Grab bag of issues this a.m: NDP, high income & shale gas reports

There are a few points I want to address this morning based on conversations over the past week.

The first is on the elect-ability of the NDP.  I was having a conversation with a colleague who is a devout NDPer about the Broadbent Mulcair feud this week.    In my opinion, when the NDP adopts a more ‘centrist’ approach, that is when they can get elected.  Darrell Dexter in Nova Scotia is an NDP – he raised taxes, implemented labour friendly policies and expanded specific social programs.  Some folks are furious with him as evidenced by the editorial pages of the Chronicle-Herald.  Yet, he has for the most part been a sober, centrist leader with a strong focus on economic development and making a more efficient government.  They are pragmatic about natural resources development – a senior person in the government told me they are glad to be a “couple of years behind New Brunswick” when it comes to shale gas development but they are moving ahead to develop that resource as well as other mining – and a big push for more offshore oil and gas exploration.

In New Brunswick, the NDP – my aforementioned colleague partially agrees – is comfortable as the conscience of the left with no real ambition to form government.    If they elected someone like Dexter as a leader, they could be in power – IMO – within one or two election cycles.     As a permanent, marginal leftist party they can take hard stances on BNB (scrap all incentives), taxes (raise ’em on the high income earners), environment (no to anything that involves digging holes or cutting trees), etc.    In my opinion, a healthy democracy features parties that cater to a broad spectrum of views but in our system – you can’t form a majority government – like the NDP has now in four? five? provinces – if you sit out on the fringe.  Now, my friend tells me that he thinks the public in New Brunswick is more left leaning than I give them credit for and they will embrace most of the platform although he doesn’t believe the party will form government any time soon.

While it’s not a good segue, I will address the number of shale gas reports/stories that people are sending me.  I get a couple a week referencing potential environmental problems with shale gas and a couple talking up the economic benefits and lack of environmental concerns.  I am not qualified to arbitrate this issue in any way – others posting to this blog have much more direct experience – so I appreciate the links but I likely won’t comment that much on specific reports/studies unless there is something new.

Suffice it to say there are concerns but right now they are more hunches than hard data.  Certainly there are the traditional environmental risks associated with any nat gas development such as leaks but the broader concerns about water contamination, localized earthquakes, etc. are hotly debated and will likely be well into the future.

Finally, I saw an interesting statistic this week that I thought I would pass on to you.  While New Brunswick still has far fewer high income earners (no matter how you define that), we did see a spike in the number of people reporting $100,000 or more in total income between 2006 and 2009 (the most current time frame for available data from Stats Can).  I thought this was mildly interesting.  The trend actually holds going back to 2000.  New Brunswick has seen a faster rise in the number of folks earning $100k or more in that nine year window even though the economy has been quite weak through the period.  Median income is up 43 percent in NB versus 34 percent across the country.   I don’t want to speculate on what is driving this growth but I might look into it deeper in the weeks ahead.  Certainly a tightening labour market drives up wages as a general rule and the recession didn’t hit here as hard as a place like Ontario but there could be other things going on as well.

Increase in the number of high income earners (% change 2006-2009)

Canada New Brunswick
Persons with income of $100,000 and over +28% +51%
Persons with income of $150,000 and over +22% +37%
Persons with income of $200,000 and over +13% +24%

Source: Statistics Canada.

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13 Responses to Grab bag of issues this a.m: NDP, high income & shale gas reports

  1. I hear this ‘pragmatist centrist’ argument a lot, and though I don’t speak for the NDP, I am a member, have been for decades, and have been around this block before.

    First, on the ambitions of the NB New Democrats, I’m sure Dominic Cardy can represent the view well, but I would say that the intent is to form a government, not to remain a ‘conscience of the government’.

    It would be, though, a government with a conscience, which would be a nice change.

    The thing about being in the centre is, it depends on where the edges are. The right wing has had a lot of success shifting the centre right by catering to the extreme fringe – the Reformers in Canada, the Tea Party in the U.S.

