A Blue Saskatchewan Cry
Ric Dolphin - Monday,12 February 2007
WESTERN Standard
It is written that any successful prime minister of Canada must cheerfully serve as Quebec's harlot, and Calgary's own Stephen Harper has yet to disprove that perennial dictum. To wit:
Jean Charest: "Zut alors, we 'ave dis feescal imbalance thingy. Stevie, my leetle strumpet, come give Daddy some sucre."
Stephen Harper: "By jeepers you're right, Mon-sewer Premier. Here, have a billion-and-a-half extra. Please tell whatever friends you may have to vote for me in the federal election."
JC: "Who's yo' papa?"
SH: "You are, sir."
(And yes, I know Charest's first and best language is English, but how much fun is that?)
Viewed from Alberta, such harlotry miffs one a tad, but after decades of it, one grows blasé. We've been sending more money eastward than we've gotten back for decades. But we now have so much cash, the inequity is for the nonce a minor annoyance.
Saskatchewan, however, is a relatively new victim of Ottawa--Quebec politics, so it regards the federal channelling of its cash through Lower Canada bank accounts as unnatural, and is squalling like a newbie.
As described in my last column, Saskatchewan has all the stuff the world currently holds dear and is becoming Alberta II. Thanks to royalities on these zooming resources, Premier Lorne Calvert's government is looking at an unplanned billion dollars in revenue for the current fiscal year. The old gopher's grown a golden fleece.
Now one might think a social democrat like lugubrious Lorne would be delighted that the waifs in have-not provinces like P.E.I. and Quebec get extra equalization cash to subsidize their day cares and appease their unions. But it seems there are no socialists in the trenches when those trenches fill with bubbling crude. So Pastor Calvert has become Gordon Gekko (of Wall Street) in a bad suit. Greed, it seems, is not such a bad thing.
Calvert recently launched a public relations campaign entitled "Imagine" (Gekko-ization not curtailing the left's fetishization of the John Lennon dirge). Without getting into tiresome details, the NDP's $300,000 campaign calls on Saskatchewanians to "imagine" what life would be like with the extra $800 million the damned feds aren't coughing up.
"Imagine what $800 million would do to build our economy and communities, ensuring an attractive future for our youth right here in Saskatchewan," says Calvert.
What prompted Calvert's campaign? Ostensibly it was federal Finance Minister Jim Flaherty's announcement that the feds were guaranteeing $11.7 billion in equalization payments for 2007-08. Manitoba, New Brunswick and P.E.I. get a few million more, Newfoundland and Nova Scotia a few million less. Quebec gets an extra billion or more a year. Saskatchewan gets squat.
Flaherty's announcement--to be fleshed out properly in the spring federal budget--seems to be based on the recommendations from a panel last year, led by former Alberta bureaucrat Al O'Brien. Its salient feature was the inclusion of 50 per cent of a province's--in particular, Alberta's--oil revenues in the calculation of the equalization formula.
Now, I could spend several hundred words explaining the bureaucrat-created hell of equalization, and neither of us would fully understand it. But briefly: the provinces get equalization payments if their per capita tax take falls below a five-province average--the five being Ontario, Quebec, Manitoba, British Columbia and Saskatchewan.
Since an electioneering Paul Martin caved in to that little Tasmanian Devil from Newfoundland, Danny Williams, oil revenues had been partially excluded from the tax take for Newfoundland and Nova Scotia. This enabled those provinces to stay below the average and therefore remain eligble for hundreds of millions more in equalization loot than they would have otherwise.
Saskatchewan--until a few years ago an equalization recipient--did not get this sweet deal. And, according to a report prepared for the province by Saskatchewan equalization guru Tom Courchene, the land of oily wheat was getting screwed to the tune of $800 million a year in unrealized equalization payments. Calvert's gang has carried this amount forward as an ongoing annual shortfall.
It's true--as Calvert continues to point out--that Harper promised in his 2006 election campaign not to include renewable resource revenue in the equalization formula. But that promise was made before Quebec bestowed an unexpected 10 seats on the Conservatives, offering a tantalizing beachhead from which to build a majority government. Saskatchewan may have elected CPCers to 12 of its 14 ridings, but as every prime minister in Canadian history learns, you're nobody until Quebec loves you.
Quebec, along with its catamites Manitoba, New Brunswick and P.E.I., wanted oil revenues included in the provincial averaging--something the other six provinces decried to varying degrees.
Flaherty's recent nod to the O'Brien report suggests that 50 per cent of the oil and gas revenues from B.C., Saskatchewan, Newfoundland and especially Alberta--which still produces 70 per cent of Canada's oil--will be included in calculating the average provincial tax base.
Also, in calculating what a particular province takes in taxes, and whether that province deserves equalization top-ups, 50 per cent of its own oil revenues are to be calculated in. If that revenue takes a province out of equalization, as it does Saskatchewan, too bad.
