March 2000 Contents

Contents Devco: What Price Loyalty? This case study of the last generation of Cape Breton coal miners who held out for a better deal when their jobs disappeared is the starting point for examining issues such as the one-industry municipality in Canada, the interdependence of employer and employee, the commitment and loyalty to the workplace, and the rewards or lack of them in these crucial symbiotic labour relationships. The Devco situation is one that also defines hundreds of Canadian towns. Introduction The Dilemma of the One-Resource Economy Human Costs Solidarity The High Cost of Coal Above and Below Life After Coal Style and Substance Discussion, Research, and Essay Questions Comprehensive News in Review Study Modules Using both the print and non-print material from various issues of News in Review, teachers and students can create comprehensive, thematic modules that are excellent for research purposes, independent assignments, and small group study. We recommend the stories indicated below for the universal issues they represent and for the archival and historic material they contain. Hard Times, Disappearing Jobs, February 1992 Beleaguered Newfoundland, April 1992 The GM Strike: Driving in New Directions, December 1996 The Arrow: A Myth Made in Canada, March 1997 Eatons: Canadas Store? May 1997 Down on the Farm: Crisis in Agriculture, February 1999 Overworked and Underpaid: Nurses Strike Back, September 1999 The End of Eatons: Retail Evolution, October 1999 Other Related Videos Available from CBC Non-Broadcast Sales Does Your Resource Collection Include These CBC Videos? Theres Gold in Them Thar Hills Winds of Change After the Goldrush Bright and Shining Visions Blood on the Coal Introduction Devco: What Price Loyalty? For almost 300 years, coal mining was the largest source of income on Cape Breton Island. As Canada developed, and the demand for Cape Breton coal grew, one-company towns sprang up across the island to provide a steady supply of workers to go down into the mines. But as the years went by oil replaced coal as the number-one energy source, and the need for Cape Bretons coal began to decline. Ottawa took over the coal mines of Cape Breton from their British owner in 1967 and created a Crown Corporation called the Cape Breton Development Corporation (Devco). Since that time, the government spent billions of dollars to keep the coal mines operational. In January 1999, however, all that ended when the government announced that the mines would close, putting about 1100 people out of work. The Phalen mine in New Waterford would close at the end of 2000, and the Prince mine in Point Aconi would be sold if the government could find a buyer. But when the roof kept collapsing on the Phalen mine it was decided that it would have to be closed ahead of schedule, and it was, in December 1999. The closure of its principal industry was a devastating blow for Cape Breton. The immediate impact is the loss of jobs and the obvious effect this will have on individuals and families; some say it means the loss of a way of life. The number of people out of work in the region will increase, adding substantially to an unemployment rate that is already above 20 per cent, one of the highest in the country. This in turn affects secondary industries, compounding the crisis by further reducing the economic viability of this community, as people in the community buy fewer and fewer consumer goods and services. They have less money for groceries and postpone or cancel needed home and car repairs. And when people stop spending, especially within the local economy, even those not directly employed in the principal industries also suffer. Local businesses that require an employed workforce living in their communities to provide cash flow lose that revenue. And unfortunately, as is often the case when an economic downturn occurs in a particular region of a nation, the lack of jobs and opportunities can create economic refugees. People are often forced to leave their communities and migrate to more prosperous regions of the country to try to find employment. Families can be separated, leading to additional emotional and societal stress. At the heart of this current situation in Cape Breton is Devco, one of the largest employers in what has become primarily a one- industry community. In a cruel twist of fate, of the 1100 people who will lose their jobs when Devco closes its doors, only 364 are eligible for a pension. Although many of the other miners have worked for the company for decades, most are too young to qualify for early retirement, and yet their prospects for employment with another major industry are scanthence the bitter predicament of a regional economy based on a single declining industry. However, the miners of Cape Breton have paid their dues through years of hard labour, mining coal that fuelled the economy elsewhere. Faced with what they saw as a totally inadequate response on the part of the federal government and a disregard for their years of work, the miners took action