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Grant Devine

Terry Alm Drive

In case you missed the amateur hour that was Saskatoon City Council, you missed the passionate debate over whether or not Mayor Donald Atchison should be able to name streets, parks, and bridges.   Here is what Ward 6 Councillor Charlie Clark had to say about it in his email newsletter.

City Council will receive a report with a few minor amendments suggested to the Naming Process.  Recent debates have raised the prospect of a more significant amendment to the process.  I would like the process to be changed so that the actual designation of names to parks and streets is not done solely by the Mayor.  Saskatoon is the only City in Canada that grants this power to the Mayor alone, and I believe it is time to change this. 

For me the issue is not out of concern with any specific names that have been applied in the City.  There are two main reasons. 

First having a single elected official hold naming power opens the process up to political influence, rewarding friends or campaign donors. This is not about Mayor Atchison specifically, but a question of good governance and creating policies that mitigate this potential. 

Secondly – there have been hundreds of names applied in recent years to streets and parks in the City, as we add on new neighbourhoods.  These names form the identity of our neighbourhoods and the City as a whole.  The responsibility for establishing this story for our community should not be the purview of one individual.  Ideally this is the kind of work that would have the input of people with historical knowledge and understanding of our community from several perspectives – to help ensure that as we make our mark on these communities with names that they capture a breadth of the history and identity of the City.  

There is a tremendous opportunity to develop a thoughtful process to ensure that these streets and parks capture the essence of who we are as a community and where we came from.  Right now the process relies on the public or property developers to bring forward names, a Committee made up of politicians and City staff determines whether a name can go on the “Names Master List” and then the Mayor picks the ones he wants to use. 

I think it makes sense to have a committee that has a mixture of elected people and the public on it to be part of the approval and application of names.  I also think that it would be worthwhile to engage our City Archivist and other historians to look at our Names Master List and identify which communities are being missed and a way to ensure that these get represented. 

Yes you read it right, Clark used the term, “tremendous opportunity” to describing a process that involved naming street names.  I don’t know what to say either except that its probable that Clark gets excited over governance things that I do not.

Whether or not you agree or disagree with this is irrelevant.  In my opinion it is a shame that we don’t have streets that honour Henry Dayday, Roy Romanow, Lorne Calvert, and even Grant Devine.  Heck I am all for an entire neighbourhood that uses names of former premiers. (austere houses are on Romanow Avenue while over mortgaged houses are on Devine Lane)

What does surprise me is that if council wanted to move on this, they should have done one thing really well.  They needed to have counted the votes for and against before the council meeting started and they never did that.  If they did do that and someone changed their mind (which it sounds like happened), that is politics but somewhere along the way, you need to know that stuff or you look like idiots.  So after some attacked and defended the mayor and in many ways made it personal, it was time to vote which was a five-five tie so the motion failed, the status quo continues and you look really small minded and petty.  Oh right, you have also just attacked the mayor (or one of the few perks the mayor has) and now you are left with nothing to show for it.  Well except with an even more divided city council.

Of all of the issues facing the city, fighting over who gets to name streets isn’t high on my list of things that need to be done.

Grant Devine 2.0?

It’s really odd to hear Alison Redford use the same rhetoric in Alberta that Grant Devine did in Saskatchewan during the late 80s.

In a series of interviews following her televised address to the province Thursday night, Redford said that she wanted Albertans to understand that the province should no longer rely on its resource wealth to balance its books, pointing to a $6-billion “bitumen bubble” that will cut the province’s anticipated resource revenue almost by half in 2013-14 fiscal year.

“We can no longer continue to rely on oil and gas for 30 per cent of our revenue,” Redford said Friday. “It’s a fundamental change. It’s the sort of thing a province has to deal with, I think, once in a generation, and this is our opportunity to do it this year.”

The provincial government has received plenty of advice in recent years urging it to wean itself off a practice of using resource royalties to balance its books.

The Premier’s Council for Economic Strategy, a panel of experts established by Premier Ed Stelmach, tabled a report in May 2011 that asked Alberta to divert non-renewable resource revenue instead into a new “shaping the future” fund dedicated to helping diversify the province’s economy.

The council’s chairman, former federal cabinet minister David Emerson, said Friday it sounds like Redford is looking to make that kind of shift.

“She’s looking at establishing a new fiscal regime and that’s essentially what the premier’s economic strategy council was calling for: To stop treating non-renewable resource revenues as a form of operating revenue to be spent on, in effect, buying the groceries and to become more strategic separating natural resource assets,” Emerson said.

“If that’s the case, my congratulations,” he said.

But while Redford said Friday that a “different” budget will be forthcoming, she also said will not be a disruptive document. The government has already sent some signals about what some of those changes might look like, she said, pointing to the government’s plans to borrow to fully twin a 240-kilometre stretch of Highway 63.

“The Highway 63 announcement signalled to people that we’re going to think differently about long-term infrastructure plans,” Redford told The Canadian Press. “We’re going to finance that differently. We’re prepared to go out to capital markets and to really put out stellar fiscal reputation out there and ask people to invest in our province in some of our public infrastructure.”

