The Herald, in a bracing throwback to its days as the fusty Old Lady of Argyle, approved the eviction in every detail: violence, secrecy, sneakiness, double-dealing, rights-violation, and even Remembrance Day timing. AllNS tried to have it both ways. A commentary* by former-Managing-Editor-turned-United-Church-minister Kevin Cox quibbled with Kelly’s timing and secretive decision-making, but endorsed His Worship’s position that a vague and rarely enforced municipal bylaw should trump Sections 2. (b), (c), and (d) of the Canadian Charter of Rights and Freedoms.

In a letter AllNS published this morning, Halifax Filmmaker John Wesley Chisholm pointed out that Calgary Mayor Naheed Nenshi had reached the opposite conclusion, “saying the Charter of Rights prevented the city from arbitrarily forcing out the protesters — even if they’re breaking a city bylaw.”

Halifax officials, Chisholm wrote, took a big gamble with taxpayers’ money, risking hundreds of thousands and perhaps millions on a possible court defence of

the notion that these protesters’ use of tents to camp out in a public park was so egregious, so outstandingly shocking to our community’s values, of such a danger to public safety, so offensive to our public interests, that it justified a police action to deny their rights and freedoms to assembly and protest under the federal law on which our civil society is based..

Even by the smug standards of Halifax’s establishment media, this was a shabby performance.

*Access to AllNS is by paid subscription, and its flash-based web structure makes it impossible to post accurate links.

A sophisticated lobby by the province’s paving contractors appears to have hornswoggled the Halifax media.

Correction: the lobby isn’t all that sophisticated. Half an hour’s research would have debunked the contractors’ claim that socialist ideology trumped common sense in government’s decision to buy and run its own paving plant.

In various forums, the road-builders have argued the province can’t possibly pave roads cheaper than they can. There’s but one problem with this argument: No one disagrees.

The question isn’t how cheaply the the private sector could pave Nova Scotia highways. The question is whether government tenders for paving work are eliciting competitive bids. The evidence, available on the Transportation and Infrastructure Renewal website, shows they are not.

In the 2008 and 2009 construction seasons, 72 paving tenders drew only two bids. Ten tenders drew only one bid. A report [pdf]  prepared for the province’s Chief Engineer for Highway Programs, shows paving projects in counties where bidding is competitive drew an average asphalt price of  $49.02 per tonne, while tenders in non-competitive counties drew average bids of $54.91 — a 9.7 percent premium.

In some parts of the province, the problem was extreme. A tender in Yarmouth produced a low bid of $64.50. One in Digby yielded $79.20 per tonne.

The paving industry in Nova Scotia consists of a single 500-pound gorilla — Halifax-based Dexter Construction — and several local outfits scattered around the outback. The small, family-owned shops may be loathe to bid on projects in Metro, lest the gorilla retaliate by muscling in on their own home turf. Some say this happened a few years ago, and nearly put a local contractor under.

No doubt all these companies could pave cheaper than government. The question is what will it take to get them to do so. We have a crappy climate for pavement, and a lot of roads to maintain. If the province wants to get the best value for its paving dollar, having a plant in its hip pocket might be just the ticket. The Canadian Taxpayers’ Federation, of all groups, ought to be able to understand that.

By any measure, dredging Sydney Harbour is a dubious use of public funds. It may yield modest increases in commercial shipping, but dreams of a container terminal here are but a fantasy. Despite the massive boom in world shipping that characterized the 2000s, the two container piers in Halifax continue to limp along at half capacity. Plans for a third pier at Melford are years ahead of those for Sydney, where a putative terminal proponent seems to have vanished.

Yet the Cape Breton public has been massively oversold on the concept as the only possible salvation of Cape Breton’s economic future, to the point it has become a political sacred cow, and anyone who opposes it a Judas.

This is the worst possible message for Cape Bretoners: to promise a single, steel-plant-scale silver bullet to solve our problems — with the silver furnished by federal and provincial taxpayers, of course. Most area politicians and business leaders recognize this campaign as a cynical fraud, but the political momentum behind the concept is such that none dare speak against it.

New Dems want to protect their slender Cape Breton base in an election that promises to be much more difficult than the one that catapulted them to power. Liberals don’t want to give the other parties an edge in that election. Cecil Clarke wants to give his campaign for Parliament a boost.

Clarke cannot beat MP Mark Eyking in a federal contest. No one running on a Harper ticket could, and Clarke barely held his own provincial seat last year. Clarke will lose, but will he also win by losing? Insiders quietly ask what federal plum Harper and Peter MacKay have dangled to induce him to run.

On the steps of Province House last evening, a New Democrat MLA offered a chilling prediction: Clarke will be Nova Scotia’s next Lieutenant Governour, when the incumbent’s term expires next year. At a cost of $38 million in matching federal-provincial tax dollars.

Where is Dennis Ryan when you need him?

Or not.

The lawsuit was cynical ploy by a mayor who likes to posture as a scrapper for the little guy, but refuses to do the hard work needed to reach political solutions to the little guy’s problems.

• Contrary to popular belief, even a total victory for CBRM would not have brought the municipality a single dime. It didn’t even ask for money.
• In any case, the lawsuit had no chance of success. Aside from Mayor John Morgan and his pricey Toronto constitutional lawyer, Contrarian has been unable to find a single lawyer who thought it had any chance of success.
• Although the case suffered a mercifully early death—it was thrown out before trial—the mayor’s insistence on appealing to the highest court in the land frittered away at least $500,000 in legal bills, and wasted three five years that could better have been spent seeking a political solution. During that time, CBRM ran up another $60 million $100 million in debt its citizens cannot afford.
• The mayor now says he will seek a political solution, but he is playing a weaker hand, having demonstrated that his constitutional claims lack legal validity.

I believe the municipality has a case for greater provincial assistance in meeting basic service needs. I hope the Dexter Government, financially strapped as it is, gives the problem a fair hearing. But the mayor’s legal adventure not only delayed a solution, it encouraged the worst impulses of Cape Breton’s culture of dependency, and it reinforced the rest of the world’s weary stereotype of Cape Bretoners as people with their hands out. In all these respects, it did a disservice to the very citizens Morgan claims to champion.

Elaboration after the jump.

Just how weak was the mayor’s case?

Nova Scotia courts are traditionally loathe to throw out cases before trial. They operate on the assumption that every litigant deserves his day in court. To throw out CBRM’s case before trial, Mr. Justice John Murphy had to assume that all the facts alleged by municipality were true. Then he had to determine that, even so, the suit was “certain to fail” because it contained “a radical defect.” He had to decide that it was ”on its face… absolutely unsustainable.” He had to conclude that it had “no chance of succeeding.”

That’s exactly what he concluded. The Nova Scotia Court of Appeal unanimously upheld his decision. The Supreme Court of Canada declined to hear a further appeal. In the annals of weak cases, this was a trifecta.

Mayor Morgan’s reaction? He accused Judge Murphy, and Nova Scotia judges generally, of political bias. (With typical recklessness, he accused Murphy, a Liberal appointee, of bias in favor of the Conservatives.)

Why was Morgan’s case so weak?

CBRM’s case rested on an absurd leap of logic. CBRM contended that the Equalization provision of Canada’s constitution require the province to provide greater financial support to CBRM.

Let’s look at the equalization provision, Section 36 of the Constitution Act. It commits the government of Canada “to the principle of making equalization payments to ensure that provincial governments have sufficient revenues to provide reasonably comparable levels of public services at reasonably comparable levels of taxation.”

It commits the federal government to a principle. It doesn’t commit the provinces to anything, and it doesn’t even mention municipalities.

Had the case succeeded, what would CBRM have won?

Not a nickle. The lawsuit did not seek debt relief. It did not ask additional funding. It asked only for “a declaration that the Government of Nova Scotia has not complied with its commitments under s.36 of the Constitution Act.”

The suit didn’t even ask the court to determine what Nova Scotia’s constitutional commitment means. It didn’t ask the court to tell the province what it must do to fulfill its obligations. It did not challenge the constitutionality or the validity of the Municipal Grants Act or any other act of the Nova Scotia legislature. All is asked was a declaration that the province is not in compliance with the constitution. That’s all Morgan could have won had the case succeeded.

It failed.

I’m amazed that a man who has been mayor, i.e., in the higher echelons of the establishment, for what? ten years? can still get away with being considered anti-establishment.

That’s how the Liberal Party of Nova Scotia obtained the money it would be blocked from using by a government bill introduced in the legislature Tuesday. Liberal leader Stephen McNeil should think hard before crying victim.

Justice Minister Ross Landry, who introduced the bill, suggested the Liberals give the tainted funds to charity. A better idea would be to give it back to the provincial treasury, because that’s who they stole it from.

McNeil may think voters’ memories are too short to remember the details, but a few of us old coots are still around to remind them.

The money in question came from two ‘trust’ accounts, the Hawco and Howmur Funds. They came to light in the 1983 influence-peddling trial of three Nova Scotia Liberal Party fundraisers, Sen. Augustus Irvine Barrow, Clarence MacFadden, and the colorfully named James G. “Suitcase” Simpson.

