Beefing up corporate welfare

The politics of bad business decisions

One of the rules of thumb in Canadian politics is to always send a minister to deal with a tough public policy decision (i.e. the closing of a mill/factory, the cutting of jobs or the announcement of a shacky business deal) and to have the premier only attend and do photo ops when it is guaranteed that there will be good press that follows.

Well, judging from the photo taken above in Charlottetown, PEI last sunday (where premier Graham and Macdonald were missing), the announcement to pour an additional $12 million of taxpayers money into the future of the Maritime beef processing industry obviouly wasn't a good business transaction for either the province of New Brunswick or Nova Scotia. To be frank, if there was any winner whatsoever here, it was PEI premier Robert Ghiz as the other provinces believed his poker face when he said that he was going to shut down the processing plant in the first place (c'mon, we all know that would have been political suicide on the red island). Moreover, all the jobs which were retained, or resubsidized, are located in his province to boot (at a total payroll cost of $2.5 million per year). Plus, about 80 per cent of the cattle it processes comes from P.E.I. Not exactly an equitable situation for the industry in all three provinces.

Anyway, I won't go on ad nauseam about how [this] corporate welfare deal is damaging not only to taxpayers in this province, but also to the industry itself. If you want that type of info, I urge you to go here for your starter kit on the issue. I will assure you that it's a real eye opener to say the least.

Anyway, what really got my attention was not the bad deal itself (that is self-evident), but the rhetoric by the sitting ACOA minister (who passes himself off as a supposed fiscal conservative who represents those views regionally):

Ensuring that beef producers here in the Maritimes continue to have access to a federally-inspected plant has been a priority of mine since becoming minister of ACOA.

Without this plant Maritime producers would be forced to ship animals at considerable cost to Quebec, Ontario or the United States. It’s estimated the closure of the plant would have meant a loss of 350 jobs, directly.

In other words, doesn't the ACOA minister's statement, not to mention the deal itself, totally contradict what was recently said by Jim Flaherty earlier on in the week in Ottawa at the finance minister's meeting about corporate welfare deals for declining industries in the maritimes:

I don't believe in corporate welfare or in propping up failing companies.[...] I'm not a band-aid-solution sort of finance minister, quite frankly.

Huh? Am I missing something here folks?? How can a processing plant, which has been reported to be losing up to $600,000 a month, be a good investment for an additional $10 million of our hard-earned tax dollars? How could this be classified as a good business deal? Methinks somebody in the finance department and ACOA have some explaining to do.