Here's to the crazy ones, the misfits, the rebels, the troublemakers, the
round pegs in the square holes... the ones who see things differently -- they're
not fond of rules... You can quote them, disagree with them, glorify or vilify
them, but the only thing you can't do is ignore them because they change
things... they push the human race forward, and while some may see them as the
crazy ones, we see genius, because the ones who are crazy enough to think that
they can change the world, are the ones who do.

Steve Jobs
US computer engineer & industrialist (1955 - 2011)

Wednesday, December 31, 2014

Predictions for 2015 - Not a Pretty Picture

Last year my New Years predictions were for a "tumultuous, history making year". So this year I thought: "Well b'y, better be more specific."

For Newfoundland:

1. Halt of the Muskrat Falls project in the Courts.

2. Resignations of  Ed Martin and Gilbert Bennet, and a large scale purging at Nalcor.

3. A Liberal government so large that it has to appoint its own members as Opposition ala Frank McKenna.

4. Large scale cuts to the civil service, and project spending.

5. A huge downturn in the economy reflected in high unemployment numbers and falling real estate prices.

6. A serious downturn in Labrador's mining, exploration, and economy as a whole.

7. Wide spread anger throughout the land.

For Canada:

1. A new Liberal dominated minority government, caused by drops of support in Ontario and BC for the Conservatives, and the NDP maintaining a strong hold in Quebec. Canadians won't trust that Trudeau is ready to run the show without the strong hand of Mulcair to keep him in check.

2. Declines of oil markets in Saskatchewan, Alberta, and here are too large to offset export gains in Ontario and Quebec, and the country enters recession.

3. Northern sovereignty is challenged by Russia, and to a lesser extent others.

4. Aboriginal rights and militancy increase dramatically over living conditions and resources.

5. Political unrest and economic decline make Canada a very unstable place to be, but then the world mirrors it.

For the World:

1. Russia and China escalate the stakes in their economic war with the US. They create formal international structures, based on the Chinese Yuan, to reduce US influence in the developing world.

2. Turkey leaves the NATO/ US sphere of influence and moves toward the Eurasian Alliance - fueled by disgust over Israeli treatment of the Palestinians and greater economic prospects with Russia and China.

3. The war in Ukraine escalates and Russia intervenes militarily. The Ukrainian government falls.

4. Europe enters a period of deflation and recession, that evolves into depression.

5. Argentina attempts to retake the Falkland Islands.

6. The United Kingdom begins the process of leaving the EU.

7. Investors in the US stock market panic over events in Europe and loss of trade markets, sell off, and cause the largest single crash of the the stock market since the 1920's.

All in all, not a very happy or positive outlook on the year 2015. Sorry for that. It's probably just as well that none of us have a crystal ball and can see the future, but, for what it's worth, this is my attempt. Seems to me that we can't avoid the economic realities that continue to unfold around us. The best we can do is try and protect our own. On the upside, every collision of history has always resulted in a better result down the line, so keep that in mind as we weather the storm that will be 2015.

Sunday, December 28, 2014

A Letter to the Premier

It's not often I would give advice to a PC member of this Province's government. In fact, a big part of me would be happy to see them all gone. However, that may not be good for our democracy in the long run. With the NDP flailing like near dead fish in the back of the boat, the political choices here have become uncomfortably narrow. Not only is a small or non-existent Opposition bad for the democracy of our province, it's also bad for the winning party - as Brian Mulroney found out. It's one thing to have the bragging rights to the "largest majority government ever", and quite another to satisfy all the egos that get swept in with it. Not everyone can be a cabinet minister, or parliamentary assistant, yet they all think they should.

So, in the spirit of the season, and bipartisan concern, here's a few words of advice for our erstwhile premier:

1. Drop Muskrat Falls like the dead dog it is. Use whatever excuse you want. It could be the court cases going through the system now with their impending damnation of the foolish actions of the Williams' administration. Be the bigger man. Own up to what every one else is already thinking. Put the people before your own ego. It's the ego that's killing you. Not yours specifically, but the ego hangover from the Williams' regime, the nagging egos of some of your long-time ministers, and back benchers. Be humble. Be contrite. Be honest. Stop the development for at least five years to get the Province's nightmarish financial and demographic position as righted as it can be. Do not govern with malice. Blaming Hydro-Quebec for everything is old. Everyone knows they're bastards, but nobody wants to sacrifice the Province or themselves on that alter. Stopping Muskrat Falls immediately is your only prayer.

2. Repeal Bill 29. It has come to symbolize that ego we spoke of above. The secrecy. The deception. The breach of trust. It is all the things that your government has been convicted of by the people, and for which you await sentencing. Even the press hate it, and that's never good for your business.

3. Ban corporate and union political donations. Restrict individual donations to $50.00 per person. The route of your entrapment is the dollars you take in and div out. So much so that one MLA, with uncommon courage in the legislature, commented publicly about a "stench of corruption". It's not news to us, but you could show leadership by addressing it.

4. Differentiate yourself from the past. Every time you say "our government has" you add another nail in the coffin. Guilt by association. People don't need to wonder if you are the same as the old crowd, because you tell them you are. While that kind of talk may get you a few slaps on the back by party hacks, those same hands, from those same people, will be thrusting that steel blade in your back the moment the party goes down in flames.

5. Know your limitations. You aren't super man, and there is nothing special about you. You aren't a visionary, and you don't inspire with your words. You are a retired cop who worked himself into the leadership, during an unprecedented party blood bath, and entering the kind of political hell that is not often realized by even the most deserving governments - which your's is of course. And you look that part. The glasses intended to portray a "smart premier" impression aren't going to do it for you, although it's a nice touch.

The only, and I mean the only, hope you have of saving ANY PC seats in the next election is to follow these simple words of advice. Are they difficult? Yes. But so is leadership. When Churchill's England was being bombed into oblivion, leadership was difficult. Freeing slaves in the US was difficult for Lincoln. Staring down Quebec separatists was difficult for Chretien. By way of example, the above steps are pretty tame. So, to save your party to the extent of opposition status, or perhaps even minority status, you need to show leadership on the things that matter. Not bike helmet legislation. Not this- that-or-the-other day proclamations. None of that. That only reinforces the idea that you've just "quit and stayed on". For what it's worth, in the spirit of democracy and bipartisanship, there it is. A few words of advice.

Friday, December 26, 2014

Ukraine - the US is at fault

The evidence is in, and there is no question the United States government sponsored the coup that led to the ousting of Ukraine's elected President. No doubt he was unpopular Western Ukraine, where the seat of government is, and where most people did not vote for him in the previous two national elections. All that is true. However, in the "modern world order" we don't sponsor coups of elected governments. We even find it meddlesome when "unelected" dictators are overthrown by US sponsored coups. We know by history that once the dictator is overthrown, the threads of that society fall apart like shattered glass. A few current examples are  Iraq and Libya - there are others.

The point is, in the "modern world order" the US should not be destabilizing and overthrowing democratically elected governments - yet it is. On the one hand, the US claims to be the moral high ground  that all should emulate and is the "police force" to ensure it happens, and on the other hand it violates the moral high ground whenever its "national interest" is threatened. I put national interest in quotations as it doesn't have a strict definition. It's just whatever suits the US at the given moment in time. That one thing is the fatal character flaw of US policy - "we are just and right" when it works for us". The problem with that notion is that every moderately powered country could take the same position. The lesson the US has apparently not come to grips with is that the rules apply to it as well - perhaps more so. If you claim to be a world leader then you have to lead, and leadership is by example not convenience.

As the Sochi Olympics in Russia began, a nationalistic moment of pride for Russians as it is for every home country, trouble came to the surface in Ukraine. Not surprising I suppose considering the Saudi foreign minister's comments to Putin that if Russia gave Saudi its way in Syria, well then Saudi would make sure Russia had no problems with terrorists during the Olympics. All that did was infuriate Putin, which you could understand - essentially terrorist blackmail. And, while the terrorist situation remained well in hand during the Olympics, the Ukrainian "uprising" exploded from smoldering discontent to a demand the government join the EU. Ironically, even after agreeing to sign the agreement to establish economic relations of a sort with the EU, the Ukrainian president was still overthrown.

It was all quite clearly organized, funded, and even armed by "western entities". The US, instead of condemning the overthrow of an elected President, simply applauded along as "the people spoke". Yet, in a near identical situation erupting in Egypt, where the army slaughtered thousands of protesters in a matter a of week, the US refused to call the matter a coup - which would have cut off arms money. That's the kind of pragmatic vision that costs you the high ground and leadership. The same thing happened in Libya when NATO air forces went from a UN sanctioned mandate of a "no fly zone" to become the "rebels" air force and destroying the Libyan armed forces on the ground. Another breach of trust. Another abuse of power. Another loss of integrity.

As could be expected, Russia would not stand idly by and watch the US, and for that matter NATO, come to dominate a country right on its border. That should not be a surprise to the US given its 50 year economic boycott, and attempted invasion and naval blockading of Cuba. In fact, the US banked on it. When Russia intervened with special forces, a naval blockade of Crimea, etc the US protested that Russia would face a "cost" for its actions. The cost was to be escalating sanctions aimed at destabilizing and perhaps  over throwing the Russian government  - certainly at a minimum destroying its economy.

