Tom Marshall is a typical politician. He got into politics to make things better.
And, as he reaches the end of his political career, Tom feels a little frustrated or disappointed in how things turned out. Marshall’s big hopes didn’t turn into equally big results.
So he blames others.
A couple of years ago, Liberal leader Dwight Ball said the Liberals would use earnings from Muskrat Falls to lower electricity prices for consumers in this province.
The Conservatives dismissed the idea at the time.
Then a couple of weeks ago, with news the cost of Muskrat Falls continues to climb, Premier Tom Marshall told the province that he and his colleagues had adopted the idea of using revenues from Muskrat Falls to lower consumer prices as their own policy.
That’s not all of it. To understand the importance of Marshall’s comments fully you have to start at the beginning.
Federal provincial relations
Cast your mind back to the early part of 2012. Kathy Dunderdale was frustrated. She couldn’t figure out how to deal with the crowd in Ottawa.
Suck up to them.
Attack them.
Didn’t matter.
They still wouldn’t do what Kathy wanted.
Watch too many crime shows and after a while a few of the ideas start to sing into your skull.
Take blood spatter for example. In some kinds of violent death, lots of blood will fly around. The drops leave a distinctive spray pattern that can tell you lots about what went on.
And then there is sometimes the bits of the pattern that are missing. There is sometimes a void, a gap where something that the blood spattered on is missing.
The void – the missing stuff - sometimes tells much more than what is there.
In short, it’s bad enough when irresponsible rumour-mongers start the ball rolling.
The last thing politicians should do is feed the flames with fibs and subterfuge.Wonderful stuff, that, if only we could all safely rely on those inquiring minds to quickly ferret out the truth.
Tom Marshall used to be the finance minister.
He’s the guy who consistently, year after year, spent more than the people of the province could afford. Tom didn’t do it by himself: he had the support of all his colleagues in cabinet.
And since 2009, Tom and his colleagues have admitted that they mismanaged the provincial government accounts by overspending.
Deliberately.
Along the way, Tom has claimed some things that aren’t true. Like saying that he and his colleagues lowered the provincial debt when they didn’t.
So now that he is natural resources minister, Tom Marshall is still telling people things that aren’t true. This time it is about the glories of the 2008 expropriation.
What Tom says.
The truth.
Two different things.
Natural resources minister Tom Marshall announced in the House of Assembly on Tuesday that the provincial government had settled with the last of a string of private companies victimised by a 2008 asset grab of hydro-electric generating facilities by the provincial government.
Taxpayers will cover a $54 million debt owed by Fortis, one of the partners in the Exploits Partnership, as well as pay the company an additional $18 million. Taxpayers have already paid more than $4 million according to media reports, bringing the total to about $76 million for the Fortis asset swipe alone.
In 2011, the provincial government took responsibility for a $40 million loan owed on Star Lake, another part of the 2008 hydro asset expropriation. The government also paid $32.8 million to Enel one of the partners in the project.
The provincial government seized the hydro assets in an extraordinary expropriation bill that government original touted as being aimed at Abitibi in punishment for closing a paper mill in the central Newfoundland town of Grand Falls-Windsor.
Information subsequently came to light that confirmed the government’s real target in the expropriation were the lucrative hydro-electric generating assets owned by Abitibi, Enel, and Fortis in two separate partnerships. The provincial government turned over the assets free of charge to the Crown-owned Nalcor Energy.
Nalcor will now use the generating stations to help meet its commitments to provide Emera with free electricity for 35 years under the Muskrat Falls deal.
For now, though, taxpayers are being forced to pay for the seizure and for the electricity Nalcor makes at the seized plants. Under a cabinet order dated April 4, 2013, Nalcor sells electricity from the Exploits plant to its subsidiary Newfoundland and Labrador Hydro for the fixed price of four cents per kilowatt hour. Hydro sells the power to consumers at much higher rates, thereby pocketing a sizeable profit entirely at public expense.
In its original plan, government intended to skim off any valuable assets and leave Abitibi with any environmental liabilities. As it turned out, the expropriation seized one of the most polluted properties Abitibi held. The expropriation freed Abitibi of any liabilities since they went with the ownership.
There is no independent estimate available of the costs of the environmental clean-up of the seized facilities.
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In Nova Scotia, the provincial government has to beat prospective woods companies with a stick to keep them in line in the rush to take control of lands from the former Bowater mill in that province.
Seven groups want to get some part of the 220,000 hectares, a power plant, a mill site and all the timber that used to go into the paper plant.
The longest filibuster in Newfoundland and Labrador legislative history ended quietly Saturday morning.
This was the second filibuster this year and the Telegram’s legislative reported posed a simple question via Twitter before the House closed.
What does it say about current Newfoundland and Labrador political culture that we’ve had two such filibusters in a single year?
Normally a filibuster is an opposition tactic to hold up a government proposal the opposition doesn’t like. That was the case with the Bill 29 filibuster in the spring.
As it turns out, the Muskrat Falls filibuster was different things for different parties.
Premier Kathy Dunderdale likes to pretend that the critics haven’t been able to find a problem with Muskrat Falls.
Well, that’s simply not true.
