McKenna’s world

He was in Cape Breton on Wednesday telling people – For every situation, there is some bad and some good, McKenna said, but people have to focus on the good. “The helping hand that you’re looking for here, as well as across the region, can be found right at the end of your own arm,” he said. “Nobody is going to come in and do it for us. On the other hand, nobody but nobody ever walked in and put a spot on our forehead and said you’re a doomed and disadvantaged people.”

He was in Saint John on Thursday telling the TJ “It would be an extraordinary act of leadership if we were able to get all of the Atlantic provinces moving together, creating a very significant reduction in taxes,” he said in an interview with the Telegraph-Journal Thursday.
“While individually we can make some incremental progress, we could make so much more progress together.”

He has become larger than life but I wonder if he has ever spoken candidly about his own misgivings about New Brunswick during his tenure? About the fact that population decline really started under his watch (the 15 year string of consecutive years of net out-migration started in the early 1990s). About the fact that beyond call centres his ED efforts had limited success. About the fact that his government was not able to craft a sensible economic development policy for northern New Brunswick. And, most importantly, why he was not able to permeate a culture of economic development throughout the civil service. After he left, the whole thing went down like water out of a tub (at least the enthusiasm for attracting business investment to the province).

I like his ambition for the Atlantic Provinces. And I think he was a good Premier. But I think many of the things he couldn’t address in 1988 are still plaguing us in 2008 and he should be talking about that.

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0 Responses to McKenna’s world

  1. mikel says:

    Sadly, McKenna has become a legend in his own mind. His only claim to popularity is that he sometimes gets some recognition in Ottawa so people still like to think of a maritime leader of the liberals or even PM, both of which are highly unlikely.

    He’s become a shill for the Caryle Group and few people really take him seriously except media. Again, New Brunswick gets 3% of its provincial budget from corporate income taxes with three billionaire family empires living in a tiny province of less than a million people. You have to be seriously delusional to think that taxes are in any way the problem.

    And of course even corporations themselves keep on saying that taxes are never an issue, its only at the political level that it gets any resonance at all.

    I know a few Cape Bretoners and I doubt they even take him as seriously as he is in NB, but a guy has to make a living eh.

    As you say, it would at least be interesting to hear him if he’d talk about his own failures as Premier, or even what he would have done differently if he hadn’t CHOSEN to bail.

    It could be possible that the civil service and corporate families are so powerful that even a Premier couldn’t do what they wanted, whenever politicians talk about ‘regionalizing’ things thats often the main point-to dilute local powers that have become too powerful. In his position he could at least come out and say it.

    McKenna’s record as ‘business friendly’ extends only as far as his communications department. Like any Premier he simply banked on benefits which existed at the time and which he had little to do with (and which sadly don’t exist anymore). Again, its worth repeating Savoie’s book on regional economic development-it was the province, the supposed business friendly neo liberal government of McKenna that turned out to spoil the opportunity of economic development in that region.

    After all that, its pretty hard to take the guy seriously.

  2. Anonymous says:

    I can’t believe Mikel and Campbell are in agreement.

    What is most sad, and this is reflected in DC’s post of yesterday I think, is that there is a void in economic leadership in NB. Our current Premier is nowhere to be seen and save for promising change he has no plan. The Tories have nobody, so who is going to take the leadership position?

  3. Anonymous says:

    While I don’t disagree with the points made in the post and Mikel’s comments, I think you are both being a little too harsh.

    Conditions were different in the McKenna era. It is easy to forget that we had 15% unemployment and huge deficit financing going on in those days. We have graduated to 7 % unemployment, 5% in urban areas and lump sum payments on the debt. This momentum started under his rein.

    As with all governments, it is difficult to determine the contribution they may/may not have made with their policies and what would have happened regardless of their actions. However, I will give McKenna credit for the restoration of some hope and some confidence that we can affect change and influence our destiny. Unfortunatley, instead of building on this, subsequent governments have killed the momentum. Here we are with some of the largest projects in the country on the radar (LNG, potash, Lepreau refurb, Lepreau II etc) and most people have a negative outlook.

