Government investment and social good: Morning File, Wednesday, August 9, 2017

News

1. Failed “investments”

Yesterday, I noted that Nova Scotia Business Inc. had written off more than $26 million in “investments” it held in businesses that the crown corporation promised were going to bring prosperity forever, amen.

There might be a case for government investment in industry. At least, I’m not necessarily against it on principle. But I think that public investment should serve some sort of social good.

For example, while the execution of the loan, a path to financing that requires insider connections, and the management of the companies might be questioned, I have a hard time finding a philosophical objection to investing in companies that are working on technologies that will reduce our dependence on fossil fuels. Climate change is, after all, the crisis of our time, and the injection of public funds towards addressing it is appropriate, although of course we should show some discernment about where the money goes and hold the expenditures up to public scrutiny.

But many of the written-off investments were into companies that provide no social good whatsoever. I’ve written extensively about NSBI’s $7.9 million investment into Origin Biomed, a company selling a quack homeopathic cream called Neuragen. In 2015, I wrote:

So here’s my question: Does it matter what NSBI invests in, or is the only criteria that the company sells something, anything, for export, and that’s the end of it? Export sales, period, seem to be the goal. If a company sells a bogus health cure that takes millions of dollars from people in pain, that’s evidently none of NSBI’s concern.

Leaving aside the issue of whether the government should be investing in particular companies at all, once that decision is made, shouldn’t there be an ethical filter? If a company figures out a way to sell toxic waste-laden baby food for export, would that be a barrier?

As I see it, if the government is going to invest in companies, the companies should at least be producing a socially useful product worthy of taxpayer support. And no, body scans so overweight people don’t have to be embarrassed trying on clothes isn’t a product worthy of government support.

So, let’s take a look at the companies NSBI wrote off last year:

Billdidit — $238,418.

“Billdidit was the developer of what’s known as the Coady Clutch system. It allows drummers to generate the desired amount of sizzle from their hi-hat cymbals,” reported the Chronicle Herald. This may be very cool. It may give drummers and people who like drumming great glee. It is not, however, a social good worthy of public money.

Blue Wave Seafoods Inc. — $1,400,735

“Former fisheries minister Sterling Belliveau defended the then-NDP government’s $500,000 restructuring loan to the company that he said would protect 70 jobs in Port Mouton,” reported the Chronicle Herald. “But the Nova Scotia Fish Packers Association questioned lending money to a seafood processing company having financial issues when the province has more processing capacity than it needs.” So it was a make-work project. There may be a place for make-work projects, but this was clearly not well thought out.

MeID Inc. (Unique Solutions Design Ltd.) — $5,628,108

Unique Solutions produced a body scan booth so people with poor self-image about their bodies wouldn’t be embarrassed by trying on clothes that didn’t fit them. Again, this might have been (but wasn’t) a product that some people out there in the world would be interested in, but it’s not a social good that deserves public money. I untangled the Unique Solutions mess; you can read the entire ugly saga here.

Pure Energy— $5,647,477

Pure Energy produced an alkaline rechargeable battery; the NSBI investment was to expand into the wireless market. This one is debatable: arguably, battery technology might help speed along the development of renewable energy generation, but in this instance, that’s a real stretch. I’m saying no social good.

NSBI’s press release: “Keep your eyes and ears open for the WildCharge name. By combining first-of-its-kind wireless charging technology with the most environmentally responsible rechargeable batteries, PureEnergy Solutions is poised to generate new opportunities for growth in the wireless market.” Or not.

Quanta Nova Canada Ltd. — $2,353,818

QuantaNova first failed in 2001. NSBI actually loaned the company $7.7 million, but was able to pawn off $5 million of that onto a Norwegian company.

Quanta produced “paclitaxel, an important anti-cancer ingredient used by the pharmaceutical industry in the treatment of breast and ovarian cancer.” You can argue among yourselves whether public money should be used for this sort of thing or whether the government should simply own the patents outright and produce the drugs itself.

