What Recession? Venezuelans Swamp Trinidad, Eggs and a Revolutionary Health Clinic
February 6, 2023 Volume 3 # 43
Recession: What Recession?
Those cheery folks at the International Monetary Fund say there will economic shrinkage in only a few countries, Britain, Sweden and Chile among them.
There could still be a technical recession in some counties, if there are two straight quarters of (tiny) negative growth. There are jobs to be had across the rich world. If restaurants, shops and factories are advertising for people, how can there be a recession? Maybe I’m a simpleton who is missing something.
The Ingot Indicator
One odd indicator I look at is the pile of aluminum ingots stored in Brockville, Ontario. On a two train rides this past week the place was covered in them.
There were even more on the other side. There are two aluminum fabricating plants nearby, one across the St. Lawrence River in New York State, the other in Kingston, Ontario. Someone must want all that aluminium to make something.
No One Can Predict The Future….But…
What about the first week in January theory?
It says if the US stock market was negative last year— and the S&P 500 was off 19.44% in 2022— then you look a first five trading days of the year. If the market is up more than 1.4% then prepare for an up year. In the first five trading days of 2023 the market was up precisely 1.4% and 6.2% for the month of January. Every time that happens the market rises, say fans of the theory. But as anyone who has played Backgammon or Craps knows: The dice do not have a memory.
Fried Eggs
Egg prices in the United States are at a record. Why? Avian flu is killing some birds and the price of feed is high, in part because of the war in Ukraine. It is a global market. A piece in the New York Times says people are not cutting back in spite of the higher prices.
Winter doesn’t help. I have nine laying hens and they are only laying one or two eggs a day. That would be seven or eight a day in the spring, summer and early fall.
There are stories of people buying chicks hoping to get free eggs. Good luck. They don’t start laying until they are 18 to 22 weeks old.
Venezuela to Trinidad and Tobago
Just seven miles of Caribbean water separate Venezuela and the main island of Trinidad at the narrowest point in the northeast.
Both are countries rich in oil; but one is prosperous and the other is almost a failed state. It is estimated there are as many as 40,000 refugees from Venezuela, according to a study by the London School of Economics. Many Venezuelans take the hazardous Bocas del Dragón, Seerpents Mouth, in the southwest.
A friend from Trinidad and Tobago tells me his brother, a mildly prosperous man, but by no means rich, has a Venezuelan woman working in his family’s house. She and her family are among the Venezuelans who have moved to the English-speaking island in the last few years, as Venezuela descends into economic chaos.
Venezuela is a a huge country of 28-million people. Its per capita GDP is US$5,178, though that IMF chart higher up shows Venezuelas’s economy growing this year. Here is a map from the CIA Facebook superimposed over Eastern North America
Trinidad and Tobago is rich, with a GDP per capita of US$23,0000. It has a population of 1.4-million on two islands. Here is the CIA comparison overlay
Trinidad and Tobago has the highest concentration of Venezuealan refugees, most of them illegals. The LSE study points out those illegals have trouble finding work and sending their children to school. The Trinidad Coast Guard tries to stop the small vessels, but most get through. The immigration is already changing life in Trinidad: my friend’s brother is learning Spanish.
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Amazing who Still Smokes
Russia I can understand, but Germany? Must be the old East Germany.
Happy Third Birthday Poppy
Essay of the Week
This is the next chapter from my book on Harry Steele. He has just bought Eastern Provincial Airways, EPA, from the Crosbie family of Newfoundland. It would form the start of his business success. All his life he wore an EPA tie.
But first he had to deal with the pilots.
The Pilot’s Strike
Overdressed, oversexed, overpaid bus drivers.
A quote about EPA Pilots often attributed to Harry Steele but in fact spoken by an EPA board Member
There was no greater test of the mettle of Harry Steele than the pilot’s strike at Eastern Provincial Airways. It was a battle fought first at the negotiating table, then in the media, and finally on the front lines of EPA’s operations. The pilots were members of CALPA, the Canadians Airline Pilots Association. It was a strong union and had won many battles over the years, in particular with Air Canada, which had caved into demands and short strikes over the years.