It's important to remember that the Ukraine conflict is not about Ukraine, or the fact it is on the Russian border. That is simply the means to the "end". The "end" is a direct blow to the Sino-Russo economic alliance ( mostly referred to as Eurasia). At some point in time the US had to decide whether it would accept losing its international economic superiority, or fight. There are only two ways to fight. One is an economic war. The other is a real war. Of course, the US could obey the rules of world order and accept the ascension of China, including the Russia-China-BRIC alliance. It's happening anyway. For example, India just signed a deal with Russia to build 12 nuclear reactors, and it cancelled a deal with US ally South Korea for a $1 billion minesweeper contract. The message: if you are with the US you aren't with us, and we have the money. A definitive sigh of things to come.

Meanwhile, in Ukraine, four or five ceasefires have come and gone. The Ukrainian government, funded and supplied by the US, has used the ceasefires to advance their lines in the Republics of Donetsk and Luhansk. They created a massive incursion to the north of Gorlovka south toward Luhansk city and just north of the Donetsk/Krasny Luch defensive line. Not to be outdone, the Novorossyian forces have forced themselves to the eastern outskirts of Mariupol and westward of Alchevsk. Donetsk city has been mercilessly shelled by the Ukraine army, and the Novorossyian forces have taken a shaky control of most of what's left of Donetsk international airport.

There was meant to be peace talks between the two sides today in Minsk. It never happened. Instead, the Ukraine government cutoff power and rail links to Crimea. Also, just days ago, the Ukraine President stated publicly that Ukraine would apply to be part of NATO. All part of a war that isn't meant to end, and that isn't really declared for what it is. In many ways it's starting to resemble the "war of annihilation" the Nazi's waged against the then Soviet Union. Not in the sense of magnitude, yet, but in nature. There is no will on either side in Ukraine to surrender, or even submit to the other's authority. Too many people have been killed and maimed. Too many lives have been burned by the flicker of the flame fueled by hatred.

There is no peaceful end for the Ukraine situation. None. One side or the other will prevail, but Ukraine will not rest unless it retakes Luhansk and Donetsk Republics. The Russians will not allow that to happen. In two days the Russian army is supposed to roll into Donetsk and Luhansk to come between the Novorossyians and Ukrainians as peacekeepers. In reality, they are making themselves targets of opportunity for a Ukrainian government bent on revenge and well supplied by the US to do just that. All of which points toward serious escalation, and perhaps all out war. If that happens, the Russian military will destroy the Ukrainian military within a week. The only question that remains is where does it go from there. As Henry Kissinger explained in an article published today:

"Public discussion on Ukraine is all about confrontation. But do we know where we are going? In my life, I have seen four wars begun with great enthusiasm and public support, all of which we did not know how to end and from three of which we withdrew unilaterally. The test of policy is HOW IT ENDS, not how it begins."

What Kissinger, the US government, and many other people are not considering enough is:

"What if it's not left upto the United States to decide how it ends. What if the US loses it all?"

Saturday, December 20, 2014

Danny Williams in Contempt

Without Prejudice

This past Tuesday I was in front of Justice Orsborn requesting a date be set to hear my application that Danny Williams' lawsuit against me for defamation be thrown out. The grounds for striking the lawsuit were that Williams accepted being named to a court house building in Corner Brook that houses the chamber of the Trial Division of the Supreme Court of Newfoundland and Labrador, and through which justices of the Court rotate through as part of their duties.

Justice Orsborn, quite seriously, put an end to the Court's involvement in the matter. He stated that neither he, nor any other justice of the Trial Division would hear the case, and that he had requested Chief Justice Green of the Appeal Court appoint an Appeal Court Justice to preside over the matter. In effect, Justice Orsborn recused himself and the entire Trial Division from hearing the matter. I was surprised. Williams' lawyer was in a state of shock. Then came the big one. Orsborn continued by saying he had written former premier Marshall on the naming issue, and had decided to give counsel a copy of the letter. The Court Clerk dutifully delivered us each a copy sealed in a vanilla-type envelope.

The letter, which is below, essentially raises many of the same concerns I had over the court house naming after Williams. Kind of common sense stuff, which doesn't seem to be so common in the Government of this Province.

I made the decision to release the letter to the media, because, in my mind, it was a very real matter of public interest, and a classic example of abuse of power and position. It most importantly illustrated that the sanctity of the Courts could be violated by politics, which then brings the independence of our court system into question. This is especially true given our judges are appointed by politicians. In effect this takes on the perception that powerful politicians become judge, jury and executioner.

The story went across the country. Williams, belatedly spoke to the issue. I was almost as shocked by his response as I was of the similar theme between Justice Orsborn's commentary and my own argument.

Williams actually attacked Justice Orsborn's integrity.

Here are some samples of what he said:

" Obviously, this Chief Justice Orsborn had an issue that he had dealt with privately, unsuccessfully, and then basically through another vehicle (that would be me) decided to table it and make it public"

Now, if I was Justice Orsborn, Williams would be waking up this morning in jail. Parse the above statement. " 'This' Chief Justice Orsborn." Really? As if he is speaking down to one of the top judges in the province, like a petty little school girl. Then, in the remainder of the sentence he accuses Justice Orsborn of willfully and with malice of using his courtroom and position in a way that would be an abuse of the bench. In my way of reading, if that isn't contemptuous of the position of Justice Orsborne, and the Court, then I'm not sure what the meaning of contempt of court would be. Black's Law Dictionary defines contempt of court: Contumacy; a willful disregard of the authority of a court of justice or legislative body or disobedience of its lawful orders. Contempt of court is committed by a person who does any act in willful contravention of its authority or dignity.

 I'll go with that last one. Willful contravention of the dignity of the Court. Also, It would also seem to me that Justice Orsborn has a very strong, and likely very expensive defamation case against Williams if he wants one.

"there were other judges there and: They didn't see anything wrong with it, but obviously Chief Justice Orsborn has a different opinion. That's probably the nicest way I can put it." So now Williams, typical to form, is pitting people against people to try and win a point. The problem with this particular comment is that he's referring to Justices of the Courts. It's as if he is not conscience of the fact that Judges shouldn't be endorsing political events. It's as if he doesn't care. It's as if "hey, everyone else is doing it, so it must be right, and you must be odd man out." It's childish and it's stupid, and it's contemptuous of the positions that judges hold, and have to hold, in our society. All this from a man that purports to hold a law degree.

The Newfoundland and Labrador Law Society describes these 3 criteria for it's members:

2.1-1 A lawyer has a duty to carry on the practice of law and discharge all
responsibilities to clients, tribunals, the public and other members of the profession
honourably and with integrity

[2] Public confidence in the administration of justice and in the legal profession may
be eroded by a lawyer’s irresponsible conduct. Accordingly, a lawyer’s conduct should
reflect favourably on the legal profession, inspire the confidence, respect and trust of
clients and of the community, and avoid even the appearance of impropriety.

2.1-2 A lawyer has a duty to uphold the standards and reputation of the legal
profession and to assist in the advancement of its goals, organizations and institutions.

Seems quite obvious to me Williams has not followed these rules of his profession.

Williams is also quoted as saying:

"I was quite surprised, you know, that a current chief justice would have sent a letter to the Premier raising an objection, because you know, there's a clear distinction between the role of the executive branches of government, and you know, that crosses the line."

Really? What line? Williams' line, because Williams wants the ego trip of having a court house named after him? It's clearly a constitutional requirement that judges protect their independence from the appearance or perception of bias. You would think Williams would know that. Still, he ridicules the Chief Justice.

Then in an attempt to show just "how normal and non-controversial" the naming of the court house after him was, Williams says:

" The Court House in Grand Bank was named after Chief Justice Hickman who was the former Minister of Justice in either the Smallwood or Moores era I think, but he was alive at the time and of course there wasn't ever an issue with that, so."

Williams conveniently doesn't mention that after his political career, Hickman was Chief Justice for 20 years until he retired. Whether that remains a correct thing to do or not is up for debate, but it in no way compares to Williams situation. Justice Orsborn assessed it as such in his letter to Marshall.

All of this is the way Williams has attempted to rule Newfoundland and Labrador since at least 2003. Pit people against each other in an attempt to humiliate and marginalize his opposition. Ignore realities that don't suit and manipulate arguments to suit the purpose. Threaten those that disagree by accusing them of "crossing the line". For myself and the Telegram provincial newspaper that meant being sued by Williams for defamation. For Chief Justice Orsborn it apparently means being derobed of your judicial dignity and independence publicly by a man consumed by his own image - as he sees it.

It is time for Danny Williams to be brought down a whole lot of pegs. It's time that his abuse of his public position as former premier, that is to say using that position to threaten and demean those that see things differently than him, to end. Attacking a well-respected, extremely experienced and highly intelligent Justice like Chief Justice Orsborn is an outrage. Williams should be dragged through every editorial column in the land for even daring to attack the integrity of a Chief Justice. The Court should defend the honour and integrity of Chief Justice Orsborn, and its own, by throwing Danny Williams into jail for contempt, so that he realizes that nobody is above the law. Yes, not even Danny Williams. Or, perhaps, especially not Danny Williams. We have to know that the Courts and the media aren't afraid of the little man from St. John's.

Thursday, December 18, 2014

Putin Plays the West

It's early days in the battle I often refer to as the "Gold War". Russia and China, having announced their intention to form a new Eurasian economic order, inclusive of India and other BRIC nations, are now fending off blows from the West. The Russian ruble, currently pegged to the US dollar, has been taking a hammering as the US and more specifically its ally Saudi Arabia, glut the world oil market forcing a massive decline in the price per barrel. One has to assume it's part of the "price" Obama said Russia would pay for its intervention to materially support Eastern Ukraine (Novorossyia) separatist forces. That's just on the face of it though.

