Saturday, December 24, 2011

CAITI's Outstanding Canadian of 2011 Award: Bill Vander Zalm

Bill Vander Zalm's successful fight against the Harper government's regressive HST is a MOST RARE example of democracy in action in Canada:

How it felt: To lead a revolt that killed a sales tax and helped drive a premier from office

Globe and Mail
Published Friday, Dec. 23, 2011 8:43PM EST

Former Social Credit premier Bill Vander Zalm was at the forefront of a fight to kill the province’s HST tax. About 700,000 signatures were gathered to spark a referendum

When we announced the initiative campaign, many in the media said it could never be done. We started up north, thinking this would be the most difficult area. When Fort St. John, a normally Conservative/Liberal area, gave us a rousing welcome with prominent party members offering to lead the campaign in their area, we knew the people were definitely on side.

The signature collecting started in 2010. Our fearless signature collectors worked outside in rain, sleet and snow. People were wonderful, wished us well and brought us hot drinks.

When big business saw they might lose it, they brought on a court case, claiming our petition was unconstitutional. With little resources against megabucks, we fought and won.

The most memorable days came when the petition sheets began rolling back from all over the province. They came hand-delivered, by Greyhound, by FedEx or by Purolator to our house. When the media asked where these went, we responded “the vault” – a large room in our house with double-lock doors. We refused to tell them where and what “the vault” was. If one box, from any one constituency was damaged, we would lose the fight.

For many weeks, our normally tidy house was a disaster. My wife Lillian checked every one of 100,000-plus petition sheets, which were spread out everywhere. We even refused visitors to come to the house, no one was to know.

Two weeks before the due date, we loaded up a rental truck for delivery to Elections BC in Victoria. What a celebration.

— Written by Bill Vander Zalm

Thursday, December 22, 2011

You Go Girl!

Helena Guergis suing Prime Minister Stephen Harper
CBC News
Posted: Dec 22, 2011 4:19 PM

Former MP Helena Guergis has launched a lawsuit against Prime Minister Stephen Harper and her former party for defamation and other claims. Former MP Helena Guergis has launched a lawsuit against Prime Minister Stephen Harper and her former party for defamation and other claims. (Darren Calabrese/Canadian Press)

Former MP Helena Guergis is suing Prime Minister Stephen Harper, Conservative MPs Shelly Glover and Lisa Raitt, the Conservative Party of Canada and a number of other individuals for defamation and other claims.

The former member of Harper's cabinet, who had to leave the Conservative caucus following allegations against her and her husband, former MP Rahim Jaffer, launched the court action in Ontario's Superior Court of Justice and the statement of claim was obtained by CBC.

Guergis is not only suing her former boss and colleagues, but also Ray Novak, Harper's principal secretary, Arthur Hamilton and the law firm he works for, Cassels Brock & Blackwell, Guy Giorno, Harper's former chief of staff, Axelle Pellerin, and Derrick Snowdy. Snowdy is the private investigator from Toronto whose allegations helped spark the controversy around Guergis and her husband.

She is suing Harper and most of the others named in the lawsuit for defamation, conspiracy, intentional infliction of mental suffering and negligence.

Guergis is suing for general damages of $800,000 plus punitive damages of $250,000 and aggravated damages of $250,000.

Flaherty's smack down

Supreme Court rejects national securities regulator plan

By Drew Hasselback, Financial Post December 22, 2011 10:06 AM

The Supreme Court of Canada has ruled on the constitutionality of a national securities regulator, as proposed by the federal government.

OTTAWA — The federal government's ambitious plan to set up a single national securities regulator has been dealt a severe blow by the Supreme Court of Canada, which ruled Thursday that Ottawa's proposed legislation is unconstitutional.

In a ruling that is bound to disappoint Ottawa, Ontario, and several business groups, the Supreme Court held that oversight for the investment industry fits squarely within the "property and civil rights" powers that are assigned to the provinces by the Constitution Act of 1867.

Ottawa had tried to claim control over the securities business by invoking its regulatory power over trade and commerce, but the Supreme Court ruled that the federal government's plan overstepped the constitutional boundaries that case law has erected over time to prevent Ottawa from overusing that power.

In the unanimous decision, which was released by the court and is therefore not attributed to any specific judge as author, the court says Ottawa's planned approach would dive too deeply into the day-to-day operations of the securities industry, which are contractual in nature and therefore fit squarely within the provincial power over property and civil rights.