Takey is a Harry Steele word. It is not in the Oxford English Dictionary, but Harry offers a clear definition for it: a takey is someone who wants more than their share and digs in to get it. He saw the pilot’s union as a bunch of takeys.
Harry Steele decided he would not give in. When it was reported that he called the pilots “glorified bus drivers” — though he denied he was the one who said it — the union stepped up its war of words. They underestimated their adversary. The man from Musgrave Harbour was not for turning.
Every reporter who covered the EPA strike latched on to the bus driver story. It immediately portrayed Harry Steele as the callous boss ridiculing his striking employees. But it might have struck a chord with the public who knew airline pilots were making more than double the average wage and then some.
The reality is Harry never said it. In an article written by David Napier in 1996, Harry went out of his way to deny the legend. Napier describes the meeting at Harry’s office: “It’s not that I am trying to run away from those words, it’s just that I didn’t say them,” says Steele, as he bellows to his assistant, “Veronica! Get me the overdressed, oversexed bus driver file.”
Moments later, Steele is pulling newspaper clippings from a manila folder that prove he never dubbed striking airline pilots at his old company, Eastern Provincial Airways, a bunch of “overdressed, oversexed, overpaid bus drivers.” It sounds like something the outspoken Steele, who has had more than his share of union dustups, would say but the words weren’t his; EPA board member Jean Claude Hebert uttered the infamous phrase that brought negotiations with the pilots’ union to a fever pitch back in 1983. The comment, however, has now become entrenched in Steele legend.
Here is a public notice put out by the company, under the photograph and signature of H.R. Steele, president and chief executive officer. It explains the situation in clear, direct language:
The Eastern Provincial Pilots Strike
On January 27th, 1983 when the Management of Eastern Provincial put a two-year offer to its jet pilots of an increase of 14.6 percent along with a request which would have increased hard flying hours from an average of 51 per month to 55 per month, the Company’s CALPA pilots stopped work and went on strike.
The increase in hard flying hours requested by the company is far below the Department of Transport limits of 120 hours.
It was intended by CALPA that the strike action of January 27th would shut down the Airline and cut off services to places like Labrador, [the] Magdalen Islands, and St. Pierre and Miquelon, whose residents depend entirely upon the airline for transportation.
They thought the shutdown would raise such a public outcry and put such financial pressure on the Airline that, at any cost to the public and the Company, we would be forced to accede to their demands.
Instead of accepting this shutdown, we informed CALPA that:
Long range survival of the Airline required improved pilot productivity, during the strike we would operate the airline, and if the strike were protracted, we would hire new pilots.
One month after the strike had begun, with 40 percent of the schedule in operation, the Company began the process of carefully selecting and hiring new pilots. As of today, May 2nd, this process continues. Scheduled operations have reached 70 percent of normal and new pilots are on the payroll. We expect to fly 100 percent of the schedule by summer.
CALPA now wants us to get rid of the new pilots. Our position is, they came to us in good faith to carry out our obligation to satisfy public convenience and necessity as required by our licences. They have lived up to their end of the bargain, and we will live up to ours.
A Philosophy of Work
Newfoundland Capital Corporation continues to stand behind the following philosophy of work for the employees of all its Divisions.
Our obligation to protect jobs for all employees imposes a requirement not to accede to inordinate demands of some employees.
The airline industry is in serious trouble and will continue in serious trouble until airline fares and airline costs fall to the level which the public is willing to pay.
Costs can be lowered either by layoffs or by increased productivity. The Company will stress productivity because it has the minimum cost and the maximum benefit for everybody, the public, the shareholders, all employees, including our pilots.
