TOM OSBORNE and LANA PAYNE on Different Pages

In a
Telegram story by James McLeod, Saturday April 6, 2013, “MHA says deep budget cuts could have been avoided”, based upon an
interview with Tom Osborne, the Member could not have better revealed the
origins of the current Budget mess: 

“Sitting around the caucus table in
2008 and 2009, we were talking as a caucus that there was going to be a
decrease in oil production, and a decrease in oil revenues, and the Atlantic
Accord transfers were going to run out. 
Yet the Budget continued to grow. 
That’s the point that I’m making”, he said. “With the proper management,
we could have been in the position where we had a slightly smaller budget
without having to make the cuts today”.

There are
those who think Government money is different than what you and I spend; that it
has a pedigree that makes it special.  They
want to join the legion of Governments for whom only the bondholders possess an
ability to apply the fiscal brakes.

Lana Payne subscribes
to the, spend, spend, spend idea, too (funny how well socialist ideology can
blend with Tory incompetence). In fact, she believes the Government doesn’t
spend enough.  Leaving Tommy for a
minute, flip over to page A21 of the same Telegram Edition, we are treated to
Lana’s Column: ‘Newfoundland and
Labrador: Welcome to Austerity’
.  Payne
thinks, not only that the cuts may be the wrong ones (she might be correct on
that count), but that the Government should not institute cut backs at all.  In other words, for the current Tories, as it
is for Lana, it is acceptable to pile up public debt and to steal from future
generations. 

If you have paid
attention to the ‘structured’ bankruptcies of Greece and Cyprus or to the
severe challenges that Spain, Italy and other countries are facing, you need no
reminding that debtors expect to be repaid and that a Government’s inability to
pay them causes enormous social and economic grief. Yet, Ms. Payne states, “In
Europe, the harmful and devastating impact of austerity is driving up
unemployment to unprecedented levels”. I ask: who is going to lend to these
countries, after years of irresponsible management, debt levels in excess of
100% of GDP and an unwillingness to strengthen their institutions to collect
taxes equitably. For most of them, austerity is the only alternative to
bankruptcy.  They do not have the option
of more spending.    What a position for a Government to be in!

Payne
further comments: “The cuts also contradict past government strategies and
goals:”  The only other Government in NL
history that has enjoyed the fiscal room to double public spending over the
last decade is the Williams Administration; that is the source of the current
problem.

Let me draw
your attention to the point that Osborne is making.  He, having been inside the Tory Caucus and
Government for many years, confirms that Dunderdale and Co. knew, all along,
that there would be a day of reckoning; that NL would experience lower oil
production numbers, elimination of the Atlantic Accord transfers and gee, that oil
prices are volatile!  Of course, we knew
they knew; an acknowledgement he has merely underlined!
Lana Payne
is fundamentally no different than this bunch of Tories; she sports a different
political ideology (though, I’m not really sure if the Tories have one, these
days); but, like the Tories, she advocates a similar spending prowess.  It is rhetoric, of course, but what is the
value of empty rhetoric to a laid-off public servant?

Ms. Payne
states that, “The government ought to know that there is a problem with
theories.  It is a nasty thing called
reality”.  I will only give her this much:
paring staff, within an organization, whether business or government, is no
easy task.  Ensuring that the quantity
and type of skills are present, to guarantee a minimum standard of service, is
a very complex business. It can’t be hacked at like Kennedy did in the
Department of Justice.  It can’t be dealt
with by the rhetoric of a union politician, either.

A
professional public service does not need to be a bloated public service.  Public servants deserve more respect than
this condition implies.  Government
bureaucracy should be expanded slowly and trimmed, if necessary, at the same slow
speed.  When do mass lay-offs not damage
an economy and society? 

Then, there
is this part of Osborne’s comment: “With the proper management, we could have
been in the position where we had a slightly smaller budget without having to
make the cuts today”.

These
remarks are heading in the direction of common sense.  Unfortunately, we can’t credit him with
having helped contribute to a better outcome. 
If the personal anguish, suffered over the past few weeks by public
servants, can’t teach us that failing to perform good budgetary practice, that thoughtlessly
fattening up the public service is wrong, or that the uncertainty of resource revenues
demands stronger fiscal managers than we have elected in recent years, when are
we ever going to learn – when we mirror Greece or Cyprus?

I wonder if Ms.
Payne thinks that the deficit in the public service pension plan is even a debt
at all; one that has to be paid, no differently than what is owed to the
bondholders. Does she not know that some of those public servants may even be
some of those bondholders?   Perhaps,
they should check the mutual funds in their RRSPs.

Anyway,
Tommy, if you are thinking of joining the NDP, you had better check some of
those ‘old’ Tory ideas with Lana Payne, first.
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.

NALCOR (Masquerading as ‘Hydro’)LIVES IN AN UPSIDE DOWN WORLD

If a Big Mac costs McDonalds $10 to produce and it is sold for $1.50, McDonalds will go out of business. They would not declare a profit!

REMEMBERING BILL MARSHALL

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.

3 COMMENTS

  1. the economist Paul Krugman has made the point that the situation in Greece is much worse than the situation in Iceland, even though the genesis of the issues are the same, as Iceland simply allowed its banks to fail, and absorbed the impact on its currency, as opposed to its citizens.

    We have fewer options, when the collector comes.
    We've taken windfall profits and pretended they were annual revenues, and then offered a confusing melange of statements about our status vis a vis equalization as a substitute for honesty about our discretionary resources. This will be recorded as the greatest opportunity lost in our history. Everyone involved should apologise.

  2. Somewhat disingenous on Mr. Osborne's part. I wonder if he could elaborate on the number of district people he managed to stuff into the public service while he was in the position to do so. It was a lot.

    Meanwhile, he will do what suits HIM best. If Justin Trudeau creates a buzz that translates here and provincial Libs get a good leader, Tommy may go Liberal – that opens prov and fed options for him. If he sees NDP as his chance to keep his townie seat, he'll go NDP. If a new leader shakes up the PCs, he may go back into the fold as a 'fresh' face. Either way it's all about Tommy Boy's chances to collect a cheque and possibly be part of a little club again.