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Wednesday, March 14, 2007

Harper's Divide and Conquer Strategy on Equalization

According to the most recent Statistics Canada Census, Newfoundland and Labrador’s population is continuing its free fall, a situation that has existed since the collapse of the federally mismanaged cod fishery in the early 1990’s.

Newfoundland and Labrador, which last year had the distinction of being the only province in Canada to see the number of deaths match the number of births, for the first time in the Country’s history, has been reporting a net population loss ever since the economic turmoil created by the dismal failure of Ottawa to protect and preserve Atlantic fish stocks began to hit home.

Interestingly Statistics Canada noted that population losses were reported in only two Canadian provinces, Newfoundland and Labrador and Saskatchewan. Is it a coincidence that these are the same two provinces fighting tooth and nail to ensure that Ottawa allows them to recieve the full benefits of local non-renewable resource revenues in an effort to grow their economies?

Most certainly not!

With the ability to increase revenues these provinces would have an opportunity to improve their economies, foster development, pay down debt and attract and retain citizens.

Unfortunately it’s beginning to look more and more like Prime Minister Stephen Harper is about to walk away from the promise he made to Canada on this issue prior to the last two federal elections and will soon kill any hope the two provinces have of ensuring their very survival.

Over the past few days Harper has announced $1.5 billion for Ontario’s transit system and $350 million will go to Quebec for environmental improvements. Clearly an attempt to buy support for his new budget, scheduled to come down on March 19th, and to ensure that the two provinces don’t fight too hard over his likely exclusion of 50% of non-renewable resource revenue in the equalization formula. Both would prefer to see 100% of the revenues included since their economies are not dependent on natural resources.

On the other side of the battle front Harper has announced hundreds of millions for Alberta, after which Alberta immediately backed away from their support of exclusion of non-renewable resources. A stand they had taken in support of Saskatchewan and Newfoundland and Labrador. This has left only these two provinces and BC to fight on. Of course with this divide and conquer approach happening one has to wonder how long it will be before Newfoundland and Labrador is left to twist in the wind on its own.

In addition to buying off Ontario and Quebec, Harper has also announced $200 million for BC, a fairly quiet ally of Premiers Williams and Calvert. He has also announceder $1 Billion in aid for farmers in Saskatchewan, obviously an effort to buy off voters there and weaken the position of Premier Lorne Calvert who wasn't even invited to attend the press conference held in his province. Perhaps BC and Alberta should have been more vocal on the issue early on. Looking at the numbers being thrown around lately it seems they might have gotten a bigger bribe if they had been more vocally opposed to Harper's flip flop on this issue.

With all of this to consider, the message should be very clear to Premier Danny Williams and the people of Newfoundland and Labrador. Sorry folks but once again you’re on you own. Say goodbye to the victory gained during the Atlantic Accord battle because if 50% of non-renewable resource revenues are included in the new formula and a cap is put in place to ensure that no equalization receiving province can have a greater fiscal capacity than Ontario (the sacred cow of politicians) then any gains made on that front will disappear into the darkness faster than a politician the day after winning an election campaign.

17 comments:

Anonymous said...

Artfull Dodger .....

I think the writting is clearly on the wall. The federal minister of finance was in the province last week to say a lot of nothing, and basically just re-announcing the capital gains initiative for fishers wishing to transfer their licence to a family member, this was old news. When the local media quized the minister on the accord, the minister basically mouthed a well rehearsed response which shed no light on the feds intentions.

The conservatives (Harper) are not concerned about the three seats they have in this province when they can possibly garner more support from vote rich Quebec or Ontario, 'the more things change the more they remain the same'. We need to fully understand one thing....the high mucky mucks in this country don't give a rats posterior about this province. The feds know that the conservatives members from this province are firmly within the governments fold. Loyola and Fabian are going to do what is best for their careers and Norm has tossed in the towel possibly knowing that after the federal budget, he may have a difficult time winning back his seat. I say brace yourselves for Williams to blow a gasket and start using the 'S' word following the conservative let down in the budget.

