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Wednesday, January 21, 2009

Federal Budget Will Do Litttle for NL Economy

With less than a week to go before the Harper government brings down its much anticipated budget, speculation about what it will contain is rampant.

Across Canada Provincial Premiers, Mayors, lobby groups, business interests and individuals have spent weeks pushing for their piece of the pie. With just a few days left to go the question is which line items will actually appear in the Harper stimulus package and how will it be distributed across the land.

The most likely outcome of next week's budget will see the Harper Conservatives deliver a two pronged approach with support for ailing industry sectors and individuals across Canada as well as a pot of money for infrastructure spending in specific regions.

Unfortunately, even if this broad approach is taken, it will mean very little for Newfoundland and Labrador and here’s why.

Industry Specific Support:

The sectors being most often discussed and touted as needing federal support are manufacturing and forestry. Neither of which are prevalent in Newfoundland and Labrador, with the exception of the Corner Brook paper mill. Abitibi has already decided to close its doors in the Province and nothing is going to change that.

The fishing industry needs massive support. Not necessarily direct cash injections but with the collapse of the Icelandic banking sector, which has provided cash flow to the industry for years, loan guarantees or some other form of funding needs to be made available before the new season begins or the industry will be in dire straits.

Unfortunately the fishing industry has never been more than an afterthought during Ottawa’s discussions about industry stimulus and as a result will likely find little, if any, support in the new budget.

Individual Support:

When it comes to assisting individuals the federal direction seems to be focused on middle class tax cuts and the EI system.

Liberal leader, Michael Ignatieff (Iggy to his friends) has already said he won’t support across the board tax cuts. I can’t say I blame him on that point however since a small tax break that adds an extra $5 or $10 to an individual’s paycheck isn’t likely to make them rush out and gleefully spend the economy out of recession.

As for changes to the EI program that’s an entirely different kettle of fish but...

The EI fund has been so mismanaged and abused by Ottawa over the years that there may not be enough left in the pot to support the massive numbers of unemployed about to enter the current system, let alone one that has undergone an overhaul.

Even with an influx of new funds from Ottawa the most likely changes possible will be to shorten the waiting period by a week, extend the benefit period and lower the number of weeks required to qualify in certain areas.

Currently anyone living in places like Toronto, for example, requires more weeks to qualify and they are eligible to receive benefits for a shorter period of time than someone say in Newfoundland and Labrador.

The reasoning behind the existing approach is simple. Ontario has an unemployment rate of just over 6% while Newfoundland and Labrador has a rate of over 13%. As a result, under normal conditions, it ought to be much easier to find a new job in Toronto, in a shorter period of time, than it would be in Newfoundland and Labrador, but these aren't normal conditions.

With the economy the way it is these days finding a job, even in Toronto, may not be quite as easy as it once was. With this in mind any extension of benefits or lowering of requirements will likely bring places like Toronto in line with places like Newfoundland and Labrador. There’s nothing wrong with that under the circumstances but once again, it does nothing to help the economy in Canada’s Far East.

Regional Infrastructure Spending:

The third prong of a likely Stephen Harper stimulus package is infrastructure spending. Once again there will likely be very little benefit here for the Province of Newfoundland and Labrador.

It's not that the Province doesn't have any infrastructure needs, far from it. There are projects that have been on hold for years and are more than ready to go. The Trans Labrador highway immediately springs to mind as does rural broadband, bridge repairs and many other initiatives.

The problem for Newfoundland and Labrador is that the Premier’s of vote rich provinces like Ontario, Quebec, Alberta and BC have been lobbying hard to have their infrastructure needs met and they contend that the best way to distribute funding is on a per capita basis.

This would mean that Ontario and Quebec, for example, with more than 60% of Canada’s population would capture an equivalent amount of the funding.

Newfoundland and Labrador on the other hand would get somewhere in the order of 1.5% of federal infrastucture funds intended to get people working, even though the Province has the highest unemployment rate in the Country and when Canada's newest so called "Have" province is facing the potential of upcoming deficits.

Indeed there is likely to be very little in the way of stimulus for the Newfoundland and Labrador economy at a time when mills are closing, mining giants are cutting production and black gold has lost more than two thirds of its value.

On January 27th all across Canada, from Vancouver Island to Halifax the masses will gather around their T.V. sets in an effort to parse every word dripping from Jim Flaherty's lips only to wonder what it all will mean for them and theirs.

Author’s Note – Usually I’m the first person to jump on my soap box when a statement like “…across Canada, from Vancouver Island to Halifax” is made but in this case the term was intentional rather than bred from ignorance or neglect.

