Oil Royalty and Oil Price Forecasts (2015) #nlpoli

Don Mills says people in Newfoundland and Labrador have a false impression of the state of the provincial economy.

Wade Locke says Mills is full of it.

To bolster his argument, such as it is, Locke released a raft of pretty charts a couple of weeks ago.

One of them included a slide showing projected offshore oil production. (right)

Brain Farts #nlpoli

Some people have a hard time with the idea that a great many political decisions are not the product of deep thinking, extensive research, and agonizing debate.

They come from brain farts.

You can hear that pretty clearly in the most recent episode of On Point. The political panel talked about a couple of cock-ups by the Conservatives last week.

 In among the few nose-pullers the panel tossed out, the basic elements of the story were there.

Political Pandermonium #nlpoli

You can tell the election is already going on.  You can tell because of what some of the political workers are doing.

The Liberals are going door-to-door.  They are meeting voters.  They are asking for their votes.  Then the campaign workers write on Twitter and Facebook.about the “glorious day” of campaigning  they’d had.

Politicians tweet as well. The candidates tweet about their campaigning. The elected politicians tweet about the meeting they went to, or a government comment, or questions in the House of Assembly. 
Taking a lesson he learned from Reform Conservative turned Grit turned provincial Conservative Steve Kent, provincial Connie turned Grit Paul Lane goes places,  takes a picture of himself there, tweets it, and then frigs off somewhere else. The selfie makes it look like he stayed at the event.  That’s how he can be in so many places at the same time.

Lane also posts ridiculous pictures like this one about the May 24 weekend.  It’s a stock photograph of an Adirondack chair on a lake somewhere else in North America.

He used the same picture in a string of tweets over the weekend. People on Twitter made fun of Paul.  It looks like Lane had these pictures made as fridge magnets. Paul needs to decide if he has a moustache or not.

Owing it forward #nlpoli

The provincial government will balance its books this year by borrowing $2.1 billion.

Lots of people don’t know that,  as Michael Caine would say.

The government included in its budget plans this year a hike in the HST of two percent.

The tax hike will bring in $200 million.

That $200 million will just about cover the interest in one year on all the new debt the provincial government plans to add between now and 2021.

The $2.1 billion this year is the tip of a very big iceberg of new debt, you see. The new debt will go on top of the other $12 billion we already owe. The total cost just to pay the interest on that debt in 2021 will be $1.0 billion.

When people found out about the HST hike, they lost their minds.

Fast forward to 2017.

Never heard anyone say that before #nlpoli

“This may be our last shot at it,” said captain of industry Paul Antle this week as he set off to find other captains of industry to help him save the province. .

Gotta get off the oil, see. The Tories have frigged everything up..

Not so very long ago another rich guy-turned-politician said pretty much the same sort of thing.

The Liberals had cocked things up so badly – said captain of industry Danny Williams - that he was trying to get oil royalties that Ottawa was taking.

They weren’t really doing that, as Williams later admitted, but hey,  why let the facts get in the way of a good story.

“Williams provided [Macleans scribbler Paul Wells with] chapter and verse of his battle with Ottawa for a bigger share of the wealth generated by offshore oil. He passionately advanced the idea that this is his province's last, best hope to become a have rather than a perennial have-not.”  That was December 2004..

-srbp-

And it’s only Wednesday #nlpoli

Imagine, if you can, what it must be like to be Sandy Collins.  Sandy is a very young man who is -  right now -  living the first line of his epitaph.

Imagine, if you can do two at one,  what it must be like to be Veronica Hayden.  Veronica is Paul Davis’ principal assistant.

Both took to Twitter last weekend to harass Liberal leader Dwight Ball over the fact that he seemed to be saying contradictory things.

They must have been feeling very proud, strong, and determined.

And then it was Monday.

A Memorial at Gallipoli #nlpoli

The provincial government announced four years ago that a caribou memorial at Gallipoli would be part of the Honour 100 commemorations to make the 100th anniversary of the First World War.

For those who don’t know,  the Newfoundland regiment fought its first battles on the Turkish peninsula from September 1915 to January 1916.  Gallipoli is the only major battle site from the First World War that doesn’t have a caribou memorial.

That’s why the provincial government announcement in 2011 was such welcome news.

That’s also why it came as such a disappointing shock to so many people on Monday to learn that not only had the provincial government scrapped the memorial but that they had done so because they could not find $500,000 in the budget to cover the cost. That is precisely what odds and sods minister Darin King told the House.

