Da Legal Stuff...

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Now, with that out of the way...Let's Web Talk.

Thursday, November 29, 2007

The Ice Man Cometh...

With a Bill sitting on Parliament Hill that supposedly clears up the Atlantic Accord mess, Bill Casey still in the news and a deal done over the Atlantic Accord in Nova Scotia, if you can call a verbal agreement with Stephen Harper a deal, it's more than a little interesting that the PM has found a feeble excuse to pay a visit to good old Newfoundland and Labrador this weekend. I would have thought someone with Harper's team of advisors could have thought of something more believable than visiting Fabian Manning and wishing him well on his nomination papers being signed.

Of course a meeting has been scheduled with Danny Williams but that's not the real reason for the visit (wink, wink).

Could it be that Harper is just trying to head off the next wave of ire from the Premier? I mean he couldn't be worried about another round of bad publicity could he? What with the last round, his handling of Afghanistan, Ottawa's obstructionist stand in climate change and a pending inquiry into Brian Mulroney's business dealings and his knowlege (or lack of knowlege) about them, he must be used to dealing with bad press by now.

Maybe not.

It should be an interesting meeting and an even more interesting few days afterward.


Wednesday, November 28, 2007

When Political Will and Sound Economics Align

When political will and sound economics fully align in a simbiotic way great things can happen. Let's hope this is one of those rare occassions.

There’s more than one way to skin a seal and it looks like Premier Danny Williams may finally be listening to voices in Newfoundland and Labrador when it comes to using lower Churchill power right here at home.

Ever since the Lower Churchill project moved from the back burner to the front there have been a number of proponents, from individuals to advocacy groups like NLDL.org and even yours truly, who have beaten the drum for local use of the power.

While there are those who spent most of their time debating the Quebec vs. Maritime route for exporting the power others loudly wondered why industry couldn’t simply open up shop where the power exists and in doing so help diversify the economy.

It just makes economic sense that if the province sells the power to Quebec, Ontario or whomever, the purchasers will charge their customers more for that power than the users would have to pay if they bought it straight from the source. Enter CVRD.

Recent reports say Danny Williams and a provincial delegation just spent a week in Brazil, the home base of CVRD, and discussed the possibility of building an aluminium smelter in Labrador.

According to a Telegram report, Williams said, "The province is actively seeking requests from various companies to look at the possibility of an aluminium smelter in Labrador, which would utilize the Lower Churchill power when that comes on stream around 2014, 2015,".

Brazil-based CVRD - is one of the largest mining and metal companies worldwide. CVRD became the owner of the Voisey's Bay nickel project when they took control of Inco a year ago. According to Williams the company plans to live up to all of its obligations in the province, including the building of a commercial nickel processing plant in Long Harbour.

Williams said CVRD is not the only player in the running for a possible aluminium smelter. He said discussions are under way with other companies.

Newfoundland and Labrador Hydro is actively pursuing the issue, the premier said.

There’s no doubt some power will have to be exported in the short term, but if the province hopes to see any real benefit from Lower Churchill that benefit will only come from using the power to attract industrial development and manufacturing. Industries in desperate need of clean, low cost and dependable power.

Friday, November 23, 2007

Atlantic Accord Deception is Clear

The following appeard in the Nova Scotia Business Journal and is certainly worth a read heading into next week.

Atlantic Accord deception is clear: Casey

Shunned Nova Scotia MP Bill Casey is using first-hand stories and public tapes in hope of showing that Prime Minister Stephen Harper and Finance Minister Jim Flaherty lied about the Atlantic Accord. Casey shared stories with The Daily News on Tuesday that he believes prove the Conservative government was trying to mislead Nova Scotians.

Casey says when controversy over the Atlantic Accord first erupted earlier this year following the Conservative budget, he went to Flaherty and asked to know exactly what had been changed from the original accord. "He looked me in the eye and said, 'Not one comma was changed," said Casey. "He said that to me twice. And I was relieved ... but in the end, that's absolutely not true. I think they thought they could pass one by us without anyone noticing."

The MP also describes going to Harper and presenting him with two legal opinions opposing changes to the accord. "He looked at them, and he took his hand and he pushed them away. He said, 'It doesn't matter what they say, I decide what formally exists.'"

