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.

DOES THE FEDERAL LOAN GUARANTEE HELP YOU SLEEP BETTER?

There are some, including this Blogger, who had hoped the Federal Loan Guarantee (FLG) would not get final approval.  The UARB’S approval of the Maritime Link scotched that possibility. 

It does seem bizarre that critics of the Muskrat Falls Project, in this Province, would look to outside intervention to defeat an unwise, even foolhardy use of public money.  But, when independent assessment is shut down and essential information denied, the options are scarce. 

Now that the Government has prevailed, it is unlikely that thousands of Newfoundlanders and Labradorians will pack our version of “Independence Square” (as the citizens of Ukraine are now doing) to push-back bad policy and to demand the Government’s resignation.

The Harper Paradox

It was not abnormal for my old friend Uncle Gnarley to pay a visit.  But it was certainly abnormal for him to call in advance.   It was at sunrise, this morning, when the phone rang, the old gruff voice was more effective than any alarm clock in getting my blood moving, “Have you read it Nav….?”

“Read what”?

“The Loan Guarantee!  Have you read it”?

But, before I could answer, he continued with his usual charm, “I am coming over this evening, I want to discuss some if it’s finer points.  Be sure that you drop by the Controller’s today”.  With that the phone went dead. 

I was’t sure if I should read the Term Sheet, but I knew I had better pick up a bottle of Oban.  Gnarley may be forgiving with the former, but I would certainly feel his wrath, if I had forgotten the latter.