A BATTERED P.C. PARTY MUST CHANGE (PART I)

Premier Dunderdale’s resignation was not a question of ‘if’ but ‘when’.  If the decision had not been made now, following her unwise and unsympathetic response to the power “crises”, it most certainly would have been made after the House of Assembly closed in the spring.

The Premier’s loss of popularity began shortly after the 2011 General Election and the decline likely descended to a new low as the acrimony of the power outages unfolded.  At the best of times it is tough to build on an approval rating nearing 20%.  It is especially hard when fall-out continues from policies like Muskrat Falls, Bill 29, successive huge deficits, and an inability to recognize mutual respect as important mark of leadership.

How could the Premier command confidence when hugely important public policies were subject to the dictates of Nalcor, a Crown Corporation and its CEO Ed Martin, without as much as Department of Finance oversight?  The very idea of such a derogation of duty is repugnant within any context of ‘Responsible Government’.      

Even if one were to give the event a most generous appraisal, the resignation of the Province’s first female Premier, after only 27 months, is a disappointment.  Most people, regardless of partisan leaning, would have wanted her to succeed; a Premier’s success is closely related to the fortunes of the Province. Then, too, proof that the role of First Minister is gender neutral also needed affirmation.   At least on that account, the Premier succeeded.       

Dunderdale was in many ways an incomplete Premier; long-serving and ambitious on the one hand but, on the other, a politician lacking the disposition to share a common bond with the body politic. 

GLOBE COLUMNIST REBUKES NL PREMIERS

Imagine that the Globe and Mail saw fit of a day to spill some printer’s ink our way!

Last week, Columnist Konrad Yakabuski, in an opinion piece entitled "Muskrat Falls and the Power of Obstinacy" had a lot to say about Newfoundland and Labrador Premiers, in just a few short sentences.

He was unimpressed that a bungling Premier Kathy Dunderdale’s response to our power black-outs could have been so unlike Ontario Premier Wynne’s deft handling of Toronto’s. Dunderdale, Wynne, he noted was “...sugar, spice and all things nice...” 

But it was Dunderdale’s characterisation of the outages as a “non-crises” and her assertion that, in retrospect ”she would not have done things differently” that caused Yakabuski’s to share his previously unknown theories about the collective peculiarities of NL Premiers. 

Dunderdale’s lack of empathy did not constitute news down here; we’ve seen it many times before.  For that reason there is far less certainty all our Premiers deserve Konrad’s assignation to any Dunderdale populated Club.

NEW FACEBOOK PAGE HELPS GROUPS FILE COMPLAINTS OVER POWER 'BLACKOUTS'

How angry are you with Nalcor over power problems that left most of the Province without electricity and several days of rolling blackouts? 

Well, at least one group of 5 people, apart from the Liberal Party, filed a formal complaint, on Thursday, asking the Board to investigate and hold public hearings.    

The five residents are: Brian Grant, Cabot Martin, Con O’Brien, John Parsons and Des Sullivan (your Uncle Gnarley scribe).

The group welcomes the decision of the PUB to proceed with both an inquiry and hearing under the Public Utilities Act, announced today.

This group's Complaint and those of others have been posted on the PUB Web Site.

CRA POLL REFLECTS BY-ELECTION MESSAGE TO THE PREMIER

When Kathy Dunderdale told Reporters on the afternoon of the Harbour Grace - Carbonear By-election, ‘whatever happens it’s just one Seat’, you are forced to wonder just how disconnected she is from ordinary people and detached from notions of leadership.   

The CRA Poll, released on Wednesday, places the Premier’s personal popularity at only 25% (22% three months ago) against 39% for Dwight Ball and 18% for a chastened Lorraine Michael.

Why would anyone expect the Premier’s popularity to be higher? ‘Whatever happens it’s just one seat’ is declaration of ‘don’t care’ when it ought to be one of concern and distress.

