Thursday, 29 August 2019

OPTIMISM IS NOT A PLAN: ADDRESSING NL'S FISCAL CRISIS


Editor's Note: What follows is the text of my remarks to  St. John's  Rotary today titled "Optimism is Not a Plan: Addressing NL's Fiscal Crisis". I am truly grateful for this opportunity. - Des Sullivan

Ladies and Gentlemen:
Firstly, I want to thank Rotary for inviting me. Let me also acknowledge your work supporting an array of projects and commend you for offering an essential platform from which to air important public policy issues.

Having been an intervener at the Muskrat Falls Inquiry with Ron Penney and your fellow Rotarian, David Vardy for the past year, Muskrat might have been an obvious subject for my remarks today. However, a desperately larger issue looms over us…the Province’s debt and deficit which, of course, is inseparable from the Muskrat Falls Project anyway. 

The "direct" debt is nearly $14.0 billion. The $12.7 billion borrowed for Muskrat is assessed by the Budget Estimates as "self-financing" – a euphemism used to disguise reality – when the requirement for “rate mitigation” implicitly gives some of this debt the status of “sunk" cost. Add the public sector pension deficit and the Province's recent dalliance with P3s, essentially an off-balance sheet form of financing and those debts easily put the Total Direct Debt in excess of $20 billion. Who is surprised by Moody's downgrade?

I have titled today's remarks: “Optimism is not a Plan: Addressing NL's Fiscal Crisis”, and with good reason. In June, the House of Assembly passed the seventh deficit Budget in a row that substantially exceeds a billion dollars, if you include the Capital Account. This year, the Current Account deficit alone, on a cash basis, is roughly a billion dollars.

The numbers reflect a growing, predictably insurmountable, financial problem for our economy and society. Given mostly good intentions from successive majority governments, the new minority government era offers even less hope for budgetary fixes.

Optimism alone doesn't work well on fiscal discipline any more than it does on weather or the price of oil. Optimism is not a plan. It should, however, inspire confidence in a plan, if it is sensibly created - but we need both; confidence and a plan.

Outside of government, the typical response of businesspeople is that offshore oil will resolve our budgetary woes.  There are some bright spots to be sure such as Bay du Nord.  But the realist will tell policy advisors that at 300 million barrels recoverable, it is a marginal project raising the probability that it will not get sanctioned at current low oil prices.  Besides, even '2025 first-oil' means an additional 7-9 years before any appreciable royalties from that project enter the Treasury. 

Oil Projects are a 20-year development in this province.  Any new success with the wells now being drilling will not account for royalties for decades.

Make no mistake we cannot continue at near $1 billion operating deficits. Oil is not a magic pill. Neither will Alberta provide the lift that we can't.

That said, the Minister of Finance clings to the claim of Budget balance in 2022-23. It should count for something that Moody’s thinks the goal "highly ambitious" - their euphemism for "never going to happen". 

This is not a new discussion. But, as citizens, shouldn't we wonder when action will replace well-intentioned chatter? 

Admittedly, it is not as easy as it sounds, especially when there is no more room to tax; and cuts are certain to cause disruption to programs and services. But if governments won't act when the whole society is transparently imperilled, whose influence on them will prevail?
It is tough to expect ordinary people preoccupied with balancing household accounts to get their minds around the implications of a $20 billion direct debt. But I believe that they will have to. Why? Because no one else will.

You might ask: Where have the traditional players disappeared? Why are our institutions so incredibly mute, including the University which will have its own crisis to manage? Where is the voice of business and the professions - many of which have profited from a decade of private sector investments and excessive public sector spending? Why are they so quiet when the perils are so large?

Intellectually, most of us know that neither inflation nor demographics are on our side. The younger members of our society are more mobile than ever.  The great outmigration of the 90’s ensures that current Newfoundlanders have extensive networks in the rest of North America.  They will not stay here to face an increasing tax bill, an uncertain future, or a poorer standard of living.  A new wave of out-migration threatens.

Many people await a "quick-fix" to our decade of fiscal irresponsibility that does not exist. Hence, the question: What will we do when doing nothing is not an option?  Who will provide the leadership?

Let me offer this perspective.

 During my years on "the Hill" in the 70s and 80s, business could be heard saying that government could do nothing right, boasting that they could do things better, faster and cheaper.

But, by the early 2000s government incompetence evidently had resolved into management prowess and efficiency. Where once they couldn't get credit for building a good mile of road, government was suddenly thought capable of building multi-billion dollar megaprojects.
Was this change bolstered by new competencies? I don’t think so. The only noticeable change was the requirement that we all believe. "I believe in NL" ran the refrain of the PR campaign headed by the Board of Trade's leading lights.  Was this anything but a default to populism to goose a business case for Muskrat that was completely fictitious? It is hard to arrive at a different conclusion.