Yet the ruling does suggest that it would be possible for both levels of government to seek "common ground" and share oversight of securities, with the provinces able to look after the day-to-day aspects of the industry and the federal government able to keep an eye on systemic risk.

"While the proposed act must be found ultra vires (beyond) Parliament's general trade and commerce power, a co-operative approach that permits a scheme that recognizes the essentially provincial nature of securities regulation while allowing Parliament to deal with genuinely national concerns remains available," the court's written 64-page written ruling states.

Finance Minister Jim Flaherty introduced the Proposed Canada Securities Act in May 2010. The federal government's plan called for the provinces to voluntarily join a scheme that would gradually transfer regulation of securities to a single national regulator from the current patchwork of 13 provincial and territorial securities commissions.

The federal proposal is too heavy handed and upsets the existing constitutional balance that exists in the division of powers, the court said.

"Co-operation is the animating force. The federalism principle upon which Canada's constitutional framework rests demands nothing less."

The court's reasoning strictly adheres to previous court rulings and treats the question before the court as a legal problem, not a policy one. It applied a five-step test from a 1989 decision called General Motors that sets out the boundaries for the federal government's trade and commerce power. The essence of the test is to determine whether the federal government seeks to oversee something that would be beyond the ability of the provinces to regulate on their own.

For generations, previous court rulings have confirmed that securities oversight was a provincial competence under the "property and civil rights" provisions of the Constitution.

Indeed, provincial courts of appeal in Alberta and Quebec have previously concluded that Ottawa's planned legislation is constitutionally out of bounds. Alberta's Court of Appeal last March ruled 5-0 that Ottawa lacked the power to regulate securities, while Quebec's court in early April rejected Ottawa's plan in a 4-1 ruling.

In a decision that reiterates long-held constitutional boundaries, the nine Supreme Court judges unanimously confirmed that Ottawa's legislations fails the constitutional test.

Financial Post
© Copyright (c) Postmedia News

Read more:

Monday, December 12, 2011

David Johnston's defining moment: Will he uphold the rule of law or not?

Liberals Ask Governor General to Withhold Royal Assent from Illegal Conservative Wheat Board Bill

OTTAWA– In a letter delivered today to Rideau Hall, Liberal Leader Bob Rae asked the Governor General to consider withholding royal assent from Bill C-18, in light of last week’s Federal Court decision that found the government to be in breach of the law.

“This Conservative government is using their majority to force through their legislation to kill the Canadian Wheat Board, despite the Federal Court’s ruling that the Agriculture Minister's conduct is an affront to the rule of law,” said Mr. Rae. “Given this condemnation of the government’s attempt to unilaterally dismantle the Canadian Wheat Board, and given their decision to appeal, it would be inappropriate to proceed with the legislation until these matters have been exhausted before the courts.”

On December 7, 2011, the Federal Court issued a ruling finding the Government of Canada’s refusal to respect the statutory mandate to convene a plebiscite for farmers prior to dismantling the Canadian Wheat Board contravened s. 47.1 of the Canadian Wheat Board Act. Judge Campbell characterized “the most important effect” of granting the Breach Declaration as holding the responsible Minister “accountable for is disregard of the rule of law”.

“As the intent of Bill C-18 is inextricably linked to the question of whether the Government fulfilled its obligations to consult with affected farmers, it would be entirely within the Governor General’s prerogative to withhold royal assent until the outstanding questions of law and any on-going court processes were sorted,” said Mr. Rae. “As Canadians clearly cannot count on this Conservative government to do the fair and lawful thing and not proceed with this legislation, we hope that the Governor General will use his discretion and prevent this illegal bill from becoming law.”


Saturday, November 26, 2011

And to think: You asked why we cared about income trusts?

Image: Canadians Occupy Parliament over Flaherty's lie about "tax leakage" from income trusts

Canadians' vanishing retirement incomes

NOVEMBER 26, 2011 3:07 AM

Canadians have lost a lot over the years. A generation ago, most people could count on buying a home for the equivalent of about three year's salary. That dream is gone.

And a generation ago, most people could count on retiring with a guaranteed pension from their company. They knew how much they would get, and, with Canada Pension Plan and old age security, they could count on a comfortable retirement.

It's extraordinary how that has been taken away, with no real debate.

Companies decided defined benefit plans - ones that paid a guaranteed retirement income - were too costly.

Employee and company paid into defined benefit plans. If the reserves looked like they might not provide the promised benefits in future, they had to be topped up.