I believe the conservatives feel safe now, especially if they had to face the liberals led by Dion in an election. Dion is not going to be the next PM and that is as clear as the nose on your face. My prediction is....the conservatives (god forbid) could win a majority albeit a small one this spring. the Justin Trudeau (Trudeau-lite) will win his riding. The liberals will have a leadership review at some point which will lead to the grooming of Trudeau-lite for the next Liberal leader.

Regars,

Artfull Dodger

Anonymous said...

After all is said and done there is absolutely no way that the province of Newfoundland and Labrador can get ahead in the Federation of Canadian provinces. The deck is stacked against it. The writing is on the wall.

All one has to do is analyze how monies have been allotted strategically by Prime Minister Stephen Harper in the past year to understand that it is a losing battle for Newfoundland and Labrador.

Anonymous said...

Ireland was the basket case of Europe, but some politician or politicians saw the dire need to give Ireland a break. Now Ireland is known as the Celtic Tiger and it is well on the way to economic freedom. Yet Ireland has nowhere near the resources that Newfoundland and Labrador possess.

It should be a no-brainer that in order for Newfoundland and Labrador to get ahead, its resources must be developed primarily to create industry in Newfoundland and Labrador, with Canada benefiting indirectly through having a great economy in this province. Instead of Newfoundland and Labrador being on the welfare line receiving equalization indirectly from its resources, Newfoundland and Labrador will be generating industry and economies right here and remitting to Ottawa a part of the taxes generated by those industries and paying our fair share into the equalization pot.

Instead of being under the liability column on Ottawa's ledgers, we will be under the assets column. Mr. and Mrs. Politician do what is right for Newfoundland and Labrador. Please do not let us suffer with this injustice any longer.

Patriot said...

Indeed, you are right folks, the writing is on the wall. With a cap in place based on the fiscal capacity of Ontario, NL will wither and die.

Think about it. A cap would be based on per capita provincial revenues. There are only two ways to raise the level of revenues on a per capita basis. One is to increase revenues generally and the other is to reduce the population.

Right now our provincial revenues are heavily tied to resource revenues. While these produce high numbers, they don't often produce high levels of employment across the province (especially when most of the secondary processing is done elsewhere).

As a result, while our revenues come in, our people continue to leave in search of work which means that our per capita revenues grow out of whack with actual revenue growth.

As our per capita revenues rise our equalization funding drops (since they are also based on a provincial body count)and as our equalization dollars drop it becomes harder and harder to provide an environment that can support the population.

This sort of system results in even more people leaving and in turn it leads to less and less equalization funding.

It's a viscious cycle and we are like rats running on a wheel that's getting us nowhere.

Actually I'm wrong there, we are getting somewhere and that somewhere is a slow and painful trip into oblivion.

Anonymous said...

I don't want to see this happen but if it does I hope the people of this province finally say, "enough is enough, let's get the hell out of this screwed up federation!"

Anonymous said...

Another tactition playing "Win The Vote Game."
When will the poeple of Newfounland ,And Labrador rise-up and claim what is rightfully theirs.Instead of begging the Overlords of central canada to return what they have stolen.But ,what up-sets me the most is how the "liberial" left continues to simply ignore,this behavoir.If this was George Bush doing something of this sort to centerl canada,then it would be the evil capitalist feeding on resource rich canada.But,when its "Thier" governement killing thier own people they just don't seem to mind,because ,hey ,it's all canada right.When are we as a nation of people going to start relising that the people we send away are not coming home.That the young people that have left Newfounland and Labrador are not coming back becuase there are simply no jobs to come back to .Were is my birth-right that my Forefathers had fought and died for .Were is my home that has been destroyed by Captain Canada,and his band of thiefs and Liars.
In times like thease I pray to "Almighty GOD",that someday my prayers will be answered and that the sacrifices made by my Grandfather will be recognized.Wether
the fall of this so called "Federation" comes from Alberta,Quebec,or Newfounland really makes no differance to me.All I ask is this.That when her day of retribution is dealt to her for the crimes she has commited.I pray that I am alive to see it,and that she gets no more then what she has done to her so called "Peers."
Until then I pray for the next referendum in Quebec,and pray to God to give the Quebecoise the common sence to fullfill thier dreams of nationhood.Hoping that Newfounland and Labrador has the sence to follow.
Until then ,I have Hope!!!!!