The MF Inquiry has displayed for all to see that reasoned, fact-based decisions normally forthcoming from the public service have been replaced by the strong armed tactics of the Premier’s office. But the excessive concentration of executive power is not our only problem. Changes have occurred in the structure of our economy which are not a positive influence on public policy either.   

Worrisome is that so few people in our society are willing to ‘speak truth to power’. It is a fact that aligns with the “franchised” business era which has long been gripping economic change. This change not just diminishes local power and the number of local people with 'skin in the game', the real owners of the capital are national or global and they could care less about local social, economic and political structures.  Evidence is found in the fact that 95% of those who control the goods coming into the province are mainland companies; less than 5% are controlled in NL. This is not a commentary on globalization as much as it is a statement about the need for the people and institutions within vulnerable societies to adjust. Consider this reality:

The "franchised" economy is not just manifest at the Avalon Mall, Stavanger Drive or on Kelsey, nor just in how banks or oil companies are managed. It is found equally in how law Firms, Accounting, Engineering and Architectural Firms operate. Even our labour Unions have become franchises.
Within this structure, no one doubts where the capital or the power and decision-making reside.  Like the power within governments, power has shifted to centralised executive offices. Business, the professions, unions, and others can pretend they still have clout, but in fact their power has been cashed in and is now under the control of some else's joystick. In a society historically deferential to authority, the implications for public policy should be obvious.

Let me be clearer.

Will the CEO of Costco discuss possible spending restraints with the Minister of Finance? Will the nearest Exxon or Husky V-P or those who run Walmart, Burger King or Loblaws think it their civic duty to lecture the Premier on the merits of fiscal discipline? Will the lawyers, engineers and accountants whose major ownership operates from some distant backyard feel similarly obligated? In an economy heavily dominated by public spending, will outside ownership even allow the locals to bite the hand that feeds them? Those questions expose one dimension of NL’s problem.

There are others, one exposing the fact that our concerns over public policy shouldn't be limited to the deficit or Muskrat. Consider how easily the province capitulated to the Federal Government's pursuit of Bill C-69, weakening in the process the core principle of Joint Offshore Management and one of the province's tools of fiscal repair.

Why do we still feel emboldened to defer to a Federal political agenda - one that lets every self-appointed environmental critic from here to B.C. have a say over the development of an industry that is fundamental to our economic survival?   Make no mistake Bill C-69 will only add more time to the 20 years it currently takes to develop an offshore project. Does the Trans Mountain Pipeline increase your confidence that federal involvement in oil will be the short-term answer to our fiscal woes?

The point to be made is that political weakness permeates far too many spheres of this vulnerable society and as much as some think that business and the local elites control public policy, I suggest that that ship sailed long ago.

Political leadership is a problematic issue. Equally, when traditional power structures don't have the power to rebuke the politicians when they shirk their role, it means that preserving our society and economy falls to us as individuals.  As individuals - not as businesses, unions or some other commercial entity - we are the ones who must make our society work because no one else will.

Mike Tyson was once heard to opine: "everyone has a plan until you punch them in the mouth".  The metaphor may seem crude, but it is worth asking: is our Mike Tyson Moody's or DBRS or a Bond Market freeze? Is a knock-out punch a pre-condition to addressing fiscal drunkenness before we are girded into action?

What of solutions?

A good place to begin might be to start thinking of politicians less as deliverers of every district's share of the fiscal pie than as legislators having a public policy role. When we dampen political parties' ardour for unbridled spending because their tool kit contains the easy choice of seemingly limitless borrowing, rather than the requirement of making policy choices, we will have made a good beginning. Our challenge may be that we have to figure out a way to tie their hands forcing them to make those choices.

Secondly, if the Government is serious about Budget balance in 2022-23, they won't mind showing us each year's target until it is achieved. As citizens, we have the capacity to distinguish between fact and fantasy. We should see the Plan for ourselves and have time to assess it.
Thirdly, our vital interests as a province are inseparable from control of our resources - something that has become confused with the high-risk development role that now excites power-brokering bureaucrats and politicians. We easily forget how tough it was to win the Atlantic Accord. We need a return to those issues. Watching silently as hard won powers are diminished is self-destructive and it must stop.

Fourth, let's put an end to public policies that give rise to monolithic Nalcor-type entities, their unfettered power and access to the public purse beyond anything, I suggest, the Legislature ever contemplated. Given the damage done by Muskrat, the idea that slitting off the oil and gas side, rather than selling it at an opportunistic time, seems terribly unwise. As politically sexy as those decisions seem, politicians forget the financial risks they pose.

Bay du Nord, for example, offers miniscule local benefits but there is much ado about having taken a high-risk equity stake in the project. No differently than Muskrat, those investments do not represent government's core competencies and may be in conflict with what we expect to get from our resources. I believe that they only represent further proof that Government has lost its way.