River’s Bend Wood Products — $136,448

River’s Bend sold products made from hardwood, and the investment into the company may have been an admirable attempt to boost a sustainable forestry industry. On that count, I judge this a social good.

The problem, reported the Antigonish Casket: “Two years later and River’s Bend is closing its doors. Not because of lack of market for the products it makes, but because they cannot secure enough local hardwood to make it work….While [owner Paul] van de Wiel did not say it, one wonders if the successful opening of Port Hawkesbury Paper and the biomass generator in Port Hawkesbury has had an impact with woodlot owners. It is much easier to cut massive amout of softwood to send to the mill than to select hardwood in the woods and mill it for River’s Bend or any other business. The lack of access to Crown land now controlled by the paper company adds to the difficulties.”

So while NSBI was tasked with doing something useful — helping a small company build a sustainable forestry industry — another government agency, the Department of Natural Resources, was undermining that worthy goal.

Scotian Halibut — $980,613

This was a fish farm on Cape Sable Island. I’m not familiar enough with the operation to make informed comment.

Tech Link — $10,088,824

I wrote about TechLink here. The short of it is that the province was trying to whitewash its involvement in the gambling industry with a “responsible gaming” component run by TechLink, then tried to export the dubious technology to double down on its investment. A mess all around. No social good whatsoever.

2. NSGEU asks for arbitration

The Nova Scotia Government and General Employees Union issued the following press release yesterday:

Final attempts to negotiate a new collective agreement between civil servants and their employer with the assistance of conciliation services failed on Tuesday afternoon, as government officials refused to budge on issues of key importance.

Originally, August 8th and 9th had been set aside for an arbitration hearing with the Labour Board. However, the NSGEU and government officials agreed to return to the table for one last attempt at conciliation, in hopes of reaching a deal. In the event conciliation failed, government officials agreed they would not oppose the union’s request for arbitration.

Unfortunately, the employer was unwilling to budge on any significant issues of importance to civil servants.

“It is now abundantly clear that government is not genuinely interested in reaching an agreement with our members,” said NSGEU President Jason MacLean.

“This has been an extremely frustrating process for members of our bargaining committee — as well as the 8,000 civil servants they represent. However, we will now proceed to arbitration — as voted by our members and agreed to by government — with the goal of reaching a fair agreement once the Premier is removed from the bargaining table.”

There are over 8,000 members of the NSGEU who work in the Civil Service providing a vast array of important public services across the province. They work in Access Nova Scotia centres, child welfare, corrections, the courts, education, finance, inspections, health & safety, wildlife, fisheries, mining, and forestry – just to name a few.

Civil Service members voted to reject a final offer by government on December 14, 2016, which included a four-year wage package with two years of zeros, a third year of one percent, and a fourth year of 1.5 percent with a 0.5 percent increase on the last day of the contract. The offer also included the elimination of a long held benefit, the Public Service Award (PSA). The benefit would not be offered to employees hired after April 1, 2015 and it would be frozen for current employees as of April 1, 2015 paid out at the wages the employee earns when their employment ends (or upon retirement). The PSA was negotiated in 1974 and took its current form in 1984. It was negotiated to help recruit and retain workers to the Civil Service.

The Civil Service Master Agreement expired March 31, 2015.

3. Arson

“Three large forest fires that burned hundreds of hectares of woodland in southwestern Nova Scotia last summer were most likely deliberately set, the Department of Natural Resources says,” reports Ian Fairclough for Local Xpress:

“I believe that they were intentionally lit as arson fires,” says Jim Rudderham, the department’s supervisor of fire management.

[…]

The largest fire, at Seven Mile Lake in Annapolis County, burned 400 hectares, while a fire at Maitland Bridge, Annapolis County, burned 21 hectares and one at Ten Mile Lake in Queens County burned 10 hectares. The fires burned over 12 days, starting on Aug. 3.