As of right now, however, Redford said tax reform is not part of that financial restructuring.

Right now it looks like a lot of talk without the deep cuts and probably tax increases needed to bring the budget back in line.  

Mount Royal University political scientist Keith Brownsey said Redford needed to make a case for a fiscal crisis in her televised speech. She did that in a reasoned, effective manner, he said.

Such a statement was needed, he said, because Albertans thought financial problems were something that were a thing of the past because of its resource wealth.

“I think she prepped us for both cuts and tax increases,” Brownsey said. “Now, she may not have said that today, she may have said, ‘No taxes,’ but the current revenue structure in the province is unsustainable. We cannot exist as a modern industrial state living off of revenues from non-renewable natural resources. It’s simply too volatile.”

The truth is that Alberta spends money like no other province in the confederation.  Even during the Klein crisis, they spent more money than everyone else.  People talk of the deep cuts he made but ignore the fact that in Saskatchewan, the NDP made even deeper cuts (and had to raise taxes).  Whatever the solution is that it should be a combination of taxes and spending cuts and it is going to take a bit of time.  

I have no doubt that Redford is serious about making cuts (and who knows, she may even raise taxes) but when the oil prices go up, will they stay the course and remake the economy, especially when the opposition will be calling for restored spending and tax cuts (it’s always going to be like that).  I really hope she sticks with it because the oil and natural gas won’t be there forever.  I know the oil sands are a massive reserve but not all of that is recoverable and there is a point where it gets more too expensive to go after it.

If her hero Peter Lougheed brought in Alberta 2.0, then Alison Redford will need to be the one to bring in Alberta 3.0.  I hope it’s more than Devine era rhetoric.

The Devine Generation?

Grant DevineSomeone is planning a 30th reunion for the Devine Generation in Regina.  This should be spectacular. I can see it now.  Megaprojects, caucus funds going missing, a significant deficit and instead of the event being just in Regina, it will be moved all over the province and be called, Fairshare Devine Generation.  The event starts on July 7th with an RCMP probe of the event to start on July 11th. 

Any thoughts on if any of the Saskatchewan Party cabinet shows up?  I am going to say no.

That being said, I still say that I would like someone to write the definitive history on the Devine years in office.  I think it would make for a fascinating read.

What went wrong for the Saskatchewan NDP?

The view from Calgary (and the Toronto Star)

“The NDP grassroots won’t even go door knocking anymore . . . the party only appeals to the mushy middle,” says Mitch Diamantopoulos, head of the journalism school at the University of Regina, a longtime activist and observer of Saskatchewan politics.

For Diamantopoulos, the problems began in the 1990s when then premier Roy Romanow swung the party to the right. “Saskatchewan shifted away from a cooperative, public enterprise approach and as a result a lot of longtime NDPers lost their enthusiasm for the party.”

At the same time, farmers were giving up on agriculture and moving to Saskatoon or Regina. As the province became urbanized, the NDP lost its traditional rural base.

In many ways, 62-year-old Lingenfelter personifies the confusion about what the party really stands for. He grew up in southwestern Saskatchewan on a large family farm. First elected as an NDP MLA in 1978, Lingenfelter managed to survive the near sweep by the Progressive Conservatives in 1982 and served as opposition house leader.

When the NDP was returned to power, he became a cabinet minister and eventually deputy premier and was seen as a likely successor to Romanow.

But in 2000 Lingenfelter abruptly resigned and accepted a senior position with an oilpatch heavyweight, Calgary-based Nexen Inc.

Not surprisingly, Lingenfelter became something of a trophy head in corporate Calgary — the former NDP cabinet minister who had joined the fold. So much so that in 2002 when a group of Calgary businessmen and politicians organized a fundraiser for the Saskatchewan Party at the Petroleum Club, Lingenfelter attended on behalf of Nexen and when introduced was given a special round of applause.

There are four things that I see going on in this election.  I am not an NDP insider or supporter although I have a good working relationship with many of them.  The first is Brad Wall.  He just hasn’t screwed up that many things.  If the old line is true that governments are so much elected but rather defeat themselves, the Saskatchewan Party haven’t made that many mistakes which makes it really hard to gain any traction against them.  Along with that is that I think the NDP elected Lingenfelter because they thought Wall would be a one term wonder and they would be back in power this election.  The choice of Lingenfelter as leader was an odd one because it was a return to the past, a past that Saskatchewan voters had just soundly rejected in 2007.

Next up is that I don’t think the NDP are any good in raising money.  NDP candidates are sharing campaign offices in ridings they should be competitive in the cities.  During the drive out to Arlington Beach, we drive through Watrous, Nokomis, and then from there we went to Regina through Craven and Lumsden.  We only saw one NDP sign the entire three hour drive.  One sign.  Even if they were not getting any traction with voters, you would have expected to see signs in the ditches and other public spaces.  There were none.  Meanwhile there was a lot of Saskatchewan Party signs (all on public land) but even in traditional NDP ridings in Regina.  What does it mean?  Signs cost money and I don’t see any of that in rural ridings.  I am assuming that the reason that Judy Junor is using office space downtown rather than in our her (hotly contested) riding is money as well.  This isn’t a couple of blocks outside her riding but is across the river from her riding.  C’mon.