That was one side of the story. The pilots looked at things another way. You could argue that the pilots were winning the media war, in the local press and on national television. Here are two examples, the first from Jo Ann Napier’s article “Strikers have ‘drawn the line,’” published in the February 3, 1983, edition of the Halifax Chronicle Herald.
“Safety aboard Eastern Provincial Airways (EPA) flights could be compromised by union acceptance of management proposals,” the spokesman for striking EPA pilots said Wednesday.
During a press conference in Halifax, Captain Keith Lacey said the 92 pilots who went on strike Jan. 26 have “drawn the line” with contract concessions over working hours, daily duty times, and rest periods.
The news conference followed announcements that EPA has contracted out pilots and equipment from Austin Airways of Timmins, Ont., to handle “essential” flight services.
“You don’t hold the pilot profession up for ransom just because times are hard,” said Capt. Lacey, adding that striking members of the Canadian Air Lines Pilot Association (CALPA) will not waver in their bargaining stance.
“It is the passengers who have been held hostage by CALPA,” countered EPA spokesman Merv Russel, during a telephone interview from Gander, Nfld.
He suggested EPA clientele who rely on the “essential” services provided by the regional [airline] were placed in a difficult position by the pilot’s strike.
Mr. Russell noted that management opted for a “moderate stance” in the dispute by contracting out, rather than hiring, the Austin Airways pilots.
He disagreed with suggestions that safety standards may be threatened by the company’s proposal to increase EPA pilots credited flying time from 80 to 85 hours per month.
“Eighty-five hours per month is certainly safe,” said Mr. Russell, adding that pilots at Nordair carry that workload, which is within Ministry of Transport guidelines.
But the union spokesman said the company proposal is “just a case of asking for too much, too soon.”
“There are some limits, and we’ve reached most of those limits,” said Capt. Lacey.
Regarding EPA’s move to bring in outside pilots, Capt. Lacey said it is “unfortunate” the company deemed it necessary to bring in outside people rather [than] try to settle the dispute.
EPA has contracted Austin Airways pilot three flight routes and to provided its own Hawker Siddeley 748 turboprop airplanes for one of those flights — from Montreal to the northern New Brunswick towns of Chatham and Chario.
On March 31, 1983, Harry Steele and Keith Lacey went toe to toe on The Journal, a nightly television program that aired after The National. (The author worked on The Journal at the time.) What follows is an exact transcript of that interview. HS is Harry Steele; KL is Keith Lacey; PK is Peter Kent; and MF, Mary Lou Finlay, the main interviewer.
The verbatim transcript of CBC Journal interview of Harry Steele and Keith Lacey:
MF: Five weeks ago pilots at Eastern Provincial Airways went on strike cutting Atlantic services in half. The labour dispute has degenerated into charges, counter-charges, name-calling and rebuttals in newspaper advertisements. What’s surprising about the bitterness of this strike is that the two sides never seem to be too far apart.
PK: With no settlement in sight, Eastern Provincial Airways took matters into its own hands this week hiring pilots to replace those on strike.
[Video showing strikers hitting Tilden rental van with hammers and axes: “C’mon, you bunch of scabs.”]
PK: The first eight pilots arrived for work in Halifax where they were met by picketing EPA employees.
EPA’s high-flying, free-enterprise boss, Harry Steele, says the pilots hired through the strike will stay with EPA and that those still on strike will have to take their chances of finding jobs when the strike is over. The central issue in the strike is productivity. The company wants to increase the number of hours the pilots fly from eighty to eighty-five hours a month and to reduce time between flights.
In the fight for public sympathy, both sides took their case to the public with newspaper ads. The company took out this one, which says pilots are only working fifteen days a month and the company is asking for just one more day’s work.
The man behind Eastern Provincial Airways is Harry Steele. He took over the perennial money loser five years ago and turned the carrier around to record a profit last year. The pilots argue that the profit column shows the airline is already more productive than most and while the pilots have shown a willingness to be flexible, Harry Steel hasn’t given an inch.
