Actions and Words (2016) #nlpoli

The provincial cabinet has known since January - at least - that the powerhouse at Muskrat Falls is only 15% completed despite a huge payout to the contractor.

That's what Nalcor reported to the committee of provincial bureaucrats named by the Conservatives to get a report from Nalcor every now and again.  They can't do anything else except receive the reports and pass them on to cabinet.  They still do it under the Liberals.

The company hired by cabinet to conduct yetanother review of information supplied by Nalcor that government already had included a little table of progress on major components at Muskrat Falls.  The powerhouse is a major component.

But it isn't on EY's table, shown at right and released earlier this month.  It's lumped in with "spillway" and shows it is supposedly almost 40% complete.

There's a lot of difference between 15 and 40.

A bail out, a bail out ... #nlpoli

Conversation about the province's financial state in the past couple of weeks have turned to talk of bailouts and threats to the province's sovereignty.  A Carlton University economist  told CBC in early January that the provincial government would need a bailout to keep the province from collapsing under the weight of electricity rates once Muskrat Falls arrives. Energy analyst Tom Adams talked about Muskrat Falls with Pete Soucy and Paddy Daly.

The talk about bail-out is related, in one sense, to a refrain some people have been singing for a while now that somehow the provincial government is hard-done-by because it doesn't get Equalization despite having this huge financial mess.  People who say those sorts of things don't understand a thing about Equalization.

Let's take a quick look at the province's finances and the idea of a bail out.  In another post, we'll look at sovereignty.

The Narrative War (2015) #nlpoli

The day after a massive Liberal victory in the general election,  CBC’s David Cochrane posted an analysis piece on the new administration.  CBC distributed it nationally.

Cochrane described Dwight Ball as a man “unlikely” to be Premier:

Four campaigns. Two losses. Two wins.  By a combined 75 votes.

Cochrane’s account leaves out relevant context.  When it comes to describing how the Liberals won,  Cochrane focuses not on anything the Liberals did but rather a string of Tory blunders that  - according to Cochrane  - made it easy for the Liberals to win the election essentially by accident.

And now, as Cochrane’s story goes, Ball The Unlikely will have to face enormous financial problems using a plan that Cochrane claims “was greeted with enormous scepticism in the final week of the campaign.”

In the supper hours news, Cochrane then reported on information leaked to him by someone with access to highly confidential government  information.  Their purpose  - quite obviously – was to maximise the the damage to the new administration before it even had a chance to take office.  The information fit quite neatly with Cochrane’s ongoing narrative and so, he naturally, had no hesitation in using it. 

The last man on the moon

Gene Cernan died on Monday.

He was many things in his life but Cernan will be best known as the last man who set foot on the moon during the Apollo missions.

Cernan's official website contains all you will need to know about the man who went to the moon twice: once as lunar module pilot on Apollo 10 and later as commander of Apollo 17.

His memoir - The last man on the moon - became a 2014 documentary of the same title.

-srbp-

Cognitive Dissonance (2014) #nlpoli

People like things in life to fit together.

When things don’t fit together, people get upset.  They get fidgety.  They try to make things fit together.

It’s an idea regular readers know from other posts.  Take this bit from a post from 2012 as a good example of how some people react when faced with a situation where what is happening doesn’t fit with their preconceived notions. The context was a decision by then-Premier Kathy Dunderdale to refuse to meet with the parents of a boy who had  died tragically.

Our friend the open line caller did exactly what people tend to do when confronted with this cognitive dissonance.  He made up a completely fictitious set of claims.  Kathy Dunderdale was the victim of a plot.  Some unspecified crowd called “they” had set a trap for her with this meeting.  When they tried to spring it, Kathy foiled their nefarious plot. 

The media have been pounding away at this  because they just love misery.
And the root of it all was the end of the sectarian school system almost 20 years ago.  Since the evil Liberals did away with sectarian schools, we have been set on just this course.  Politics in this province is gone down to the lowest level with this sort of mean-spirited attacks on good people, besmirching the good name of lovely people like Kathy who are only trying to do good for the world.

A muskrat by any other name... #nlpoli

Memorial University economist Jim Feehan proposed in the December issue of Canadian Public Policy that the provincial government should change the way electricity is priced in Newfoundland and Labrador once Muskrat falls comes on stream.