Consider and remember that China is the bank and Russia is the sword of the new Eurasian alliance. The goal of that alliance is not to do well under the US dollar, but to replace the US dollar as the world's reserve currency with either a new currency or the Chinese yuan. That is important. Both China and Russia have large reserves of foreign currency - in Russia's case nearly $500 billion.

Then consider Russian President Putin. He rose through Russia's power ranks as an intelligence officer. That is one of three important pieces of the pie. That means: he uses deception and part truths to achieve an end; he is disciplined and demands the same of others in his circle; he is ruthless and flexible in achieving his goals; and he will never crack. Secondly, he is a judo master. That means he uses movement and blocking to defend against blows, but most importantly he uses the energy of his enemy as his own to defeat an attack. That part is critically important to remember. Finally, he is Russian. Russians have a proud place in world history due to the massive and brutal sacrifices they have made along the way. The most recent of which was the 25 million Russians who died during World War Two while ensnaring most of Hitler's armies, and giving the other allies time to organize and become engaged. Russians are used to sacrifice, and are super sensitive about the "Motherland" being prosecuted by foreigners.

Putin is using all three of these elements. He is using the Motherland as the force behind him, that will hold him upright in battle. He is using judo to block, move, and use the energy of his foes. He remains disciplined to his cause while apparently allowing his foe to walk into, no run into, his trap.

Why did Putin move into Crimea, and then support (with deniability) Eastern Ukraine separatists? What purpose does a "frozen conflict", as some call it, serve? Well, it's simply a means to an end. On the one hand it's defensive as the US took over influence of Ukraine, on Russia's border. On the other hand it's reason to invite economic conflict with the US. Putin had to know the US would not go to physical war with Russia over Ukraine - especially the quasi occupation of just a part of Ukraine. So the natural deduction would be financial sanctions to try and remove Russia from the US's new ally's territory. The territory of Ukraine being it's only real strategic value. However, its real value to Putin is to not let the US and to a lesser extent Europe escape from a financial battle.

When Obama rushed in to "make Russia pay" for its actions in Ukraine, Putin must have been smiling. Every sanction the US placed against Russia was matched by Western Europe. Western Europe is dependent on Russia for economic survival. The US can't replace the European loss of market in Russia, so anything other than a very short sanction period means severe financial harm for Europe - especially Germany. As Europe slides into recession and worst, Russia can now sit by and watch as Europeans blame US sanctions for destroying their markets. While the US projects strength in Europe with sanctions and military posturing, Europeans suffer the effects. Not dissimilar to the US of Europe as battlegrounds of past wars.

With every new economic sanction waged against Russia, Putin can turn to his own people and make the case that "Western partners" are too unstable and immature to have trading relations with. All the more need for an Eurasian alliance of like-minded, stable countries who want peace and brotherly love. The more the US pushes the faster it loses. Like quick sand.

Today Putin announced that Russia has $500 billion in foreign currency. Enough, according to him, to defend the ruble for two years. However, this is the intelligence officer's half truth. While it may be true that the reserves will defend the ruble, is the purpose to defend the ruble, or is the purpose to use up the foreign currency before Russia and China switch to a gold based currency standard, thus making the US dollar irrelevant as the world reserve currency. I suggest they're using up what they have while it still has a value to them. It gives them 2 years, as Putin partially said, to transform their monetary systems to gold based. After that, they don't care.

Lastly, the US and Saudi flooding of the oil market is also working for Putin and China. China gets to stock its strategic oil reserves on the cheap. Saudi and other major oil producers are losing massive revenue that they can't replace, and they are not meant to transition into the new Eurasian/BRIC alliance - meaning they won't have anywhere of significance to sell their oil in 2 years, and will be infighting with the US and other partners for market share. Meanwhile, in the Eurasian/BRIC alliance Russia, Iran and Venezuela will be selling their oil to China, South America and Africa in a stable market which has no competitors, and controls three quarters of the world's population.

So, the best way to view the events of today is to remember that the intelligence officer's mantra is "kill at least two birds with one stone". Cheap oil hurts Russia in the interim, but it solidifies the need for a stable market place in people's minds. Russian peoples minds. Chinese peoples minds. Etc. Where is the stable market? Well obviously not the US as they "ride like cowboys into the China shop", or US allies that let them. As the US proverbially throws a punch at it, Russia proverbially uses that energy to reach its final goal. For the rest of us, it means be prepared to be the collateral damage. Protect yourself, and your investments as best you can, because when big powers fight the little guy is not on the radar.  

Monday, December 8, 2014

In NL the Budget Man Cometh

Danny Williams ' big spin was Newfoundland and Labrador would become Master of its own house. Remember that? He created Nalcor for that purpose. His government acted as if this was somehow possible. It wasn't then, and it isn't now.

There is no better modern example of how every economy in the world is dependent on each other than the world-wide economic war happening right now. It's a war the US thinks it's winning, yet it's a war the US has already lost. Hand-in-hand with Saudi Arabia, the US is flooding the market with oil to devastate economies that depend on its revenue. Russia just happens to be the number one oil producer in the world. The aim is of course to drain Russia, Iran and Venezuela of budget revenue, and ultimately ruin the new Eurasian/BRIC alliance while in its infancy.

The problem with the strategy is the intended victims, Russia and China, have historically proven they can withstand any adversity. The 25 million Russians killed while bleeding the German army white during WW II is one example. Ditto for Napoleon. Etc. The Chinese sent 250 million people back to their villages without jobs or income after the last big world economic collapse in 2008. Not even a bead of sweat creased their brow. These are tough populations, used to adversity, and determined. Our side not so much. In a game of mutually assured economic destruction, as is being played out now world-wide, the only sure bet is the populations of Europe and North America are far less willing or able to withstand economic hardship than our fellow human beings on the other side.

Where its all leading for oil is fairly predictable. Putin hinted as much when he recently commented that ISIS was surviving by selling oil on the international black market for $30 a barrel. I take that comment, in the context it was made, as a direct challenge to the Western powers attempting to empty his coffers: "Russia is prepared to see oil fall as low as $30 a barrel in an international game of chicken". Let's say that's true,  what are the ramifications of that strategy for us?

Oil accounts for 33% of all revenue in our provincial budget each year. We are now fully dependent on oil revenue for our standard of living - government and the population. We have borrowed. We are in debt to our eyeballs. An oil  recession in this province would be far more dangerous here than most places. The government has spent every cent of oil revenue in the last 9 years, except the $2 billion or so that is needed for the Muskrat Falls down payment required by the federal loan guarantee. They borrowed a billion dollars last year on top of that to pay bills. This year the deficit looks to be about $600 million or so. That will have to be borrowed as well. That means our gross debt, the money we actually owe, is almost $1.5 billion higher than when Williams was elected , and the oil money started coming in.

But what will it mean going forward? If oil settles at $60 a barrel, as many economists are predicting, our annual budget will lose about $1.25 billion. That is catastrophic for the provincial economy. That is recession. The reason is that this province relies heavily on government spending to drive the economy. Some examples are Muskrat Falls, hospitals, etc. Without that expenditure, the private companies that relied on it die on the vine. Have no illusion, they will die on the vine. That means much higher unemployment numbers, serious drops in real estate values, and all that spirals from that as usual.

It means massive cuts in government spending on programs and people. It means recession. Now, if Russia carries out its implied intention to ride the oil wave down to $30 a barrel, the consequences are much different. A $30 per barrel drop means Newfoundland and Labrador loses over $2 billion in oil revenue per year. That means depression. That means default on large loans - like the federal loan guarantee on Muskrat Falls. That means Hebron is cancelled. It means an end to all oil exploration, and the end for the many local companies living off servicing the oil industry. It means massive unemployment in the private sector and the public sector. At least in the range of 25%.

Now, you might think this is an exaggeration, but remember that the provincial GDP increases of the last decade have been almost solely based on oil revenue. The economy and society have inflated along with the boom. Personal debt has increased with the expressed idea that oil would keep going up. Government debt ditto. Therefore, the dramatic shock of oil deflation has even more severe consequences than would normally be expected. If you want a really good example, look to the oil bust in Alberta in the 1980's. That was Alberta's first big bust. They were like us. They spent like it would never end. It ended, and when it did people walked away from their houses... Alberta was devastated, and it had a government savings account - the Heritage Fund. We don't have one of those.

At $30 a barrel the refinery at Come-by-Chance is almost certain to close. Ditto for the Hebron development. Those two projects alone would have a massive financial effect in central Newfoundland. Muskrat Falls also comes into focus. Selling power at a loss for the sake of it may be trumped by common financial sense, and that project may be abandoned. As bad as its financial are now, financial arrangements still have not been made with the Nunatukavut or Nunatsiavut governments, which can be expected to be at least $1 billion extra. Then there is the prospect of Hydro-Quebec winning its lawsuit over the water management agreement. That one you can take to the bank. In 2010, the provincial department of Natural Resources estimated such a loss in court would result in billions of dollars in damages being awarded by the courts. It also stated that CF(L)Co would be bankrupted. These are the facts.

There is no bright side to the economic war being waged by the big powers in the world. Not even for them. It's the kind of "battle to the last man" that by necessity means no one else survives. We are and will remain casualties of the "greater good". We are also casualties of a foolish and irresponsible spending policy of the Williams' regime. We are also casualties of our own acquiescence to the Williams' vision.  The problem, and it's a very serious problem, is Newfoundlanders and Labradorians are not being informed of the reasons for it all. It's put down to "lower oil prices" and that's about the extent of the explanation by government. They say only two things are certain: death; and taxes. Add a third: ignorance is no excuse.  