MF: In an attempt to end the strike the pilots have said that they are willing to go back to work under the old contract. That offer was rejected by the company. We have linked the two sides in this dispute: Harry Steele is president of EPA and Captain Keith Lacey is a captain who has flown for fourteen years and is head of its Pilots Association.
Mr. Steele, the pilots, have said they are willing to go back to work for you, with no increases. Why won’t you take them back?
HS: The issue, Mary Lou, is one of productivity. We must have eighty-five hours a month, and if the pilots want to give us eighty-five hours a month, we’ll take them back.
MF: Captain Lacey, why did you reject that demand from your company?
KL: We didn’t reject that demand from the company. At no time did we reject that demand and I’d say to Mr. Steele right now that if all he wants is eighty-five hours a month over our old contract, I will give it to him right here and now on television. He can have his eighty-five hours over the old contract with no other changes. I will stand by my word and give him his eighty-five hours with no other changes in our old contract. I say that now, and I mean it.
MF: Mr. Steele?
HS: Yes, well the contract is very thick and there’s more than one issue. We need the eighty-five hours, and I can’t say to Captain Lacey we’re going to take out everything else, but that’s the crux of the matter.
MF: Captain Lacey has said you can have it, so what’s keeping you apart?
HS: Yes, but Captain Lacey has said that a few times before but I’ve not seen him offer it. What he’s offering in the latest proposal is something less than eighty-five hours.
KL: I’d like to cut in right there … that’s not right, Mr. Steele, and you know it. I’ve offered you eighty-five hours several times in different forms. You say you want eighty-five hours. That’s not an increase of five hours, it’s an increase of ten hours in some months, and we’ve offered you just now in the latest offer eighty-five hours per month; we offered it to you in a newspaper ad, and we’re offering it to you again. If the old contract wasn’t good enough for you and all you want is eighty-five hours flying per month on the jet with the salary you give us and that’s your figure, … then I ask you ‘you have it.’ Why are we not back to work?
HS: The fact of the matter is that as I understand it, Captain Lacey, you have not offered the eighty-five hours and if you’ve got that to offer you had better go back to your committee and negotiate with them, I’m sure they will give it to you. That is the fundamental issue is eighty-five hours. There may be other considerations.
KL: The fact is that the company is leading everybody to believe … it’s not the major issue. The company is leading everyone, the public included, and the pilots that the only problem here is five more hours of work. You put a very expensive ad in the newspaper, and we answered it: We accept, the issue is now settled. But it’s not settled.
MF: Captain Lacey, what do you think are the other demands that the company won’t talk about?
KL: The company has made a long list of demands. They gave them to us on the fifteenth of October, and we still have them. They have totally ignored any proposals we have put on the table. They have them, and they still have them.
MF: What are the other demands and what are the things you object to?
KL: We object to the company wanting to increase their supervisory pilots to a number that they so designate. They want to increase our landings, and they want to increase our duty period and decrease our rest periods. The whole issue that they want … And they chalk it all up to five more hours of work.
MF: Mr. Steele, it seems as though there is more to this than just the eighty-five hours a month.
HS: Sure there are other things when people work, there’s more to it than salary and hours, and that is the contentious issue is one of productivity. The fact of the matter is that people should be working more than two weeks a month. I think that eighty-five hours … and that’s not “hard time,” that’s “credited time,” so it only works out to about fifty hours a month actually flying.
MF: I’m really confused here now because you say that is the main issue, the crux of the whole thing, and we hear Captain Lacey saying “You can have that.” Yet nothing is happening.
HS: Well, Captain Lacey has offered that before and I —
KL: It was offered before, and it was offered in good faith, and it still is.
HS: You’ve only offered it, Captain Lacey, on radio and television, and your latest proposal as I understand it now … did you offer eighty-five hours in your proposal today?
KL: I most certainly did so.
HS: You did? Well, that’s not my understanding.
