Reboot Alberta

Tuesday, September 01, 2009

Recession Over? Where is the Recovery?

Mark Twain once famously sent a telegram saying “Rumours of my death are greatly exaggerated.” I get a sense that same sentiment needs to be conveyed about rumours of economic recovery are also greatly exaggerated – and confounding as well.

We have the technical talk from economists telling us the recession is over in Canada. The June Stats Canada report shows our GDP rose 0.1% that month after 10 months constant and precipitous declines. This “turnaround” is just so much decimal dust in the big scheme of things, but it has spawned headlines like “Canadian Economy Back in the Black” in the Sun newspapers. Yes indeed rumours of recovery are greatly exaggerated. Let’s look at some context to help us determine the truth of the times.

The Globe and Mail rightly says while June GDP tipped-toed into positive territory the last quarter (April to June) was down 3.4% annualized and that was worse than expected. They say, “It doesn’t mean things are necessarily better, it just means they aren’t as bad as the last time data was collected.” Cold, hard truth and a side-order of reality are in that comment.

The US Federal Reserve Chair, Ben Bernanke says the economy teetered in February and warned of the “destructive powers of the ‘adverse feedback loop, in which weakening economic and financial conditions mutually reinforce.’” That is simple know as a vicious cycle. The key to the US recover according to Bernanke is for consumer to start spending again. Temper that hope with the fact that the American consumer has personal debt piled up that is equal to the entire US annual GDP. Spending is not likely to be the main concern of the typical American for the next while.

In Alberta we have the Canada West Foundation saying in a recent report entitled “A Rough Patch” in the Alberta economic profile. While oil prices have started to recover, unemployment is still high, investment is down means “…that the news is more bad than good.” CFW notes Alberta is very dependent on the US recover which it predicts will not start to turn around until sometime in 2010. CWF says energy prices will start to turn around too but “…last year’s contraction, the first since 1986, came as a bit of a shock to them (Albertan.)” They predict Alberta in 2009 will do worse than the Canadian average.

The recession may be at the bottom of the cycle in the minds of the economists but the issue for the rest of us is the recovery. Will it be a “V”, a fast drop and a quick recovery? Will it be a “U” fast decline lingering at the bottom and then a rapid recovery? Will it be a “W” with a false sense of recovery sparked by the infrastructure spending but not sustainable so we return to recession after the public infrastructure project spending is done? Will it be an “L” like in Japan? That reality of the “lost decade” in Japan recently caused a wholesale change in their politics and the demise of its “natural governing party in the recent election.

Nobody knows so use a skeptical eye and ear to whatever you are reading or hear from the “experts” in the area. I think we need to use this recession for a thorough review and rethink about the infallibility of the market place. That does not mean government control of everything either. What I would like to see is the economy returned to its rightful place –and that is to serve the society, not the other way around. I would also like to see the economy as repositioned to be the wholly owned subsidiary of the environment.

The economy is a man-made concept so mankind can change the content and context of the concept. Growth is good but like anything else, too much of a good think is harmful. Like many Albertans, L am longing for a Lougheed kind of leadership who will warn us to take heed and to adapt to new realities as we come out of this recession.

Lougheed is on record saying we Albertans, as owners of our natural resources, need to be sure our government and industry exercise some restraint, especially in how we develop the oilsands. The past economic policy of unfettered growth has only enriched a few but, in the process; it has set up the destruction of our society and our environment.

When it comes to the oilsands we can do better, and we better do better...and it better be green going forward.

Monday, August 31, 2009

Day 6: What Led Up to Mr. Ouellet Being Found in Contempt of Court

One of the most fascinating documents I read from the Court of Appeal file was the transcript of the discovery of Mr. Ouellet, part of the Foster Mother’s application to find him in contempt of court. Examination for Discovery is part of the litigation process to determine facts and other information in a legal action where questions are asked by lawyers and the answers are given under oath. They can become evidence in the litigation.


What Did the Director Know About the Case & When?
I took notes from the transcript and will share the answers and the questions they beg. The testimony indicates some interesting circumstances and realities of the Director’s position, case participation and responsibilities of the office, at least in this case, and presumably others. Remember this saga is all about determining and delivering to meet the best interests of the child. Consider who determines what those best interests are, based on what evidence and how do those responsible actually make the judgment calls about the safety, security and needs of at-risk kids in government care?