    Another thing about the centre is, it’s where most of the people are, so if you can move the people, you can move the centre.

    I am in the camp of ‘moving the people’. I think that if we can break through media monopolies and the politics of influence and money, we can see an era where people support governments that serve their own interests, rather than those of people with power and money.

    I think the centre is moving, and demonstrably moving, not because the NDP suddenly became more right wing (ol’ jack would roll in his grave) but because people are beginning to realize that their interests are not being served by the Liberals or Tories.

    One way the NDP does *not* become ‘electable’ is by selling out its constituents and its principles. None of the leaders (and none of the leadership candidates) is running on a platform of abandoning core NDP values – and it is a (typical) misrepresentation of the leadership debate to suggest it is.

    For myself, and for what it’s worth, I am supporting Mulcair – not because he is ‘pragmatic’ but because he is smart, speaks well, is fluently bilingual, and believes in social justice. I’m sure Topp is very good, but I found him stilted and wooden, with poor French (not ‘radical’ or whatever you would like to term it.

    But whatever. Any of the candidates would be far preferable to what we have seen in the PMO in the past. Because what was one ‘fringe’ is now ‘the opposition’ and stands a decent chance of being the government – all without adopting ‘new labour’ policies of appeasement.

  2. Dear David,

    I just read your blog post and thought I’d comment. Stephen Downes does a great job of describing why I am joining him in supporting Thomas Mulcair and leads into provincial politics very nicely with his line about me wanting to lead a government with a conscience.

    My goal is to lead the New Democrats to government. To quote Neil Kinnock: “We know that power without principles is ruthless, sour, empty, vicious. We also know that principle without power is idle sterility.” I spent many years working in international politics and I want to put the lessons I learned to work for my province. The first step is turning the New Democrats into a party ready for government. But the goal after that is to win the election.

    The New Democrats needed to change in New Brunswick, and we have. The party is growing and reaching out to former Liberals and Conservatives. Despite not having held a seat in the Legislature since 2005 we are now consistently within reach of the Liberals in public opinion polls.

    New Democrats have changed their approach. We don’t lecture people and we don’t assume we have all the answers. I became leader without owing favours to any group, and I make it clear to my fellow members that we will always make decisions that put the best interests of the entire province first.

    Instead of looking to control the private sector we want to let businesses make money, so their profits support a strong province. We want a tax rate that is high enough to support the programs the public supports, but no higher, and I expect the public sector to be lean and efficient.

    Spending tax dollars is a sacred trust that has been abused by New Brunswick’s governments and some businesses over the years. They took cash from struggling tax payers to pay for their latest pet project or sweetheart deal, leaving us a have-not province with looming economic, social, and demographic crises. Ending corporate welfare isn’t an idle policy dreamed up for opposition, it’s a new way to run our province more radical than anything since the Robichaud/Hatfield era.

    New Democrats are progressive: we want development, we want growth, and we want it as soon as possible. We also want prosperity to be sustainable, to be shared by as many New Brunswickers as possible, and we don’t think governments have done the right thing to achieve that goal. Governments need to focus on literacy and essential skills, health care, energy, and infrastructure. Let’s get the basics right.

    You took a swipe at our energy policy. I started out expecting to support shale gas development. What turned me against it was a combination of research showing the inherent risks, the weakness of our current enforcement regime, and my lack of confidence in the government’s ability to ensure shale gas earned our province enough money to make the other risks worthwhile. Shale gas companies have given fracking the bad name it currently enjoys; my experience being threatened with a lawsuit by the CEO of Windsor Energy hasn’t softened my position on this file.

    So, thanks for the column but I hope when you write about the New Democrats again that you will do more research. We have a lot online and in the press – check out our website and Facebook page where you can find press releases, media coverage and so on. I would welcome the chance to talk with you about the party in New Brunswick and why we are leading the fight to really change our province. You can reach me at 506-238-5550 or at [email protected].