So companies pushed to eliminate the plans, or change them to defined contribution plans. Employees and company would contribute and the funds invested. The pension would be based on however much money was in the fund on retirement. There was no obligation to provide an income. (Government workers, including MPs and MLAs, still have defined benefit plans. Politicians believe you should pay for guaranteed pensions for them, but not that you should have one.)

And work changed, from long-term employment with big companies to much less certain work, often parttime or on contract, and without any pension.

Only one in four British Columbians has a workplace pension today.

This huge change in the social contract hasn't been discussed. And while workplace pensions have been slashed, there has been no corresponding increase in public retirement benefits. Those benefits are low compared to other OECD countries, in large part because Canadians could once count on workplace plans.

The Harper government has offered a token response to the pension problems with legislation allowing new pooled pension plans.

It's a lame response to a real problem. The new plans would give small business the opportunity to provide a pension plan by signing a deal with a bank or investment company.

The employees would have the voluntary chance to contribute, and the employer could also contribute if he chose (not that likely, I'd say). The investment firm would take its cut for managing the money and the savings would be available at retirement.

Some employers will offer the plan. Some people will sign on. But not many. And there is no benefit over RRSPs; people who have not contributed to their own retirement fund, for whatever reason, are unlikely to opt into a voluntary pooled plan.

The government could have easily made the plan at least slightly better. It could have allowed the pooled plans, and had the funds managed by the Canadian Pension Plan investment experts. That's similar to the approach taken in Saskatchewan, where such a plan already exists. That's also the model promised by the B.C. government in 2008, and never delivered.

That would have provided excellent money management at the lowest cost. Instead, the Harper government offered the banks and the investment houses the chance to manage the money and collect the fees.

That's strange, because earlier this year Finance Minister Jim Flaherty called for an investigation into the high fees charged by providers of Canadian mutual funds and other investments. A study found Canadians pay more than twice as much in management fees as Americans. Those costs significantly reduce the money being available for retirement. Now Flaherty is opening a new market for them.

This isn't just an issue for those nearing retirement age.

The giant baby boom bulge is now nearing 65. In 1971, there were 6.2 British Columbians of working age for every person over 65. By 2034, there will be just 2.4 working-age people for each person over 65.

If boomers push for better pensions, the cost will fall heavily on those still working.

Footnote: The best option would be an increase in CPP benefits, now capped at about $935 a month. That would require increased contributions by employees and employers.
© Copyright (c) The Victoria Times Colonist

Thursday, November 24, 2011

Hill Times tribute to W. T. Stanbury

Erudite, authentic Hill Times columnist Stanbury, ‘a giant’ in academic area of democratic reform, dies at 68

W.T. Stanbury was one of those remarkable minds who don’t come along too often, says Armine Yalnizyan, senior economist at the Canadian Centre for Policy Alternatives.

By KIRAN RHINES | Nov. 21, 2011

W.T. Stanbury, who had written a popular weekly column since 2002 for The Hill Times and was considered a “giant” in the academic world of government accountability, died last month at his home in Mexico from a terminal illness. The former economist, professor, and prolific author died on Oct. 27 at the age of 68.

Mr. Stanbury had a long, industrious career in business and economics. He received a bachelor of commerce from the University of British Columbia, and his MA and PhD degrees in economics from the University of California at Berkely. He was a professor of commerce and business administration of the University of British Columbia from 1970 to 2000.

Between June 1978 and August 1980, he also worked as director and later research director of the regulation reference at the Economic Council of Canada. From there he became director of the regulation and government intervention program at the Institute for Research on Public Policy. Mr. Stanbury also served on the Royal Commission on Electoral Reform and Party Finances from 1989 until 1991.

“Though he was a professor of economics and not a political scientist, he had come to focus his active curiosity and lively intelligence on the structure and operations of the Canadian political apparatus,” said Thomas Hall, a retired House of Commons procedural clerk, and collaborator with Mr. Stanbury on several columns in The Hill Times over the years.

“One of our articles, on judicial appointments, in [The Hill Times] even led to correspondence and a conference call with the Baroness Prashar, who was then chair of the English Judicial Appointments Commission,” Mr. Hall said. “Bill joked that if I stuck with him, he’d introduce me to new people and things. That he certainly did.”

Over the span of his illustrious career, Mr. Stanbury wrote more than 250 publications, including more than 30 books, on a wide variety of subjects such as competition policy, government regulations, and intervention on the market, and government implementation of financial policies.

“He spoke the truth and tried to cut through all the hype and nonsense in evaluating government policy,” said Brent Fullard, president of the Canadian Association of Income Trust Investors. “That made him a bit of a rarity. There’s too few people out there who speak truth to power and he did so with authority. I have enormous respect for him and the approach he took.”