Now to be clear,  the way government prices electricity will already change for Muskrat Falls.  The project is so financially odious that the only way its proponents could get it off the ground in the first place is to force local taxpayers to bear the full cost of the thing, plus profits to everyone involved except themselves.  That's what will happen.

The provincial government used to have a policy to ensure we had the lowest cost electricity possible. No any more.  With Muskrat Falls, we get the most expensive electricity possible and may well wind up with the most expensive electricity in Canada.

Now Feehan is suggesting that we price electricity  based on the external markets in the fashion that the pricing will be set for the Nova Scotia block.  Unbundled transportation costs and let people see what they are paying for that.  And allow other costs of providing electricity,  like fluctuations in oil prices, show up directly on consumer electricity bills.

The Keystone Kops Ride Again (2013) #nlpoli

We already knew that the provincial cabinet had abandoned their budget before the document had been debated in the House.  That happened last week when the Premier ordered the justice minister and the attorney general to abandon the cabinet-approved cuts in the justice department.

Less than 12 hours after meeting with the same officials justice minister Darin King consulted before cabinet approved the cuts, King and attorney general Tom Marshall (right, not exactly as illustrated) told reporters that whatever those officials had said would now be the policy.

The change of policy is breathtaking enough.  Not only will some of the laid-off court security officers be rehired, but cabinet has also lifted the hiring freeze to allow the High Sheriff to immediately hire more staff.  Someone will also be appointed to conduct operational reviews of the three divisions – High Sheriff,  legal aid and Crown prosecution service – involved in the cabinet flip flop.

But that’s not the truly striking aspect of this abrupt change.

Watch the video of the media briefing posted by CBC

At 40 seconds into his remarks, King confirms that the direction to abandon the cuts came from the Premier herself last week.  The Lady indeed was for turning.

Conservatives and Millennials #nlpoli #cdnpoli

The talk was supposed to be about the political culture in Newfoundland and Labrador.  Does it ever change?

What Tim Powers wound up spending a lot of time talking about was Donald Trump,  millennials, and Liberal Party databases in the last election.

Not surprising, really, given that Tim is a veteran Conservative backroom guy and the federal Conservatives have been looking at how the Liberals bumped them out of power in the 2015 federal election.  They are so fascinated by the Liberals' internal campaign management system they have been complaining that the Prime Minister's national tour is just an excuse to build up a contact database.

Yes, b'y,  like there is no other way to collect names, telephones, and email addresses and collecting them is all there is to it.

Toward a fair and just society (2012) #nlpoli

The December 2008 expropriation bill was not the right thing for the provincial government and the House of Assembly to do.

The expropriation was wrong.

It was wrong, but not because it didn’t work.

It was wrong, but not because the provincial government accidentally expropriated a contaminated mill site.

The December 2008 expropriation was wrong because it was a violation of the fundamental principles on which our society is supposed to operate.

Debt servicing and revenue, 2013-2016 #nlpoli

There are lots of ways of looking the government's budget. Here's one that's a bit unconventional.

Rather than look at how much the government is spending on debt servicing as a share of all expenses, let's take a look at what it means as a share of the government's income from its own sources.

Debt servicing is the amount spent to pay the interest on public debt. Own-source revenues excludes federal transfers and borrowing.

Year	Percent of Own-Source
2016b	21
2015	16
2014	07
2013	06

The percentage is a function of the amount spent to pay interest on the public debt and the amount of money the government earned from its own sources.

Debt servicing tripled in four years, going from $360 million to more than $1.0 billion. Own-source revenues dropped by about a billion dollars, going from $5.762 billion in 2013 to $4.775 billion in the 2016 budget.

That's a really good indicator of how rapidly the government's financial situation deteriorated.

-srbp-

Torque wars: media, politicians, and the Muskrat Falls loan guarantee #nlpoli (2011)

Some people will tell you there the federal and provincial governments have a deal for a federal loan guarantee on Muskrat Falls.  The provincial government has already met three criteria set by the federal government and Stephen Harper confirmed that in a speech in St. John’s.

