Today’s Globe has an article about Jim Flaherty, entitled “One day, we’ll look back and thank Jim Flaherty”, in which they gloss over his income trust policy fiasco with the statement:
“Then, in 2006, Flaherty’s killing of income trusts wiped out more than $20 billion in stock market value overnight. Although the move was probably necessary to preserve tax revenues, it released a tsunami of vituperation from a business community that was none too happy to have the punch bowl taken away just as the party was getting started.”
Was probably necessary to preserves tax revenues? What kind of justification is that? Probably? Would the Globe and Mail like to share with its readers how it makes the claim that income trusts probably adversely affect tax revenues? Did the Globe flip a coin or use a roulette wheel to determine this probable outcome? Meanwhile, since when is “probable” the standard of certainty to apply when engaging in far reaching public policy making, when the matter at hand can be ascertained with absolute certainty as HLB Decision Economics was able to do in their study of November 2005 entitled The Tax Revenue Implications of Income Trusts that was available to all (including Jim Flaherty and the Globe and Mail) and which concluded that income trust s DO NOT cause the loss of tax revenue.
Furthermore, if income trusts “probably” cause the loss of tax revenue, then why is Flaherty hiding his tax leakage analysis behind 18 pages of blacked out documents? Could it be that he is lying? Dare the Globe and Mail have the journalistic integrity challenge Jim Flaherty to prove his case, as Diane Francis of the Financial Post did in her article entitled Prove the case or drop the tax?
Perhaps the Globe and Mail would like to take a more disciplined approach to this matter and let its readers know with greater certainty about whether Flaherty’s policy actions were just and whether his (and their) assertions about tax leakage are true or not, rather than adopting Flaherty’s reckless and cavalier attitude to policy matters of great import, since even the Globe admits that $20 billion (actually $35 billion) of Canadians’ life savings were lost, while failing to acknowledge that Flaherty’s actions actually CAUSED the loss of tax revenues amounting to over $1 billion per annum from the wave of foreign takeover of income trusts than ensued. All to fix a non-existent tax leakage problem. Could the man be more incompetent if he tried and the Globe more intent on covering this story up?
Friday, August 27, 2010
Posted by Brent Fullard at 9:36 AM