When you consider the likely outcome of the federal budget, what reason is there for anyone in Newfoundland and Labrador to bother tuning in on that day unless they're so desperate for help they want to be the first to discover the value of whatever table scraps are once again tossed their way?


Anonymous said...

I will pose some questions after my statement.

With the high unemployment rate that has been rearing its ugly head in the province of Newfoundland and Labrador, almost since we became part of the Canadian Federation, when compared to the other provinces of Canada, and given our rich natural resource base and great strategic geographic location; what have our politicians done to positively move this province forward economically to rid ourselves of such chronic unemployment?

Why, when an Unemployment Economy was the type of economy which was created by Ottawa for NL, is Ottawa not even trying to address the problem in these dire economic times by making the EI System a little more fairer for the people of NL, since Ottawa created the monster economy in times when there were no need for that type of non-economy to have been created? Ottawa oversaw that our resources were sent to the provinces of Canada that needed our resources, but, of course, our our provincial politicias should have stopped it. There must have been something in it for them to have let things slide. What could it have been?

Are there officials out there in the Federal and Provincial Governments presently who are trying to take the province out of the Economic trajectory in which it has been orbiting for more than 40 years now?

These are questions that need to be put forward to the Canadian Government Leaders and our own Provincial Goverment.

I don't know of any bureaucrats or politicians who are tackling the economic conditions which exist in the province of NL, by that I mean they are trying to take us out of the economic orbit that we have been travelling through for far too long, do you Myles?

If there aren't anyone out there dealing with these problems, we should darn well start asking pertinent questions on the matter, since it appears from the Federal Budget that you are writing on in this article, that nobody cares about whether the province of Newfoundland and Labrador is look after in those dire times or whether it develops a real market economy or not.

Why aren’t people opening their mouths to ask our politicians, past and present, to give us an answer as to what went on to have put the province of NL and its people in such dire straits?

I find that very puzzling considering that the province of NL was well endowed by nature with a great natural resource base and very fine strategic geographic location.

Where are the politicians and why are they not concerned? I am shocked to my core!

And why are there so many Spin Doctors out there trying to camouflage what happened?

These are perennial questions which we need answers for, since we need to be able to turn the economic situation around in the province of Newfoundland and Labrador.

Until we know the reasons why things turned out the way that they did for the province of NL, we will never be able to fix the problems.



Anonymous said...

In this new world economy Patriot why is Newfoundland and Labrador being left out in the cold? The world is screaming for clean energy. Energy that is abundant in Labrador.

Soon the effects of all these mine closures will be felt across the Labrador. Where is the people’s government? I can tell you were it is, it’s in Ontario and Quebec.

Why can the federal Government of Canada not give a simple loan guarantee to the provincial government of Newfoundland and Labrador, because the feds are backing Ontario and Quebec? Let’s forget about all the jobs that can and should be created in the province. Job’s that are sustainable. Job’s of the future.


If we let Newfoundland and Labrador get ahead to much then newfie won’t want to go to Fort Mac and make Alberta bloom like Holy blazes.

Anywhere Newfoundlanders and Labradoreans go they are known for their great work ethic and their skills. It sure beats having to go to the Philippines or Mexico and grabbing Wean to come up and work in the oil sands. Damb right they want Newfie to come out and build their economy for them. They did a great job for Ontario so why can’t they do it for Alberta right.

For an economy to work Patriot you need the people there to support it. You need the people to buy the products. You need them to spend their money in that region.
Don’t you kid yourself for one minute Patriot, the Evil Empire known as Canada knows that it cannot survive with too many nations in its borders? They can’t get rid of Quebec because they have risen up to see what Ottawa and Canada is all about. So they have to cipher off what they can form other parts of the empire, like Newfoundland and Labrador.

I have a simple question for any of your readers Patriot. First I ask that your readers watch and analyze what is being done in Germany, and while you are watching this video from the CBC, I would like to ask you “why can this not be done in Newfoundland and Labrador.”

They don’t want us to keep our culture Patriot, they want it to go away and die like the Cod fishery. When you stop listening to the spin doctors and the liars amongst us, it’s as plain to see as the noise on your face. They don’t want a healthy and prosperous province. They want you and me to shut up about all the wrongs that the center of the empire has done. They want your history to pass away with your father.

All this time we thought that America was the evil empire. America has grown to a great nation. Maybe we chose the wrong country to join in 1949.

President Obama, I too have a dream, but this is Canada and I fear you have to be American for those dreams to happen.

Anonymous said...

Myles, I am searching for the truth and I can't seem to find it.