Casey also apologized to Nova Scotians yesterday for initially "going in the wrong direction" after the budget. Casey said he believed what Harper and Flaherty told him, which caused him to initially support the Conservative budget. Casey would later vote against the budget and get booted from the Conservative caucus.

Casey was supposed to see a copy of the new equalization deal on Tuesday, he said, but that appointment was delayed until next week. In the meantime, he expressed concerns the government couldn't be trusted to uphold its agreements.

Casey said he has collected a series of public tapes and quotes of Harper and Flaherty taking positions they would later back away from. He cites a February 2005 Harper speech honouring John Hamm, in which he calls the former premier a "great Canadian and dear friend."

"The ultimate victory in this campaign for fairness will be his greatest legacy," Harper said. "Your federal Conservative party was proud to support John's fight for fairness for Nova Scotia ... every single member of our national caucus supported that fight." And then every single member voted to take the accord away, added Casey.

He also presents a 2005 Flaherty quote saying Nova Scotia is entitled to keep all the "terms, conditions and benefits," of the Atlantic Accord. Casey contends this was deceptive, as the Tories changed how equalization was calculated

Ottawa-based group Democracy Watch also scolded Harper for going against an earlier promise. The group claims Harper broke his commitment to "ensure that party nomination and leadership races are conducted in a fair, transparent, and democratic manner."

Democracy Watch cited Harper's fight with Casey's riding association over its selection of Casey as a candidate as an example of refusing to democratize elections. – The Daily News

Thursday, November 15, 2007

Watch Your Back Gerry

Great news today:

Minister Hearn announces federal investments in northern peninsula and Corner Brook area

OTTAWA, Ontario— The Honourable Loyola Hearn announced that the Government of Canada will provide funding to help individuals in the northern peninsula and Corner Brook area gain work experience, explore career options, and find work.

Over $700,000 in funding for projects is provided through three programs.

Under the Employment Assistance Services program:

the Humber Community YMCA in Corner Brook will receive $284,072;
the Emerald Business Employment Corporation in Baie Verte will receive $137,377;
the Green Bay Community Employment Corporation in Springdale will receive $84,307; and
the Supported Employment Deer Lake Extended Regions will receive $53,084.

Through the Job Creation Partnership program:

the Town of Cow Head will receive $22,200;
the Springdale Heritage Society will receive $12,000; and
the Aurora Nordic Ski Club in St. Anthony will receive $11,723.

Through the Self-Employment Assistance program:

the Emerald Business Development Corporation in Baie Verte will receive $84,049; and
the Nortip Development Corporation in Plum Point will receive $49,512 in funding.

Personally,I'm not sure how to take this latest vote buying scheme.

Notice if you will that all the spending is in and around Liberal Gerry Byrne's district. Hmmmm...

Gerry is basically nothing more than a "player" so no love lost there, but never the less, it's interesting to see how much attention the district is getting from the Conservative/Reform/Alliance, PC (CRAP) party.

Things that make you go Hmmmmmm.....

Tuesday, November 13, 2007

On the Next Episode of Soap...

How well did Brian Mulroney actually know Schreiber?

A letter from Mila Mulroney to Schreiber’s Missus tell us the couples knew each other:

A: very well
B: quite well
C: extremely well
D: all of the above

Did Mulroney really take 300K in bribes and then try to cover it up?

Where did the other 19+ million in fees during he Airbus purchase process actually go, does anyone know?

Did the Privy Council Office really not send Schreiber’s letter t to the PMO, did the PMO really not show it to the PM or did Harper actually see the letter from months ago and bury it?

Mulroney is still a major force in the Conservative party and has advised Harper in recent years. How close are Mulroney and Harper and what does Harper really know about the Airbus scandal?

Will there be a public inquiry and if so, which closets will be opened?

Will this latest government scandal provide the fertilizer needed for Stephane Dion to actually grow a personality?

Will Danny Williams start referring to Steve as Brian II?

Why is Jack Layton acting so holier than thou? Is it because his party is so squeaky clean or simply because the NDP has never been in a position to control any more than a few hundred bucks?

Will Peter McKay, eyeing weakness in the PM challenge his leader for the top job or will he content himself with moving to Saudi Arabia with the harem he's aquired over the years?

If the Conservative government is tarnished by this scandal, with the Liberals already ousted after their own, what will voters do in the next election?

