Danny next

Posted on April 30, 2014 | Atlantic Business Magazine | 0 Comments

He learned soon enough. With only two over-the-air channels available in his native province, Williams quickly understood “people will pay for choice,” which at that time simply meant adding in a few U.S. Network signals from Bangor, Maine.

The problem was that Williams didn’t have any cash of his own to invest. So he borrowed $2,500 and then talked his father into anteing up an equal amount so they could jointly acquire a 4.5 per cent interest in his freshly minted Avalon Cable company. (His father would later sell his shares back to his son for $250,000.)

“I never intended for it to become what it became,” Williams allows today. But he kept buying out the other original investors one by one until he eventually became sole owner.

After he’d decided to jump into electoral politics, however, he quickly realized it wouldn’t be smart to be “sending out 75,000 bills a month to potential voters.” Williams put the company on the block. Rogers offered “a good deal” ($250 million) and it was done.

All of which meant that Danny Williams – “Danny Millions” as he had become known – was able to walk into the political arena so independently wealthy, so beholden to no one, he could easily, and happily, forego his politician’s salary and do, and say, whatever he wanted.

By then, Danny Williams knew exactly what he wanted to say and do.

During the months leading up to his anti-climactic official announcement in December 2000 that he would indeed seek the Conservative party leadership (he turned out to be the only candidate for the job), he read voraciously, consulted widely and then wrote, rewrote, revised and polished (“40 to 50 drafts”) the blueprint for what he intended to do as premier.

He understood that the Newfoundland psyche was still haunted by the Upper Churchill energy “giveaways” of the Smallwood era of the fifties and sixties. “We had been blackmailed, extorted, call it what you will, by Quebec, and it was time to right those wrongs.” That was the sine qua non at the top of his to-do list.

On a more hopeful note, of course, there was the promise of offshore oil and gas development. But that too came with fraught negatives: the existing federal-provincial deal meant Ottawa could claw back equalization payments to compensate for whatever gains the province reaped from development of its own resources. Worse, if and when there was significant production, existing arrangements allowed the multinational companies to vacuum the lion’s share of revenues from any offshore income. All of that would need to change if Newfoundland was to ever become the “have province” Danny Williams envisioned.

By the time Williams finally became premier in 2003, Newfoundland was a fiscal basket case, still reeling from the cod moratorium, saddled with “seriously deteriorating” infrastructure and bleeding its best and brightest young people to better prospects elsewhere. Officials in the department of finance were projecting an unsustainable $840-million operating deficit for 2004, not to forget its conjoined twin: an $11-billion, and growing, provincial debt.

Which may explain why Williams’s new government invited Price Waterhouse to look under the hood of the province’s treasury: the consultants quickly concluded the province’s pension fund, and the province itself, were both swiftly rolling along the road and over the cliff to bankruptcy.

“There were no quick fixes.”

Williams’ own quickest, and most controversial, fix was to slash government spending and ice-in-place public sector wages for two years, while pledging to eliminate 4,000 of those provincial government jobs in the process. On April 1, 2004, 20,000 public sector workers responded by walking off their jobs.

Williams’ personal popularity, which had topped 65 per cent at the time of his election, sank to little more than half of that by the time he’d legislated the workers back to work a month later.

Today, Williams insists he had “no choice. We had no money, so we had to stand our ground.” His advantage as premier, he says, was that “I didn’t need the job. If things didn’t work out, I knew I could always walk away.”

But voters eventually came around. Two years later, while campaigning door to door in a by-election, Williams recalls he met a woman who had strongly opposed his austerity measures. “I was ready to kill you,” she told him, “but now I understand.”

By then, of course, the political ground had shifted to the more Newfoundland nationalist issue of the Atlantic Accord, the 1985 federal-provincial deal to manage Newfoundland’s offshore oil and gas resources that had effectively handed over the benefits of Newfoundland’s resources to Ottawa.

Soon after he was elected, Williams began lobbying, cajoling, haranguing, not to forget insisting Ottawa reopen the deal. He traveled the country to plump for a new accord, enlisted the support of his fellow premiers and opposition politicians, even publicly stomped out of one meeting with Paul Martin when the then-prime minister offered a compromise Williams claimed would cost Newfoundlanders billions of dollars. Just before Christmas 2004, he ratcheted up the political thermostat to boiling, instructing officials to symbolically remove Canadian flags from provincial buildings. By the time he ordered them back up a month later, Williams had not only won a new deal giving the province 100 per cent of royalties so long as it was a have-not province but he’d also changed the provincial psyche. His fight with Ottawa, he declared in a speech at the time, had been “about more than money… it was about integrity and dignity and honour, and it was about pride! And those things cannot be bought. I can tell you that I have never been more proud to call myself a Newfoundlander and Labradorian!”

Check one item off his to-do list.

Three years later, he signed deals with the major multinational oil companies that gave Newfoundlanders a much better deal, including an equity position in ongoing and future projects. Checkmark beside that one too.

One year after that, and barely a month after being re-elected premier with an incredible 70 per cent of the popular vote, Williams declared “a very proud day… We received information today from the federal government… that as of today… Newfoundland and Labrador is now a ‘have’ province.”

Two years later, on November 18, 2010, Williams ticked the last, and psychically most important item from his original to-do list: a $6.2-billion deal between Newfoundland’s publicly-owned Nalcor Energy and Nova Scotia’s privately-owned Emera Inc. to develop Labrador’s Muskrat Falls Lower Churchill hydroelectric project and ship its endless supply of electricity to Newfoundland, Nova Scotia and on into the electricity-hungry northeastern United States.

“That,” Williams tells me with obvious satisfaction today, was a “slap in the face to Quebec Hydro,” not only for its generations-old snookering of a previous Newfoundland government but also for its more recent attempts to “stall on Muskrat and Gull Island (hydro projects). They tried to block us at every turn, and we were able to finally circumvent them. ‘We can go around you.'” There is a raised mental middle finger in his tone. Perhaps more significantly, the Atlantic route, he adds, will become a “great Atlantic Canadian project,” a region builder, a game changer.

Danny Williams had completed what he set out to do.

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