You can blame that on the leader but raising money is also backend process that involves cultivating thousands of relationships and then understanding what buttons to push to get them to cough up $20 or $100 when you need it.  The federal Conservatives are masters of this and have been going back to the PC Canada Fund.  Whether it is direct mail or email, the NDP need to find a better way to cultivate, understand, and benefit from those relationships because the Saskatchewan Party can outspend them anytime in the election cycle.

Thirdly, the NDP are terrible users of new media.  Look at the video the Saskatchewan Party has produced versus the media the NDP are putting out.  Look at how Brad Wall is using Twitter vs. how Dwain Lingenfelter uses Twitter.  Why do I care how Link uses Twitter?  Social media allows voters to connect to a leader and if you are just posting links to some photos posted to Facebook and never send an @ reply, you aren’t connecting.  Wall understands that, Link doesn’t.  Not connecting to voters isn’t always fatal (like Stephen Harper) but it normally is (Elwin Hermanson, Michael Ignatieff, Stephane Dion).  Link didn’t connect to anyone online.

Finally, as much as Ryan Bater needs to win his seat in North Battleford, the NDP need him to win even more.  The NDP don’t do well against the unified right in Saskatchewan, they never have.  Brad Wall, Grant Devine, Ross Thatcher… when a third party (whether it be the PCs or the Libs) get 15% of the vote, the NDP win.  When they don’t, the NDP lose.  Their votes doesn’t grow enough to beat back the centre right challenger (for a contemporary example see Frank Quennel who is about to lose to Roger Parent in Saskatoon Meewasin).  It is why I was so surprised that the NDP didn’t want Ryan Bater in the debate.  A collapse in the Liberal vote benefits the Saskatchewan Party and no one else.  If I am the NDP I am hoping and praying that Bater wins, even at the expense of their own seat for the long term prospects of the party.

I don’t believe that the NDP are staying home and off the doorsteps because of what Roy Romanow did, I think there are elections that you win and some that you lose and this is one that the NDP are going to lose.   Wall’s performance is out of their control but if they don’t get the other three things solved, they are facing an uphill battle no matter what happens and no matter who the leader is.

When do you stop spending?

Jim Flaherty said today that he would spend to defend Canada from another recession

Under questioning from opposition MPs, Flaherty said for the first time that the Conservative government would move in with another round of stimulus spending if the world economy suffers a double-dip recession.

“We would obviously do what is needed” if there was a “dramatic deterioration” in the economies of the United States and Europe, he told the committee.

But for now, Flaherty said, the government is not changing its budget plan despite the turmoil on financial markets and debt crises in the United States and Europe. The plan calls for spending cuts of $4 billion a year to eliminate the annual federal budget deficit — now $32-billion annually — in a few years.

Pressed by opposition MPs about how Ottawa would react to a renewed global slowdown, Flaherty said he would change course and develop a pro-growth spending plan as the Conservatives did during the recent recession.

Here is my problem with this problem.  Do any of us think that the United States/Europe is going to fix their problems in the next recession.  I am not saying Flaherty is wrong but does this look like it’s going away.  Jeff Rubin points out that with global demand the way it is, as we come out of a recession, prices will increase and drive the economy back into it which means, how many of these recessions will we be able to afford to ride out until we are looking at Mulroney-esqe debt loads and Devine type deficits again.

We are looking at a default or massive bailouts for Greece, Italy, Spain, Portugal, and the too big to fail banks in Germany.  There is a dysfunctional governance system in the United States, and even China has some long term economic problems.  Does anyone think this next recession is going to be a quick one or we won’t be experiencing a triple or quadruple dip recession before this is all said and done?  No, me neither.

I know Jim Flaherty has been seeking out the advice of economic experts like former Calgary Flames captain Jim Peplinski but may the alternative might be figuring out ways to reinvent Canada’s economy to thrive in a world where recessions will be the norm, not the exception.

The Shape of Things To Come

60 Minutes had a feature on the budget crisis’ that are happening at the state level.  Stay with me on this one.

"The most alarming thing about the state issue is the level of complacency," Meredith Whitney, one of the most respected financial analysts on Wall Street and one of the most influential women in American business, told correspondent Steve Kroft

Whitney made her reputation by warning that the big banks were in big trouble long before the 2008 collapse. Now, she’s warning about a financial meltdown in state and local governments.

"It has tentacles as wide as anything I’ve seen. I think next to housing this is the single most important issue in the United States, and certainly the largest threat to the U.S. economy," she told Kroft.

Asked why people aren’t paying attention, Whitney said, "’Cause they don’t pay attention until they have to."

Whitney says it’s time to start.

California, which faces a $19 billion budget deficit next year, has a credit rating approaching junk status. It now spends more money on public employee pensions than it does on the state university system, which had to increase its tuition by 32 percent.