Did the Director get Bad Advice?
My impressions from reading the sworn testimony of Mr. Ouellet, I have developed more sympathy for his plight in this case. I think he got some bad advice. He also failed to do his own due diligence in his Director role as he decided to remove the child from the Foster Mother. That failure is not my opinion. That is the opinion of both the original Appeal Panel and the Court of Appeal.

Here is the background and circumstances that Mr. Ouellet found himself in and how he responded, based on his sworn testimony.


According to Mr. Ouellet, he did not know anything about the Court of Appeal order to return the child until a departmental meeting on June 5, 2009. That meeting was called by his staff responding to a Court of Appeal’s letter "clarifying" its outstanding order, from January 30, 2009. The Court of Appeal said its court order meant that the child had to be returned to the Foster Mother. Mr. Ouellet was the senior person in charge and also the official guardian of the child. He said he did not know this matter had been through two levels of court and now going back to court of allegations of his personal contempt of court until June 5, 2009.


What Power and Duties Did the Director Have?
How can there be no such communication to him from his departmental staff or legal counsel who were dealing with the matter, especially given his personal and professional accountability in the case? Is it oversight, lax procedures, poor leadership, poor training, overworked staff? If it is any or all of these concerns, does it all this add up to a serious management and leadership shortcoming in how matters are dealt with in this department? I tend to believe Mr. Ouellet saying he did not know what was happening in this case, since, after all, he was testifying under oath. Perjury is a tougher consequence than contempt.

He goes further saying in the management model in CYSA there is no obligation for workers to inform him as the Director of issues or concerns of any particular matter. The only permissions needed by the social worker and middle management staff are to seek prior permission of the Deputy Minister if the government wants to take matters into litigation.


June 5th Meeting Sealed the Director's Fate.
So let’s look at the events leading up to the June 5th meeting and the actions taken as a result. CYSA received a letter from the Court of Appeal on June 4, 2009 confirming its prior order meant that the child was to be returned to the Foster Mother. The lawyer for the Foster Mother had written to the court requesting directions and clarification of the court order because CYSA had not yet returned the child. That court order had been outstanding and ignored by CYSA for over 4 months by this time.

The June 5th meeting included the Director, a government lawyer and other senior department management people. In requesting the meeting the senior staff said to the Director that they needed to meet about "an interesting and challenging case." Yes indeed it was interesting and challenging but this seems euphemistic considering the seriousness of the matter, especially as to consequences for the child as well as for the Director "best interests" now too.


Four days later an application was made by the Foster Mother seeking an order finding the Director in contempt of court. In preparation for the June 5th meeting the Director was faxed background of the case on June 4th. But he did not read it before or even after the June 5th meeting. Why didn’t he read the file?


Could it be willful blindness, indifference, insouciance, inexperience, naivety or was it neglect and/or negligence? I don’t know, but in hindsight, I am sure the Director wished he had read the material and prepared himself better for that meeting. According to his testimony he was not told about the June 4 letter from the Court of Appeal at the time of the June 5th meeting either. Perhaps it was in the background material, but in any case, it is a very material piece of evidence in the child’s case and soon, in his own contempt of court case.


The Director testified that after the June 5th meeting it was clear that the child had to be returned to the Foster Mother. Curiously he did not direct the staff responsible for the child’s file to return the child. Strange, don’t you think? Well not so strange when you consider this part of the testimony where the June 5th meeting decided that the child should be returned but in this context: "provided all legal avenues had been exhausted." This language indicates a conscious decision to not follow the court order, at least not with any alacrity. That statement is so inappropriate and inconsistent with the rule of law.


What is the Consequence of Ignoring a Court Order?
You don’t ignore a court order – EVER! You can go back to the original judge and seek another order to set aside, vary of discharge the original order. Variations are permitted to correct errors in the original court decisions or to consider and reflect new facts that came to light subsequent to the original order.


Revisiting the court process is not a "do over" or a try again" option. It does not permit anyone to revisit any issue simply because they are dissatisfied with the decision or later thought of a better argument. Otherwise there would be no finality to litigation. This option to go back to the judge to apply vary or set aside the order was open to CYSA but they did not take it. CYSA and the Director had legal counsel throughout these deliberations, so it is not as if they missed knowing about this alternative. Instead they decided to continue to ignore the court order. Shocking!


The Director did acknowledge in his testimony that if he was aware staff was ignoring a court order that is would be "his duty to play a role." Interestingly there was also a statement in his testimony that neither he nor the Director’ office "had a role or involvement in decision making in management of the department." He also testified that a predecessor in the Director’s office had delegated duties to the region child and family services authorities.