Mr. Fullard and Mr. Stanbury had maintained a professional relationship since 2007. Both men did advocacy work against the income trust tax implemented by Prime Minister Stephen Harper’s (Calgary Southwest, Alta.) Conservatives in 2007.

Mr. Stanbury wrote many articles that criticized the tax. In his last days he wrote one last book, which was an in-depth analysis of the income trust tax. It was his dying wish to have it finished before he passed away, said Mr. Fullard. The book is on the verge of being published in an electronic edition on

He was also the author of many other books, including Business-Government Relations in Canada: Influencing Public Policy, Canadian Competition Law and Policy at the Centenary, co edited with R.S. Khemani and Money in Politics: Financing Federal Parties and Candidates in Canada.

“He was a giant in the academic area of democratic reform, and thankfully was expressing his knowledge and views much more publicly in recent years with his Hill Times column,” said Duff Conacher, founding director of Democracy Watch.

Mr. Stanbury’s weekly column was called “Stanbury’s View” and was a critical analysis of government policies. More academic than journalistic in style, his columns were always jammed full of references, notations, facts, quotes, and they usually offered a scathing critique of the government’s lack of transparency, accountability, the income trust tax, increasing government secrecy, or the increasing power in the PMO/PCO, among a host of other topics.

“It’s a tragic loss for Canadian democracy, in general, and the world of ‘access,’ in particular,” said Michael Drapeau, law professor at the University of Ottawa and a former colleague of Mr. Stanbury’s.

“Professor Stanbury was a giant. I admire him for his academic and erudite qualities and, his warm and friendly disposition. Thoughtful, authentic, and devoted always to making society a better, fairer and open environment for everyone,” he said.

“He’s one of those remarkable minds that don’t come along too often,” said Armine Yalnizyan, senior economist at the Canadian Centre for Policy Alternatives. “He will be hugely missed.”

Ms. Yalnizyan and Mr. Stanbury had been emailing back and forth for the last year-and-a-half, discussing common economic interests. He contacted her after coming across some of the economic research she wrote about in her blog, Ms. Yalnizyan said.

Ms. Yalnizyan described him as her mentor.

“He would push and prod, and you’d always come out of a conversation much enriched for the discussion and a little bit more intellectually honest actually,” she said. “You can run but you can’t hide from the facts.”

Mr. Stanbury stayed in touch with his colleagues and wrote his columns from his home near Guadalajara, Mexico.

He moved there after his retirement and lived there with his common law wife Hebina Hood and their dogs.

John Chenier, co-founder of The Lobby Monitor in Ottawa, said: “I was quite shocked to hear of Bill Stanbury’s death. His passing will leave a big hole in the public discourse conducted through The Hill Times.”

Kate Malloy, editor of The Hill Times, said Mr. Stanbury’s column will be missed by many readers, especially those who like to closely follow accountability in government and federal politics.

“Every week and year after year, Bill would file his sometimes massive column. I could always count on slotting a full page, at least, which is a lot of space for a column. We would argue about word count and he wasn’t happy about having to cut it down, but he always filed on deadline and he always knew exactly what he wanted to say,” said Ms. Malloy.

Ms. Yalnizyan said he was a successful investor and wanted to live in a warmer climate as soon as possible.

“He loved to rub it in my face by showing me pictures of roses blooming in his garden in January,” she said.

Monday, November 21, 2011

Sheila Fraser is now officially in bed with Manulife

Isn't it strange that Canada's Auditor General Sheila Fraser refused to investigate whether the Harper government's claims of tax leakage from income trusts was a valid policy argument or not? In her role as Canada's Auditor General she was asked on numerous occasions by numerous groups and many thousands of Canadians to do so and refused. She even refused the written request of the Liberal Members of the Finance Committee to report on the validity of tax leakage, or not, thereby making a total mockery of her mandate which is described on her website as "Parliamentarians need objective and fact-based information about how well the government raises funds." Evidently not!

One of the greatest beneficiaries of the Harper government's move to kill income trusts and Sheila Fraser's dereliction of duty and one of the groups that lobbied hardest for this regressive government policy was Manulife Financial, since they were having a hell of a time selling their inferior retirement investment products in the face of Canandians' growing preference for income trusts. So what was Manulife's strategy? Engage in massive government lobbying and position yourself to benefit from the litany of falsehoods about income trusts, such as the allegation that income trusts cause tax leakage, which any Auditor General worth her salt could have easily proven was a crock of nonsense.

