Richard Hatfield’s enduring legacy

It’s a classic New Brunswick story – or at least the way we like to tell stories in New Brunswick. Hassan Arif has an op/ed piece in the TJ today talking about Hatfield’s legacy. He starts by ripping the Bricklin project using words like ‘fiasco’ and ‘worst case of corporate welfare’, etc.  Then he launches into a long and flowing soliloquy about all the great things the former Premier did on the social front even going to far as to say he was more liberal than most Liberals.

It’s a touching retrospective on a man I don’t know much about.  Once I had a long talk with a guy who knew Hatfield who said he had a passion for economic development – at least in the early days – and wanted to use cheap power as an industrial attraction tool.

But we don’t hear about that stuff, do we.  It’s all about social development in this province.  The heroic efforts to make societal change while the economy sputters along.

As I have pointed out here, the economic picture in NB relative to the rest of Canada was probably better back then compared to today.  I am sure that would be hotly contested by some but immigration was higher, population growth rates were relatively strong, etc.  Some day if I get some time I’ll look at the spread between education, income and other measures today compared to the 1970s.  I frankly have no idea what that research would reveal.

One thing is for sure.  The Bricklin thing scarred NB in ways we have never really explored. I have said publicly that I appreciated Hatfield’s attempt with Bricklin.  We spend $600 million a year on seasonal EI payments to pay people not to work in New Brunswick and journalists and pundits are going to dredge up the $25 million given to Bricklin 30 years ago?

At least he tried.

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13 Responses to Richard Hatfield’s enduring legacy

  1. mikel says:

    I posted some comments at the CBC thread on the Bricklin play (which still seems like a bizarre thing to provide funding for) and was surprised that the Bricklin ‘fiasco’ isn’t seen that way by a large proportion of commentors and ‘rankers’ at the CBC site (no actual polls have been done). So this COULD be one of those media fabrication things that gets talked over, but the general public holds very different views on. The ‘at least he tried’ theme seems VERY popular there, and people seemed to recall the experience with more nostalgia than animosity.

    The article wasn’t bad though, as far as ‘legacy’ goes we can’t forget the populist views-Hatfield is known to be gay, and there are frequent rumours connecting him to the Kingsclear ‘fiasco’ (which is far more a fiasco than Bricklin ever was). People though forget that there really WAS no such thing as a present day conservative in the seventies/early eighties, that is a recent occurence. There’s a reason they were called PROGRESSIVE conservatives.

    Media tends to have a bias when talking about legacies, even though there was FAR more growth and economic development in the fifties and sixties, the idea is that those were ‘social developments’. Meanwhile, the VERY frugal attempts of McKenna are said to epitomize his reign. He made LOTS of policies along the same lines (got official bilingualism enshrined in the Charter, made substantive changes to health, education, legalized VLT’s, etc), yet his legacy is the ‘business first’ agenda because thats what he promoted the most. It’s far from reality, the province is still dealing with the problems he created, and most of his economic policies are now known to be failures.

    Here’s the comment I left at the Irving site:

    The bricklin deal is only said to be a mistake because it failed, had it succeeded, articles like this wouldn’t exist. ‘We’ spend billions in EI in NB to keep people unemployed, this was an attempt to generate what is now known to be the only job creation industry in the manufacturing sector.
    Here’s a scenario-$23 million to a company providing good skilled jobs that ‘may’ fail. Or, help build a LNG terminal by offering a tax concession that will cost the province over a hundred million. The Maine LNG plant guarantees $8 million per year, while Irving’s tax is capped at $500,000 over 25 years. You do the math. This in an age where gas companies are desperate to find any location, which means the province could have auctioned it to the highest bidder. So, which REALLY seems like a worse economic development move?

  2. Anonymous says:

    Want to post the truth? Hatfield made sure every breathing NBer was drawing EI, either by sending people to stand around Dept of public works for the needed weeks or supporting the buying of stamps. EI money at that time , came from federal coffers. Simple eh?
    And thats the facts!

  3. Anonymous says:

    This rapidly turns into a ‘picking winners’ debate but the reality is the government is expected to ‘not pick losers’. This is easily accomplished by picking no one which, as you suggest, is not a valid option given our economic circumstances.

    However, one would think that some effective mechanism to vet opportunities could be established. Guess this is part of the attraction with NSBI who are somewhat arm’s length from the politics of such decisions.

  4. richard says:

    “The Maine LNG plant guarantees $8 million per year, while Irving’s tax is capped at $500,000 over 25 years. You do the math. ”

    On the other hand, the Irving plant is up and running; the Maine plant is still in the planning stages.

    I’d say Hatfield’s legacy is more on the social end of things. He solidified LJR’s bilingualism initiatives; in doing so, he helped create a revived PC party in francophone NB. Bricklin was a failure, yes, but it was hardly unique in that regard. If that led to a reluctance to male such investments in ‘new’ industries then that is a steep price to pay. On the other hand, investing money in getting an existing car manufacturer to set up here might have been money better spent.

  5. Rob says:

    “The Maine LNG plant guarantees $8 million per year, while Irving’s tax is capped at $500,000 over 25 years. You do the math. ”

    On the other hand, the Irving plant is up and running; the Maine plant is still in the planning stages.

    Do you really think that is due to tax policy, or do you think it has something to do w/ the regulatory process in Maine? Maine even had local referenda to decide whether to even allow LNG development in the first place.

