Obama scores victory against insurance industry, while Canadian politicians remain captive to it

Obama’s health care reform victory on behalf of the American people is a victory against the insurance industry and the insurance industry’s massive lobbying campaign and campaign of misinformation and often outright falsehoods. It’s a shame that Canadian politicians don’t have anywhere near the same value system. Moral fortitude and leadership capabilities as Barack Obama, as the same insurance industry has a stranglehold on policy making in this country, except the battleground is not health care, but something of almost equal social importance and certainly something as equally commercially lucrative for those who can bend the rules in their favour, namely managing the retirement savings of Canadians.

Bending of rules in one’s favour is exactly what Stephen Harper’s and Jim Flaherty’s income trust policy was all about, and resorting to outright lies and fabrication was Harper and Flaherty’s means to that end. The media was only too happy to oblige these politicians in this task of ripping off Canadians, by repeating those lies at every possible opportunity. The CBC included. Journalists like Diane Francis and Greg Hebert and politicians like Paul Szabo were the rare and noble exceptions to that pathetic rule

Bending of rules in ones favour is what was going on rather than the feel good argument of “leveling the playing field”. The clear intent of the income trust policy was to destroy and eliminate the competition in order that the less robust and more inferior team would be the only team left on the field. Even if the filed were level, what kind of competition and choice is created when there is but one team on the field?

Income trusts were the greatest capital markets innovation that had ever come from Canada and was the market’s innovative solution to a vast number of problems that exist today, including:

(1) providing a means for retirement income in a protracted low interest rate environment, via an investment vehicle that avoided “reinvestment risk”, since it had no fixed maturity date, a form of inflation protection, as it was tied to the earnings of a business, and growth potential, again because it was tied to business

(2) improved governance measures that favoured the true owners of a business over the managers of a business

(3) improved disciplines imposed on business managers that rewards real economic gains, rather than often illusory ones

(4) a form of low cost of capital that placed Canadian enterprise at a competitive advantage and with an abundance of domestic and foreign capital available to it

(5) maximizing the tax collection of Canadians business earnings by taxing the investors rather than the business itself, providing the perfect world outcome of eliminating taxes at the business level, without forsaking the tax collection thereof

(6) allowing stand alone business of all sizes to thrive and achieve value maximization, thereby leaving them less vulnerable to foreign takeover or consolidation under the conglomerate mindset of the corporate model, allowing for more and varied public companies rather than fewer, more conglomerate type businesses, meaning less risk to the economy, and greater employment.

Instead Canada is a country that is governed by politicians who are either completely oblivious to how they are being so openly gamed by the insurance industry or are happy to play along with the wishes and whims of the big boys who pull their strings. as Canadians get their life savings destroyed and their choices eliminated in order to make them captive to the inferior synthetic and derivative investments wares of the insurance industry. Inferior products like Manulife’s Income Plus and variable rate annuity products that Manulife’s management was so reckless and/or incompetent, that they thought they could issue billion of dollars in promises to investors on a wish and a prayer and do nothing whatsoever to hedge the risks imbedded in those promises.

The events of the last 18 months and the global financial meltdown underscored and made vivid to even the blind what was wrong with the income trust policy from the outset and the risks it represented to all Canadian on so many fronts. The fact that Canadian politicians have done nothing to connect any of these dots, is only evidence that they are all willing participants in this scheme by the life insurance industry to deprive Canadians of real investment choices and replace this wider array of choice with a limited set of choices that favour the life insurance industry itself. Meaning Canada is devoid of a Barack Obama or a Tommy Douglas with the current crop of politicians to chose from, namely Harper, Ignatieff, Layton and Duceppe. Their complicity is like a disease.

As for Duceppe’s talk over the weekend about the Bloc being the equivalent of the French resistance in the Second World War, I would argue that the Bloc is more like the Vichy Government of the second world, more than happy to accommodate the German occupiers, expect in this case its the life insurance industry the Bloc are more than happy to accommodate, along with the other members of that Vicchy government mindset, Harper Ignatieff and Layton, who along with 18 pages of blacked out documents as “proof” of tax leakage are all traitors to the principles of true democracy, as their silence is complicity of the worst kind.