to be perfectly frank - Atlantic Business Magazine

COVER STORY
TO BE
PERFECTLY
FRANK
From shale gas to civic responsibility, tough talk from
New Brunswick’s favourite son
By Alec Bruce
16 | Atlantic Business Magazine | March/April 2013
IT IS A
BITTERLY
BRIGHT winter
afternoon in the kernel
of Toronto’s financial
district and Frank
McKenna is waiting
to hear from New
Brunswick Premier
David Alward. Some
hours before, he
had sent an email
to the province’s
chief elected officer,
offering his help on
a matter about which
he prefers to speak, if
only for this moment,
circumspectly. “I’m
just asking him if he
wants me to use it in a
speech, or an Op-Ed,”
he says. “He might
prefer just to use it
himself. I don’t know
yet. But I don’t want to
overshadow him.”
Photo credit Chris Young, chrisyoungphotography.ca
Online extras: atlanticbusinessmagazine.com | 17
It’s an odd statement from a man
who has spent the better part of 30
years happily eclipsing nearly everyone
around him—first as a three-term
Liberal premier of New Brunswick in the
1990s, then as Canadian Ambassador
to the United States in the dawning
decade of this century, and now as the
globe-trotting, absurdly well-connected
deputy chairman of TD Bank. Still, he
seems genuinely concerned. He has
what he deems is a good relationship
with Alward, and he doesn’t want to
jeopardize it by flying off the handle into
the public pepper pot. He says there’s too
much at stake in his home province; too
much to lose.
“What we are facing in New Brunswick
is a structural, secular decline,” he says.
“The problems we have don’t ebb and flow
with the quality of our leadership. There
is something more serious going on here.
We face circumstances that combine to
create a very negative outlook. The entire
atmosphere is hugely challenging.”
There is, he says, a long-term debt,
now hovering above $10 billion; a
rolling annual deficit of more than $350
million. There is “perniciously high”
unemployment; an aging population;
an exodus of entrepreneurial know-how,
innovation and durable, skilled jobs.
Worse, perhaps, for a province that has
always relied on its abundance of natural
economic assets, resource industries are
in decline.
“The resource base that remains can
be exploited with fewer workers and
more mechanization, so it can’t support
the number of workers that it once did,”
he says. “Yet, we remain a resource-based
economy in a world where the Canadian
dollar looks to be in a fairly constant state
of parity with the U.S. dollar. So, this,
too, is a peril.”
Sitting at a small conference table
in his office on the fourth floor of the
TD Centre, he speaks with his hands,
which punctuate the air with countless
gestures meant to emphasize a point
or authenticate a perspective. When he
was a boy, growing up on a farm in tiny
Apohaqui, New Brunswick, he bailed
hay with those hands. Later, as a defence
lawyer, politician, statesman, mover,
shaker, seller of ideas, spinner of dreams,
he learned to use them to more nimble
and nuanced effect. Now, he raises a
finger meaningfully as if to signal a
change in the direction of his elocution.
“Even though I think our situation in
New Brunswick is quite pessimistic, I
don’t think that it is terminal,” he says.
18 | Atlantic Business Magazine | March/April 2013
make these
make sense
During his time as premier of New Brunswick, Frank McKenna was known for his diligence in fostering relationships
with the business community in order to encourage investment in his province. Here he is shown at a business
networking event at Nova Scotia’s Fox Harb’r resort on July 27, 2006.
“There are many places in the world that
have faced dramatic challenges. In fact,
adversity, itself, became the platform upon
which they built sustainable economies.”
Look at Israel, he says. With its back
to the sea and its face to the desert
and surrounded by enemies, it has
still managed to create one of the
most technologically, and prosperous,
societies on Earth. Look at Finland, he
commands. With the fall of the Soviet
Union, it lost its major market. But it
set out purposefully to reinvent itself.
Today, thanks to its cocoon of high-tech
industries, it’s one of the few nations
in Europe keeping its head above the
f loodwaters of the continental sovereign
debt crisis.
“And, if you look around us, you’ll see
places like Massachusetts with virtually
no resource base, but a very highperforming economy because, again, of
knowledge,” he says. “Then, you’ll see
other places where the resource base,
itself, has created very strong economies
. . . So, I believe here in New Brunswick,
we are not without tools.”
He pauses and glances up. When, he
wants to know, will this article about
him appear in this magazine? “Not until
March, you say,” he muses. “Right, well,
this thing with Premier Alward should
be public by then.”
He likes the timing, and timing
is another thing Frank McKenna
understands matchlessly well.