But he still had 49 staff under his authority that provided administrative support, analysts and managers all "with a responsibility for provincial policy and direction…and implement provincial policy programs across the province." He said this group monitored standards and process review sections in the department. You would think with that kind of mandate, if any policy or process systems were not working in CYSA, the Director and his team would know about and ought to be doing something about it.


I can muster some sympathy for the Director because he may have gotten bad advice, as Justice Cote mentioned in sentencing in his contempt of court finding. But he was also the architect of his own demise in so many ways. For that he does not get a pass or any absolution just because he may have relied on bad advice. He had a duty to inquire more and it is apparent from the court record that the duty he owed to the child and the duty to respect and enforce the court order was left unfulfilled for too long. He has been in the public service for 32 years and is on the record saying "It’s absolutely essential that court orders be compiled with." His actions in this matter did not reflect his allegiance to that principle.


So with this testimony, it pretty much sealed the Director’s fate that he could be found in contempt of court, and, in the end, he was. He got sentenced to 8 days jail time as a result. He was given the option to do 40 hours of community service in lieu of prison. He also had to pay all the Foster Mother’s costs, including lawyer fees and disbursements, right back to the beginning of this sad and sorry saga. The court, in acknowledgement of Mr Ouellet perhaps getting bad advice from people who were assisting him within the government, allowed those costs to be paid by the government on his behalf.


What Should We Learn From this Case?
In my mind that would be entirely fair under the circumstances. The court also accepted one of Mr. Ouellet’s submissions that contempt of court may also be found against others in CYSA over their handling of this file. As a result, Justice Cote ordered his decisions to be sent to the Minister of CYSA and the Minister of Justice and encouraged them to look deeper into that question. So this aspect may not be over yet. Will that go anywhere? If it doesn’t, it will speak volumes about the character of the leadership in these departments.

I don’t think Mr. Ouellet should be dismissed either. I think he is too valuable as a symbol and talisman to remind people about how much things have to change within the management and leadership culture of this department. He could take this personal experience, and with cooperation of some sound management and some enlightened leadership, turn it into an opportunity to fix the problem. The courts have already fixed the blame on him and encouraged the government to pursue an inquiry about if others are also guilty of contempt of court.


Good people in a bad system are not good enough as an excuse for shoddy management and governance in this case and who knows in how many others in CYSA. Let’s hope there are lessons learned and a renewed commitment to doing this most difficult of public servant jobs both right and rapidly and in the real best interests of children in care. This matter is now about the political will, character of the leadership and personal commitment to do the right thing, especially in times of recession and restraint.


If the future of at-risk kids is determined by dollar costs alone then the social contract of government to society is going to be broken. If that happens then citizens have to respond politically, publically and purposefully and tell our politicians that they have to make sure that our most vulnerable citizens are properly cared for and respected, including those 13,000 at-risk kids in our collective care; who are our society’s children.

Sunday, August 30, 2009

Will Wall Street Return to its Old Ways?

Thanks to blogger Albertasaurus Talks I just came across a Toronto Star piece by David Olive entitled "The Era of Big Government Already in Retreat." It is worth a read.

David Olive says "Never in history, perhaps, has avarice spent so little time in hibernation." The meltdown of capitalism last September saw job losses for 7 million people in North America and an "abrupt global credit freeze" that wiped out "trillions of dollars of net worth of retirees and others as stock market property values plunged 40% and more." Olive says "Capitalism failed, again."

"Capitalism had failed, again. If a few avaricious pinheads in the financial markets could wreak such havoc so swiftly on the general population, then we would reinvent capitalism to make it more socially beneficial. It was that belief, of an urgent renaissance on the horizon, that helped keep the terror at bay last winter and spring."

Instead of using this recession to retool and rethink the regulation of capital markets, Olive argues the opportunity is lost and "We have gone back to living in ordinary times." This is because the Obama reforms, according to Olive, have already been stymied by "Wall Street lobbyists" and the argument is reform would be too expensive.

The same people who crated this crisis in confidence in the financial sector blithely discount the trillions of taxpayer bailout dollars for Wall Street in buying up their unregulated "toxic assets" that have devastated the wealth of ordinary people. That has not been too expensive because without real reform to ensure uncontrolled greed and avarice, we will not have learned from these mistakes in governance and be doomed to repeat them.

