Hey there, time traveller!
This article was published 3/2/2011 (2209 days ago), so information in it may no longer be current.
Do the right thing.
It’s what the public expects of government. It’s what government often tries to do. It’s also what government fails to do because sometimes, the right thing is the wrong thing if you want to stay in government.
The federal Conservative government is facing two issues in which doing the right thing will produce two entirely different political results.
In the first example, it appears the federal government will indeed overrule the CRTC, which had quashed unlimited data plans now offered by some internet service providers.
The decision was widely seen as a capitulation to the biggest ISPs, which have been trying to crush smaller providers who use unlimited data as their primary marketing tool.
The decision was expected to dramatically increase the cost of internet service for all Canadians.
The CRTC decision was a travesty. Informed industry insiders have pretty much debunked the big ISP companies’ claims that they need to end unlimited data to survive.
Among the most eloquent is Hugh Thompson of the website Digital Home, who in a column for The Globe and Mail pretty much lays to rest the industry’s claim that increased demand requires massive increases in per-GB rates.
Thankfully, the Tories are on the issue and in a decision sure to be seen as both doing the right thing and the right political thing, they have threatened to overturn the CRTC edict, as is their legal right.
It is the right thing to do because Canada already suffers under the least competitive, most highly priced wireless and ISP market in the world.
But it’s also a political coup because just about everybody except the boards of directors of Shaw, Bell, and Rogers will love the Tories for doing it.
Unfortunately, the Tories are faced with another major decision that will test their resolve to do the right thing, even if it is politically dicey.
The Tories are unleashing a $35-billion national shipbuilding program that will provide Canada with new frigates, research vessels and ice breakers. It will roll out over 30 years, and spin off hundreds of millions of dollars in economic benefits. Announced last summer by Defence Minister Peter MacKay, the program would in effect lead to the establishment of two "national shipyards" where all of the largest vessels, both military and civilian, would be manufactured.
Here’s the rub: there are more than two big shipyards in the country.
The shortlist for the lion’s share of the work includes major shipyards in British Columbia (Washington Marine Group in Vancouver), Quebec (Davie Yards of Levis) and Nova Scotia (Irving Shipyards in Halifax).
If Ottawa sticks to its guns and chooses only two of the three, then we’ve got ourselves a regional political firestorm.
The Tories continue to lag in support in Atlantic Canada, and British Columbia is the only province in the West where the Tories do not eclipse opposition parties.
And then there’s Quebec. The Davie Yard is near Quebec City, where a goodly number of the Tory MPs hold seats.
But what’s the right thing? Many analysts believe previous federal shipbuilding programs, which scattered work over many shipyards, have created an industry that is spread too thin to survive.
Another school of thought suggests that Ottawa gets a much bigger bang for its shipbuilding buck if the work is concentrated in two larger yards that can take full advantage of economies of scale to squeeze more value out of the contracts.
Ottawa’s stated intention of creating two national shipyards is a bit of tough love for the industry. It is a message that not unlike the beer companies, it sometimes doesn’t make economic sense to spread out your manufacturing plants across all the provinces.
In other words, just because there are three large shipyards in Canada doesn’t mean that Canada can support three large shipyards.
Do the right thing in shipbuilding, and it could cost the Tories dearly in the next election. Do the right thing in the war between internet service providers, and the voting public will love you.
Ain’t governing grand?