Wednesday, November 26, 2014

The Death of the PC Empire in Newfoundland and Labrador

Seven by-elections later, without success, the ruling Tories in Newfoundland and Labrador resemble the old Iraq war slogan "shock and awe". Last night it was clearly visible on the faces of the defeated candidates and the cabinet ministers that campaigned on their behalf. It's not that they don't understand what's happening to them, it's just that they don't understand what happened to them.

For the PCs all roads lead to Muskrat Falls. After previously sacred Danny Williams got his Muskrat Falls deal he resigned - mere weeks later. That shattered the "God" image so carefully crafted. The population was left unstable as if it had lost its father, and its foundation had been shaken. Such is the danger of iron man rule - all men are mortal.

Then there was the viscous battle on the airwaves and in the social media over the wisdom and value of the project. The PCs hired expensive communication firms, and stalled requests for information on the project. When that strategy appeared to crack the Tories turned to their normal practice: legislation. They created Bill 29 to amend the Access to Information Act.  Typically that would be shuffled off as no big deal. It's not as if the public are filing access requests. However, the press, smelling a rat, went ballistic. Muskrat Falls opponents and the opposition parties grabbed onto the issue, backed by the press, and even forced a multi-day filibuster. More importantly the image was sealed. The PCs couldn't sell the bill as just normal legislation, and the public began seeing it as an act to cover-up Muskrat Falls dealings. That was when the trust was violated.

Thereafter the PCs, generally speaking, lost public trust in their word, but not necessarily in the project. Newly appointed leader Dunderdale and her team, which included Williams' brother, decided to attack the Muskrat Falls opponents rather than address the core public trust issue. She termed opponents as "nay-sayers, known critics of the government" etc... Her arrogance, and that of her colleagues, was so palpable the public became repulsed. When the PUB refused to give the project an unfettered endorsement, the PCs went crazy with indignation - including Williams who derided not just opponents, but also the PUB. It was war in a way. The problem for the PCs was their guns were focused in the wrong direction. As distrust grew, the people began taking opponents accusations seriously, and so an attack on the assertions of proponents began to be an attack on the people themselves.

It always was, and remained a battle for hearts and minds. The PCs refusal to alter their strategy of arrogantly attacking those opposed to their vision, and instead addressing the core issue of trust, resulted in a solidification of the view that "the PCs were out of touch". A natural result when a government can't see the core issue and instead shoots the messenger. So great was the vitriol that Dunderdale became almost detested by the public. The PC caucus decided their poll numbers were bad enough to fire Dunderdale, and they did just that. However, by this time, the public considered them, rightly so, as all infected by the same affliction - arrogance.

As if to emphasize the point the PCs, led on the outskirts by Williams, attacked leadership candidate Bill Barry (a reformist-type candidate) and coronated a pro-Muskrat Falls businessman - Frank Coleman. At one time an endorsement by Williams would have guaranteed a candidate acceptance among the public, but this time it back fired. The endorsement hung around Coleman's head like a guillotine, and in the end the blade came down. Coleman's company, HVP, was quietly released from a money losing government contract in Labrador, and the $18 million dollar performance bonds that were meant to guarantee it. After months of agony, and accusations "Danny's Man" was simply implementing "Danny's Will", Coleman resigned before he was even sworn in.

That led to another leadership race, after the first one was quietly swept under the carpet like it never happened, and Paul Davis was anointed the new PC leader. Davis immediately came under scrutiny for political ties to his old employer, the RNC provincial police. At the core of the issue were campaign donations that were banned by the RNC Act. (to this day the 2013 Political Contribution List has not been released publicly - although it has been ready for 7 months I'm aware of). Furthermore, an apparent political deal reached between himself and perennial political opportunist Steve Kent still hung in the air as Kent was appointed Deputy Premier. The public smelled the same-old Tory contempt for democracy that had its roots in the Muskrat Falls battles, and Davis was labelled. Then came consummation of another apparent political deal when Senator Manning's (a Davis leadership supporter)  niece was appointed to cabinet as an unelected Justice Minister.

Every action has a reaction. Every move the PCs made over the last four years did the exact opposite of what they intended. They reinforced the perception created by the Muskrat Falls battles that secrecy and power were the poison of choice for the PCs. They never adjusted from having a front man that could sell ice to Eskimos. They never saw the effect of the 5th column that battled them at every turn over Muskrat Falls. They never realized that the core issues with Muskrat Falls would stick and become the core issues against the government. There are none so blind as those that refuse to see. So it went with the PCs. All their roads led to Muskrat Falls.

Wednesday, November 12, 2014

Liberal-ly speaking

I've been wanting to write this post for along time. How to say it? When to say it? The time seems right now. In 2011 I left the PC party as the government it represents was so corrupt I could no longer bare associating myself with it. Others will say it was poor sportsmanship. Some have suggested political opportunism, as if leaving a Party at 75% in the polls for a Party at 14% in the polls was opportunism. No, the real reason was as stated - principle. Then the poor old Liberals looked like a rag tag band of warriors at best. Fighting the good fight, but hopelessly outgunned by a PC machine flooded with corporate donations, and generally ridiculed by the provincial media. That was then and this is now.

Three years later, and five leaders later, the PC Party twists in its death throws as it desperately avoids the fate of all tyrants. Now, the Liberals are the top guns and the media ridicules the PC's. So is the circle of life I suppose. But, what does the Liberal Party hold for the citizens of Newfoundland and Labrador when the inevitable election day comes next year?

My father was a life-long Liberal - to be sure. He campaigned to Liberal prime minister Louis St. Laurent for a unique Canadian flag. He submitted his own design for the same under Liberal Lester Pearson. He loved Pierre Trudeau. My family was a truly Liberal family. However, I've often wondered what he would make of the "modern" Liberals.

Gone are the days of the "Just Society", or important constitutional matters and nationhood. Gone is the focus on individual rights and freedoms. Missing in action is Canada as the friendly broker between combatants. Hopelessly ignored are the right of the Aboriginal peoples. All these things that once defined being Liberal have been discarded for "being a better Tory than the Tories". There is no word of a just society, or respect of the individual. There is primarily one focus - out doing the Tories as "managers of government". ie: who can spend the least. In an onslaught of extreme right wing ideology, the Liberal Party is now suffering an identity crisis. It is no longer what makes the Party Liberal. It's now about what makes the Party not Conservative. It has allowed its own identity to be dictated by its foe.

The provincial Liberal Party appears to be no different. Three years since 2011, and three leaders later, the Liberal Party's identity here is hardly distinguishable from that of the ruling PCs. Gone are the days of just three years ago when the Liberals stood in their place to fight Muskrat Falls tooth an nail. Gone is the determination to stop the project, and protect the average person from the impending financial assault the project necessarily would bring. Now it is simply a matter of managing the assault apparently. Barely visible among the Liberal candidates are the determined group that fought so hard to bring real change for the people. Real change being a definitive change to the corrupt political culture in the province, and the resulting responsible government that would bring. Instead, we have Nalcor bred candidates like Cathy Bennett (who has been promoted to Finance critic), and Grand Falls-Windsor Mayor Al Hawkins who the Tories appointed to Nalcor's Board only a short while ago. We have perennial establishment hangers on like Siobhan Coady ( big promoter of Alderon), formerly rabid PC and anti-Liberal Paul Lane, and so on and so on.

Instead of being the Party to transform Newfoundland and Labrador, the Liberal Party is looking much like the one it aims to replace. That may seem unduly harsh, and it may in fact be too harsh as the days are early, but the signs are not promising. It reminds me of the last election when, as a Liberal candidate, I found myself face to face with a salt of the earth man in the lower ends of Random Island. His main question to me: "Are you blue or red?". At the time I remember thinking surely their must be more on this man's mind than what colour my party is. Surely he must be concerned about the difference beyond the colour of our flags, but he wasn't. Perhaps therein was a pearl of wisdom.

With a now closing window before the next election, and by-election win tallies replacing serious vision, the question is are the Liberals to be any different than the Conservatives? Is it to be "Liberal Tory, same old story?" I don't know is the honest answer. My heart says no, but my brain is leaning yes. And, that really angers me. At a time in our history when we need a principled and visionary approach, the same old "pragmatism" appears to be reinventing itself. Where are the declarations on democratic reform by the Liberal Party? Where is the policy to eliminate the practice of corporate and union political donations that corrupt our democratic process? Where is the policy to determine how to halt Muskrat Falls until all the legalities are dealt with, not the least of which include: the Water Management Agreement; the Hydro-Quebec lawsuit; the Nunatsiavut lawsuits; and the Nunatukavut lawsuit. Where is the very real question of provincial debt and structural deficits? Where is the duty to our fishers. Where is a coherent, and humane approach to the fastest aging population in the western world - ours?

It's the silence that disturbs me. The silence and the familiarity of the actors entering the stage. Not many would expect the provincial Liberal Party to be "Trudeauesque". The federal Party isn't managing that yet. However, their should by now be a very clear vision toward the critical issues. The prevailing thought should not be: "silence is golden". The prevailing visual should not be a party consumed with winning, but rather a Party confident in winning based on its vision and principles - not on winning by default. Not winning, because we are not them. Not winning simply to replace one set of actors with another. The greatest betrayal of all is the Party that purports to be change, but simply carries on in the same manner - ie: Obama.