Meanwhile, oil-less provinces will be topped up by the amount that they would be getting from oil, were they to have any. Got that? Thought not. Let's move on.
All you really need to know about the phantom oil bonus is that it means an extra $1 billion a year for Quebec and possibly another half bil come budget time. This naturally pleases the Charest government, which faces an election this year. Prospects of beating the PQ--ahead in the polls for three years--are much better if Jean can wave around a cheque for $1.5 billion and boast about being maître chez Stevie.
Meanwhile, Harper risks alienating those who brung him--such as Saskatchewan's 12 birds in the hand. One prays that his role as Quebec's bitch is a gambit designed to secure a majority government. At that point, one further hopes, he'll come to his senses and dismantle the whole divisive equalization scheme and lay off the zillion civil servants who have made careers out of keeping it dysfunctional. Straight per capita grants to provinces, as is the case with health transfers, would be a far simpler and ultimately less divisive method of spreading the welfare to the basket-case provinces.
But appeasing Quebec is the crack cocaine of Canadian politics. Once the froggies start hitting you with their votes, you become silly for more. So maybe Stevie is lost. Won't be able to tell for sure until after he gets a majority.
As for Lorne, his new role as defender of Saskatchewan's moolah is mostly politics. His selectively conservative behaviour of late seems designed to neutralize the Opposition in preparation for this year's possible election. He's put taxes down, cut the PST, and now he's bellowing at Ottawa for more money like a Danny Williams, though without the zealous conviction of the Tasmanian. All this steals thunder from the conservative Saskatchewan Party of Brad Wall--but probably not enough.
Lorne and his government are old, tired, and their polls lag well behind Wall's. The public service unions and Crown corporations wag the dog of government and stymie growth. Rich province or not, youth continues to flee, and the urban Indian problem--the elephant in the room that no one wants to discuss--is a disincentive to residency. Let's face it, Saskatchewan just isn't a cool place to live, and a bunch of socialist old farts aren't likely to change that.
The Calvertistas fight with Ottawa is a distraction. It resembles former NDP premier Allan Blakeney's squabble in 1982 over a grain subsidy called the Crow rate. The squabble failed to ignite the populace and save Blakeney's old and tired government, swept away in the Grant Devine Conservative landslide of 1982. SP's Wall was an aide and protegé of Devine. The upcoming election is his to lose.
Ric Dolphin - Monday,12 February 2007
WESTERN Standard
It is written that any successful prime minister of Canada must cheerfully serve as Quebec's harlot, and Calgary's own Stephen Harper has yet to disprove that perennial dictum. To wit:
Jean Charest: "Zut alors, we 'ave dis feescal imbalance thingy. Stevie, my leetle strumpet, come give Daddy some sucre."
Stephen Harper: "By jeepers you're right, Mon-sewer Premier. Here, have a billion-and-a-half extra. Please tell whatever friends you may have to vote for me in the federal election."
JC: "Who's yo' papa?"
SH: "You are, sir."
(And yes, I know Charest's first and best language is English, but how much fun is that?)
Viewed from Alberta, such harlotry miffs one a tad, but after decades of it, one grows blasé. We've been sending more money eastward than we've gotten back for decades. But we now have so much cash, the inequity is for the nonce a minor annoyance.
Saskatchewan, however, is a relatively new victim of Ottawa--Quebec politics, so it regards the federal channelling of its cash through Lower Canada bank accounts as unnatural, and is squalling like a newbie.
As described in my last column, Saskatchewan has all the stuff the world currently holds dear and is becoming Alberta II. Thanks to royalities on these zooming resources, Premier Lorne Calvert's government is looking at an unplanned billion dollars in revenue for the current fiscal year. The old gopher's grown a golden fleece.
Now one might think a social democrat like lugubrious Lorne would be delighted that the waifs in have-not provinces like P.E.I. and Quebec get extra equalization cash to subsidize their day cares and appease their unions. But it seems there are no socialists in the trenches when those trenches fill with bubbling crude. So Pastor Calvert has become Gordon Gekko (of Wall Street) in a bad suit. Greed, it seems, is not such a bad thing.
Calvert recently launched a public relations campaign entitled "Imagine" (Gekko-ization not curtailing the left's fetishization of the John Lennon dirge). Without getting into tiresome details, the NDP's $300,000 campaign calls on Saskatchewanians to "imagine" what life would be like with the extra $800 million the damned feds aren't coughing up.
"Imagine what $800 million would do to build our economy and communities, ensuring an attractive future for our youth right here in Saskatchewan," says Calvert.