    Best wishes,

    Dominic

  3. Dominic, I wish you well. I think New Brunswick would benefit from a strong third political party. As I say in the piece, there are now multiple examples of the NDP forming government across Canada. As for the NDP/Liberal party position on shale gas, we will have to respectfully disagree with each other.

  4. [email protected] says:

    The OPPOSITE of this view is what is ‘true’, if by true you mean ‘fits the facts’. In Nova Scotia the NDP was elected by an influx and interest of younger voters, the party admitted this themselves. In NB the Alward government is running the NDP platform from the last election. The NDP was the ONLY party talking about ‘fiscal responsibility’ (and this from a Priest!) If ANYBODY was ‘left’ during the last campaign it was the PC’s and Liberals (funny how that works isn’t it).

    The lack of NDP representation has almost ZERO to do with actual policies. If you go point by point you see BY FAR the NDP is ‘the people’s party’. The elephant in the room is the absurd electoral system. IF there were a functional one, then the NDP would have at least 10% of the seats, and this would not only give them the experience of governing, but also would make their members far more ‘public’, which, I can almost virtually guarantee, would make them ‘an option’. If Jesus Christ himself came down and started a third party he’d never get elected-even in the bible belt.

    Add to that the fact that the ONLY private media are so virulently anti-union, plus the constant small party curse-lack of experience, and you can see why people prefer ‘the devil you know’. To use Mr.Campbell as an example, when a guy with a masters degree defines a party as ‘left’ simply because they oppose development with no regulation (even Alward has admitted they do not have the infrastructure for proper regulation, we’re still waiting for those ‘new regulations’), then you can just imagine what a person who has almost zero education thinks-well, we KNOW, we read it all the time on blogs-they are ‘commies’ and ‘socialists’.

    Polls though, are only useful WHEN you have a functional electoral system, so Mr. Cardy’s optimism is pretty rhetorical. Like so many in politics, his success has more to do with who the liberals choose as leader, what issues come up, bonehead moves by Mr. Alward, and the success or failure of the other two ‘fringe’ parties.

    Since Mr. Cardy is reading this then I’ll restate my first point-that in Nova Scotia they got elected by a relatively HUGE influx of young voters. I’ve seen little attempt in NB to even TALK to those people. The NDP facebook page has fewer than 500 ‘likes’, with less than 20 regular visitors. It’s clear the youth of NB are only mildly interested in shale gas, and even less so in the Occupy movement. What they ARE interested in remains a mystery, but it CERTAINLY isn’t ‘centrism’. And for ammunition for the contrary parties, take a look at what happened to the last party leader who was ‘acclaimed’ by their party executive.

  5. Richard Reeleder says:

    “What turned me against it was a combination of research showing the inherent risks….”

    I don’t buy that for a second. The NDP has jumped on a populist bandwagon, once again. An attempt to curry favour with a recalcitrant electorate and nothing more.

    ‘ending corporate welfare’ Another empty phrase. What would the NDP do if the Nackawic mill came calling for support, with the union in tow? Say no? I am very doubtful about that.

    I’d like to see an NDP as ready to govern as the NDP in Nova Scotia. Instead all I see is grandstanding. Perhaps you could start by telling some hard truths: raising corporate and personal income taxes (on the wealthy), and ending ‘corporate welfare’ (whatever that really means), while popular with your fans, will not be enough to get NBs fiscal house in order. Support a 2% hike in the HST in addition to those measures and I will start to pay attention.

  6. mlarchibald@ says:

    Fact is, I doubt Richard OR Mr. Campbell are ever really going to vote NDP. His view of ‘ready to govern’ seems to be ‘agrees with me’. If you call Mr.Cardy a liar then why would you start listening to him if he starts talking about an HST increase? YOUR prescription is an HST increase, so Mr. Cardy would be ‘just pandering’ to a recalcitrant electorate.

