The Tibb's Eve Accord #nlpoli

Health minister John Haggie said that the health deal signed with Ottawa on Tibb's Eve was the best deal that could be got.

Haggie's probably right.  At least, the deal contains a clause that if another province gets a better deal, we can opt for that one instead.

It's been so very long since we've seen federal-provincial rackets over money that most people in Canada seem to have forgotten what they look like.  Stephen Harper didn't run federal-provincial fiscal relations like other prime ministers so the provinces stopped squabbling publicly.  Even Paul Martin was basically about handing out cash so, aside from premiers who postured entirely for the show of it, there was never really much of the sort of disagreement and negotiation that Des Sullivan reminded us all about on Monday past.

Bullying and Bennett #nlpoli

Cathy Bennett is the finance minister.  She's one of the most powerful and influential people in the province, bar none and certainly she is among the most powerful and influential women in the province.  If you just counted politicians, her role as finance minister puts her among the most influential people in Canada at the moment.

Shortly before Christmas, Bennett held a news conference to say that she had been bullied by people making comments on social media. Some of the people were anonymous and at least one of the comments Bennett complained about came from a group that was specifically protesting the government's budget.  In fact, every single comment Bennett mentioned, no matter how harsh,  came as a result of the spring budget.

Bullying is an interesting word to use here because it involves a power relationship.  What Bennett claimed  - in essence - was that anonymous people on the Internet were more powerful than she was. Lots of people were quite quick to agree with her. People like Lana Payne, an influential union leader, who devoted her Christmas Eve column in the Telegram to affirming that Bennett was weak and impotent because she was a woman in the face of anonymous men  - or people she assumed were men on social media.

Policy is people #nlpoli

Kim Keating is a member of the newly-appointed council to advise the provincial government on oil and gas issues.

She's a professional engineer,  a senior official with a local company in the oil and gas business, and in the recent past she was the president of the St. John's Board of Trade the year that the Board wholeheartedly endorsed Muskrat Falls.

That's important because the Board not only endorsed Muskrat Falls for all the benefits that flowed to companies like the one Keating works for, but also because the Board was willing to trade away free enterprise in order to get those juicy business goodies. A key element of making Muskrat Falls work was the creation of a monopoly for Nalcor so that the company could force local consumers - and local businesses - to pay whatever it would take to satisfy Nalcor's creditors.

In other words, no matter how high the price for the project went,  local consumers would be stuck with the costs. Keating and her associates were okay with that.

But there's more to the issue than that.

Beethoven's 9th Symphony

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O come, o come Emmanuel

Canada-NL Health Deal: Warning Signs #nlpoli #cdnpoli

Late Friday evening, the provincial government announced it had signed a deal with the federal government on health funding.

We don't know what the arrangement is on the annual increase in funds but if it looks like what New Brunswick bought into,  Newfoundland and Labrador won;t see anything significant.  Once we've got more details, we'll get back to you on that.

As for the money tagged for home care and mental health,  there will be another $160.7 million over 10 years.  That works out to $16.7 annually. Since we get $738 million annual now from both the Canada Health Transfer and the Canada Social Transfer,  that works out to an annual increase of  zero point two percent (0.2%).  New Brunswick's deal got them zero point three percent (0.3%).

These health transfers will be delivered based on the population.  Since the government's own optimistic forecast has the population shrinking over the next decade, we may well wind up with less money from Ottawa at a time when our demand for health care funding will increase.

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Es ist ein ros entsprungen

In the bleak midwinter

Spin, illustrated #nlpoli

Spin is a bit more than a mere biased interpretation or a clever reframing of an idea.  In other words, there's more to it than saying the glass is half full rather than describing it as half empty.

Spin is deliberately deceptive.

On Wednesday,  the folks at Nalcor announced they had a new contract with Astaldi valued at more than $1.8 billion.  Nalcor boss Stan Marshall told reporters and they all dutifully repeated the comment that the new contract would add "$270 million" more to the $11.4 billion estimated cost of Muskrat
Falls.

The original contract with Astaldi had a value of  CDN$1.0 billion.  Astaldi actually booked the contract at about CDN$1.24 billion.  That was 2014. In its online account of the latest twist in the tale, CBC actually inflates the announced price of the original contract to the number Astaldi claimed in 2014.  Make no mistake:  Nalcor pegged the cost of the contract at $1.0 billion. Period.

By late 2016,  after Nalcor disclosed that the company had completely screwed up the contract, Nalcor folks started to describe the original value of the contract as $1.1 billion and allowed that a "bridging agreement" meant Astaldi could earn up to another $150 million by meeting performance milestones on construction of the powerhouse.

So now we have a new contract that increases the original contract by $830 million,  not the $270 figure Nalcor used to describe the increase in their most recent estimated cost of the whole project.

Why against $11.4 billion,  $270 million sounds like nothing at all and it is precisely that deceptive comparison  - dutifully repeated by every reporter on Wednesday  - that Nalcor is relying on to mask the real magnitude of Nalcor's shag-up with the Astaldi contract. In truth,  the new Astaldi contract is responsible for an 83% cost overrun on the contract price of the powerhouse and we are not done yet.