Will Starr tell Brick she’s really his long lost Sister or will Brick leave on his annual religious sabbatical first?

For the answers to these questions and many others be sure to tune in to the next episode of “Banana Republic” now in primetime.

Author's Note: My apologies for that last question, but it's damn confusing to have As the World Turns on the T.V. while writing.

Monday, November 12, 2007

First Minister's Photo-Op In the Offing

Canada’s current government has been in office for about two years. Not once in that time has Prime Minister Stephen Harper seen fit to meet with the provincial and territorial leaders at a first minister’s conference. Suddenly with the high Canadian dollar impacting export businesses from east to west Harper has agreed to just such a meeting, but only after several Premiers demanded it. My question is why. Why now, why not earlier and why this particular issue?

It’s not like there weren’t any serious issues or concerns that needed to be discussed before now.

Sometime between now and January the Prime Minister says he will sit down with the first ministers and discuss the impact of the rising dollar. Oddly enough, of all the issues facing the people of Canada, a high dollar is arguably one government can do the least to resolve.

It’s possible to ease corporate tax burdens, lower tariffs or subsidize specific industries, but the value of the dollar is not something political leaders have any real control over. On the other hand, there are a myriad of issues our leaders can and should be addressing but aren’t. These other issues that may not grab headlines or provide the same kind of photo-ops as a soaring loonie but they are issues that hav real solutions. Solutions that would do far more for the Country in the long run than moaning about a high dollar.

Why aren’t the first ministers and the PM trying to resolve the deadlock over an east/west power grid? A grid that would allow provinces to wheel power across the country, without impediment, to areas that desperately need it.

What about the issue of senate reform? Rather than simply talking about abolishing the senate why isn’t the PM spending some time (up front) working with the provinces to find a way of reforming that tired old body and making it do what it was designed to do, provide regional representation to all areas of the Country?

Why, with so many seniors on voting lists across Canada and with more entering their so called “golden years” every day, is nothing being done to help older Canadians live out their lives without having to choose between medications, food and home heat? Millions of older Canadians are doing exactly that. The Old Age Security plan is designed to keep seniors at or below the poverty line and heaven forbid you paid into a pension plan, out of your pocket, because you’ll soon find that your foresight has won you the prize of having your government pension reduced.

There are countless issues that affect all Canadians and that need to be addressed. Issues that the government has far more ability to control and manage than the Canadian dollar. Why have these not warranted the attention of Stephen Harper or the first ministers? Why have they not resulted in a leader’s conference or been addressed at all?

Friday, November 09, 2007

Remembrance Day - NL's Pround Military History Remembered

With Remembrance Day once again upon us, it seems appropriate this weekend to reflect on the exploits of the so called “Fighting Newfoundlanders” and remember those from the Province who fought in conflicts half way around the world.

When many think of the Province's military history they immediately think of The Royal Newfoundland Regiment. Although Newfoundlanders and Labradoreans have fought with the forces of other nations and continue to distinguish themselves today in the Canadian Armed Forces, it is with a special kind of pride that we remember the exploits of that Regiment. Originally formed in 1914.

In WWI the Regiment earned no less than 280 separate decorations, 77 of which were awarded to original members of the “first 500” of which 170 were killed in action. In fact, one in every seven men among the original force received some sort of military honour.

Many people have heard the name of Tommy Ricketts who was given the highest honour possible, the Victoria Cross, however many may not remember some of the other brave men who fought for their homeland under the most dire conditions. The Province has produced many great heroes who are not as well known, but no less deserving of recognition.

Take for example the story of Cyril Gardner, originally from British Harbour. Lieutenant Gardner has the distinction of being the only known allied serviceman to have received the German Iron Cross. The Iron Cross, which was handed out only to the bravest German military personnel, was given to Gardner on the battlefield.

As the story goes, Gardner’s unit was engaged in battle with a German patrol of 70 men. During the night, as hostilities wound down Gardner, who spoke German, took it upon himself to grab his machine gun and head out to the enemy encampment.Sneaking into the enemy camp, the Lieutenant turned his gun on the officers, capturing them unharmed. With their “head” cut off so to speak, the remainder of the troop immediately surrendered. Lieutenant Cyril Gardner had single handedly captured an entire German Patrol.