If Wall Street is allowed to return to business as abnormal without real regulatory reform, we are only one more greed induced disaster away from depression and devastation.

Canadians governments mostly followed the American lead and act as policy takers, not policy makers. Without some serious self-interest to decouple that political and policy approach we too will be sucked into the next American demise. This is not the kind of political discourse that gets sound bites or slogan journalism coverage. It is too complex and confounding to be approached from a simple-minded communications. To happen, it will have to emerge from citizens in op-ed, think-tanks, universities, thought leaders and maybe even a few bloggers.

It is time for some made in Canada and made for Canada economic and environment policy that just isn't American lite. We have done it in our social policy for years. Just look at the differences in health care, abortion, guns, public education, immigration, gay marriage to name a few.

The best chance for this to happen will be in Alberta and British Columbia because they are still exporters of commodities that beg for more local value added production and new markets beyond the U.S. As well the energy commodities produced have significant environmental issues that should and must be resolved locally and aimed at setting new planet-friendly standards globally.

Saturday, August 29, 2009

Are Canadians Losing Our Sense of Belonging?

Here is a long but thoughtful and relevant essay about how we Canadians are coming to see ourselves. Social cohesion is a key to effective citizenship. This Valpy essay courtesy of the Globe and Mail is a good reflective Sunday morning read.

Thursday, August 27, 2009

Alberta Budget Cuts Coming - Can We Do Them Better This Time?

Well we are going ot see a $430M set of budget cuts this fiscal ending March 31, 2010and a requirement for an additional $2B in the year after that. Lets hope this time we do the cutting judiciously and strategically so we maintain key programs and services, especially to vulnerable Albertans.

Already we are seeing cutbacks in departments and memos are coming out from Deputy Ministers with staff directives eliminating overtime, out of province travel and so forth. This is all consistent with the fiscal update announcements earlier this week. It should not be a surprise.
Here is a window on "yesteryear" back in 2001 and a memo from Richard Ouellet, the fellow in Children's Services who was recently found in contemtp of court. It was a cost cutting exercise then, just as we face now. Question is, have we learned anything from those past experiences? This time can we avoid the kind of damage done to kids and others like the last time government had to impose budget cuts? Time will tell, but are you optimistic?


> From: Richard Ouellet
> Sent: November 16, 2001 11:42 AM
> To: Interim - CFS10 All
> Subject:
>
> 16 November 2001.
>
> To all staff.
>
> Bill has asked me to share the following with you on behalf of the
> Management Team. As Bill mentioned in his letter to staff yesterday we
> need to continue to scrutinize expenditures to meet our budget targets.
> In order to achieve this it is critical that we continue to assertively
> implement cost management strategies that have been developed over the
> past several weeks. These strategies are based on the principle that any
> changes will not affect the safety of children.
>

It is imperative that all staff are aware of, understand and support
> these strategies. The next few months will require your help to ensure
> that we continue to provide quality and responsive services to the
> children and families we support.
>
The first phase of our cost management involved a structural review
> of our organization. While there are a few areas yet to be completed we
> have made significant progress in reducing the administrative costs of the
> Authority.
>
A second key element of our strategy was the development of a Cost
> Management document that was distributed to all NCCYFs and CFRO in early
> November. I encourage you to read the document and discuss these
> strategies with your manager and co-workers, as well as bring forward any
> other ideas you may have.
>
The third phase has been a detailed review of all contracted
> services which has resulted in the reduction or termination of several
> Agency contracts and a request for a 1% reduction in contract costs for
> the remaining agencies. While these adjustments have been difficult we
> have remained true to the underlying principles inherent in the four
> pillars of our service plan. I have provided each NCCYF and CFRO manger
> with a copy of the attached listing of Agencies who received notice of
> contract reduction or termination on November 15, 2001. I should note that
> while the notice was given yesterday the effective date for the changes is
> February 15, 2002.
>
We know there are a lot of pressures on you, your peers, on
> agencies, stakeholders and the community. These have not been easy times.
> Management is asking a great deal from you and it is important for you to
> fully understand the measures being implemented and how they will affect
> you and the people we serve. We are confident that together we can
> achieve our goals.
>
> M. Richard Ouellet


Isn't it interesting how the more things change the more they stay the same. Lets hope we are wiser this time in how we implement program cuts that in the Klein days. I am optimistic by nature but will be watching carefully to see if my faith is well founded.