Wednesday, July 11, 2007

Flaherty moves decisively to compensate victims of theft

In a decisive act of patriotism and compassion, Jim Flaherty recently provided one of his constituents, Robert Stone, with a new Canadian flag to replace the one that had been stolen from his home in Whitby, Ontario. Please note, it was also an act of great frugality, as every MP receives 100 free 3’ by 6” flags to hand out at will. The fact that this act of great generosity made it into the papers was probably the furthest thing from Jim Flaherty’s mind (see below). Just think of it as the unintended consequence of kindness.

Now that we have witnessed this softer and more compassionate side of Jim, perhaps he may wish to revisit the wisdom of an earlier decisive move on his part to tax income trusts. It’s becoming apparent that this blatant act of theft on the part of Canada’s New Government taking the form of the loss of $35 billion in Canadian’s life savings and the loss of an important investment choice to the 70% of Canadians without pensions isn’t perhaps the most frugal or patriotic tax policy that could have been devised. The recently announced sale of BCE has brought this into sharp focus, not to mention the 20 income trusts acquired in the recent few months. These events have two things in common. First, these Canadian businesses are being acquired predominantly by foreign capital. Foreign financial capital for whom there is no underlying business combination or strategic rationale. Second, as a direct consequence of these purchases by these financial players and Flaherty’s elimination of the 15% withholding tax paid by foreigner investors on interest for leverage buyout loans, there will be a dramatic loss of revenues to the government of Canada. In the case of BCE alone, many in the press have reported the loss will be $1 billion in lost taxes per year. We calculate $793 million a year. Taken as whole, this policy has the very likely potential to decrease Ottawa’s tax base by $7.5 billion a year, in perpetuity. But that’s just the revenue side of the equation. Who knows what the impact will be on spending, as many retirees will no longer be able to sustain themselves with the returns associated with other retirement investments, whose yields are generally half the level of income trusts. Call this the hidden underfunded pension liability that you never read about in the paper, since it only affects the 70% of Canadians without pensions and is not something that can be calculated, however it can be observed in the form of materially reduced standard of living for these affected individuals. The compassion voiced by members of the Conservative party on this matter: “get a life” or “it’s not my fault”. And to think one of the false propositions in the Ways and Means motion fraudulently read: “strengthening Canada’s social security system for pensioners and seniors”. Go figure, as Flaherty obviously did not.

Perhaps. Jim Flaherty can learn a lesson from his Whitby constituent, Robert Stone. Nest time you decide to implement an ill thought through tax policy that represents the reversal of an explicit election promise, perhaps it would be wise to run it up the flag pole first, and see how many people salute it.

Meanwhile, good luck ever replacing these businesses lost to foreign capital and the associated loss of taxes. This may end up costing Flaherty where it hurts him most. No more free flags to hand out in acts of false patriotism and compassion. These trivial acts of kindness have been superceded by his innate incompetence and “need for speed” decisiveness. And to think, they called one of Canada’s most accomplished Finance Ministers, Mr. Dithers.

Flaherty to replace stolen flag


There will be a new flag in front of Robert Stone's house.

Although it may not be his father's burial flag, he said it will still fly in remembrance of him and all other veterans.

Last Monday, Robert Stone's mother, Mary, discovered her husband's burial flag had been stolen from the front of their Whitby home. Lieut. Robert Charles Stone died this year at the age of 80.

When Finance Minister Jim Flaherty heard about the theft, he decided to present the family with a new one at their home today.


"I was very, very touched," Stone said.

Flaherty's press secretary, Chisholm Pothier, saw Stone's story and sympathizedy. Pothier said the minister felt bad that somebody could disrespect a veteran's family and his office contacted Stone Wednesday night.

"The minister ... ordered a new flag and will present it to them," Pothier said.

Stone said he's learned a valuable lesson and will raise the new flag every morning and take it down every night.

"We're a quiet people, we don't make a big thing about nationalism," he said. "But when I think about that flag, it wasn't just for my father, it was for every veteran or for anyone who has a relative who died recently for this country.

original story


Kephalos said...

It’s truly fascinating how certain themes and motifs from the great books are continually replayed throughout history, and even modern times. I mean, of course, from Homer, Greek tragedy, Plato, the Bible, Shakespeare and similar. For example, in the Book of Matthew, we see the theme of appearing to a good person.

“Woe to you, finance scribes and hypocrites! For you tithe… and have neglected the weightier matters of the law: justice and mercy and faithfulness. These you ought to have done, without neglecting the others. You blind guides, straining out a gnat and swallowing a camel!

“Woe to you, finance scribes and hypocrites! For you clean the outside of the cup and the plate, but inside they are full of greed and self-indulgence. You blind scribes! First clean the inside of the cup and the plate, that the outside also may be clean.

“Woe to you, finance scribes and hypocrites! For you devour widows' houses and for a pretense you make long prayers…

Dr Michael Popovich said...

Great piece Brent--thank goodness we have yourself & CAITI to stand up for us!!

It is definitely the 70% of Canadians who do not have a public pension plan that will be the most severely affected by the so-called Tax Fairness Plan.

The first shock was the decrease of our overall worth in our investment portfolios--mine has never recovered even to the Oct 31 levels & we are still out the 10% that the markets have increased in general above that same Oct level--the media has bandied about figures to the contrary--not sure what that is all about other than spin created from within.

We have found our buying power substantially reduced from decreased distributions in some cases & from just our overall lack of confidence in the markets & in what ever the government may have up it`s sleeves to shaft us with next--our confidence to buy has been substantially decreased.

Losing the investment choice of trusts with their great returns has been another nasty shock--a one time gain , as a good investment is bought up, does not compensate for the lost steady monthly income--products , like Manulife Income Plus & their paltry returns , do not do it for me--I will invest down south first.

We must all be prepared for the inevitable tax increase or program cancellations that will come about as tax revenues decrease as a result of the present buy outs of trusts & other Canadian coporations--this will happen sooner than we think--Mr Flaherty has a nack for hiding deficits , so be prepared.

i think one of the most crirical cosequences of the TF plan is the lost confidence in our government--it was borderline at best before this occurred--it is non-existent now & has no prospects of improving as long as these guys remain in power.

We must be prpared to do something about that!!!!!!!!


michaelagolf said...

Almost forgot--Flaherty`s cheesy attempt to use someones misery for his own personal benefit deserves no comment--this guy has no scruples whatsoever & needs to be discredited at every turn.

Giving him attention only serves to promote his personal adgenda.

Happy Halloween to us all!!!!!!!!!!


PS--I bet you can`t tell--but I am still a little pissed off!!