THE GHOST OF SIR RICHARD WEIGHS: A BUDGET PRIMER

 When Finance Minister Siobhan Coady rises in the House on May 31 to deliver the Furey Government’s first Budget, it will be a test not of her resolve, but of the Premier’s determination to give NL the financial leadership that recent Premiers — from Williams to Ball — refused, or were incapable of providing.

This is Premier Furey’s day. The big question is: in place of leadership will we hear only echoes of NL history’s famed bad boy, Sir Richard Squires, whose Administration in the 1930s offered to sell Labrador for $110 million?¹ 

Hopefully, the Premier will be remembered for more noble reasons. Except, Furey has not yet made a single decision about anything important, so we will have to reserve judgment on this, and on his courage, too.

Moya Greene, notwithstanding the deficiencies of the PERT Report, essentially told the Premier that we have arrived at, in the vernacular, a ‘come to Jesus’ moment.

IS IT POSSIBLE TO ELIMINATE THE DEFICIT IN NL?

Guest Post by PlanetNL

PlanetNL33: Deficit Elimination? NL is Too Far Gone

A Pessimistic Interpretation of the Greene Report 

Moya Greene’s “Big Reset” Report, the final product of the Premier’s Economic Recovery Team, has done a dashing job of showing exactly where and how to eliminate this Province’s deficit plague.  Well done, let’s get started, right?  Not so fast.

Upon consideration of the underlying issues, the prescribed budget cuts and taxation increases will face insurmountable challenges.  It is clear upon second reading that Greene chose her numbers despite their improbability - she has developed a plan on paper that is impossible to deliver.  If this were a business plan submission, she has failed because there is no consideration of the many execution challenges.

The Report is not a failure, however, in the sense that it now makes our problem much clearer to see.  The financial state of the Province is well beyond any remedy that can be devised independently as a Province.  The Report does successfully show that insolvency is indeed at our door and there is no solution other than for the Federal Government to step in and help clean up the mess. 

Self reliance or Commission of Government? The choice is ours.

Guest Post by Ron Penney 

I don’t really think we will have the second Commission of Government, it will likely be some faceless federal bureaucrat in the bowels of the Confederation Building managing our finances. We may retain the fiction of responsible government with none of the powers. 

The Greene Report has for the first time added up all our debt and busted this artificial construct of net debt, mandated by the arcane rules of the accounting profession. The amount is staggering: $39 billion, $12.6 billion added in the past 12 years. And when the unfounded pension liability and other exposures are added in, it goes up to $47.3 billion,  $215,000 for each household in the province. 

Cash deficits have averaged $1.9 billion over the past 7 years. 

Who’s to blame? 

THE "BIG RESET": TIME TO WAKE UP. TIME TO ACT.

Summary

The PERT Report, titled the “Big Reset”, authored by Moya Greene, has been already greeted with derision by labour and others in denial. A public debt of nearly $50 billion seems still insufficient proof that the economy can never thrive by “spending our way to prosperity”. 

Let's face facts. NL is effectively insolvent. Greene’s proposal to lower spending by around $1.4 billion is a best case scenario - not the likely one; the likely one is far worse. When the challenge is so large, and the options so few, any plan of repair is devastating. 

Moya Greene can't be faulted for this; any deficit of her making lies in the fact that she wrote 338 pages and another 67 pages of executive summary to convey the team's ideas. Five pages of straight talk might have been more effective. As it is, the focus of the Report is diverse; some important issues are not addressed clearly enough. 

MOYA GREENE'S (DREADFUL) ECONOMIC RECOVERY (YOUTUBE) RELEASE

The only important thing that the public should do right now is become informed of what Moya Greene and the Premier's Economic Recovery Team (PERT) are proposing. That is why I am providing a Link to Greene's remarks. It is always better to hear it for yourself rather than through someone else's lens. 

I have only begun examining the PERT Report. So far, I  am disturbed by much of what I am reading. I am hoping to be able to wade through this blizzard of buzzwords layered with a misunderstanding of the social and economic impacts of the fiscal measures (cutbacks) proposed. On Monday I will offer my view of what, so far, I have concluded is someone's fanciful (green) version of Danny Williams' energy warehouse. Until Monday. - Des Sullivan

HOW SEAMUS O’REGAN HELPED WRITE FUREY'S THRONE SPEECH

If you were looking for an adage that perfectly describes the lost opportunity represented by the recent Speech From the Throne, it is this: “You cannot solve what you don’t understand.” Otherwise, think of the Speech as the new fairy tale economic narrative, "sunny ways", spun by the city-folk of Central Canada, with the inspiration of the PM. 

At the outset, the Address by the Lieutenant Governor, read at the start of each new Session of the Legislature, is commonly laden with regurgitated bureaucratese, rather than a strong message of intent describing the Government's "thinking" and its priorities. This time, while mercifully brief, the Speech was long enough to confirm that the Furey Administration has not a clue about virtually anything. 

It is fine to look for expertise from Dame Moya and her Committee, or to Dr. Pat Parfrey and Sister Elizabeth Davis. They are specialists on whom Government relies to define a path and help guard against the Administration going off madly in all directions. But when the Government embraces a version of Canada that is at best fanciful, offering no grounded view or recognition of the raison d'etre of the Province over which it governs, or why the economy is structured as it is, Greene, Parfrey and Davis are just swimming upstream against a current certain to drown their best efforts, and our essential livelihoods, too.