That’s what you could take out of some stories from different media outlets coming out of Harper’s campaign stop in Newfoundland and Labrador.

Bear in mind though that the loan guarantee story took a couple of turns within the past 24 hours even for one single news outlet. 

On Wednesday, CBC reported the deal was done:

Multiple sources tell CBC News, though, that the federal and provincial governments have reached a deal on the terms of a loan guarantee.

Multiple sources.

Multiple unidentified sources.

Not even a hint if they were highly placed in both the federal and provincial governments.

Sometimes that happens.  You don’t even give the slightest clue as to the authenticity of the sources on which the story is based. Put it down to a judgment call.  Doesn’t mean that the comments are right or wrong, but it could put a question mark over the accuracy of the information.

Campaign Finance Reform: shifting attention #nlpoli

Until 1996,  there were no campaign finance laws in Newfoundland and Labrador at all.

In 2003,  the Conservatives promised to make dramatic changes to the laws governing how parties financed election campaigns.

They delivered none of it.

In 2015,  the Liberals promised changes to campaign finance laws and one year into their new mandate, the Liberals are looking at appointing some experts to make recommendations on changes to elections laws.

In the weekend Telegram,  James McLeod described this lack of action one year into a new mandate as "massive delays" on democratic reform but starts out his story by talking about something else entirely.

That's your first clue something is out of focus.

Williams announces political exit plan (2010)

Danny Williams always said that building the Lower Churchill was the only thing he wanted to do before leaving politics. He took a huge step down that road in 2006 when he rejected other options in favour of the supposed go-it-alone strategy.

With no markets and no money for the project, and with setback after setback in the environmental and land claims fronts, the odds were slim he could achieve that dream.

Slim odds, that is, until this weekend. Williams told provincial Conservatives he is trying to lure Nova Scotia and Emera  into a deal to build a greatly scaled down version of the project.  That confirms he is trying to cut a deal so he can leave politics.

If only we were New Brunswick... #nlpoli

Premier Dwight Ball has talked about it.

CBC's Peter Cowan tweeted about it Sunday night.

If only we were like all those lucky provinces that get Equalization,  we'd be right as rain.

We can allow that Peter may not understand federal-provincial finances at all, even if he does cover the legislature a lot.  If there's one thing SRBP readers will know is that most people in the country, including pretty well every reporter and politician,  hasn't got a clue about Equalization.  Well, give Peter a bit of a break but there's no excuse for cabinet ministers being stupid enough to talk about Equalization like a province was entitled to it because it was running a deficit.

You can find a summary of Equalization from SRBP last January. You can find an earlier dose from 2005. That should give you the basic understanding Dwight and Peter evidently lack. But for the fun of it, let's look at how we might fare if we were the same as New Brunswick as far as Equalization is concerned.

Behaviour Patterns #nlpoli

January 2016.

Dwight Ball tells reporters in year-end interviews that "everything is on the table" to deal with the government's financial problem.

Then, Ball took everything off the table. As SRBP put it last year:

No cuts to spending as that would slow the economy.  Ditto for tax increases.  Even “efficiency” went out as Ball told the Telegram’s James McLeod that you couldn’t deliver existing services without the existing staffing levels.

In the budget,  the provincial government boosted spending by 12%.  That was on top of the 12% boost the year before.  Ball increased taxes, largely because the bond raters and the short of cash in the markets gave him no choice.  There were some modest cuts but the cash just got shifted to spending somewhere else.

The big cuts, the serious cuts or whatever Ball hoped to achieve with the unions would come in negotiations.

All the usual suspects - opposition politicians, union activists, people dependent on government hand-outs - accused Ball and the Liberals of "austerity".

Rumpole and Justice Delayed (2009) #nlpoli

There is no question that our system provides a great method for adjudicating questions of fact and law, but given the expenditure of public funds we are obliged to the people of Newfoundland and Labrador to provide the best possible system in terms of the efficiency of the process.

Report of the Task Force on Criminal Justice Efficiencies, February 2008

Administrative changes recommended by a committee of lawyers and judges to improve the province’s justice system still haven’t been implemented over 18 months after they were made public.

