The Decline of Danny Williams

There was a time when Danny Williams' controlled the collective mind of Newfoundland and Labrador - those days are over. While premier he wrapped himself tightly in the provincial flag, while disgracing the Canadian flag. He put gas on the fire of Newfoundland nationalism. I say Newfoundland nationalism, because Labrador nationalism is a kettle of fish he doesn't see as fitting into the picture. For those that don't know, Labrador nationalism is to get the hell out of the province of "Newfoundland and Labrador".

He fanned the flames of already well entrenched anti-Quebec feelings in the province. Blaming Quebec for holding the province down - everything from the Upper Churchill to the Labrador border to transmission rights. Yes the province got screwed on the Upper Churchill, but was it Hydro-Quebec that did it, or a collection of European business men (Brinco) and a then premier who bought 100,000 shares in Brinco hoping to become rich (Smallwood)? Perhaps it was all the above, but Quebec saw his vitriol. Transmission rights were treated in a similar vein. Quebec approved transmission rights for the province, but insisted Newfoundland and Labrador pay for the cost to increase the lines capacities,etc. Williams wanted it for free. He turned them into the bogyman, while in reality it was simply him being too cheap to pay the additional costs. And on it goes. He was the fan of hate. The provocateur. The identifier and the answer all in one.

People generally, and widely bought into that vision. Fueled by sudden oil wealth, britches were extra large. No one ever stopped to tell the people that, despite the oil wealth, the province still only made up 1.5% of Canada's GDP. No, according to Williams and company this was Canada's newest and coolest province that was at the top of the country. In truth, Newfoundland is the oldest settlement in North America (500 years old), and despite joining Canada only 65 years ago, many of its ways follow those time lines. Sure it is cool and has a grove, but so do other places in the country as well. Simply put, Williams exaggerated to the maximum the province's good things, and trivialized the negatives. It created a false impression, and people bought into it.

Things have changed now. 11 years since the start of Williams' reign as premier, and about the same for the oil boom, people are becoming jaded - not without reason. $18 billion dollars in oil income has essentially evaporated. The civil service was increased by 25% (locally known as the "buddy boom") while the gross provincial debt actually grew a billion or so from where it was in 2003. Now the province sees massive cuts in that same civil service. Programs are being trimmed or cut everywhere. There still remains about 300 water boil alerts in rural municipalities across the province. The public roads are literally worse than most third world countries that have pavement. Taxes and prices have skyrocketed as local inflationary pressures from spending like a drunken sailor smashed against the economy. In other words, many people have felt the costs of the "oil boom", but not the benefits.

Essentially, Williams set the economy on fire by dumping billions of taxpayers dollars on building-type infrastructure. The biggest and most gruesome being Muskrat Falls. The PCs had to rein in all that "good times" spending on schools and the like to save up for the 35% down payment the feds required to grant a loan guarantee to build the dam. Now, suddenly, there were layoffs, cancelled programs, healthcare problems, education problems, road problems...the list goes on. Next will be the billion needed for the Hebron partnership that Williams insisted on. But, before that, will come the public pensions.

Williams, during the great spending spree, never took care of the non-sexy stuff like funding the pensions. The only real money he put into the pensions was the $2 billion Paul Martin advanced on the Atlantic Accord, and that was only because it was written into the deal that the money had to be used to reduce the province's debt. Now, as is the case in all our lives, the ignored bill has become the pressing bill. This year Standard and Poors threatened the province with a down grading of its credit rating, because the pension debt had grown into a monster. In fact, since Williams came into office, it has tripled. That $18 billion is all but gone, and the pension bill now approaches half that figure. The cold reality, or the "party is over" hangover, has gripped the province. People are looking around themselves at their grossly over valued housing that is not selling quite like it used to; at that property tax bill that has tripled for that over valued house; at the programs they once took for granted being scaled back; and at that pension they always knew they would need being threatened. Now they are mad. Betrayed. Disillusioned.

That is where the fall of Danny Williams comes in. Like many before him, the grand savior is now being seen in a different light. No longer is his word gospel. No longer is his position without reproach. Many still fondly remember him with the good old days, but a growing number are also associating him with the province's "missed opportunity". Why? Because he didn't do the non-sexy things. He didn't bother with the fundamental responsibility of government, to look after the welfare of its people, but rather he took care of business's business. The cloak of secrecy that he brought in to shield Nalcor, and other government operations is now under intense scrutiny. The bond of trust he had with the people is shattered.

Williams' once untouchable reputation as premier is now only too human. Two very clear examples should make this crystal clear to any casual observer. The recent by-election in which he campaigned for a week straight for his friend Danny Breen in Virginia Waters was one. This district fell to the Liberals despite being former premier Dunderdale's seat, and despite Williams' own personal week long crusade. In the recent past, Williams would only have to show up for a quickie hand shake photo op, and the candidate was guaranteed to win - sprinkled as he or she was with Danny dust. Didn't work for Breen. He lost. Williams claimed he was called in because Breen was sitting at twenty something percent, and that his involvement brought the race to within 40 votes of winning. The truth, as just stated, is Williams mere presence was not enough to save the PC seat or his friend.