Fifth, in stating that our fiscal problems require a thoughtful, planned and disciplined existential response, I am aware that individuals can't reform health care, the ferry system, or excesses in public administration. That's the job of governments, their bureaucrats and consultants. But everyone understands excess, including laypeople, and can help define the outer limits of both spending and borrowing. If ordinary people, overnight, can force Parks Canada to remove an unwanted fence on Signal Hill, using social media platforms and direct messages to their MPs, the same can be used to give spine to the Finance Minister and the Premier, too.

What else can we do as individuals? We can and should support Government's best efforts when they are sincere. When they are not, we should demand better.

Finally, if Government won’t lay out its plan or believes that it cannot garner public support for the one they want to bring forward, I suggest that we all get behind an idea first proposed by one of our finest citizens, Edsel Bonnell.

Worried about our fiscal condition, he wrote the Telegram in June, 2016 proposing, as first step, that the “Legislature...establish a Task Force which would focus solely on our fiscal and economic challenges…” He proposed as Step 2 that the House be “called together for a special session” and involve all members and with no other business on the agenda except fiscal issues and the economy.” He suggested that unanimity might be achieved without party discipline or caucus strategies, and that such an apolitical (and “historic”) event could create the mandate for the Task Force which would be "responsible to the House as a whole”.

In steps 3 and 4 he laid out other ideas suggesting that the Task Force comprise our best and brightest citizens in various disciplines, that it fundamentally involve the people and organizations of the province. Ultimately, it would create a long-term strategic plan to deal with the debt to which everyone could buy in.

In 2016, I didn’t think that Edsel’s plan was workable. I have since come to the view that, realistically, it is the only other viable option because it is a process that will involve legislators and individual citizens on a non-partisan basis. It is time, therefore, to revisit Edsel’s initiative.

Am I optimistic about our chances of success? I am. Right here at Rotary I see people of action, volunteers offering themselves in the cause of public service - the Rotary Sunshine Camp, Pottle Centre, Geraldine Rubia Centre, Elaine Dobbin Centre for autism, are just a few examples. The Province needs people like you, prepared to volunteer their time, to give the best of your talents in the pursuit of good public policy, too. Right now, we need people with the ability to leave aside partisanship, people with  the desire to find ways to address our fiscal and economic plight.

As Newfoundlanders and Labradorians we know challenge; we have faced plenty and I believe we can do it again, knowing that we have to do things differently. It’s the belief that each and every one of us will leave no stone unturned in this endeavour that sustains my optimism.

Thank You.

52 comments:

  1. Any workable plan would be very very ugly. It would be like removing the bird feeders in January when thousands were dependant upon them.

    I am not optimistic. We have a half a million people, and 100,000 of them are over the age of 65. Unemployment is about 15%, we have massive debts, a criminal 12 billion dollar hydro scam and a completely dysfunctional public service. The age 0-9 age groups are rapidly shrinking, so massive population decline is on its way.

    We will have a huge health care burden with 20% over 65 years old and we have many billions in deferred maintenance in our buildings and roads. With no money to fix things, we are signing billions in contracts for public private partnerships.

    Where would you even start to fix such a mess? People are just hoping the status quo lasts a little longer before it all goes to hell.

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    1. Well said. GET OUT WHILE YOU CAN !!!

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    2. Levy, you keep repeating the same message. When are you going?? Or are you already gone, or scared to go???

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    3. Des says he is optimistic. He must be to continue this blog and push for improvements without apparent reward, besides getting the Inquiry and exposing the rot.
      I read yesterday of a long term study as to the life span for people who are optimistic or not. Here is the results;
      Being optimistic adds about 11% to the live of men and almost 20% to the life of women.
      If one assumes average life for men at 75, this adds about 8 years, so good to 83
      For a woman if average is also 75, this adds about 15 years, so good to 90.
      If other factors are favourable, these may reach 100, it seems to me.
      Moral : Keep it up Des, and Dave, it adds to your life, what a better reward?
      As for Levy Payer........who says get out while you can......you have been saying that for years , but you're still here, ....but not for a long time maybe?
      Winston

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    4. Hey Anon 21:01
      Levy Payer and Anon 16:51 only speak the truth
      NL will become Canada's newest and largest National Park
      Jumpin' Geewillikers, it may already be

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    5. Actually you mean USA National Park. Talks are already underway with Trump.