In December 2007, newbie justice minister Jerome Kennedy appointed a task force that included deputy minister Chris Curran, then Chief Provincial Court Judge Reg Reid and Mark Pike, the current associate chief judge, among others.  They issued their report in February 2008because they were specifically directed “to make recommendations and to meet any necessary budgetary deadlines for the ensuing fiscal year.”

The committee agreed that “with appropriate leadership, goodwill and resources, its recommendations could be fully implemented by the fall of 2008.”

Oil downturn slams petro-provinces' jobs #nlpoli

The four provinces heavily dependent on oil and gas resources took a major hit in jobs in 2016, according to seasonally-adjusted figures released on Friday by the Dominion's statistics bureau.

Alberta lost almost 35,000 full-time jobs. Nova Scotia lost more than 13,000 full-time jobs. Saskatchewan dropped 12,400 full-time jobs.  Newfoundland and Labrador lost 6,000 jobs between December 2015 and December 2016.

Growth in part-time employment in the same period offset the losses. Newfoundland and Labrador gained only 300 jobs, leaving it with a net employment loss of 5,700. Nova Scotia added almost 16,000 part-time jobs, though,  giving it a net gain in employment. Saskatchewan added 5,500 so the province ended the year with a net loss and in Alberta,  the economy added more than 16,000 part-time jobs.

None of this is a surprise to anyone who has been paying attention.  The downturn in the global oil industry that hammered Newfoundland and Labrador's government revenue has also been kicking the local labour force. In Newfoundland and Labrador, the government forecast last spring that the economy will shed jobs steadily over the next four years as the megaprojects at Long Harbour, Bull Arm, and Muskrat Falls wind down.  We got a reminder of that in August in some comments by education minister Dale Kirby.

Males fared worse than women in the Newfoundland and Labrador seasonally-adjusted full-time jobs figures.  Male full-time employment fell from 107,400 to 99,900 between December 2015 and December 2016.  By contrast,  1,400 women had full-time jobs in the province in the same period (from 87,400 to 88,800)  Part-time employment among males went from 9,500 to 13,000, while female part-time employment fell (28,600 to 25,400)

-srbp-

Media Donations to NL Political Parties #nlpoli #cdnpoli

Steele Communications and its subsidiary VOCM made a combined total of $23,600 in contributions to political parties in Newfoundland and Labrador between 1996 and 2009, according to party finance information published by the province's chief electoral officer.  All but $900 of it went to the provincial Liberal party.

Communications Ten,  owned by the publisher of Atlantic Business Magazine,  donated $7,700 to the provincial Conservatives between 2003 and 2015.  The company gave the Liberals $50, once.

Robinson-Blackmore operated a string of weekly newspapers across the province until it was bought out by TransCon.  Between 1996 and 2001, RB  made political donations totalling $7,489.20 to Liberals and Conservatives.

Electoral office records show one contribution by Newfoundland Broadcasting Corporation  to the Conservatives for $1,000 and a single donation of $150 to the Liberal party by Downhome Publishing since 1996.

Until 1996,  Newfoundland and Labrador had no rules governing election financing.

-srbp-

The poverty of "we so po'" rhetoric (2008) #nlpoli

“People need to understand government cannot write a cheque for everything,” said Williams.  

“We can’t be all things to all people.” “On the other hand, even in poor times, we have tried to do the best we could for people who were, for lack of a better term, in poorer positions.” 

Those were some comments made by the Premier to news media in Corner Brook after a two day cabinet retreat.

The first reaction would be to wonder when, over the past four years, has the provincial government actually experienced "poor times".

Putting the sunk in sunk cost #nlpoli #cdnpoli

Muskrat Falls is basically an $800 million tax on the people of Newfoundland and Labrador. That's roughly the amount you get using numbers Nalcor chief executive Stan Marshall made public last summer.

Muskrat Falls is a tax on the people of Newfoundland and Labrador.  Always was that.  Never was anything else.  The plan was to collect the tax by doubling electricity rates.  Regular readers have known this since *before* Danny Williams announced the scheme.

Take all that as the starting point when you hear Dwight Ball tell Anthony Germain on the CBC St. John's Morning Show that Ball is spending a lot of time trying to figure out how to keep our electricity prices from doubling.