    McKenna’s energy, enthusiasm and can-do attitude did attract some companies here; companies that could not identify NB on a map before he and his team pursued them. That same energy and enthusiasm got people thinking about putting energy into looking for a job rather than protesting to get better welfare or EI benefits. That energy got outside people excited and believing NB could actually execute on something; when is the last time a NB premier was tailed when visiting another province?

    Certainly no premier is perfect or even close to it but with the ‘options’ we currently have, if McKenna was running in NB today, he’d have my vote.

  4. nbt says:

    He has become larger than life but I wonder if he has ever spoken candidly about his own misgivings about New Brunswick during his tenure? About the fact that population decline really started under his watch (the 15 year string of consecutive years of net out-migration started in the early 1990s). About the fact that beyond call centres his ED efforts had limited success. About the fact that his government was not able to craft a sensible economic development policy for northern New Brunswick. And, most importantly, why he was not able to permeate a culture of economic development throughout the civil service. After he left, the whole thing went down like water out of a tub (at least the enthusiasm for attracting business investment to the province).

    I don’t think so. The statist — government knows best attitude — is alive and well in Fredericton and has been for quite sometime.

    However, I sense that all the above may have been curbed (or avoided) had [McKenna] thought back then like he thinks now.

    Let’s face it, he’s as close to a big business republican (Canadian neocon) as you can get. Advocating lower business and personal taxes, smaller government and spending reductions (thx Donald), cutting welfare payments to induce “a pull yourself up by the bootstraps” attitude, and last but not least, scrapping useless regional development agencies in favour of more tax cuts. Not exactly the guy you worked under during his statist (spending days) during the 90s David.

    And now that the federal PCs have been snuffed out by the Reform party/Alliance power grab in Ottawa, McKenna can stake claim to the same territory that Mulroney did in the 80s. To be honest, he’d be smart in pushing his policies even further to the right then Mulroney did because there are a lot of disenchanted conservatives who are unhappy with Harper’s move to the middle.

    Plus, Harper can’t seem to connect with Atlantic red tories, Ontario urban/modern tories in the GTA or right wing liberals in urban centres like Montreal and Vancouver. Areas, as Chretien demonstrated, where a majority can be formed.

  5. mikel says:

    Governments of course DO know best because they are the only organization that represents everybody. The idea that ‘business knows best’ when business owners represent a tiny minority is like thinking that ‘environmentalists know best’ or ‘architects know best’. They are just one group among many.

    But for McKenna, my comments weren’t meant to be harsh but critical. All political leaders can only operate in the economic climate they live in.

    As NBT says though, IF McKenna had seen deficits as a huge problem, then he would have tried to cut them, NOT increase them.

    And McKenna only ever represented the business sector, contrary to what NBT insinuates. The BIGGEST gift, and the act that shows more about NB politics than anything else, was the creation of a group of millionaires by taking something illegal and turning it into a cash crop at the expense of the poor. It’s unfortunate that there is a media monopoly because the VLT story has been written up in a few studies and essentially the NB government became a willing participant in organized crime.

    Unemployment was a huge issue, but all that changed was the permanent addition of a low wage workforce which has kept wages low. Of course unemployment is a non issue, because all the unemployed simply moved to ontario and Alberta.

    You can also look at other sectors and see how this failed. I’ve mentioned before that literacy was an even bigger issue then than now, and while other rural based economies were spending more on education, NB slashed spending and you can look at the literacy stats to see how that has worked out. Had that issue been addressed then some of Richard’s concerns about the university would not exist and there would at least be the potential for new technology research.

    McKenna did lots of travelling and shouting, however, there’s a valid question as to whether it was the shouting or the FACT that NB had considerable economic benefits available to corporations back then.

    What he did well was communication, and IF a person got a smug feeling about being a New Brunswicker because of his actions, at least that’s something. Lots of people are smug about being from wherever they are from anyway, and there’s an old welsh saying about the ‘horse of pride’ that says that the less a person has, often the more pride they possess.

    The fact that McKenna got only 60% of the vote his first election and then saw it go down from there says a lot. But like the above says, times change.

    We live in a world of global warming where people put environmental issue at the TOP of their concerns, even a close second in war torn areas. So its no surprise that people aren’t bend over backwards exstatic about short term construction jobs and the relatively few permanent jobs that seem to only derive from a massive giveaway of the publics only resources and by undertaking serious health risks (and at a time when guys like Savoie are talking about more privatizing in healthcare).