What prompted Calvert's campaign? Ostensibly it was federal Finance Minister Jim Flaherty's announcement that the feds were guaranteeing $11.7 billion in equalization payments for 2007-08. Manitoba, New Brunswick and P.E.I. get a few million more, Newfoundland and Nova Scotia a few million less. Quebec gets an extra billion or more a year. Saskatchewan gets squat.
Flaherty's announcement--to be fleshed out properly in the spring federal budget--seems to be based on the recommendations from a panel last year, led by former Alberta bureaucrat Al O'Brien. Its salient feature was the inclusion of 50 per cent of a province's--in particular, Alberta's--oil revenues in the calculation of the equalization formula.
Now, I could spend several hundred words explaining the bureaucrat-created hell of equalization, and neither of us would fully understand it. But briefly: the provinces get equalization payments if their per capita tax take falls below a five-province average--the five being Ontario, Quebec, Manitoba, British Columbia and Saskatchewan.
Since an electioneering Paul Martin caved in to that little Tasmanian Devil from Newfoundland, Danny Williams, oil revenues had been partially excluded from the tax take for Newfoundland and Nova Scotia. This enabled those provinces to stay below the average and therefore remain eligble for hundreds of millions more in equalization loot than they would have otherwise.
Saskatchewan--until a few years ago an equalization recipient--did not get this sweet deal. And, according to a report prepared for the province by Saskatchewan equalization guru Tom Courchene, the land of oily wheat was getting screwed to the tune of $800 million a year in unrealized equalization payments. Calvert's gang has carried this amount forward as an ongoing annual shortfall.
It's true--as Calvert continues to point out--that Harper promised in his 2006 election campaign not to include renewable resource revenue in the equalization formula. But that promise was made before Quebec bestowed an unexpected 10 seats on the Conservatives, offering a tantalizing beachhead from which to build a majority government. Saskatchewan may have elected CPCers to 12 of its 14 ridings, but as every prime minister in Canadian history learns, you're nobody until Quebec loves you.
Quebec, along with its catamites Manitoba, New Brunswick and P.E.I., wanted oil revenues included in the provincial averaging--something the other six provinces decried to varying degrees.
Flaherty's recent nod to the O'Brien report suggests that 50 per cent of the oil and gas revenues from B.C., Saskatchewan, Newfoundland and especially Alberta--which still produces 70 per cent of Canada's oil--will be included in calculating the average provincial tax base.
Also, in calculating what a particular province takes in taxes, and whether that province deserves equalization top-ups, 50 per cent of its own oil revenues are to be calculated in. If that revenue takes a province out of equalization, as it does Saskatchewan, too bad.
Meanwhile, oil-less provinces will be topped up by the amount that they would be getting from oil, were they to have any. Got that? Thought not. Let's move on.
All you really need to know about the phantom oil bonus is that it means an extra $1 billion a year for Quebec and possibly another half bil come budget time. This naturally pleases the Charest government, which faces an election this year. Prospects of beating the PQ--ahead in the polls for three years--are much better if Jean can wave around a cheque for $1.5 billion and boast about being maître chez Stevie.
Meanwhile, Harper risks alienating those who brung him--such as Saskatchewan's 12 birds in the hand. One prays that his role as Quebec's bitch is a gambit designed to secure a majority government. At that point, one further hopes, he'll come to his senses and dismantle the whole divisive equalization scheme and lay off the zillion civil servants who have made careers out of keeping it dysfunctional. Straight per capita grants to provinces, as is the case with health transfers, would be a far simpler and ultimately less divisive method of spreading the welfare to the basket-case provinces.
But appeasing Quebec is the crack cocaine of Canadian politics. Once the froggies start hitting you with their votes, you become silly for more. So maybe Stevie is lost. Won't be able to tell for sure until after he gets a majority.
As for Lorne, his new role as defender of Saskatchewan's moolah is mostly politics. His selectively conservative behaviour of late seems designed to neutralize the Opposition in preparation for this year's possible election. He's put taxes down, cut the PST, and now he's bellowing at Ottawa for more money like a Danny Williams, though without the zealous conviction of the Tasmanian. All this steals thunder from the conservative Saskatchewan Party of Brad Wall--but probably not enough.
Lorne and his government are old, tired, and their polls lag well behind Wall's. The public service unions and Crown corporations wag the dog of government and stymie growth. Rich province or not, youth continues to flee, and the urban Indian problem--the elephant in the room that no one wants to discuss--is a disincentive to residency. Let's face it, Saskatchewan just isn't a cool place to live, and a bunch of socialist old farts aren't likely to change that.
The Calvertistas fight with Ottawa is a distraction. It resembles former NDP premier Allan Blakeney's squabble in 1982 over a grain subsidy called the Crow rate. The squabble failed to ignite the populace and save Blakeney's old and tired government, swept away in the Grant Devine Conservative landslide of 1982. SP's Wall was an aide and protegé of Devine. The upcoming election is his to lose.