    In Saint John, government told local residents to accept LNG, with a sweetheart tax deal, and by the way, we’re going to plow the gas line through a local park.

    So Maine citizens get to vote on the existance of a project, while Saint Johners watch the excavators line up at Rockwood Park.

    On Hatfield, he once said that once NB built Point Lepreau, no one in the province would ever need to pay for heat.

  6. richard says:

    “Do you really think that is due to tax policy, or do you think it has something to do w/ the regulatory process in Maine? ”

    Its due in part to regulatory policy; in the US local govs have a lot more say in what happens. My point is that the LNG plants will probably never happen, so the tax benefits are likely not relevant.

  7. Rob says:

    Its due in part to regulatory policy; in the US local govs have a lot more say in what happens. My point is that the LNG plants will probably never happen, so the tax benefits are likely not relevant.

    I think the tax benefits are hugely relevant, as we have no idea how much money Saint John and NB left on the table. Every day, the Telegraph-Journal blasts the City of Saint John for being in a deficit position, and for poor management. At the same time, the Canaport LNG plant will pay no more than $20,000/year averaged out over 25 years. How much better off would the City be had they negotiated a better deal?

    Richard Hatfield regularly gets killed in the media for the Bricklin (a loss of $23 million 1970s dollars). Why don’t we call our own leadership on the LNG, potash, and similar deals where we’re signing away the farm for pennies on the dollar?

  8. John Doe says:

    23M 1970 dollars are actually worth 130.4M in today’s dollars, so it was a pretty tough pill to swallow. I do, however, agree that the government is being far too generous with the potash situation.

  9. mikel says:

    Actually, a stricter regulatory process is a GOOD thing for the obvious reasons, but also for economic reasons since it employs a huge number of people and because the LNG company will be paying for that. They have invested over 16 million in the local economy and nothing has even happened. It’s true that in this case Richard may be right, since the passamaquoddy reservation has terminated the contract, however, that’s not really the point. In fact, the passamaquoddies have already benefitted GREATLY by doing absolutely nothing-they have recieved over $200,000 in payments for the four years that no construction occurred. Now THOSE are some smart businesspeople, lets see Graham top THAT!

    There are over two dozen LNG projects in the US, and they are all aware of the regulatory process well in advance. As I posted before, the attempt to build one in Levis was even MORE generous, as most areas are unwilling to host one. We won’t even get into the democratic issues of whether people have the inherent right to choose the type of economic development that is ‘forced’ on them.

    On the canadian side, having the LNG terminal up and running (six months late by the way) is actually a BAD thing, because the most labour intensive part is now over. Irving themselves stated that it can run with as few as EIGHT people. So as an economic engine it is now essentially finished. Half a million to the city is really a drop in the bucket, it would be better to invest that in insurance because if anything goes wrong there is a HUGE cost, and Irving isn’t exactly known for willingly cleaning up their own messes if they can find a way out of it.

    While natural gas royalties will amount to something, we should also note they are ‘capped’, somethign that Lord was at least occasionally publicly complaining about. However, Graham is mum on the subject and even strangely combined gas royalties with other resource royalties in the budget so that its financial benefit is hidden.

    So this all goes back to the ‘balls’ that a government has. An LNG terminal is a huge boon, and NB has a the most valuable resource-an ocean and a dock. Virtually NO municipality has willingly agreed to a terminal (mostly because its known they provide few jobs). So this is even BETTER than having oil, you have a prime piece of real estate that is highly desirable by virtually ANY gas company-imagine how happy that Oklahoma millionaire would have been to put his terminal in St. John and avoid all the headaches and profit sharing. So this goes against Richard’s argument-we have a case where NB has something extremely valuable yet gives it away for even cheaper than most third world countries would. That shows that simply having a resource doesn’t make a politician more or less likely to drive a hard bargain. If you recall, BOTH parties tripped over one another to provide Irving with more benefits, the liberals wanted the entire province to chip in money but were the opposition at the time.

    So the evidence is simply overwhelming, from forestry to potash to minerals to gas and oil, the province simply hands over resources as willingly as possible, leaving no opportunities for value added projects. There are two possibilities for that, they are simply BAD businesspeople, are they are simply puppets of the large industry players, or both. HAVING resources doesn’t change those two facts, and having more resources doesn’t mean there would be any change in the provinces fortunes.

    As for EI, again, that was a different time. However, there is no evidence that Hatfield tried to get every person on EI, though the government was more proactive in industry. To me that’s a GOOD thing, again, IF decent ED were there, EI wouldn’t be essential.

  10. John Doe says:

    Anonymous :
    http://miramichileader.canadaeast.com/front/article/748587

    The difference is that Atcon has a ton of assets to liquidate before the province is ever on the hook for any of the money. That was the purpose of the due diligence inquiries, and I’m assuming that they revealed that the company had adequate assets to cover the loan amount

  11. Anonymous says:

    The NB government, in fact, hired people for the number of weeks needed for UI and then laid them off, hiring new workers, who had no income or UI. In fact, every NB government used it, and will continue, as is evident where Ontario is trying to bring back the UI of the pre Doug Young years! Obvious to most of us, that UI greatly benefits a Province that has a lack of jobs. It was the number one job of the MLA in your area. Probably still is. And, if not, will certainly be in the future or starve. I still insist, and always will insist, there is nothing wrong with facing the facts, regardless!
    Every individual, or Business in Canada is subsidized, one way or another. Different time!! lol

  12. Anonymous says:

    We will see!

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