Seems like I wrote it a while ago, but The Record published my letter today:
I’d punched it up from my first draft — no more bulleted lists!
Economy
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September 29, 2008
Canadian election week 3. Sigh.
Posted by cultureguru under Arts, Economy, Environment, Politics, TravelLeave a Comment
By the end of the week, I was getting pretty grumpy with all involved.
- The Liberals, for being organized enough to put together a great platform, but not organized enough to sell it.
- The NDP, for being on the wrong side of the carbon tax issue, even though they have a leader who should have credibility and integrity on this issue, above all others.
- The Conservatives, for… well, for a lot of reasons, as you know, but especially for pandering to the worst sides of human nature.
- Far too many of my fellow Canadians, for responding to that appeal.
- And the Greens, for… Actually, I didn’t get annoyed with the Greens. But I’ll also not convinced they’re quite ready for prime time.
So took a little break on the weekend, took in a little of that arts and culture ordinary Canadians don’t care about, traveled green (bus, train, feet), and found a few little positives.
- My local candidates debate, where nobody seemed awful. And yes, I even mean the Conservative guy, who can’t be completely hopeless, since they actually let him talk to the media and all that. (Thanks be I’m not in Harold Albrecht’s riding!)
- Some Facebook vote trading group has been started, in an “anyone but the Conservatives” bid. Say you want to vote NDP but live in a riding where they don’t have a chance, you trade your vote with someone in a more NDP-friendly riding, and you vote their choice for them.
- All of our parties are still better than the Republicans and their leaders. There’s always that.
- And, our media, at least some of it some of the time, providing the analysis and details that politicians won’t discuss.
And on that last point… A few favourites from last week.
On carbon taxes
It doesn’t matter how often proponents pledge to recycle carbon tax money into lower taxes on incomes and companies. It doesn’t matter how many economists argue in favour of pricing carbon through a tax.
The Conservatives have distorted the carbon tax idea and scared people. The economy would be “wrecked,” Prime Minister Stephen Harper says. Funny then that Demark, with a carbon tax for a while now, had higher per capita growth than Canada from 1990 to 2006: 36 to 32 per cent.
What, therefore, remains? Policy incoherence across Canada, and Conservative and NDP plans that won’t get the job done. Mr. Harper has not spoken in the election about his “plan,” except to say he has one. What is it?
So in May, the government published the latest iteration of an incredibly complicated regulatory plan, many of the details of which are still unknown. Normally, Conservatives consider complicated regulations as to be viewed with great suspicion. But their “plan” offers the mother of all regulatory schemes.
The plan contains lots of little programs for conservation and renewables. They’re mostly inoffensive, but they won’t bring many emissions reductions.
The silliest is the public transit tax credit, introduced in the 2006 budget as an emissions reducer. The vast majority of people receiving the credit were already riding public transit. By the government’s own numbers, the credit will lower emissions this year by a risible 30,000 tonnes at a cost of $220-million – a staggeringly high per tonne cost.
Jeffrey Simpson – Full article
That $773 dollar of your taxes per ton, folks. That’s so much better than the $10 a ton the Liberals are proposing! Those fiscal conservatives — they are so smart! I totally see why they vote for the party that is so wise about its spending.
On crime
The party’s obsession with crime-and-punishment policies repugnant to urban voters suggests one of two things: Either it is secretly worried about collapsing support on the Prairies – as if! – or else it actually believes that voters lust for vengeance against children (now known as “denunciation” among politically correct Martians – denunciation for life).
How is it that representatives who hail largely from Canada’s most badly policed, violent cities and towns presume so easily to lecture the leaders of Canada’s best-policed, safest city?
Torontonians both pay significantly more on policing per capita than other Canadians, according to Statistics Canada, and they enjoy significantly safer streets than the residents of virtually every town in the country – outside Quebec, which is both the safest and the most liberal-minded province.
Thus the fruits of being “soft on crime.” Crime rates have dropped an amazing 30 per cent since 1991.
John Barber – Full article
On leadership
Stéphane Dion is an odd case. He keeps yapping about his green plan even as party hotshots tell him the story line has changed, we’re off that stuff. Could he think it isn’t a show – that the planet really is in danger? Would that count as real leadership rather than the acted kind? Poor Stéphane. Could he ever play a leader? Doubtful, although if he got elected somehow, and everyone onstage – journalists, MPs – treated him as a leader, he might start feeling, and acting it. Ah, the magic of theatre.
Why hasn’t Harper the Strong pulled away from the field? Why is the Layton NDP stuck? How has the weak, frail Dion hung in – as if voters are seeking something outside the strong leadership box? Such as – weak leadership. Isn’t that what real democracy would be about? It would disperse leadership among its citizens. In ancient Athens, they chose most leaders by lot, after policies were established in public debate. They made an exception only for leaders chosen in wartime.
