Saturday, November 24, 2012

Suppose the Irvings Had Not Set Up Shop In Moncton

Responding to David W. Campbell, Thanks, Robert. What’s next?

Suppose the Irvings had not set up shop in Moncton...

Would we have a transport company, like Midland? Almost certainly! In fact, we may have had several, with competition making them more productive, and wages reflecting national averages. Perhaps national and international companies would have set up shop here, creating potential for servicing and spinoffs.

Would we have frozen potato products, like Cavendish? Of course we would; any region that grows potatoes would have such an industry. Maybe it would be McCains. Maybe it would be, again, a national or international company.

Similarly, we would have agri-services industries as well. Perhaps more than one. Such an environment might have been much more favorable to the local agriculture industry, which may have resulted in greater conversion of land to agriculture, increased production, and again, better wages.

Would Moncton have a tissue company, like Royale and Majesta (both owned by Irving)? Again, we may have international brands, like Kleenex, Kimberly-Clark, or some other wood product company. These companies locate anywhere there is wood, so there would be a substantial presence in Moncton and New Brunswick. Perhaps the province might even have a value-added wood products industry, like an Ikea, which it seems to be totally lacking now.

Would the city have a disposable diaper manufacturer, like Irving Personal Care? Well - probably not. So we can give them that.

What Irving brings to the city by way of transport companies, food processing and pulp and paper is minimal at best, and would probably exist without them. The companies that would have appeared here in its stead might have been larger, more productive, more competitive, and most importantly of all, might have paid better wages.

And what Irving brings to the city needs to be balanced out against the negative influence of a single large monopoly owning pretty much the entire wood production, agricultural production, transportation, energy and newspaper industry in the province.

Having one huge company has distorted the political process, pushed down wages, and left the cities of the province in a position where they need to grant extraordinary tax exemptions and Irving-friendly policies as they compete against each other for a share of the provincial behemoth.

New Brunswick has no major cities; it is the only province in the country in that position. Even tiny Charlottetown carries more weight on the national scale. Look how long it took to develop a proper highway system linking our cities, decades after every other province in the country. Only this year did we finish our four-lane link to the U.S.

The overt influence of the provinces major gas and oil company have left the transportation and energy industries in a shambles.

With the fiasco surrounding our nuclear plant restoration, people forget that it was an Irving transportation company that dumped the turbines into the bottom of Saint John Harbour. (It was also the oil-dominated Harper government that gutted Atomic Energy Canada, delaying the refit by years).

When we drive the highway to Halifax it's hard not to be struck by the wind turbines on the Nova Scotia side of Tantramar, and an emptiness on the wind-blown NB side. (Yes there are some windmills hidden in the hills; our province gave an Alberta company permission to build them and own them).

Our power generation industry is otherwise in fiasco. We have over the years foolishly depended on coal and (often dirty) oil. We were so much enthralled with it we lost hundreds of millions in the orimulsion bitumen-based fuel fiasco (interestingly, bitumen-based fuel is what is being contemplated for the Keystone pipeline).

The politics behind the deployment of natural gas in the province boggle the mind. Enbridge is the external company that took the risk to (finally!) bring a cheaper and cleaner fuel to the province. It has had a great deal of difficulty marketing to industrial partners, and (frankly) has been jerked around by the provincial government. Enbridge may not be the most pleasant company in the world, but here at least, it has been given a raw deal.

Meanwhile, in a city with a newspaper dominated with car and truck and Jeep advertisements, pubic transportation has been decimated. Irving has led the campaign to break the bus drivers' union. We have had no bus service for months, and the company now envisions a system of privately owned small buses more commonly found in the developing world. The rail system has also been essentially eliminated.

So, on balance, we are supposed to thank Irving for industries we would have had anyways? And ignore the harm a massive all-encompassing monopoly has caused to the province? This in the light of a provincial debt that has accumulated over the years, a debt that is coincidentally the same size as the Irving family fortune?

We need investments over the next 15-20 years, there can be no doubt of it. But rather than depend on the all-giving (but legendarily stingy) hand of the Irvings, we should be asking how we develop an economic development and investment regime that benefits *all* of us.

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