The BNB show

I’m surprised that economic development is getting fairly heavy play in this election.  Don’t get me wrong, in every election the parties will have an economic development component but so far it seems to be more of an issue.  Starting with the NDP calling for BNB’s demise and the Tories’ plan to set up an InvestNB organization.

It’s a good thing that economic development is on people’s minds and it’s a good thing the Tories are actually talking about attracting investment.  You will recall in 1999, the Tory plan was for a “made in New Brunswick” approach to economic development.  Now, it seems, they realize we need to be a province that has both a strong focus on local entrepreneurship and the business case to attract national and international investment.

The NDP plan is not particularly realistic although they haven’t told us the mechanism they would use to push forward economic development.

I think there does need to be a serious debate in this province about taxpayer dollars being used to ‘retain’ or ‘save’ jobs.    In the wake of the recession, that terminology is all the rage but we really have to think this through.  There may be times we want  to ‘save’ a company but that should be rare.  In general economic development has to be about growth and moving ahead – not holding on to the past. 

Think about UPM.  It is clear now they received millions of dollars in taxpayer funding just to prolong the inevitable.  I have talked to folks in the ‘Chi who told me the same thing – including the final $5 million given by former Premier Lord to get them to hold off through the last election.

If there were structural business case issues with UPM that made it uncompetitive to operate in New Brunswick -access to fibre, infrastructure, energy costs, etc. – then the role of government is to decide what, if any, public policy tools could be used to address these issues – industry wide.  For example, I have no problem with NB Power having a large industrial rate as an economic development tool or I have no problem with taxpayer dollars invested in crown forestry development, etc.  That, it seems to me, is a far different thing than giving $5M, $10M or $35M to a firm in the hope it will stay open a few years more.

At the end of the day, economic development investments must have a payback to the taxpayer – a clear, financial payback to the taxpayer or why do it at all?    I have heard all this crap about how “it would have been worse” without us – in several contexts.  I don’t buy it. 

We need a tad more ambition for our economic development organizations than just “it would have been worse” without them.