God Bless Newfounland And Labrador,I Pray For Your Return To Freedom.

Mike said...

I have a very good liking for Norm Doyle. Who wouldn’t?

During the last Federal election I met him many times and came to realize that what you saw was what you got. Genuine and caring for people. A constituency person of the highest degree. I disagreed with him on many issues but give him full marks for his gentleness and approachability.

My question is….why is he retiring now?? Why just days before the Federal Budget? Why not wait and use the seat to put pressure (if necessary) on Harper to come through for the Province in its struggle with Ottawa on Equalization payments?

Surely he’s not bailing out before the storm is he??

I REALLY look forward to having the Premier campaign for the NDP in St. John’s East during the next election given that he has promised a “goose egg“ to Harper if (and when) he fails to come through for the Province.

Liberal Leader Dion has made it quite clear HE doesn’t support leaving natural resources out of the computation of equalization payments. That will hurt Newfoundland and Labrador in a major way. NDP Jack Layton on the other hand DOES support the Province and even goes further and endorses the transfer of the federal equity in Hibernia to the Province (8.5 %).

Yes sir…… I really look forward to Williams support for the NDP. Bring it on. I know just where he can put a few of those campaign signs .


Happy retirement Norm! How about it Loyola?? You next??

Anonymous said...

Artfull Dodger said.....

Mike, I too like Norm Doyle, and I have a sneaking suspicion Norm is throwing in the towel because he knows that the federal budget is going to result in this province seeing its gains made through the Atlantic Accord rendered null and void by the conservatives. I will predict right here and now, that if the budget ends up hurting this province, that there will be no more than one conservative seat in this province. I believe Mannings seat will be safe but thats all!

Loyola has been a dissappointment frankly, and I would not be surprised if the next election will see him take a loss if a credible opponent is run against him.

As far as this province and it's future is concerned, I think we are f--cked, plain and simple!

The writting is on the wall my friends!

Regards,

Artfull Dodger

WJM said...

Newfoundland and Labrador, which last year had the distinction of being the only province in Canada to see the number of deaths match the number of births

You might prefer to think of it as "the only".

I prefer to think of it as "the first". Every other province is headed in exactly the same direction.

Two, possibly three, will be in the same boat, if not this year, then by 2008.

Anonymous said...

Ohhh........poor poor us. We're on our own again. *sniff*

Good grief. No wonder no one wants to help us. We're a bunch snivelling kids on the playground who cry when we don't get our own way, and the teacher is sick of hearing about it.

But, hark!! Danny will save us all! Oh Thank God.

Here's a thought....let's get rid of the guy who everybody else in the world can't stand or reason with, and maybe some good stuff might start happening again. I for one have had enough of the premier's grandstanding and making issue out of EVERYTHING! It got old real quick.

Things were going great in the oil industry until Mr. Williams opened his big trap.
Never mind all those who will write and say GO Danny! and "he's standing up for us"....
he's single-handely flushing us all down the drain.
It's all well and good to stand up and fight for NL , but you have to know when to accept concessions too. There's not a place on this earth where you don't have to "meet in the middle" sometimes.

But no, as long as we are egging him on, the premier will continue to try to bully big business and in the end they simply just leave for greener pastures and we have to live with the failures.

But we still have our pride!

Anonymous said...

Oh God one of thos hacks who wants to give away our oil and any other resource that the world wants. Can you please come up with another suggestion? While I do not agree with everything that Premier Williams stands for, I do not agree with the giveaway of our resources. That is the exact reason we haven't been able to get ahead, we gave our resources away for others to do so. The same reason we cannot get our own people at home and we cannot attract immigrants, whether from Canada or abroad.