When is a cut not a cut? #nlpoli

A couple of years ago, the province’s auditor general noted that a Crown agency responsible for developing an integrated health information system was paying salaries to its employees that were way outside provincial government guidelines.

The Telegram reported last fall that the problem was still unresolved 18 months after the auditor general issued his report. This was no small matter. Salaries grew 354% between 2007 and 2012, according to the Telegram. In one case, the salary for a senior executive member jumped by 119%.

Last week, and in the wake of an updated report by the province’s auditor general, Canadian Press reported that health minister Steve Kent had cut salaries at NLCHI. They’d save $50, 000 in one case and altogether the salary cuts would save $330,000.

Small problem.

Ethnic identity economics #nlpoli

Wade Locke and Don Mills are two of the faces most associated with the current Conservative administration in Newfoundland and Labrador, aside from the politicians, that is.

Mills played a key role in Danny Williams administration.  Mills polling firm provided government with quarterly surveys.  Williams also tried to manipulate Mills’ survey results for questions on local politics that Mills used to market his research company.

The quarterly polling was key to Williams efforts to silence dissent and maximize his own freedom of political action.  The more popular Williams became, the less likely were any opposition politicians or news media to question his decisions. 

And for everyone else, the Conservative message was that any dissidents were out of step with the majority of Newfoundlanders and Labradorians.  Mills’ polling purportedly showed that Williams and his party were popular to an unheard of degree.  “He’s right because he’s popular and he’s popular because he is right,”  was a common Conservative talking point.

That’s why it has been so interesting the past few months that Mills has been criticising the provincial Conservatives in Newfoundland and Labrador.

Trends: corpse kicking after a lost decade of delusion #nlpoli

Don Mills is the latest fan of the provincial Conservatives to turn on them savagely.

The St. John’s Board of Trade had Don back to deliver a luncheon speech this week.  According to CBC,  Mills said:

"The downside of Danny Williams, and I have a lot of respect for him, is that he doubled the provincial budget within that timeframe too," …  "He left the province with a structural budget problem that is going to be difficult to fix."

Mills also endorsed the private sector as the engine of economic growth, something Williams firmly opposed.

A decade ago, Mills couldn’t say enough about Williams the Wonderful.  Now,  Mills cannot distance himself enough from Old Twitchy and his legacy of what Mills calls “a structural budget problem.”

The Fourth Party #nlpoli

A Telegram editorial on Wednesday contained a curious comment.  

The subject was news that broke this week about the provincial government;s energy corporation.  Two senior corporate officials are refusing to testify in a court case in Quebec over contending interpretations of the 1969 power contract between Churchill Falls (Labrador) Corporation and Hydro-Quebec.

Nalcor is refusing to respond to the Quebec court’s order, insisting that the order must come from a court in this province.  Now the entire court case is extremely important because it is crucial to Nalcor’s entire scheme for Muskrat Falls.  The fact that Nalcor is thumbing its nose to a legal process that it is a party to, through its majority ownership of CFLCo is both troublesome and needlessly offensive.

But that’s not the curious point from the editorial.  Whoever wrote the commentary added this bit toward the end:

It’s possible they are simply mirroring the intransigence of their Quebec counterparts to co-operate with actions in this province — as, for example, Hydro-Québec did in refusing to participate in PUB hearings on the water management agreement.

The problem with the statement is that it simply is not true.

Austerity #nlpoli

All this talk of austerity, gutting the public service….

Then you look at the salary costs, from the provincial budget.

There’s something that just doesn’t add up.

-srbp-

The Red and the Black: budgets and politics #nlpoli

The annual budget is probably the most political document of any government in a Westminster style parliament like ours.

At its simplest and most obvious level the budget is the formal statement of a government’s priorities.  Once approved by 1the legislature, it gives government the legal authority to spend money.

The budget is, in that sense,  the most obvious display of what political scientist David Easton defined as politics:  the authoritative allocation of values.

There’s more politics to the budget than just that, however.

Fearful Symmetry #nlpoli

There are a couple of constables in an office over in the basement of the old Memorial College building at Fort Townshend, right next to where the USO building used to be.  They handle all the mysterious calls about weird goings on,  sort of like a local version of the X-Files.