Upon marching his prisoners back to his own encampment he was met by a British Officer who intended to shoot the unarmed prisoners. As the German soldiers looked on in horror Lieutenant Gardner once again demonstrated his sense of bravery by stepping into the line of fire to protect his prisoners and telling his superior officer that if one German were shot the officer would be the next one to die.

After a moment of hesitation the officer walked away and it was then that the commander of the German patrol, who had many medals on his uniform, stepped up to Gardner and removing the iron cross from his chest, pinned it on Gardner’s, to the applause and cheers of the German soldiers.

For Centuries, even before the formation of the Royal Newfoundland Regiment, the people of Newfoundland and Labrador have answered the call whenever it arrived. Newfoundlanders and Labradoreans have been involved in major conflicts around the world since the mid 1600's, including: The Anglo-Dutch Wars – 1652 The War of the Austrian Succession – 1743 The Seven Year War - 1756 The American Revolution - 1775 The Napoleonic Wars – 1796 The War of 1812 World War I – 1914 World War II – 1939. Add to this the number of young men and women who have proven themselves in places like Korea, Afghanistan, Bosnia and countless other areas of conflict or peacekeeping around the world, and we can clearly see that the Province has a lot to be proud of.

During this Remembrance Day and throughout the remainder of the Year perhaps we should all take some time to visit a legion hall or local war memorial, to stop and chat with an aging veteran and to offer a little show of thanks for the sacrifice these fine men and women have made to protecting our nation.

Statistics show that every day in this country an average of 80 veterans die. That’s more than at the height of conflict in World War II. It only takes a moment to shake a veteran’s hand or buy one a cold beer in a local bar. It might seem like a small gesture and it is, but even taking a moment to express a little gratitude may just brighten the day of some of our bravest and most deserving citizens.

Wednesday, November 07, 2007

Government to Assist Unemployed Older Workers

Politicians are the only people I know who can suck and blow at the same time and they’re so good at it they can almost make the public believe they’re accomplishing something while they’re at it. Perhaps I’m being too critical. Let me rephrase that. They can almost make the public believe they’re accomplishing something besides wasting tax dollars or buying votes while they’re at it.

Today the governments of Canada and Newfoundland and Labrador announced a joint cost shared agreement that will see over 3 million in tax dollars spent to “help” displaced workers in the province. Sounds good right? So why am I pissed?

Here’s why.

The money isn’t being put into any sort of early retirement package or income supplement for these people. It isn’t being used to diversify the economy in rural areas where many of these workers live. In fact it isn’t being spent in any useful way whatsoever. Instead it’s being pumped into a program that will include, “skills assessment, upgrading, counseling and work experience”. In other words it’s being spent to re-train unemployed individuals aged 55 to 64 so they can find work in a different field.

Come on, in all honesty, couldn’t this money be applied in a much more efficient way than the training of older individuals for jobs that probably aren’t available where they lieve for companies who won’t hire anyone who is a whisper and a banana peel away from either retirement or the big sleep.

Hiring new employees, bringing them up to speed in an organization and helping them become a fully contributing part of a company takes a lot of time, effort and money. Just ask anyone who has a high employee turnover. How many companies are really going to hire someone that close to retirement age who has only just been trained in the skills needed for the job? Not many let me tell you.

According Loyola Hearn in a press release today, “The Government of Canada is committed to creating the best-educated, most-skilled and most flexible work force in the world, and that work force includes older workers."

I don’t disagree that the life experience older workers bring to the table is valuable and that many older people in our province have a lot to contribute, but let’s be realistic. This approach has been tried time and time again and it’s failed just as often. Re-training individuals a few years away from retirement and expecting them to suddenly have job offers piling up is the sort of wasteful spending and convoluted logic that’s cost millions over the years, raised the hopes (and sometimes the ire) of people who are already going through the worst of times, and made a laughing stock of government programs in general.

If the provincial and federal governments really believe the answer to the problem of displaced older workers in rural Newfoundland and Labrador is to throw money at it then at least do something useful with that money and buy them some bread and milk. The money will still be gone but at least the recipients will have a full stomach while they wait for a job offer that’ll never come.

Tuesday, November 06, 2007

Senate Abolition VS. Senate Reform

This week NDP Leader Jack Layton publicly called for a referendum on abolishing the Canadian Senate. Not surprisingly it’s a move that seems to be getting some support from inside the Conservative government.