The three fires were only about 20 kilometres apart.

[…]

The cost of fighting the fires was more than $3.5 million.

4. RU-486

“With Ontario beginning to cover the cost of Mifegymiso later this week, the founder and co-ordinator of Maritime Abortion Support Services says it’s time Nova Scotia followed suit,” reports Yvette d’Entremont for Metro:

Mifegymiso, also called RU-486, is a two-drug abortion pill that can be prescribed in Canada up until seven weeks (49 days) gestation. The cost is currently covered or will soon be covered in New Brunswick, Quebec, Ontario and Alberta.

“The other four provinces have invented the wheel and now we just have to get on the bandwagon,” Shannon Hardy said.

“We sincerely don’t have to come up with anything new and exciting. It’s more about will. It’s having the will.”

5. One likely conclusion of visiting Nova Scotia

Guardian travel writer James Mullinger came to Nova Scotia to explore the landscapes that inspired Maud Lewis, but ended up drinking with Catherine Robertson at Bearly’s. Haven’t we all, James.

5. Another likely conclusion of visiting Nova Scotia

“A man who landed in the drunk tank after giving Halifax police the finger is questioning the rationale behind his arrest, a case one lawyer says highlights concerns about the ‘arbitrary’ powers officers have to lock people up for public intoxication,” reports Elizabeth McMillan for the CBC:

Jason Napier, 33, who lives in Alberta and was visiting Nova Scotia for his grandmother’s burial, was one of 249 people arrested last month for public intoxication in Halifax.

Napier said he only had one scotch before Halifax Regional Police cuffed him around midnight on July 26 as he sat on the sidewalk outside his downtown hotel.

“I was in disbelief,” he said. “In my opinion, the police are here to serve and protect. No one needed to be protected.”

His wife, Alison Napier, recorded the arrest on her phone.

Those Albertans… I don’t know which is worse, flipping off cops or holding the phone vertically when you’re filming the cops.

Views

1. Natal Day not a holiday

“Did you work on Monday?” asks Judy Haiven:

If you wait tables or cook at a restaurant, work in a café, work as a sales clerk or a security guard, the answer is probably yes.

Wait – wasn’t Natal Day supposed to be a holiday? Nope. The NS government, in its wisdom, has declared only six statutory holidays — or General Holidays every year.  All six — New Year’s Day, Heritage Day, Good Friday, Canada Day, Labour Day and Christmas Day — are “retail closing days.” Natal Day isn’t one of them.

Online, the NS government helpfully points out that though Natal Day is known as a civic holiday, it’s not really a holiday, though it is “commonly a day off.” Really?

Haiven goes on to explore which days Nova Scotian workers are supposed to get off and paid for, but which restaurant workers typically don’t.

Relatedly, Nova Scotia is stuck in the 1950s with overtime rules. In Nova Scotia, employers aren’t required to pay overtime until an employee works 48 hours a week. In most of the rest of North America, it’s 40 hours.

Changing that requirement, bringing the province into line with other provinces, is a no-brainer. I don’t know why the supposedly labour-friendly NDP government didn’t do it, but the current Liberal government should. It might help with their generally anti-labour reputation.

2. Census data reveals Nova Scotian poverty

Richard Starr takes a deep dive into recently released census data, noting that:

In times gone by when local newspapers had more resources and a greater commitment to their readers there would have been some good localized coverage of the latest Census release. That may still come, but in the meantime, local media either ignored the Census story or took the same approach as the national media.

Sure. I got the data, but didn’t dig into it because I don’t have much commitment to my readers. I was tracking ships instead.

Anyway, continues Starr:

[T]he most recent low income statistics reveal that in 2015 Nova Scotia had the country’s highest overall poverty rate. At 17.5%, the overall rate was the worst since 1976 and represented only the second time since 1976 that Nova Scotia has claimed the dubious honour of the worst rate of poverty in the country.