    Just recently the feds and universities did a study on forestry views and even though NB is in a forestry crisis, environmental issues were at the TOP of the list.

    The difference now for the government is that the ONLY economic prospects have serious repercussions for the majority while only serving the interests of the minority. So don’t look for huge publicity ads, because the government KNOWS that. That’s why they do that thing that irritates David so bad, which is convolute labour and economic statistics into ‘good news’ no matter what it is. Like other governments they are banking that as long as people don’t see a crisis, then enough of them will vote for them. McKenna was largely the same, the difference is that the idea of a politician as ONLY a business pitchman was fairly new at the time, now, its almost a given that that is a Premier’s main job.

  6. Anonymous says:

    Until a provincial government can demonstrate some fiscal responsibility with our money, we are better off with less taxes.

    Politcial payoffs like $60M to the Caisse (that’s nearly $200 per taxpayer), an organization clearly contaminated with fraud (but in the ‘right’ location with the ‘right’ leadership) does not encourage me to hand over more of my hard earned money for them to buy votes and support political buddies.

    Even well-intentioned efforts that
    fail (like $80M to an Atholville yarn factory) are somewhat more acceptable than bailing out criminals.

    I could tolerate higher taxes if there was less emphasis on political investments and more on strategic investments. Perhaps we need to look at things like proportional representation before this can be acheived.

  7. David Campbell says:

    A couple of quick follow up comments. I think Frank McKenna was one of the best Premiers I have seen – across Canada in the past 20-30 years. I just think that alot of what he wanted to do, didn’t happen and I think it would add an important commentary to the mix if he would come out and talk about it. Why did the call centre initiative work while so many others didn’t? Why did Slemon Park on PEI become an aerospace hub while his efforts for Chatham didn’t accomplish much? Etc.

    And on the Caisse ‘bailout’ all I can say is this. Bear Sterns was given billions by the U.S. Federal Reserve to ‘bail’ it out last month. The reality is they were not trying to ‘bailout’ the management of Bear but ultimately the average joe on the street that is mostly impacted by the subprime meltdown. Same with the Caisse – sort of. If you let it fail, a lot of good people would have lost at least some of their savings.

  8. nbt says:

    The reality is they were not trying to ‘bailout’ the management of Bear but ultimately the average joe on the street that is mostly impacted by the subprime meltdown.

    The pain trickles up argument of Obama. lol Being a community developer, I knew you’d like him.

    As for McKenna, I’m still not sold. At least not until some of his “libertarian rhetoric” becomes reality.

  9. Anonymous says:

    You just identified one of the McKenna’s few failures.

    Truely outstanding leaders define cultures and build teams with the ability to sustain momentum after they are gone.

    As you say, that did not happen.

  10. Anonymous says:

    McKenna was good at what he did. All he really ever did was talk louder than everyone else. Unfortunately that doesnt really work too good when there is nothing behind the rhetoric. It is the same with the current joke of a Premier that we are stuck with now and the one before and the one before.
    McKenna is still here and still shouting. What is it they say about empty vessels?
    Would it not be a good idea for McKenna to shut the hell up for once and quietly do something from within the organisation he currently works for. If he loves NB so much why can’t he just represent the case of the general public in the boardrooms he inhabits (according to himself) all over the world? What is stopping him?
    He has been the Canadian Ambassador to the USA for Christs sake! Working from Washington, hand in glove from the seat of the largest free markets in the world during a time of unmitigated global boom and what did he bring to NB? Not much. Ireland did well out of the US economy during this period so it could be done.
    One has to search for the reasons why he is so loud in public but such a lamb in private. I have my suspicions but I dont want to come across as a crank cynic. I’ve never been impressed by McKenna and the way he works and I remain duboius, then again, I never would trust a politician and thats what McKenna is when you boil him down – a very clever politician.

  11. mikel says:

    To talk about the other side, it’s fair to say that McKenna, more than a decade later, still gets talked about probably more than Lord, who just left. The point is that by now virtually all of McKenna’s policies can be called ‘failures’ for various obvious reasons. I may even be inclined to go further, I think the VLT deal strongly suggests that he was just an organized criminal. It’s one thing to legalize an illegal activity, its another thing to offer monopoly contracts to the few individuals who were carrying out the illegal activity in the first place. That’s like Chicago lifting the ban on liquor and giving Al Capone a monopoly on booze. It’ not a ‘crime’ but only because its being done by those who control the courts.