Arizona is so desperate it sold off the state capitol, Supreme Court building and legislative chambers to a group of investors and now leases the buildings from their new owner. The state also eliminated Medicaid funding for most organ transplants.

Then there’s New Jersey. It has the highest taxes in the country, a $10 billion deficit and a depressed economy when first-year Governor Chris Christie took office. But after looking at the books, he decided to walk away from a long-planned and much-needed project with New York and the federal government to build a rail tunnel into Manhattan. It would have helped the economy and given employment to 6,000 construction workers.

Gov. Christie acknowledged that’s a lot of jobs. "I cancelled it. I mean, listen, the bottom line is I don’t have the money. And you know what? I can’t pay people for those jobs if I don’t have the money to pay them. Where am I getting the money? I don’t have it. I literally don’t have it."
Asked if this is going on all over the country, Christie told Kroft, "Yes. Of course it is. It’s not like you can avoid it forever, ’cause it’s here now. And we all know it’s here. And the federal government doesn’t have the money to paper over it anymore, either, for the states. The day of reckoning has arrived. That’s it. And it’s gonna arrive everywhere. Timing will vary a little bit, depending upon which state you’re in, but it’s comin’."

And nowhere has the reckoning been as bad as it is in Illinois, a state that spends twice much as it collects in taxes and is unable to pay its bills.

"This is the state of affairs in Illinois. Is not pretty," Illinois state Comptroller Dan Hynes told Kroft.

Hynes is the state’s paymaster. He currently has about $5 billion in outstanding bills in his office and not enough money in the state’s coffers to pay them. He says they’re six months behind.

"How many people do you have clamoring for money?" Kroft asked.

"It’s fair to say that there are tens of thousands if not hundreds of thousands of people waiting to be paid by the state," Hynes said.
Asked how these people are getting by considering they’re not getting paid by the state, Hynes said, "Well, that’s the tragedy. People borrow money. They borrow in order to get by until the state pays them."

"They’re subsidizing the state. They’re giving the state a float," Kroft remarked.

"Exactly," Hynes agreed.

"And who do you owe that money to?" Kroft asked.

"Pretty much anybody who has any interaction with state government, we owe money to," Hynes said.

That would include everyone from the University of Illinois, which is owed $400 million, to small businessmen like Mayur Shah, who owns a pharmacy in Chicago and has been waiting months for $200,000 in Medicaid payments. Then there are the 2,000 not-for-profit organizations that are owed a billion dollars by the state.

Lutheran Social Services of Illinois has been around since 1867 and provides critical services to 70,000 people, mostly the elderly, the disabled, and the mentally ill. The state owed them $9 million just before Thanksgiving, and they nearly had to close up shop.

Asked how long his organization can go on like this, Rev. Denver Bitner, the president of Lutheran Social Services of Illinois, told Kroft, "Well, we wonder that too because we really don’t know."

He says they were forced to tap their entire line of credit and all their cash reserves before the state would finally pay them as a hardship case.
"It has to be that you’ve sold off all your assets, you have borrowed from everybody that you can borrow from, and then, we’ll think about it," Rev. Bitner explained.

And according to Bitner, that’s even though the state owes his organization the money.

"The first words out of my mouth are usually an apology, because they have been you know put in this situation, that is really unacceptable. And you know there is very little I can do or say other than apologize," Comptroller Dan Hynes said.

It’s not just the social safety net that Hynes has to worry about: there have been Illinois legislators that have been evicted from their offices because the state didn’t pay their rent, and stories about state troopers being turned away from gas stations because the owners refused to take their state credit cards.

"The state’s a deadbeat," Kroft remarked.

"Yeah. I mean, the state of Illinois is known as a deadbeat state. This is a reputation that has taken us years to earn and we’ve reached, you know, the heights of, I think, becoming the worst in the country," Hynes said.

In the early 1990s, Saskatchewan was on the verge of bankruptcy because the Grant Devine governments of 1982-1991 would not curb government spending and the deficit for a province under a million people grew to over one billion dollars.  The incoming NDP government of Roy Romanow was more pragmatist than idealistic and spent almost a decade trying to get the province on solid financial footings.  That journey was documented in the book Minding the Public Purse by the Hon. Janice MacKinnon, who was the Finance Minister during the most of the cuts.  Like I said, it was a decade of austerity.  There was funding cuts to healthcare, almost no building on the University of Saskatchewan or University of Regina campuses, a higher number of students in classrooms, longer waiting lists, rural hospitals closing, decaying highways, and it was really a lost decade.  Yes Saskatchewan did grow a bit during this time but with our financial house in disarray, growth was hard.

MacKinnon talks about how close Saskatchewan was to defaulting on it’s loans.  With the precarious state of the Canadian economy (pre-Chretien and Martin), there was some legitimate concerns that this could lead to an IMF bailout and intervention.  Luckily it never came to that but it did mean higher tuitions, higher taxes, more fees, a lot of lost opportunities that we are just now seeing as a province.