IN A 1965
NEW YORKER
profile of college basketball phenom Bill
Bradley, who later became a U.S. senator
and Democratic presidential hopeful, the
great American literary journalist John
McPhee described the youthful forwardguard’s skills on the court as virtually
heaven-sent. One shot, in particular,
impressed him.
“That shot,” he wrote, “has the essential
characteristics of a wild accident, which is
what many people stubbornly think they
have witnessed until they see him do it
for the third time in a row . . . I retrieved
the ball and handed it back to him. ‘When
you have played basketball for a while, you
don’t need to look at the basket when you
are in close like this,’ he said, throwing it
over his shoulder again and right through
the hoop. ‘You develop a sense of where
you are.’”
Many people have made the same
mistake about McKenna—who stands
about five-foot-nine and isn’t known for
his jump shot—on the courts of politics
and public policy. Time and again, they
have watched him perform feats of
political and diplomatic derring-do before
and after his electoral victories and highprofile government postings, and time
and again they have chalked these up to
luck: tremendously, infuriatingly good
luck to his critics; but luck, all the same.
In fact, it’s his “sense of where you are”
and
you’re
there.
iParks
Moncton
Online extras: atlanticbusinessmagazine.com | 19
McKenna’s
terms of office
were marked
by the sort of
policy coherence
that’s seen in
government
only rarely these
days. He made
job creation his
number one
priority, offering
tax breaks to
companies both
large and small.
that has always been in play—and always
played impeccably.
That was evident in 1971 when, in
his early 20s, he chose the law as his
profession. He had planned to acquire a
graduate degree to complement his B.A.
from St. Francis Xavier University in
Antigonish, Nova Scotia, until a meeting
in Ottawa with Allan MacEachen, veteran
Liberal Member of Parliament at the
time and one of the canniest back-room
strategists this country has ever produced,
changed his mind. The old dog, never
at a loss for new tricks, told his “special
assistant” that if he wanted a career in
politics, he should earn an L.L.B. And
so, the young scholar obtained one,
matriculating second in his class from
the University of New Brunswick in 1974.
In fact, it was his legal career that
fused his preternatural talent for
being at the centre of things with his
genuine commitment to public service.
He took on several high-profile cases
from his shingled office in Chatham,
New Brunswick, one of which was
the indictment of local boxing legend
Yvon Durelle, who had been charged
with shooting and killing a man. The
crusading attorney’s courtroom triumph
in 1977 made him famous and, not
inconsequentially, beloved among a
significant segment of the voting public
in the province’s rural north.
Others have gone as far as to claim that
McKenna’s ability to capitalize on the
felicitous happenstances of his life—his
talent for “making it look easy”—is not
only part of his personal charm; it’s a
deliberate calculation. Three years after
his successful bid to represent Chatham in
New Brunswick’s legislature, he became
Leader of the province’s Liberal Party. A
year after that, in 1986, he was preparing
to upend the Progressive Conservative
dynasty of Richard Hatfield, which had
been in power for nearly two decades. In
his 2001 book, Frank: The Life and Politics
of Frank McKenna, Fredericton journalist
Philip Lee observed how, “The portrait of
Frank McKenna as a hard-working, cleanliving farm lad was repeated time and
again in media profiles.
“A Toronto Star reporter hushed that
Frank McKenna’s childhood ‘was a
Norman Rockwell scene, white clapboard
farmhouse in a village called Apohaqui,
He’d practise his slapshot in the barn so
noisily the cows objected and stopped
giving milk.’ On the campaign trail,
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McKenna kept his story simple: he was
just an average New Brunswick boy who
had a few breaks along the way. ‘I lucked
out on some good cases, and then a seat
came open and I ran,’ he’d say. ‘Then,
when I got there, the leadership was open
and nobody else wanted it, so I ran for
that, and here I am. Now, nobody wants to
be premier, so I’m running for that. I’ve
just been at the right place at the right
time so far. There’s nothing I’ve got that
isn’t typical New Brunswick. I’m a typical
New Brunswick boy, a little bit country
and a little bit rock and roll.’ This official
biography was a mask, and he wore it well.
In fact, there was nothing average about
McKenna’s life at all.”
Certainly, there was nothing average
about his subsequent successes at the
ballot box: Three majority wins between
1987 and 1995, the first of which was a
clean sweep of every seat in the Legislative
Assembly, only the second such
achievement for a provincial political party
in Canadian history.
