Sunday, November 30, 2008

Another Plug for Bob Rae as Liberal Leader

Many Liberal partisans dislike him because he is a former NDP leader. Many New Democrats dislike him for the same reason. But I happen to think that at this particular juncture, he is the most qualified person to be the next Leader of the Opposition--or, if it turns out that way, the best person to lead a Liberal-NDP coalition government. With most erstwhile Dion and Kennedy people falling behind Ignatieff like the good "True Grits" they are, it is indeed more likely than not that Micheal Ignatieff will be the next Liberal chief. But I have been more impressed by the particular combination of character, intellect, as well as political skill, of Bob Rae. I relished the prospect in 2006 of him skewering Emerson and Harper over Softwood Lumber and besting Harper in political and parliamentary debate. I liked the idea of somebody finally committing to a national plan for drugs and (eventually) home care. I liked the idea of someone with Rae's qualities having governed the nation's largest province under the most difficult of circumstances, and then going on to be prime minister--something that never happens in our country, which punishes such "baggage". And I also liked the story of the Comeback Kid, which apparently has greater resonance in America than it does here in Canada. And if the Harper government government is defeated in the first sitting of the new Parliament, it would make sense for Stephane Dion to take over the reins as prime minister until the Liberals have their leadership convention in May. And, for that coalition to persist, it would probably make the most sense to have Bob Rae as the new leader.

---A Decima Survey in released November 18, 2006 showed that 37 per cent of respondents said they would vote Liberal or consider doing so if Mr. Rae were the leader, compared with 34 per cent for St├ęphane Dion, 33 per cent for front-runner Michael Ignatieff and 31 per cent for Gerard Kennedy. Mr. Rae appeared to have pulled even among Ontarians, who had apparently forgotten or forgiven his rocky tenure as an NDP premier in the province. Will all of those left-leaning voters who liked Kennedy and Dion actually vote now for Ignatieff?

---The battle-ready former NDP premier of Ontario was feared by Conservatives as someone who already had experience bringing down Conservative minority governments. Conservative Senator Hugh Segal, The Order of Canada recipent, chief of staff to Progressive Conservative Prime Minister Brian Mulroney, and former President of The Institute for Research on Public Policy, had this to say on CBC Radio after the Convention: “My feeling, and the feeling of most Conservatives, was that we dodged a bullet when the Liberals failed to choose Bob Rae as their leader”

--- My former boss in the Ontario Ministry of Labour, Tim Armstrong, was a Deputy Minister under 4 Ontario premiers from 3 different parties. Uniquely qualified to compare and assess their leadership qualities in context, he had this to say(I reproduce the article in full) :


Political mythmaking, Ontario style

The drumbeat theme of those opposing Bob Rae's Liberal leadership candidacy is, "A smart guy, with a terrible record as premier of Ontario." It's difficult to fathom whether this myth is the product of ignorance, malice, or both.

I was appointed as a Deputy Minister by Premier Davis and served under him and his three successors, Premiers Peterson, Miller and Rae. None of those premiers would claim to have achieved perfection. But the suggestion that the Rae government did not live up to -- and in some areas exceed -- the standards and accomplishments of its predecessors on behalf of the people of Ontario is untrue.

When Bob Rae assumed office, the province was faced with an economic crisis -- a deepening recession, unprecedented competitive challenges from a Free Trade Agreement with the U.S., high interest rates, an overvalued dollar and a budget deficit of several billion dollars rather than the surplus predicted by the prior administration. Over 300,000 manufacturing jobs were lost between 1989 and 1992.

When the Rae government approached the end of its term, Ontario led the way in growth among the provinces and had one of the strongest economies in the G7. Surveys showed strong consumer and business confidence.

Private sector investment was back with billions in capital spending. Labour productivity was at an all-time high, as were manufacturing exports. Health-care costs were under much improved control as part of a broader strategy that was reducing the deficit.

