....in defense of his income trust betrayal/blunder
Below are some totally false statements being made by Jim Flaherty in an interview that appears in the September 25, 2008 edition of Whitby This Week, together with my rebuttal in [brackets].
On income trust tax: “If we were wimps, if we weren’t watching out for the best economic interests of our country, we would have done nothing. That’s the easy course, but this was important to do.”
Q: Is there anything you want voters to know about the issue of income trust tax, especially with your Liberal opponent so openly targeting the issue?
A: The fees on income trusts were in the last year that they were vibrant was about $5 billion [both false and irrelevant]-- not million, billion [again false since the average annual fees earned by Canadian underwriters was $400 million per year—million—not billion] and a lot of these brokers [I was never a broker, unless of course you consider that Mark Carney was also a “broker”, since it was Mark Carney whose “US centric broker” advice was followed by Jim Flaherty to bring down a retail investment vehicle that was a threat to Goldman Sachs and its clients as a strictly non-retail firm] made a tonne of money taking good Canadian companies and converting them via and initial public offering to an income trust which created no net gain for the companies [completely false, otherwise why would they do it?] but made a lot of fees for people [that were taxed by the Government of Canada at 50%]....it is a concern but I won’t shirk the issue [how very narrow minded of you, but you sure have shirked you responsibility when it comes to providing any proof of your central policy rationale. What became of accountability and transparency, Mr. Flaherty?].
Our government [don’t you mean your party?], when we were running for office, indicated [promised far and wide and put in writing] that we would not do what we did with income trusts [but you did it anyway]. It’s probably the hardest thing I’ve done as Finance Minister [hard? For whom. You? because you were way over your head, or the people whose retirements you destroyed and people who were forced to sell their homes to make ends meet, not to mention all Canadian taxpayers who have lost billions in, tax revenue, or the 2500 people fired at BCE?] and that was going to the prime minister in the summer of of 2006 [I guess that means you approached Stephen Harper after he had been lobbied by many a CEO in June 2006 in a five hour plane trip to Mexico according the the Globe and Mail, who wanted to eliminate an investment vehicle that was competing with their investment wares?] and saying to him “The facts have changed [how do facts change?, unless you instructed Mark Carney to leave out 38% of the taxes paid by income trusts to create a false argument that would give you faux justification for your actions on behalf of Canada’s corporate elite and lifecos?] and we need to look at the issue again [and yet you did not even entertain the idea of consulting with stakeholders the way that Ralph Goodale did?]. I’m recommending that we level the playing field [as measured by what? Putting a 31.5% tax on one team while the other team only pays a 6.2% tax? That’s not level,. That’s a policy falsehood, and you know it. Your goal from the outset was clear, Your policy was simply designed to kill the competition on behalf of the life insurance industry so they could go back to selling life annuities and other questionable products, free from any competition.]
If we were wimps [so why did you drop out of the CTV Virtual Town Hall meeting at Iroquois Park for October 1, 2008 if you aren’t a “wimp” and too afraid to debate the other candidate live on TV?], if we weren’t watching out for the best economic interests of our country, we would have done nothing [like you solemnly promised far and wide?]. That’s the easy course, but this was important to do.” [ important for whom and for what end purpose, to have Canadian companies acquired by middle eastern oil companies and Hong Kong billionaires? So 2500 people could be fired by BCE? So that $2 billion in tax revenue could be lost? So more takeovers amounting to $200 billion (not million) could occur? So that you could demonstrate your utter ineptitude and deceit?]
Income trust were being created for the wrong reasons [according to whom? The government?] they were being created because there was a tax loophole [income trusts are tax flow though entities. If tax flow through entities are a loophole then why is your law firm allowed to retain this tax loophole.Why can pension funds invest in so called tax loopholes, but RRSPs can not. RRSPs were intended to be the average Canadians ‘way of achieving parity with pension funds. You have destroyed that parity. Is that because you were too much of a wimp to take on Teachers’ the way that Ralph Goodale did?] and not because it was the best thing to do for business [wrong again. How is accessing a lower cost of capital not a wise thing for business to do? Especially when is has zero effect on government tax revenues? Is Jim Flaherty opposed to win-wins or is he simply in the pocket of Canada’s corporate elite and purveyors of competing products? Is that why Investor Group representative are knocking door to door in Whitby-Oshawa during this election touting Jim Flaherty’s policies with government literature?].
And now we will have by 2011 everyone [except pension plans, foreign private equity, law firms, accounting firms, REITs, mutual funds etc etc] playing by the same rules so a business that’s in a corporate form or in an income trust will pay the same level of tax in Canada [ totally false and unproven by Flaherty, since that was the way things were before Flaherty made his policy blunder, namely tax neutral to Ottawa. Meanwhile, under Flaherty, what level of tax will be paid by private income trusts versus public income trusts? Zero versus 31.5% doesn’t sound very level playing field to me?].
There’s a lot of reasons why we did what we did. [but I ain’t going to reveal the real reasons. For that you will have to speak with Brent Fullard, someone who speaks the truth and actually understands the complexities of finance and the motives of Corporate Canada and the needs of Canadians].
Sunday, September 28, 2008
Posted by Fillibluster at 9:19 AM