So maybe the leadership axiom isn’t so axiomatic. An Ipsos Reid poll this week found 62 per cent of Canadians say they’re most “swayed” by party stances on key issues versus 21 per cent by leaders. Pollster Darrell Bricker was so stunned, and so committed to official theology, that he insulted voters by saying he didn’t know if they meant it or were just trying to give “the right answer.” To gain what, his approval? Maybe someone should poll the pollsters on whether they think Canadian voters have any brains.
– Rick Salutin, Full article
On quality of Conservative candidates
Among Conservatives, there is a lot of grassroots support for Chris Reid’s brand of conservatism. He wants to close the CBC and scrap the Indian Act and seems to have deep-seated rage issues – but Team Harper dumped him anyway. Word is that Stephen Harper draws the line at homosexuals with guns; and really, considering his record on that file, I can’t say I blame him.
As for the pro-drug, pro-prostitution Mr. Warawa, a spokesperson for the Prime Minister’s Office now says that, as of three days ago, he has changed his views and no longer believes anything he ever said on any issue whatsoever.
Rumour is that he has been run through a Conservative re-education camp. A few pistol whips from a flak-jacket-clad Peter McKay (“Who’s the bitch now, Warawa?”) topped off with a chemical lobotomy, and the boy is as good as new, a virtual Bev Oda – happy to be seen and not heard from ever again. He will make one hell of a cabinet minister some day.
By the sounds of it, when it comes to dealing with party dissidents, the Chinese government could learn a thing or two from our sweater-wearing Prime Minister.
– Rick Mercer Full article
September 21, 2008
Canadian federal election: Week 2 recap
Posted by cultureguru under Economy, Food, Politics1 Comment
The Liberals were much more visible this week, taking my advice by taking on Harper on a number of fronts, including childcare. The Liberal team was emphasized, which seemed wise. Dion explained the Green Shift on the Current (podcast here), and was, to my mind, clear and convincing.
The NDP and the Conservatives, meanwhile, were busily injecting a rare note of humour into the campaign. The NDP experienced the resignation of not one but two, toke-smokin’, car-drivin’, former members of the Marijuana Party as candidates for the party in BC, because they apparently didn’t bother to YouTube them before offering them the nomination. And the Conservatives, of course, had the whole “death by a thousand cold cuts” kerfuffle. Am I a bad person because that made me chuckle?
Anyway, this inspired the fourth apology by Harper since the campaign began (emphasizing why he’s so reluctant to let his candidates speak to the media), but the first that seemed to stick. And stick. Please, enough with the calls for his resignation, already! Lack of regulation might be a serious issue here. A dark sense of humour is not.
The US economy provided some excitement, with huge companies collapsing and stocks going on a roller-coaster ride in the wake of the sub-prime mortgage crisis. It ended only when the Bush government reversed its laissez-faire policies and stepped in with massive investment. (Fun fact: $1 trillion could buy you 5 billion iPhones. Or 1 war in Iraq.)
Canada never allowed sub-prime mortgages, and so isn’t at risk of this exact same crisis. But there’s a more general lesson here about what happens when governments aren’t involved enough, when companies (banks, meat) that need regulation don’t get it, when governments are downsized to the point of ineffectuality.
[Harper's] inability to think in a positive, passionate way about large political projects shows starkly at this tense economic moment. In policy, he prefers to act small. His favourite word is modest. “Our plan is simple, modest and practical,” he said about a tax break for home buyers. As if he’d rather do nothing but, in a pinch, will settle for the least possible. His modest GST cuts give little relief, but they whittle government revenues down so he can claim we can’t afford much anyway. This week, he announced a ban on tobacco ads, which are already banned, and sales to kids, ditto. I know this “modesty” reflects Stephen Harper’s political philosophy and he could rattle on passionately about why government should do the least it can, for the good of us all. It’s the reason he wants a majority: so he can do even less and eliminate more. But he may be the wrong leader at the wrong time.
September 20, 2008
Reason of the day to not vote Conservative: Ontario bashing
Posted by cultureguru under Economy, Politics, Uncategorized[2] Comments
Dalton McGuinty’s been fighting for a more equitable share of federal resources for a long time now—did you know there’s a whole, official Ontario government website on this topic? I didn’t, until today, but it is informative. For example, while I already knew that Ontarians got considerably less per-person health care funding than other Canadians, I didn’t realize that Ontarians have to work longer to qualify for EI, and are eligible for fewer weeks of payout.
So twisted is the equalization formula, in fact, that even even if Ontario were to become a poor, “have-not” province, its residents would continue to be net contributors to the system. In other words, if Ontario’s economy were to tank to the extent that it qualified for equalization payments, that additional money would actually come in part from — Ontario.
So no wonder some argue that the system makes Ontario the “patsy” of confederation.
Now, much as I’d like to, I can’t really blame all of this on the Conservatives. They didn’t write all these rules, it is a long-standing problem, and I’ll accept that these things are complicated and expensive and can’t necessarily all be fixed in two years.