My hope and prayer is the Liberal Party defines itself, and commits itself, to being the agent of change that fundamentally improves the lives of its people - both politically and economically. Perhaps it is just that - a hope and a prayer.

Wednesday, October 29, 2014

Sliding toward Deflation

Think of the world as an engine designed and built to run in a certain way, and at a certain speed. The fuel of the engine is growth.  The chemistry of the fuel is debt. Then imagine one half of the world (the developed countries) running at full speed for 60 years, while the other half of the world (Asia, Africa, and South America) idling. Because our half of the world has been running full speed, we have used the most debt to power our engines, and the world economy has built itself around that fact. Now imagine that so much debt has been used to fuel the engine that it is almost depleted. Meanwhile the other half of the world is just warming up its engine and has plenty of potential debt to consume. What is the logical consequence? One falls while the other soars.

Now superimpose the unfolding China/Russia/BRIC economic order that is forming to reflect that reality. Let's call it the "New Club". Roughly designed to resemble the Soviet days of trading between countries to the exclusion of others, the New Club is rapidly building a new engine. One that attempts to capitalize on each countries strengths and satisfying each countries needs. If that sounds familiar consider Karl Marx's famous borrowed slogan " From each according to his ability, to each according to his need". Essentially, this is the new slogan of the New Club. China has the currency and the manpower. Russia has the natural resources, technology, and the know how. India has the population and science. South America has specific resources. Africa has population and need.

Together, these countries are forming a new world order. They have combined resources to create a new IMF that will compete with the old western IMF to loan money to areas like Africa and South America. They will control the debt that fires those engines. Russia, China and India (almost 50% of the world population) have entered into formal agreements to use their own currencies to pay for resources from each other. They are excluding the US dollar from their market place as an economic foundation. Making it obsolete. They are reaching deeply into Africa in fierce competition with the US to develop that continent as a place to do business. They are quickly becoming the savior for many South American countries who have tapped out their debt in the Old Club and need a rescue line.

Of course, when one grows the other dies, and the other would be the western world, or the "Old Club". Our ability to consume and pay debt has over reached its maximum. That is reflected in the over valued prices we pay for everything compared to what would be paid for the same object in the Club. In some European countries that has led to such things as inter-generational mortgages on homes. In the US it led to the "housing bubble" in 2008. The price we pay for fuel, compared to the actual price per barrel on the international market, is a good indicator of how skewed the economic reality is. While world oil prices plummet, prices at the pump don't. They stay artificially high. The same can be said for the stock markets. They are valued at more than their 2008 pre-crash worth, despite the indebtedness/under-performance of the corporations listed on them. In other words, there is a space between where they should be at in pure economic terms, and where they exist today. An artificial bubble. An artificial economy. Prices inflated to try and maintain our way of life, our government coffers, and our debt.

While there was only one game in town, that game of artificial economy could be maintained to one degree or another. There would be cyclical recessions to try and balance debt vs income vs prices from time to time, but the system could carry on. But, more dollars printed to maintain that growth created inflation in prices.Our system continued to grow fed on inflation rather than real economic wealth. We created a society based on the artificial. Now we are facing a New Club that, for the most part, will not. As the two realities start to compete the Old Club will lose market share for its products, and a glut will create deflation. 

As sales slide, and corporations within the Old Club try to adjust their production downward, each country's GDP begins to shrink - in other words deflate. That leads to serious consequences for an economic order built on growth fueled by debt. A good current example of this is Germany's recent slide. Germany is the economic engine of Europe, and as its GDP continues to fall so do the hopes of the rest of the continent. Another good example is long term bond costs. Muskrat Falls financing was secured for 50 years at less then 3% interest. Indicative that the banks understand what is coming. What else can explain that length of commitment for such a small return on investment. Perhaps one of the most clear examples of things to come is the Brazilian company Rio Tinto. While North American iron ore mines close, scale back or simply don't develop, Rio Tinto is increasing production by 25%. All these corporations compete on the international market, yet they have two starkly different approaches. Perhaps the key to understanding  this is one corporation is in a BRIC country, and a strong m,ember of the new club, while the others are stuck in the old. 

There are signs all around us if we choose to really see them. The world is changing - for the better for some, and the opposite for others. Reality, or deflation as a measure of it, is coming sooner rather than later. There is really no way for governments to prepare for it financially. Instead, and perhaps a very real indication of intent, police forces through out the western world have been armed like military organizations. Like the banks, our governments see the inevitable deflation of our economies, and understand the social chaos that must follow. At that point order will take precedence over rights. It will be a new world for the Old Club.   


Sunday, October 26, 2014

Lest We Forget

Lest we forget. That is the motto of the last two world wars. The question could be : "Lest we forget what?" Is it the men and women who died, were wounded and forever scarred by war that we are meant not to forget? Not likely, in the sense that we never knew them. Some of us had loved ones in the war, in my case a father, but I would never forget him in any case. Is it the mass destruction, the slaughter of civilians, the absolute firepower that these armies unleashed that we are meant to forget? I would argue it's all of these things, summed up in one word - sacrifice.

But, what was that sacrifice for? In different countries there were as many different reasons. For the Russians it was the "Great Patriotic War". For the British Empire it was "Empire War", and for the Americans it was the "Mess with us and die War". In the sixty odd years since the last world war we commonly see that struggle as the "War for Freedom". Freedom meaning our society would never become a police state as was the case with Nazi Germany. Personal freedom, democracy, and the rule of law would guide our nation. We prided ourselves on this, and the average person on the streets never questions it should be any other way.

Then, in a murderous, chaotic moment at the National War Monument, and then Parliament Hill, all that came into question. Or did it? As a young Corporal lay dying near the tomb of the Unknown Soldier, and as the young attacker who caused his death died in a hail of bullets in the Hall of Honour, national media were already saying "This changes Canada forever". If that sounds familiar it's likely your mind wondering back to the events of "911" and the rhetoric that came afterward from the politicians: the world is changed; America has changed; the Patriot Act; Guantanamo; wars in Iraq and Afghanistan; making the world safe for democracy; you are with us or against us. Yes, the ghosts of 911 immediately sprang to life in the Canadian national media.

But, is that really true? Perhaps I missed it? At what point did the Canadian people agree to abandon their freedom for "security"? Did we agree to forfeit our freedom that was guaranteed by the deaths of over 100,000 Canadians in two world wars over the deaths of two soldiers at the hands of two now dead ISIS sympathizers? Is our freedom, our way of life really that weak? Are we that insecure? Are we prepared to capitulate and surrender the gift of freedom, earned by the blood of our ancestors on foreign battle fields, so that we may know what it is to not live in a police state?

After the attack in Ottawa by a lone gunman the military was ordered not to wear their uniforms anywhere in the country while off base. Then, a day later, the decision was overturned. It was an immediate surrender of pride, freedom, and honour by politicians in a panic. An over reaction. What the might of Nazi Germany could not do, one lone gunman achieved - if only briefly. The national media, particularly the state-owned CBC, immediately began the call for restricting our freedom to our Parliament and greater state intrusions into our personal lives. All in the name of security. All in the name of the "greater good". Just like 911. Hopefully, that will face the same fate as the order not to wear uniforms.

The bigger lesson in all of this is just how ready "the powers to be" are to sacrifice our rights in the name of security. It was almost like they were looking for an excuse to do that, and once presented, they quickly grasped it. However, they ignore one very crucial thing. The blood of 100,000 dead earned us the right to keep that freedom. The hundreds of thousands of men and women wounded and altered by their war experience for life earned us that right. Rights that are guaranteed by our Constitution now. Freedom that is not subject to political whims or expediency. Freedom that is eternal as the flame that burns on Parliament Hill. It is paid for in full. It makes us who we are. Without it we are nothing.

The lesson for people like ISIS is that Canada can be rocked by the death of two soldiers at home. That the collective Canadian psyche is so weak that a lone gunman can bring it down by one moment of madness. Far from deterring another attack by the likes of ISIS, Canada's response must be mightily encouraging to them. Therein lies the danger. We are showing weakness. After all, ISIS doesn't care about our societal values. It cares about our personal values. It cares that we insist on freedom and equality for women, as an example. There are many others. The point is, they want to change us more than change our government. If we allow this attack to in any way alter us then they have won. When we should be giving a Churchill-like "some chicken, some neck", we instead give a Chamberlain-like "peace in our time".

Appeasing, even rewarding people like ISIS with the degradation of our freedom speaks more about us than them. It says we are weak, scared, and without courage of conviction. It says we do not find strength in the fields of Canadian crosses oversees, but rather we scurry to whatever system that will allow us to freely shop at Walmart. It says our society, and our belief system, is based on convenience rather than principle. Perhaps people like ISIS already suspect this about us. Perhaps it's even true. But, it doesn't have to be. We don't have to stand on a cold highway, and awkwardly (even bizarrely)  sing O Canada and clap as if we were at a hockey game as a lone hearse carries a dead soldier to a funeral home. Perhaps we could stand in steely silence, honour the man's sacrifice, and swear to ourselves and him that we won't trade off the freedom given by the men and women whose monument he had guarded. That would be the ultimate statement. The strength of our character and values was tested in two world wars. We prevailed. That mantle was given to us. Lest we forget.

Saturday, October 11, 2014

Newfoundland and Labrador's Revolution

This piece is my opinion, but may be shared by many.

