Thursday, 24 December 2015

THE LIBERALS AND THE ODOUR OF AMATEUR

Supporters of the Newfoundland and Labrador Liberal Party must be shaking their heads in disbelief at the political naivety witnessed during the first few days of the Dwight Ball Administration.

Most have to be wondering, between the Premier, the Ministers of Natural Resources and Finance, and the Premier’s Chief of Staff, if there is a single political neuron in the “on” position.

I have never witnessed the likes of it.

But I have a scenario of what occurred in the early hours of the new Administration; one, I think, worth sharing:

The Premier having been just sworn-in, the Clerk of the Executive Council, (also head of the Muskrat Falls Oversight Committee), would have informed him the Bond Rating Agencies are looking for an assessment of how much more money will be needed to complete the Muskrat Falls project.

The Clerk, having already worked with EY, an Accountancy, which wrote the Terms of Reference for the Oversight Committee, (though none of the proposals were ever implemented), would have felt very comfortable with them. Nalcor CEO, Ed Martin, too. 

And at Martin's behest, the Clerk is ready to give the Premier grim news about the emails from New York complete with their most self-serving of ideas; ones only Nalcor could conjure.

The neophyte Premier, exhibiting all the critical skills he had shown in Opposition, swallowed the advice. hook, line, and sinker.

"Given cost overruns, schedule changes and baseline updates on the Muskrat Falls project, it is prudent for the provincial government to review the project's cost and schedule to determine if there are any critical risks moving forward", the CBC quoted Ball. 

The Premier added: "EY…will conduct the review".

The Cabinet Clerk’s sense of urgency must have been impressive.

The novice Premier, head swollen from messages of congratulations from Justin and most everyone else, having enjoyed days of rapturous celebration, and sore from all the back-slapping, he needed not a minute to reflect on his political mission; he required not even a second to digest the mess Nalcor, and the Tories, has gotten the province into.

A sense of imperviousness would neither have compelled him to interrupt the Clerk or send her off to prepare a briefing for the entire Cabinet. Ego would have obliterated any thought a worried public might have interpreted his undertaking “to open the books on Muskrat” as a serious commitment.

But, caught unprepared by Officials far more political cunning than he, the Premier bought ownership of the Tory debacle, before he could even get the feel of his new leather chair.

Of course, the most cunning are never satisfied when the challenge is so facile.

In the same wave of the Clerk’s Brief, likely drafted by Ed himself, containing the “safe” proposal for the Review, the Premier would be advised of market skittishness. He would be told it is necessary to also confirm his support for Nalcor. 

Hence, the declaration: the Premier 'had no reason not to have confidence in Nalcor senior management.'

And, there had to be something in it for the Clerk. This was all or nothing time, mister. The bureaucrats knew the novice Premier would be putty in their hands. 

The Clerk is the Chair of the Muskrat Falls Oversight Committee. People have been saying (frequently on this Blog) that it is a ‘sham’.

“Sham”, in fact, is too nice a word for the Committee struck by Tom Marshall;  useless as a source of independent judgement, offering only slavishly subservience to Nalcor’s contrivances.  

Yet, suddenly, the Premier found he liked the Oversight Committee, too!  

Here was the newbie Premier, within hours, offering support and confirmation to the very people, on the very project, to the same sham oversight, that symbolized the Tories’ downfall.  

Not for one moment did he consider stepping back to assess the policy or the political implications of what he was asked to perform.

A more astute Premier would have considered he had a Liberal Caucus, a few of them with good political instincts; all very partisan, whom he must face daily. He forgot he has a Liberal Party organization, which contains a number of astute political watchers, even if they don’t excel as policy wonks.

Worse than the “Constable Premier”, Ball wasn’t smart enough to see that Ed Martin, the man who has never built anything, including a hydro project, had his number long before he was sworn-in.

“A sucker born every day….and two to screw him”, goes the adage! 

In this case, it is easy to name all three.

And, that was only day one.        
                 
If real life trumps fiction, the awful display of political judgement evident upon the release of the “Fiscal Update” will enter the annals of political naiveté and receive a ranking far higher than can ever be assigned the Constable Premier’s faux pas, i.e. Judy Manning appointment, the Department of Public Safety, or any other.

The Tories have spent like “drunken sailors”; all, except Dwight Ball and Finance Minister Cathy Bennett, know it.

But, again, the inexperienced Premier had absolutely nothing in the political department, to offer the Minister of Finance, and she even less to offer in return.    

The Finance bureaucrats have, for the last several years, churned out completely illogical scripts for successive Ministers; fictitious 5 year plans to balance the books.

The Deputy Minister has had her knickers in a knot since the first day she took the position; now, she is anxious to unload her frustration onto the Liberals.