Calling the upper chamber "outdated and obsolete”, with “…no place in a modern democracy in the 21st century," Layton put out the call for a referendum on the issue.

Layton’s words have some glimmer of truth in them but fixing the problem by throwing the baby out with the bath water seems a bit extreme to say the least.

For years Canadians have come to accept the fact that the Senate is little more than a vestige of a bygone era. A rubber stamp factory for federal legislation and essentially a golden retirement plan for former MPs and party faithful. But is that any reason to abolish it?

Shouldn’t the question revolve around reforming the chamber and making it work rather than doing away with it completely? It’s not like everything in Ottawa would suddenly function better and the sun would rise earlier in the morning if the Senate didn’t exist. When it comes to government dysfunction there’s more than enough blame to go around.

When Harper was elected a couple of years ago a major plank in his platform was Senate reform, not senate destruction. Many people have called for a triple E senate for years (elected, equal and effective). That’s a far cry from abolition. If full senate reform was put in place not only would the problem of a useless Senate go away but the government itself would more effectively meet the needs of all Canadians, not just those in the Ottawa/Quebec corridor.

From the perspective of smaller provinces like Newfoundland and Labrador a triple E senate might solve some of the problems inherent in finding any kind of a voice in Ottawa. Doing away with it would only serve to further strengthen the position of larger provinces by silencing the smaller ones completely.

Elected: An elected Senate (with set terms) means senators would need to go back to the people of their province or territory for a renewed mandate on a regular basis.

This would ensure that they do their job while in Ottawa (reviewing and providing sober second thought to legislation) rather than simply showing up in the chamber when it suits them, as many do now.

Anyone who has seen the kind of flawed legislation coming out of Ottawa on a regular basis lately would be hard pressed to disagree with the need for sober or any other kind of second thought.

Effective: An effective senate means different things to different people, but for me it represents a senate that is non-partisan. A Senate made up of independent members elected by the people of their province or territory without the benefit or liability of party affiliation.

Such a Senate would take party partisanship out of the equation and allow senators to truly represent their constituents, a situation sorely lacking in the House of Commons.

An effective Senate would also be one that is given the power and mandate to amend or even kill legislation if the need is there to do so.

Equal: An equal senate would provide something missing in Canadian politics today, an equal voice for all of the provinces and territories.

A newly designed senate with 5 or 10 representatives from each province or territory, each with a single vote, would ensure that no one region, regardless of population or number of parliament seats, is capable of hijacking the federal agenda for their own benefit.

No doubt there are those who believe this sort of power in the Senate would hamstring legislation and never allow anything to get done. I refuse to buy that argument. A majority of votes in the senate would be achievable as long as the majority of provincial/territorial representatives are in favor of the legislation. This is a far cry from the current system that allows passage of whatever serves to buy the most votes in the larger provinces.

With so few voices in Ottawa, can the smaller regions afford to give up even the largely ineffective ones they have in the Senate today and leave themselves fully at the mercy of MPs from Ontario, Quebec and Alberta?

No matter what the result of a federal referendum, abolition of the Senate requires a constitutional change and the support of the provinces, something that isn’t likely to happen. We’ve all seen how well the provinces agree on even the smallest of matters, but fear not, a referendum, or even talk of one, is not a wasted effort.

There is a silver lining in all of this even if full abolition is unlikely to ever happen.

With a referendum being discussed, and potentially in the offing, the topic of senate reform has suddenly moved from the back burner to the front burner for many Canadians. This may provide an opportunity to begin the process of airing public concerns and potentially moving from an unelected, unequal and ineffective chamber toward the type of elected, equal and effective one that would be the most beneficial for everyone involved.

Sunday, November 04, 2007

Federal Conservatives Out of Touch with Provinces

Are you wondering what the federal government is up to?

Has the actions taken by Ottawa (especially the conservative government) got you thinking they are on your side and on the right track?

Then you need to dig past the headlines.

To say I'm not a big fan of the Globe and Mail is the understatement of the year, but every now and then one of their columnists actually maks a point worth noticing. Although the writer clearly missed the point in reference to Newfoundland and Labrador's premier and his attacks on Ottawa, (he was already well above 70% in the polls prior to the election) what follows, from the Globe's Report on Business, is interesting

It raises points that should be considered when it comes to federal/provincial discussions. The question being, who really needs who the most. The conservatives might also want to reconsider their statement that relations between the two levels of government "have never been better in Canada".