Is is any wonder that Sheila Fraser has now been appointed to the board of Manulife?

Here's the letter from the Liberals that Sheila Fraser ignored:

For Immediate Release
February 29, 2008

Liberal Finance Committee Members call on Auditor General to Examine Government's Claims of Income Trust Tax Leakage

OTTAWA - Liberal Members of the Standing Committee on Finance today called on the Auditor General to investigate the tax leakage claims that the government used as the basis for its October 31, 2006, decision to tax income trusts.

"I think that this government's stonewalling has gone on long enough and it's time that Canadians got to see that the Government simply made up its story that income trusts cause federal tax leakage," said Liberal Finance Critic John McCallum.

"Prime Minister Stephen Harper promised to Canadians that he would never tax income trusts. Then he went back on his word, costing Canadians billions overnight and in the wake of his silence on the issue we feel that only the Auditor General can shine some light into this matter."

All four Liberal Members of the Finance Committee signed a letter to Auditor General Sheila Fraser asking her to investigate the matter, particularly the government's unproven allegations about income trusts causing tax leakage.

"This has clearly become much more than just another instance of the government not doing its homework before acting. It has become a full-blown scandal and cover-up," said John McKay, Member of Parliament for Scarborough-Guildwood. "We have tried virtually every tool at our disposal to get the government to show us how they came to their conclusions about tax leakage and the Auditor General may be Canadians' last resort."

An Access to Information request asking for the Department of Finance's assumptions, data and methodology resulted in the release of only 23 pages of documents that are almost entirely blacked out.

A direct request from the Finance Committee to see the data was met with two thick binders of superfluous information that did not contain the data or methodology originally requested.

A written question was placed on the Order Paper asking the government to recalculate its estimate of tax leakage using the 15 per cent federal corporate tax rate that will actually be in effect in 2012, the year after the income trust tax begins, as opposed to the 21 per cent tax rate that was in effect at the time of the announcement. The government's response to the question indicated that that this would be a hypothetical calculation and therefore impossible to do.

"That's not a hypothetical, that's what the federal tax rate will be," said Garth Turner, Member of Parliament for Halton. "If the government can't manage to run the new 2012 corporate tax rate through their calculators then I have no reason to believe they ran the old one through their calculators in October of 2006."

In 2006, Stephen Harper ran on a campaign commitment to never tax income trusts. The Conservative election platform characterized any attempt to impose such a tax as, "An attack on retirement savings."

"That election commitment was obviously a falsehood. Unfortunately the voters who believed it and invested even more money in income trusts lost a significant portion of their nest eggs," said Massimo Pacetti, Member of Parliament for MP for Saint-Léonard-Saint-Michel.

"Even today, 15 months after they broke their election promise, Members of Parliament still hear from the thousands of Canadians whose retirement plans were shattered by this deception. Liberal Members of Parliament continue to stand up for them."


Here's perhaps the reason why:

Sheila Fraser appointed to Manulife Board of Directors

TORONTO, Nov. 3, 2011 /CNW/ - Manulife Financial Corporation and The Manufacturers Life Insurance Company announced today that Sheila Fraser has been appointed to their Boards of Directors, effective November 2, 2011. Ms. Fraser will sit on the Audit Committee and the Conduct Review and Ethics Committee.

Ms. Fraser served as Auditor General of Canada from 2001 to 2011. Prior to joining the Office of the Auditor General as Deputy Auditor General in 1999, she was a partner at Ernst and Young for 18 years.

Her contributions to the accounting and auditing profession include her current role as member of the International Federation of Accountants-International Public Sector Accounting Standards Board (IFAC-IPSASB). She has also chaired two committees of the International Organization of Supreme Audit Institutions (INTOSAI) as well as the Public Sector Accounting Board of the Canadian Institute of Chartered Accountants.

Ms. Fraser earned a Bachelor of Commerce from McGill University, is a Chartered Accountant and among her many honours has received the designation "Fellow" from the Institute of Chartered Accountants of Ontario and the Ordre des comptables agréés du Québec.

"Ms. Fraser's financial background, management experience as Auditor General of Canada and leadership roles on international accounting issues make her an important addition to Manulife," said Manulife Chair, Gail Cook-Bennett. "We are delighted to welcome Sheila Fraser to our Boards."

Thursday, November 10, 2011

Stockwell Day signs up for reverse mortgage scam

Stockwell Day has signed on as a Director of HOMEQ Corporation, who are engaged in the field of reverse mortgages, where seniors strapped for cash resort to selling their homes for 40 cents (or less) on the dollar. I consider that a scam and an act of financial desperation/exploitation.

