NOT JUST EDDIE JOYCE; KIRBY AND THE PREMIER SHOULD GO, TOO

On Saturday the Tories elected a new Party leader. That’s nice. But will he lead? There has been no effective Opposition for at least a decade. Nor has leadership come from the Government benches over the same period, either.

When the economy is going well, business is booming and employment rates are high, leadership of all kinds — especially political leadership — is a commodity taken for granted. Governments play an important role in this economy, even if far too often it is with a negative effect. 

Perhaps it is in the nature of societies to think that things happen for no particular reason. 

Truth is, that’s rarely the case. 

The inability to lead, to be proactive, to have a nose for crisis, and to be willing to undergo the stress of intervention, is at the heart of the Liberal Government’s latest crisis, too.

TRUTH RUINS NARRATIVE FOR WILLIAMS, MARSHALL AND COADY

Life might be so much simpler if, like innocents on Christmas Eve, we would only believe.  

Stan Marshall, Danny Williams, Siobhan Coady — each one has a narrative that doesn’t fit with the facts, that can’t stand up to the scrutiny even of youngsters. Interestingly, the truth could easily favour Marshall and Coady, but they are unable to resist “spin”; other versions, supposedly, are more worthy of gratitude and acclamation. 

For Marshall, it’s this comment to reporters following Nalcor’s AGM: “Any megaproject in the world would be happy to be where we are.” Presumably, the CEO is referring to the progress made on Muskrat in 2017 which he, ostensibly, influenced. Problem is, he omits that productivity for its major contractor is still only around 22% (that's an average 2.2 hours of work on a 10-hour shift) and that much of this performance is related to poor management by Nalcor. Should we await another multi-million dollar claim by Astaldi?

HOW NALCOR UNDERMINES PUBLIC POLICY; BUYS FRIENDS AND SILENCE

Crown corporations are established for a multitude of political and public policy reasons. Most, ostensibly, fill market gaps in services and activities “ignored by for-profit private organizations” and therefore deemed the responsibility of government.  

A Paper by Philippe Bergevin on the website of the C.D. Howe Institute (from which the quote above was drawn) examines risks posed by the Crown Corporation model. It suggests that whether Crown corporations are “relevant” or if they serve only to “complement or displace private activity”, their policies should be limited in ways “to more clearly align them with the institutions’ core mandates and the defensible features of their economic rationales”.

THE INQUIRY: INTRIGUE IS WHERE YOU FIND IT

The Hearing Room, on the first day of the Muskrat Falls Inquiry, might have served as metaphor for the author Joan Clark, and her story of madness and altered perception in “An Audience of Chairs”. She would find plenty of sub-plots here, except that the madness to be assessed will likely have only a tangential association with delusion.

Even that assumption — as with all those that gave the project its silver lining — may seem excessive. Madness? Delusion? On this first day, at this Inquiry, at $12.7 billion and counting, we might wonder: who is asking? That’s because the audience was mostly chairs. The place was virtually empty, except for the usual bevy of blue suits and a few others.

SECRET “MANAGEMENT RESERVE” FOR MUSKRAT UNCOVERED

If there are still surprises hidden deep within Nalcor’s crumbling walls, recent information obtained by this blogger under ATIPPA has brought at least one more of them into the light. (Another is that the once-limp Muskrat Falls Oversight Committee is exhibiting serious signs of life!)

Documents obtained from the Oversight Committee suggest that Nalcor may have maintained a secret “Management Reserve” budget for a category of risk known as “Strategic Risk”. The Reserve was kept out of the estimates for the project and placed under the control of the “Gatekeeper”, presumably the former Nalcor CEO, Ed Martin.

Nalcor evidently understood that such an allocation had important budgetary implications for the project - and for their ability to sell the scheme. But its importance was too great to let the public know anything about it.

The fund was not revealed to the PUB during examination of the DG-2 estimates — or later. 
But, in addition, Nalcor also did not disclose any allowance for Strategic Risk in their DG-2 estimates, DG-3 estimates, or any estimates provided to the public prior to 2016.

Why would any category of project costs have been kept secret, or excluded?