If you took notice of her comments on the six o'clock news – just two hours before the Polls – why would you think the Premier could ever lift the Tories’ from the doldrums?

Though support for the P.C.’s increased to 29% (from 26%), it equates only with the Poll’s margin of error (2.9%), so even this uptick is tentative. 

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.

OVERSIGHT, TRUST AND THE PROVINCE'S REPUTATION

“Reckless” is not normally a word ascribed to governments in Canada.  Increasingly, though, it is how people refer to the NL Government of Premier Kathy Dunderdale. 

Her rejection of pleas, from her former Finance Minister, for an “Oversight” Committee on the Muskrat Falls Project is bewildering; it is not how responsible governments act.  (See: DID JEROME KENNEDY BITE HIS TONGUE?)

Jerome Kennedy is a major figure in the oversight issue but only because he can still influence the outcome.  He may still be biting his tongue, but I believe the public would like him to do more. 

DID JEROME KENNEDY BITE HIS TONGUE?

If the departure of Jerome Kennedy, from the Cabinet, had been marked with the silence that normally follows any Minister’s return to private life, who would want to invoke his name now? 

Well, it seems Mr. Kennedy did not go silently; he seems to have ‘bitten his tongue’ as he left Confederation Building.  His name still resounds within the halls of high office.  As his vehicle left the parking lot, very senior people acknowledged, to each other, that he ought to have explained himself differently than he had.

That comment strikes at the heart of the question: why did Mr. Kennedy resign? 

Source: The Canadian Press

Whether certain disturbing issues weigh heavy on him, only he can answer.  If the information this scribe has received, is correct, which has been corroborated by three additional sources, Mr. Kennedy may wish to re-consider anything he may have omitted from his exchange with the media, justifying his departure.

What is the issue?

It seems that Mr. Kennedy’s resignation was occasioned, less by a desire to return to his law practice, than to deeply felt concerns over certain financial aspects of the Muskrat Falls Project, specifically involving Nalcor.  Just two years ago he sought election for a full term.

THE DUNDERDALE GOVERNMENT: WHIMSY AND RE-SET

I was expecting a call from Uncle Gnarley.  The old man had not gotten me to Post anything, for him, in quite a while.

I was happy to finish "Peering Into A Political Pressure-Cooker”.   It was a depressingly tough slog for someone with an optimistic bent.  Politics is not conducted in isolation, it may be an activity often removed from the public, but it is always about public money.  So, not only politicians are affected when the fever of bad leadership threatens contagion, it is a problem for us all.

The Blog piece out of the way, I thought I might sketch some suggestions as to how Dunderdale might put the Government on “re-set”. She has lost much public confidence.  She says the problem is her tough decisions.

Still, it is hard to mistake public policies, like Bill 29 and terrible Budget practices, for tough love. 

I have to admit, the notion of a new script for a Premier, one down on her luck, caused me to think the exercise whimsical. Then, I thought, a little whimsy is hardly worse than sheer presumption.  I would be the last person in the world whom she would ask to “re-set” her Administration.

JEROME KENNEDY EARNS A SCOLDING

Jerome Kennedy tendered his resignation, from the House of Assembly and from Cabinet, yesterday.  We should thank him for his services and wish him well. 

But, in his case, we ought to first wag a bony finger in his general direction, and give him a good scolding.

That is unfortunate after six years of public service and four senior Cabinet positions.  Still, Mr. Kennedy has little to show for his hiatus from the practice of law.

That his departure ranked second, Wednesday, on the CBC 6 O’clock News to a bed bug infestation, was a most unkind cut; one Dunderdale’s new PR man could never have thought devising.

Perhaps, the CBC, too, barely thought the announcement news. Mr. Kennedy’s preference to leave politics was the talk of garden parties in his District, this past summer.  His early return, from the Premier’s China junket, spoke to a none-too-private disagreement with her.  An earlier dust-up in Caucus, following his irreverent comments on the sanctity (or otherwise) of the Tory Blue Book, did little to endear him to his colleagues. 