The original estimated cost of the dam and line to Newfoundland was supposed to be $5.0 billion.  We are now more than double that figure and well on the way to tripling it.

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Ding dong merrily on high

Gender Gap - Sunshine edition #nlpoli

The House of Assembly passed a bill during the last sitting that would allow the government to publish a list every year of all the people working for government who make more than $100,000 a year.

With all the fuss about the so-called Sunshine List,  maybe it is worth taking some time to have a look at some of the information we already have, thanks to Statistics Canada (CANSIM 111-0008)

 In 2004, 396,050 people in the province reported an income.  6,500 of them made $100,000 or more.  That's 1.6%.*

1,010 of them were women, which works out to zero point two percent of all people with incomes. That leaves about 1.4% (5,490), namely the men,  who earned more than $100,000 in 2004.  Women made up 15.5% of the people who made more than $100,000.

Now flip ahead to 2014.  The number of people with incomes grew by 6% (25,100) but the number of folks making more than $100,000 grew by 443% (28,840).

People making more than $100,000 made up 8% of people with incomes in 2014. Interestingly, 6,320 women made more than $100,000.  Interestingly the male/female ratio of folks in the income category stayed very much the same.  18% of the folks earning more than $100,000 were women.

That jump in the percentage of people making large salaries mirrors what James McLeod found in the public sector. Unfortunately, the Telegram has disappeared McLeod's blog posts in their redesign of the Telly website.

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* Re-written for clarity.

Gender Gap, 2004-2014 #nlpoli

In 2004,  the median income for men in Newfoundland and Labrador was $10,000 higher than the median income for women.  By 2014,  the gap in median income between men and women in Newfoundland and Labrador had grown to $16, 130.

The median income for women had grown $8,810 between 2004 and 2014.  But the median income for men grew by $14,940.

That's a pretty chart showing the median income in Newfoundland and Labrador for the period 2004 to 2014.  The data is from CANSIM 111-0008.

Turquiose line = men.  Red line = women.  Orange is the median income for both sexes.

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The Darker Side #nlpoli

The day after Cathy Bennett talked about the hate-filled and threatening messages she'd received after delivering last spring's budget, the echo chamber that is Newfoundland politics had already absorbed the story and claimed it confirmed  that men were the only perpetrators of the violence that was aimed exclusively at women politicians and political activists.

In itself, the speed with which familiar, affiliated voices appropriated the story is a reminder of the extent to which social media  - and media generally - is not so much the vehicle of open discussion aimed at finding truth from facts as much as it is another battleground in partisan warfare that unfolds along predetermined lines.

CBC Radio Noon asked a question for its Wednesday show:  "If Finance Minister Cathy Bennett were a man, would she be such a target on social media?"

The answer is "yes" although that's not the way the show and its guest answered the question.

Brutal #nlpoli

Any Liberals who thought they were out of the political woods got a harsh reminder of the truth on Tuesday.

Their leader remains as unpopular as ever.

According to Angus Reid, only 20% of respondents to their recent poll thought Premier Dwight Ball was doing a good job. That's scarcely changed since last spring.

75% disapprove of the job Ball is doing.

Corporate Research Associates showed a curious 10 point jump in its leader-choice question last time around.  Bit of a different question, to be sure, but folks might want to notice that CRA winds up being a bit of an outlier in this respect. Other pollsters had results for party choice through October and November that were all pretty much the same. Seems odd that everything else would track but that something like support for party leader would be well outside the margin of error of the polls.

Maybe CRA was little bit high.

Maybe.

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Townie Elite #nlpoli

Add Townie Elite to your online reading.

Peter Jackson spent 25 years at the Telegram, where he used to write a regular column.

Now he's decided to come over to the dark side and offer his opinions online through a blog. These are early days for the Elite.  He only has one post up so far.  Get into the habit of reading him early on.  Peter is the kind of guy you won't always agree with but you can count on him bringing his strongly-held views to the table every time.

If we are lucky, Peter will do more than just clack out opinion pieces.  His wife is a talented artist in her own right and between the pair of them,  Townie Elite could evolve into an eclectic mix of music, writing, politics, journalism, and philosophy.

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Unacceptable #nlpoli

Finance minister Cathy Bennett did something very brave on Monday.  She did something far braver than carry on without disclosing some of the horrendous abuse she and her family has suffered since last spring's budget.

She talked publicly about the threats and abuse.  One cannot watch the video of Bennett talking about the events and not be touched by the trembling of  her lip,  the quivering of her voice as she discusses hateful comments aimed at her relentlessly.

Well, that is,  not if one is a compassionate human being in any event.  Far too many people took to Twitter to continue the attack on Bennett whether by dismissing the remarks as nothing or to justify the attacks. Just to make sure everyone understands this isn't bile coming from men alone, aimed at woman, take a look at the remarks offered by a prominent artist in the province, herself the mother of three girls.

Six dollars and eighty cents #nlpoli

We should pay members of the House of Assembly a good salary because they do a hard job that demands much of them and their family.