From the Globe and Mail:

Finance Minister Jim Flaherty is a master of the headline-grabbing declaration. In the last year, he has told Canadians that Canada's total net debt will be eliminated by 2021; that fiscal balance has been restored; that a planned common securities regulator will enhance regulatory efficiency; and a that corporate income tax rate of 25 per cent by 2012 will be a powerful brand for Canada globally.

The one thing that unites all of these federal claims, aside from the fact that they make short, sweet media hits, is that they won't happen without provincial support. So one would assume that Mr. Flaherty, a former Ontario finance minister, has gone the extra mile to ensure he has buy-in from all his provincial colleagues before presenting his latest plan.

Apparently not.

Spokesmen for a number of provincial finance ministers said this week they hadn't heard a peep from Ottawa before Mr. Flaherty announced his goal of a 25 per cent combined corporate income tax rate. (Ontario's responded with some meaningless twaddle about not wanting to speculate about whether consultations had indeed occurred, but that may have been due to confusion in the new minister's office).

It points to a rather high-handed approach to the very people Mr. Flaherty needs co-operation from if he is to realize the lofty national goals he has set. Running roughshod over the enfeebled opposition parties in Ottawa is all very well. They are, after all, the opposition and would do the same if they had a chance. But the provinces should not be regarded as such if Canada is to work.

Yet if you look at the state of federal-provincial fiscal relations these days, there are lots of signs of acrimony.

Earlier this month, the government of Saskatchewan filed a lawsuit against the federal government over the equalization plan Mr. Flaherty said would restore fiscal balance. Premier Danny Williams of Newfoundland has mused about joining in on the equalization suit, but for now is contenting himself with bad-mouthing the prime minister and threatening to campaign against federal Conservative candidates in the next national election.

Monique Jerome-Forget, the Quebec finance minister, blasted Mr. Flaherty for his tactics, which she called aggressive, in pushing a common securities regulator. She suggested he should spend more time on consultations. And just about every provincial finance minister claims that they are sending more money to Ottawa than they are getting back and want the situation addressed. Some of these provincial utterances can be dismissed as political bombast.

A certain amount of federal-provincial jostling is inevitable when it comes to financial matters, especially if a province is headed for an election, as was the case with Newfoundland and is the case with Saskatchewan. Still, Mr. Flaherty must know that if he wants provincial support for his ideas, it's advisable to at least give his counterparts a heads-up beforehand, rather than forcing them to scramble after the fact.

On the matter of corporate income tax, he acknowledged that the provincial part was not his jurisdiction. But then he announced a goal of 25 per cent that he can't deliver on his own.

A cynical observer might conclude that it's the headline that matters and not the actual achievement. The lowest corporate tax rate in the G7 countries (which is what a 15 per cent federal tax and 10 per cent provincial tax would be as long as everyone else stood still) has a definite ring to it. With luck, media reports will feature that figure rather than digging deeper to see if it is realistic.

Look what has happened with the Alberta royalty changes announced last week: news reports repeated the Alberta government's claims (and oil industry gripes) even though royalty experts noted that it was mathematically impossible for the government to meet its announced targets. A less cynical interpretation is that Mr. Flaherty expects to persuade the provinces to go along on grounds that a low corporate tax rate will attract new business and allow existing businesses to flourish.

Setting aside the lack of groundwork done to prepare for this happy eventuality, there is another problem: the provinces may have other plans for their taxpayers' money. Carole Taylor, the B.C. minister of finance, alluded to this in her immediate response to the federal plan, saying she would have to see how it fit with the province's overall economic plan.

Among the challenges that all provinces face are increasing demands from municipalities for more money, the mounting cost of social programs, and aging infrastructure that urgently needs to be repaired or replaced. Any one of these may appear more urgent to a provincial finance minister than going along with Mr. Flaherty's plan to lower corporate income taxes.

In the past, the federal government could use the promise of more money from Ottawa as a sweetener when asking for provincial support on a particular plan. But the Conservative government says it plans to reduce spending in areas of provincial jurisdiction, a move that will also lessen its clout with the provinces.

