that wouldn’t have existed at all if the current provincial government in Newfoundland and Labrador had gotten its way at any point in the recent past.

The National Post editorialist didn’t stop with those untruths.  It went farther with other things it actually labelled as true when they aren’t:

It’s true Mr. Flaherty and the Harper government eliminated the switching option without first consulting their colleagues in the Williams government. It is also true that this policy change only affects Newfoundland, even though the province is not singled out by name. And it is true the Harper government is tired of Mr. Williams and the constant bashing they take from him, all of which could lead to the conclusion that this is what Mr. Williams claims — an act of vengeance aimed at him and his province.

1. It’s not really clear that the feds didn’t consult.  The provincial officials knew something was up in November last year.  What happened after that is a bit murky.
2. The policy change affects all provinces receiving Equalization and provinces like Newfoundland and Labrador that are still affected by the program.  Ontario and Quebec aren’t going to draw as much from the federal teat as they would have under the program from 2008.  That’s been covered in other conventional news media.  Heck.  The changes are being made expressly to limit the impact on the program of having Ontario now drawing Equalization.

Now that last part – about being tired of the tirades  - is probably true. It’s quite the stretch though to go from that to suggest that this was a policy designed to screw over one province when the facts – as previously reported – show something else.

The relationship between the current provincial administration and the federal government – irrespective of political stripe – is dysfunctional.  It got that way as the result of a lot of hard work after 2003.  The dysfunction may be deliberate or it may be an accidental by-product of old-fashioned political posturing. That part doesn’t matter.  The fact is the dysfunction exists.

It can only change if the people  - it takes two to tango - who are causing or contributing to the dysfunction change their behaviour.

That change isn’t helped by newspapers that are notionally national printing bogus information as if it were fact.

-srbp-

The dark side of local media celebrity

“The cost of celebrity” - the first of a four-parter at Geoff Meeker’s media watch blog.

Thank the stars or whatever that bloggers don’t fall into that category.

-srbp-

Trouble in Harper-ville

Two senior advisors set to leave the Harper PMO is not a good sign for the Conservative leader.

Even Don Martin is talking about it.

Meanwhile, the latest Strategic Counsel poll has the Liberals and Conservatives in a tie nationally. A Harris-Decima survey shows overwhelmingly strong support for the Liberal budget initiative of regular performance updates.

-srbp-

Brain drain

Eddy Campbell, acting president at Memorial University, is taking up the president’s job at University of New Brunswick.

UNB likes his unique blend of academic and administrative accomplishments.

Meanwhile, Memorial University is reportedly another three months away from starting its search for a new president.

Again.

No word on who will be replacing acting president Campbell as the acting acting president of Memorial University.

-srbp-

Dunderdale a peace envoy to Ottawa?

Deputy premier Kathy Dunderdale turned up in Ottawa on Monday.  As part of the usual courtesy, the Speaker of the House of Commons drew attention to her presence in the gallery of the Commons.

So what was she doing there?

There’s no news release on her trip.

No mention of it at all locally.

Given the manifest problems in the relations between the current administrations in Ottawa and St. John’s, this would be the perfect opportunity for such a senior minister to try and repair the relationship.

More to the immediate point,  she could try to deal pragmatically with the changes to the federal budget that supposedly will cost the provincial government $400 million in the current fiscal year.

What was Dunderdale up to?

-srbp-

Ontario Dippers made illegal donation to NL Dipper in 2003

Unless “Ontario NDP” is someone’s really odd name, the New Democratic Party in Ontario made a donation to a Labrador New Democrat’s re-election bid in 2003 in violation of the Ontario Election Finances Act.

The donation is recorded in election finance reports on the Newfoundland and Labrador provincial elections office website.

“Ontario NDP” of Toronto Ontario gave $750 to Randy Collins’ re-election bid in Labrador West.

But under s. 29 of the Ontario election finance law, no political party, riding association, candidate or leadership candidate registered under the act can make a contribution to a political party outside the province. The maximum fine  for a general offence under the act is $5,000.

Newfoundland and Labrador’s antiquated election finance laws permit contributions from outside the province, with no limits on the amounts that can be received.

Collins resigned his seat in 2007 and moved to Ontario after being named in the House of Assembly spending scandal. Collins will appear in a St. John’s court in May for a preliminary inquiry on charges of fraud over $5,000, uttering forged documents, fraud on the government and breach of trust by a public official.