    Yet there is no place to talk about any of them. I read an american book that talked about ‘failures from good intentions’ in social policy and the first case study was McKenna’s ‘workfare’ program, which of course had similar failures all over North America.

    But David’s entitled to his opinion, but the rest of us need to see some of this evidence that makes McKenna so much better than other Premiers. Most other Premiers at least accomplish what they set out to do-whatever it is. For the most powerful politician to be said to have ‘not been able to do’ what they wanted says it all.

    With his connections why exactly could Chatham not match PEI? And that doesn’t even get into social policy, this was a premier who sic’d the RCMP on protesting mothers and children at school closure protests after all. And now we find that that has as much to do with failed ED as anything else-you aren’t going to find R&D when the population can barely read.

    As for the libertarian rhetoric, that’s all ANY politician delivers. Bailouts have become the standard all over the world, there have been three in last three weeks in the US, in Great Britain one of their largest banks has just been ‘nationalized’ because they lost so much money. Funny how all the critics screaming about Chavez nationalizing PROFITABLE industries don’t have nearly as much venom when governments all over the world nationalize failed ones.

    But that’s the modern economy, give the rich leave to plunder,and if they fail then you bail them out. In fact, NB is even WORSE, as they continually ‘bail out’ one of the richest families in the world, even when their business models are so profitable that any bank would be drooling to be involved.

    As for the Caissie, I sort of agree with both sides. If the Caissie had gone belly up then people would have lost a lot of money in an area which can’t afford it. No doubt ‘libertarians’ would say, “too &^%$ing bad because you’re stupid enough to put it in a credit union”, but that doesn’t change the economics of it.

    And MOST people in NB know that full well and are far from NBT’s view, because most of NBers have been at some point had their income dependant on government and its services. However, stopping the investigation and not following the money trail are actions no less reprehensible than the US bailouts that simply continue unabated with no changes in how the economy operates.

    At least nationalizing an industry ends up serving a public good in the future (unless it just gets sold again), just bailing it out just reinforces the idea that the wealthy need not even address the problems (and there are LOTS of them). Governments always SAY they will address the problems, but that is best exemplified in the US with George Bush making such ridiculous claims when he was deeply involved in most of them.

    But that’s the upside down world of politics. Before people assume ‘we are better’ it should be pointed out that Canada, and NB in particular are far worse, because its only a very few cases where these things are even addressed or can be discovered.

    But as for McKenna, what can be seen here is what I said, that nobody takes him seriously. IF he had a track record of success where people could point to SOMETHING which would make his advice stand out then that would be one thing, but he’s just shilling the Atlantica party line (not the party, but AIMS). Even if he DOES mean it it is simply nonsense. He is doing what AIMS has always done-make sure nobody gets the bright idea of actually taxing those who have money and dealing with the real problems.

  12. Anonymous says:

    David, I think you have identified a great topic for a research paper that could really help NB’s ED effort; a study of how Chatam and Summerside were in the same situation and NB ED failed while PEI excelled.

    Seriously, this really might help people understand what has to be done to have some ED success; we must focus efforts and not attempt to be everything for everybody.

    Like Ireland, Korea and other ED success stories [even NB’s contact center initiative], Summerside excelled by focusing on something where they thought they had an edge(on aerospace repair and overhaul). They encouraged federal support to be channeled to that sector and prioritized it in provincial budgets. They assigned an ED manager to lead the cause. They listened to clients, identified weaknesses and closed gaps. They modified community college programs to graduate students that the businesses needed. The premier(s) spoke of aerospace often and were personally committed to the cause.

    Most of us know the things Summerside and PEI did to succeed. More important is what they did not do. They did not try to patronize voters by setting up competing aerospace parks in Montague, Charlottetown and Tignish. They did not try to set up an french Acadian aerospace center. They did not try to diulte funding by equalizing it with 10 other ED interests. They did not get pre-occupied with urban/rural issues, etc.

    The ED success formula is widely known; unfortunately the courage to execute it is rare.