It's been four and a half years since I returned to my ancestral home in Newfoundland and Labrador. A stranger in a strange land to be sure. The haunting, almost pre-historic beauty of the land and sea spoke directly to my soul: "this is where you're meant to be-this is home". However, as I was to find out, not all was well in Newfoundland and Labrador.

Awash in oil revenue, the likes of which it had never seen, and led by a "messiah"-like figure in Danny Williams, the Province was in  full blown party mode. Drunk on promises of never ending fortune and neo-nationalist calls by Williams to be "Masters in our own House" people were unwilling or unable to see, or didn't want to hear, that Williams was leading them into financial ruin. For those that don't know, this place has always looked to a "strong man" for leadership - likely dating to its Irish roots. Williams fit the bill. Local son done well, with gold in his pocket and a silver tongue firmly placed in cheek. "Danny" could do no wrong.

Williams cherished the role. Known for having an ego a mile wide and a mile long, Williams stoked the people's passion for a better place. A place where they were in absolute control of their destiny. The oil revenues that never existed before 2003 became 33% of a provincial budget suddenly and massively expanded. The economy roared to life and Newfoundlanders and Labradorians jumped on for the ride. New homes sprang up like grass in the spring. Every imaginable man-toy you can imagine popped up in every yard and driveway through the land. Businesses became enriched by government and personal debt-driven spending, and as long as that money kept coming from the provincial government the party would go on.

Unfortunately, Newfoundland and Labrador had never experienced a boom, and therefore never experienced a bust. It's the inevitable result of a resource dependent economy that exports to far away lands. Like any business, the far away lands are the customers, and when things go bad for the customers things also go bad for the suppliers - us. That was already happening back in 2010 when I first came home. China and Russia were pushing for a new world currency at the Davos International Forum on economy. They were already engaged in a financial, low-grade economic war with the US. Along with them were the BRIC countries - most notably India, Iran and Brazil. Also back in 2010 the US was massively expanding fracking to release natural gas and oil reserves which would put them in a position of energy independence. All these major, and very obvious foreign forces were already at play then, the result of which is starting to be seriously felt now. Yet, nobody in the government of Newfoundland and Labrador twigged on?

Despite all the external factors, Williams continued to sell people that somehow this Province could be "Masters of our own House". He knew better. In the world of global economies, no country is a master of itself. Not the United States, not Europe, not Asia - nobody. Williams knew this all too well being a businessman with international holdings. Yet, like the Pied Piper of Newfoundland, he led the people in a trance down a very murky road. One that was to his liking and his benefit.

He bragged of the investments in healthcare, but chose to have his heart-saving surgery done in the US. He railed against giveaways of provincial resources, but happily bought Crown Land (enough to build a small city) at a well under man-dated price of just over $300 an acre. He sold his offshore oil service companies to Quebec firm SNC Lavalin while they did work for the government on the Lower Churchill development - despite chastising the previous Liberal government for conflicts of interest. He appointed his former employees, supporters and friends to places throughout the hierarchy of the government, despite lambasting the Liberals for doing the same. In short, Williams behaved as Premier as if the rules of modern politics and economy did not apply to him. Unfortunately, it was ours, not his, money and destiny at stake. That was apparently lost on him.

And if you dared to stand up against him, well, there was a special place in hell for you. The best way I can describe this treatment for dissenters of Williams' will are the words now Finance Minister Ross Wiseman's Executive Assistant, Chick Cholock, leveled at me, in my home, and in front of my wife, with the kids playing upstairs. I had announced that I was considering running for the leadership of the Party, suddenly available after Williams' quick exit. The words were this:

" If you try and run for the leadership we will destroy you. We will destroy you financially. We will destroy you personally. We will destroy your name."

Then, just as he left my home, he turned at the door, and said:

" I am with the backroom, and we hope you make the right decision."

It's a personal story for me, but it's useful. In the Williams' era to dissent or deviate from the "backroom" was to invite ruin upon yourself any your family. Newfoundlanders of course already knew this. The idea that opposing meant losing everything did not appeal to many. In the nut shell, this was how Williams enforced his will. Reward is great, but so is punishment.

Four years later things have changed. The people are changing. Their expectations are changing. They are seeking answers to the questions that are now becoming obvious to them. Why are the roads still so bad after $16 billion in oil revenue has come into the coffers? Why are people still leaving? Why are the much vaulted iron ore projects in Labrador evaporating? Why are civil service jobs being cut? Is Muskrat Falls really the project we've been sold? What will happen to us as oil prices continue to fall? Why can't I sell my home?

Williams and, most recently new premier Paul Davis, continue to try and suppress dissent by filing lawsuits like confetti at dissenters. A desperate bid to keep control in a place spinning out of their control. Dissent is now loud. Dissent is unstoppable. Not just for the government in place now, but for the one to come next year. The political culture in Newfoundland and Labrador has under gone a massive and sudden change brought about by a sense of betrayal. A realization that somehow the all knowing Williams has lead them afar. Reality is crushing fantasy, and people are beginning to realize the cost to them personally may well be enormous. A moment in history, of a place 500 years old, has been squandered. That one of their own, a man they trusted and revered, may have betrayed them. Danny Williams often referred to people who refused to see the value of his actions as "traitors". Now, the same words may well be used against him. Such is the Newfoundland and Labrador revolution well under way.  

Wednesday, August 27, 2014

The Ukraine Rope a Dope

The situation is turning from bad to worse in Ukraine for that country's government. Its policy of flashy pincer movements to try and capture high profile objectives for media consumption has come to its natural conclusion - utter failure. As I wrote one month ago - The Mouse Trap - NAF forces were sucking the Ukraine army east to lure them into battle within the strategically convenient, and plausibly deniable, Russian guns. Since that time Ukraine has lost most of its operational air force to missiles, and has seen entire brigades of men wiped out along salients located near the Russian border.

Rather than recognize what should have been the obvious, the Ukraine government continued with the policy of "not giving one inch" and remained in place, trying all the time to crush the will to defend by massive artillery strikes on cities. However, just like Hitler did to his Generals, notably the 6th in Stalingrad, the Ukraine government refused to give ground to a more favorable position. The result of that somewhat reckless decision is now the same result Hitler found - encircled forces. At the time of this post there are 9 encircled formations of Ukraine troops with an estimated total strength of 20,000. For an army the size of Ukraine's, this number represents a decisive loss. What makes matters worse is the knowledge that the units now trapped, and the ones trapped prior to this and already eliminated, represent the entire core of Ukraine's professional army.

The situation in north and central Luhansk is essentially a standoff, with neither side making any bold moves at this point. It has become a static front. The same applies to the west of Donetsk city. Ukraine continues to try and make fruitless attempts to cut off Gorlovka, north of Donetsk, from the rear. The result has been mixed, and has resulted in high casualties with no tangible reward. It is to the south of both Donetsk and Luhansk oblasts (provinces), lined by the Russian border, where Ukraine has suffered the most dramatic and catastrophic losses - in men and position. It began with several Ukraine brigades being trapped in the "South Pocket" along the Russian border, and ended with approximately 1500 soldiers being released back to Ukraine with 10,000 missing. It also resulted in the capture of large amounts of Ukraine tanks, and more importantly artillery. With the essential destruction of the Ukraine air force, artillery on both sides has become the tool for battlefield dominance.

That brings us to today, and tomorrow. Having tied up a large percentage of Ukraine troops at the north and central fronts, and with Ukraine thus far refusing to withdraw to positions more defensible with fewer troops, the NAF has moved in the South. Essentially, the move came from near the Russian border two days ago, including an amphibious landing just east of Mariupol on Ukraine's south coast. Simultaneously, NAF units in Donetsk city counterattacked toward the South. The resulting squeeze caused a large Ukraine retreat, but not before two more large pockets of trapped troops were created. At the time of this post Mariupol is surrounded on two sides, with the western resupply/escape route being rapidly closed. NAF units are fanning along the north of Mariupol in an attempt to block Ukraine units from moving south to intercept advancing NAF forces. The goal appears to be the City of Melitopol. From there the NAF have quick access to the Crimean border (Russia) and the Dnieper River cities to the north.

I call this the "Left Hook". Basically a very large flanking maneuver. Having sustained all the blows the Ukraine army could throw at it, the NAF is now countering an exhausted foe - hence the title "Rope a Dope". With Ukraine's entire rear exposed, including all the way to the capital Kiev, it will have no choice but to rapidly withdraw West, and re-position forces to its southern rear. That opens the door for the NAF to easily move West, and that is where the next move comes - the "right uppercut" if you will. The NAF will then be in position to move on Kharkiv city, and the oblast in general - in the North. It will be free to advance in the centre and bypass (if still heavily defended) or capture Slavyansk and area moving directly to the City of Dnepropetrovsk on the Dnieper River - which is to become the new westerly border of a new Novorossyia (New Russia).

The last front to be explained is the Kherson/Odessa areas. Once the NAF capture and secure Melitopol, the Ukraine defences along the Crimea border are exposed from the rear. At that time the separatist region of Moldova, Transnistria, which houses Russian and "Transnistria Self-Defence Forces", is likely to strike southward toward Odessa.

All these moves combined mean a few things. Firstly, it appears that although there are peace or cease fire talks ongoing, they are likely for show at best. Secondly it means that Ukraine will cease to function as a country. Its already desperate financial position will be crippled by the loss of one half of the country - the most resource rich part. Thirdly it means that Ukraine will become landlocked and essentially a new "pocket - like" area. If NATO were to move into this area, they would be surrounded on three sides by Russia, Novorossyia, and Belarus. It would be indefensible. Therefore, Ukraine, or what's left of it, turns into an economically barren no mans land between East and West.

