Stimulating the private sector, or not

It's been fun watching the Thompson-Wabush thingie play out.

June 6: Consolidated Thompson announces it conditional purchase of Wabush Mines [.pdf link]. The release refers to the company's prior "consultation with the Governments of Newfoundland and Labrador and Quebec and the employees of Wabush Mines." No mention is made of the role of Great Negotiator™ in the transaction. No worries though. It's covered

June 7, later: Labrador Affairs Minister John Hickey rises in the House on a Ministerial Statement:

Premier Williams engaged both Consolidated Thompson and Cleveland Cliffs, Stelco and Dofasco during the negotiating process to expedite a deal...

However, early in 2007, Consolidated Thompson announced that it had ended its negotiations on the purchase of Wabush Mines. Our government was very disappointed with that news; yet, we remained optimistic as the door was left open for future talks.

As our government firmly believed there were significant opportunities to be realized through a partnership with the operations of Wabush Mines and the Bloom Lake project, we were not prepared to give up and let the prospect of such an arrangement pass by. It was our view that a successfully negotiated arrangement would add to the life of Wabush Mines.

The Premier personally intervened and spoke with representatives of Consolidated Thompson in early February at which time he impressed upon them the benefits of continuing to hold discussions in an effort to secure a deal.

Today, we are seeing the results of how that direct intervention by our government helped to pave the way for an announcement that a deal has been reached.

June 6, moments later: Critic Yvonne Jones throws a little cold water on this version of events:

Mr. Speaker, what makes me grin in this statement is how the government is desperately trying to take credit for the consolidation of this particular deal and the purchase of Wabush Mines.

Mr. Speaker, we know that these are two very prominent mining companies in the country and I am certainly sure that they did not need the intervention of the government to see the real capital and fiscal benefits of being able to do this.

June 7: The Ministry of Truth reports the pointcounterpoint:

Tories Take Credit for Wabush Mine Sale
June 7, 2007

Government is patting itself on the back for helping secure the tentative sale of Wabush Mines to Consolidated Thompson. The company has some ambitious plans set out for Labrador West, including upgrading the mining facilities at Wabush to produce high-quality iron ore concentrate from the Bloom Lake deposit and Scully Mine at a rate exceeding eight million tonnes a year. Current production stands at under five million tonnes annually. Labrador Affairs Minister John Hickey says the deal was off the rails until government got involved. Hickey says the premier personally intervened and spoke with representatives of Consolidated Thompson, impressing upon them the benefits of continuing with the negotiations.

Liberal MHA Yvonne Jones is pleased with the sale but says government's attempt to take credit is laughable. Jones says both companies are giants in the mining world and didn't need this province to point out the benefits of such a deal.

June 10: Ngaire Genge reports for 53 North that:

[Steelworkers Local 6285 president Jim] Skinner doubts the provincial government had any real impact on the discussions. “We talked to the department, and they had no idea what we were talking about. We talked, of course, to Consolidated, and they have no idea either.”

Calls to the Premier’s Office revealed no clearer role. Said their representative, “There is no further information than is in the release.”

June 11: In an interview with The Aurora, Minister Hickey says:

Minister Hickey: Obviously there is a 90-day thing there and obviously there is a lot of due diligence that has got to be played here. But I think what Mr. Skinner and what the people of Wabush and people of Labrador West must know…this [deal] was off the rails. Premier Williams got it back on the rails and left the door opened to get it back. We have been in talks with the company [Consolidated Thompson] to encourage them to look at the Wabush option and now they have come back with a proposal to do it. I don’t understand why people have got to be negative about it. It’s a very positive story for Wabush and for Labrador West. It’s positive for the whole region. This will give Wabush Mines a whole new life. I am disappointed with Mr. Skinner’s take on it but you know at the end of the day I am certainly not negotiating this deal or involved in the negotiations. ...

The Aurora: Have you heard anything at all from Dofasco as to what their intentions are?

Minister Hickey: I have not talked to Dofasco, no.

[...]

The Aurora: Can you do anything to speed up the process…as in can you approach them and ask what their intentions are?

Minister Hickey: All I am saying is, I am not going to get down into the middle of deal not with any of these companies. I mean they will work this out themselves. I don’t think it’s my job as a minister to get into all that. What I am saying is we are very happy this is back on track and we will let the due process take its course. I think it’s great news. I know that people try to shed negative comments you know, which happens over there from time to time. But, hey, this thing was off the rails and it’s back on now. I am looking at it with a great deal of optimism.

The narrow questions out of all of this are, why would the provincial government try and claim credit, if, indeed, it had no real involvement in what seems to be a corporate transaction? Why the changing stories?

The broader question is: has it never occured to anyone, in any provincial government, of any political stripe, that if they stopped taking the credit for business success, then, over time, they might stop getting blamed, or at very least get blamed less, for business failure?