My most memorable work with Premier Rae involved the restructuring of Algoma Steel in Sault Ste. Marie and Dehavilland Aircraft in Downsview. From the outset, the premier made it clear that he was determined, in the interests of the employees, the affected communities, and the provincial economy, that both companies would survive. His personal efforts in achieving success exceeded, in dedication, intelligence and shrewd negotiating skills, anything that I had previously experienced.

The costs incurred by Ontario in these restructurings, as well as those extracted from the federal government, have been recovered, many times over, in tax revenues alone. And the dismal alternatives to success -- weeds in the companies' parking lots, padlocks on their gates, and thousands of discouraged unemployed workers, their families on welfare or seeking social assistance -- were all avoided. These achievements were repeated, at Spruce Falls Pulp & Paper in Kapuskasing and other communities across the province, under the Manufacturing Recovery Program, a program designed and implemented with the full involvement of the Premier.

Bob Rae was, from the outset, under attack from many in the business community. After taking office, he faced vigorous opposition from organized labour, principally for his efforts to curtail what he perceived to be excessive wage demands and his commitment to share the necessary cuts in government spending fairly. In my experience in the labour relations field, if you displease both labour and management, you are likely on the right path.

There were other noteworthy achievements during this time. The Rae government successfully promoted the Jobs Ontario program, with increased investment in child care and training; incentives to employers to hire people on welfare and those whose employment insurance had run out; the elimination of payroll taxes on any new employee hired -- policies that, combined, created in excess of 50,000 jobs.

Ontario's welfare system was renewed, focusing on the needs of children living in poverty; the child-care budget was expanded; hundreds of thousands of poor families were removed from income tax rolls; and the new Trillium Drug Plan gave affordable access to all in need of therapeutic drugs.

The Rae government placed a renewed emphasis on aboriginal affairs, leading to the first Statement of Political Relationship between a provincial government and aboriginal leadership, acknowledging the need for government-to-government relations and providing new funding to address native poverty, with emphasis on housing, child care and improved sewer and water facilities.

Finally, as premier, Bob Rae held a deep commitment to the success of our federal system, and in particular, one that would accommodate Quebec's goals and aspirations, without jeopardizing Canadian national unity. He played a leadership role with the First Ministers that produced an affirmative vote in Ontario on the national referendum on the Charlottetown Accord.

Many other reforms were set in motion, many of which have been continued by successive governments. As to the Liberal leadership race, may the best candidate win. But in the process, the trumped-up myth that Bob Rae presided over an ineffective government needs to be put to rest.

Tim Armstrong was Ontario's Deputy Minister of Labour and Deputy Minister of Industry, Trade and Technology and was the province's Agent General for the Asia- Pacific region, 1986-1990.

Source: The Hamilton Spectator
Monday, August 14, 2006
by Tim Armstrong
Page A15

Sunday, November 16, 2008

What Should an Auto Company Bailout Look Like?

In exchange for government aid, the Big Three's creditors, shareholders, and executives should be required to accept losses as large as they'd endure under Bankruptcy protection, and the CAW should agree to some across-the-board wage and benefit cuts. The resulting savings, combined with the bailout, should be enough to allow the Big Three to shift production to more fuel efficient cars while keeping almost all its current workforce employed. Ideally, major parts suppliers would adhere to the same conditions. What must be avoided is a re-run of the U.S. Chrysler bail-out of the 1980s--when that company took a big chunk of public money and then turned around and laid off 1/3 of its workforce.

In exchange for job security, trade unions should agree to wages-plus-benefits that are closer to what North American workers for Toyota, Honda, and Nissan make--e.g. @$50 per hour instead of the $67 per hour that Big Three workers currently make.

That's tough medicine, but reasonable from this taxpayer's point of view.