KL: The whole thing has gotten a little bit “low” here with different press releases and company releases and pilots being referred to as everything from bus drivers to technicians. We have offered this company … Mr. Steele says that his only problem is productivity and the shareholders and we have our careers here, our lives. We have devoted as much to this airline and have as much invested in it as Mr. Steele does.
MF: If I’m not misreading you, Mr. Lacey, I think you’re saying now, and you’ve said before, that you didn’t think the company really wanted to negotiate. Let me put that to Mr. Steele: Do you want to settle this?
HS: Yes, we do want to settle. We want Captain Lacey and all of his pilots back, and we want them back very badly.
MF: Mr. Steele, if that eighty-five hours a month is on the table, is this over?
HS: Well, if it’s on the table, as far as I’m concerned it’s over because if these other things that he addressed are looked after as well. But the major stumbling block, as I understand it, is the eighty-five hours, and unless we get eighty-five hours for $83,741 a year for the captains, there will be no settlement.
MF: Captain Lacey, is that eighty-five hours a month on the table?
KL: It was interesting just then to hear Mr. Steele say, “If the eighty-five hours is the major stumbling block.” And then he said, “In addition to all the other things.” Mr. Steele knows the eighty-five hours is the major stumbling block because I’ve just given him all the other things. He knew that this afternoon.
MF: Okay, is the eighty-five on the table?
KL: It’s on the table, but it’s not on the table with all the other things, no.
HS: Well, is it there or isn’t it? Is the eighty-five hours on the table?
KL: If that’s the only thing you want….
HS: Is it there?
KL: It’s not there with all the other things you want, no.
HS: Okay, well then I suggest to you that it’s not there.
KL: It most certainly is so there.
MF: Gentlemen, I thank you both for this. It sounds as though you’re not that far apart. I may be inexperienced, but I look forward to this in the next day or two.
HS: Yes, I do too.
The consensus is that Harry Steele lost that battle. Keith Lacey was more at home on television, and it showed, maybe not in the transcript of the interview, but certainly on the screen. That was a battle in a long war which in the end the company won, and the union lost.
Rex Murphy, no stranger to television, worked as a reporter in Newfoundland at the time of the strike. He says Harry Steele is “tough as a nail.” “Harry went through the picket line every single day. The idea that you could physically or morally blackmail him was never going to be,” says Rex. He says Harry had too much to lose to give in. “Everything was hanging by a thread; he had a family, and he had borrowed to get The Albatross and then he ends up with this EPA airline from the Crosbie bankruptcies. Nothing was easy.”
More than a dozen years later, Keith Lacey was interviewed by David Napier about life with Harry. Though the two men were fierce opponents at the time, Lacey was surprisingly laid back.
“I like Steele and enjoyed being around him,” says Captain Keith Lacey, who represented the Canadian Air Line Pilots’ Association (CALPA) during the 1983 strike at EPA. However, Lacey adds that Steele’s “militaristic style” often meant that senior recruits to the East Coast airline “weren’t sure if they were joining the Forces or EPA management.” And below the executive level, unionized employees were worried not only about future changes in an industry that was due to deregulate but about what they perceived as their boss’s anti-union attitude.
Well, maybe Lacey harboured a touch of bitterness.
John French was a pilot with EPA who defied the union and kept flying throughout the strike. He started flying for EPA in Greenland in the early 1960s and then went to work with them on the mainland in 1966. French’s long history with the airline was part of the reason he defied the union and worked during the strike.
French first met Harry a short time after the Steeles bought The Albatross Hotel. “We used to spend a lot of time there when we were on layovers, and I would see him there having breakfast. EPA was very small, and we would see him, or the previous president, Keith Miller, and we were almost on a first-name basis being such a small company.”
