Some Day the Sun Will Shine and Have Not Will Be No More (21 page)
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Authors: Brian Peckford
“And while I must deal with today
I must worry about tomorrow because I don’t want it to be like
yesterday.”
— Premier Brian Peckford, October 26, 1982
I WAS EAGER TO
clearly outline the administration’s vision and
focus. I had come to realize that with the pending constitutional talks
approaching, our position should be made very clear. So the first Throne Speech
said the following:
Forty-five years ago, our people faced the greatest crisis in their
history. The suspension of Dominion status, an economic and political crisis
that cost them their hard-won democratic institutions and control over their
social and economic destiny.
Since then we have gone through a period of social and economic
reconstruction and development which has seen a Commission of Government for
fifteen years, our entrance into Confederation, and a thirty-year
post-Confederation development period. Throughout the whole, the
determination of the Newfoundland people to control their social and
economic destiny has not wavered. The debate has only been about the
appropriate means by which the great overriding objective is to be achieved.
While it is clear that our entry into Confederation cannot be questioned,
there is a growing realization that the present structure of Confederation
does not allow
this province to realize the full economic
benefits of its own resources or to adequately promote the enhancement of
our unique cultural heritage.
The speech went on to say:
My government feels that we must go through a final but necessary stage of
reconstruction. Our people are, I am sure, ready, yes, even anxious to
complete the task of securing for themselves the means by which they, as a
people, can assure their future as a distinct society. This objective can
only be achieved if we, once again, have adequate control over our marine
resources: fisheries and offshore oil and gas. If we are to move forward
there must be constitutional change . . . My government will make strenuous
efforts to renegotiate certain arrangements already in place, in particular
the power contract at the Upper Churchill . . .
And the final quote I will reference from that Throne Speech:
A detailed five-year plan will be presented to the federal government
before the end of this calendar year, which will serve as a basis for a
complete rationalization (in the medium term) of the financial relationships
between the Government of Canada and the Government of Newfoundland and
Labrador.
I am going through some pains to quote this first Throne Speech since it marks
the beginning of my time as first minister of the province, but also more
particularly as it highlights the three main thrusts that I pursued, ones I
thought were the most necessary for the future: first, fish, because of its
historic roots and also because of the labour and demographic dimensions of the
issue; second, the Upper
and Lower Churchill Falls, both to
try and correct the wrongs of the Upper Churchill contract—which if changed to
current economics would, in one fell swoop, make us a “have” province—and to
develop the Lower Churchill for future energy needs; and third, offshore oil and
gas, the new frontier where we could start from the ground floor and try to
reverse the resource giveaways of the past, including fish through the Terms of
Union, Upper Churchill Falls through the Upper Churchill contract, forest
concessions in both the Corner Brook and Grand Falls original deals, mineral
concessions to John Doyle, and railway concessions to the Reid family and the
Come By Chance refinery bankruptcy.
Now, it is likely forgotten just how poor we still were even thirty years after
Confederation and how necessary the changes, as outlined in that speech, really
were. I am unsure whether at the time the people really appreciated this
circumstance. Of course, after a while negative overload kicks in, and in order
to cope people must get on with managing their own lives as best they can.
The speech talked about a detailed five-year plan. It was completed and made
public in October, 1980, and was called “Managing All Our Resources.” As part of
that, comparative economic indicators highlighted our very weak position:
GDP per capita was $5,951; the Canadian average was $11,317.
Average family income was $18,326; the Canadian average was
$24,816.Earned income per capita was $4,228; for Canada it was
$7,798.The number of people employed as a percentage of the adult
population was 44.5%; the Canadian average was 58.6%.The unemployment rate was 15.4%; the Canadian average was
7.5%.Liquor taxes brought in as much money as
corporate taxes.And tobacco taxes brought in more money than all mining taxes and
royalties.
If you used 100 as Newfoundland’s earned income, the next province would be
Prince Edward Island at 114, 14% more; Saskatchewan at 71% more; Alberta and
British Columbia were both over 200; and the Canadian average was 185—85% more.
It is necessary to quote the document:
If Newfoundland is to become a full and equal partner in Confederation, it
must overcome its dependence on transfer payments and the only way to do
that is to generate real wealth within the province. To create wealth
Newfoundland must have the same degree of control over its resources as the
other provinces already have over theirs. It must always be stressed that
Newfoundland is not asking for anything special, but merely the recognition
that it has equal rights with other provinces. If the federal government
controlled resources in other provinces, our stance might be considered
unreasonable, but such is not the case. Newfoundland lacks control because
its resources happen to be in the ocean, under the ocean, or in rivers in
Labrador, and are somehow perceived to be different.
It goes on to say:
In order to understand Newfoundland’s need to control its resources, it is
useful to examine the relative position of Newfoundland and the rest of
Canada with respect to earned incomes, which is the real indicator of
wealth. Newfoundland ranks
a dismal last in Canada, and
although the gap has closed slightly in the last twenty years, the average
earned income in Canada is still 85% greater than in Newfoundland.
Therefore, just to reach the national average, earned incomes in
Newfoundland would have to almost double to catch Ontario; to catch BC and
Alberta they would have to more than double. In fact, the reality is even
more onerous than this because the other provinces are growing at the same
time. For example, if Ontario, Alberta, and BC grow at 3% per year in real
terms over the next twenty years, then Newfoundland would have to grow 6.6%
per year to catch them by the year 2000. This would be an almost four-fold
increase in real earned incomes in twenty years to get up to the national
average.