Obviously you yourself are hurting because we are not giving away our oil, or whatever other resource you are lobbying out of this province. Please stop the "me syndrome" you are destroying this province by doing so. The "me syndrome" has been so prevalent in this province over the past 58 years, Newfoundland and Labrador have been totally destroyed.

Anonymous said...

Artfull Dodger said....

In reponse to anon mar 15, 2007 8:30 am. (I can't keep the anon's straight I swear), I will agree with you with respect to William's approach. I don't think picking public fights with those whom he is dealing with to be particularly usefull, at some point people have to sit down as reasonable adults and talk. I will say however, that big oil looking for tax concessions is totally absurd, especially when we see them making record windfall profits. The problem that the province/Williams faces, is that the oil companies can wait the province/Williams out, they will eventually get the agreement which is palatable to them, but i honestly believe need to stand firm on 'no tax concessions'.

Regards,
Artfull Dodger

Anonymous said...

"Yes" Premier Williams do stand firm on the 4.9% equity in our oil and please do not give away our resources so that some other province or country will be able to do the primary and secondary processing on them. Primary, secondry and further processing of our resources are how we will get ahead. I do know that you have a lot of pressure on you from some people within the province and many outside the province, who wish that you go ahead and dig the resources out of the ground or the ocean and pass them over to others to survive. We cannot afford to do that any longer. We have destroyed ourselves by doing so. Premier Williams if you stand firm and keep to your own words of "no more give-aways" we will zoom ahead by exploiting our resources to the nth degree in the processing sectors. Not only will we be able to keep our own people working here, we will be able to attract people from other parts of Canada and the World.

Please do listen to the anon of March 15, 2007 8:30 AM, who probaly has an intrest in the oil or some other resource by lobbying for outside interests, or who has interests in some other direction. That person's interest can be filed under the "me syndrome", certainly not the "us syndrome".

Patriot said...

There may be hope yet. According to a news report today it looks like Harper's conservatives won't be able to count on the NDP to support the budget and prop up their government. They'll have to cut a deal with the Liberals or Bloc to stay alive unless they decide to exclude 100% of non-renewable revenues.

Here is the news report:

Layton Wants a Fair Deal for Saskatchewan





Written by Evan Wright - 600 Action News-Local First
Thursday, 15 March 2007
N-D-P leader Jack Layton is looking for a Saskatchewan-based equilziation deal when the federal budget is delivered Monday.

If a solid deal is not found, Layton is prepared to vote against the budget.

Layton wants to see 100-percent of non-renewable resources removed from the formula, as promised by Stephen Harper during last year's campaign.

Based on announcements made by the Harper government over the last month, Layton is pessimistic the promise will be kept.

The N-D-P leader also urges Saskatchewan's 12 Conservative M-P's to strike down the budget if equilization is not addressed.

Anonymous said...

Artfull dodger said....

Patriot, on one hand this looks promising, however it appears the conservatives are gearing up for an election, they may not be counting on the NDP supporting the budget. The polling seems to indicate the conservatives are ahead of the liberals and would win an election, not sure if it would be a majority.

If the budget did not pass and an election were to take place with the conservatives winning a majority, even a slim one, I fear our goose would be cooked with regards to the Accord.

Regards,

Artfull Dodger

Anonymous said...

Layton has been talking out of both sides of his mouth on this issue. In PEI - a province with hardly any non-renewbale resources, he said he wanted a fairer deal for them to. Basically, he's just saying he supports whatever is popular in the province he's in. Typical politician.

I would say Harper learned a valuable lesson from Paul Martin. If yo're going to piss away 2.4 billion dollars to a province like Newfoundland, and then come out of it with even fewer seats than you went in with, it probably isn't worth the bother politically.

Anonymous said...

I think Sue Kelland Dyer would be an excellent politician for this province. I hope she offers herself in the future. She is an intelligent person, whose energies could enhance this province greatly if her talents were utilized within the political system of this province to fight for the rights of Newfoundlanders and Labradorians.