A POET'S PLEA: WE NEED TO KNOW WHO SOLD THE FARM

RISE AND FALLS

Standing firm on guard for thee,

we coalesce to make our plea,

and while the horse has left the barn,

we need to know who sold the farm;

An enterprise whose smell pervades,

the waters and its everglades;

whose genesis just boggles minds,

while mares will watch their bare behinds;

ANDREW NIKIFORUK A SOULMATE FOR DAVID VARDY

David Vardy, a frequent contributor on this Blog, can often be found discussing how the failure of the Muskrat Falls project is symptomatic of a broken democracy. He met up recently with Andrew Nikiforuk, an award winning journalist who has written for twenty years about the energy industry.

A DEBACLE AND THE FEDERAL GOVERNMENT'S ROLE IN IT (Part II)

This is part II of a report chronicling Ottawa’s role in the Muskrat Falls project as both enabler and colluder with the Government of NL and Nalcor.  It discusses numerous areas, albeit briefly, where the Feds ignored blatant holes in Nalcor's business case for the project, each embodying the certainty of project failure. It also describes how they empowered Nova Scotia to control award of the Federal Loan Guarantee (FLG), failed to perform essential due diligence after the project was sanctioned and, inexplicable, failed to intervene as the project's price tag doubled for reasons it had an obligation to all the taxpayers of Canada to understand.   

FEDERAL COMPLICITY: THE UNTOLD STORY OF MUSKRAT FALLS (Part I)

This two part report chronicles Ottawa’s role in the Muskrat Falls project as both enabler and colluder with the Government of NL and Nalcor.  How the Feds empowered Nova Scotia to control award of the Federal Loan Guarantee (FLG) is discussed along with Ottawa’s failure to perform basic due diligence to protect Canadian taxpayers and reduce or eliminate the risk of default by the Government of NL. The articles describe the manner in which the Feds were complicit in an unviable project advanced under unwarranted assumptions. It also details how they refused to intervene as the MF project sank under gross management incompetence.  

Introduction
When the Government causes a catastrophe in our name, we are all collectively responsible. Such is the case with the Muskrat Falls project. 

In one way or another NL will pay for the debacle; just not the whole cost, because the accumulated provincial debt compounded by excessive borrowing for Muskrat has made our total debt unmanageable. We are effectively broke. 

But even if NL’s coffers were full, taking into account the role played by the Government of Canada as “enabler”  without whose guarantee Muskrat would have died in design, the Feds’ complicity in the sanction and its aftermath makes it a responsible party. The Federal Government’s actions, and often inaction, ought to be exposed.

BLOG NEWS: BARD MAKES BLOGGER BLUSH

BLOG DUES

Two million pageviews! Now that’s Blog news,

As Uncle Gnarley tries to clue

The uninformed and unenlightened

On NL matters, with a bite in.

One of few that truth pursues

On hidden facts and obscured issues.

A mighty task to dare to ask

For honesty, and to graft unmask.

Through constant fog, he writes away

To shine the light on unearned pay,

And always with a reasoned view.

To Des Sullivan, much thanks are due.

John Tuach

March 29, 2018

PAYING TWICE: CAN MUSKRAT GET ANY WORSE FOR RATEPAYERS?

Guest Post by David Vardy

Paying Twice for Muskrat Falls

Can Muskrat Falls get any worse for taxpayers and ratepayers? Yes it can get worse if we are forced to pay for it twice. That is the path on which we have embarked. 

The fundamental problem is that, once Muskrat Falls is accepted as part of the energy landscape, people will attempt to avoid paying for it by purchasing heat pumps and making other investments to reduce consumption of electricity. This avoidance and substitution is why demand for Muskrat Falls power will decline over time, perhaps quickly. Without a domestic market, export markets become the only avenue to generate revenues. 

In a normal world it is good for people to reduce demand for high cost power by seeking alternatives. It is good to conserve through more efficient heating technology. But in our upside down world it may be increasing the overall investment surrounding Muskrat Falls from $12.7 billion by perhaps another billion dollars.

THE BARD ON AVARICE AND COD FISH

CODFISH

When Cabot crossed the raging Main,

Cod in commons sight were plain.

But avarice - human greed

Caught King Cod to paltry breed

And Fish for food was sought in vain.

They said the Cod are back again:

Pre-spawning! - (3PS) catch campaign!!

Over grounds that Codfish seed,

An echo of the inane deed

Caused Newfoundland to pain.