Then there was Frank Coleman. The first premier-elect in Canada to be investigated by an Auditor General and resign before he was even officially sworn in. Another friend of Williams. Another friend down. Many believe, as do I, that Williams orchestrated Coleman's run for the leadership. Yet, it failed spectacularly. The entire spectacle played out on provincial and national TV. The embarrassment for the province unprecedented. Williams claimed he had nothing to do with Coleman's "coronation" as leader and "was-to-be-premiership", but almost nobody believes it anymore. The golden touch has turned into the poisoned chalice.

Then, just yesterday, Williams and Brian Tobin presented together at the NOIA conference in St. John's. Afterwards, the media interviewed them both together. The questions were put to Williams. The general theme of the questions: "Are you still going to be involved in politics and the new leadership race for the PCs?" He was quite firm in his reply: "No". He was going to just be quiet now and stay out of politics, much to the apparent relief of Tobin beside him. However, that was short lived. During the same interview he publicly attacked anyone who "publicly shit on Nalcor" - the most political of all bodies in the province.  

"There is a group out there that every day just keeps pounding away...they've all got the same background, they all come from the same origination, for want of a better term, even though it's 30 or 40 years ago. And they're out there just pounding away at us just for the sake of pounding..."

Now, apart from sounding a wee bit paranoid and disturbed, the quote illustrates a few things. It shows that Williams still would rather attack the messengers than contemplate the message. It shows that Williams is still unable to understand the basic tenants of democracy - like the freedom of speech. It shows that Williams is all about getting his own way. In other words, he hasn't learned a thing. Maybe it's hard to teach an old dog new tricks? Either way, the mesmerized audience that once followed closely and unquestioningly at his feet has woken to the reality of the betrayed.




 

Back Stabbing the People of Newfoundland and Labrador

Financial crunch, requiring deep cuts and discipline, is the state of our provincial government's finances according to our PC government. On the radio waves, on the tv, all we hear is the necessity for cuts and lay-offs, but is it true? Well, frankly no, it isn't.

Despite all the foreboding of impending doom, oil revenues for 2012, $ 2.8 billion, were the highest ever. The province recorded a whopping $883 million budget surplus for the year. Just another in a line of offshore oil fuelled surpluses. It is strangely odd then that the province would lay-off 1200 employees, affecting all those families as well, and cancel numerous programs - including the West Coast Training Centre today. The mantra is austerity. The tool is responsible care taking of the treasury, but is that real? No, not even close.

Consider this: between 2005 and 2012 the province received $12.25 billion in offshore oil revenue - that's an average of $1.3 billion a year since 2005. Now consider this: the gross debt of the province is actually larger today than it was back in 2003, before oil income bloated the coffers. Specifically, the gross debt in 2003 when the PCs took over was $12.8 billion. Today, as of March 31, 2012, our gross debt $13.4 billion. In other words, despite bringing in over a $12 billion in oil revenue since 2003, the province is over a billion dollars further in debt. How can that be possible? It's called poor decision making.

The gross debt is made up of primarily three things: borrowings; unfunded pension liabilities; and group health and life insurance retirement benefits for public employee and politicians. In 2003 net borrowing was $6.5 billion, unfunded pension liabilities stood at $3.56 billion, and group health and life was $1.05 billion. Nine years later, and $12.25 billion richer in oil money, the same categories looked like this: unfunded pension liability $3.09 billion; and group health and life $2.09 billion.

So, if all that oil money came in over the last while where did it go? Clearly the oil profits were not used to really reduce these retirement liabilities. Back in 2003, the provincial government had a total of cash saved and invested of $441,855 million. Today, that same bank account is almost $2.5 billion ($2,442,963,000 as of March 31, 2012 to be exact).

The revenue went way up. The spending went way up. The bills of the future went unpaid, and the difference was left in the bank. It begs the question: Why the austerity program with so much money squirrelled away? There is only one answer to that: Muskrat Falls. Before you roll your eyes and say here we go, take a moment. The memorandum of understanding regarding the federal loan guarantee for Muskrat Falls requires the province to have a down payment of 35% down before it will guarantee any loans.

The province's estimate of its share of the project is about $6.5 billion. Projects this size never come in on budget, and normally have a contingency fund of 25%. Given that, the province is looking at raising at least $8.25 billion. That means the federal loan guarantee would require them to raise about $2.9 billion for their down payment. They had $2.4 billion in the bank as of March 31, 2012.

Bottom line, the province is laying people off, cancelling programs, not expending department budgets in a desperate effort to bank their down payment for Muskrat Falls. Simple as that. We are expendable in the name of a dam. Ask the people who lost their jobs, or the groups that lost their funding or their schools. Ask those desperately waiting for the construction of hospitals, or road paving, or a number of any other services. It's a real point of curiosity that the issue of the funds in the bank is not a bone of contention in our media or for our opposition groups for that matter. It seems that the knife never stops striking the people of this province in the back.