John French was involved with the union at Eastern Provincial and at one point was the union local president. But his relationship with the union changed when the strike began. “It was a very difficult time. I wasn’t involved in an executive capacity, but when the strike occurred I think the union went out for about a month, which I supported without any question whatsoever. As they stayed out, it became obvious that Harry couldn’t keep the airline going under that situation, so he told the union that he was going to bring in outside workers to fly the airplanes. There was no doubt in my mind that he was serious and that, if he did it, things were only going to get worse.
“I advised the union leadership that, after a month, it was time to bring the membership back to work before that happened and live to fight another day but, of course, my advice was not taken. The union leadership had very different views of it. So I told them that I disagreed with their position on that issue and that if they continued to insist on keeping the membership out that would be a decision that I could not support and I would have no choice but to resign my membership in the union and go back to work, which is what I did. I want to make it perfectly clear that the decision was made by my wife and me and not with Harry or any of the EPA management whatsoever.
“That strike turned into one of the bitterest strikes in the history of Canadian labour. Friendships were lost; I had best friends there who never spoke to me again. It was very bitter, and there’s nothing good that can be said about it. I want to make it perfectly clear that both sides were to blame for it: Harry and the EPA management were wrong to bring in outside workers, and I think that he grossly underestimated the [resolve of the] union, and I think the union was just as wrong in underestimating him and his management team. It was just a situation where both were at loggerheads, and I guess no compromise was going to be made and it was all very sad.
“There were a number of court cases, and the courts ruled that Harry was justified in bringing the outside workers in, and another court overturned that. It was the end of EPA, and there were certainly no winners, with the possible exception of Harry, who was a winner financially because he ended up selling the airline for a sizeable profit. But there were no real winners; families were torn apart, and it was just a bad scene.”
John stayed in touch with Harry Steele, who always remembered him. “Harry told me after the strike that if there was anything he could ever do for me not to hesitate to ask him. I took him up on that offer, and he kept his word. He was very kind and generous to my late wife, Estelle, and me, and in that regard, I have nothing but good to say about him. I have a winter home in San Juan Puerto Rico and have made some very good friends there and once I invited a couple of my friends up to Canada for the first time and I asked Harry if there was any chance of taking them to his fishing camp and there were no questions asked.”
Eventually, Canadian Airlines bought Eastern Provincial. That deal was building block for expansion and growth. The family reaction was surprising.
“I think there was a great relief in the family. Obviously financially it worked out very well but, for me being very young at that point, it was one of the happiest days of my life because at that time we had gone through a long period of financial uncertainty plus incredibly bitter labour strikes and living in a small town it was tough,” says John Steele.
You might think people at school would have picked on him during the strike, but that was not the case. “Everybody at high school always treated me very well. Later at (Memorial) university you’d have somebody who the odd time might say something to you, but within the town of Gander itself, I have to say that it was not a problem. You had people whose parents were out on strike, but they always treated me very well. I never had anybody give me a hard time in Gander about it.”
The family may not have suffered attacks from their neighbours and peers, but Harry certainly did. There were even troubles with the Newfoundland government. Brian Peckford in particular. Peckford was premier of Newfoundland from 1979 to 1989, which apart from a brief period in 1978, covers the time Harry Steele ran Eastern Provincial Airways and was on the board of CP Air.
Rex Murphy puts it down to a clash of personalities.
“Steele was one of these really independent personalities and some of these strong-arm premiers, and Peckford was in his day, don’t like secondary characters. Steele wasn’t established yet, and this was when everything was fragile. Air Canada was gunning for him too.
Harry ran a tight ship at EPA, but he knew the airline would never be a big money spinner. “You don’t make money running an airline; you make money when you sell it.”
Harry started his venture with EPA in 1978 as a man with a hotel, a middling-sized stock portfolio, and a mortgage on the family home. He ended with a profit of $20-million in 1982 after just four years. That $20-million, the profit went to Newfoundland Capital Corporation, not to Harry personally. It was the seed capital that started Harry Steele and his company on a buying spree over the next decade into even more profitable businesses, first in transportation, then newspapers, and radio.
Harry Steele would never look back.