in the most direct and symbolic way they could; they began an illegal strike in January 2000. In an ironic gesture of resistance and protest, miners stayed down in the mines and refused to come up. Their action had the desired effect of drawing national media attention to Devcos closure, the governments response, and the plight of the people. The Devco situation, however, is not an isolated event; it raises a number of universal questions. To what extent do employers, government, or society in general, owe a duty of service to workers? Is the avoidance of layoffs at all costs or the providing of a reasonable severance to workers when closure of an industry is inevitable the obligation of large employers like Devco, whether private or public? What is the appropriate response to a miner like Jim Noble who said, Were like the dory behind the boat and someones cut the rope and were just set adrift and we dont know where to go. Contents Introduction The Dilemma of the One-Resource Economy Human Costs Solidarity The High Cost of Coal Above and Below Life After Coal Style and Substance Discussion, Research, and Essay Questions Comprehensive News in Review Study Modules Using both the print and non-print material from various issues of News in Review, teachers and students can create comprehensive, thematic modules that are excellent for research purposes, independent assignments, and small group study. We recommend the stories indicated below for the universal issues they represent and for the archival and historic material they contain. Hard Times, Disappearing Jobs, February 1992 Beleaguered Newfoundland, April 1992 The GM Strike: Driving in New Directions, December 1996 The Arrow: A Myth Made in Canada, March 1997 Eatons: Canadas Store? May 1997 Down on the Farm: Crisis in Agriculture, February 1999 Overworked and Underpaid: Nurses Strike Back, September 1999 The End of Eatons: Retail Evolution, October 1999 Other Related Videos Available from CBC Non-Broadcast Sales Does Your Resource Collection Include These CBC Videos? Theres Gold in Them Thar Hills Winds of Change After the Goldrush Bright and Shining Visions Blood on the Coal The Dilemma of the One-Resource Economy Devco: What Price Loyalty? One-company towns based on a single industry emerged across resource-rich Canada during the colonial period, and their development peaked just before the end of the 1800s. These towns were closed communities where the land, homes, stores, and even the churches were owned by the towns major industrial employer. In fact, many of these towns were established to ensure a constant reserve of workers for the industrial employers. By establishing completely functional communities, big industrial employers were able to attract employees and their families to a particular area and then keep them there. For many, one-company towns were islands of stability in a chaotic labour market. But often, employers in one-company towns became authoritarian and placed great demands and restrictions on its workers. For example, in 1909, during a strike by members of the United Mine Workers of Cape Breton, miners were thrown out of their homes and locked out of the company stores by their employer. Members of the clergy who sheltered homeless miners in their churches were ordered by the company to stop. These labour wars signalled the growth of a working-class awareness reflected in the political and cultural life of the region. Despite the fact that Cape Breton once had a relatively diversified economy based on coal, steel, and fishing, the steel mills have declined because the surrounding coal mines became less productive and because of competition with steel mills in central Canada. With the troubles in the fishing industry, a declining population in general, and the inextricable link to coal mining, expansion has been difficult and the economy has been restricted primarily to a single-resource industry. Despite this adversity, Cape Breton struggles to find economic alternatives. On the other hand, single industries once established have also created economic prosperity in what were once isolated regions of the country. This, in combination with other fortuitous factors such as geographic location, in turn led to the development of an infrastructure that allowed the growth of other industrieswhere it is important to remember other viable resources were readily available. A good example of this is Sudbury, Ontario, which, despite a boom-and-bust effect, grew from a primary lumbering town to an international mining centre. Initially it was a CPR company town with the good fortune to be located strategically on the transcontinental railway. Its mining resources (primarily nickel but also lead, zinc, silver, gold, cobalt, platinum, selenium, and tellurium) over the years have provided a broad base for economic diversity and have allowed major single employers like Inco and Falconbridge nickel mines to maintain ongoing operations and to even develop innovative mining technology.

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