Workers in Hard Times: A Long View of Economic Crises

9. Want amidst Plenty: The Oil Boom and the Working Class in Newfoundland and Labrador, 1992-2010 Se

9 Want amidst Plenty The Oil Boom and the Working Class in Newfoundland and Labrador, 1992–2010 sean cadigan Newfoundland and Labrador, the easternmost province of Canada, had long been the poor cousin of Confederation.1 By 2008 this all changed, as Newfoundland and Labrador became a “have province” within the Canadian system of calculating federal transfers of income to poorer provinces. Since 2000, average personal incomes have increased steadily, and the unemployment rate has dropped. Much of this good economic fortune has been attributed to the cyclical but steady rise in total oil production from the province’s offshore oil wells since the first Hibernia project began production in 1997 (see map 9.1). The province’s gross domestic product (GDP) has been rising steadily since 2000, and the province has weathered the current international recession better than any other jurisdiction in North America. The transition from “have not” to “have” status was, according to the provincial premier Danny Williams, “a momentous day for the people of this province,” and his finance minister, Jerome Kennedy, stated that these people no longer had to suffer national perceptions of them as “second-rate citizens, or Canada’s poor cousins.”2 Despite the hoopla, the oil boom could not transform overnight serious environmental , economic, and social problems that have been plaguing Newfoundland and Labrador since at least the 1970s. The limits of the boom are apparent from the experience of working people. Outside of the region surrounding St. John’s, the provincial capital, skilled working people have continued to leave the province due to ongoing crises in the forestry and fisheries sectors. Direct employment in the oil and mining sectors is too limited to compensate. Indirect employment has largely been in the service sector, especially in jobs dominated by underpaid and poorly represented women, who have faced significant ­ impediments to gaining access to skilled work or representation by unions. The oil boom has further contributed to a neoliberal policy of dividing unions, especially in the public sector. Before 2005, provincial governments attacked unions largely for purposes of retrenchment. From 2005, growing oil revenue has allowed the provincial government to spend more, but by downloading the costs of some new initiatives onto public-sector unions and fostering lucrative but disruptive collective agreements in ways that appear divisive on a gendered basis. The persistence of want amidst plenty on a regional, class, and gender basis has fractured the labor movement, limiting its ability to respond to the problems of the oil boom. Map 9.1: Newfoundland and Labrador (NL): Major Offshore Oil Discoveries 188 . sean cadigan The Uneven Geography of the Oil Boom TheoilboommustbeunderstoodinthecontextofNewfoundlandandLabrador’s particular political economy. A cold-ocean region of boreal forests and tundra, Newfoundland and Labrador experienced none of the agricultural settlement and related manufacturing development that, to varying degrees, fostered economic growth in the neighboring regions of North America. Early Europeans had come to Newfoundland to fish; with little prospect for import substitution or significant alternative landward economic activities, fishing people remained dependent on merchant capital and the Atlantic markets of the cod trade. Its Atlantic orientation meant that Newfoundland rejected union with Canada in the nineteenth century. Successive colonial governments attempted economic diversification through great public investments in railway development and by protecting local manufacturing. Such efforts failed to significantly diversify the economy, although they contributed to massive public debt. Governments were more successful in using subsidies, favorable royalty rates, and tax exemptions to attract foreign capital to forestry and mining. Employment in these industries was important but did not lessen overall dependence on the fishery. By the early 1930s, Newfoundland and Labrador continued to rely on staple production amidst collapsing international prices for its exports. The limited manufacturing that had grown in the capital, St. John’s, relied on fishing people as markets, but their capacity to consume waned with the depression of the period . Terrible unemployment and poverty worsened already-staggering public debt; concomitant social unrest led to political crisis and the collapse of responsible government between 1932 and 1934—government by a British-appointed commission from 1934 to 1949 and union with Canada in the latter year. From 1949, provincial governments tried to lessen dependence on the fishery with little success; Newfoundland and Labrador remained the poorest province in Canada. Resource depletion characterized the fishery and forestry, encouraging the concentration of capital and leaner forms of production by the 1980s. Such changes failed...