Friday, November 14, 2008

What Price Budget-Balancing? Note the P3 Dimension

{The federal government is on record as saying 'the time for study is over, this is the time for action' when it comes to Public-Private Partnerships (P3s). Yet a great deal of the research that has been done is ambivalent about the value of P3s, which often trade off public sector accountability and long-term economic benefits for the sake of short-term improvements to government financial accounts. Now that the federal government is under pressure to take steps to avoid a budget deficit, that ideological and political commitment to P3s is about to become as strong federally under Harper as it has provincially under Campbell. Keep your eyes peeled for dodgy deals designed to conceal true long-term costs from Canadian citizens. Here are some apposite remarks from Professor John Loxley, from his 2008 CAUT Distinguished Academic Award Acceptance Address:---MC}

"As the Council of CAUT is aware, the decision by the administration at my university to award a five year contract to Navitas, through the International College of Manitoba, to recruit and teach overseas university students at pre-university and university 1 course level has been controversial for a number of reasons. The contract did not go through either the Board of Governors or the Senate. There appears to be no provision for academic oversight of courses, teachers or standards by the Senate, and the details of this forprofit agreement are confidential. Clearly, this would not make the ICM a model for accommodating pre-entry needs of Aboriginal students. But the Navitas/University of Manitoba agreement is interesting to me for other reasons. It is an example of a public-private partnership (PPP) and for the past decade or so I have been studying the theory and applicability of PPPs in Canada and around the world.

Declaring that ‘The time for study is over; this is the time for action’, the federal government recently made it a prerequisite of it signing infrastructure
co-financing agreements with provinces that they consider PPP arrangements for all large infrastructure projects. Yet serious academic studies of PPP experience suggest that they uniformly cost more than public sector alternatives, rarely provide value for money, do not necessarily shift risk to the private sector as they are supposed to do, and do not reduce effective government debt as they often promise. In the light of this, the Navitas agreement raises many unanswered uestions. For instance, was a public sector alternative to Navitas ever considered or costed out by the University of Manitoba? Is this a way of undermining the collective agreements which protect those who teach first year courses? How much is Navitas paying the University for using its premises? What safeguards are in the agreement to maintain academic standards and appropriate academic behaviour? Without public access to the legal agreement, it is not possible to answer these questions. But that is not unusual in PPP agreements as access to information is frequently barred by reference to the need for commercial secrecy. This secrecy is rarely justified when public money is being spent and, in a University setting is deeply disturbing. I commend CAUT for its efforts to address our concerns over Navitas and I raise the matter here because, regardless of what the federal government might claim, the academic debate about the wisdom of PPPs is far from over.

What drives administrators to enter into questionable arrangements with the private sector are real or perceived budgetary problems. I have always seen budgets not as mere financial statements, but as profoundly ideological and political statements. To paraphrase Julius Nyerere who was speaking about planning, ‘to budget is to choose’. A critical examination of budgets involves, therefore, a critical examination of political choices made and put to numbers. My involvement in helping develop alternative budgets in Canada in the 1990s arose out of widespread dissatisfaction with budgetary choices being made at the federal and provincial levels, in particular. Those choices had a profound impact on people and institutions on the ground, and universities were not exempt from this. While there is a perfectly legitimate justification for simply critiquing budget choices, developing an alternative budget helps put those critiques into a more disciplined, constructive framework, thus helping to head off the counter claim that the demands being made are unrealistic, unmanageable or fiscally irresponsible. This is, of course, highly political and contentious work since it involves challenging the political power behind the budgets, be it the federal government, the provincial government or the university administration. It helps, enormously, to have the protection of tenure, academic freedom and a strong collective agreement. Working from an academic base also makes it easier to work, collegially, with civil society
organizations; women’s groups, environmental groups, trade unions and anti-poverty groups, as one is perceived, rightly or wrongly, to have a high degree of independence and impartiality.

Linking my work on PPPs and on budgets, leads me to caution against universities building closer links to the private sector for budgetary reasons. The budgetary impact of PPPs is often quite negative as governments replace direct borrowing by paying for leases on assets purchased by the private sector at higher interest costs."
---John Loxley, FRSC