The provincial government has been on its current course since about 2007.
There were three elements to the Conservatives agenda under Danny Williams. They changed somewhat over time but these are the elements that dominated from 2003 to 2015.
Above all else, Williams’ goal was to build the Lower Churchill. That was to be his one, lasting accomplishment. Williams would build what no one else had been able to build. While it was rationalised as a provincial project with lasting significance, the way it finally rolled out confirmed the extent to which the Lower Churchill was intensely personal.
To build the Lower Churchill, Williams would turn Newfoundland and Labrador Hydro into an energy corporation to rival Hydro-Quebec. And to help fund it, Williams would acquire so-called equity stakes in offshore projects.
The second element of Williams’ agenda was political hegemony. It would take him three years to get rid of his internal rivals or neutralise them. His external rivals disappeared in the 2007 general election. Williams and the Conservatives accomplished this goal several ways, not the least of which was his effort to control information from government. That’s poll goosing and his restrictions on public access to government information.
For our purposes, though, the key element of hegemony was the roll played by public spending. Spending was a means to secure political support. The message was reinforced by the way the Conservatives made announcements in public and quiet openly tied spending to political support in a return to a very open yet very old-fashioned system of patronage.
Spending also became a substitute for other policies. While the Conservatives had a fairly well-developed section of their 2003 platform committed to economic development and diversification, in power, the Conservatives spent money. The Conservatives spent money to the extent they had it initially to buy back public support lost in 2004’s cuts and freeze. They spent public money to substitute for loss of private sector jobs in the fishery in places like Hermitage or in forestry in places like Stephenville.
After Williams secured internal hegemony, that is, within his party, Williams and his close associates like Tom Marshall spent money to secure political dominance externally by winning all the seats in the House of Assembly in the 2007 general election. They didn’t achieve that goal but they achieved the goal of silencing any political opposition to their agenda.
The third element provided the fuel for the second element of the agenda, namely spending. Oil money became the fuel for the spending program once prices climbed to insane heights coinciding very fortunately for the Conservatives with peak oil production in the local offshore.
But oil wasn’t always going to be the rocket fuel that took Danny Williams’ popularity to stellar levels. The Conservative agenda was originally driven by more federal money. The closer Newfoundland and Labrador got to being a financially self-reliant province, the more some policy advocates tried to find new ways of keeping the province dependent on federal transfers. They created the fiction that the federal government was taking provincial oil royalties, effectively breaking the 1984 Atlantic Accord. The fiction was a key part of Vic Young’s Blame Canada commission appointed by the Liberals under Roger Grimes but used by Danny Williams and the Conservatives as an integral part of their platform. It offered a litany of all the old nationalist grievances and Williams’ long experience as an n accident injury lawyer taught him how to exploit victimhood for financial gain. It was a match made in heaven.
Except for one small problem.
The federal government isn’t an insurance company. Neither the politicians nor the bureaucrats were truly susceptible to Williams’ tactic of trying to cause the maximum amount of superficial pain so that the insurer will offer a sufficiently hefty “frig-off” payment.
Williams famously said that every principle converts to cash. It was his core operating principle in politics. And that was certainly true. He sold his principle on the offshore for a tiny fraction of what it would have been worth. The thing is, Williams’ cynical statement really admitted that there were no principles. There was only cash.
Williams lost badly in his first effort to extort money from the federal government. He convinced the punters in his own province he’d won but the record is clear. The federal government offered him a fixed pot of cash for a limited period. The federal government did not waiver in its position. Williams grew increasingly hysterical in his words and actions in public but continued to negotiate on the basis of the federal offer he initially rejected in May 2004.
Ultimately, Williams failed. He took what the federal government offered. There were two key differences in the deal Williams rejected in October and the one he signed in January 2005. The most important one is that he lost the possibility of a renewal of the agreement after eight years. The other was that the federal one-time cheque increased slightly. The difference in the cash value was based solely on what price of oil they used to calculate the value of the deal from 2005 until the point they expected the province would no longer qualify for Equalization.
That didn’t stop Williams from persisting with efforts to get more money from Ottawa. He carried on through the subsequent Equalization talks but even his celebrated promise to campaign across Canada to defeat Stephen Harper turned out to be a lot less than promised. Williams limited his efforts to Newfoundland and Labrador, as the federal Conservatives went on to win re-election and, subsequently, a majority government.
The failure to get extra federal cash didn’t affect the Conservative spending agenda, though. Through to 2015, the Conservatives nearly doubled public spending. They increased the size of the public service by 33% between 2005 and 2011. They financed it initially with oil money but later resorted to larger and larger rounds of borrowing, whether for core government operations or for Muskrat Falls.
Danny Williams left the premier’s job in 2010 but the Conservatives continued on the same policy trajectory. That’s because both Williams and the group around him continued to dominate the party until the end. There were some signs of change. New politicians elected in 2011 championed a different approach to European trade talks, for example. Some of their dispute with Kathy Dunderdale and the Old Hands spilled out into public, but ultimately the Hold Man and his ways triumphed.
The Coleman Fiasco confirmed that Williams was still in control of the party, though. Even Paul Davis, newly elected leader in the wake of Williams’ Coleman fiasco, couldn’t escape the inertia of a decade and Williams. Davis tried the same ham-fisted negotiating tactics
on the European trade deal Danny Williams had worn out a decade earlier. Davis failed just as Williams had failed. Davis’ failure might even have been worse because even as he lost strategically, Williams at least at a couple of billion dollars to soothe his bruised ego. It was a fitting end to the Conservative term since it confirmed that a decade later ideas that hadn’t worked before still didn’t work.
Some respects, though, the faint glimmers of a spark of life in the Conservative party under Paul Davis were like the signs of life in the party under Danny Williams before Williams got rid of any sources of new ideas. The government put Doug House
to work in 2006, for example, with the task of creating a new economic development scheme for the province. He and his work simply vanished, just as the Sustainable Development Act
disappeared the following year. Danny Williams was only interested in one thing. Everything else – like the fishery or economic development policy – just carried on the same stagnant course.
. . . → Read More: The Sir Robert Bond Papers: Policy Stagnation #nlpoli