I’m just not so sure, given their track record, that they’d start fixing them in the next four years, either.
You will recall Flaherty helpfully saying that Ontario is the “last place” that businesses would want to invest, as though he were any kind of example to follow in tax policy.
And you might not recall this, but they’re also trying to pass Bill C-22, which tries give Ontario less representation in Ottawa. The proposal gives BC and Alberta 1 new federal seat for every 100,000 increase in population, while Ontario gets half that — one new seat per 200,000 increase. Hmm. Couldn’t be because the westerners are more inclined to vote Conservative, is it? No, it just means that McGuinty is a “small man of Confederation”, according to Conservative House Leader Peter Van Loan.
September 19, 2008
Reason of the day to not vote Conservative: Income trusts?
Posted by cultureguru under Economy, PoliticsLeave a Comment
You know, I wasn’t going to do this one.
Yes, it was a broken promise. The Conservatives promised not to tax income trusts, and then they did it anyway, basically rendering them extinct by 2011.
But see, I’m not against politicians second-guessing themselves once out of the election heat, really researching the issue, getting advice from experts. And if they determine that their promise really isn’t in the country’s best interest — that it could actually be harmful — then I’m all for them breaking it.
And I actually thought this was one of those cases.
An article by the quite conservative Al Coates, in the KW Record, of all places, had caused me to reconsider this.
The rational for banning income trusts — the reason I thought it might have been wise — was to avoid two problems:
- Tax leakage, because the trusts pay no corporate tax — all profit go directly to investors.
- The “hollowing-out” of corporate Canada — great Canadians corporations being converted into trusts.
But as with so many of the Conservative actions, the decision was a complete surprise to the investors and companies involved. Investors were hurt financially (famously, a lot of seniors), and companies counting on funding from them were left vulnerable.
And Coates argues that the widespread, unintended effect of the decision was this:
Many of those trusts have become takeover targets by giant private-equity players. They are being taken off the map and the radar, folded internally into big pension plans, never again to be seen as income-producing opportunities for Canadians.
He gives the example of BCE, one I’m very familiar with, having relatives living through the nightmare of BCE’s takeover by the Teacher’s Pension Plan.
The buyout will be financed through borrowing and BCE will be taken private, dismantled, chopped into pieces and perhaps sold off in parts. Already, thousands of BCE mid-level jobs have been whacked and there will be more to come. [It's so true!]
BCE is a cash-flow machine and its free cash will be used to finance the debt. The new owners of BCE — teachers and its American partners — will pay no corporate tax because, in the first place, pension plans don’t pay tax, and for the other buyout partners, there also are offsetting cash-flow and debt-service factors at work. Ottawa will be lucky to see a wooden nickel in ongoing corporate tax proceeds.
I’m so far from an expert in this stuff, it’s not funny. But it sounds like, just maybe, this is not a case of “tough but necessary” decision-making, based on sober second thought and analysis; it could be yet another hasty and myopic decision that will only weaken Canada’s economy in the long run.
And that’s a lot worse than just a broken promise.
September 18, 2008
Reason of the day to not vote Conservative: The GST tax cut
Posted by cultureguru under Economy, Politics[2] Comments
An easy one for today: Cutting the GST, a policy so bad it actually united right and left in opposition to it.
I think Jeffrey Simpson’s “A triumph of politics over economics” summarizes the issue best:
Personal and corporate income tax cuts, as every economist knows, tend to stimulate savings and investment, which is what an economy needs to become more productive and competitive, thereby raising overall living standards. Lower consumption taxes stimulate more – wait for it – consumption, some of which leaks out of the economy in the form of purchasing imports and taking trips abroad.
The GST cut is the triumph of base politics over sensible economics.
Thus far, the Harper government’s tax and spending policies have been deeply disappointing for the country’s competitive position.
The government will have drilled a $10-billion hole in federal revenues through the two-point GST cut that will do nothing for productivity and competitiveness when compared with every other available tax cut, as the economists interviewed by the ROB illustrated this week.
Both policies represented the triumph of politics over economics, and short-term political considerations over long-term economic thinking.
Instead of this nonsense, tax policy should involve raising the GST, introducing carbon taxes, and then offsetting these new revenues by reductions in personal and corporate taxes to make Canada more efficient, competitive, fair and green.
(And as an aside, CBC’s Marketplace did an interesting story this year where they showed that, in many cases, the GST was just swallowed by rounding, giving more money to the seller and less to the consumer. Examples included movie and theatre tickets, whose “price includes GST” didn’t check a whit as the GST rate did. The companies just made more profit on each ticket.)
Sigh. So more’s the pity that we pretty much stuck with this 5% rate now. Though both the Liberals and the NDP argued against the cut, neither will take the political risk of undoing it (despite Conservative ads claiming the contrary). Only the Greens, bless them, are willing to to pledge to raise the GST back to 6% and use the increase to fund mass transit in cities.