In reality, McKenna’s terms of office
were marked by the sort of policy coherence
that’s seen in government only rarely these
days. He made job creation his number one
priority, offering tax breaks to companies
both large and small. He worked directly
(some say, meddled) with the private sector
to get it the skills and resources it needed
2:17 PM
to prevail during tough times. He travelled
the country to “sell” New Brunswick to
corporations looking to establish satellite
operations. He even installed a toll-free
line (1-800-MCKENNA) in his office and
invited business interests across North
America to give him a call if they wanted
to know more about his splendid corner of
the world.
By and large, the measures worked.
The provincial economy became more
diversified, more productive, more
innovative. Government finances improved.
Most importantly, though, was a palpable
shift for the better in people’s attitudes
about themselves and their communities.
It was as if McKenna had grabbed the
zeitgeist, shook it by the neck, and ordered
it to cheer up. He had seen the possibilities
lurking beneath the collective conscious
and tapped them.
Of course, not everything he did earned
applause. “It’s hard to compare eras,” he
says. “It’s like comparing hockey players
from different eras. But the circumstances
we faced then were pretty acute. We saw
a series of very deep federal cuts to all
of the provinces. At the same time, we
had an unemployment rate that was in
the middle-teens, much higher than it is
The global network of Frank McKenna (top left,
moving clockwise): accepting his Diamond
Jubilee Medal from Governor General David
Johnston on September 28, 2012 in Ottawa;
talking policy and economic opportunity with
former U.S. President Bill Clinton; chatting
with former British Prime Minister Tony Blair in
Calgary on October 26, 2007.
today. We had an unfunded pension fund,
which we inherited, at $1.6 billion, and
a large pension deficit at the Workman’s
Compensation Board. So, in many ways,
the circumstances then were just as dire
as they are today. I would say, perhaps,
they were more dire.”
At times, he says, the medicine was
bitter, indeed: “From totally restructuring
health care, reducing bed counts
dramatically, closing institutions to
reducing the size of government with
significant layoffs . . . We had frozen
salaries for a period of at least two years.
We had people in the streets, pretty much
steadily, in protest.”
But his larger point is that those who
find themselves in a position to make a
difference in people’s lives have a duty
to speak up and get busy, regardless
of any personal or professional risks.
It’s a principle he carried over into his
one-year term (2005-2006) as Canada’s
Ambassador to the United States, when
he routinely urged his fellow citizens to
be more sympathetic to their American
“cousins”, even as he blasted the
administration of President George W.
Bush, in a speech near the end of his
tenure to a Toronto business audience, for
being “in large measure dysfunctional”.
As for New Brunswick’s current
“dysfunction”, McKenna is equally plainspoken: “This isn’t just a problem of
leadership in government. It’s also a
problem of followership. Our citizens
have to understand the full depth and
breadth of the dilemma that we are facing,
and they have to be prepared to face up
to some inconvenient truths. It means
that they have to become less reliant on
government and more entrepreneurial. It
means that they have to take responsibility
for their own futures.”
It means they have to start paying
attention to the signs of the times and
recognize that the time for action is now.
MCKENNA
PLACES HIS PALMS
squarely on the table. He’s still waiting to
hear from Alward about his proposal to go
public with his opinions on one of the most
controversial industrial opportunities in
New Brunswick’s recent history. But as
the shadows of the late afternoon begin to
lengthen, he sees no point in appearing
coy. “The way I look at it,” he says, “the real
win comes when we take our indigenous
shale gas in the province and hook it into
the Canaport liquified natural gas (LNG)
facility in Saint John.”
New Brunswick’s
shale reserves
could change the
conversation about
the province’s
anemic economy
forever. They
could transform
the region into a
jurisdiction whose
wealth rivals
that of Alberta,
Saskatchewan,
Pennsylvania or
North Dakota.
Online extras: atlanticbusinessmagazine.com | 23
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24 | Atlantic Business Magazine | March/April 2013
His voice rises as his enthusiasm
peaks. “We have in situ now, calculated by
Corridor Resources Inc., 67 trillion cubic
feet of gas. That’s bigger than western
Canada. It’s a huge deposit! If 10 per cent
is exploitable, that’s enough to create a
revenue source for New Brunswick for
decades to come. All in, it would result
in about $15-20 billion in investment and
150,000 person years of work. And for
governments, it would result in between
$7-9 billion worth of royalties and taxes.”
In other words, he says, New
Brunswick’s shale reserves could change
the conversation about the province’s
anemic economy forever. They could
transform the region into a jurisdiction
whose wealth rivals that of Alberta,
Saskatchewan, Pennsylvania or North
Dakota.