    In this Mr. Cardy has the correct ideological standpoint, but the incorrect political one. It is the Irving media which can make or break an election, and IF Mr.Cardy stopped talking about what VOTERS want, then he may get more press and be called ‘ready to govern’. Ready to govern essentially means “ready to do what business wants”.

    However, for voters, even Alwards own online survey showed that FAR more NBers wanted higher corporate taxes and taxes on the wealthy rather than government cuts. Something Higgs then went on to blatantly lie about. From a policy point of view, we simply don’t KNOW how much of a dent it would put in NB’s ‘fiscal house’, but it would certainly do a heck of a lot more than Alward’s first year, which was essentially a series of cutbacks which really had no effect, except to raise NB’s unemployment rate, which probably had a lot to do with hiring freezes.

    The gas debate really is now a political one, in that neither side is even talking about the same thing. One side ASSUMES that gas can never be done safely, the other ASSUMES that the government will get a fair return and have the required regulations in place. NEITHER are true, and both sides now argue the issue like religion.

    As for corporate welfare, the Nackawic mill, REGULARLY comes to the government for bailouts, and no doubt the owners or representatives of that mill show up at a few of Alwards $500 a plate dinners. There isn’t much left of the Nackawic union, so even if they did join the owners in asking for more money, its not like their union has ever helped the NDP much, and workers in Nackawic would probably benefit financially as much from a community forest alotment than they do working at the mill.

    A better example is the Saint John pulp mill which Irving frequently threatens to move to Quebec. I would very much like to see Mr. Cardy state outright that he’d throw all those workers to the wolves rather than grant Irving 10 million. That takes some real cajones, and I’d like to see a politician say THAT.

    Richard talks as if ‘populist’ is a BAD thing. It’s the only thing that wins elections (by definition). Mr. Cardy is hoping to be lucky like Shawn Graham, and hoping some issue like public insurance will take on, which is why he’s got comments on virtually any story that hits the airwaves. There is nothing wrong with that, but it won’t win you an election. Essentially the liberals will sit back and watch you, then wait to see which issues have traction, then they will co-opt them, and they have the nuts and bolts political apparatus to sell them.

    However, this MAY be the right time for the NDP, in that neither main party has any ‘populist’ credibility. Although that hasn’t stopped them before.

  7. Richard Reeleder says:

    “I doubt Richard OR Mr. Campbell are ever really going to vote NDP. ”

    Sorry to disappoint, but I HAVE voted NDP and would be more than happy to vote NDP again. But I will not do it while the NB NDP prefers populist nonsense to real policies. I expect you think that NS Premier Dexter ‘would never vote NDP'; and perhaps you would be right if he was residing in NB.

    “YOUR prescription is an HST increase”

    If you don’t like that prescription (which is not just mine but that of quite a few mainstream economists), provide another that generates enough tax revenue to significantly reduce the deficit. I have already agreed that corporate taxes can be raised back up and that the income tax system needs rejigging to return to progressiveness. After all, even social justice orgs have come out in favor of HST increases, if done the right way.

    “From a policy point of view, we simply don’t KNOW how much of a dent it would put in NB’s ‘fiscal house’”

    We don’t??? I think some quite reliable estimates have been generated on that score. Corporate tax hikes and income tax hikes (on the wealthy) will not be enough to get the fiscal issue under control. And let’s not forget that increases in NB’s expenditures in certain areas are practically built in to the last set of federal budget plans.

    “I would very much like to see Mr. Cardy state outright that he’d throw all those workers to the wolves rather than grant Irving 10 million.”

    But he won’t do that, will he? And a good thing, too, if you have relatives in SJ. The whole ‘corporate welfare’ stuff is just ranting with no real policy behind it. Does ‘corporate welfare’ rule out strategic investments in certain sectors? Does it rule out direct and indirect investments in R&D? Does it exclude aid to a strategic company or sector that has some short-term pain due to a sudden change in market conditions? A libertarian might label all those things ‘corporate welfare’. What exactly is the NDP position here? Or is Cardy waiting for a poll result?