The upshot of all this is that unless you are a business operating in Alberta, where the provincial corporate tax rate is already 10 per cent, don't plan on paying a combined rate of 25 per cent any time soon.

Thursday, November 01, 2007

Sizing Up The Provincial & Federal Scene

Premier Danny Williams announced his new provincial cabinet this week. There were no major surprises but there were a few smaller ones.

The ouster of two ministers, Jack Byrne and Tom Osborne, from Municipal Affairs and Justice respectively, raised a few eyebrows. While Byrne’s ouster was unexpected, the replacement of Tom Osborne in the Justice portfolio had been rumored for some time.

Osborne’s replacement, Jerome Kennedy is a respected defense lawyer and there is speculation that the former minister may be planning to run for the federal conservatives in the next election, something that would not sit well with the Premier in light of his anti-Harper campaign.

The provincial cabinet grew by two new members flying in the face of Williams promises to shrink cabinet when he took office in the previous election. This move was not overly surprising however in light of the additional provincial revenues at his disposal and after the Premier essentially offered Labrador newcomer, Pattie Pottle, a post during the recent election campaign.

During that campaign there were many indications that Williams might lose all four Labrador ridings. In an effort to shore up support he all but promised the voters that if Ms. Pottle was elected she would receive a cabinet position. After she and two other PC candidates won in the area it was difficult if not impossible for the Premier to walk away from his promise. As a result we come to the biggest highlight of the new provincial cabinet…

…Labrador now has two cabinet ministers around the table, Pottle at Aboriginal Affairs and Hickey in Labrador Affairs. In the past these portfolios were combined and often managed in conjunction with other cabinet duties. Now, both are separate and each has the complete attention of a full time minister, both of whom are from Labrador.

For far too long many people in Labrador have felt forgotten by the provincial government and with good reason. Resource revenues from the region have helped fill provincial coffers for decades yet the area has often had to stand at the back of the line for infrastructure funding and government services.

It remains to be seen if a louder voice in cabinet will actually ease Labrador concerns but it’s certainly a start. Time will tell if the big land will finally receive the same kind of treatment from St. John’s as the province itself has been unsuccessfully seeking from Ottawa for years.

Speaking of Ottawa, on the federal scene Finance Minister, Jim Flaherty, announced his fall financial update this week. In reality it was more of a mini-budget but the conservatives aren’t admitting as much.

The “update” will see a further 1% cut in the GST, personal and corporate income tax cuts and a small reduction in EI premiums for business and individuals. The most interesting part of the announcement is that the personal tax cuts are retroactive to January of 2007 meaning that they affect this year’s tax returns and the GST cut takes effect on January 1.

It seems Stephen Harper has made up his mind to force an election in the spring or early summer. Most likely they’ll accomplish this by structuring the March budget in a way that it offers a few more tax breaks they can run on yet includes something that even the Liberals, as desperate as they are to avoid an election, will not be able to sit by and take a pass on.

All the signs are there.

A week ago the Finance Minister was all over the news presenting himself as a champion for consumers after Canadians vented frustration because a high Canadian dollar was not being reflected in prices at the checkout.

The truth is that Flaherty did nothing to change this reality but by spring many prices will be in the process of falling naturally as old inventories work their way through the system and as retailers, hit by low Christmas sales, begin to force prices down. Whether a natural process or not, thanks to Flaherty’s antics, the conservative party is likely hoping for a bump when prices begin to fall in a few months.

In addition, the retroactive tax cuts announced this week will mean that spring is also the time when many taxpayers will receive a bigger tax refund than they would have otherwise. Spring is also the traditional time of year when large numbers of people consider two of the biggest purchases any of us ever make, automobiles and homes. Though the GST cut introduced this week will save the average buyer very little, anyone buying big ticket items will see substantial savings at a very opportune time for the Harper government.

The conservatives appear to be strategically aligning their stars in order to best position themselves for a spring majority election win.

As one opposition MP recently put it recently, “Don’t be fooled and make no mistake, the conservatives claim to be governing but they aren’t. In reality they’ve been campaigning ever since the last election.”

I guess it’s nothing new under the sun for a government to buy votes with the taxpayer’s own money, but the conservatives are clearly more strategic, calculating and subtle about it than governments have been before them.