But she ought not to have forgotten (even if the Premier and his Minister did) that when the Party stripe changes, the narrative changes, too.  In this case, the new narrative was easily justified. Didn't the voters just say so?

But here is the politically incompetent Minister of Finance telling the public: “lower-than-expected oil production and price — Brent Crude will close out the year at $48 US per barrel, well below the PCs’ budget projection of $62 — are largely to blame for a drop of more than $800 million in 2015 revenues.” (The Telegram)

The drop in oil prices was responsible, not dreadful Tory fiscal management?

What!!!

And it get worse.

“Not a crisis”, he remarked, even though the Bond Rating Agencies are calling for proof the Muskrat Falls is not a total disaster.

"We will get this under control. The situation is difficult, but not impossible," Bennett crowed.

But that’s still not the half of it.

The Finance Department script, which suited the Tories just fine, details only the deficit on current account; officials forgot to add the $1.1 billion Capital Account (as if there was any distinction between the two!).  

They also omitted the additional $800 million Nalcor CEO Ed Martin demanded last June.

They didn't even link the additional funding required for Muskrat with an inevitable degrading of funding for public services. "Imagine suggesting "no cuts", as did the Minister, when she should have been all over the Tories for putting the public in such a difficult position.

The Liberals were unwittingly ready to downplay a fiscal crisis, one coming faster than a freight train; the feeling of invincibility must have been palpable. 

I am almost finished.

For the next and most egregious of follies, I refer you to page 6 of the Finance Department’s “Economic and Fiscal Update” and remind you that Former Tory Finance Minister, only this very year, offered a Plan to balance the books, upon four more years of deficits.

But the 5 Year fiscal outlook the Premier and Cathy Bennett just embraced describes a roughly $2 billion deficit, and only on Current Account. The Outlook has no end in sight for deficits, even after 2020-21.

Neither the Premier, nor the Minister, was capable of drawing to the public’s attention the unmitigated falsity that characterized Ross Wiseman’s Tory fiscal plan.

Not a single condemnation of Tory fiscal management was spoken!

Of course, it wasn’t in the Finance Department’s skill-set to change the narrative and, to be fair, not really their job. But, neither of the politicians were smart enough to hand the Tory script back to the officials and remind them of the election result.

They didn’t even have the political savvy to just make the “Update” public, as this Blog suggested on Monday, and tell the public they needed time to study it; that they would return to the microphones after Christmas.

The Constable Premier may be gone from the Premier’s Office.

But he has surely been replaced by someone just as junior. 

6 comments:

  1. What a piece you write, and so appropriate. And on Christman eve, surely a lump of coal for every Nflder. And Ball seems as bad as many feared. Raise revenue and cut spending surely needed. Start with an increase in gas tax: never a better time, while gas prices are low, and encourage conservation, and help offset smaller royalties and lower oil revenue from low oil prices.And raise taxes on furnace oil as well, otherwise electricity sales will tank further. Perhaps Ball wanted to delay more bad news until after the holiday season, rather than be seen as a scrooge right now. Why has the TELY no hard hitting pieces like this? And who would think we might do worse than the Constable Premier? Seems we may have. Winston

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  2. In a further example of questionable judgement, Ball's first visit to the PM, to ask him to scotch the HST increase put in place by the last government, has put NL in a weak position to look for future financial help from the feds. We have just voluntarily renounced hundreds of millions in revenue from a tax increase which Ball could have blamed on someone else, but accepted as fiscally necessary. The gods of finance help those who help themselves.

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  3. Not that there was ever any doubt,but Ed was, and remains, the real premier.

    Just as that land speculator is the real mayor and council in Town.

    NL is officially a kleptocracy. The only difference from Russia is the size. The relative scale is the same.

    the titular premier already is a deer in the headlights. He, like dunderdale and Davis before him, is expendable. He will learn that the hard way. Soon.

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  4. What will happen when the budget comes out and wages are frozen and cuts are made and Nacor is given another few hundred million dollars? I can see strikes like never before in NL. Why does the government continue to build MF? Power will costs will double and increase every year for fifty years. If construction is stopped now, what have we lost? Least cost option? what a crock. I just received my power bill for November and the kwh rate was the same as it was in 2010, this is because the PUB eliminated the 13% increase imposed in 2011 and 2012 claiming non existent high oil prices. The Liberal Party should stop this worlds most expensive make work project. Higher taxes and reduced services are far better than whats coming with Muscrat Falls.
    Gerry Goodman

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  5. Why are so few people listening? While there is a lot of technical data, you still have managed for the most part to write your articles so the average person can understand them. Are they just not interested? Will they wonder when the proverbial fan is hit, why no one said anything?

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