The budget of 1982 gives some sense of the enormity of the problem.
Expenditures were $336,445,000 less than revenues on a total budget of
$1.7 billion.
The budget records a 2% point rise on Personal Income Tax; Corporate Income Tax
increased on large corporations from 10% to 16%; and interest on loans to
fishermen, farmers, and small businesses increased from 8% to 12%. Additionally,
wage restraint was announced for those receiving compensation from the province,
and over the years that went from a 5% cap to 5%, 4%, and 3% (highest, middle,
lowest-paid employees) to 3%, 2%, and 1%, and finally to no increase for two
years.
The dependency on Ottawa was such that 48.8% of our revenues ($841,216,000 of
which over $500,000,000 was equalization) came from the federal government and
that debt payments were the third largest expenditure, ahead of social service
expenditures.
It was obvious to me, my Cabinet colleagues, and our senior public servants
that the present arrangements within the country, as it related to our province,
could not see our province reach national
average earned
incomes. Even if everything went perfectly in our fishing, forestry, mining,
agricultural, and tourism industries, we could not possibly earn sufficient
revenue to attain anywhere near levels of income to approach the national
average or attain “have” status.
This was the stark reality! There were some of society’s leaders who never
accepted this—labour leaders, fishing industry leaders, other business leaders,
and politicians (municipal, provincial, and federal). There were some who more
or less accepted this reality and saw the best way was just to abandon this
“highfalutin notion” (some called me a rural romantic and others thought I grew
up sporting a massive chip on the shoulder) of somehow reaching “have” status
and just “accept what you cannot change,” within the Confederation.
Our condition also manifested itself in other ways. For example, during my
first election as leader of the PC Party, the nurses were on strike, and my last
election the teachers were on strike. There just wasn’t enough money to provide
reasonable remuneration to these large groups who were paid out of the
provincial treasury. Interestingly, I won both elections. Sometimes the crowd
has a better sense than the elites of what can reasonably be done. Similarly,
during the first election, a generous drug program was proposed by the Liberal
Party but gained little traction. Once again the wisdom of the populace seemed
to be there when the leadership of the province seemed too content to fight
their little parochial battles.
Yet the Opposition was strong and influential in attacking and opposing the
larger agenda of fish, Churchill power, and offshore resources.
On the fish matter, the Fishermen’s Union never came onside and many fish
companies remained ambiguous given that they were beholden to the federal
government regarding quotas. Early on, the union was led by a former Liberal MP
who unfortunately, at that time, took the interest of the union ahead of the
province, although he possessed the ability to show leadership and take the
larger view. I think he later regretted that stance. And even with the inherent
conflict of interest—that is, trying to represent the offshore fishery, the
inshore
fishery, and the fish plant workers—the union was
nevertheless a formidable force and had many friends in the federal bureaucracy.
Unfortunately, there was little leadership within the fishing industry or the
business community or in the populace at large to expose this conflict for what
it was.
As it relates to the Churchill power situation, there was great public support,
but among the elites there was simmering skepticism, and many in the business
community were more interested in seeing the Lower Churchill projects of Gull
Island and Muskrat Falls proceed, rather than protracted talks and court actions
related to trying to change the infamous Upper Churchill contract, even though
Quebec was earning more than $500 million per year from it.
The offshore was brand new, without existing constitutional impediments or
unfair entrenched contracts. But from the start it was a battle royal and many
voices inside and outside the province opposed our approach.
But the course was set, and from 1979 on we were determined to pursue those
three actions with relentless argument and passion. That was the plan, our
vision, our raison d’être on which we would never surrender.
In a speech to our annual meeting of the Progressive Conservative Party of
Newfoundland on November 5, 1983, I exclaimed:
We hold in trust the welfare of generations unborn to chart a course with
the proper and prudent development of our resources so that we shall reach
equality with other Canadians within this confederation.
Let us step forward nurtured by the belief in Lin Jackson’s words: “We must
develop a new, bolder self-respect—a renewed self-confidence in ourselves
and in our ability, not simply to survive (as it always was), but to take
our situation in hand and become masters of it.”
In so doing, we will be able to exclaim from the
mountaintops— “One day the sun will shine and have not will be no
more.”
However, we were only too painfully aware of the moment, brought home every day
with either people protesting, striking, or petitions and representations from
all over the province for basic services that were taken for granted in the
other provinces of the country.
I remember well the agonizing meetings and arguments and trade-offs in trying
to come close to balancing the budget (that is, just the operating budget). The
capital budget would all have to be borrowed. That was the brutal reality of
having a credit rating, the lowest in Canada, of Baa1.
By the time we had taken care of the health and safety priorities of our
municipal capital budget (over 90% of the municipalities could not finance their
own capital projects), there was little left to begin new ones. The roofs on our
trade schools were leaking and we would have to prioritize the worst ones and
let the rest get stopgap repairs and hold out for another year or more for
permanent repairs. Basic health services were well below the national average,
and trying to implement some drug coverage while not balancing the budget was a
challenge.
I remember suggestions (well-intentioned) from within government to look at our
parks and Newfoundland Hydro for changes to get savings (privatize?), and after
having such suggestions arise for a second year in a row, I blew my top and
exclaimed: “Water and parks are off limits regardless of how bad it is or
gets.”