I want to know why a land mass, which was coveted for 80 years by Canada, now known as the province of Newfoundland and Labrador, a land mass which held great potential with an excellent geographic location and wealth of natural resources,end up, once being a part of Canada, to be economyless and the joke of the Nation.

Why after 60 years of being part of Canada did someone, somewhere in the country not figure out that something was drastically wrong with the picture, for a province like NL with the correct attributes to have to rely on an Employment Insurance based Economy?

NL's natural resources have been used to create economies in the heartland of Canada, why couldn't they have been used to create economies in NL?

Anywhere in our beautiful NL a manufacturing or any other type of industry could have been established, since every part of it is situated on the on the sea route or land route.

Most of the world's goods are shipped through Ocean travel? Why did we believe the lies we were told us that our location was too far off-base?

Don't you think that someone in one of the Governments, either the Federal or Provincial, should not have noticed and asked why the province of Newfoundland and Labrador couldn't get an economy started? We weren't situated in outer space, but even in outer space today a lot of business can be conducted, especially information technology.

Myles, if I were part of the government, either provincial or federal, I certainly would have asked such a question.

If I were a politician or a bureaucrat, there is no way that I would have allowed one natural resource to be released from my province in its raw, unrefined stated, unless it benefitted my province through creating a real economy.

As a result of everhting being shipped out in the raw state, my province has had to rely on Employment Insurance, while the other provinces that received our resources earn the credit for building real economies?

What mindset did the politicians whom we elected possess and what did they get out of it to have allowed that to happen?

I think if we could get truthful answers to my questions, we would find out why it all happened.

We must keep asking the questions until the politicians of today get the drift.

It must never, ever be allowed to happen again. After all we elect our politicians to look after the needs of our province, not those of the other provinces. They have to get the message.

Anonymous said...

maybe we should just sit and chill ,and say " F@&k-It" and give Up !!!


I'm an endangered species ,"F@&k the Seals"

Save Newfoundland And Labrador ???

I dont Believe this.

Anonymous said...

It is time for Newfoundlanders and Labradorians to wake up to the reality that the sorrowful economy which exists in our province was by 'design', it did not occur naturally.

By that I mean, when one of Newfoundland and Labrador's natural resources was tagged to be uncovered from the ground or the ocean, it was already old news in the industrial circles of Central Canada, and the resource was already bargained for and some place West of here already had its design written all over it, long before we in Newfoundland and Labrador even knew it existed.

Now with dealings like that, how is it a fault of the people of Newfoundland and Labrador that we ended up with such an impoverished real economy? For God's sake NL's resources already had a 'promise ring' on them long before Newfoundlanders and Labradorians knew they existed.

I am not blaming this solely on everyone West of here, since some of our politicians had to know what was transpiring, and I have to blame them as well, whoever they were, for complicity for whatever way our natural resources were dealt out, especially when they were shipped out of our province in the raw state.

It is time that Newfoundlanders and Labradorians stood up and asked a few questions on why our politicians created the economic mess that they did.

If the ordinary Newfoundlander and Labradorian had put pertinent questions to their politicians in the past, I think they would be much better off today.

It is also time we asked a few questions on the upcoming Federal Budget and why that Budget will leave us impoverished again, for that which the ordinary citizen of Newfoundland and Labrador is not responsible for.

Are we, as ordinary citizens, going to forever remain mute without voicing our opinions to the World on the overall economic mess that we find ourselves facing everyday of our lives?

Why are Newfoundlanders and Labradorians so complacent? Might it be that they have been spun by the spinners too often and they get caught up in the spin every time? In other words they are so trustful, they cannot decipher truth from fiction?

twjtNL said...

All of you are spot on. We do need to start asking ALOT of questions! Myles, I constantly ask myself why I'm so engaged on NL issues... why, when I read your posts and others, do I become so fiery and bothered. But I know exactly why I do.

Like you and many many readers of your blog, my heart breaks to see the place that made me who I am today be constantly abused and gradually loosing what it is that shaped and moulded us.

Not only on an economic standpoint, but also cultural. I remember when I was in grade 4, growing up around the bay, teachers of mine would force us to pronounce words 'properly'. If we didn't say it the way Canadians do, we would lose a gold star. It wasn't until I was in college that I actually clued into what had happened, and it wasn't until college that I actually started learning things about NL that absolutely shocked me to my core!

My point is that I'm tired of getting so angry and frustrated to the way things are, and I'm ready to see real action being carried out.

A letter needs to be written and sent by ALL OF US to key ministers of government, both provincial and federal, asking for change to the treatment of NL's resources, economy, etc. Something needs to be done here.