-srbp-

Words matter: the Mike Duffy version

What Senator Mike Duffy said right before the words for which he was rightly criticised:

Honourable senators, I urge you to ignore the nattering nabobs of negativism on the East Coast, particularly the Premier of Newfoundland and Labrador, who, I believe, does not do Newfoundlanders and Labradorians any favours by the kind of personal attacks he has made over the last couple of years; nor by his remarks that paint Newfoundlanders, who are the among the most generous, caring and committed Canadians, as greedy and selfish. Those remarks are unworthy of the great people of Newfoundland and Labrador.

The price of Senator Duffy’s indiscretion in choosing metaphors is that what he would have wanted people to recall is the stuff they ignored.

-srbp-

The smear of schmeergelder

When former New Brunswick gas regulator David Nelson couldn’t impugn a think tank report that shows – as drivers know – that gas price regulations costs them more than the unregulated system, the only thing Nelson could offer up is the suggestion the think tank is on the take.

That’s as convincing as the defence offered by local licenses and permits minister of Kevin O’Brien who took issue with the AIMS report that drivers in Newfoundland and Labrador had shelled out $65 million extra due to gas price regulation.

O’Brien said the amount couldn’t be that high because the regulatory office only costs $500K a year and that is paid by the gas retailers. 

Yes.  A cabinet minister responsible in part for looking after consumers doesn’t understand that when they pay more than they should have, that’s a cost.

But anyway…

CBC gives way too much credit to Nelson’s smear. They add their own observations at the end of the piece:

Also, the Calgary petroleum consulting firm MJ Ervin reported in its 60-city national survey that five of the 10 lowest pump prices recorded in 2008 [not including taxes] were in New Brunswick or Nova Scotia. Halifax gas prices ranked fourth lowest in the country.

One tiny problem:

Pump prices include taxes.

Check those on the MJ Ervin study and you find the ten lowest prices are in western Canada and parts of Ontario.

-srbp-

Government to woods workers: you’re SOL

In December, the provincial government introduced a bill to expropriate Abitibi assets in the province.

The approach would work – said the government – since the legislature is sovereign.

What it says, goes.

But…

When it comes to a couple of hundred workers laid off this week, the government can’t help them get severance pay.

Innovation, Trade and Rural Development Minister Shawn Skinner said it's unfortunate that severance wasn't included in the woods workers' collective agreement, but the government can't force the company to pay beyond what's in the contract.

"From a government perspective, we will do whatever we can to assist them to make sure that they get whatever they are entitled to, to the full benefit of the laws of this province," he said.

Can’t force the company to pay?

Interesting idea that the existing laws on worker issues must stand as they are but seizing stuff government wants is another story.

The innovation added a penetrating insight into the obvious when workers suggested the severance be tied to compensation the government might pay Abitibi and other companies for the expropriation. "Our expropriation really had nothing to do with any contractual arrangements that the mill, and the owners of the mill, had with the employees," Skinner told CBC.

-srbp-

Innu land claims vote postponed

The Labradorian is reporting that the vote on the Innu land claims agreement originally scheduled for 31 January has been postponed indefinitely.

Innu Grand Chief Mark Nui and other officials of the Innu Nation are reported to be meeting with provincial government officials this week to deal with unspecified “outstanding issues.”

-srbp-

5 years and counting: still no sustainable development act

A 2003 Provincial Conservative election promise  - to ensure that economic development and the environment were in sync  - remains unfilled five years after the Provincial Conservatives took power and two years after the law was passed by the province’s legislature.

The province’s Sustainable Development Act, passed by the legislature in early 2007, has not been proclaimed and is therefore not law.

In the meantime, the provincial government’s energy corporation is proceeding with development of the Lower Churchill, including a plan to sling high-voltage power lines through a UNESCO World Heritage site.

That certainly wouldn’t be the popular impression since then-environment minister Clyde Jackman issued a news release in June 2007 that made it sound like the Act was in place:

The sustainable management of the province’s natural resources is now enshrined in the Sustainable Development Act that was passed in the current session of the House of Assembly. Sustainable development will ensure the province’s renewable and non-renewable resources are developed to maximize benefits for the province, while protecting the natural environment so that future generations have the ability to meet their own needs.

The release said more than half a million dollars had been set aside in 2007 to establish the advisory committee that is at the heart of the act.  No legislation, though meant no committee.

The unproclaimed act featured prominently in the Provincial Conservative Party’s 2007 election campaign platform.  The second blue print also made it sound as though the act was in force and work was underway:

Through our new Sustainable Development Act, we will ensure that development proceeds in harmony with our natural environment, securing our greatest natural strengths while promoting eco-friendly enterprise.