What’s scary is that the deficit numbers coming out of the U.S. states are worse and for all intents and purposes, the US economy is soon going to be in as bad or as worse shape as the Canadian economy was in the early 1990s.  I keep looking at the debt crisis that is swamping the EU economies and I can’t help but wonder until how long it is that you see places like Michigan, Illinois, and California needing massive financial bailouts.  Good grief, California has even looked at dissolving as a state and becoming a territory again (I don’t think it was a serious option).

How many lost decade will the United States go through to pay for wars in Afghanistan, Iraq, and the greed of the banks?  It took over a decade to recover from Vietnam and the state and cities economies weren’t in such tough shape.  This could either take decades or it could be the start of the long decline of the United States as a economic power.

The good news is that from Saskatchewan and Alberta’s experience is that as voters, we understood that it had to be done.  Whether it was the right wing Ralph Klein in Alberta or the centre-left Roy Romanow in Saskatchewan, we knew it had to be done and as a whole, we stood by them as they did the heavy lifting and hard cutting.  The  bad news for many states is that Saskatchewan has a natural inclination to support the NDP and Alberta has a natural inclination to vote Progressive Conservative which means that during the tough times, the provinces returned (or in Alberta’s case, they only ever elect Conservatives) what they knew and trusted during rough times.  If you don’t have you could have a series of one term administrations that moved from spend to cut to spend to cut for short term partisan advantage which could derail or destroy the entire process.  Too make spending cuts that are needed, you need a really strong majority which is not a strength of the American system which features a lot more checks and balances.

I can’t see many states turning themselves around.

Move over California, Illinois is broke as well

From The New York Times

Viw of Chicago Even by the standards of this deficit-ridden state, Illinois’s comptroller, Daniel W. Hynes, faces an ugly balance sheet. Precisely how ugly becomes clear when he beckons you into his office to examine his daily briefing memo.

He picks the papers off his desk and points to a figure in red: $5.01 billion.

“This is what the state owes right now to schools, rehabilitation centers, child care, the state university — and it’s getting worse every single day,” he says in his downtown office.

Mr. Hynes shakes his head. “This is not some esoteric budget issue; we are not paying bills for absolutely essential services,” he says. “That is obscene.”

For the last few years, California stood more or less unchallenged as a symbol of the fiscal collapse of states during the recession.

Now Illinois has shouldered to the fore, as its dysfunctional political class refuses to pay the state’s bills and refuses to take the painful steps — cuts and tax increases — to close a deficit of at least $12 billion, equal to nearly half the state’s budget.

Of course the impact is more than on just Illinois

The federal dollars are nearly spent. Last month, local governments nationwide shed more than 20,000 jobs. Should the largest struggling states — like California, New York or Illinois — lay off tens of thousands more in coming months, or default on payments, the reverberations could badly damage a weakened economy and push housing prices down still further.

“You’re not seeing these states bounce back, and that could be a big drag on the national economy,” said Susan K. Urahn of the Pew Center on the States. “It could be a very tough decade.”

Here is what it looks like in real terms

The Community Counseling Centers of Chicago is another of those workaday groups that are like the stitches on a baseball, holding together poor and working-class neighborhoods. With an annual budget of $16 million, the agency tends to families torn by crime and violence as well as people who are psychologically stressed and abusing drugs.

On any given Monday morning, the agency’s chief administrative officer, John J. Troy, 61, has no idea how he is going to keep its doors open until Friday. He said the state had not come through with an expected $2.2 million, which is about six months of arrears. He has laid off and recalled employees three times in the last two years.

“Two weeks ago, I had days to meet my $420,000 payroll and all I was looking at was a $200,000 line of credit from a bank,” recalled Mr. Troy. “I drove down to Springfield and said, ‘Hey, you owe us $3 million.’ They said: ‘Oh, that’s nothing. We owe another agency $10 million.’ ”

“The fact of the matter is,” he added, “I don’t sleep much these days.”

I know that several current and former politicians across the country read this blog but I can’t think of a Canadian equivalent.  In reading about the second Devine government in Saskatchewan the province was pretty much broke but from what I recall, bills were being paid.  While the Ontario government had Rae Days, I am pretty sure the bills got paid.  Actually outside of the 1930s, I can’t think of a time when a Canadian government didn’t pay it’s bills.  Anyone have an example?

A look back

My early ideas on Social Services were shaped by the Devine Tories.  As some of you know, the first campaign I worked on was the 1986 provincial election campaign that saw Grant Devine and the Progressive Conservatives re-elected.  Devine was confronted with a large budget deficit, an extremely effective NDP opposition party, an ongoing drought and low grain prices, declining poll numbers, as well as his own conservative ideology.  With the NDP controlling Regina and most of Saskatoon, the 1986 election split the province between urban and rural voters and Social Services became a wedge issue that was supposed to motivate Tories across the land.