HOW THE PREMIER DAMAGES HER CREDIBILITY (Part II)

Premier Kathy Dunderdale

Verbatim Transcript from media ‘scrum’

Corner Brook, September 12, 2013 

“….I was at a Conference in Quebec this weekend for two days with the six New England Governors who talked about energy development…..particularly in Newfoundland and Labrador…they’re saying develop, develop, develop, Governor Shulman is saying if you got the juice we got the use so here are the people who are buying Canadian electricity saying to Canadian Premiers develop, develop, develop because we got the markets….we have just had six Governors purchase power for their states…they are talking specifically about Muskrat Falls, specifically about Gull and how that power needed to be developed and they had a use for the power in New England….the Governors are saying there’s a market, we’ve been saying there’s a market for a long time…”

Comment:

There may be a market, in New England, for electricity.   But, is development of the power commercially viable?  Is this Province prepared to expose itself to the construction risk and willing to heavily subsidize the cost of the power, as we are doing with Muskrat?  That, I believe, is exactly what the Premier is counselling.

HOW THE PREMIER DAMAGES HER CREDIBILITY (Part I)

Public policy will always be contentious even when diverse opinions are based upon agreed facts.

One of the great characteristics of an open and free society is that individuals are at liberty to add to our collective economic and social well-being with an intellectual contribution that is personal; people perceive needs, arrange priorities or interpret factual evidence, each in their own way.

Perspectives may be influenced by self-interest, culture, maturity or screened through some other lens. Though contrarian views cause strain on the social and political fabric, they and our right to possess them, are what sets democracies apart in a world where political control is pervasive.

That said, if there exists one key to reducing conflict or to finding consensus among diverse groups and individuals, it is the prospect that all of us might form and share our opinions, as often as possible, based upon on a complete set of facts.  It is an impossible goal, but a noble one, which makes it worth striving for.  Integral to its achievement is the possibility that those in authority, who have greatest access to the information and possess the ability to pay the specialists to generate it, do not subvert the process.

WHY ONLY A 50/50 CHANCE FOR EMERA SANCTION?

Last time, I referred to BMO Capital Markets’ Report that the Maritime Link might have only a 50/50 chance of sanction.  You may well ask why only 50/50?  Given all the sweeteners Emera has been offered to become Nalcor’s partner, why are the odds so poor? Let’s take a look at Nalcor's deal with Emera:

a)      Emera’s investment, in the transmission line from Labrador, receives a “guaranteed” rate of return from Nalcor. 

b)     Emera receives 20% of the power from Muskrat at zero cost (but for the cost of the Maritime Link)

c)      Cost overruns on the Labrador/Island transmission line are paid for by Nalcor

d)      80% of Emera’s cost overruns on the Maritime Link are paid for by Nalcor

e)      Emera receives the benefits of the Federal Loan Guarantee; and

f)       Emera gets to broker any “surplus” power for which it will receive fees

Not a bad deal, by any measure, wouldn’t you think.    

But Emera is still holding out on sanctioning the Maritime Link. 

GIVE THAT MAN AN OSCAR

Nalcor’s precursor, Newfoundland Hydro , for many years, was a quiet Crown Corporation responsibly meeting the Province’s electricity needs. It never tried the movie business. Management, then, were serious folk, eschewing glamour for its own sake.

Then, along came Danny Williams. 

Reportedly, he had struck it rich in the ’regulated’ world of cable television.  The experience had left him marked with the magic of guaranteed returns.  On the public stage, he demanded a script suggesting that such profits could easily be replicated, by public servants, applying the leverage of taxpayers’ money.  That’s the problem with ‘showbiz’; it’s hard to distinguish fact from fiction.