…

• enforce the provisions of the Sustainable Development Act regarding the responsible and sustainable development of our natural environment, ensuring that our resource development decisions address the full range of environmental, social and economic values and that workers, environmentalists, industry, communities, aboriginal peoples and others have a say in how our resources are managed. [Emphasis in original]

Without the sustainability act in place, there can be no enforcement of its provisions.

Without the act, there is also no Strategic Environmental Management Plan, even though the provincial government committed to have one in place by 2009.

The SEMP was supposed to be the document that put the commitment to environmentally sustainable economic development into action.

-srbp-

Uncommon tourism potential: A vision of hydro towers in a UNESCO World Heritage site

On Friday, the provincial government announced the creation of a new bureaucracy to promote tourism to the province, as if that was the answer to the dwindling return on investment from the current approach.

You can tell a lot about any plan by the way it proposes to measure success.  In this case, the new tourism strategy – Uncommon potential – wants to double the amount of money generated by tourism in the province.  Inflation would pretty much take care of hefty enough chunk of that in the next 11 years so whatever is left can be either explained away when the time comes or simply ignored.

You can tell this is a serious plan:  it has lots of pretty pictures in it, shop-worn jargon by the shovel-full  - “world-class” and “the possibilities are endless”, two great Chuck Fureyisms from his stint as tourism czar - but no indication of how much money it will cost to do all the things listed as the various action items.

One would have to read the release to appreciate, as well, that the strategy doesn’t really get at one of the current problems, namely the fact that more than half the $500 million generated by “tourism” right at the moment doesn’t come from people travelling into the place.  It comes from locals.

Odd, though, that there is no mention in this beautiful looking document of the tourism potential of high voltage direct current hydro-electric transmissions lines.  There’s lots about pristine wilderness, natural beauty, authentic experiences and a raft of other buzzwords but nothing about giant steel girders supporting buzzing electricity cables.

Odd, you see, because that’s exactly what the provincial government’s energy corporation is planning to string from Labrador down to the Avalon peninsula to meet a demand that can be met with other sources of power.

The energy company plans to run the lines, in one part at least, through Gros Morne National Park.  That would be the UNESCO world heritage site. Now there are already lines in the park that were installed long before the park was established in 1987. 

But you’d think that a company owned by the provincial government might be looking at ways of getting out of the park altogether rather than planning on increasing the power lines in a truly beautiful place.

-srbp-

Selective perception

The Telegram’s front page story on Friday reports on a study released by the Montreal Economic Institute that, according to the Telegram, shows that Hydro Quebec profits hugely from the Churchill Falls power development.

Shocking!

What’s actually much more interesting is what the study was about.

Amazingly enough, it wasn’t about how much money Hydro Quebec makes of Churchill Falls.

Rather, the Montreal Economic Institute study argued that Hydro Quebec should be privatised because it is wasteful and inefficient.

The title of the report – conveniently omitted from the Telegram story -  is one that would surely ignite even more gnashing of teeth in these parts than the amazing revelation about Churchill Falls:

“How would the privatization of Hydro-Quebec make Quebecers richer?”

The title on the news release is even better:

“Privatizing Hydro-Quebec would give $10 billion more a year to Quebecers”

By privatizing Hydro-Québec, Quebecers would get $10 billion more out of it per year through improved productivity, higher electricity rates and an end to costly subsidy programs for aluminum smelters, according to a Research Paper published by the Montreal Economic Institute. The new private company would be required to pay substantial annual royalties to the government, says the study, prepared by Claude Garcia, member of the board of directors of several corporations and former president of the Canadian operations of Standard Life.

Standard Life. 

Hmmm.

That would be one of the companies whose hydro-electric assets in Newfoundland and Labrador were nationalised by the the legislature last December.

The paper is far more provocative than the bit excerpted by the Telegram, especially in a province where the government is already committed to create in Newfoundland and Labrador a Crown corporation that is the mirror of Hydro-Quebec.

 

-srbp-

Verbal tics (4)

Who: Danny Williams

When: Saturday, February 7, 2009

Where: Interview with Kathleen Petty for CBC Radio’s The House.

Score: 23 “you knows” in six minutes and 30 seconds.

Well, you know, I think we understood here in Newfoundland and Labrador that, you know, once the Liberal Party had made up its mind that it was going to support the budget for its own, you know, national reasons,
you know, we accept that even though we'd prefer a different outcome, but it's really Newfoundlanders and Labradoreans, I think, as a group just standing on principle and making a statement to the rest of the nation that they disagree with what the Harper Conservatives have done to try and, you know, compromise us during this budget and make us pay for democratically electing Liberals and New Democrats.