Surely that’s news worth ferreting out and reporting. But like the facts about lone-parent families, the poverty stats have pretty much flown under the radar since their release by Stats Canada in May. The indifference is even harder to accept, given that the release came towards the end of a provincial election campaign during which one of the major parties made the poverty issue the central focus of its platform. And it wasn’t just the poverty rates that were troubling. Other highlights of the release (CANSIM 206-0041) included:

• Nova Scotia families had the lowest median income in Canada;
• Nova Scotia families had the lowest median market income;
• And also the lowest after tax median income in the country.

Perhaps the media and our opinion leaders have decided that the poor economy is no longer news. Maybe the facts about sagging employment, the aging population, economic stagnation and poverty have become routine. Or perhaps the media and our policy makers and opinion leaders have decided that there’s more profit in embracing a sunnier alternative reality.

Government

City

Wednesday

Regional Watersheds Advisory Board (5pm, Alderney Library) — the board will look at the Green Network Plan.

Province

No public meetings until September.

On campus

Dalhousie

Wednesday

Thesis defence, Biochemistry (Wednesday, 9:30am, Room 3107, Mona Campbell Building) — PhD candidate Kyungsoo Shin will defend his thesis, “Expanded Insight Into Processing and Isoform-Dependent Properties of Apelin.”

Thesis defence, Psychology (Wednesday, 10am, Room 3107, Mona Campbell Building) — PhD candidate Kathryn Melissa Schweissing Rancourt will be defend her thesis, “Sexual Communication in Couples Coping with Provoked Vestibulodynia: Associations with Biopsychosocial Outcomes and Trajectories of Change with Intervention.”

Peptides (Wednesday, 4pm, Theatre C, Sir Charles Tupper Medical Building) — Hans J. Vogel, from the University of Calgary, will speak on “Antimicrobial peptides, biosynthesis, new targets and novel evasion mechanisms.”

Thursday

Thesis defence, Pharmacology (Thursday, 9:30am, Room 3107, Mona Campbell Building) — PhD candidate Amina Mustafa Bagher will defend her thesis, “Allosteric Interactions Within Cannabinoid Receptor 1 (Cb1) And Dopamine Receptor 2 Long (D2L) Heteromers.”

Thesis defence, Biology (Thursday, 1:30pm, Room 3107, Mona Campbell Building) — PhD candidate Benjamin James Smith will defend his thesis, “Contribution of NAv Channels to the Development and Function of the Retina.”

Saint Mary’s

Wednesday

Thesis Defence, Applied Science (Wednesday, 1pm, Science 310) — Darcie Stack will defend her thesis, “Phosphorus & Silicon Derivatives of Highly Conjugated Organic Molecules and An Exploration of the Reactivity of N-Heterocyclic Compounds & Carbenes.”

Thesis Defence, Applied Science (Wednesday, 1pm, Science 345) — Shruti Kumar will defend her thesis, “Investigating Whether the FGF Pathways are Involved in Scleral Ossicle Development.”

In the harbour

5:30am: Columbia Highway, car carrier, arrives at Autoport from Jacksonville, Florida
6am: Oceanex Sanderling, ro-ro container, arrives at Pier 41 from St. John’s
6am: ZIM Constanza, container ship, arrives at Pier 42 from Valencia, Spain
7am: Sarah Desgagnes, oil tanker, arrives at anchorage for bunkers from Quebec
11pm: Itea, container ship, sails from Fairview Cove for Liverpool, England
11:45am: Columbia Highway, car carrier, sails from Autoport for sea
2pm: Sarah Desgagnes, oil tanker, sails from anchorage for sea
4pm: Malleco, container ship, arrives at Fairview Cove from Norfolk
4pm: ZIM Djibouti, container ship, arrives at Pier 42 from New York
4:30pm: ZIM Constanza, container ship, sails from Pier 42 for New York

Footnotes

I’ll be on The Sheldon MacLeod Show, News 95.7, at 2pm.