So the scuttlebutt has it at the nearby Timmies,  the boys got a call Thursday afternoon about the time Ross Wiseman was reading his budget speech.  The workers over a Colonial Building said they saw two fellows come out of the old House of Assembly Chamber,  arm-in-arm. 

There was one older fellow, a bit on the round side,  who walked with a limp.  The other fellow walked very straight and had a really high collar on his shirt.  Sorta like Don Cherry would wear one of the workers said.

The two fellows went out the front door of the building, the workers inside said.  The only problem was they didn’t open the door.  They just walked through it.

Conservatives stay the debt-building course #nlpoli

Budget 2015 offered absolutely no surprises.

On major areas the Conservatives continued their policy of spending more than the provincial treasury can afford.  That’s been their trade-mark since 2003 and it became etched in stone in 2009.

As SRBP forecast a couple of weeks ago, the Conservatives raised a modest amount of money through a two percent hike in the provincial sales tax and a variety of small fees.  They added some new tax brackets at the upper end of the income scale.  The small twist in that one came from the actual release of the proposal by Memorial University’s economics department.  They recommend an improved rebate scheme to transfer the additional tax revenue to lower income residents.

Other than that, the Conservatives borrowed heavily. The deficit is a record for any government since Confederation. Your humble e-scribbler knew it would be bad.  It was worse than imagined.  That’s because – contrary to the forecast – they didn’t reduce capital works spending.

Lots of people are focused on the tax increases.  They amount to slightly more than than 10% of the total deficit. In the bigger scheme of things it is nothing.  It is just laughable for anyone to call this budget “tough”. 


Let’s look at some specific points.

The little things will get you #nlpoli

Maybe someone can point to this information somewhere please.  Maybe your humble e-scribbler missed it.

But  in the past couple of days, there’s been a simple number missing from the discussion of long-term care beds in Newfoundland and Labrador.

How many do we need?

Seems like a fairly obvious question.

Both Premier Paul Davis and health minister Steve Kent pointed to the current problem with chronic care patients taking up acute care beds.  That’s been happening for decades. They used a number of 237 as the number of beds being occupied in acute care facilities by patients needing long-term care.

But that isn’t all the demand.  That’s just the stuff that they actually have right at the moment.

So how many long-term beds do we need?

Yes. The government has big financial problems #nlpoli

Yet another academic paper emerged on Tuesday that pointed out that the provincial government has a big financial problem caused by following the flawed policy of spending all the money it takes in, plus more besides.

Don’t take that as a dismissal of the paper by University of Calgary professor  Ron Kneebone. To the contrary,  Kneebone’s paper adds yet more weight to the argument offered by a few people in this province since about 2006 or so. 

Taken together with the recent report by the Conference Board of Canada on the province’s economic competitiveness and you have a pretty strong indictment of the Conservative/Lockean policy the provincial government has been following since 2003.

Contending Political Strategies #nlpoli

Starting last Friday, the ironically-named Conservatives currently running the place started holding a series of “pre-budget” announcements.

They started with news that to deal with the massive financial crisis they would be dumping 77 and a half teaching positions in the provincial school system.  About twice that many would retire, so the school boards in the province would only hire enough teachers to fill half the empty slots.  To make that fit with the declining student enrolment,  the school boards would adjust the allowed class sizes by one student per teacher for grades 4 to 6 and by two students per teacher for grades 7 to 9.

Other than that, no change in staffing.

On Monday, the finance minister announced that the massive financial problem the government is facing led the government to cut the public service by zero real people.

Hysteriana #nlpoli

The response to the proposed boundaries for districts in the House of Assembly has been…what’s the word for it? … oh yes,  totally off-the-wall, batshit crazy.

On the Burin peninsula you have a bunch of people who claim that having two members represent Marystown instead of the current one member is an unprecedented tragedy of biblical proportions,  The town will be split in two, they claim.

Presumably families will be separated, unable to speak to one another across the giant zone of barbed wire and land mines that the northern district will erect between the southern district.  Berlin.  North and South Korea.  Right here.

You know things are going badly when… #nlpoli

… you launch your election campaign at at huge fundraiser and your signature policy announcement gets slaughtered on Twitter within seconds of the words leaving your lips.

Yes, friends,  Paul Davis told the world he will create some kind of savings fund from oil royalties.

In 2021.

If, and only if,  they can manage to balance the books by then.

And of course, only if Paul and/or the humourously named Conservatives can get re-elected not once but twice between now and then.

A number of people pointed that out immediately on Twitter on Wednesday night.