WHY WE SHOULD DISMANTLE NALCOR (PART I)

Nalcor is engaging in lay-offs at the Muskrat Falls construction site.  Undoubtedly, it will say this is a normal and recurring process, except it is known in some quarters the project is suffering low productivity amidst a typical Labrador winter, an unfinished “dome”, and inexperience just as its major contractor suffers a veritable turnstile of senior construction management.  

The Oversight Committee won’t acknowledge the fact yet; perhaps it don't even know. But, eventually someone will have to tell us the project is at least a year behind schedule and that cost overruns are worsening.

The saga of bureaucrats masquerading as entrepreneurs, in a business we can ill afford, plays out.  For whom does the ‘bill’ toll? As always, it tolls for thee. 

Having created Nalcor to pursue a foolish 'energy warehouse' mandate using public money, the Williams/Dunderdale Administrations have gotten the Province into a pack of financial trouble, especially by having sanctioned Muskrat Falls. 

Nalcor's mandate, of course, is far wider than even Muskrat implies. At a time when the House of Assembly is being de-constructed, ostensibly to save a few dollars, we ought to be looking for bigger fish; a place where serious money is being squandered.

Nalcor is one of those places.

"MINI-BUDGET” NEEDED; TIME TO DISMANTLE NALCOR

The Province needs a “Mini-Budget”.  The Government should commit to dismantling Nalcor, too.

Presently, the House of Assembly is engaged in a ridiculous debate over minimal savings on downsizing the Legislature. The Government has created a diversion; large, financially worthy decisions are delayed. It should to be talking about public policy issues and measures that will seriously downsize government expenditures; it dwells on an amount equal to a rounding error in the context of the size of the deficit, especially next year's.

A crisis looms; the important issues can’t make it to the top of the public agenda.

WISDOM, WEALTH AND THE LESSONS OF HISTORY

If a society wishes to endure it ought to rely on its wisdom more than on its wealth.   

The idea suggests we have to use our heads, employ intelligence and rely on analysis rather than risk being swept into a whirl-wind of indulgence.   

An essential component of wisdom is discipline, both personal and collective. Discipline speaks to self-control, to living within ones means, to thoughtful planning, and to the ability to make adjustments even when they are painful; discipline suggests a pre-occupation with a larger prize, more than that afforded by immediate gratification.

Following the Budget last year, some asked: how it is possible that financial whiplash could again be suffered so quickly; the music suddenly muted on our celebration of nascent wealth?

Others rightly express bewilderment that we have not taken care to prevent successive deficits of $200 million and $450 million for the past two years and a forecast deficit for the 2014-2015 fiscal year will be higher again.  We have also done little to resolve the accumulated debt of the first five decades of Confederation.    

The question is: are we any more enlightened than our 20^th Century forbears?

DUNDERDALE ADMINISTRATION: UNFIT TO GOVERN

It didn't take long for the Nova Scotia UARB to approve the Energy Access Agreement (EAA) in its Supplemental Decision on the Maritime Link (ML). Its blessing is needed by the Dunderdale Government to trigger the Federal Loan Guarantee (FLG) for Muskrat Falls.

The UARB took just one week to digest the evidence presented at both the Technical Conference and Hearings and write a Report. They ought to feel a little foolish for the rush knowing it was unnecessary to create more CO₂ than a Sydney coal by burning all that mid-night oil; the Dunderdale Government is concerned with saving face. It would have agreed to anything.

The crux of the matter is that UARB declared, in its July Decision, (para 216, page 70) the Maritime Link is $706 million to $1.422 billion more expensive than the alternative lowest cost option.  It stated that its approval depended upon Emera’s success at closing this large financial gap.  It said the gulf could be bridged if Nalcor guaranteed to Nova Scotia sufficient surplus or “Market-priced” energy from Muskrat Falls. 

It had no concern about price as long as the power was valued against the super competitive New England market. A bigger fear was that Labrador mines or domestic growth might absorb the available surplus.