THE NEWFOUNDLAND QUARTERLY :: ONLINE EXCLUSIVES
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Online Exclusive for #428 The post-Soviet community forms a tiny minority in St. John's — only 0.3% of the total population in 2001.1 Gone are the days when Newfoundland was one of the major Canadian immigration gates, as flights outbound from the Soviet Union and other East European socialist countries to Cuba and Latin America rarely traveled without a few passengers who decided not to return to the plane after its stopover in Gander. Still, people from the countries of the former Soviet Union might be startled to find several parallels with their home. For example, though fog, rocks and ocean might amaze someone raised in the plains and forests of Eurasia, they would not likely be much surprised by the outcome of the October 2007 provincial election and the landslide victory of the incumbent Premier and his Progressive Conservative party, resulting in an absolute majority of 91.7% of the seats in the House of Assembly.2 The opposition Liberals and NDP have been relegated to four seats, lacking the ability to impose checks on the ruling majority. Such overwhelming victories are common in post-Soviet countries. In Kazakhstan in August 2007 the presidential political party, Nur Otan, received 88.4% of the vote, securing control of all seats in the national parliament, the Mazhilis.3 (Kazakhstan may be known in Newfoundland due to oil industry interactions, but is more likely recognized as the native country of Borat, a journalist with an exaggerated sense of national pride, portrayed by Sacha Baron Cohen4). After the December 2007 election of members of the lower house (State Duma) of the Federal Assembly in Russia, the pro-presidential party United Russia gained control of 70% of the seats.5 At the regional level, a situation very similar to that in Newfoundland can be observed in Kuzbass, in West Siberia, where a strong leader supported by a political bloc controls 94% of the Soviet, the regional legislature.6 Kuzbass, the home of the coal industry in the Russian Federation, also shares with Newfoundland a heavy reliance on natural resources as a principal source of income. Resource rents — profits generated by a bounty of natural resources (oil, gas, coal, ore, but also timber and fisheries) and appropriated by the government — make the government less dependent on citizens' willingness to pay taxes and cooperate in other forms. Sometimes governments appropriating significant resource rents are even able to pay their citizens; for instance the government of Alberta sends "resource rebate" cheques to local taxpayers (amounting to $400 per household in 20057). Political economists argue that the abundance of resource rents decreases the government's incentives to maintain and strengthen the institutions of democracy. In fact, autocratic regimes are notoriously stable in countries whose governments manage to extract the biggest resource rents.8 Another possible explanation for the comparable political circumstances of Newfoundland and post-Soviet countries is the particularities of catch-up modernization. Many Newfoundlanders feel that their province has been stripped of its resources without getting its fair share of investments that would guarantee sustainable socio-economic development in the future. The government of Premier Danny Williams promises to reverse the trend. Post-Soviet Russia is also catching up: the target is the level of GDP in the poorest "old" member of the European Union, namely Portugal. The gap, as former President Vladimir Putin promised in 1999, is indeed narrowing. There is a reverse side to the coin of catch-up development. Such catching-up requires mobilization of the population around the leader in unconditional support. All political, social and economic resources must be utilized, resulting in a weakening of the usual checks and balances of political power. The experience of Soviet industrialization in the 1930s, another large-scale project of catch-up development, teaches us that the concentration of unchecked powers and resources in the hands of a few creates a danger of their using them first and foremost to strengthen their own power, and only then to carry out other projects, be it gigantic steel mills and mines in Siberia or large-scale oil exploration and production projects off the Grand Banks. Social mobilization is often characterized by a dichotomy between Us, people from here, and Them. Russian nationalism has been on the rise since the late 1990s, not co-incidentally the start of the most recent wave of catch-up mobilization in that country. People from Caucasus are a target of everyday harassment and violent attacks by Russian nationalists and even ordinary Russians. The more resources the "mobilized" people get, the more chances for radicalization of what initially seemed a "soft" nationalism. The history of Canada has its own example of this scenario: legitimate demands for more national autonomy and empowering of French-speaking Canadians took radical and violent forms exactly at the time when Quebec made significant progress in catch-up socio-economic development. The late 1960s was the time of the 1967 World Expo and ambitious industrial projects successfully carried out by Hydro-Québec (one of them, the Churchill Falls power plant — Hydro-Québec "wired" it to customers in the Québec and US markets — is infamous in Newfoundland, to be discussed further below). Yet it ended with the October 1970 crisis and the invocation of the War Measures Act. Catch-up development with removed checks and balances strengthens preferences for