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  2. Seems like I remember the St. John's Chamber of Commerce publicly expressing concerns about the Government's decision to offer a no-layoff deal to public sector unions. Jerry Earle was quick to say that businesses should mind their own business and started a public campaign to hurt any business who didn't support the goals of NAPE. So much for constructive public discussion to find solutions. The NL government is politically controlled by union interests who openly leverage the government using the unions' voting numbers. Despite union propaganda, they care nothing about anything other than themselves and their actions have clearly shown this. Any union that pushes for no layoff when seniors are having their modest government support cut should be ashamed of themselves. The economy is shrinking in NL, unemployment is rising and the government has made practically no progress to lower its spending. NL private sector workers and businesses, with nearly a 60% increase in business bankruptcies this year, are being crushed by the weight of taxes and fees levied by the NL government. Looking at this gong show, who would want to stay here unless you are a politician or in a public sector union? If you are young and want a real opportunity to realize your potential, you MUST leave this province. Advancing through merit and hard work is not a part of the culture here anymore. Opportunities are far better in central or western Canada, or in the US.

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    1. seems to me that I can never remember the St. John's Board of Trade voicing opposition to what is the biggest spending debacle in our history because it bennifitted their members soley. The business community in NL is no better than the unions in that they only care about money thrown their way.

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    2. If you knew much about MF, you would understand how stupid your comments are. NL companies in general received practically no commerce from MF. The big players on the project were Astaldi and Andritz Hydro, both with head offices in Quebec. Pennecon of St. John's was probably the biggest NL company on MF, but their presence was tiny compared to Astaldi or Andritz. These Quebec based companies did practically no business with NL companies. They dealt wherever possible with Quebec based vendors, service providers and subcontractors while NL companies were mostly left out, not even given an opportunity to bid on most opportunities. The Quebecer's who came to MF to manage work for Astaldi or Andritz commonly referred to people from NL as the "stupid newfies" because we so easily gave away the commerce on MF to Quebec companies. The real irony in this is that the private sector (businesses and those who work in those businesses) provides the tax base to run this province. This same group received practically no benefit from MF and now is expected to fund the irresponsible spending of government through increased taxes and fees. It makes for a real good newfie joke.

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  3. Why are our institutions, including our university being so mute, asks Des. Are they controlled by outsiders like Costco? Are they so dependent on Husky, Emera, Nalcor and others for donations for research etc, for the benefit of those companies, that effectively they are controlled largely by outsiders? Yet 300 million a year subsidy is from the public, and they have a 400 million maintenance backlog, and do nothing to moderize their buildings for efficiency.
    Where is the leadership from MUN? Why do we need Harlow expense? Did Joey need to bring over Lord Taylor? 2500 dollars per year average each family must pay to cover that subsidy. Money well spent?
    Winston

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    1. Winston
      Aside from MUN, North American universities rely on the bulk of their funding from endowment funds provided by well-heeled alumni.
      Your bigger question should be why don't MUN's far flung alumni provide funds to their alma mater

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  4. Good luck with that ol' buddy... the dodgy skeets and inept dimwits comprising the NL politico will ensure this remote sub-Arctic shithole remains destitute.

    The best bet is to try to get the dimwitted Newfies out of it and turn it all over to a board of retired Norwegian civil servants, fisheries officers, and petroleum executives.

    As long as those fuckin arsehole Newfie politicians are involved in it this place will remain royally fuckered.

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    1. Now boys, here is a guy with a plan. I say we elect him CEO, or maybe just premier.

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    2. Indeed but have we not seen the plan before...

      Step 1 - rage
      Step 2 - demand handouts from others
      Step 3 - claim there is more than enough gold in the ground if only we commit to dig a deep enough hole to find it
      Fail and repeat, substituting a new harebrained scheme at Step 3.

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    3. Nooooooo boy, we got the Norwegians doing it this time. The same crowd that wants to get oil from the Flemish pass.

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  5. Seems the reservoir was at 36.1 M last nite and the same now, and maybe not reading in real time at present, as if stuck for the last 10 hrs, or stopped intentionally I wonder?
    If a pause on filling it should have shown some horz movement on the graph, but that is not the case.
    A few more hrs and see if it changes.
    Is Bruno on holidays?
    Winston

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    1. The chart does show to 8;30 am, and from other locations it seems the filling continues.
      WA

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  6. The situation is even more bleak than indicated. Uncle Gnarley has not adequately accounted for the desirable implementation of limits on oil production in the coming decades. This is not an outlandish concept. The Economist has advocated for this, on the basis that global plans for oil production and exploration will result in more CO2 in the atmosphere than is good for humanity and ecology. The continuing development of oil that is advocated here, even within the limits Uncle Gnarley describes, is hardly a good thing. So, a little more honesty and candour is in order on this aspect of our economic and social conundrum. As usual, NL in its thought patterns and policy determinations is behind the curve. this could cost us.

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  7. NL private sector workers and businesses, with nearly a 60% increase in business bankruptcies this year, are being crushed by the weight of taxes and fees levied by the NL government. I believe these idiots think they can tax us into prosperity!! Going to look like Venezuela soon. Young people who are trying to get ahead will find it is not possible unless they are part of the merchant class. Time to get out!

