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Politics,businessdon’t mixMaiMansellEDMONTON (CP) - A string of.failures of companies backed by the Alberta government is testimony to the dangers of mixing business and politics, says an economist.“Maybe the biggest lesson to be learned from tto is what happens when there is a political element,” says Robert Manseil of the University of Calgary.The Conservative government, which has invested heavily in diversifying Alberta's energy-based economy, has been plagued all spring by one bad-news announcement after another about plant shutdowns and layoffs.Meet recently, NovAtel, a government-owned cellular phone company, announced it woula concentrate its operation in Lethbridge by shutting its Calgary manufacturing plant and laying off 340 people. Tt had earlier laid off 222 in Lethbridge.Earlier, a magnesium plant in High River shut down after defaulting on a IlM-railiion government-backed loan, throwing 145 people out of work.NovAtel and Magnesium Canada are among 30 government-backed businesses which have either collapsed or are likely to run up big losses which will be picked up by the taxpayers. Almost ? 1.3 billion is tied up in the companies.NDP Leader Ray Martin calls it proof the Conservatives’ diversification policy is in latters.“Wliat else would you call it when you've lost $1.3 billion1? he asks. ‘‘That’s a lot of wasted opportuni-. ties.But Mansell says it is more a matter of politics getting in the way of business sense. He says it is a good bet Ue goverameDl’s involvement in roost failed firms stemmed from political rather than economic reasons.The list of troubled companies, which account for almost half the ventures the province has back-stopped, include a handful of high-tech firms, various food processors. a life insurance company, a steel plant, a spring water supplier aid a couple of forestry companies.According to leaked cabinet documents, in one case the government paid $200,000 to keep a failing motorcycle helmet manufacturer afloat — simply to ward off criticism in the media.Even companies that have no connection with the public purse are blaming their woes on government interference.Canada Packers, in shutting meat-packing plants in Calgary and Lethbridge last month, blamed unfair competition from govern-meet-owned Gainers Inc.The province seized Gainers from millionaire Peter Pocklington after he defaulted on a government loan.Alberta has guaranteed more than 60,000 loans worth more than (2 billion. They range from student loans and farm aid to the secretive export development loan guarantee program.Defaults cost Alberta taxpayers more than $200 million last year. The New Democrats estimate one in every three dollars the province invests in business development goes to cover bad debts,Mansell, who co-wrote a book onIt is lt;changes Ted i says c started toe ad departs locatedmall.Work mer locLam miroom I House' vstpb I Serviciand on iAero Flowei the re*Hobblerung reMCC ahead; vacate Canad inmal The into a grocer That S' rior ecMilt quieti; annivi Re/M Ltd. -over t Bo It w and i didn’t Anc old di: that t offici; office dosa In closewediArneido mtion.A :MothpartiAuto Kale H out CenthostvainThFridinalwChfichaia.ice i Wife ley, Fi ROSiderwinwillZayherHtheviaageElkB197'lintdej
Newspaper Details
Lethbridge Herald
Lethbridge, Alberta, CA
Mon, May 06, 1991
Page 7
Full Page
Clipped by
Chinook A.
AB, USA 19 Oct 2022
Other Publications Near Lethbridge, Alberta
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