In any case, the "Mouse Trap" is done, the "Rope a Dope" is done, and now it's time for the "Left-Right" combination punches. I understand Putin is a judo champ, and he may have a judo analogy for this, but for now this is mine.

Saturday, August 9, 2014

The Ukrainian Genocide.

This woman's eyes have haunted me since 4:00 p.m. Ukraine time, June 2, 2014. Her name was Inna Kukuruza. She was a wife, a mother, and a citizen of Luhansk city. On that day, June 2, 2014, she made a fatal mistake walking past the City's Administration building after work. She, and many others, had her life ended in a hail of unguided rockets fired by a lone Ukraine air force jet. However, unlike the rest of those dead around her, she did not die immediately. She lay there for seconds, all filmed by the ever present phone cameras, and asked to speak with her daughter. Then she died. What the picture above doesn't show is her mangled legs, or her missing foot. She bled to death. My heart broke for her at that moment.

It was just the beginning of a campaign by the Ukraine military, and its paramilitary forces known as "National Guards", of killing civilians throughout the Ukraine provinces (known as Oblasts) of Donetsk and Luhansk. A slaughter that Europe has not seen since the civil war in the former Yugoslavia. Yet, through all the fog of war, a clear pattern has emerged. The Ukraine army approaches a "rebel" (NAF) area, normally a community. They establish fire bases around it, with varying types of artillery, and then they start shelling. It was the same in Slavyansk, Kramatorsk, Gorlovka, Donetsk, Luhansk, and every other community in the two break away provinces.

First the infrastructure is targeted. Specifically, the electrical power stations. Once these facilities are knocked out, and no power flows: sewage systems shut down; water systems shut down;  hospitals can't operate well; commerce can't function; and on and on it goes. The clear and obvious strategy is to place the citizens of the community in misery. To turn them against the NAF in a psychological warfare conducted with artillery. Of course, the artillery and its ferocity, terrifies the people all on its own.

Second, health and transportation are targeted. Bus stations and train stations are hit. Hospitals of all types are hit. Even schools are hit. The pattern repeats itself in every community the Ukraine army assaults. There is no mistake. At this point the citizens are not just terrified, but also trapped. They can't leave the chaos. They are corralled in a hell no civilian should have to suffer.

Then, the civilians themselves are targeted. Specifically, their homes, apartments, shops, and city centres. The victims have ranged from the very elderly, and in some cases mental patients, to the youngest children and everyone in between. The shells and rockets don't have a conscience - the people that fire them are meant to.

Slavyansk became the model for all Ukraine army operations since. Surround the community. Do not allow escape. And fire. Small caliber mortar fire was the start. There were many reports of it on social media, but the "main stream media" refused to report it, or its damage. As if encouraged by that, the Ukraine army brought in larger mortars, then field artillery. They got away with all that too, despite pictures of the destruction and the civilian victims flooding social media. There was no outrage, or reporting in the main media. The NAF refused to budge, so the Ukraine army brought in even bigger guns - self-propelled 152mm guns. Monsters of artillery, these weapons created massive, indiscriminate damage and casualties. Not completely satisfied with this level of destruction, the Ukraine army started using air burst white phosphorous shells at communities on the outskirts of Slavyansk, and then Slavyansk itself. The Russian government drew the line there and raised concerns about it at the UN. It was dismissed, and the  Ukraine army carried on.

Then came the battles around Donetsk city, Gorloka and Luhansk city. A whole new form of artillery was deployed - Multiple Launch Rocket Systems (MLRS). At the low end of these systems is the GRAD, and on the high end the "Tornado", "Hurricane, and "Smerch". They can fire up to 40 high explosive rockets at a time. They were designed by the Soviets to break up tank formation and create chaos. They are lethal and can level entire complete grid squares when deployed enmasse. They are also unguided. The use of MLRS took the ferocity of the conflict to an all new level, and with it a rapidly increasing civilian death and wounded toll. Pictures of grandmothers , fathers, children, and even priests - with their bodies torn to pieces - began flooding the social media. So grotesque were the results that You Tube began taking films of the victims off their site.

As if this wasn't a great enough outrage, the Ukraine army upped the ante one more time. On July 29, 2014 the Ukraine army fired four, of a reported five available, SS-21 ballistic missiles at the NAF held community of  Snezhnoe. The missiles are massive, and carry a warhead of up to 1000 lbs. They can be used to deliver nuclear weapons. In this case they carried high explosive warheads. These were designed as, and remain, weapons of mass destruction. Even the US government admitted the missiles were fired - yet they did not cause any damage. The reason? Russian S-300, S-400 anti-missile/air units on the Russian border shot them down before they impacted Snezhnoe. If the Russians had not intervened, the loss of life would have been in the thousands. It is here that apparently the US and West were prepared to draw the line on the Ukraine army. There was no condemnation by the West, but there was also no condemnation of Russia for shooting them down.

The death toll so far in the Ukraine war against the Donbass Region (Luhansk and Donetsk) was estimated to be around 10,000. The wounded many more times that. Over 250,000 refugees have fled - mostly to temporary camps lining the Russian side of the border. Those that remain are suffering constant shelling. Constant terror. But, that's the point of it - right? The Ukraine government always refers to the NAF as "terrorists", yet the only side terrorizing its citizenship seems to be the Ukraine government itself. The Geneva Convention is supposed to protect civilians and civilian institutions at a time of war, however the lawyers in the crowd claim this isn't a war. It's war-light. It's an internal insurrection. Although the Ukraine government itself has accused Russia of invading it at the UN Security Council. It would seem, therefore, that the Ukraine government considers itself in a state of war. In that case, the rules of war as outlined in the Geneva Convention should apply to them.

If, for whatever reason, the lawyers succeed and the Ukraine government is not restrained by the Geneva Convention, then there is always the International Court of the Hague. It clearly details that attacks made against civilian populations, or terrorizing civilian populations, or forcefully moving populations is a crime against humanity. There can be no doubt in any right thinking person's mind that what Ukraine has committed against the Donbass is a crime against humanity. Inna Kukuruza was a member of humanity. She did not deserve to die in that blood soaked street in Luhansk city. There was no need. She did no wrong. Her only crime was to be a citizen of a break away region of Ukraine. As far as I'm concerned, Ukraine will never be able to whipe that spot of her blood off their hands. Her final appeal to speak to her daughter, her eyes betraying her terror, the helplessness, will never leave me.

Sunday, August 3, 2014

The World at Undeclared War

"Between the idea And the reality Between the motion And the Fact falls the shadow." 
Eliot 'The Hollow Men'

Such is the world we live in today. To even the casual observer, our world is torn by strife, hatred and malice. Wars are erupting in every corner of the globe as if some great match had lit the place on fire. Seemingly disconnected, seemingly indirect, they are erupting everywhere around us. But, is it happenstance,  or is an undeclared world war?

The one thing most people will agree on is "money turns the world". It always has and it always will. The chase for resources. The right to consume them above others. Also known as greed - one of the deadly sins. In a previous posting, I detailed the economic transformation happening to the world as this is written - The Great Uncoupling . Essentially, it described the economic uncoupling of the current "New World Order" into a bipolar economic world: North America and Western Europe vs Russia, China and the BRICs. Since that time it is coming together:

The economic realignment isn't a coincidence, but rather the culmination of decades of work by Russia and China to defeat the West economically. Apparently, they feel satisfied enough at this time to proceed formally, and they are. They have even gone so far as creating  their own IMF. India has just torpedoed a $1 trillion dollar treaty with the IMF. Argentina has just defaulted on its debt. And this was just this week. What all this amounts to is a revolution of sorts. The revolution being a complete undermining of the Western dominated financial system to a system based on Eurasian control. Included in this push, of course, is excluding the US dollar as a currency to purchase Eurasian or even BRICs supply contracts or orders. 

The next step, in such a financial war would be China exiting from its close relationship with US debt and dollars. It seems logical that once the new Eurasian financial system is on solid footing, that China would drop its US debt holdings and its massive reserve of US dollars. A final coup de gras (death blow) if you will. US economists already call the possibility of China selling off its massive holdings in US debt as the "Chinese Nuke". The consequences of such actions by the Eurasians would be catastrophic for economies in the Western world, and will lead to massive unrest. 

Some say that China would never do this, because it would be devastating for their economy as well. However, therein lies the lessons of history that people seem not to learn - even very recent ones. After the 2008 financial collapse China sent about 250 million people back to their villages around the time of the Chinese New Year - and left them there. They were instantly unemployed. There was no revolution. No chaos. Nothing. If a similar thing were to happen in the Western world, unrest would be a mild way to put it. It's all about expectations - the Chinese have few - the West has many.

That brings me back to the world in conflict today. The US and the West now knows it is in a financial war it cannot win. It risks losing the world dominance its dollar gives it, and its military defends. With the financial war gone, and unless it is willing to accept a "Brand New World Order", the only choice it has is to use its military strength - and that appears to be happening. The only problem with using direct military power is the Russians and Chinese have it to, and that would be "mutually assured destruction".  Instead, the West appears to have adopted a shadow war approach aimed at destabilizing both Russia and China. 