    Yes ‘populist’ is a bad thing. In NB populist rage against change has terrified politicians. What we need are politicians with the balls to tell the populist factions things they don’t want to hear. Cardy is afraid to do that. Since he is at least 2-3 elections away from seriously challenging for the Premier’s Office, he has the time to tell some hard truths.

  8. mlarchibald@ says:

    Suuure Richard, your posts just read like an NDP manifesto! Much of this is academic though and a question of priorities. IF Richard agrees that corporate taxes and taxes on the wealthy should be raised, then advocate that (I’ve certainly never seen him say it). Do that NOW, then talk about tax fairness. All we got from Alward was some efficiencies, which actually ended up saving fairly little.

    The HST example was simply making a point. EVERY person out there has a suggestion and DOESN”T think that politicians taking up on it is ‘pandering’. It’s only ‘pandering’ when they take contrary views to whomever is saying it.

    VERY few social agencies are talking about HST increases, virtually NONE that I’ve ever read. But just to make another suggestion, years ago when McGuinty was first elected the province was also in bad financial shape, the first thing they did was bring in a ‘health premium’. This was essentially a tax by another name, but the cost was related to income, so it WAS ‘progressive’. We ended up paying about $1000 the first year. However, the VERY next year the province had a surplus, and it was largely credited to that new progressive tax.

    Every social organization knows that if you need more money you tax those that have it. The ONLY way a social organization is going to favour an HST increase is IF all the most common household items are exempted. So ‘in the right way’ essentially means ‘as long as all the things we buy are exempt’. Its well known that lower and middle class earners spend far more of their income in ‘purchasing’ things, and an increase in the HST hits them hardest. In a province where welfare payments in most categories is the lowest in the country, I’d be pretty surprised to see a social agency advocating ‘yes, raising taxes for our members is a great idea’. But again, post an example if you have it.

    EVERY group one likes can be called a ‘populist faction’. In fact, we know from polls that in terms of the province, FEWER people want to ban fracking than agree with it. So why isn’t Alward being ‘populist’? Its because Richard happens to agree with that position. Thats the nature of politics. Populism simple means what it says-popular. You’d have to be a crazy politician to say “what a great way to get elected, I’ll tell people what they don’t want to hear”. What Richard is forgetting is that HE ‘wants to hear’ those things. So like I said, IF he disagrees with the NDP, he’s hardly likely to vote for them.

    As for corporate welfare, its good to hear some good NDP comments. But by definition IF you are in favour of handing out money to Irving because it saves jobs, what about all those other thousands of jobs lost? If you will pay Irving X amount to create X jobs, what about EVERY other company? So you can see why many want to avoid the slippery slope. I’m not sure this is the same Richard that used to bemoan the control that Irving and the two or three family companies hold over the economy, but essentially it is that practise that has helped keep them in power.

  9. Richard Reeleder says:

    “IF Richard agrees that corporate taxes and taxes on the wealthy should be raised, then advocate that (I’ve certainly never seen him say it)”

    See above in this post and other posts on this blog. Then retract and apologize Mikel or I will ask David to ban you from posting.

  10. mlarchibald@ says:

    Do whatever you want. Your comment on this thread was “raising corporate and personal income taxes (on the wealthy)….will not be enough to get NBs fiscal house in order”, and “Corporate tax hikes and income tax hikes (on the wealthy) will not be enough to get the fiscal issue under control.” If you have other comments where you are advocating raising corporate taxes then post them, they certainly aren’t on this thread (although I said I’d never SEEN them, not that they never existed).

    But as for ‘banning'; dude, you just finished calling the leader of the NDP a bald faced liar (Cardy: “What turned me against it was a combination of research showing the inherent risks….” Richard: I don’t buy that for a second.) So cut the melodrama. And finally, ‘advocating’ something is different than just saying it. You were pretty clear-not until they advocate raising the HST will you pay attention. So again, highly doubtful you are going to be an NDP voter anyway.