Thanks to people like Stockwell Day, Canadian seniors are more strapped for cash now than ever what with the protracted low interest rates providing them with less income from their limited retirement savings.

As a prominent member of Stephen Harper's cabinet, Stockwell Day participated in the destruction of income trusts, which had emerged as the Canadian capital market's solution to the problem of Canadians providing for themselves with sufficient income during retirement, rather than resort to means like reverse mortgages. That preferred solution was summarily taken off the table when the Harper Conservatives made the fraudulent argument that income trusts cause tax leakage, denying Canadians that choice and casuing great financial hardship.

Meanwhile here is what the duplicitous Stcokwell Day wrote while in opposition on the matter of income trusts:

November 8, 2005.

Dear Mr. Laxton

Thank you for expressing your concerns about the confusion the Minister of Finance has caused on income trusts.

Income trusts have helped numerous Canadian companies grow and flourish and enabled ordinary Canadians to generate more income for their retirement years. The federal Liberal government's reckless decision last September to cancel advance tax rulings on income trusts caused Canadian businesses to lose billions of dollars in market capitalization and Canadians to lose thousands of dollars of personal savings.

Canadians investing in good faith to save for their retirement deserve certainty, not a government review of how the Liberals can grab more taxes from them.

We know that Canadians draw regularly form their investments to supplement their retirement savings. When the value of their investments drops as a result of government indecisiveness, so does their retirement income. It is time the government stopped penalizing our citizens.

My colleagues and I in the Conservative Party are committed to maintaining income trusts as a valuable savings and investment tool for Canadians.

Thank you again for contacting me,

Yours sincerely,

[signed Stockwell Day]

Stockwell Day, M.P.
Official Opposition Foreign Affairs Critic

Thursday, November 3, 2011

Mark Carney on the Canadian Wheat Board

"It is imperative there is widespread democratic support for those measures," said Carney.

Sorry, Mark Carney was talking about Greek citizens and their bail out package, and NOT Canadian wheat farmers and their Canadian Wheat Board. Surprised?

Ooops! Could Mark Carney have been more WRONG on Greece?!

THEN: Carney supports Greek referendum
November 1, 2011 | 16:04
By MARK DUNN, Senior National Reporter | QMI Agency

OTTAWA - Canada's top banker says he fully respects a bombshell decision by Greece to hold a referendum on a bailout package that sent global financial markets into a tailspin Monday.

Bank of Canada governor Mark Carney appeared before a Commons committee Tuesday, on the eve of a G20 summit in France, where the crisis in Greece has prompted calls for the country to be tossed from the European Union.

"If this is Greece's decision, we fully support that," Carney said about embattled Greek prime minister George Papandreou's declaration to let his countrymen decide whether to accept last week's eleventh-hour rescue package.

"It is imperative there is widespread democratic support for those measures," said Carney.

The worsening financial situation and the potential for Greece to reject the $180-billion bailout risks sending the country into default.

NOW: Papandreou scraps Greek referendum as internecine erupts in his party

Greece's prime minister clings on to power on day of drama, but is likely to lose Friday's confidence vote in Greek parliament

Helena Smith and David Gow in Athens,
Thursday 3 November 2011 21.29 GMT

The Greek prime minister, George Papandreou, has been forced by open warfare in his socialist party to cancel a planned referendum on the latest bailout package for his near-bankrupt country as he fought for political survival amid mounting scepticism over the crisis-hit nation's future in the eurozone.

After a day of high political drama, intrigue, farce and rumour, Greece descended further into chaos as Papandreou, clinging desperately to power, insisted on holding a confidence vote in his administration on Friday. But, as his majority shrivelled to just one, he also said talks over the creation of a unity government were already underway.

Wednesday, November 2, 2011

Stevie the Steamroller strikes again

My comment on:

Only a lunatic (i.e. Harper) would take such an unwarranted action of destroying the Canadian Wheat Board. Of which, the net benefit to Canada and all Canadians will be VASTLY negative. Any chance that Brian Mulroney, Director of US agri-giant ADM is behind this lunatic move? Canada's loss will be ADM's gain and others like it. Small farmers will be marginalized and their land acquired on the cheap by larger (foreign) interests, as the collective selling power of the CWB becomes a free for all in the marketplace for wheat, and farmers lose any control over pricing. Any economist worth their salt would predict that the outcome of this will be negative. I thought Stephen Harper was a "trained economist"? Instead he must be a trained anarchist...... or a total ideological fool.