Saskatchewan made some big cuts to Social Services and as Janice MacKinnon later discovered and wrote about, made Social Services into a very politicized department.  I think history will see Grant Devine as a good man who believed in Saskatchewan but was a horrible judge of character in those he appointed.  MacKinnon agreed

imageIn appointing the hyper partisan Grant Schmidt to be Minister of Social Services in his second term, the Progressive Conservatives made no effort in hiding their dislike of the “socialist” Ministry of Social Services.  The Conservatives had a weekly (or monthly… it was long time ago) fundraiser called Tory Tuesdays where a cabinet minister would come to Saskatoon and speak to the (dwindling) party faithful.  I remember listening to Deputy Premier Pat Smith and then Social Services minister Grant Schmidt rail against people on Social Services and the Ministry itself.  Janice MacKinnon quotes him in her book as saying the Ministry of Social Services spent money like a drunken sailor and said that out of “2,200 employees in the department, 1,500 were his political enemies”.  I don’t think it was a stretch to say that the Tories saw Social Services as a ministry that served an urban NDP core constituency where the Tories saw no chance for growth.  By attacking them, they also appealed to their base.

Later I was at a fundraiser for newly appointed Social Services Minister Bill Neudorf.  He joked about while he was excited to be in cabinet, how Social Services was the worst ministry in the province to have to take over in his public comments but at least he was in cabinet.

I never thought too much about it from a philosophical point of view.  Like a lot of you, I believed that Social Services should be for those that really needed the funding and was (and am) disgusted by those who are taking advantage of the system.  Our neighbour growing up was a masterful user of the system and despite being on Social Services had a much higher standard of living then we did.  The fact that she was brazen about her fraud made it a lot worse to take.  At the same time, I had no idea how hard it was on Social Services for those who are unwilling or unable to scam the system and to be honest, I had no reason to look into it.  Growing up in Lawson Heights, crime wasn’t really on anyone’s radar.  I used to walk our dog Misty along Spadina Crescent late at night through River Heights.  It was before there was street lights along the river and it was pitch dark.  Not only did I feel no fear along the walk, neither did any of the people we met.  Actually most of them carried dog treats with them (which is really odd considering who goes out with dog treats on the off chance they meet a pleasant dog while walking along a darkened part of the Meewasin Trail?).  In addition to spoiling my dog, they had no apprehension about chatting with a large college student they met.  Crime and personal safety wasn’t on any of our minds.

As far as homelessness went, my first apartment was a downtown apartment for $250/month.  I am not sure was Social Services was allowing back then but you could find $350/month apartments all over downtown.  When I look back at old documents for the Salvation Army from the 90s, the issue was not too many guys in the dorms at work but there was concerns about too few men in the facility.

When I started to work in the church, social issues were not high on my theological agenda.  The Free Methodist Church has never really engaged in social justice issues in North America, the church I had attended growing up was on the edge of McNabb Park but yet struggled to engage it consistently (although flooding it’s parking lot one winter for a skating rink was a cool idea).  While we touched on issues of poverty in ethics classes in college, it was never a local issue.  Evangelical theology is inherently individualistic and that crossed the line to me to how I saw the world (as many of you have told me over the years, I have libertarian leanings).

The first I was really challenged in this area was by Methodist theologian, Leonard Sweet in his book, A Cup of Coffee at the Soul Cafe when it talked about what it meant for kids to go school hungry.  The amount he quoted in the book was quite a bit less than I had blown at McDonald’s on my way home from work that night and for the first time, issues of poverty started to make some sense to me.  While I still saw it as an individual generosity issue, I started to question it a lot more, even though I wasn’t seeing as a societal issue.

During this time Wendy and I bought our home in Mayfair.  Mayfair was and is a core neighbourhood but like most home owners, I only saw what was happening in our neighbourhood in terms of housing values, not what was going on in the homes that call Mayfair home but even then as I saw a drug dealer selling drugs right on my street corner (the same corner my house is located on), something was going on and it wasn’t all good.

A couple of years later I was in Fullerton, lecturing at Hope International University.  I was flying out of LAX on a Sunday morning and after being trapped in Los Angeles traffic many times over the week, I left really, really early on a Sunday morning without realizing soon that I was the only one on Interstate 5.  I got to the LAX area really early and decided that I had some time to tour Watts.  It was the first time that I started to see neighbourhoods as societal narratives and my first thought was “What the hell is going on here?”.  How does one of the richest cities in the world allow Watts to happen and Watts isn’t even the worst part of Los Angeles.  I came home and started to read about Watts, Skid Row, East Hastings, and other urban areas gone wrong and started to really wonder what was happening, both in Los Angeles and in other large urban settings.  The more I realized that Saskatoon was no longer isolated from that.  Poverty, crime, violence, and life in Saskatoon were a series of interconnected issues that were becoming interconnected with my life.

Around this time I had read Thomas Homer-Dixon’s book, The Ingenuity Gap at my friend’s Karen’s insistence.  While his story is a global one, Homer-Dixon tells a story of interconnected and complex systems that are evolving in a global world.  While Thomas Friedman tells the economic version, Thomas Homer-Dixon adds environmental and complex socio-political factors to the equation.  Each one of these factors require their own specialized experts and the problem is that as the world becomes more connected, the variables overwhelm even the experts which is kind of what is happening in many cities right now.  So a new Super Wal-Mart comes to Saskatoon and increases the number of jobs by 100.  That’s a good thing right?  Well what about job losses and hour cutbacks at Confederation Mall because the anchor store isn’t there?  Well not so good right?  On the other hand there are people who are shopping locally because they can’t get to Wal-Mart on bus.  That’s good for local store owners, except now the consumers have less discretionary income.

