It's The Economy, Stupid

I have beem combing the world looking for things that New Brunswick has done right. Excellence that started in our problem.

Here’s an example.

Service New Brunswick was cited as as model for government service delivery by the Center for Technology in Government (CTG) at the University at Albany in New York.

Too bad that model was developed over a decade ago.

Still looking for world class stuff (musicians, atheletes, business leaders, innovations) coming out of New Brunswick in the past 7-8 years or so.

Any ideas?

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If you like the tourism sector, this must grind your gourd a bit. Total food service sales in New Brunswick in July suffered the second highest decline but more importantly NB is second last in the country for per capita spending on this sector. But, in fairness, there’s a bunch all clumped together down there – Newfoundland, Sask and even Nova Scotia is not much higher. Then there’ s a major jump to PEI, Ontario and our friends in BC who spend almost double per capita on eating out compared to New Brunswick.

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This is kind of cool. It is an average housing cost comparison from around the world.

All figures are in US dollars.

The average house costs $1.8M in Beverley Hills, CA and $190k in Moncton, NB. However, that same house will set you back $375k in Portland, Maine. Looking to move abroad? Expect to pay $623K in Sydney, Australia. But if you are a fan of Hugo Chavez, you will only pay $113k for the same house in Caracas.

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From today’s Globe & Mail.

The Conservative government won’t subsidize the proposed Mackenzie Valley natural gas pipeline, but Ottawa’s top negotiator said taking an equity stake in the struggling project is possible.

“In the past … governments have participated in private sector projects of various kinds, in various guises, as equity partners,” said Andrei Sulzenko, the federal government’s chief representative for the Mackenzie project. “In those circumstances, those are commercial terms. There’s an investment [and] because of the risk, there’s a return to the taxpayer. I don’t see that as a subsidy.”

I would assume that Mr. Sulzenko is a reasonably smart fellow. If it wasn’t a subsidy, why is government investment even needed?

The bottom line is that in this higher risk, large capital investments, the private sector wants the public sector to investment to – drum roll please – lower their risk. Hence, a subsidy.

But let’s not get caught up in semantics.

If large scale investment in risky projects that the private sector won’t take on by itself is not considered a ‘subsidy’ by the federal government, I’m okay with that.

So, when Nova Scotia asks the Feds to invest $500 million to do very risky exploration of offshore oil & gas, I’m sure Mr. Sulzenko will oblige. After all, that’s not a subsidy, that’s an investment.

And of course don’t forget about the Technology Partnerships Canada program which made $3 billion in ‘investments’ into companies in mostly Quebec and Ontario.

Not subsidies, investments. Let’s just change the terms.

Fine. I want the Feds to ‘invest’ in economic development and help the province attract large scale, anchor companies.

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Brad Green must be a bit cranky these days.

You give the public sector the second highest increase in average weekly wages in Canada and they boot you out of office. Average weekly wages increased by over 25% according to Statistics Canada from July 1999 to July 2006. The average public administration worker makes 31% more than the average general worker in New Brunswick – one of the highest differentials among the 10 provinces in Canada.

And yet, those ungrateful public sector voters still dumped old Brad out on the street.

Guess there’s more to life than salaries, huh?

I guess a lot of bureaucrats said thanks for the bucks but we also want fulfillment in our careers.

Or something like that.

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Yesterday’s Statistics Canada population estimate shows that there are 2,313 less people in New Brunswick in 2006 compared to 2005. The population of young people dropped by over 4,000. This is the top headline story in the TJ, CBC and most media outlets this morning. Al Hogan buries the story on page four in a small, unanalytical piece.

And instead of a thoughtful “We Say” editorial about the most important challenge facing New Brunswick since Confederation, Al decides to provide Stephen Harper ‘advice’ on where to cut taxes.

He will bring us all down and then move back to where ever he came from.

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Today’s Statistics Canada release of new population figures are undoubtedly another reason why Premier Lord called the election. I am sure that certain elements of the media (and bloggers) would have tried to make hay with this data (except Al Hogan).

Canada’s population increased by over 323,000 people in the last year alone (estimated) and all
New Brunswick could do was witness a population drop of 2,313 people last year.

It’s interesting to note that PEI’s population is increasing.

People say to me that dropping 2,000 people isn’t that bad.

Look at the trend folks. In the 1970s, population growth in New Brunswick was in the 5-6% range from Census to Census. Then it dropped in the 1980s to 2-3%. Then it dropped further in the 1990s and the last Census 1996-2001 saw a population drop of 1.2%.

It is very likely that the 2006 Census (data released next year) will show an even steeper decline.

Look at the chart. In the early 1970s, New Brunswick’s population actually grew faster than Canada as a whole. Then it dropped and dropped and dropped.

Use your imagination to extend this out another decade or two. It won’t be pretty.

Notwithstanding Al Hogan’s Pollyannish world, this is serious stuff, folks.

Time to get crackin’

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There’s a letter to the editor in the TJ today that I found interesting:

Graham must unite the province

There are a great many challenges facing New Brunswick’s new premier in the months and years ahead but in the immediate future there is none greater than to overcome the divisiveness that will be the legacy of Bernard Lord. It is a divisiveness that began subtly in the McKenna years, when the focus on developing the city of Moncton began.