ambitious and risky projects. Cross-national studies indicate that "the choice between regimes of autocracy and democracy is conceptually equivalent to a choice between high-risk-high-return and low-risk-low-return technologies".9 In other words, the removal of checks and balances might facilitate a "big leap forward", but it might also produce a disaster. Even if political leaders who get carte blanche from the population do not abuse unlimited powers, many opt for projects promising the highest returns in the short-term (preferably those that can produce significant outcomes before the next election). These projects are in most cases the riskiest. After all, the desire of the Smallwood government to build the Churchill Falls plant as soon as possible — the largest in Canada, construction was accomplished in just five years, actually even before the deadline — turned out to be a disaster for Newfoundlanders in the long-run. As a result of the Smallwood government's haste, important legal aspects were overlooked and mechanisms of bi-lateral price adjustment were omitted. As a result, after two "energy shocks" in the 1970s, Newfoundland lost most of the revenues that were expected to change its "have-not" status more than two decades ago. And the province will continue to pay the price of that government's ambitions until 2024. The contract that paved the way for the construction of the Churchill Falls plant was signed without public oversight in a situation in which Premier Joseph Smallwood enjoyed total control over both legislative and executive branches of power. Gerry Oppenheimer, then the PC opposition leader in this province, warned that "the people of the province of Newfoundland and Labrador don't know what exactly are the conditions of the Letter of Intent. The people of Newfoundland and Labrador have not been informed what guarantees there are that Churchill Falls will be developed to bring maximal benefit to this province in terms of revenues, industry and employment".10 It went unnoticed and unheeded. The local newspapers seemed to be too impressed with the scale and scope of the new development to pay attentions to such "minor" issues as terms of the contract signed between the British-Newfoundland Corporation (BRINCO, the provincial government's concessionaire) and Hydro-Québec. Almost all articles covering the Churchill Fall project published in July 1967 when the construction actually started remind the reader about its parameters — 6,000,000 horsepower, a 1,000 foot sloping drop, $700,000,000 expected budget, etc. — and remain silent about the exact terms of the contract.11 At first sight, the provincial government and the population should, to all intents and purposes, consider each other as a part of Us in the case of development through mobilization. But a closer look reveals that ambivalence characterizes the relationships between the two. Indeed, the government transforms into an agens movens of development against Them. Yet if the government fails to make a "big leap forward" fairly quickly, then it runs the risk of becoming the object of hatred, the scapegoat responsible for broken expectations. The Smallwood government was ousted from office in November 1971 at a time when it appeared that the Churchill Falls project was a liability for the province rather than a source of additional revenues and employment. Local newspapers said very little about the start of power generation at the Churchill Falls in December 1971, which strongly contrasted with the first-page extensive coverage of the start of the construction in 1967.12 Times had changed and so had the public's perception of the government. Once again, a parallel can easily be drawn between the interplay of attraction and repulsion in the two contexts of catch-up development, Soviet and Newfoundland. The government has been the key actor of catching up in both cases,13 initiating the processes of industrialization and urbanization (in Newfoundland, the latter took the form of three government-sponsored and driven resettlement programs between 1954 and 197514), as well as a large number of gigantic stand-alone projects, oscillating, in the public mind, between love and hate. Living in a totalitarian state, the people of the Soviet Union and its East European satellites only got a chance to express their hatred for the state in the late 1980s when the government's grasp over their everyday lives weakened. And sometimes that hatred took extreme forms. In December 1989, for example, Romanians went as far as to lynch their dictator, Nicolae Ceausescu, whom they viewed as the source of all problems and frustrations. The statesmen are simultaneously "in" (among Us) and "out" (among Them, because they are "above" society). This position potentially makes them perfect "scapegoats".15 In the final account, the Russian example seems instructive from the point of view of the dangers that Newfoundlanders could face in the not so distant future. The only problem is that after the loss of the strategic advantage of Gander International Airport — modern aircraft do not need to refuel in trans-Atlantic flights — there are fewer opportunities for getting post-Soviets here to teach about these dangers. Anton Oleinik is an economist and sociologist at Memorial University. The author is grateful to Theresa Heath, Sheryl Curtis, and Joan Sullivan, the Newfoundland Quarterly Managing editor, for useful comments and suggestions at the stage of editing. 1 Statistics Canada, "Population by selected ethnic origins, St. John's (2001 Census)" Back to Online Exclusives main page. |
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