-srbp-

“We want to be independent and self-sufficient”

Some views on Canada, Confederation, Newfoundland and Labrador and what it is all about, from the words of one man and his administration, sometimes within the very same interview.

1.   This land is my land!  Sort of.  Globe and Mail, February 7, 2009:

“…Separation is not something that is on my agenda under any circumstances.

This is a great country and I want to be part of it, but the country disappoints me when we don't rally to protect each other.” [Emphasis added]

Yet, what recently happened in the federal budget was not confined to the actions of one man or even one political party in a federal system:

“It should have been a legitimate celebration of coming out of the 'have not' status and being a net contributor to Canada. We're looking at that to be a very positive thing — and then Canada just struck us over the head.” [Emphasis added]

2.  Halifax, June 2001:  on the Great Plot that is Confederation…

“The more that I see, the more nauseous and angry that I get. The way that our people and our region have been treated by one arrogant federal Liberal government after another is disgusting. The legacy that the late Prime Minister Trudeau and Jean Chrétien will leave in Atlantic Canada is one of dependence on Mother Ottawa, which has been orchestrated for political motives for the sole purpose of maintaining power. No wonder the West is alienated and Québec has threatened separation. Canadians - and Atlantic Canadians, in particular - realize the importance of dignity and self-respect while Ottawa prefers that we negotiate from a position of weakness on our hands and knees….”

3.  On the goal, from the same speech:

We don't want handouts. We want our pride back. We want to be independent and self-sufficient.

4.  Eternal vigilance against the Foe:

We’re resilient, we’re survivors, ah, y’know, we basically prepared for this day. When, y’know, over the course of the last few years, you’ll notice from our Throne Speeches, we’ve talked about being self-reliant, we’ve talked about being masters of our own destiny. And we have been building up a war chest for when the feds come at us again, quite frankly.

5.  Throne Speech 2008:

As a result of our collective efforts to wrestle down the deficit, to ratchet up growth and to reach an agreement that fulfilled the promise of the Atlantic Accord, we are – for the first time in our history – poised to come off equalization very soon. This is a stunning achievement that will reinforce the bold new attitude of self-confidence that has taken hold among Newfoundlanders and Labradorians. [Emphasis in original]

The revenues that pushed the provincial treasury to “have” status came entirely from agreements signed before October 2003.

6.  On the current economic problems facing the province, Globe and Mail, February 2009:

Williams says the per capita loss is roughly six times that of Quebec or Nova Scotia. He also said his financial experts are predicting provincial revenues from dropping oil prices will be down some $1.5-billion.

"That's a double whammy," says Williams, that will "cripple" his province and force it back into deficit spending.

"We've done all the right things fiscally," he says, "and then in one fell swoop 'bang' we're pretty well back where we started."

The warnings against overspending  - that one from 2005 - from early on in the Williams administration went unheeded. The Premier had a decidedly different view of the province’s economic fortunes only a few months ago.  He wouldn’t talk hard numbers even though the ones the provincial government is currently using were pretty obvious to regular readers of these e-scribbles. All that’s happened in the past couple of months is a refining of the numbers, not a surprise shift to big ones.  $1.3 billion in November.  $1.5 billion now.  Works out to the same thing.

7.  The oldest living father of Confederation, reincarnated, Globe and Mail, February 2009:

Independence talk, he says, is once again being heard: "But that's not where I'm coming from. Separation is not something that is on my agenda under any circumstances.

"This is a great country and I want to be part of it, but the country disappoints me when we don't rally to protect each other.

Ditto, circa2007:

Premier Danny Williams says he's trying to quell separatist feelings within Newfoundland and Labrador, despite a throne speech that suggested the province should push for more autonomy from Ottawa.

"The fans of sovereignty are here. If anything, I've been trying to dampen those fires as much as I can," Williams said yesterday.