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    1. Yes, lots of business started up on the make work project...muskrat..but we al knew that would be short lived. Increases in bankruptcy is the result of muskrat...higher taxes, fees and unrealistic expectations. Gotta have the best, and all at once, big new house, bigger truck, two cars, cycle, oh yes boat to get me two days on the water for a cod. Some have taken a lifetime to try and achieve that, and not there yet.

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    2. I just managed to salvage an historic artifact, that was put out to go to the garbage: a horse slide built around the 1940s or early 50s, originally owned and probably built by Uncle Matt Clarke from Upper Island Cove.
      It has much iron work for strength, done by a blacksmith I expect. Support parts of the wood from tree root area where the grain gives much strength, as used too for building punts.
      In the 1930s and 40s men from our area would travel about 15 miles, gone from daylight to dark to return with a load of wood that would last but a few days. The Nlfd pony and horse slide now replaced by 4x4 trucks , and quads as recreation vehicles, now heating by electricity, oil, propane or heatpumps, and everyone complaining about power rates, and get sick from inactivity and 50 lbs overweight.
      At times in winter when people were sick , these horse slides took people miles to reach the train station to go to hospital.
      The heavy sturdy slides were also used by kids as few had sleighs even in the 1950s, so 5 or 6 kids would push these up hill for a ride down. I was one of those kids.
      I recall once the main road blocked for 2 weeks after a snow storm, and a path shovels for 3 miles from UIC to Spaniards Bay, and then a horse and slide went through, and after a few days that path seeing more traffic of horse and slides, some horses with bells.
      So yes, now Nflders expect everything quick, and go in debt to get it. Most know not what a sculling oar is. And few cared that billions were borrowed and wasted for MFs.
      Winston Adams
      Restoration work is needed.
      Winston

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  8. https://pv-magazine-usa.com/2019/08/29/indiana-gas-plant-spurned-wind-solar-and-storage-respond/

    Wind/solar/storage is moving from a trickle to a torrent. Overcome politically the Nalcor monopoly on power. Build wind/solar/ slowly as MF continues to drain the treasury. Next step off Nalcor and sell the oil interest at a good time (that may have been yesterday :<)

    You expect politicians to practice yearly fiscal practice of discipline....practice?......practice?....practice???? (my best Allen Iverson impression).

    If you collectively fear calling out the plutocrats in every sphere of life, by name with every encounter as in... "You are one of the greedy nitwits that ruined life in this beautiful place for generations! I hate you For "teabagging NL". You all now who the bastards are, shame them in every social interaction. It is time for open rebellion by the working class and time to revive chants like; Up The Ass of The Ruling Class!

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    1. "You all now who the bastards are" should have read "You all know who the bastards are"

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    2. Very good and entertaining prose, Bruno.
      But the trickle to a torrent thing:
      The piece on the 400 MW solar project in Alberta says solar is only 1% of Canadian power supply. A torrent?
      Battery Storage......a torrent? Much like solar .
      Wind, a little better and much more economic for Nfld than solar and storage, but even so only 2 % in Nfld. Ed Hollett discounts it, but you, I , and Stan Marshall sees it as a lost opportunity. Wh to blame? Nalcor and Hatch, maybe Nfld POWer and Fortis for being under the cone of silence. And blame MUN engineering too.
      These renewables "is moving from a trickle to a torrent" you say
      Some places they are stopped dead, not moving, some places they move at a snails pace. Some places, on a little slow trot, but where is the torrent? Too little too late maybe, not keeping up with the expansion of CO2 and methane emissions.
      Enough said, I must go check my thermometer,see if it reads trickles and torrents.
      Winston

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    3. So what do you make of this?

      https://www.cbc.ca/news/canada/british-columbia/trudeau-horgan-surrey-announcement-1.5264467

      Not only are Canadians on the hook for the TMX "Boondoggle", now the Fed is driving Site C dam to generate power to subsidize the Gaseous boys too! Are there any Liberals considered electable in NL? and for this?

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    4. This is a 40 billion LNG project, 10,000 construction jobs,and use some hydro power to reduce GHG they say. So all the LNG goes elsewhere and the same planet. As I said renewables can't keep up with emissions increasing from fossil fuels.
      0.450 billion for the Alberta PV solar plant and 40 billion for LNG, which is trickle and which is the torrent, in terms of investment?
      Winston

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    5. Please investigate the meaning of TO.. as in TO a torrent.

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    6. Looking for which is the torrent, in terms of investment? See ACB.TO

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    7. ABC is the weed supplied you mentioned, data from the stock anaysis show:
      This stock took off and hit a "high" of 16.24 this year before the drop. It was 12.67 in March . Presently trading at 7.34
      Some rate it as still a moderate buy, that it may go to 9.00, but Zacks who has a rating range from #1 (strong Buy) to # 5 (strong sell) rates ABC as # 4 (sell)
      It pays no dividends as it makes no profit. It's EPS (earnings per share) is -0.16 per share, it's net profit margin is -243.08%
      The CEO does well, at about 1.8 million total compensation.