Steamroller Steve strikes again! Just as he did with the gun registry, income trusts, the nuclear safety watch dog. The list goes on........

Monday, October 31, 2011

Jailing the homeless 2.0

Need you be reminded, the following was written about Jim Flaherty's first failed attempt to become leader of the Ontario Conservatives and his policy of jailing the homeless:

Scourge of the homeless
The Globe and Mail
February 16, 2002

"Ontario Finance Minister Jim Flaherty was looking for publicity, and he found it. When quizzed by reporters, he had no idea what his policy of dragging the homeless off somewhere, anywhere, would cost. He just wanted it done. He wanted to solve a complex social problem by sending out special police squads.”

Will Jim Flaherty be the next leader of the Ontario Tories?
By Andy Radia | Canada Politics – Fri, 28 Oct, 2011
Yahoo News

Stephen Harper could be losing his most senior cabinet minister.

A column in Thursday's Toronto Star notes there are good reasons to believe finance minister Jim Flaherty will shift to provincial politics and make a play for the leadership of the Ontario Tories.

"(Flaherty) is reportedly tired of the heavy international travel required in his job, which keeps him away from his Whitby home for long stretches at a time. Also, Flaherty realizes his boss, Prime Minister Stephen Harper, isn't likely to step aside until well after the next election in 2015. Flaherty, who finished second to Eves in the 2002 provincial leadership race, has made little secret that he wants to run his own show," journalist Bob Hepburn notes.

"At the same time, Flaherty's wife, MPP Christine Elliott, who ran and lost against Hudak in 2009 for the party leadership, is said to be tiring of Queen's Park and would happily step aside for her husband to run in her Whitby-Oshawa riding."

Losing Flaherty would be a significant loss to the Harper government.

Canada's finance minister is well-respected both nationally and internationally and is credited for successfully steering Canada through the last recession.

But Canada's loss would be Ontario's gain - and Tim Hudak's pain.

Even without the threat of a Flaherty leadership bid, Hudak, the current leader of the Ontario PCs, was already headed for troubled waters.

Paul Tuns of the Ottawa Citizen suggests there are many Conservatives who blame Hudak for not dislodging the Liberals from power despite a double-digit lead in the polls just 12 weeks before the October 6 election.

Adding to Hudak's woes, is the decision by Tory MPP and former leadership rival, Frank Klees, to break ranks with Hudak and run for speaker of the legislature.

Klees's move is a blow to Hudak because if he becomes Speaker, he would reduce the number of voting opposition members to 53, the same number the minority Liberal government has.

And, by virtue of parliamentary tradition, the Speaker votes with the government on crucial issues, which would result in the Liberals staying in power until 2015.

The Conservatives' constitution requires the party to hold a leadership review vote at the first party convention after an election defeat, notes Hepburn.

If Flaherty were to declare his intention to seek the leadership before the convention planned for early 2012, it could spell the end for Hudak's reign as PC leader.

Tuesday, October 11, 2011

Creating perception of a crisis to sell the huge tax on income trusts in 2006

By creating the perception of crisis—when none in fact existed—the Harper government made it easier to sell an extreme policy action to voters, one that effectively eliminated a useful form of business organization.

Income trusts: One of the most important elements of the Harper government’s strategy for selling the new 31.5 per cent tax on most publicly-traded income trusts, announced on Oct. 31, 2006, was to convey to the public the idea that the government faced a crisis induced by a series of exogenous events, argues columnist W.T. Stanbury.

By W.T. STANBURY | Oct. 10, 2011
The Hill Times

One of the most important elements of the Harper government’s strategy for selling the new 31.5 per cent tax on most publicly-traded income trusts (announced on Oct. 31, 2006) was to convey to the public—largely through the news media—the idea that the government faced a crisis induced by a series of exogenous events. Recall that when he was opposition leader, Stephen Harper had repeatedly and clearly said less than a year earlier that he would not tax income trusts—as he claimed that the previous Liberal government was about to do (see Stanbury, The Hill Times, Jan. 26, 2009).

Crises Can be Useful Tools to Effect Major Changes

A crisis situation, or the perception of a crisis, may well induce people to see things in a different light, and to allow—even approve—changes that were previously held to be “unthinkable.” Under such a situation, managers may introduce a series of changes that they have wanted to make for some time, but could never gain sufficient support to be implemented. Note that some of the changes need not be related to the problem at hand.