8. Autonomy!  Throne Speech 2007:

…our people have now also learned that we will achieve self-reliance economically only by taking charge of our future as a people. To that end, My Government will harness the desire among Newfoundlanders and Labradorians to cultivate greater cultural, financial and moral autonomy vis-à-vis Ottawa. [Emphasis added]

9.  What autonomy means, in greater detail,  Hansard, 24 April 2007:

Political self-reliance simply means that we cannot rely upon those elected to offices outside of this Province to deliver what is in our own best interest. We must achieve that on our own. Self-reliance will not come by depending on others to achieve it for us. That is a lesson we have learned year after year, generation after generation. So we will harness the desire among Newfoundlanders and Labradorians to cultivate greater political, financial and moral autonomy vis-a-vis Ottawa. As a distinct people and as equal partners, Aboriginal and non-Aboriginal together, we will write a new future for Newfoundland and Labrador; a future of our own design, where mutual understanding, justice, equality, fairness and co-operation are the order of the day. [Emphasis added]

10.  Foreshadowing.  If recent events are any indication federal politicians and those at the time who were wannabes clearly ignored that point, as Bond Papers warned at the time:

It should surely give pause to all those incumbents federal members of parliament from this province and those likely candidates for it means clearly that Danny Williams does not and will not trust you. These words mean, unequivocally, that elected representatives of the people of Newfoundland and Labrador are not to be trusted merely because they represent the people of the province somewhere other than in the House of Assembly controlled utterly by the current provincial administration.

Scott?  Walter?  Paul?  Peter?  Siobhan?  Fabian?  Gerry?  Loyola?

One wonders if they get the point.

11. And you want to be my latex salesman? Budget speech 2008:

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

-srbp-

The Hurt Locker: Monkey-tossing can’t work when people know the truth

Remember that right from the start Bond Papers pegged this latest Equalization flap as a way of pretending that whatever fiscal mess the government is in, the whole thing is really someone else’s fault.

Now for those who don’t know, monkey-tossing is one Danny Williams’ great political skills.  If they gave gold medals in tossing the monkey from his own back, Danny Williams would own them all.

He tried to toss responsibility his own failure in the Andy Wells/Max Ruelokke affray.  For those who are keeping score, incidentally, it’s worth taking a look at the judge’s decision in that case.  The number of times the provincial government changed its position  in the case rivals its multitude of contradictory stands on on Equalization.

He monkey-tossed the whole smelter in Long Harbour a couple of years ago, although hat one is still a wee bit odd.

Now it’s the whole $1.5 billion. 

Look at how the Premier puts the thing in a letter to the National Post on Saturday. 

Guaranteed by now the thing has been blasted over the plant internal comms system such that come Monday every single one will be talking  - on the open line shows and anywhere else plants turn up  - about the recent federal offset changes as if the impact comes entirely in one year:

Not in our most pessimistic moments did we dream that we would be negatively impacted to the tune of $1.5 billion — approximately one quarter of our annual provincial budget.

The thing is: that statement isn’t true.

The provincial budget was short for the coming fiscal year by $1.5 billion before anyone learned about the Equalization/offsets thingy.

The loss represented by the offset changes – even if we accepted the provincial government assumptions and projections -  would be a little over $400 million in 2009. That works out to be six per cent of the 2008 budget and, as we’ve said before, it’s not even a real number.  It’s entirely made up base don a raft of assumptions which might not turn out to be true.

What is true, as it turns out, is the Bond Papers prediction  over the past few months that the provincial government is facing a $1.5 billion shortfall on the annual budget.

That is about 25% of the upcoming budget.

The culprit?  Oil mostly:  down a billion next year over last year using an assumed value for oil in the mid—50s Canadian.  Incidentally, for all accounts that is exactly what the provincial government is currently using for their estimates.

The other culprits?

Well, you can hack off another few hundred million for the collapse of mineral prices.

Then, there’s the impact of tossing 1,000 highly paid paper workers to the curb.

On top of that there’s the 4,000 or so migrant labourers who were making Alberta money but now will have to subsist on the earnings from Lotto 10-42.  Notice that the downturn in the oil sands alone is having four times the job impact in Newfoundland as Abitibi.

That means fewer purchases and hence a drop in sales tax.  That means a sizeable chunk of income tax revenue will disappear.

By the time you add it all up, the provincial government is in the financial hurt locker:  expenses as big as 2008 – around $6.0 billion  - and the income from 2004 – somewhere around $4.5 billion.

No wonder the Premier is trying to toss that monkey off his back.

In 2004, he could toss the fiscal monkey onto the shoulders of the crowd who’d been in office.

He did.

He also tossed the cost of cuts onto the backs of the province’s public sector workers. 

The Premier could monkey-toss for England.

He does it all the time.

-srbp-

Verbal tics (3)

Who:  Danny Williams

When: February 3, 2009

Interview:  Scrum video.

Score:  55 “ya knows” in 16 minutes and 56 seconds. Does not includes coughs, “quite franklys”, “nothing could be further from the truth” or shoulder twitches.

-srbp-