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Bitter legacy hangs over today’s energy discussions between Quebec and N.L. premiers

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Newfoundland and Labrador Premier Andrew Furey and Quebec Premier François Legault pose in the office of the premier at the Confederation Building, in St. John’s, on Friday, Feb. 24, 2023. THE CANADIAN PRESS/Paul Daly

By Sarah Smellie in St. John’s

As Quebec Premier François Legault seeks a new energy deal with Newfoundland and Labrador, he faces a public in the Atlantic province scarred by the legacy of a pair of hydroelectric projects mired in missteps.

Legault travelled to St. John’s this week for discussions with Newfoundland and Labrador Premier Andrew Furey about the 1969 Churchill Falls hydroelectric energy deal — and what will come after it ends in 2041. The lopsided deal heavily favours Quebec, and has left a lasting bitterness in Newfoundland and Labrador.

The two leaders are scheduled to speak with reporters later on Friday after the meeting.

Jeff Webb, a historian at Memorial University, says some residents of Newfoundland and Labrador think the province wouldn’t have endured the “humiliation” of needing equalization payments from the federal government if the Churchill Falls agreement had more evenly served both provinces.

“It does speak to people’s sense that this is something that’s always been rightly ours, and it’s been stolen,” Webb said in a recent interview.

Decades later, that hostility drove people in Newfoundland and Labrador to embrace the Muskrat Falls hydroelectric project, which is long delayed and draining the provincial purse, Webb said.

The 1969 Churchill Falls deal allows Quebec’s provincially owned hydroelectric utility, Hydro-Québec, to purchase 85 per cent of the electricity generated by the dam in Labrador, and therefore reap most of the profits. As of 2019, the deal had yielded close to $28 billion in profits to Quebec, and about $2 billion for Newfoundland and Labrador.

Under the agreement, Hydro-Québec pays a fixed price of 0.2 cents per kilowatt hour for Churchill Falls power. By comparison, the utility said in a news release this week it made an average of 8.2 cents per kilowatt hour on power it sold outside the province in 2022. Hydro-Québec made a record-breaking income of $4.6 billion last year, the release said.

The Innu of Uashat mak Mani-utenam in Quebec filed a $2.2-billion lawsuit against Hydro-Québec earlier this year, claiming the Churchill Falls hydroelectric station has destroyed a significant part of their traditional territory. In 2020, the Innu Nation in Labrador launched a $4-billion lawsuit against Hydro-Québec and Churchill Falls (Labrador) Corp., a subsidiary of Newfoundland and Labrador Hydro, for the ecological and cultural damage caused by the damming of the upper Churchill River in the early 1970s.

Pam Frampton, who retired in 2021 as the managing editor of The Telegram newspaper in St. John’s, said she grew up under the shadow of Churchill Falls.

“There was always these associated feelings of shame and bitterness, and the feeling that we had been duped,” Frampton said in an interview.

Frampton said she believes the province would be in a completely different economic position now if the Churchill Falls arrangement had not been so skewed.

“Wanting to give Quebec the middle finger, if you will, was a part of the impetus behind Muskrat Falls,” Frampton said. “I think if we had a fair day’s deal with (Churchill Falls), we wouldn’t have been so hell-bent on getting (Muskrat Falls) developed at any cost.”

Like the Churchill Falls project, the Muskrat Falls development harnesses the power of the Churchill River, in Labrador, and it also sits on traditional Innu territory. It was green-lit in December of 2012 after much trumpeting and fanfare by the Progressive Conservative government at the time, particularly by premier Danny Williams, who quit politics in late 2010.

Muskrat Falls has been disastrous for the province’s finances and morale. Its price tag now sits at more than $13 billion, a figure Andrew Furey described in 2021 as “an anchor around the collective souls of Newfoundland and Labradorians.”

Legault has said he wants a “win-win” deal for Quebec and Newfoundland and Labrador — and has even suggested paying the province more for electricity before the current deal ends in 2041.

Frampton said the Quebec premier needs to know that the people of Newfoundland and Labrador are hardened and still smarting from both projects.

“I think he needs to know that, going in, we are gun shy, and for good reason,” she said. “He should expect us to ask the hard questions. And I certainly hope to God our government does, on our behalf.”

This report by The Canadian Press was first published Feb. 24, 2023.

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Top Brass Is On The Run Ahead Of Trump’s Return

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From the Daily Caller News Foundation

By Morgan Murphy

With less than a month to go before President-elect Donald Trump takes office, the top brass are already running for cover. This week the Army’s chief of staff, Gen. Randy George, pledged to cut approximately a dozen general officers from the U.S. Army.

It is a start.

But given the Army is authorized 219 general officers, cutting just 12 is using a scalpel when a machete is in order. At present, the ratio of officers to enlisted personnel stands at an all-time high. During World War II, we had one general for every 6,000 troops. Today, we have one for every 1,600.

Right now, the United States has 1.3 million active-duty service members according to the Defense Manpower Data Center. Of those, 885 are flag officers (fun fact: you get your own flag when you make general or admiral, hence the term “flag officer” and “flagship”). In the reserve world, the ratio is even worse. There are 925 general and flag officers and a total reserve force of just 760,499 personnel. That is a flag for every 674 enlisted troops.

