Wednesday, December 16, 2015


On November 5th 2008, than Premier Danny Williams told the St. John’s CBC Morning Show “We have no control over oil and commodity prices.”  The Great Recession of 2008-09 had arrived on our shores.  

The province rolled out an infrastructure development plan designed to stimulate job growth and business expansion.  Enlightened decision-making, employed throughout the Western World, may have staved off a return to the 1930’s but the economic storm clouds have remained on the horizon.

For arguments sake, it might be said that the Progressive Conservatives benefited from a serendipitous upturn in natural resource prices, particularly oil, which coincided with peak production.  The talk of success through growing the economy, sound fiscal management and leadership was really attributable to timing – blind luck!

Other sectors in the province had the stuffing kicked out of it. Jobs were lost with the demise of FPI, paper mills in Grand Falls and Stephenville, the closure of boot factory in Harbour Grace, the failure of construction companies, closure of the cement plant in Corner Brook, to name a few that pop to mind.

Now that the Alberta oil boom has gone bust, thousands of Newfoundlanders and Labradorians who made their money in Alberta to pay power bills, buy the groceries, purchase life's necessities and kept many rural communities afloat,  are without incomes.

With the exception of the expansion of the aquaculture industry on the South Coast there was very little, to no diversification of the economy. In fact, we are more reliant on a single staple resource than at any other period in our history. Thousands of jobs have vanished forever. To say we are in a pickle may be an uncomfortable and inconvenient truth, but a correction is needed.

Proud, strong and determined. The government tackled the public pension issues, paid down a few billion on the debt, invested in roads, ferries, schools, children, health and education.

Yet, here we are again, sitting on top of the economic precipice with failing infrastructure, record debt levels and less economic diversification than any time in our history.

I have no idea where we are headed; I have burned too many bridges speaking truth to power to be included in the process to come. We need less blind loyalists with their black and white partisan views and more honesty about our real circumstances.

The Liberals are promising to do what no other administration in our long history have been able to do - create sustainable opportunities in short order.  A plan that met with much ridicule from economists during the last campaign.

The sooner we are honest about living beyond our means and start making the changes necessary to survive, the better our odds of pulling through to experience a better tomorrow.

I for one am sick to my stomach, and worried, despite the assurances from politicians. I wonder what can I do to protect my family, how bad will this get if we do not address the systematic weaknesses that have always plagued our province since confederation?

It is time to take off the rose colored glasses, drop the romanticism and provide the leadership and direction that will ensure a better tomorrow.  No one said it would be easy.

If a major hurricane were forecast to hit St. John's we would be boarding up our windows, cleaning out drains, checking our sub-pumps, evaluating our emergency measure procedures and preparing for the storm.

There is a category 5 economic storm bearing down on us. It is time to batten down the hatches, prepare and head to the high ground.

1 comment:

Anonymous said...

You are exactly correct, Peter. I note that during the period of our oil windfall, most of the bonanza was actually "invested" in increasing the size of the civil service, job re-classifications and wage increases. Very little was invested in diversification and infrastructure.

I believe the provincial Liberals are gambling on the Hebron development saving them. Yes, the boost in oil production will help and oil prices will probably recover somewhat. However, we are still looking at billions (say six) in revenue shortfall until Hebron starts production and even then we are probably looking at huge deficits. It is going to be a very dicey four years.

It would be nice if we could be like Danny Williams: buy 500 hectares of "worthless" public land while premier; change the law while he was premier to make it worth a fortune; and proceed to quit and become a real estate developer.