At the expense of the rest of New Brunswick, Lord flagrantly continued, heaping hundreds of millions of dollars on Moncton while the rest of us could only hope we might catch a few falling crumbs from their elaborate banquet table.

The result was the creation of two solitudes in our province, the City of Moncton and the rest of us. It is unforgivable that any government would foster and openly support a policy that divides a province.

I would like to have shared in the excitement that comes with a municipality that is flourishing and doing well. I would like to have shared in the thrill of the successes the City of Moncton was enjoying, but it quickly became clear that they would have none of it.

Shawn Graham and his government must bring a much more balanced approach to the future of all of New Brunswick, not just one municipality. It is imperative that the new premier demonstrate quickly that the rest of us in New Brunswick do matter, that we do have some value in the future development of our province as citizens, as communities and as municipalities, all of whom share in contributing to the greater good.

Congratulations to Moncton on all they have achieved during the Lord years, no matter how they have achieved it.

Now, Mr. Graham; what about the rest of us?

As somebody who has spent a more that average amount of time studying these issues, I am not sure that this letter writer has the facts right.

You may argue ‘chicken’ and ‘egg’ but regardless of your ideological persuasion growing communities require more government spending (reactive) while stagnant or declining communities would like government spending to spur growth (proactive).

The letter writer’s tone would indicate (and I put this here because I have heard this alot) that government spending in Moncton was actually a driver of economic growth but again I come back to the chicken/egg dilemna.

We will know when the 2006 Census data comes out next year but let’s just say that Greater Moncton (broadly defined) has added 20,000+ people in the past 15+ years.

It is only logical that you would need some expansion at the hospital and a new bridge to Riverview to accommodate this growth. In fact, many Monctonians argue that there wasn’t enough provincial government investment in Moncton to support the population growth since the late 1980s.

My brother told me over the weekend “It looks like Moncton’s done now” after not electing very many Grits to the Legislature. I couldn’t believe it. Do all New Brunswickers believe that government decides who wins and who loses?

That’s nuts.

Moncton’s economic growth over the past 15 years has been based on economic factors – supported by in the 1990s a strong economic development focus out of Fredericton. Government capital investments had little to do with it. In fact, the wish list of Moncton is probably as long if not longer than the rest of New Brunswick (Court House, Convention Centre, Overpass at Airport, etc.).

Some enterprising journalist or blogger with more time should actually take a look. Look at all the capital spending of the provincial government over the past 15 years adjusted for population growth (i.e more population should necessitate more government investment in infrastructure). This would be tricky but doable.

The real issue is not whether Shawn Graham gets bogged down in the politics of ‘uniting the province’ or whether he will get busy working on a growth agenda that will benefit all of us.

Some people look at government spending as a pie that gets divvied up and they want ‘their share’ for their community.

I look at government spending as an investment that if spent wisely will grow the pie so that everyone can get more.

The focus of this government has got to be on re-energizing a sagging economy by leveraging government spending into large scale new private sector investment – all over the province. We were dead last in GDP growth among the provinces sinc 2000. Our job creation has been among the worst in Canada. Many of our traditional, bedrock industries are under serious duress.

If the Cabinet spends its days figuring out how to carve up the pie rather than increasing it, we will all lose.

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In the “Global Competitiveness Report 2006-2007” released today by the World Economic Forum, whose Canadian partner is the Institute for Competitiveness & Prosperity, Canada moved down in the rankings over 2005’s results in both of its competitiveness indices. On the “Business Competitiveness Index,” Canada moved down to 15^th from 14^th. On the “Global Competitiveness Index,” Canada also fell – to 16^th from 13^th.

Roger Martin, Chairman of the Institute for Competitiveness & Prosperity and Dean of the University of Toronto’s Rotman School of Management views the one-year drop in rankings as part of a longer term trend which indicates that Canada is not fulfilling its full economic potential.

The esteemed Dr. Martin – of Rotman and all that rot.

Here’s a tip. The OECD said in 2002 that the lack of coherent regional development in Canada was a threat to the country’s long term prosperity.

Ooops. I am sure that the Toronto-centric Martin meant Ontario when he said ‘Canada is not fulfilling its economic potential’. It must have been a slip of the tongue.

Because I don’t remember the last study coming out of Martin’s institute that gave a crap about the chronic underperformance of Atlantic Canada or any other place in Canada that has not performed well.

In fact, that Institute has called Equalization a drag on the Ontario economy.

Canada will not ‘fulfil its full economic potential’ when huge segments of the country are in population and economic decline. No matter how much Equalization is spread around

But look at the good news. At least we are slightly ahead of France.

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While Spink on It will undoubtedly reach for the Rolaids, I think this is a very good idea. I still think that the CBC plays an important role in the local media balancing the crap coming out of the Times & Transcript and the boiler plate and yelling coming out of Rogers 91.9.

Anybody see the photo of Andrew Krystal on the 91.9 web site? He looks and sounds like Fraser – you know the TV show about the radio guy. Freakish.

But I digress.

CBC Nation Awaken!

Write a short but potent email in support of the CBC’s application to broadcast in stereo.

Click here, scroll down to application # 200607632 Canadian Broadcasting Corporation. Make note of the application # and then click on the button to submit your comment.

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