The hallways at the Pentagon are filled with a constellation of stars and the legions of staffers who support them. I’ve worked in both the Office of the Secretary of Defense and the Joint Chiefs of Staff. Starting around 2011, the Joint Staff began to surge in scope and power. Though the chairman of the Joint Chiefs is not in the chain of command and simply serves as an advisor to the president, there are a staggering 4,409 people working for the Joint Staff, including 1,400 civilians with an average salary of $196,800 (yes, you read that correctly). The Joint Staff budget for 2025 is estimated by the Department of Defense’s comptroller to be $1.3 billion.

In contrast, the Secretary of Defense — the civilian in charge of running our nation’s military — has a staff of 2,646 civilians and uniformed personnel. The disparity between the two staffs threatens the longstanding American principle of civilian control of the military.

Just look at what happens when civilians in the White House or the Senate dare question the ranks of America’s general class. “Politicizing the military!” critics cry, as if the Commander-in-Chief has no right to question the judgement of generals who botched the withdrawal from Afghanistan, bought into the woke ideology of diversity, equity and inclusion (DEI) or oversaw over-budget and behind-schedule weapons systems. Introducing accountability to the general class is not politicizing our nation’s military — it is called leadership.

What most Americans don’t understand is that our top brass is already very political. On any given day in our nation’s Capitol, a casual visitor is likely to run into multiple generals and admirals visiting our elected representatives and their staff. Ostensibly, these “briefs” are about various strategic threats and weapons systems — but everyone on the Hill knows our military leaders are also jockeying for their next assignment or promotion. It’s classic politics

The country witnessed this firsthand with now-retired Gen. Mark Milley. Most Americans were put off by what they saw. Milley brazenly played the Washington spin game, bragging in a Senate Armed Services hearing that he had interviewed with Bob Woodward and a host of other Washington, D.C. reporters.

Woodward later admitted in an interview with CNN that he was flabbergasted by Milley, recalling the chairman hadn’t just said “[Trump] is a problem or we can’t trust him,” but took it to the point of saying, “he is a danger to the country. He is the most dangerous person I know.” Woodward said that Milley’s attitude felt like an assignment editor ordering him, “Do something about this.”

Think on that a moment — an active-duty four star general spoke on the record, disparaging the Commander-in-Chief. Not only did it show rank insubordination and a breach of Uniform Code of Military Justice Article 88, but Milley’s actions represented a grave threat against the Constitution and civilian oversight of the military.

How will it play out now that Trump has returned? Old political hands know that what goes around comes around. Milley’s ham-handed political meddling may very well pave the way for a massive reorganization of flag officers similar to Gen. George C. Marshall’s “plucking board” of 1940. Marshall forced 500 colonels into retirement saying, “You give a good leader very little and he will succeed; you give mediocrity a great deal and they will fail.”

Marshall’s efforts to reorient the War Department to a meritocracy proved prescient when the United States entered World War II less than two years later.

Perhaps it’s time for another plucking board to remind the military brass that it is their civilian bosses who sit at the top of the U.S. chain of command.

Morgan Murphy is military thought leader, former press secretary to the Secretary of Defense and national security advisor in the U.S. Senate.

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For the record—former finance minister did not keep Canada’s ‘fiscal powder dry’

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From the Fraser Institute

By Ben Eisen

In case you haven’t heard, Chrystia Freeland resigned from cabinet on Monday. Reportedly, the straw that broke the camel’s back was Prime Minister Trudeau’s plan to send all Canadians earning up to $150,000 a onetime $250 tax “rebate.” In her resignation letter, Freeland seemingly took aim at this ill-advised waste of money by noting “costly political gimmicks.” She could not have been more right, as my colleagues and I have written herehere and elsewhere.

Indeed, Freeland was right to excoriate the government for a onetime rebate cheque that would do nothing to help Canada’s long-term economic growth prospects, but her reasoning was curious given her record in office. She wrote that such gimmicks were unwise because Canada must keep its “fiscal powder dry” given the possibility of trade disputes with the United States.

Again, to a large extent Freeland’s logic is sound. Emergencies come up from time to time, and governments should be particularly frugal with public dollars during non-emergency periods so money is available when hard times come.

For example, the federal government’s generally restrained approach to spending during the 1990s and 2000s was an important reason Canada went into the pandemic with its books in better shape than most other countries. This is an example of how keeping “fiscal powder dry” can help a government be ready when emergencies strike.

However, much of the sentiment in Freeland’s resignation letter does not match her record as finance minister.

Of course, during the pandemic and its immediate aftermath, it’s understandable that the federal government ran large deficits. However, several years have now past and the Trudeau government has run large continuous deficits. This year, the government forecasts a $48.3 billion deficit, which is larger than the $40 billion target the government had previously set.

A finance minister committed to keeping Canada’s fiscal powder dry would have pushed for balanced budgets so Ottawa could start shrinking the massive debt burden accumulated during COVID. Instead, deficits persisted and debt has continued to climb. As a result, federal debt may spike beyond levels reached during the pandemic if another emergency strikes.

Minister Freeland’s reported decision to oppose the planned $250 onetime tax rebates is commendable. But we should be cautious not to rewrite history. Despite Freeland’s stated desire to keep Canada’s “fiscal powder dry,” this was not the story of her tenure as finance minister. Instead, the story is one of continuous deficits and growing debt, which have hurt Canada’s capacity to withstand the next fiscal emergency whenever it does arrive.

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