It is a thankless job but it is an important job for our province and its people.  One of the hazards of the job is that they must take a lot of personal criticism from ignorant people. Sometimes the ignorant people are on Twitter, as in the past week or so, and sometimes, the ignorant folks are other politicians, like in 2014 when Dwight Ball condemned their pension system or in 2015 when he arbitrarily decided to cut public representation in the House of Assembly.

We should not make decisions based on ignorance even if, as in this case, the ignorance is widespread.

AIMS refutes austerity hysteria #nlpoli #AIMS

From the latest Atlantic Institute for Market Studies paper:

"Measuring Austerity in Atlantic Canada investigates whether the use of the term austerity in the context of Atlantic Canada’s public finance is accurate. The author examines public accounts data from the four provinces, adjusting for inflation, to determine the annual amount of program expenditure in absolute and per capita terms. He also calculates the relative increase or decrease in spending from year to year, establishing the trend in provincial government expenditures in Atlantic Canada.

"The report offers three main findings:

• The budgets of southern European countries such as Portugal, Italy, Greece, and Spain (the so called “PIGS” nations) have experienced genuine austerity following the Great recession. These countries had to cut their government spending by up to a quarter, over as few as two fiscal years.
• Provincial governments in Atlantic Canada have increasingly spent more money on programs — in absolute and per capita terms — between 1980 and 2016. Per capita program expenditure in Newfoundland and Labrador saw the greatest increase at 113.7 percent. Prince Edward Island’s growth rate was the slowest at 61 percent over the examined period.
• A shifting demographic landscape in the region — notably its aging population — does not suffice to explain these significant spending increases. While the school-age population has dwindled in the four Atlantic provinces, education spending continues to grow, showing that spending increases cannot be a response to demographic changes.

"The report concludes that the use of the term austerity in relation to fiscal policy in the Atlantic Canadian provinces is hyperbolic, inappropriate and inaccurate.

"All governments spend more money than they did a generation ago, with only minor blips of restraint and no sustained or disciplined effort to cut spending significantly. The nature of Atlantic Canadian public finance, therefore, is not one of austerity but of consistent spending growth over a sustained period."

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Poll numbers not very comforting #nlpoli

A little over a month ago,  only about 16 or 17 percent of respondents told pollsters they thought Dwight Ball was the best choice for Premier.

In November, 27% of respondents picked Ball above Paul Davis and Earle McCurdy in Corporate Research Associate's quarterly survey.

That's a big jump in 30 days.

The only thing that changed in those 30 days is that folks finally got the message Ball has been sending since July:  all those layoffs and cuts we had planned for the fall are off. If public perception of Ball is that closely tied to whether or not he carries an axe,  his political fortunes will rise or fall with the provincial government's financial state.

Megawreck #nlpoli

Over the past couple of weeks, the people of Newfoundland and Labrador have been shown more and more the lunacy that is Muskrat Falls.

Nothing better exemplifies the crazy world of the Muskrateers than Dwight Ball's claim in interviews that he has wrestled the project back under control.  Not long after, we learned that problems with the cofferdam and the powerhouse go back to the summer and yet the public have only just learned about the cost over-runs that will continue on a project that is as far from under control as possible.

We don't need to review all of this because you can find posts about the decision-making failures at Muskrat Falls long before now.  In light of the recent revelations, it's worth going back tos ee how may of the problems turned up way before anyone started building.  So enjoy these posts from 2012 on decision-making.

Try not to cry.

• "How to make bad decisions"  (May 2012)
• "The inevitable Muskrat Falls"  (July 2012)
• "Cost over-runs and Muskrat Falls" (July 2012)
• "High politics and Muskrat Falls"  (July 2012)
• "Executive Politics and Muskrat Falls"  (July 2012)
• "Going down by the front end"  (July 2012)

"The past decade has shown that even the best owners and contractors have been largely unable to scope, define, plan, estimate and execute these mega-projects with any sort of predictability. Cost overruns of 100% or more have been widely reported, along with years of schedule delays. In fact, such experiences are so common there is even a word for it: a 'megawreck'." (Westney Consulting Group)

• "The stuff we don't know" (July2012)

For fun, take a look at a post from February 2012 about the cost of Muskrat Falls and the impact on consumers.  When Danny Williams set us down this road,  Kathy Dunderdale said the thing would raise electricity prices to something like 17 cents a kilowatt hour.  

The most recent estimate - now long out of date  - was for about 21 cents a kilowatt hour.  When people talk about the new loan guarantee shaving off a bit of the cost, understand that the loan guarantee will only have an impact on future cost increases.  In other words,  we are still talking about consumer prices of at least 21 cents a kilowatt hour.  Remember that number.

In February 2012,  Nalcor calculated the cost of service price for Muskrat Falls electricity, including the approved rate of return was 21.4 cents per kilowatt hour. That's not the cost of electricity to consumers but even at that point,  Nalcor was talking about taking consumer prices from around 11 cents a kilowatt hour to 17 cents in order to cover off the cost of Muskrat Falls.

That 21.4 cents didn't include construction of the transmission facilities or any of the subsequent cost over-runs on the project. The cost of the project is roughly double what it was in February 2012.

Now do a bit of math.

Try not cry.

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