A GOVERNMENT OF FOOLS

Those who noticed the decisions, out of Nova Scotia's UARB and Hydro Quebec, should not be content with being surprised.  Afterall, by anyone’s standards, surprises on a major scale, that appear after $7.4 billion has been committed, constitute recklessness.  The public should deal with this reality; it needs to tell the Premier to stop. 

The UARB has stated, in uncommonly plain language, that the Maritime Link is not, now, the lowest cost option for Nova Scotia.  It says that 15 cents per KWh for the Nova Scotia Block is too high and demands that all of the ‘surplus’ energy from Muskrat Falls be made available.  Altogether, the two blocks constitutes 60% of the power from Muskrat Falls. It says, only by levelling the price, with cheap (5-9 cents KWh) “market-priced” power, can it achieve the desired blended rate of 10 cents, allowing the ML, over time, to become the lowest cost option. 

Exhibiting Quebec style opportunism, NS could care less that Newfoundland rate-payers will pay in excess of 20 cents per KWH.  They are not concerned that Newfoundlanders and Labradorians will assume all of the construction risk, including 80% of cost overruns on the Maritime Link (ML). But, NS sees an opportunity to benefit and who can blame them.  They are doing what ‘states’ do: they act in their self-interest. If Premier Dunderdale had consulted Brian Peckford on Nova Scotia’s antics, during the Atlantic Accord saga, she and her Ministers might not have so quickly earned the mantle, ‘babes in the wood’.

THE END OF THE BEGINNING FOR MUSKRAT FALLS

Monday, July 22, 2013 will go down in infamy as the date on which the wheels finally began coming off the Muskrat Falls Project. 

Some would rightfully argue that the wheels, on this Project, were never properly attached anyway. Who, except Kathy Dunderdale, Ed Martin, Jerome Kennedy and Cathy Bennett would disagree.

Likely, at this very moment, the Dunderdale crowd, in Confederation Building, are enjoying the relaxation of summer; the House of Assembly is closed, Ministers are off to their country places and the oppressive heat, wrought by an angry public and pesky Pollsters, is a distant memory for a battle weary Government.  I doubt that a single one of them appreciate that the Dunderdale train just got side tracked and is now hanging over a very steep political and financial precipice.

GIVE PEOPLE LIKE JIM PRENTICE AN EARFUL

Golly gee.  Wasn’t it so nice of former Federal Tory Cabinet Minister, Jim Prentice, to pay the folks down in “Newfie” a call?  What would we have done without a visit from ‘ol Jim?

NOIA delegates showed up, in droves, to hear the words of the good ‘ol boy, from Calgary, now CIBC’s energy expert.  Reporters wrote down his every word; the newspaper and other media gave him precious space.  Jim must be thinking: what they say is really true: ‘they’re a bit dull but these Newfies sure are nice folks’!  Even the reporters were nice.  Yes, everyone was nice…they just loved what ah had to say…my bank buddies will be so pleased, ah shucks, ah sure hope we get to sell some of those Muskrat Falls Bonds. Why, I’ll get a bigger bank bonus if ah can turn that little trick.’

Yes, Jim, in Newfoundland and Labrador, we’re all rooting for you!

Oh my, Oh my! 

DO WE NEED MORE ROCKING CHAIRS? (PART II)

I wasn’t aware of the rift between Jos Arnell and Josiah Brake until Uncle Gnarley and I left Jos’ house, last Sunday; clearly the world doesn't stop when I'm out in my kayak, as the first part of this tale confirms:  DO WE NEED MORE ROCKING CHAIRS? (PART I).  I have already told the story of Jos having accosted me on the slipway, in Petty Harbour, as I concluded my ablutions before taking to the water.  I got a great kick out of Jos' mumbo jumbo outburst  and I was even more amused when she announced her intention, to Uncle Gnarley and me, to run for the Liberal Leadership.  

I had missed a great deal, that day, while on the water. Thankfully, Uncle Gnarley filled me in.  The way he explained it, was like this: