During the CEA meetings, I engaged in some provincial election talk with colleagues from Nova Scotia. I had just come off a brutal BC election campaign, in which the opposition stuck to a rather bland platform anchored in fiscal conservatism and axing the carbon tax. The NDP lost, and amid the subsequent soul-searching, leader Carole James just axed the axe the tax campaign, and will now pursue a “fix the tax” strategy. That said, the NDP polled higher in losing than when it won in 1991 and 1996, so perhaps that strategy was a political winner, after all.
In my briefings on Nova Scotia, I was dismayed to hear much of the same strategic thinking of BC at work on the Atlantic coast, and with victory in sight. And sure enough, last week the NDP won. Due to the lack of subsequent commentary, I asked Halifax correspondent and PEF steering committee member Brendan Haley for his thoughts:
NDP Elected in Nova Scotia – What Now?
By Brendan Haley
The NDP has been elected in Nova Scotia with a majority government. Premier Darrell Dexter will name his new cabinet on Friday. This is the first NDP government elected east of Ontario in Canada’s history.
This is a victory a long time in the making. A major breakthrough for the party occurred more than ten years ago when the NDP tied for most number of seats with the Liberal party in 1998. Since that time the NDP has been the official opposition and quietly waiting to form government. That moment came in this election, with an unknown 3rd place Liberal leader and an unpopular and incompetent Conservative Premier.
The NDP ran a tightly organized and tightly lipped campaign, producing 7 key commitments. Amongst these commitments was the production of a balanced budget next year, an “expenditure management review” to save 1% in non-essential spending, removal of the sales tax from electricity consumption, a 50% rebate of the provincial sales tax for new home construction, keeping emergency rooms open, improve training for young people and tax incentives to keep young people in the province.
With all of the promise of balanced budgets, no new taxes and more tax cuts, the Conservative’s “Risky NDP” Socialist Red Scare campaign was totally absurd and fell completely flat with voters tired of the ineptitude of their existing premier and comfortable with Darrell Dexter.
One has to wonder at this point how exactly the NDP government will handle the province’s current situation. The province has, thus far, been less hard hit by the recession. Halifax is quietly attracting financial, insurance and research intensive economic activity. But, many of the traditional, resource-based industries (forests, farming, and fishing) outside of Halifax are potentially on the brink. The province also has one of the dirtiest energy systems in the country, getting 75-80% of its electricity from coal and is one of the most vulnerable to the effects of climate change.
Nova Scotia desperately needs to make investments so it doesn’t miss out on the next wave of innovation. It needs substantial investments to be made through electric rates and taxes (or both) to harness some of the best wind and tidal resources in the world and to unlock itself from its fleet of antiquated coal-fired power plants. It needs to keep young people in the province and take advantage of its strong university sector through education, training and apprenticeship programs. It needs to find strategies to revitalize its rural communities – perhaps through a strategy for community-based renewable energy generation. And its needs a real strategy to provide social services for the provinces ageing population and reduce poverty in a province with a lack of adequate housing and youth opportunities, especially amongst First Nations .
Many of these issues have been talked about in the province for years in the community sector, university sector and in forums such as the Premiers Advisory Council on Innovation which suggested an innovation strategy focused on the “environmental economy”. But a real “vision” never really came forth from any of the political parties during the election.
So one is left to wonder what tack the provincial NDP is going to take.
To attract rural votes the party put together some forward looking strategies for the forestry and agriculture sectors. For forestry a one-year incentive to increase demand for wood products and a long-term plan which included more sustainable harvesting practices and reductions in GHG emissions. For agriculture a local food strategy, strategic farm research, marketing support and other process improvements.
But one is left to wonder how the NDP will tackle these economic times and prepare the province for the future with their insistence on “balanced budgets”, which could also mean a lack of forward-thinking investments. In fact Dexter’s promise to avoid new spending includes capital investments, which prompted the province’s major newspaper to give him the following advice:
Mr. Dexter sounds excessively cautious in saying future capital spending should not add to the debt. That would mean running budget surpluses large enough to cover new capital, often making it hard to both balance the budget and keep infrastructure up to date. A better approach is to keep the carrying costs of borrowing for new capital at a manageable level in the operating budget. (The Chronicle-Herald Editorial – May 16th, 2009)
Mr. Dexter could also take the advice of Duncan Cameron
The spectre for meaningful investments is even further deteriorated by Dexter’s promises of tax cuts, most prominently a $28 M tax cut to take the 8% sales tax off of electricity. The $1 M promised for energy retrofits pales in comparison to the $28 M tax cut pledge. This is of real concern for a province with some very real energy poverty issues and one of the oldest housing stocks in Canada.
The NDP might not be all that supportive of investments in a more energy efficient province through electric rates either. Nova Scotia has recently set ambitious and leading-edge efficiency targets for its electricity sector that will prevent it from having to build another coal-fired power plant estimated to add another $1 billion in net present value costs. But during the election, the NDP announced that it opposed the electric surcharge that would be paid for the efficiency program, with no details of their alternative.
The NDP proposed a number of impossible public policies during the campaign. They insisted that the province was in a deep deficit, but that they would balance it within a year without raising taxes and by giving a series of tax cuts. They expressed support for energy efficiency, but not if you have to pay for it. So which side of these issues will the NDP come down on?
Even though the policies appear contradictory and as Thomas Walkom said “fiscally at least – to the right of Conservative Prime Minister Stephen Harper”, it is important to recognize the potentially path-breaking change the election of the NDP could bring to Nova Scotia politics. This has been consistently emphasized by the Herald columnist Ralph Surette who hopes the NDP mounts the “third great reform movement in Nova Scotia’s snarled political history…to actually change our bad (patronage-ridden) political culture”.
Perhaps the biggest promise of the election of the NDP is that government will actually appoint the best people and make the best day-to-day decisions instead of catering to party patronage and the “old boys” network of the province.
The intersection between Surette’s views on patronage politics and Dexter’s fiscal policies seems to be that the debt that Nova Scotia owes is not because of too much spending but because previous Tory and Liberal governments spent money on patronage and pork-barrel instead of making wise investments.
So who knows. Maybe there actually is room for a 1% cut across the board in patronage projects and the NDP will find ways to redirect the money of the people of Nova Scotia towards actual investments in a more green, equitable and prosperous future?
Premier Darrell Dexter certainly holds the trust of the people of Nova Scotia at this moment. I believe this is less due to his “conservative progressive” policies than due to his friendly demeanour and persistent patience, which allowed Conservative Premier Rodney MacDonald fall over his own feet.
With four years of majority government we can be hopeful for the emergence of Surette’s “third reform” movement in the footsteps of Joe Howe and “Progressive Conservative” Robert Stanfield. If Dexter is to follow in the footsteps of these highly respected men he will have to park many of the short-sighted, contradictory, opportunistic and poll-driven policies espoused during the election and use the trust he has garnered to propose, discuss and implement good policy with the people of Nova Scotia.
- Flaherty’s Funny Math with the EI Surplus (December 6th, 2013)
- A Trillion Dollar Coin for Canada? (December 4th, 2013)
- The Ford Nation, Perils of Populism and Public Choice (November 28th, 2013)
- Canada’s (not so incredible) shrinking federal government (November 20th, 2013)
- Saskatchewan Budget Saved by Falling Loonie (August 8th, 2013)