The three bagmen oversaw a Liberal Party toll-gating scheme from 1970 to 1978, while Gerald Regan was premier. As the Supreme Court of Canada (R. v. Barrow, [1987] 2 S.C.R. 694) described it:

In October of 1970, the liberal party defeated the then Government of Nova Scotia in a general election and formed the new government which held power until 1978. During the period from 1970 to 1978, the Committee collected contributions amounting in total to $3,836,468.13, of which $2,770,773.52 was deposited in one bank account and $1,065,694.61 in the other. A police investigation commenced in the autumn of 1978 resulted in the seizure of many documents from government departments and agencies and also from several wineries, distilleries and other corporations. The evidence revealed that the contributions made by liquor and wine companies dealing with the government were based on a fixed amount per case of products sold to the Government. Other companies doing business with the government paid a percentage of monies they received from government work which ranged from three to five per cent.

Simpson plead guilty and paid a $75,000 fine. MacFadden and Barrow were found guilty at trial; MacFadden paid a $25,000 fine, but Barrow, for whom conviction would have meant expulsion from the Senate, appealed and won a new trial on a technicality. He was acquitted at a second trial.

At the first trial, Hugh Rynard, president of Acres Consulting Services Ltd., testified:

One of my functions was to insure that we as a company did whatever was necessary to improve our ability both in obtaining work and in execution of our work. And I was told that it would be in order for me to seek an appointment with Mr. Barrow.

Rynard and Barrow met on March 7, 1973 so Rynard could pitch the bagman on the company’s expertise. According to Rynard’s undisputed testimony, Barrow:

told me during that conversation that we would be expected to pay from three percent to five percent of the fees generated from Provincial Government work to the  . . . into the coffers of the Liberal Party.

For years, the Liberal Party used interest off these secret funds to finance campaigns and, in at least one notorious example, to pay a secret salary to Liberal leader Vince MacLean.

The funds returned to the public spotlight in the early nineties, thanks to late George Hawkins, a courageous Liberal who spent years trying to convince fellow Party members to give up their ill-gotten gains, and apologize for taking them in the first place. “Since the beginning of the Regan administration,” Hawkins said, “the Liberal Party… has been living… from the proceeds of crime.”

Even before the Barrow-MacFadden trial, Hawkins knew the source of the money because, ironically, his father, a Liberal stalwart, had set up one of the funds. There is little doubt that Nova Scotia Conservatives carried out similar shakedowns during the Robert Stanfield and G.I. Smith administrations, but the party’s financial records were destroyed in a mysterious fire around the time the RCMP began making inquiries.

Thanks to pressure from Hawkins, the Liberal Party eventually agreed to audit the funds, and relinquish to the province any money that proved tainted. But as Kings College Journalism prof. Steven Kimber recounts, the party’s actions fell short of this promise:

After another year of obfuscating, the party released its so-called “audit,” which wasn’t. Instead, the auditors, “as specifically agreed,” only perused the actual trial transcript and identified $1,287,473.14 “proven or alleged to have been obtained” through kickbacks. “This procedure,” the auditors noted dryly, “does not constitute an audit.”

Liberal House Leader Manning MacDonald likes to pretend the funds were “cleansed many years ago” through this process, but this is malarkey. Most, if not all of the money that remains in the funds was stolen from the taxpayers of Nova Scotia.

Steven McNeil has a decision to make. Will he continue the long tradition of lying about the source of this money? Or will he support Bill 44, a measure that would finally put this sordid chapter of our history to rest?

So even as two of the Dexter government’s promises (keeping all rural emergency rooms open and using tax rebates to encourage electricity consumption) make me shudder, I can’t help but admire Dexter’s determination to implement them.

Contrarian’s friend Mike Targett suggests a way out of this self-set trap:

While the NDP’s home insulation & energy-efficiency improvement program for low-income earners is a good idea, the electricity rebate is an inefficient fossil fuel subsidy that will likely encourage wasteful consumption precisely because it is not targeted at those in need.

Here’s my idea: those on one side of the wage gap donate their rebate to a fund that feeds into the energy-efficiency program for low-incomers. This fund could be set up by a charity or the province itself. If only 6 or 7 thousand people did this, it would double the program’s current budget.

How about it, Darrell?

On the debate over the Wark Principle, Targett adds:

Home-heat is a necessity; carbon emissions are not. A carbon tax (exempt low-incomers) would fund renewable energy development in order to decouple energy from carbon. Of course, as we’ve seen, it can’t be called a tax. Since averting climate catastrophe ensures a livable future for our children and grandchildren, we could just call it an RFSP: Registered Future Saving Plan.

You don’t tax necessities, then ask poor people to apply for rebates. That’s why we don’t tax groceries. How is electricity any different?