As I later took a job at the Salvation Army Community Services in Saskatoon, I saw a complex series of factors manifesting in some pretty horrific behavior.  On my first shift I saw some very young prostitutes shooting themselves up after a night of working on the street, the next day I saw my first dial-a-dope transaction at a nearby flophouse.  A week later as I was walking home, a women started to hit me with a stick on the street as I was “her enemy”.  I was quite happy to see a beat cop as she started to hit him and I kept walking.  I started to question what I was seeing like almost every staff I have later hired.  What causes this behaviour, how do you change it, why can’t more be done?  Yet at the end of the day, I felt like I was working inside The Ingenuity Gap as the contributing interrelated factors overwhelm my (and others) ability to understand them.

As I am writing this, I am up at the lake and last night Wendy and I had coffee at our friends the Rigby’s.  John is on the board here and was talking about the decision to shut down Kinney Memorial Lodge for the winter and whether or not that was a good one.  Without giving a conclusion he mentioned a bunch of factors to consider and it made me chuckle because here you have a pretty simple question, did it make sense to close a retreat centre down when business is slowest (and probably expenses are higher) and even that has all of these variables and factors affecting the decision.  How much more complicated is what is happening to Riversdale, Pleasant, and Mayfair?

Over the next several weeks I am going to try to look at some of these factors in Saskatoon.  I needed a framework to work through this so I am going to use the programs where I work as a starting point to start the discussion and branch off from there.  I welcome your comments and if you don’t want to say anything publically, feel free to e-mail me as I don’t publish any e-mails publically here.

We need to cut back

Back during the Devine era, I listened to Grant Devine give an impassioned speech about the deficit.  The point was “yes we have a deficit but where do we cut back.  You can’t close hospitals, you can’t have crumbling highways, you can’t cut essential services”.  At the time the speech stuck with me (obviously as I remember it today) but history shows that he was wrong.

Roy Romanow came into power and closed hospitals, cut healthcare services, stopped fixing and cut back on plowing the highways and he cut services we used to think was essential in order to balance the budget.  People talk about the draconian cuts made by Ralph Klein but Romanow’s were deeper.  The unions were angry, the NDP caucus was angry, the rural municipalities were angry, the urban municipalities were angry.  No one liked the cuts.

Today Brad Wall broke a promise to the urban municipalities on revenue sharing agreements and they are understandably upset.  No one likes having money taken away from them.  My response to them is “oh well”, this is only the start.

  1. Whoever is going to fight the federal deficit will have to cut services (and probably raise taxes).  We call the transfer payments and I expect Brad Wall and other provincial premiers to be on the other end of the cutbacks.  Even for those of us who are “have” provinces, federal funding cutbacks will have to be picked up by provincial departments or the programs will end.  Money that used to be earmarked for services and tax reductions will have to be used to pay off the debt and fight the deficit.  In case you don’t know how this works, watch Till Debt Do Us Part.  It’s not going to be fun being the next finance minister, no matter which jurisdiction you are in as you will be facing cutbacks of your own and passing them down to the next level of government.  Let’s hope they don’t have a need for friends as they won’t have many.
  2. In case you haven’t noticed, the $1.56 trillion deficit proposed by Obama isn’t sustainable, look for higher interest rates to convince China to purchase American debt.  Higher interest rates will push many highly leveraged North American’s over the brink into personal bankruptcy.  That’s going to hurt earning on many consumer companies which will in turn cut back on spending and mean less tax dollars flowing around.
  3. If many economists are correct, oil prices will rise (and are rising) as we crawl out of this recession.  As we do that, higher oil prices will push us back down again.  This morning I was listening to an economist call this the “new normal”.  In Saskatchewan we are a commodity based economy which means that we will forever be riding the wave of potash, wheat, natural gas, and oil revenues.

I would hope for a better level of political discourse then what we saw when Romanow’s government made his cuts.  There really is no concept of we are in all of this together, which of course we are.  I know lobbying the government is an important part of the job but in the end let’s accept that this is going to get worse before it gets better.  Of course that isn’t going to happen so brace yourself for political stunts designed at short term gain over long term stability.  Grant Devine’s legacy will probably live again.

Update: Sean Shaw has a look at what this cutback will mean for the city.

Deficits are Devine

Well it’s official, deficit financing on the scale not seen since the Devine era is back in Saskatchewan.  The government of Saskatchewan is going to run a billion dollar deficit this year based on the fall of potash prices.  As told by the Star Phoenix.

The release of the government’s mid-year financial report Thursday shows it now projecting it will take in only $109 million from potash royalties and taxes – $1.8 billion below what it forecast in its spring budget.

The government is now spending more than it is taking in, even with higher-than-expected oil royalties, tax revenues and federal transfers.

That has required a drawdown from the reserve Growth and Financial Security Fund of $564.3 million and a special dividend from Crown Investments Corp. of $460 million from the sale of the government’s share of SaskFerco.

