The large and thoughtful mantle of Uncle Gnarley came awake
just as I, too, was regaining consciousness. 
The bottle of Springbank, Gnarley’s favourite of ‘beneficial vapors’ had
worked its magic and gave us both a little respite from each other’s
insistent consideration of the Muskrat Falls issue. 

I had almost regretted removing the cork, in the first
place, except I knew that this particular ‘elixir’ was one which improved his
normally obnoxious demeanor. 

Knowing Gnarley, he likely felt that, with every sip, he was
exacting proper reward just for sharing his enormous intellectual assets. 

“Now, Nav”, said Uncle Gnarley, in a less than perfect
Scottish brogue, “pour me another ‘wee dram’ and I will finish off my comments
on this fellow, JM”.  As I did so, Gnarly
proceeded to recite his dissertation.

“Nav, JM understood the most essential concept in the field
of economics: in case you didn’t pass any subject beyond the fifth grade, I am
referring to the fundamental principles of supply and demand.  Now, I did not agree with everything JM had
to say, but he should be applauded for all that he did say.  He left us with many vital questions which
even today remain unanswered, while Nalcor continues to spend $12-15 million
dollars of public money each and every month”.

“On the issue of electrical demand, his expertise was
unassailable.  Follow me now, lad! To
justify spending $5 billion, Nalcor ought to be expected to prove, beyond a
shadow of a doubt, that there will be a demand for this power in the future and
not merely for the purpose of replacing Holyrood, either.  JM, some other members of the public or me
should not have to provide this assurance. On that point, my dear man, they
have failed miserably”.

“Throughout my reading of the papers you gave me, I have
been sceptical of Nalcor’s approach, and JM has shown that serious danger
exists when the wrong econometric model is used, er… now Nav, before your
eyes glaze over, this is not tiddly winks, but it is not nearly as complicated
as it sounds, either.  Modelling is used
by economists and statisticians all the time; essentially, it is a tool to predict
the future, using a series of historical data; it gives you a projection curve
and it all looks nice and pretty, especially in these days of colour
printing….my goodness, Nav, how much more could I have charged some of my
private clients with that little invention. 
Oh my! Oh my!”

“Of course, Nav”, Uncle Gnarley continued, “as any student
knows, if you have constructed your model poorly or merely chose the wrong one,
as Nalcor appears to have done; well, what is it that the young people say,
‘garbage in-garbage out’? But sometimes these ‘linear progression models’, as
we call them, are simply inappropriate to the task.  They might work fine in a place like Ontario
or Alberta.  These Provinces each have a
history of consistent economic growth coupled with a larger population and
industrial base and hence, a broader statistical foundation.   But, it’s very tough, Nav, to build a model
given our small population and given too, that we simply have not grown these
past many years”. 

“In fact, you should know, Nav, that Newfoundland and
Labrador suffered through 20 years of 0.1% growth since 1980 plus another five
years when growth was in the negative; this has not been a place to refer to
billions of anything, let alone dollars. 
Now, all of a sudden, we are expected to believe that we need a phenomenally
large block of power and that we should mortgage, not just our children, but
our grand-children and our great-grand-children, too, in order to get it.  You do have to wonder what is motivating
these people, Nav.  But that’s another
story.  Let me finish this one.  I say, Nav, it does get more ridiculous.

Indeed, my boy, I fear I may need another small snort of
that gorgeous liquid, as a bad taste in my mouth keeps reappearing and I fear
it has nothing to do with our Scotch friend. Were we influenced more by the
Scots as an intelligent, prudent and wonderful people, I expect we would not be
in this fine mess.
Des Sullivan
Des Sullivan
St. John's, Newfoundland and Labrador, Canada Uncle Gnarley is hosted by Des Sullivan, of St. John's. He is a businessman engaged over three decades in real estate management and development companies and in retail. He is currently a Director of Dorset Investments Limited and Donovan Holdings Limited. During his early career he served as Executive Assistant to Premier's Frank D. Moores (1975-1979) and Brian Peckford (1979-1985). He also served as a Part-Time Board Member on the Canada-Newfoundland Labrador Offshore Petroleum Board (C-NLOPB). Uncle Gnarley appears on the masthead representing serious and unambiguous positions on NL politics and public policy. Uncle Gnarley is a fiscal conservative possessing distinctly liberal values and a non-partisan persusasion. Those values and opinions underlie this writer's views on NL's politics, economy and society. Uncle Gnarley publishes Monday mornings and more often when events warrant.


Bill left public life shortly after the signing of the Atlantic Accord and became a member of the Court of Appeal until his retirement in 2003. During his time on the court he was involved in a number of successful appeals which overturned wrongful convictions, for which he was recognized by Innocence Canada. Bill had a special place in his heart for the underdog.

Churchill Falls Explainer (Coles Notes version)

If CFLCo is required to maximize its profit, then CFLCo should sell its electricity to the highest bidder(s) on the most advantageous terms available.


This is the most important set of negotiations we have engaged in since the Atlantic Accord and Hibernia. Despite being a small jurisdiction we proved to be smart and nimble enough to negotiate good deals on both. They have stood the test of time and have resulted in billions of dollars in royalties and created an industry which represents over a quarter of our economy. Will we prove to be smart and nimble enough to do the same with the Upper Churchill?