Prosperity schemes and dreams

A 40-year track record of failure did not put a damper on Ottawa’s latest multi-million-dollar effort to buy prosperity for Atlantic Canada, and neither did cynics who accused Prime Minister Jean Chretien of vote-buying in a region that snubbed his Liberal Party in the last federal election.

Oh sure there will be an election in the next year or so, Chretien admitted to reporters, but he didn’t “see” anyone seriously disagreeing with his latest prosperity dream. That may be technically true, his vision having been impaired by myopia for some time now, but at the very least he needs a hearing aid. The howls were immediate and could be heard across the land. Even local businessmen have warned that the $700-million cash infusion into the region’s high-tech sector could prove to be as counter-productive as some of the government’s previous regional development schemes.

What’s more, they’re not exactly thrilled that the program is being administered by the Atlantic Canada Opportunities Fund, widely perceived as a slush fund that hands out money to companies with more political savvy than business sense. And of course people are whispering that millions are coming from Ottawa’s recently dismantled Human Resources ministry, which is still fending off flak for not keeping proper tabs on about $1 billion of taxpayers’ money.

To be sure, some of the research funds are worthwhile and the government is at least targeting a growing sector of the economy. But, money markets being what they are, technology companies with good ideas and good management are able to attract venture capital. The fear is that the latest bag of free goodies will be allocated without much due diligence, resulting in Act Forty-One of the multi-billion-dollar production Government Boondoggles ‘R’ Us, still playing at the Atlantic Theatre of the Absurd.

Don’t get us wrong. Governments have a role to play in establishing a regulatory regime that stimulates private-sector investment. But the old-style handouts have hindered, rather than helped, Atlantic Canada’s efforts to build a sustainable economy. The proof is in the lack of pudding.

For decades, politicians of all stripes have promised the people that their particular pet-project would lead to the promised land. Who can forget the infamous $20-million Sprung cucumber fiasco in Newfoundland, which, alas, produced more heartaches than cucumbers? Or, more seriously, the Westray coal mine in Nova Scotia, where well-meaning government assistance helped produce more grief than coal? Or the Devco coal mine in Nova Scotia, which the federal government now hopes to sell after having invested a few billion doomed dollars — only nobody is knocking at the door, because opportunity doesn’t live there any more (if it ever did). Coal companies are having a hard enough time staying afloat at mines with higher grades and a better-quality product.

What’s even more insidious is that these programs have fostered the attitude that somehow politicians can “deliver prosperity.” Foremost among them was Joey Smallwood, former premier of Newfoundland and Labrador and consummate old-style politician who roused cheers as he crossed the province to announce a new day in the sun. Who can forget his backroom deal with promoter John Doyle for the Stephenville linerboard mill? Or John Shaheen’s Come-By-Chance oil refinery? Or the political bungle of the century — the Upper Churchill Development?

Contary to conventional wisdom, Smallwood, in the early days, had widespread support for his position on Upper Churchill. He forged ahead and pushed Brinco, through its subsidiary, Churchill Falls Labrador Corporation, to develop the project and sign the deal with Hydro-Qubec for the sale of power. It was only after Smallwood left office that some began to have second thoughts about the long-term, one-sided deal. Quebec got cheap power for almost an eternity, which it resells for billions. Quebec also got the lion’s share of the benefits from Labrador’s iron-ore resources. To say the people of Labrador are bitter about all this is an understatement.

Next came Premier Frank Moores, who was cheered when he announced plans to have the province develop the Lower Churchill power project on its own. Unfortunately, he couldn’t convince the banks to fork over the dough. And current Premier Brian Tobin was loudly cheered when he promised to “deliver” both Lower Churchill and the Voisey’s Bay nickel mining and smelting complex. He has failed to deliver either . . . but hey folks, it’s not his fault; it’s the fault of those greedy outsiders who want to exploit the province’s resources, just as those other carpetbaggers did in the past. All of these politicians fueled xenophobia and then played on it when they needed to explain why their efforts to “deliver” prosperity failed.

What’s truly sad about Ottawa’s latest I’m-here-to-help scheme is that it sends the wrong message to the people and subverts the efforts of those who are trying to bring about economic self-reliance for Atlantic Canada. Former Premier Frank McKenna of New Brunswick will be remembered for ushering in a new progressive approach. Many Atlantic Canadians know that prosperity can’t be delivered on demand, and they know that the problems of the past were caused by bungling, grand-standing, old-style politicians who promoted their pet projects as the light at the end of the tunnel. Enough already.