“Limited evidence suggests”. That was the not so famous enjoinder that accompanied everything that Bank of Canada Governor Dodgy David ever knew or said about income trusts. Not knowing seems to be a realm that Dodgy David prefers to occupy as he resisted at every opportunity to discuss with me the findings of the exhaustive study that was performed by PricewaterhouseCoopers in December 2006 about the impact of income trusts on the economy. Much like the concept of entropy, which argues that nature has an inherent tendency to devolve into the state of maximum randomness, David Dodge actually seeks out the state of least knowledge. Sort of like living your life as a series of interest rate forecasts.
Now we are entering a new realm at the Bank of Canada. Gone will be the days of “limited evidence suggests” as we now enter the world of Mark Carney’s “no evidence suggests”. This realm could just as easily be called the ‘fabricated evidence suggests” since it was Mark Carney and Mark Carney alone who thought it was okay to leave out the 38% of taxes collected by the government from income trust distributions, in his fraudulent and highly intellectually corrupt scheme to rip off 2.5 million Canadians from $35 billion of their life savings, for a whole host of reasons, none of them good. No evidence took the form of 18 pages of blacked out documents that constituted Mark’s idea of accountability and transparency. Central Polit Bureau style.
Speaking of Russia, Mark Carney honed this skill of ripping off large numbers of people from their rightful financial entitlements when he worked in the Moscow office of Goldman Sachs assisting a handful of today’s billionaire Russian oligarchs to rip off Russian citizens of their state’s assets in a process known as privatization. Having served his time in Moscow, Mark then made his way back to Canada to work for Goldman in Toronto to assist Canadian and US clients in cross border M&A and financing activity. It was quite unfortunate for Mark that he arrived at a time when it seemed that every other financing being done was an income trust new issue underwriting that required the services of no US dealer , since it was Canadians buying Canadian through Canadians. This must have been a terrible event in Mark’s young life and he obviously vowed to do something about it. He then trecked off to Ottawa to work for 10 cents on the dollar and execute his grand plan to reassert Goldman Sach’s dominion over Canadian investors and issuers. If not, why would he have been the person behind eliminating the 15% withholding tax on leveraged buyout loans, or the interest deductibility on foreign acquisition debt or the 10% withholding tax on bank loans. It certainly wasn’t to improve Canada’s lot in life.
Mark’s magnum opus however was the Tax Fairness Plan that was designed to raid seniors’ nest eggs. The rest is history. Welcome to the era of no evidence suggests. I’m sure Mark has more work to do in the days ahead under his 7 year mandate. Are BoC Governors subject to Parliamentary reviews as Fed Chairmen are in the US? Can lowly citizens participate? Seven years is along time. Look what Mark has accomplished in less that half that time.
Before I go I would like to offer Canadians an alternative era to live under. That era would be known perhaps as the “subsequent events are irrefutable” era. Here’s a summary of the havoc wrecked to date on Canadians by Mark’s handiwork. Almost makes you feel like its Moscow in the spring. Or Abu Dhabi in the fall. Either way, entropy will soon have its way on Canadians meagre lives if something isn’t done to halt this out of control train wreck in progress.
Income Trust Takeover activity to date, excluding BCE for $32 billion
The income trust takeovers below are categorized into “It’s not my fault” domestic pension fund takeovers, and “it’s not my fault” foreign private equity takeovers. The results are however the same. Tax leakage and the crowding out of the 70% of Canadians without pensions in favour of those civil servants, MPs , Senators and others with pensions and those who reside in foreign tax jurisdictions, like BCE”s new owner Madison Dearborn’s Madison Dearborn Capital Partners IV, L.P incorporated in Luxembourg (or the like).
$22.51 Billion in takeovers so far.
And $9.78 Billion in deals pending.
Thursday, October 4, 2007
Posted by Fillibluster at 6:37 PM