The shifting definition of self-sufficiency

Premier Graham has a commentary in the three big English papers today discussing his first two years in office. In the spirit of this blog’s propensity for number crunching, we check some of the Premier’s numbers:

He says there are 15,700 more people working in the last two years. That is correct. From the Labour Force Survey -In August 2008, there were 366,500 people employed in New Brunswick. In August 2006, there were 350,200. The problem is 2007 was a jobs humdinger but 2008 is much more problematic.

In December 2007, there were 366,900 seasonally adjusted people working in New Brunswick (that filters out seasonal work) and in August 2008 there were 366,500. We are, I believe, the only province in Canada to register a jobs loss in 2008.

He also has some definitions regarding self-sufficiency:

“Self-sufficiency means that through our individual skills and through hard work, each of us has the opportunity to create the kind of life we want, right here in New Brunswick”.

But he does say:

“A self-sufficient New Brunswick will be a place where we shape our own destiny. For the province, that means lowering our dependence on equalization, creating more of our own revenues here at home and being a strong partner in the Canadian federation.”

That’s a far cry from eliminating equalization by 2026 – the statement that has been thrown around a lot but seems to be disintegrating a bit. In the past two budgets, Equalization funding has gone up and will likely go up for at least the next 203 years according to estimates.

Last point here. He says:

“There are capital projects underway and on the horizon that could create more than 30,000 new jobs, billions of dollars in provincial tax revenues and up to $44 billion in new investments in New Brunswick. Our government is making the necessary investments in infrastructure and in our workforce to ensure we can capitalize on this potential.”

This is what concerns me the most and has for months. Those 30,000 jobs are temporary – only about 3-4 thousand will stay around after the construction of those energy projects – by the government’s own reckoning.

Do you remember the boom after the original Lepreau/Refinery developments? How about the miniboom while the Confederation Bridge was being constructed? How about all those jobs from the twinning of the TransCanada highway?

Even if the energy projects go ahead – I would be far more interested to hear what is being done to grow other sectors of the economy in New Brunswick. The energy projects will be based on private sector business plans and will go ahead or not – with limited government effort.

What I am interested to see is where our government is planning to invest tax dollars to create economic development oportunity beyond the energy file. And we haven’t seen much of that yet.

You could have a situation whereby in 2026 you could have a new refinery and a new nuclear plant and less jobs than we have today across New Brunswick. If the call centre industry starts to drop in employment. If tourism remains tepid or declines. If the forestry sector remains the same or drops and if the 10s of millions of salaries generated from New Brunswick workers in Alberta dries up – you could literally see some serious economic problems by 2026.

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0 Responses to The shifting definition of self-sufficiency

  1. Anonymous says:

    2026 eh?
    Oh well I guess some people believe in ufo’s too.
    But I believe we will all be rich and happy by 2026.Same chance of being right.Seeing as we don’t have a political system that allows seeing past their next election.

  2. nbt says:

    That’s a far cry from eliminating equalization by 2026 – the statement that has been thrown around a lot but seems to be disintegrating a bit. In the past two budgets, Equalization funding has gone up and will likely go up for at least the next 203 years according to estimates.

    That’s the danger of raising the bar too high without a clear plan to get there. If you fail miserably (or don’t come close to obtaining any benchmarks), you risk damaging the electorate on the ground, which handed you the keys and entrusted you with their children’s future.

    In other words, you set yourself up for the type of failure which feeds into that ethos of local defeatism, in that, a broken promise like that could set the collective mentality of a region back twenty years.

  3. nbt says:

    Oh, speaking of economic development David, I see the Ontario government has launches a “fair vote” campaign. I guess they believe that since they hold one third of all the seats in Parliament, they should be entitled to the same programs as the rest of the country. Is it me, or is it odd to see McGuinty making this kind of pitch:

    Right now, laid-off workers in Ontario get $4,600 less in employment insurance than they’d get if they lived in another part of Canada.

    Federal health care money is supposed to be divided equally among all Canadians. But right now, Ontario is shortchanged by over $700 million a year.

    Right now, the federal government has an economic development program in place for people living in Atlantic Canada, and the north, and Quebec, and even the west. But it doesn’t do the same for southern Ontario.

    And, right now, the Building Canada Fund shortchanges Ontario by $970 Million on funding for infrastructure projects.

    Wow, I guess he forgets the trillions funneled directly into the Ontario economy (for well over four decades) via TPC [Technology Partnerships Canada], DIPP, corporate welfare for the auto sector, just to name a few.

    To be honest, this argument that Ontario is entitled to programs too reminds me a lot of how DREE changed its original format (and left Atlantic Canada high and dry) after the economy slowed down in parts of the island of Montreal, thus leading Quebec Minister (and head of DREE) Jean Marchant to buckle to regional pressure.

    Let’s just say, the program was never the same for maritimers after that.

  4. richard says:

    The window of opportunity for any sensible strategies towrds 'self-sufficiency' may have passed. The US is in a deep recession and global economic prospects are dim.

    Ottawa has, via tax cuts, greatly reduced its ability to respond to a financial crisis and the effects of a correspondingly weakened economy. Post-election, we are likely to see some substantial spending cuts in order to keep the federal books out of the red. This will provide the excuse to make all kinds of cuts to programs that Conservatives have ideological problems with, should they win a majority. Couple that with Ontario's apparent switch from being the 'national' province to being just another kid at the table, and Atlantic Canada could be in for some tough times. Instead of a planned move to a real self-sufficiency, we will be in crisis mode. And that means that some very wrong-headed decisions will be made. R&D investments will be cut, not increased; education funding will be cut, not increased.

  5. Anonymous says:

    Great post David. We need to be looking at long term economic opportunities. As you suggest SS is turning out to be a political buzz phrase with no substance.

    We have to look for trailing revenue, residual expertise for export and competitive advantages.

    Some ingredients are available; we need the talent, intelligence and commitment to develop a recipe.