They call it 'throwing in the towel'.
On Friday, the biggest boosters of the Canadian Museum for Human Rights threw in the towel.
Like a punch-drunk fighter, the CMHR is still swinging, refusing to give up. But the Winnipeg Free Press, the propaganda arm of the museum, admitted in an editorial that the cost overruns of the CMHR are beyond the ability of the private sector to pay. The charade is over.
The numbers are so grim that the FP refuses to publish them.
So we'll do it for them.
Before the public meeting held by the CMHR in early December, they claimed they were within $20 million of their budget. Two weeks after the meeting, they confessed that costs had actually risen another $41 million---for construction alone.
Subtotal: $ 61 Million
The CMHR said they weren't counting the costs of a 350-seat theatre and of a temporary gallery, that was going to be used for travelling exhibits and for non-permanent shows on a theme, event or issue. They ran out of money before these could be tendered, so they don't even know how much they would cost, although both are an integral part of the project.
You can add $2 million to the subtotal.
As reported in The Black Rod, the Friends of the Canadian Museum for Human Rights reduced the amount of money they turned over for construction in 2010 by $2 million so they could use the money for future fundraising. But they didn't subtract it from the total they claimed they raised.
The 2010-2011 annual report from the CMHR says that as of March 31, 2011 they had spent $143.3 million on building the museum.
And they had $83.3 million in cash and investments on hand waiting to be spent.
But that only adds up to $226.6 million.
At that point, they were claiming publicly they had raised $285 million.
Where was the rest?
Ten million dollars was the final payment from the federal government, to be paid out this year, but the other $49 million had to be the IOU's collected by the private fundraising group, Friends of the Museum. Twenty million of that was paid out in 2011, according to a later financial statement from the CMHR, leaving $29 million outstanding. Add that ...
and you've got ...
a total of $92 million
plus the cost of untendered work, that the private sector has to either raise or collect in one year to finish the project.
Not. A. Hope. In. Hell.
And that would only pay for the building. The original budget set the price of exhibits---four years ago---at $35 million. Has that doubled since?
Can the private sector raise $127 million to $162 million to finish the museum in two years?
Not on this planet.
The Winnipeg Free Press conceded as much, but what they did next - was breathtaking.
The newspaper then dove headlong into an astonishing, headspinning exercise of rewriting history straight out of George Orwell's Ministry of Truth.
The Free Press story writes millionaire Gail Asper, and even her father, billionaire Izzy Asper, out of the history of the CMHR and inserts in their place Prime Minister Stephen Harper.
By the 'new truth', the Canadian Museum for Human Rights is Stephen Harper's project, not the Asper family's. (Honest. We're not making this up. You can't make this stuff up.) In fact, the headline on the editorial is "Mr. Harper must finish his project."
By the new reasoning, Stephen Harper "assumed complete control of the project" in 2007 when he seized it from "those who had earlier been struggling to get the project off the ground." and made it into a national museum.
He installed his own board of directors, the Free Press said, and Harper appointed his own CEO, Stu Murray,without consultation. (Uh, oh. It sure smells like somebody's getting set up for a trip under the bus.)
"Ottawa was in charge," trumpeted the editorial.
Gail Asper, the hero of the Free Press version of truth, came to the rescue of the federal government, not vice versa, by committing the private fundraising group Friends of the Canadian Museum for Human Rights, to raise $105 million of the $265 million budget.
"Last April, the Friends met their target and fulfilled their promise." the newspaper declared triumphantly. And when the budget rose to $310 million, the "fundraiser agreed to make up the difference" bless their souls. "Today," sniffed the editorial,
"they are about $20 million short of that goal, an enormous achievement."
But the museum staff "says it needs $41 million more before it can open." ( Note how subtly they've started creating distance between museum staff and the Asper-led Friends.) The cost overruns "were to be expected", says the newspaper, which interestingly never once in three years of construction predicted that there would be more than $80 million in overruns.
"The fact is it is Mr. Harper's responsibility to finish the museum by providing the last $41 million. It's Canada's museum and his reputation that are at risk, not the Asper family's."
That's as much hysterical historical revisionism as we can stand.
Every single word in Friday's editorial was refuted in Saturday's War-And-Peace length feature story by columnist Dan Lett on the history of how the museum came to be.
He obviously didn't get the memo.
