Thursday, April 23, 2009

Risky Business

As the questions surrounding Reynolds' conduct widen, it is important to place this burgeoning scandal in context. Coincidentally, this morning the Tely returned to ABC in its editorial:

The Tely focuses on the question of revenge and the costs of ABC: "Now, you can say that governments shouldn't hold grudges, and shouldn't make decisions based on politics or differences in personalities. You'd be right. On the other hand, all of them - even our near and dear provincial government - do. So it probably should not be a surprise when it turns out that "Steve's government" actually has a long memory. Or that ABC may end up having ramifications throughout its tenure."

Fair enough, but there are 3 issues that demand further attention:

1) These ramifications were well known from the beginning of the ABC folly. Anyone even remotely aware of federal politics knew when the last federal election was called that it was highly unlikely that Harper would lose. The polls wavered from majority to minority status, but the prospect of defeating Harper was very remote from the beginning.

2) As for the difference between a minority and majority government, by DW's own admission Harper had shown that he was more than capable of doing what he wanted with a minority government. If Harper had already shafted NL when he had a minority government prior to 2008, then why would anyone expect that keeping him from a majority government would somehow alter his position towards NL?

3) As DW himself said repeatedly, Harper is a vindictive, nasty politician. So if the chances of defeating him in a federal election were known to be so slim, why would DW be proposing to launch a rhetorical nuclear weapon? Unless there was a realistic chance that Harper could be defeated, it made no political sense to torch the last plank in the bridge between St. John's and Ottawa, leaving NL with no representation at the federal cabinet. (And it needs to be noted that having no MP from NL serves Harper's interests more than anyone else's).

The Tely editorial also serves as a useful reminder of DW's infamous speech which, as they point out, "many in this province might remember, if for no other reason than the slightly bizarre appearance of a sign-waving Buddy the Puffin."

So let's return to the actual speech. Below is the passage where DW attacks Harper:

"Stephen Harper’s own campaign literature proclaimed, "There is no greater fraud than a promise not kept." He used these words as he successfully attempted to woo voters from this province to not vote for the opposing party. Naively we trusted him. He rewarded that trust with a broken promise. According to his own brochure – he is a fraud. I think you all know my views on this issue and I firmly believe that Newfoundlanders and Labradorians at home and abroad still feel the same cold, sharp sting of betrayal at the hands of our country’s leader. Other commitments were also made by Stephen Harper that were not kept. 5-Wing Goose Bay; custodial management; a Lower Churchill guarantee and numerous others. We all know that these promises are sadly not worth the paper they were written on and the bond of his word is meaningless. The raising of rates at Marine Atlantic in times of high gas prices, poor service and inaction on badly needed vessels is another example of their attitude to isolate the island and which creates more economic hardship on small rural businesses. American actress, Katherine Hepburn, once said, "To keep your character intact you cannot stoop to filthy acts. It makes it easier to stoop the next time". I believe these words hold a dire warning for all Canadians. If Harper is prepared to slash program spending with large surpluses and break his written word as the leader of a minority government, the future for Newfoundlanders and Labradorians, and indeed all Canadians, will be very bleak under a Conservative majority. Do not let Stephen Harper turn your focus onto a green shift in his attempt to turn your focus away from the Conservative’s blue shaft. His list of broken and unfulfilled promises portrays a lack of integrity in his character and shows us he cannot be trusted. This is a federal government willing to not only break their own promises, but they go so far as to break their own laws and call an election even though they mandated fixed election dates. There is nothing Harper will not do to win a majority government. This is a party who purportedly offered a terminally ill MP a life insurance policy to get his vote. How low can you go? This is a man who wants an election before losing by-elections that were to have taken place this month. A man who wants an election before the economy declines any further due to fiscal mismanagement. He wants an election before findings are released on various ethical breaches against his government. It is so critically important that the people of Newfoundland and Labrador let Stephen Harper know that his treatment, his attitude, his indifference to this province is NOT acceptable. When I met with him to offer a compromise he told me face-to-face that he does not need the people of this province to win an election. So, let’s let him know that we don’t need him either."

