Never Mind Democracy

1 03 2015
[Editor: I included this article because it shows the shocking lack of interest in the process of democracy. “Stop fretting over popularity” means “never mind that a majority of NB citizens voted against a fracking government.”]
Shale gas: will this government lead, or will it merely be led?
Norbert Cunningham

The New Brunswick government is still sending mixed signals and at times is working at cross purposes to itself. Let it stop fretting over popularity and focus on making the right decisions.

The province needs strong leadership and undiluted measures to wrestle free of its fiscal and structural economic problems.

We need, once and for all, to achieve a sustainable economic foundation. Half measures and shortcuts will unnecessarily condemn us to going through similar difficulties a few years down the road.

So far the government’s record is a mixed bag. Last week Finance Minister Roger Melanson introduced the Act Respecting Responsible Governance. It will repeal the Taxpayer Protection Act, Fiscal Transparency and Accountability Act and Health Care Funding Guarantee Act.

In doing so, Mr. Melanson said,”A government cannot bind future legislatures to a specific budgetary policy.”

Among other things, this will eliminate the need to hold a referendum should the government decide it needs to return the HST to 15 per cent.

He’s correct. It’s silly and pointless for any government to try to dictate future financial policy. The targeted acts never had teeth nor substance, being merely symbolic gestures to earn the governments that passed them brownie points with voters.

It’s pointless: what one government legislates, another government can repeal. Anybody who thought the legislation actually meant anything took the bait hook, line and sinker.

In this case, our fiscal troubles are severe enough there is little question taxes will have to increase, be it the HST (which should bring in about $270 million) or others. The HST is a logical choice, but won’t be popular.

The reality is that if citizens or government want services untouched, reject shale gas, want expensive ‘job creation’ efforts, want to maintain public service jobs and so on, they have no choice.

We’re at the limit of our ability to simply service our debt now – continued borrowing to maintain the status quo will bankrupt us. The money has to be found. We can’t have it both ways.

Yet the government itself is trying to have it both ways. It wants, and must, find $600 million in permanent savings to slay deficits and start to reduce debt. But it also needs to address stubborn structural problems that cause deficits and hinder development. Just tossing more cash into ‘development’ is a failed strategy.

Yet the single best opportunity we have to help put us on a sustainable footing, shale gas, has been indefinitely rejected by this government. As noted here Saturday, it has no clear plan or timeline to try to meet the criteria it has set to enable gas development. This is myopic.

On Monday we learned the government is seeking proposals to develop potash further. Great idea! Too bad it’s moratorium on gas development is hurting our existing mines, eh?

The government didn’t have the common sense to grandfather a gas well that has operated 10 years without incident.

It has damaged the potash business’s bottom line and now it’s begging it to invest hundreds of millions more here.

To quote Dana Carvey’s Church Lady,”isn’t that special!”

The minister denied there is any contradiction or problem. Believe it if you wish. Imagine you own a mine. You’ve used cheaper local gas for many years, but are suddenly and arbitrarily told you can’t have it anymore. You’ll have to pay for costlier energy. How inclined will you be to do the perpetrator a favour, at higher cost?

The industry can afford to wait longer than the province can.

This is no small matter. It’s entirely possible there would be no need to hike the HST if the government showed more competence and consistency on these matters.

Meanwhile, whatever the government does to increase revenue, citizens would be well advised to watch this crew extremely closely. They promised all kinds of expensive goodies in their election campaign, including putting large amounts into ‘development’ efforts, yet they ignore measures that would spur huge development without costing taxpayers much at all.

If new revenue is raised in large amounts, it cannot be justified spending it on ineffective efforts. It must go to deficit and debt reduction.

The Liberals are often accused by opponents of being the ‘tax and spend party.’ It may not be entirely fair, but it’s worth noting it would be the worst possible approach given the province’s fiscal realities.

The government knows the realities. It’s time for it to prove it can deal with them by taking the full suite of tough measures rather than trying to have it both ways.

   After four, and then eight years, they’ll be much more highly regarded than if they continue with spineless political pandering. Great leaders and governments lead, they don’t squander opportunities.



One response

1 03 2015

Maybe the province can’t afford the Irvings of this world!

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