      I consider this stock highly speculative.
      Yes the stock price went from a trickle to a torrent increase, then the dam broke and it was a downhill torrent.
      Hope the reservoir don't follow this trend due to the North Spur, if it breaks.
      Based on your recommendation of ABC as an investment, what does it say as of solar and battery storage for Nfld ratepayers?
      By the way, Tesla solar division installed solar on 240 Walmart stores, 7 of which caused fires and Walmart now suing for damages to their property and merchantise. 3 % causing fires is significant, and maybe other makes are better? Solar is good and cost effective in some locations, but has some problems.
      Are you ready to quantify risk to NSpur failure, a guess even?
      Seems all now trust Nalcor?
      Winston

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    8. TORRENT: a large amount of water that is moving quickly, especially one that is uncontrollable.
      Torrent: the after effect if the North Spur breaks.
      Risk of torrent: when the dam design and operation may be be insufficient, lacking best practice for the site conditions.
      To Torrent: moving in the direction of a torrent.
      Winston

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  9. Censorship has many forms, got to love it!!

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  10. I do think the elevation is shown frozen at 36.1 M since past 24 hrs, but is still increasing and not being displayed. It is not making sense, is it?

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  11. Right on UG, my cry for a plan surfaces, maybe now someone will start one. It doesn’t matter if it works or not ss long as a plan is started. Any plan.

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    1. Planners, (and Engineers), are generally considered dangerous and a threat to politicians, and their Masters. Municipal Administrators, for example, keep them squirrelled away from the Public, only to be let out to do menial tasks. Any Plan as you say Tor, would be better than none.

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  12. Saskatchewan moving at snail's pace towards electric vehicles;

    https://www.cbc.ca/news/canada/saskatoon/sask-electric-car-drivers-1.5266641

    Can anyone yet find a Canadian car rental based on electric vehicles?

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  13. Here is a plan that would work:

    Identify via interviews, the key individuals in every government organization and department that keep things going and/or who are wise. Employees can usually tell you who these people are and there usually a consensus. Take these people from their current jobs and put them together as a team a year or two with the goal to set up all the operating procedures and organization structure to provide the basic, essential services of each department. A list of basic functions needs to be made public - e.g. some standard of literacy, classroom size, what portion of highways are gravel or paved, the average wait for a family doctor visit, ferry service (or lack thereof) etc. Every service should have cost metrics - cost per head, cost per family, cost as a percentage of all spending. This is needed so that the public sees a method to the madness.

    Once we have the list of basics required to survive on the island and the required organizational structures and procedures, develop a complete and detailed budget. Work it top down, then bottom up. Once we know what is required to have a sustainable (and basic) public infrastructure we will also have the revenue requirements. If there is clearly not enough income (e.g. the debt service alone is equal to the cost of education) then radical solutions are required. Default for example, followed by negotiations with Canada or even others. Would China invest here to have a port between North America and Europe? Everything should be considered.

    In any case, this budget will be far smaller than our current budget, and we should on average, never spend more each year than we receive in revenue. Large expenditures should require a referendum.

    In order for such a plan to work (e.g. empowering the civil service to fix the mess) it has to have support from the top. Unfortunately, the managers/directors/ADM/DM are mostly inappropriate, politically connected, lack the required skills and often just pathetic. Many of them are also sociopaths.

    So the first step would have to be a new political party with good people. Then, after a purge of management and proper public competitions for the competent people, the business re-engineering could begin. While outside consultants might help, generally big accounting firms simply send in recent grads as change management consultants that have no clue about the business. The real knowledge as to what is really needed in education (basic curriculum, larger classes ok, distance education for remote locations, emphasis on parental involvement and expectations, mandatory homework etc.) already exists in-house but thwarted by the status quo.

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    1. Anyone want to add to the plan above? List of entities that should be sold (e.g Liquor corp), a reasonable lower limit for a complete school (say 9 children), balanced budgets by law, all unicorporated areas to belong to a default municipal area, how we should handle unfunded mandates -- e.g. that all small communities have sewage treatment facilities despite the fact that they can't afford the infrastructure.

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    2. With 20% of the population over 65, what can or should we provide for old age care? Should everyone that needs it have a room? What should it cost? Should it be shared? How many in a room? Should family be expected to look after their elders (and provided with some financial assistance) so they can age in place?

      The worst and most stupid option is to spend billions on 30+ year or P3 contracts to handle the peak. The baby boomers will have moved on before the contracts expire leaving empty facilities. That, and public private partnerships (P2) are almost always a very bad idea in retrospect.

