Monday, 17 November 2014

A-G's REPORT IMPORTANT BUT NOT COMPLETE (PART I)

The Report of the Auditor General for the year ending March 31, 2014 is important for the observations he offers regarding the state of the Province’s finances.  He delivers comment (but no conclusions) on the impact of oil on revenues, the pattern of government spending and how the lack of fiscal discipline is resolving into a serious structural deficit. It is a story told in charts and graphs more than as a written narrative.     

The Report comes as the world price of oil has experienced a 25-30% hair-cut.  Many wonder how the Government will curtail public spending without injuring the economy. Yet, everyone knows the time has passed for the easy method of fiscal restraint.  

The A-G’s Report deserves two very different comments.  

One relates to its incompleteness, though that is partly the fault of the Department of Finance, on which the work is based.  The second is why it is important; a matter which will be dealt with in a subsequent Post. 

Monday, 10 November 2014

THE TORIES: DEATH COMES SLOWLY

The Tories’ loss in the CBS by-election reflects what provincial polls have been telling us for a long time. The Party is unloved and that is being kind.  Premier Davis has done nothing to differentiate himself or his Administration’s approach to either communications or public policy from that of his recent predecessors.  

Does he not want to disassociate himself, at least, from the Dunderdale era?  Does he not understand voters are still distressed by that time?


For all the reasons that are well-known, this by-election was important to the Government and to the P.C. Party. Hoping that the bleeding was at an end and having called by-elections in Trinity-Bay de Verde and Humber East, the Premier might have wanted to proclaim: “Remember, Remember the 5th of November”! Having lost, he has no rallying cry. The voters are not inspired.  Even the most ardent partisans make no claim that theirs is a Party of renewal. 

The problem is illuminated by CBC political “Point” man, David Cochrane, who chalked up the loss to the Tories being out-hustled by a resurgent Liberal Party organization; except Cochrane has merely identified a symptom, not the source. 

Monday, 3 November 2014

PREMIER DAVIS: TEAR DOWN THAT WALL

Last week a retired Swedish geoscientist, industry leader, consultant, Professor, and internationally recognized expert on “Quick Clay”, Dr. Stig Bernander, spent three days studying what he described as a “live” land mass on the lower Churchill River. He was able to personally view, on the ground and from the air, a great many landslides and see physical evidence of active movement over a large area including the "North Spur". 

He spent another four days editing his notes, selecting photographic evidence and lecturing at the LSPU Hall and at Memorial University on the dangers of Nalcor relying upon “outdated” geotechnical analysis of the problem.

Quick Clays are unique, sensitive glaciomarine clays.  The clay deposits, at the North Spur as elsewhere, occurred when sea water levels were much higher.  They are unstable clays. Their peculiar characteristics are known to cause landslides.  When Quick Clay is subjected to sufficient stress, the material may liquefy. (Locally, some call the clays "pug".)

When a person of the stature of Dr. Bernander, having no connection to this Province, is troubled enough to perform this public service, pro bono, you have a right to think there is cause for concern.

Rissa slide, Norway

When the Vice-President of Nalcor, Gilbert Bennett, shows up at Dr. Bernander’s lecture at Memorial University, not to welcome the man or to acknowledge his internationally accepted engineering models for assessing landslide risk, not even to ask him a question, but only to express umbrage against the Professor, you know the Corporation has gotten far too used to not being challenged by competent third parties.  


Monday, 27 October 2014

THE ‘ROCK’ STAR OF “QUICK CLAY”

The biography of Dr. Stig Bernander reads like that of a ‘Rock’ Star except in his case, he is better known for his work with clays rather than rocks, especially “Quick Clay”.  Some of this “sensitive” material is present at the North Spur, the projection of land creating the natural dam at Muskrat Falls.  It is one of the issues which threaten the viability of the project.

Dr. Bernander, you ask?  Who is he and why would you be interested? I will get to those questions in a moment. First, what are “Quick Clays”?