However on a summary basis – which includes all of the operations of government including the Crowns – a deficit projected at $25 million at budget is now pegged at $1.05 billion.

The NDP were all over this today.  I’ll link to Cam Broten’s website who posted the NDP press release and response to the deficit.

I liked how it started.

With the release of the Mid-Year Financial Report, NDP Finance critic Trent Wotherspoon said the Wall government has confirmed that it is responsible for the biggest example of fiscal incompetence in the history of Saskatchewan. He said the combination of grossly inflated potash revenue projections, equity stripping from Crown Corporations, and out-of-control government spending has left the province with a $1 Billion deficit on a summary financial basis and a financial blunder not seen in generations.

“Private forecasters, industry representatives, and the NDP Opposition all cautioned against the fantasyland numbers the Wall government put forward in its budget,” Wotherspoon said. “But cheerleading and popular promises ruled the day with no thought as to whether or not the expert advice it received should have been taken into account.”

Then it gets a bit weird as it moves for attacking “out of control spending” and attacks spending cuts.

Wotherspoon said the Wall government’s fiscal mismanagement isn’t just about numbers on a page; people are being asked to pay for its incompetence through cuts to healthcare, education, rural programs, and their quality in life in general. He noted that among the cuts was $122 million from the construction of long-term care facilities in rural Saskatchewan and $32 million from new school infrastructure.

So on one hand the NDP are criticizing the Sask. Party for running a huge deficit (which they should) while at the other hand trying to get upset or cutting spending to keep government spending under control.

I have friends and I respect people in both parties and here is my advice on to handle the situation.

Saskatchewan Party: You missed your revenue predictions by $1.8 billion dollars.  I would fire whoever made that prediction because I agree with the NDP on this one, when you came out with this budget, you must have known it was going to be a bad year for potash prices.  Even I knew it was going to be a bad year for commodity prices going into a global recession.  To keep this from happening again, I would come up with an independent office of economic forecasters that would give guidance to the government that were outside the Ministry of Finance and therefore outside the influence of the political pressures that lead to really bad budget forecasting.  Don’t go half-way with this.  Give it legitimacy, give it some independence, and fund it properly.  I am not an economist but I know many of them have ideological bents on how the world is going to pan out and that is natural.  Even the best economists are also going to make mistakes.  I can accept that (not $1.8 billion dollar mistakes but some mistakes).   What I want to see as a voter and a taxpayer is a process in budget forcasting that is non-partisan and transparent.  This would go a long way in restoring some confidence in your budget predictions which have been questioned by the media for over a year. If you want us to trust you again, you need to take some steps to ensure you don’t miss your targets again.  Again, as a Saskatchewan voter and taxpayer I want to hear what your plan is to pay back your billion dollar boondoggle sooner rather than later.  It’s a lot of money and you are going to take a beating in the press and in the Legislature but it’s better to deal with it up front and head on and then move on then play political games with it.  Dealing with it this way will hopefully stop the comparisons to the Devine Tories of the 1980s.

Also, potash prices didn’t just fall last week.  I know you a governing party doesn’t want to give negative financial updates every month but it seems prudent during a time of unstable financial times to offer a more transparent accounting of the public purse in regards how we are doing compared to our predictions.

NDP: Maybe they should not use the same press release to attack out of control spending and then attacking spending cuts.  Use two pieces of paper and maybe send out two different press releases.  Despite not liking the wording and structure of their release, the NDP have the high ground here, as they are the ones that slayed the deficit that last time.  If I was the NDP, I would have a reunion luncheon with Roy Romanow, Janice MacKinnon, Eric Cline, and others who had to go through year after year of budget cuts to talk about how hard it was and the consequences of deficit financing in the Devine years had on the 1990s in Saskatchewan.  While you are at it, give out a lot of copies of Minding the Public Purse to remind us again how hard it was to make those cutbacks as a government but also to remind us voters how hard it was to see things we care about in Saskatchewan to be cut.  If I was Trent Wotherspoon, I would also use the term “billion dollar boondoggle” a lot in the days ahead but that is just me.  Boondoggle is such a great word.

For both parties, I would love to see a real debate on their visions for the future.  A future that involves peak oil, a liquidity crisis turning into a long term government debt crisis, a future where our federal government seems destined to burden all of us with long term debt (again), higher interest rates, cut transfer payments, and potentially higher unemployment.   Are we going to grow ourselves out of this mess (doubtful) or make drastic spending cuts?  Will we see a higher PST and income tax rates in our future?  Will the burden be put on businesses or individuals or will someone come up with a new path to take?  Tough times are ahead and it would be refreshing to hear the vision of both major parties in Saskatchewan (and for that matter, I would like to hear the Liberal Party vision as well) about the role of Saskatchewan in a smaller, less affluent world will look like.

GigaText 2.0

Long time Tories in Saskatchewan still cringe at the name but it actually looks like Google has done what the Devine Tories and GigaText could not, provide an accurate and automated translation from French to English or English to French.  Too late to save Grant Devine’s political career though.  Timing is everything.