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  14. The MFs reservoir should be completely filled by Sept 5 based on their website data:
    On Aug 28 it was at elevation 35m and to fill at the rate of 0.5 m per day. Another 8 days to fill the remaining 4 m to elevation 39m gives a date of Sept 5.
    This seems a rather aggressive fill rate given the prior information of to be complete by the end of September.
    Is this a best practice safe rate?
    Winston Adams

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  15. ACtive planning discussion going on, wow!

    We have the coalition, make it a committee or think tank and pitter patter let’s get at her!!!!

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  16. Perhaps it is a good time to enlighten readers on Bruno's long involvement with Muskrat Falls.
    In March 2011 there was an environmental panel hearing at Goose Bay. In the evening the chairman said " We do have a lot of time for questions, which people in the audience have questions? (There is no indication from the record of the number in the audience, but the chairman says : Mr, Marcocchio?)
    "I'm Bruno Marcocchio, of the Sierra Club" Bruno says.
    Bruno asked a question, and the record shows Gilbert Bennett was on the
    panel and at times made answers and questions.
    Mr Clarke, the chairman, soon wants to defer Bruno questions to another time slot. To this reader, it seems Bruno questions were not that welcome, the questions were uncomfortable to them. This was to do with environmental impacts. Indeed, much of the presentations was about the Gull Island project, with slides and detail, and less with Muskrat.
    Eldred Davis too had concerns: about reservoir filling.
    Gilbert explained that with the MFs spillway in place "we can modulate the flow...to deal with a downstream situation...if we see anything we don't expect....we have very good control....to mitigate"
    Davis didn't agree with Gilbert. ,,,,mentioning salt water problems at North West River following the Upper Churchill operation.
    ( In hindsight, the following year, 6 hrs before the flood of Mud Lake on May 17, 2017, Gilbert dismissed concerns raised by another engineer, of imminent potential problems,saying all would be fine, despite rising water and possible ice jam downstream. Soon the water at Mud Lake was life threatening, at levels never before seen.!)
    At 8;22 PM the chairman called for a break and they then resumed for another expert to speak: from the Geological Survey of Canada.
    Winston Adams

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    1. The experts from GSoC would speak on seismic hazards and fluvial geomorphology. Dr Lamontague would go first and speak on seismic hazards, ground motion, reservoir triggering seismicity (called induced seismicity), risks, uncertainities and recommendations.
      This expert stated he also teaches this subject at a university, and started by asking "what is a fault"?
      WA

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    2. The experts explains: Faults are fractures in the earths's crust, from recent or ancient earthquakes, which is a motion under pressure, under stress. Instruments can record it, we can feel the vibration if it's strong enough, and it can cause damage. On the Richter scale, a 5 will be a fault about a km long, an 8, hundreds of kms long, a 4 about 100meters long, a 3 about tens of meters long. Usually below 5 there is no damage.
      Shaking must be included in engineered structures, buildings and certainly dams, which is our case.
      95 % of earthquakes occur along plate boundaries. Here we'e right in the middle of a plate, the Canadian Shield, a stable environement where we do get small earthquake, but here it's fairly stable. We can define earthquakes by a seismograph recording, which started about the year 1900. Now we can detect even tiny ones,but those over 3 we can detect throughout Canada, and small ones where we have more recording stations.
      The National Building Code , we can define a seismic hazard at a given probability level. Dams require SPECIAL studies because they require LOWER probability for rarer earthquakes than what we do for normal buildings.
      Winston

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    3. The expert continued: We can see the evidence of faults 7000 years old and younger, older than that were eroded by the glaciers.
      Landslides can be caused by earthquakes but also by erosion.
      Finally we have liquefaction, when sands in the subsurface is filled with water, which comes to the surface with strong ground motion. These liquefaction are specific to earthquakes and that's why they are PPOWERFUL, in more or less knowing about the earthquake activity in a region, so they are GOOD EVIDENCE.
      Also we talk about reservoir triggered seismicity .....that large reservoirs CAN trigger earthquakes. What happens when you create a reservoir, if you have a fault that is permaeable, where the water can seep, it creates a film along the fault, and it can give rise to small earthquakes . We call them reservoir triggered earthquakes or seismicity. It's not so much the weight of the water but you're added water along the surface of the fault and it can lead to small earthquakes.It's nature, we don't have enough control to say in advance. Worldwide there's been some damaging earthquakes triggered by reservoirs that's documented.
      In Canada, there 5 documented cases, all in the Canadian Shield of Quebec: Manic -3; Sainte Marquerite; Toulmustouc; and 2 at James Bay reservoirs.
      Winston