Quick Clays are unique, sensitive glaciomarine clays.  The clay deposits occurred when sea water levels were much higher.  They are unstable clays. Their peculiar characteristics are known to cause landslides.  When Quick Clay is subjected to sufficient stress, the material may liquefy. At Muskrat Falls, Quick Clay could undermine the structural integrity of the North Spur. Remediation is potentially a money pit.  It is a public safety issue, too.

One of the best known and large Quick Clay landslides occurred at Rissa, Norway.  The slide was videoed as it progressed. The event is as exciting as it is horrifying. If you choose to follow the Link, just be patient for the first couple of minutes and the Rissa video will demonstrate why Quick Clay should be taken very seriously. It is the perfect primer in advance of Dr. Bernander’s Lecture. 

Bernander is neither politician nor bureaucrat. He is a scientist; one with long industry experience.

Monday, 20 October 2014

OIL REVENUES: DON'T WORRY. BE HAPPY!

Bobby McFerrin’s light-hearted lyric “Don’t Worry, Be Happy” seems perfectly suited to Dr. Wade Locke’s analysis, as he explained it to James McLeod of the Telegram last week, on the future of oil.  Dr. Locke is an Economist and Professor at Memorial University.

Indeed, why would we worry when the ass is coming out of the Provincial Budget!

The slide in the world price of Brent Crude, closing at US $86.16 per barrel on Friday October 17th, is a significant event and not because people will save money at the gas pumps. 

Since oil’s decline began just a few weeks ago, a host of oil producing nations including Saudi Arabia, Iraq, Venezuela, and Russia among others, whose budgets rely on $100 plus oil, have expressed concern that they will feel the sting of lower revenues. While none could forecast the exact day or week that a major correction on the markets might occur, all knew it was coming.

The fact that the U.S. will become energy self-sufficient by 2030 or earlier is old news.  Unlike the Saudis, few oil producing nations have maintained a rainy day fund.

Newfoundland and Labrador is just as reliant, on a relative basis, as many of the countries mentioned.  Oil directly generates 33% of the Province’s budgetary revenues.  The figure does not reflect proceeds from corporate, personal taxes and HST associated with offshore related jobs, construction and services. In fact, oil’s impact on the Treasury may represent as much as 50% of revenue or more when the labour pool doing the round trip to Fort McMurray is assessed.

Monday, 13 October 2014

LEADERSHIP WOES OF THE CONSTABLE PREMIER

Premier Paul Davis knows the sting of political whiplash. Just four weeks ago he experienced the euphoria of victory.  Minutes after his investiture, he discovered no honeymoon awaited him with either the pundits or the public.

It is not Davis’ fault the Auditor-General chose to dump the HVP Report on him, rather than on Tom Marshall, who is as much deserving of blame as Nick McGrath. But Paul Davis is entirely responsible for not ordering a deeper investigation into its odious contents.

As to his other decisions, what does it say about him that he would elevate an uncouth backbencher, Keith Russell, and award him Ministerial status?

The public may not understand the importance of political convention vis a vis the unelected Ms. Manning, but the Premier should.  

Similarly, even a police constable should know that changing the Department of Justice to the Department of Public Safety is akin to replacing an ‘ideal’ with a ‘cop car’. 

Monday, 6 October 2014

THE LIBERALS: NO WAY TO TREAT A LADY

Last week, the public saw Premier Paul Davis appoint an unelected female Minister of Public Safety arguing, among others things, the Government suffers a gender deficiency.  

Meanwhile, an intelligent and successful woman, a fine communicator, the MHA for Fortune Bay-Cape La Hune, Tracey Perry is left out of the Davis Cabinet.  She failed to make the list of the Williams, Dunderdale and the Marshall Cabinets, too.  

But the Tories aren’t the only ‘lug heads’ in politics when it comes to promoting women and levelling the scales of gender equality.  The tricks played by the Liberals in the District of Humber East, to discourage Corner Brook businesswoman Donna Thistle from running, do little to give the Party a legitimate claim to enhancing female representation in the House of Assembly. 

It seems Thistle was a cause celeb when the Liberals thought her a sacrificial lamb.  But when Frank Coleman’s departure from the P.C Leadership also removed him from a planned by-election, the Liberals decided they didn't want a political neophyte to challenge the Tories in the District after all.