Monday, February 6, 2012
Quebec's latest Crisis Nothing to do with Language
Somehow few seem panicked, least of all, the government.
While the rest of Canada saw the unemployment rate dip marginally, the loss of jobs over the last six months pushed the Quebec rate up a staggering 2 percent to 8.7%.
This while the country is supposed to be in recovery.
In fact, during this period Quebec lost a staggering 50,000 jobs while the rest of the country added 250,000!
In hindsight, the closure of the Shell refinery in east end Montreal a year ago, heralded the beginning of an unprecedented spate of closures, lockouts and shutdowns that has decimated Quebec's manufacturing base and which continues unabated.
The closure of the Shell refinery was brought on by union excess that saw the plant suffer from pitifully low productivity, coupled with overly generous salaries and conditions.
Sadly, unlike other companies which cannot compete paying high 'Quebec' salaries, the refinery would have remained functional had the union acted more responsibly.
But that being said, the handwriting is on the wall for Quebec's manufacturing base. Salaries and operating costs in Quebec are just too expensive compared to the Orient, Latin America and believe it or not, even the United States.
The Electrolux vacuum cleaner manufacturing plant is off to Tennessee where workers will make about ten dollars an hour less than in Quebec and where the costs related to employee benefits are considerably lower.
MABE, a plant producing dryers announced that it too is moving its 700 jobs to either Mexico or the United States, the union pushing the fiction that it is America's 'Buy American' plan that made their product unattractive, rather than the real reason, the higher manufacturing costs associated with Quebec.
These latest closures continue the decline that started back in the seventies with the move overseas of Quebec's robust sewing industry. Back then, seamstresses were pulling in a healthy hourly rate of $15 an hour, which is probably equivalent to $30-$40 an hour today.
All this is coupled with Big Pharma scaling back research, after years of growth in Quebec. Last week AstraZeneca announced that it will eliminate 175 jobs and with recent layoffs at Johnson & Johnson, Merck and others, it means that another 1000, more than decent jobs, are out the window.
And so these well-paid workers, now jobless, are left to the dole, forced to exit the province or obliged to scrounge around with nothing but McJobs available.
Is this the future?
Is Quebec on the road to becoming a Detroit, having lost it's competitive edge and relevancy?
I hope not.
Sadly, Quebecers remain mostly ambivalent to these economic body blows and somehow, it doesn't seem to matter, or in fact, even register with those who seem more interested in debating an accent on the sign of the METRO supermarket chain.
The province has got to find a way to maintain decent paying jobs, otherwise we will see that as the unemployment rate rises, coupled with a drop in remuneration for the remaining jobs, a catastrophic loss in government revenues, impacting the province's ability to support its bloated social programs.
I don't want to sound like an alarmist, but if things don't change, we are headed for a meltdown.
The equalization program that brings Quebec about eight billion dollars a year is up for re-negotiation in two years and like it or not, Stephen Harper will be sitting on the other side of the table. If that program gets modified to the detriment of Quebec, it will be an unmitigated disaster.
With the province approaching it's debt ceiling rather quickly, anyone who can do math, can see an impending economic and social disaster unfolding.
One way or the other, Quebec needs new revenue streams, probably in the neighborhood of ten billion dollars, otherwise we can all start learning Greek.
The question remains - How to create wealth?
While Quebecers continue to demand the good life, they fail miserably to understand that wealth creation is the key to prosperity.
Let us shunt aside union extremism, poor productivity and the nanny government, realities that unfortunately aren't' going to change soon or ever.
Is there anything to be done?
Premier Charest has proposed just about the only thing that can save Quebec from itself, called LE PLAN NORD, an aggressive program to tap into the province's vast natural resources.
It is probably Quebec's last path towards salvation, but you wouldn't know it by the lukewarm reception it has gotten in the Press.
Jobs in the resource field are golden, a virtual gold mine, if you'll pardon the pun.
Quebec enjoys vast caches of gold, nickel, cobalt, platinum, iron and ilmenite and yes, even oil and gas, all waiting to be lifted from the ground.
Up in the Abitibi region, Quebec's largest mining region, jobs in the eight currently operating mines pay up to $70 an hour, with the company making plenty of money to boot.
The jobs are so enticing, that 70% of the classes of area colleges are filled with females, the men long gone into the mines!
Quebec's vast territory provides a wealth of natural resources, ripe for development, but the biggest obstacle is Quebecers themselves, who have no sense of urgency over the matter.
A powerful environmental and native lobby have partnered with radical nationalists to stall these plans.
The government, in the face of opposition has already put a halt to fractional gas drilling, with no plan or timetable to safely pursue this valuable resource.
The border dispute between Quebec and Newfoundland over the 'Old Harry' oil field in the Gulf of St. Lawrence seems to have been settled, but nothing concrete has been undertaken to get production underway.
More studies and wasted decades.
It has been proposed that the largely uninhabited Anticosti island holds 30 billion barrels of oil (3 trillion dollars at today's current price of crude) yet again nothing seems to be done to develop these resources very quickly.
There are currently 35 mining projects in various stages of planning, a number that exceeds Quebec's 25 currently operating mines.
The wealth that these projects could bring is staggering, yet all we hear in the Press is the demand for more studies and delays.
It seems that every single project is subject to five, ten or fifteen year delays.
Nobody seems to care, the initiative to create wealth, relatively unimportant.
Why? Because Quebecers have been used to getting something for nothing.
Vast borrowing and equalization payments have insulated us from believing that we must produce wealth in order to support our lifestyle.
After just two or three generations of being a something-for-nothing society, Quebec has become the proverbial welfare family, permanently on the dole with no industrious desire as long as money is for free.
With so much potential, the province remains lazy, uninterested and disconnected.
The most important question is not whether will we change, but rather whether we can change.
Posted by Editor on 2/06/2012 12:00:00 AM