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    4. The expert continued: the largest ever triggered was in Quebec, at 4.1, to Hydro Quebec in 1975.It did not cause damage. It was a wake up call, because at first they didn't know exactly what was going on, and they monitored the situation, very closely and they have a good story what happened there, and from then on they monitored the seismicity in other reservoirs that were created. These earthquakes are fairly shallow, zero to 2 km of depth so close to the surface. So the history of Eastern Canads is only a magnitude of 4.1, the largest ever recorded. We have different maps for Canada for normal buildings for different frequency of vibrations. For tiny earthquakes the frequencies are higher, for larger earthquakes, the frequency is strong but low frequency. This kind of map is for probability levels, so this region is relatively quiet seismically. We don't expect a lot of activity .
      Along the St Lawrence River, there's more activity, some zones are particularly active, related to "normal fault" and also the Charlesvois area.
      And that's why in some of our comments we are saying" Okay, you have normal faults in the Lake Melville area" and that's why we said it would be nice to check very closely what these faults are saying in terms of past earthquakes because we saw that in the St Lawrence Valley.
      Known earthquakes were done by the Proponet for the two dams (Gull and Muskrat Falls), but it did NOT include the possible reactivation of these normal faults.Also it did NOT look back into prehistorical earthquakes....they are NOT documented at all because we don't have the knowledge of these possible earthquakes. Also the possibility of earthquakes triggered by reservoir was considered only briefly.
      WA

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    5. He continued: Generally the Proponent's work was good....but we have NOT received response to clarification of these normal faults I was talking about, and also the reservoir triggered seismicity. We would have liked to see a bit more description of how they perceive this problem , this potential problem.
      The neotechnotic reactivation of faults, we say the Proponent has NOT presented evidence to support on concluding that there is has been no seismic activity in recent geologic time.
      WA

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    6. The expert continued: "We support the Proponents conclusion that the RTS (Reservoir triggered seismicity) should be at frequencies well above the frequencies well above the natural frequencies of the dams and would be short duration because of the history of other cases in the Canadian Shield.
      So we don't expect large earthquakes and that they should be short duration and high frequency content and that the DAMS would not be EXCITED by such earthquakes, such a potential earthquake.
      However, the Proponent has NOT addressed whether a PERTINENT STRUCTURE, that is to say the OTHER INFRASTRUCTURE, may respond to these high frequency EXCITATION".

      Note , the capitals for emphasis is mine. Here they refer to the dams as the concrete dams of Gull and Muskrat.
      Other infrastructure, I interpret as meaning the North Spur, which they do not call a dam, but effectively is.

      Excitation frequency? Readers may recall my recent postings on RESONANCE, where small vibrations at the right frequencies can cause big disturbances in a structure or infrastructure, such as the North Spur. This expert seems to be saying the same thing.
      Here they call it it "excitations" ......same thing.
      This expert is saying the concrete dams likely are fine and low risk from excitation, so no resonance problem ......but what of the the other infrastructure.....and the elephant in the room ....the North Spur, yet he is not identifying it by name.
      Winston

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    7. The expert continued: NRCan(Natural Resources Canada) supports the Proponent's intention to use a seismograph network to monitor the small earthquakes that could be triggered and could occur naturally. So it would be nice to have a seismograph network to follow when when you're filling the reservoir, and then if there's activity that is detected then there would be some discussion about what could be done.
      It was done in 1975 by Hydro Quebec, when they saw that they slowed own the filling rate in order to more or less mitigate what was happening. So that's something to keep in mind.

      Question: Nalcor lists on their website the various instruments, detectors and sensors. No where does it mention a seismograph or seismograph network. The nearest one is in Corner Brook, as far as I know, and I suspect too far away to detect small earthquakes.
      Does any UG reader know if such seismograph instrument was installed at MFs or nearly, and any network to monitor and look for these events, for risk mitigation?

      Winston

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    8. And so we get his recommendations;
      1. additional field work to support the conclusion reached on neotectonic activity and seismic activity.
      2. Examine prehistoric landslides to determine if there's a possible link with paleoseismicity
      3.Confirm the Proponent will consider whether pertinent structures......so that is to say the other structures.....may respond to high frequency excitation.
      4. Confirm seismographs monitoring will start prior to and continue during impoundment at the reservoir and for a few years post -impoundment when reservoir- triggered seismicity is most likely to occur.
      5. Besides accelergraphs that are put in the dams to record strong ground motions, which is planned to do, in addition, we want seismogrphs that detect smaller earthquakes over long periods and record continuously.
      Winston Adams

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  17. Get ready NL for 50 rise in sea level.

    https://www.newshub.co.nz/home/world/2019/08/scientists-predict-16m-sea-level-rise-even-if-the-earth-stops-warming-right-now.html

    Three million years ago when temperatures were a few degrees warmer than they are now, the seas were 16m higher.

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    1. And so I built my cottage 75 ft above sea level and my house 400 ft above sea level. All of Goose Bay/ Happy Valley would be under water, so why worry about the North Spur?
      Houston,..... this planet has a problem, if you believe the scientists.
      Or this is a Chinese hoax, the Digger and Rex Murphy would say?
      Winston

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    2. That should read 50 foot rise in sea level. With the storm surges this would reshape most of your island and mine.

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