Thursday, 4 February 2021


When the Province’s dire fiscal position ought to be center stage in Election 2021, it  is not.

This is a place where, it seems, neither politicians nor reporters are willing to even describe the full extent of the problem.

A few days ago, Premier Furey could be heard saying that the “fiscal gap” – the difference between revenues and expenditures - is $800 million, when the correct number is around $2 billion. In the same breath, he added that the Feds had taken care of the initial debt payments on Muskrat Falls of $844 million – forgetting to note that they were only deferred.

The great majority of people likely have no idea how high the public debt has grown or what it means to have debt beyond our capacity to pay. They do know, by and large, that we are in financial trouble; otherwise, there is widespread confusion. 

On the other hand, few who know better would put their hand up and tell Furey, Crosbie and Coffin to cut out their nonsense. While the Employers’ Council is showing Polling data offering widespread public support for measures to deal with the fiscal mess, where is the clamor of advocates for such change? 

In our society, anyone who vocalizes what the Employers' Council describes as reality, is guilty of heresy; the plaintiff putting one neighbour offside with another, a union member against their brother or sister. Business people, too, assume a strange entitlement to be exempt from criticism of the Government, lest they offend a paying client or interfere with a consulting gig or a contract. Local institutions, surviving on some part of the Government’s annual deficit, have the practice of deference refined.

Leadership can begin to resolve the so-called democratic deficit but that mindset – which requires change in how political Parties function, specific deficit targets, and legislation that prevents Government using debt to avoid making public policy choices – are not matters on any Party’s agenda.

In this General Election, as in the past, “bankruptcy” is an undercurrent not an issue. Such a lack of discipline is what gives rise to political dysfunction. Consider: NAPE, CUPE, NLTA and Allied Health Professionals, all have concluded collective agreements. A look at statistics from the recent C.D. Howe E-Brief entitled “The Rock in a Hard Place: The Difficult Fiscal Challenges Facing Newfoundland and Labrador, relates. It states: 

Healthcare worker compensation per capita in Newfoundland and Labrador between 1997 and 2019 grew by 332 percent. In the rest of Atlantic Canada, healthcare worker compensation per capita grew at 284 percent, compared to 228 percent across Canada as a whole. Direct provincial government employees also saw an increase in their total compensation costs per capita of 255 percent compared to 230 percent in the rest of Atlantic Canada, and a 197 percent increase nationally. In contrast, compensation per capita for educators has grown at a slower rate in Newfoundland and Labrador relative to the rest of Atlantic Canada.

This is an interesting picture of a public sector well compensated. Arguably, recent Collective Agreements (which include wage increases and job protection) only confirm that, in the face of an Election, there can never be room for fiscal discipline; politicians would bring the whole house down rather than place their electoral chances at risk. 

In case you have the slightest doubt, the C.D. Howe Paper confirms that “For the last 15 years, spending in Newfoundland and Labrador has… exceeded that of Alberta, the richest province in the country.”

The current platforms of the Parties indicate no preoccupation with a fiscal cliff either.

In a bankrupt Province, the Premier – supported by the other political leaders - can find an immediate $2 million for a Pet Scanner for the new $800 million Corner Brook Hospital that it does not need, forgetting that it in this very same healthcare system where deficit reduction must be found. 

Ches Crosbie will talk about “bankruptcy” but not in terms of any failure of political leadership with deferred consequences. For him it is a “ploy”, a “tactic”, as in a video game: lots of shooting with no blood. It sounds silly because it is.

The lingo the leaders use to emphasize the need for “jobs” has not changed either. Anyone who has reviewed the campaign literature or heard the Leaders Debate on Wednesday evening will receive a crash course in rhetorical drift. As to economic development, none has any clear ideas on how to give the Province a strategic boost, how much they think an effective plan might cost, or where the cash will come from.

Everyone knows Governments can pick winners and losers – just ask Danny Williams. Except on the hustings, it is always easier to talk about the success of “Verafin” than it is to commit to creating the conditions for another "Verafin", even a much smaller one. 

Penny-ante government programs inspire a response of similar size. 

As it stands, in place of an improbable low-tax, highly productive economy, the magnet of keen investors, weather not an option, this place may have to settle for resources like common sense, fiscal prudence, and willingness to change. Except that it is a pipe-dream with little prospect of becoming a boast.

Local leadership can play a big role; the problem is that they want an unqualified Government to do it all.

Ontario’s UNIFOR, for example, helped attract Ford’s $1.95 billion investment in electric car production. In contrast, TradesNL watched GNL hand over three hundred million dollars to the offshore oil industry, earning the commitment of not a single long-term job in return. If TradesNL talked to Husky/Cenovus Energy about productivity or any other issue, they kept it to themselves.

The NLTA leadership wants a lower pupil/teacher ratio, which means a bigger Education budget.

Dr. Lynette Powell of the NL Medical Association warns that 90,000 Newfoundlanders and Labradorians have no family physician. Her sector overspends by 40%. But even knowing where much of the inefficiency resides, the resolution of which might help physicians in rural areas, it would not come in their minds to sew some spine into Dr. Haggie’s corpus.

Doctor and janitor, the political culture is framed by them as it is by NAPE, CUPE, NLTA, just as it is by the politicians.

In short, this campaign – whoever wins – presages an inevitable outcome: When Moya Greene is shipped back to London, the Government of the drunken sailors will continue to party. None will dare threaten the status quo.

Unfortunately, the public – public servants, retirees, business, the professions, and our few institutions, too, are content to be participants in the charade.

That will work….until it doesn’t.

Then, everyone will find comfort in the knowledge that Mary Shortall is available to hold their hand.