“What we need to understand is that
just by the roll of the dice, we have landed
in exactly the best position on the board at
this moment in time,” he says. “We have
a Canaport facility with massive storage
and with a jetty, getting right into deep
water. We have a port that’s ice free and
has the capacity to accommodate the
biggest vessels in the world. The West
Coast can’t do that.”
More than this, he says, if New
Brunswick manages to spearhead the
construction of an oil pipeline from
Quebec, carrying Alberta bitumen
into Saint John, the combination (with
native shale gas development) would be
unbeatable: “We have the only LNG (sea)
terminal in Canada, and it’s currently
borderline economic. It’s set up to receive
imported product. But the world has
changed under our feet. Gas in Canada
now is about $3.50 per thousand cubic feet
(mcf). Gas in Europe is about $11 mcf. In
Asia, it’s about $15. Fifteen proposals exist
now in Canada to reverse LNG facilities
for exporting. The reversal of that plant in
Saint John would create an investment of
between $2.5-10 billion, creating 900 jobs
per unit, and four units could go there . . .
And so, when you put it all together, you
can see what we’re looking at.”
It is, perhaps, easier for McKenna than
most to apprehend the outline of the big
picture. Though he and his wife Julie
summer in Cap-Pele, New Brunswick,
he’s ensconced in Toronto. And when he’s
not, he’s travelling an average of 175,000
miles a year representing TD’s interests
all over the world, pressing the flesh with
renowned figures such as former U.S.
President Bill Clinton, whom he considers
a personal friend, and Wayne Gretzky.
Still, though he may no longer be as close
to his home province as he once was, he
is never very far. “Businesses from New
Brunswick contact me every week,” he
says. “They are looking for introductions
or just wanting to drop in. I am constantly
in touch with New Brunswick businesses
and individuals.”
That fact, perhaps, gives him the right
to speak forthrightly. In any case, he
doesn’t resist the temptation. He knows
just how contentious an issue shale gas
development has become in the province,
where a vocal segment of the population
worries about the potentially deleterious
environmental effects of the technology.
“First of all, there are some people
who are for this and, to them, it doesn’t
matter what the damage or what the
opportunities are,” he says. “I would
park them. Then there are some people
who are just dead against it and it doesn’t
matter what you say. And you park them.”
He thinks the Alward government
should focus on the majority—in whose
company he counts himself—who believe
that shale gas can be developed both
profitably and responsibly. The key is
effective communications, a discipline he
knows all too well both from experience
and bemused observation.
“We witnessed three or four years
ago what happened when the public
turned against a very major initiative,”
he says. “That was the sale of NB Power
(to Hydro-Quebec). Had that gone
through, it would have resulted in a
total transfer of risk, a lowering of the
provincial debt, a lowering of power rates
in New Brunswick and a greening of
our power base. It would have changed
the province’s balance sheet overnight.
It would have made New Brunswick
industry competitive overnight. It would
have been an extraordinary asset. But it
was poorly presented.”
To prevent a repeat performance
over shale gas, he says, opinion leaders
in the province must stand up and be
counted: Teachers, doctors, nurses,
educators; anyone who has skin in the
game of preserving and enhancing New
Brunswick’s quality of life. And that
means just about everyone, including,
presumably, McKenna himself.
Although he doesn’t say it, and might
never admit it, the man whom one wag
once described as the “tiny, perfect
premier at the centre of the universe that
is Canada’s picture province” is right in
his element urging, nudging, canoodling
change from the political wings. When he
left the premiership, voluntarily, in 1997,
he declared that 10 years was enough
time in office for any man or woman and
vowed never to return. He hasn’t changed
his mind.
“Let me tell you, I have had my arm
twisted now five different times about
running nationally,” he laughs. “You
know, if my life was barren, I guess the
thought would be more interesting.
But, I find that my life is just rich with
opportunity—more than I have time
for. On the philanthropic side, I’ve
been working in Haiti and Africa. For
business, I just got back from the Middle
East, where I stopped in to Abu Dhabi,
Qatar and Kuwait. I’ve just been asked to
go over to Beijing, Singapore, Hong Kong
and Seoul in March.”
And then there’s his beloved New
Brunswick.
“I find I can just do so many more
things now,” he says. “I can even help the
government of the day in any way that I
can, supporting its initiatives, opening
doors.”
And sensing, with the timing of a Rolex,
exactly where he is in the cosmos known as
Frank McKenna. | ABM
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