Sunday , June 20 2021

As Doug Ford massively overtook Hydro One's "Six Million Dollar Man"



The "Six Million Dollar Man" saga has spread to the Hundred Dollar Pound.

That's how much money was drained at Hydro One, thanks to Doug Ford's onerous campaigning, culminating in a failed takeover offer and a $ 103 million death rate. Never did the Ontarians pay such a high price for such cheap slogans, with the meter still running in the accounts of the lawyers.

That our fearless and irresponsible prime minister could dismiss the (admittedly overstaffed) CEO of Ontario's power transmission company, without the financial consequences, has always been the subject of television fantasy. When you mix business risk with political recklessness and personal arrogance with administrative incompetence, you're on the hook for what happens.

It starts with the costs (and opportunity costs) of Siderurgia CEO Mayo Schmidt, who has given up his generous $ 6 million in annual compensation, but came out with generous stock options at our expense. This is a huge transfer of wealth for which we receive nothing but the fleeting satisfaction of issuing a pink bulletin.

Revenge is not a remedy for past grievances. Envy is not a substitute for strategy.

Ford's chief of staff, Dean French, cut off all lines of communication between the two sides. Bad enough for it to be turned into a gang-footed plate headed by a condemned CEO, our provincial transmission company was transformed into a zombie corporation for weeks while the Ford team was in their hands.

In pushing for Schmidt, Ford triggered a chain reaction in the northwestern United States, where regulators were examining the proposed acquisition of regional utility Avista for $ 4.4 billion from Hydro One. Written promises that the government of Ontario acted just like a passive investor on Hydro One were blatantly contradicted by Ford's interference, prompting the regulator to intervene.

Hence the death rate that Hydro One must pay, in addition to commissions to the investment banks involved in the financing of the business, totaling more than $ 150 million. Not to mention the massive legal accounts.

Retreating to damage control mode, the premier's office issued a written statement with rhetorical style campaign, six months after the end of the election: "I will never apologize for keeping my promises to voters. We are reducing hydroelectric rates. "

Except that the cut of Schmidt's exaggerated salary will not reduce more than a fraction of a penny from the monthly bills. Paying more than $ 150 million in homicide fees and attorney bills will cost the company much more.

Why? The satisfaction of cutting our nose (or Schmidt's can's ear) to irritate – or incite – ourselves?

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It's tempting to blame the premier alone for our crazy hydroelectricity. But this would accumulate yet another simplification in the hyperbole pile around the Hydro One.

Since the beginning of its misfortune in privatization, led by former Prime Minister Kathleen Wynne, the company was bizarrely cursed. Although I have argued against this – too much risk for insufficient reward – I never lost sleep due to the partial sale of our transmission lines (a largely passive asset), maintaining effective control with a 47% stake.

But I never anticipated the success of the New Democratic Party in provoking public antipathy to the sale, thanks largely to brand contamination: most people mistook Hydro One for the old Ontario Hydro, which had long been split into the transmission concessionaire and strategic Ontario. Power generation (still fully owned by Queen's Park).

The Progressive Conservatives, who for a long time demanded privatization, were conveniently reversed before the election to join the NDP crusade by full public ownership. In the election campaign, Ford emerged as the province's chief populist, attacking Schmidt's overcompensation with his artistic rhetoric that attracted voters – and removed the NDP carpet.

But Ford's slogan slogan ridiculing the "Six Million Dollar Man" and its new billboards proclaiming the "Open for Business" of Ontario, belies the reality that this government is bad for business and bad for Hydro's balance sheet One. Ford's pro-business rhetoric has not fooled the business press, which is interfering with its government's intervention in corporate governance, its interference in hiring and firing top executives, and its willingness to break through signed business contracts to score political points .

If a liberal government or the NDP had attempted half of the uprising undertaken by the CPs so far, the private sector would be raising shouts of banditry and Bolshevism. Fortunately for the Conservatives, they are protected by their historical affinity with the right rhetoric.

But the more clumsy his performance, the more obvious the distinction between conservatism and competence. Interfering with management is not a way of running a business, just as maladministration is not a way of governing a province.

Martin Regg Cohn is a Toronto columnist covering Ontario politics. Follow him on Twitter: @reggcohn


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