  13. David Campbell says:

    I don’t know about anyone else, but I have never subscribed to the weird equalization thing that its tried in New Brunswick when it comes to economic development. I would be very supportive of distinct and concentrated ED efforts in geographic regions in the province. For example, if you were going to fund an Animation R&D incubator it would have to be in a specific city. That doesn’t mean ignoring other areas, it just means focus.

  14. Dan F says:

    The reality is they were not trying to ‘bailout’ the management of Bear but ultimately the average joe on the street that is mostly impacted by the subprime meltdown.

    This is the most nonsensical statement I have ever read.

    For an economist who makes these calls based on his ‘feelings’ (see you post, ‘taxing the poor’) – you must be feeling pretty confident peeking up at that 500 trillion dollars or so in fictional derivative-type ‘products’ overlying our entire corrupt economy.

    The other shoe should have dropped long ago – we’re living in a world where some Chinese/America/Saudi Generalissimo could buy up New Brunswick and turn it into a parking lot / gasoline store combo if they felt like it.

    Problem is, our failed and corrupt business scions have no compunction against selling to them or trying to beat them to it.

  15. Danny D'Amours says:

    One little point that was missed in the comments about the Caisse. Lord and the PCs were the ones which passed legislation which guaranteed 100% of the deposits held by credit unions so if the Caisse did go under it would be the taxpayer hurting (probably for more than 60 million) and not the customers of the Caisse.

    Not that I agree with bailing out failing (and possibly corrupt) businesses and business models.

    In this case it seemed to be the less of two really bad scenarios. I would have preferred to a loan and/or some kind or some equity given to the gov’t as opposed to a straight bailout.

  16. mikel says:

    Something else not mentioned is that there was a GOOD reason Lord did that legislation. The big banks were following policy by neglecting ‘have not’ areas and credit unions cannot compete with the FEDERAL legislation that guarantees deposits of the major banks. This was ‘levelling the playing field’ so to speak.

    This is where ideology breaks down because ANY public policy done in secret ends up dubious. That’s the unfortunate part about private transactions and why they are usually opposed by the public-because there is no way to even judge whether they are legitimate.

    However, those are good points about Summerside but I’d state that LOTS of New Brunswickers have no idea of the details, I’ve never seen any media reports, in fact there are no television shows of that type that even talk about this stuff. I’ve talked to a few people about it and most didn’t even know PEI HAD an aerospace industry.

    But most importantly, here we can tie in David’s point about ‘analysis through paralysis’ and some other points (vaguely even touching on Dan’s).

    While there are cases like trauma centres where city’s compete they are few and far between. While there seems to be this notion that ‘what one city gets the others should get’, that doesn’t hold up to analysis. Fredericton is going into debt to build a convention centre with help from the province, this is NOT because St. John has a convention centre, its because EVERY city practically has a convention centre.

    In the 90’s Moncton got massive federal and govenrment spending, it is a real success story, I don’t know why people ignore it, maybe its that ‘culture of defeat’ or something. But St. John and Fredericton weren’t kicking and screaming that Moncton got all these benefits. The one thing people still point to is airports, but so what, nowadays virtually every city is trying to get an airport.

    But again, NB HAS its own ‘aerospace’ industry, its own ’emphasis’. It’s ENERGY. It’s potash. It’s rail lines and highways as part of the atlantica initiative. They’ve said so, and like PEI they are ‘ignoring all other sectors’, and they are essentially doing everything the above poster says about PEI and aerospace.

    The problem is NOT that people don’t know the options or haven’t presented them. In the miramichi the only thing lacking for animation is political will, I suspect its because NB has been a resource province for so long they simply don’t have the confidence to really push it. You can imagine all these older white haired guys going “cartoons…really?”

    The problem is that the industries they ARE pushing have very dubious economic prospects. In PEI you could imagine critics saying the same thing “what if this doesn’t work?” “what if this is just corporate welfare”. The only difference between investment and welfare is really the perception and the success.

    So again, in NB you guys are in the position where you don’t think NB’s ‘aerospace sector’ is going to work or is worth the trouble or what have you. To combat that, again, that’s a POLITICAL problem, not an economic one. They’ve picked their ‘aerospace sector’ and are gunning for it. So you can’t complain on that measure. Sorry I don’t have time to edit/shorten that.