Stop for a minute and reflect on what DW actually said. Consider the seriousness of the accusations and the nastiness of the insults.

I'm not suggesting for a second that you have sympathy for Harper, but just stop and reflect on what he's calling the prime minister. DW's speech was singularly visceral, vitriolic, and vindictive.

Think about the stakes. This was no ordinary speech. It was made on the eve of a federal election which everyone knew that the target of that vitriol was going to win.

Whatever your political views, one thing cannot be doubted: this was an incredibly risky move. DW was taking a huge political gamble. He was rolling the dice in a high stakes game of chicken.

But there were two problems with this game: 1) he was gambling with the public's money, not his own; 2) the odds were stacked so high against him that it's hard to believe that this speech was really about whether Harper won a minority or a majority government.

The two lines in italics get the closest to what was really going on here. Harper allegedly said that he didn't need NL to win a federal election. That's an incredibly nasty and dismissive thing for a prime minister to say, but in terms of pure, Machiavellian politics, it was true: he won the election without any MPs from NL, and he's governing the country today without any MPs from NL.

DW's response was, essentially, screw you! If you dismiss us, we'll dismiss you. That may work well on the playground, but federal-provincial relations is an entirely different matter. Last month, Orwellian News reflected on the options DW had before him:

Imagine that you're in charge of a regional office in a much larger corporation. Your boss is a jerk and you hate him, but you have to work with him nonetheless. You may despise the little creep, but you have to work with him to ensure that your regional office gets its fair share of funding and support. So what's the best way to achieve your goals?

You could throw a fit during a meeting, froth at the mouth, call him every name in the book, and launch a scorched-earth war against him. You could do this right away, before you have lined up sufficient support from the other regional offices, and while your boss is in a relatively strong position.

Alternately, you could smile when he jerks you around, bide your time, keep him in the dark, and maximize your short-term position while you pursue your long-term goal of removing him. You could wait for the right moment to act decisely when conditions are ripe for success. I leave it to you to decide which tactic is the dumb one.

But, in retrospect, I think dumbness explains only part of the puzzle. Another important part is recklessness: Dangovt seems addicted to risky behaviour and unnecessary brinksmanship.

Whether it's meddling with the MUN presidential search, antagonizing the nurses, or allowing Wiseman to remain in cabinet, Dangovt has shown a consistent pattern of recklessness.

This recklessness gets sold to the public in various guises -- passion, pride, patiotism, optimism, determination -- but let's not lose sight that it is, in the end, risky business.

And that's how we got to the latest scandal.

If the past is any guide, it's only a matter of time before Dangovt takes another big political risk that will distract the public's attention from Reynolds' inaction and the fallout from Byrne's conviction.

Psychological Update
If you're curious about the psychology behind such recklessness, then you may be interested in John Lanchester's take:

"One of the peculiar things about the world of finance is that it freely offers the sensation of being proved right to its participants. Every transaction in the markets has a buyer and a seller, and, in most cases, one of them is right and the other wrong, because the price goes either up or down. The cumulative weight of this right-or-wrongness is one of the things that make financial types psychologically distinctive. Artists, sportsmen, surgeons, plumbers, and the rest of us have secret voices of doubt, inner reservations about ourselves, but if you go to work with money, and make money, you can be proved right in the most inhumanly pure way. This is why people who have succeeded in the world of money tend to have such a high opinion of themselves. And this is why they seem to regard themselves as paragons of rationality, while others often regard them as slightly nuts. The chairman and C.E.O. of Lehman Brothers, Richard Fuld, in his no-apologies testimony to a congressional committee after his company’s collapse, gave us a glimpse of this state of mind in its full pomp.

This is also why the financial masters of the universe tend not to write books. If you have been proved—proved—right, why bother? If you need to tell it, you can’t truly know it. The story of David Einhorn and Allied Capital is an example of a moneyman who believed, with absolute certainty, that he was in the right, who said so, and who then watched the world fail to react to his irrefutable demonstration of his own rightness. This drove him so crazy that he did what was, for a hedge-fund manager, a bizarre thing: he wrote a book about it."

For the rest of the article, see

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