His story lays it out---how billionaire Izzy Asper wanted to memorialize the Holocaust with a museum here in Winnipeg, how he rooked the federal government into pledging $100 million for his pet project, how the Aspers hired an architect, selected the design and signed contracts before the federal government accepted the CMHR as a national museum.
* Lett forgot to mention how museum backers lied to the Senate to get that official museum status by declaring the budget of $265 million was accurate and backed by a healthy 15 percent contingency provision, and that in any event the private sector fundraisers would cover all cost overruns.
* He also forgot to mention that Gail Asper sits on the museum's board of trustees, heads the private fundraising effort, and has fought vociferously to limit the government's say on anything the museum does.
* And the fact that in 3 years she's made repeated public statements that its the private sector's responsibility to cover the increased costs of construction, not the government's.
That's Lett's share of historical revisionism.
Why would the newspaper even try to rewrite the truth in such a fashion?
At the time of the public meeting, when the museum reps studiously kept the latest cost overruns a secret, the chairman of the board of museum trustees was Arni Thorsteinson, a once-upon-a-time honoured and respected local businessman. As soon as the meeting was over and the first hints of trouble were reported, Thorsteinson bolted for the Exit.
He was long gone before the hopelessness of the CMHR's financial situation was revealed and nobody has been able to get a single word from him since.
His replacement came from within---Eric Hughes, who the Winnipeg Free Press described as a Calgary oil executive, who had been serving as vice-chairman.
They've been friends since their university days. In fact, Hughes played a big role in convincing Harper to get into politics. He handled the finances of the Canadian Alliance. He's a total Harper insider.
Today the FP said there is talk of a $45 million bridge loan from the government to the museum.
A bridge loan to nowhere. A loan implies it will be repaid. There's absolutely no hope the museum backers can repay anything.
- Remember, Stu Murray was hired as CEO in large part because of his, ahem, expertise in fundraising.
- In April, the Friends of the CMHR announced the appointment of Davorka Cvitkovic as their first-ever CEO. "Dav Cvitkovic is recognized as one of the most accomplished fundraising professionals in Canada...," said John Stefaniuk, president of the Friends of the CMHR's board of directors.
- Gail Asper was the national chairman of the Friends' fundraising campaign. "Gail Asper is Canada’s best fundraiser,” said Gail Dexter Lord, co-president of Lord Cultural Resources.
After all these experts got to work, the CMHR is further in debt today than it was three years ago.
And you're going to lend money to them?
The museum lists as major contributors a dozen banks and credit unions. Why don't these financial institutions come to their rescue and loan them $45 million? The Aspers and their fellow millionaires could put their homes and summer homes and vacation homes up as collateral to backstop the loan.
Surely there's no risk the loan won't be paid back, is there?
The Harper government has much more at risk by becoming the lender of last resort than seeing a friend's nose out of joint.
If the Harper government rushes, or tiptoes or crawls, to the aid of the CMHR it will prove to all of Canada that it is a racist government.
The federal government tries to demonstrate its fiscal responsibility by criticizing aboriginal band councils for mismanaging their budgets and reacts to extreme cases by taking control of the finances through a third party manager.
But when a white organization like the CMHR demonstrates it is completely out of control of its finances, the Harper government turns a blind eye except for looking how to give them even more money to mismanage.
Why is this government treating aboriginals differently from whites? That is racism. Plain and simple.
Unless the Harper government takes control of the finances away from the CMHR, dismisses all the board of trustees, and orders a full and public investigation of how the money was spent, all the lies that were told, and who knew what and when, it deserves to be labelled as a racist, anti-aboriginal government throughout Canada.
This isn't a case of doing a favour for a pal.
If this government has principles, it must apply those principles equally regardless of race or political influence.
The cost of the CMHR has gone from $265 million to $351 million, plus untendered work, plus the cost of exhibits, plus plus plus, without any approval from the public.
At least aboriginal governments are elected.
The Harper government must stop the construction of the museum immediately until it knows for certain how much more money is needed. It must insist that the $310 million budget cannot be exceeded. The project must be finished as best it can within that $310 million, and what cannot be paid for will not be built.
That is the message that must be sent to the entire country---stay within your budgets or else pay the consequences.
What then? Then the grandiose plans of the Aspers must be thrown on the trash heap of arrogance.
The best idea we've heard yet is that the Winnipeg Convention Centre could move into the building to share space with the revamped "ideas" museum.
This would save the city hundreds of millions of dollars and recoup some of the monstrous loss we face with the current money pit.
The Harper government must act or pay the political price.