They’ve found tons of problems with the project that Kathy Dunderdale is finishing on behalf of Danny Williams. Dunderdale either doesn’t understand the project at all on any level, has deluded herself into believing what she says is true even when it obviously isn’t (the PUB loves Muskrat Falls!), or she just doesn’t give a rat’s bollocks about anything.
That’s pretty much what it comes down to. Take your pick but that’s it: one of those three
Regardless of any of that, though, you can be assured of one thing. Muskrat Falls is not a very good idea. It is not the lowest cost option for taxpayers.
Absolutely.
Without question.
Not the lowest cost option.
“If we hadn’t expropriated, the company still would have gone into double-C double-A protection or into bankruptcy protection, and we would have been left with nothing but the contaminated assets,” Marshall said.And federation of labour boss Lana Payne [@Lanampayne] tried the same thing via Twitter:
[In my opinion] expropriation was right decision. Otherwise we'd be left with clean-up and no assets.The only problem with this argument is that is it more supposition and rationalization than fact.
…
As the saying goes, can't get blood from a turnip. AB was restructured under bankruptcy law. Because of restructuring, NL would be where it is today: one of many parties in a long line.
In the House of Assembly on Monday, Premier Kathy Dunderdale said that the provincial government decided to seize assets of three companies in Newfoundland and Labrador in 2008 because it knew that one of the companies – AbitibiBowater - was working on a sale of some assets to other parties.
When we took a decision to expropriate Abitibi, it was something we had to do quickly, Mr. Speaker, because we knew the intention of the company was to sell the assets.
…
we decided that we would move quickly. We only had the weekend to prepare, but we all agreed that whatever risks were ensued…that it was the right thing to do and that our legislation should protect us
The following originally appeared at nottawa on September 2, 2009 as a comment on the emergency session of the legislature to deal with changes to legislation about the Churchill River.
It includes a mention of an earlier political controversy, the December 2008 expropriation bill. The two are linked and in light of Friday’s ruling by the Supreme Court of Canada in case related to the expropriation, Mark Watton’s observations at the time are worth reading again.
Danny Williams, thee Premier at the time of both these incidents, may be gone from the political scene but the ministers who were integral parts of the policies remain in positions of power. One of them - Kathy Dunderdale – is William’s hand-picked successor.
The policies and the attitudes that bred them remain in place, as finance minister Tom Marshall made plain on Friday.
Nothing has changed in Newfoundland and Labrador. And that is why these comments from three years ago still resonate:
Consider the latest failure of a lawsuit launched by the Greatest Legal Mind and Premier Ever in light of another case, Henley v. Cable Atlantic, a post that originally appeared in August 2006.
“Forgive us for believing NalCor, Premier,” about the Abitibi expropriation former Liberal leader Yvonne Jones pleads on Twitter, in the wake of the latest court decision against a Williams scheme.
“No!” comes the reply shouted from every rooftop in the province.
It’s not like the good reasons to doubt Williams and Nalcor weren’t right in front of our faces in December 2008.
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Bob Cadigan is president of the association that represents the province’s offshore supply and service companies.
He thinks that there’s more interest in exploring offshore Nova Scotia than Newfoundland and Labrador because of the way the Nova Scotia offshore regulator handles exploration data.
As the Telegram reported on Tuesday,
Cadigan said the data — like geochemistry and seismic testing results — is more difficult for curious companies to access in this province. For example, much of the seismic data here is only available on paper and not digitally, he said.
In other cases, individual oil companies completed the testing and keep the results to themselves for as long as they are allowed.
Difficulty in obtaining information about an area can limit interest in making a bid and committing to exploration work in the area, Cadigan suggested.
Okay. That could be the problem.
And then again, maybe not.
Spanish oil and gas company Repsol may be looking to sell its interest in the Saint John New Brunswick liquefied natural gas facility. The New Brunswick Telegraph Journal reported the news on July 21:
On Thursday, the Spanish oil and gas giant told shareholders it was considering the idea of getting rid of some of its liquefied natural gas business to help shore up its finances.
This includes the potential sale of the Canaport terminal in east Saint John, in which it has a 75 per cent stake. Irving Oil, Limited, owns the other 25 per cent.
The move comes on the heels of the expropriation of Repsol’s majority interest in Argentinian oil and gas company YPF by the Argentinian government. The government did not pay Repsol compensation for the seized assets.
Repsol is reportedly taking legal action and is looking at options to raise cash in the meantime. One of those options includes divesting of North American natural gas assets.
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Since its creation, Nalcor has existed in a perpetual conflict of interest of one kind or another.
SRBP raised the issue of conflict of interest 2006 when Dean Macdonald – then chair of Nalcor’s board – accepted an appointment to the board of a company Nalcor was doing or was planning to do business with.
Nalcor has been in another sort of conflict of interest in it acted as lead negotiator for the provincial government and as an oil company at the same time. On the one hand its interest should be in maximising benefits to the province while on the other hand, its interest should be to lower costs in order to maximise corporate profits. The two things cannot exist side-by-side as the Hebron agreement demonstrates.
Again, SRBP pointed this out in 2006 when the Hebron talks fell apart and on several occasions subsequently.
Time hasn’t changed much.