Myles, I believe you're the guy to get this started. You're well-informed on the issues and you're able to get them down on paper properly.

Am I completely off with this?

Patriot said...

Hi twjtNL,

I fully understand your frustration, I feel it myself all the time. Unfortunately the process of writing letters has been tried by yours truly and others in the past, it only falls on deaf ears.

There is nothing wrong with doing it but don't expect any kind of solid result (or even a response in most cases.)

You might be better served to become more politically active. Join a political movement, join a lobby group, perhaps even start one.

Participate directly through protests or petitions and the like.

The one thing we must never do is remain silent. Even if that means informing one individual at a time in your circle of friends.


Anonymous said...

Patriot - The next time a Federal MP’s seat becomes available in Ottawa for Newfoundland and Labrador, I would suggest that you run for it.

I cannot think of anyone who knows the deficiencies of the province of Newfoundland and Labrador as it relates to Canada any more than you do. Matter of fact Patriot I can think of absolutely nobody who has half the knowledge that you do, and who is willing to make it public. Having the fortitude and the honesty to make things public is what is needed.

I would like the Federal Government to become more honest in their dealings with the public of and do away with the jobs it creates for the Spinners, more commonly referred to as Consultants. The title Consultant is a title put on the Spinners so as to camouflage what their job is.


Patriot said...

Thanks for the kind words and vote of confidence Anon 5:15pm but there are far more qualified people than me in the province.

Unfortunately many of them, like myself, don't have the hide for the job and are unwilling to prostitute themselves in Ottawa.

There are some who have tried through a locally run party, NL-First, and are still trying but it seems, based on the support that party got in the last federal election, that the truth is still taking time to get out.

Who knows, if we all keep on telling it like it is maybe one day we will find a way forward.

To borrow a line from the band Pink Floyd - "Hey you, don't tell me there's no hope at all, united we stand, divided we fall"

Anonymous said...

Patriot, you not only possess the fortitude to tell the truth and possess an intense love for Newfoundland and Labrador which parallels my own, but Patriot you have more, and that is something which I, and many others, do not have, that being the ability to be an MP.

I cannot see anyone with more ability to represent our province than you. No Sir - Not one.

We need brashness, confidence, honesty and someone who possesses a true desire for our province to move forward economically.

But first of all Patriot you have to introduce yourself to your subjects, Newfoundlanders and Labradorians. I doubt very much that many of them have read your blog or even know of you, simply because they are not aware that it even exists.

I really don't like saying this, but because of the 'smoke screen's which have been so efficiently thrown up by the 'Consultants aka Spinners',(they are as good at SPINNING Patriot as you are at telling the TRUTH about the history of what has transpired),because of the Spin Factor, I feel very few Newfoundlanders and Labradorians even know that you exist.

I would love to hear you call Ryan Cleary, the host of VOCM Night Line and introduce yourself to the Newfoundland and Labrador public by giving them an accounting of how you have seen things come down the political chute, in the same manner which you have related it to those of us who have read your blog entries for years. Thanks for the information Patriot and please keep up the great work.

Patriot for MP!!!!!!!!!!!!!!!!

Anonymous said...


My fervent wish is that we can inform the electorate of Newfoundland and Labrador, in other words our colleagues, that there are paid Spinners out there, and unbeknownst to all of them, even myself until recently, most of them don't know that they have been spun royally all of their lives. They also need to know that Spinning has been ratcheted up a few notches since the Atlantic Accord debacle.

Those Spinners have infiltrated every aspect of our lives through the News Media, (Newsprint, Radio, Television and even the Blogs), and if our fellow Newfoundlanders and Labradorians are to become aware of the presence of such Deceitful Enablers of Governments and Industries, which utilize such tactical people to make matters non-transparent, they are at a lost to counteract it.

As a consequence of such awareness our people can begin the journey of becoming equal counterparts in Canada, BUT FIRST THOUGH, they have to be apprised that they are fighting an UPHILL BATTLE, waged by the SPINNERS, who are paid by entities, of only God knows who. They have to be reminded that their Governments are involved in the support of the Spinning methods, as well.

It is an article which needs to be written, and once our people know that there is such an Institution, as the 'Spin Institution' operating out there, working diligently against their wishes, they will take notice and put two and two together, as to why this beautiful, geographically strategic province, which was well endowed by nature with coveted natural resources, has failed to thrive.

I recommend to anyone who wants to become aware to download and listen to Ira Basen's 6 part series on Spin which he did for CBC Radio titled The Spinners and the Spun.

It is quite in detail and will open your eyes and ears to what deceitfulness goes on.