Contrarian reader Martin MacKinnon thinks Wark’s objection to taxing necessities is ill-considered:

There are indeed far too many Nova Scotians who can ill afford the necessities of life. However, why should the rest of us benefit from their poverty? Wark seems to miss an important point. If those of us (including Wark and I) who could well afford to, do not pay tax on power, then governments who need to pay for things like health care and education will have to collect those taxes elsewhere. We need tax breaks for the necessities of life to be targeted at those who need help, not at the rest of us who don’t.

After the jump, a more vehement reader, and a factual correction.

Jonathan Dursi is less tactful:

Wark wrote: “You’re forgetting about an important and well-established principle. Governments should not tax necessities.” Well, that’s a pretty crap principle, isn’t it?

The problem the poor and disadvantaged have is not that heating oil is taxed; it’s that they’re poor.  And disadvantaged. You approach that problem by giving those people money, and training, and other opportunities to re-advantage themselves—not by screwing up your energy, transportation, and climate policies to try to bend them into anti-poverty policies.

Good principles would be:

• We’ll help the poor and disadvantaged live in dignity and have opportunities to better their lot; and
• We’ll work toward policies that reduce our carbon emissions and other pollutants.

A principle of  let’s make fossil fuels as cheap as possible, so everyone can afford as much as they want helps only tiny amounts on one policy front, while actively undermining the other.

Unfortunately, this principle is held, genuinely or otherwise, by lots of well meaning people.   No one wants to see families who are already struggling to make ends meet have a hard time heating their home in the winter.  And political parties who fight to keep prices low for those unlucky few get to be the hero and reap the rewards by also giving their middle- and upper-middle class constituents the same stuff for cheap.

But that inevitably leads to both underinvestment in whatever you’re giving away, since there’s now no revenue stream for it, and overuse and wasteful use, since it’s cheap and plentiful.   Most big Canadian cities have power systems, water distribution systems, and transportation systems that are crumbling because of exactly this “principle.”

Charge what needs to be charged for goods and services; tax what needs to be taxed.  Canadian families with low incomes need income, not bad policy.

Finally, a reader complains that both Wark and Contrarian have mischaracterized the tax relief for home electricity. Quoting Wark:

Under NDP pressure, the Tories removed the provincial sales taxes on all home heating fuels. But later, they restored the tax on electricity.

The reader points out:

This is in fact incorrect, but rarely acknowleged, even by the Contrarian.  Electricity deemed to be used for home heating (time of year, more than 27.4 kwh per day) did not carry the provincial portion of the HST.

From the Access Nova Scotia web site: “Until September 30, 2009, only electricity that exceeded a threshold of 27.4 kilowatt hours per day times the number of days before October 1, 2009 on the bill is eligible for the rebate. The base charge was not eligible for the rebate”

The debate over the “subsidy” applies to the portion that was taxed, i.e. all use during summer (hot-tubs) and the portion below 27.4 kw-h per day.

Note that the base charge is not being rebated by the new government, therefore the maximum theoretical household benefit under the NDP plan is 27.4 kwh times $0.11796/kwh times 0.08 times 30 (days) = $7.76 per month. Not many folks without hot-tubs would hit 27.4 kw-h per day in the summer, thus lowering the average rebate during that period.

It is also forgotten that the NDP election promise was to “remove HST from home energy”.  HST is 13%, not 8%.  If energy is an essential service like groceries, then it would carry the same tax exemption/rebate (13% HST, not 8% provincial component of HST).

But the issues keep coming, whether government’s ready to act or not. The risk of Dexter’s approach is that ministers may fall into reactive mode, moving from crisis to crisis rather than driving the new government’s policy agenda.

We have already seen Health Minister Maureen MacDonald struggling with the discovery that she cannot wish away the problem of rural emergency room closures, as she and the party assured voters they could during the election. (More on this soon.)

Today, the government faces an alarming report from Auditor General Jacques LaPointe sharply critical of the province’s readiness to deal with the unfolding H1N1 epidemic. He urges “immediate” action to address key deficiencies:

• No one is authorized to exercise overall command and coordination over government’s response to a serious pandemic.
• No central agency has responsibility or authority to to ensure critical government and non-government services such as power, water, snow clearing, policing and fire response continue during a time when absenteeism may be high.
• The province has not assessed the adequacy of pandemic response plans by district health authorities, which provide hospital-based health care service.
• 55 percent of family and emergency room doctors surveyed by the AG were “not happy” with their ability to obtain critical supplies.

Moneyquote:

Given that we are currently experiencing an H1N1 pandemic, we feel most of our recommendations should be addressed immediately to ensure Nova Scotia responds effectively to the current situation and is ready for any worsening conditions.