    It’s just basic accounting that IF you are short during the year, then you make SOME changes to find out if it covers the amount. Even Alward agrees with that, and so far the only real change has been belt tightening. So as we all agree, you raise the CIT and PIT, then find out how short you are the next year. IF its required, THEN you talk about raising the HST. That sounds like pretty responsible fiscal policy. But like I said, HST affects lower income brackets more, so use the progressive income taxes FIRST. Heck, Mr. Campbell himself points out the huge increase in earners over 100 grand. And I’ll bet a good percentage of those are those who earn their salaries from the public dole.

  11. Will says:

    I just wanted to point out that in terms of income, people like myself keep the revenue from IT consulting in the corporation and pay myself a small personal monthly dividend to pay the bills. I guess I got tired of paying 50% of my income above ~$60K as well as EI and CPP and other deductions. So I assume this would skew the actual results of income to some extent depending on how many others do this.

  12. Will says:

    When you mentioned people send you fear mongering reports about shale gas, it’s so fascinating to me that in this information age, people won’t spend the time to research a topic and learn how to debate using critical thinking instead of personal attacks and other fallacious arguments. They’ll just ‘share’ the link since it conforms to their world view. I’ve already debunked the earthquakes, methane gas, waste water, Cornell study, drillling fluid and other red herrings.

  13. [email protected] says:

    Which is all the more reason to raise Corporate taxes as that is where the biggest growth is. It is that way in the states as well, where the richest 1% is SO rich that I’ve read the census data doesn’t even include it since it skewers the result so badly.
    In either case, it is also partly symbolic. It’s interesting that people will say ‘yes’ to fracking, but absolutely don’t touch taxes, even though at least for the next few years-which may well be the worst financially- it will have more impact. And this even though a politician can EASILY say “hey look, we’ll lower them when things improve”. With so many public servants I’d almost think it would be a prudent move to equate pay scales with public revenues.

    As for the digital age, that doesn’t change human reactions, and those reactions are pretty reasonable. You have a provincial government that essentially subsidized corporations which came in and wiped out huge swaths of the forest, then left when they wouldn’t get subsidized even more. Environmentally, New Brunswick has amongst the worst regulations in the country, so that people will ‘believe a link’ seems pretty reasonable, not amazing at all. Again, go watch “Forbidden Forest” if you are still under the illusion that the Department of Natural Resources is there to ‘protect’ resources.

    As for fracking, its true there are lots of people that believe all kinds of things, but what is MORE amazing that at this blog there is a group of educated guys who seem to think “well of course the government is going to pursue this with the proper regulations in place”. Again, it was ONLY because of protest that Alward introduced ANY regulation at all. Why somebody would support development of a resource WITHOUT first having the regulations is beyond me. But like talking to a protestor, I could repeat that til my fingers are blue.

    It’s true that SOME of the environmental topics get little airplay-I still remember people going on and on at the CBC comments saying ‘we should wait until they have this technology they are working on in Britain which lets them re-use water’. It turns out they have been using that technology for years right in NB. But that doesn’t mean the only reason people oppose it is because of red herrings. There are TONS of legitimate reasons to oppose it, particularly, as I’ve said, since we’re still waiting on those regulations.

    Just to add some science though, its been awhile but it was only six months ago that they had just started studying the earthquakes in Arkansas, and anybody that thinks they can ‘debunk’ anything about earthquakes, which are notoriously unpredictable, well, I’d have to see that bunk. You might also want to add the Duke University study as well though. However, the main fault here is that, especially in Canada, there are almost NO studies done of the impact of industry on various aspects of the environment, let alone health, and even less coverage of ones that do. Nobody even mentions the environmental impact of, say, the peat moss industry, which has had a few studies done on it.

    In short, when you have as bad a science program as David indicates, and an even worse media, its no surprise people believe, well, almost anything. But to say “hey, we tried basing our economy on a natural resource before, maybe we shouldn’t do that again” seems a pretty natural comment-whether you agree with it or not.

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