With China there are tensions with Japan, and some other Asian countries over the South China Sea. The US has shifted its military forces world-wide to the Asian theater . However, based on current events, it seems the West is targeting Russia first. The Western backed over throw of Ukraine's President resulted in a direct provocation to Russia - as t knew it would. Rather than react formally with an overt invasion, Putin has chosen to fight a shadow war back. He has in fact lured the primary forces of Ukraine into the east and south east of Ukraine, which allows him to: quickly resupply rebels; provide air superiority when and if necessary; provide artillery interdiction when necessary; and essentially corral the Ukraine army into an area that, if he chose, he could destroy quickly from Russia and take all of Ukraine within a week. I detailed it here The Mouse Trap. Action. Reaction.

This week tensions grew on Russia's southern border between Armenia (where Russia has a base) and Azerbaijan, resulting in open battle . Not to be out done, this week a relatively unknown group popped its head up wanting Siberian independence . Then of course there is the conflict in Transnistria. Transnistria is a separatist region of Moldova that essentially is almost an independent (albeit tiny) state now. It also has a Russian base, and strategic ammunition facility there. Among Russian commentators, most expect this area to be the next flame fanned by Western powers. In broad strokes, these conflicts around all of Russia's borders have one thing in common - they are flames being fanned by Western resources to destabilize Russia -that's my take on it. 

Then, of course, there is the "imperial" interest score card. Iraq has become essentially another proxy battleground mixing strange bed fellows with religion. The ISIS (Sunni) forces have fanned out from Northern Syria (an ally of Russia) into Iraq (a Shia ally of both Iran and Russia). Iran (an ally of Russia) has intervened to keep the Shia-dominated government of Iraq in control of the country. Saudi Arabia (a US ally) has funded the ISIS forces to first overthrow Syria and now Iraq. In fact, Saudi Arabia has even moved 30,000 troops to Iraq's border. The US could have ended this crisis quickly by providing air support to Iraq, but it refused. ISIS was then able to make large gains in Iraq. In case you weren't aware, prior to taking out Hussien, the US propped up mostly Sunni minorities to rule over Shias in the past. However, whenever "the enemy of my enemy is my friend" phase loses its place, "interests" take back over. This week the ISIS forces attacked the Kurds (also a US ally) in northern Iraq. The Kurds were quite happy with what ISIS did at first, because it allowed them to seize Mosul and other lands for a future "Kurdistan". Not so much now. 

In any case, the point is that, as is the standard operating procedure for the US and other powers, piecing together groups here and there to achieve short term goals can blow up in your face. It appears the "coalition of the willing" this time around can't be expected to last too long before the bigger powers get involved. For instance, if Iran gets more involved in Iraq, and the ISIS forces are getting defeated, it would not be surprising at all to see Saudi Arabia move those 30,000 troops into Iraq. That sets up a direct confrontation between the two on Iraqi soil - to begin with. That is a very real possibility. The US has a number of bases in Saudi and directly supplies it militarily. That could draw the US in as well. If Saudi Arabia were to begin to lose a war with Iran, US intervention is guaranteed. So as you can see, a simple invasion by a group of fanatical types (ISIS) can quite easily develop quickly into a region wide conflict of biblical proportions. 

For every action there is a reaction. So it is in science and so it is in life - which includes politics and warfare - unfortunately. The truth is that the world is already at war, but nobody seems to recognize it. Nor, does it seem, do they see the underlying causes. There is this and that about the usual "You're a nazi, we are democracy, yada yada", but in the end as in the beginning, it's simple rhetoric. The truth is far more serious. It's a war, a hot war, happening on multiple fronts before our eyes. Sure much of it lies in the shadows, not yet ready to be overt, but it's there nonetheless. People are dying, cities are being destroyed, countries and families are being ripped apart. Interests are acting. Daring each other to go to the next level. Seeing who will blink first. Seeing if anyone will blink. It appears that the days of blinking maybe over, and the ante will only rise. Until that unfortunate day happens, we will still be at world-wide war. It just remains undeclared.

Saturday, July 26, 2014

The Mouse Trap-Battle of Ukraine

It might seem like a strange headline, but the war in Ukraine really is over already. Some wars have their ending written the moment they are started - the fighting and dying being the interlude between the two. Take for example World War II. Hitler was warned by his Generals not to start the war in 1939, because Germany's rearmament was not ready and the prospect of over extension was obvious. Hitler didn't listen, and the moment German tanks crossed the Polish border the war was lost - for Germany. The case is remarkably the same here.

What started as a very obvious western coup of the then Russia friendly government of Ukraine turned into a civil war. Although it is denied, by both sides, the West and Russia have fed and lead the opposing forces in the Ukraine from the get go. However, unlike almost all other proxy wars the two have waged against each other since WWII, this time the collision between the two has become almost inevitable. It almost happened earlier in Syria when Chinese and Russian war ships steamed into the waters off its coast to challenge an immanent American-led assault. The US blinked, and the rest is history. Now the battlefield is Ukraine.

The Novorossyia forces (NAF), also known as separatists to the Ukrainians, led by Igor Stelkov (former Russia army Colonel), created what can best be described as an "elastic defence". What that means is they spread themselves out thinly around towns, villages and cities throughout the Ukraine provinces of Luhansk and Donetsk that they claim as their own. Rather than negotiate with the NAF, the newly self-appointed government of Ukraine immediately responded with military force. First with weak incursions by a handful of armored personnel carriers (APCs), which were chased by residents out of communities, and then more radical "Right Sector" (neo-nazis) and "National Guard" units.

The Ukrainians gradually took each little community or town one by one. The NAF gradually withdrew to the areas directly surrounding their two cities of Luhansk and Donetsk. On the face of it, the Ukraine army appears on the verge of victory, but things aren't always what they seem. Firstly, as the NAF slowly withdrew from their elastic defence, they took a very serious toll on the Ukraine army's equipment and troops. Estimates are in the tens of thousands of deaths and wounded. The Government of Ukraine vigorously denies it, but the decree of mandatory service last week strongly suggest the numbers are true, and Ukraine needs replacements. The NAF, of course, are also taking serious casualties, but they are in reinforced defensive positions giving them a strong advantage. The traditional figure, if the attackers do not have air superiority, which in this case Ukraine does not, is about 10-1. Given each city is rumored to have at least 10,000 fighters, the Ukrainians would need about 150-200 thousand troops to take them. They are nowhere near that.

How then does Ukraine propose to overcome this tactical problem? It seems they intend to rely on massive artillery. In particular, the use of Grad and Smerch rocket artillery. Both these weapons systems were designed to tear apart NATO tank formations by the Soviets. They fire multiple rockets in each salvo, and flatten the ground grid by grid. Ukraine has been using these rocket systems already in smaller locals, but these are large cities - 500,000 to 1,000,000 people. Herein comes the part where you lose the war once you start it.

To fight a war in a cities of this size is a massive effort. The casualties are huge. The destruction wide spread. The civilian casualties unconscionable. Take the battles in Syria's cities for example. Or Stalingrad, Leningrad, Berlin, etc. The Ukraine army is slowly, methodically being drawn into a trap of its own making. For starters, it has transferred a massive amount of its men and equipment from the West of Ukraine to the front in the East. Those forces are focused around the provinces of Donetsk and Luhansk, and being warn down. These are its best units. However, the biggest danger for Ukraine is that the vast majority of its army is now within range of Russian artillery/rocket forces without those same forces having to leave Russia. Furthermore, the Ukraine forces are effectively without any air support.

I call it the "Mouse Trap". Russian forces, having lured the Ukraine army east, with the NAF being the cheese, can now trap those forces behind the Dnieper River - unable to defend the western part of Ukraine - including Kiev. That would be the metal part of the bar coming down on the neck. A good example of this is the Donetsk pocket that formed between the Russian border and southern Donetsk province. Ukrainian forces, following ambitious orders of the new President of Ukraine Poroshenko, sent 3 of the best and largest battalions they had to close all the border points between Russia and Ukraine. These forces swept north of Maripol and continued along the Russian/Donetsk border capturing crossing after crossing - until they came up against fortified emplacements waiting for them around Torez area. Then, suddenly, way back where they started the swing, the NAF captured a relatively small position that cut the entire force off from any resupply. Without air support or resupply, units like the 79th and 72nd airmobile brigades were systematically destroyed where they were trapped. Many have died. Many have surrendered to Russia at the border. Most of their equipment is destroyed. That battle continues. Point is, they were lured in and then destroyed, helplessly.

On a much bigger scale, this is what I believe Russia is doing to Ukraine, and in a sense its western allies. The calculation is: will the West go to war with Russia over Ukraine? The obvious answer is no. Being that the answer is no, Russia has a free hand to really act at any time it chooses in Ukraine. It may allow Ukraine to wither away in a battle of bloody attrition in the cities of Donetsk and Luhansk, and then move in when its citizens can no longer stand the scenes of civilian casualties and destruction. It may choose to move sooner to save the inhabitants, and bring its people along board. One thing it certainly will not allow is a NATO presence of any kind in eastern Ukraine, and western Ukraine is also questionable. Putin still sits back, with many cards up his sleeve, with the cat like smile that has become famous. Europe entertains the thought of already deflating economies, and what a Russian withdrawl from their economies would mean - instant depression. The US has too many balls in play around the world to react, and even if they could, what can they do to the Russians that the Russians can't do back to them? Not much.

It's a game of chess. A friend once called it Wizards Chess (after the famous Harry Potter scene). I call this particular strategy the "Mouse Trap", and Ukraine is the mouse.