The perception of a crisis may cause people to panic—and thereby act irrationally or at least fail to carefully evaluate the alternative possible (and practicable) responses to the problem situation.

A real crisis is a situation where—if appropriate action is not taken promptly—will almost certainly result in great harm to people and or property. And it may be that some aspects of the harm are not reversible later.

A government can use the perception of a crisis to take strong actions, and then justify the move later by providing “evidence” that there was a crisis that forced it to act as it did. The evidence is couched in emotive rhetoric that usually emphasizes the very bad things that would have happened if the strong action had not been taken.

Note that the government’s stated justification need not be the real reasons for the strong actions—they only need to be seen as plausible. A widely-shared perception of a crisis can make the stated reasons for strong actions far easier to accept. The crucial element here is the creation of fear.

Even with its extraordinary array of communications machinery, it is difficult for a government to create the widely-shared perception of a crisis “out of whole cloth:” i.e., where there is—in truth—no indication that a crisis situation exists (think of the movie Wag the Dog). But what is far easier for a government to do is to build upon exogenous events whose meaning is somewhat ambiguous, and to change the public’ perception of them from “a matter of concern” into a “crisis” by proclaiming them to be fearful—justifying rapid and strong action. To create a widely-shared perception of a crisis requires the artful manipulation of the news media. This can be done both prior to and after the government acts. An important part of the phony crisis strategy is to keep the decision-making process secret and limited to a few people

Elements for the Creation of a Phony Crisis

First, it is much easier to create a phony crisis if there are exogenous events that have already raised legitimate concerns among Ottawa policy-makers. Note, however, that the true nature of the problem may not be well understood or could be misunderstood due to the mindset (analytical frame) of the officials in the department responsible for monitoring these events/developments (in this case, Finance). These exogenous events can be built upon to create the perception of a crisis, for example, by exaggeration and the failure to provide perspective.

Second, there must be one or more high status persons inside government who act as “pushers” for certain policy actions and they must be prepared to try to create a faux crisis to “sell” those actions to the public. (The pushers within government may be responding to pressures from interest groups. CEOs and directors lobbied in secret in 2006 and pressed the government to kill the trusts for entirely self-interested motives, although their justification was couched in terms of concerns about reinvestment, growth and competitiveness.)

Third, there must be a comprehensive communications plan to use the news media to get the public to believe there is a crisis—or that there was a crisis. The support of the news media is essential to help disseminate to voters the idea that there was a crisis situation requiring strong and swift action. Support in this context may mean nothing more than reporting the government’s claims without comment or effort to ascertain their veracity. The claimed perils of the situation were the justification for the hug e-tax on income trusts, and the reversal of the PM’s solemn promises made in the fall of 2005 when he was opposition leader.

The creation of a phony crisis was helped by the proposition that, in politics, perception, not substance, is everything. The related important points are these: (i) initial perceptions can be created near instantaneously, (ii) they can be created on very limited “evidence” or information (think of the half-second appraisal people give when meeting a person for the first time), (iii) the perception can be misleading, distorted, even utterly false in terms of the substance, (iv) perceptions—even false ones—can be very hard to change. See Stanbury, The Hill Times, Aug.15, 2011, and Aug. 22, 2011.

In the case of the income trust tax, the ability of the government’s communications plan to convince the news media and through them to the public that there was a “crisis” was greatly assisted by the complexity of the income trust tax issue.

Further, the simple, frequently-repeated message created by the so-called “Tax Fairness Plan” (see Stanbury, The Hill Times, March 7, 2011) overwhelmed the few deeper analyses of the issue which showed that the government’s central claims (most notably about “tax leakage”) were false or seriously misleading.

The Minister of Finance, Jim Flaherty, was the single largest purveyor of the statements after the “Halloween Surprise” of false, misleading and unverifiable statements intended to create the perception of a crisis words were used as tools to create certain images in the minds of his listeners to achieve his political objectives.

Details Related to Creating the Phony Crisis:

Here are some of the things the Harper Government did to create the perception of a crisis:

• The new tax was announced in the most dramatic possible fashion—on Halloween.. This is what Flaherty’s director of communications called an “event.”

• The rapid rate of growth in the in the trust market was emphasized—and made fearful. Fear is a powerful motivator.

• Denigrating comments were repeatedly made by the minister of Finance to the effect that Canada was becoming a “trust nation” and a “nation of coupon clippers” and the stagnation in the growth of our economy with companies that are alleged to not reinvest in their business or in new technology. This argument was intuitively appealing and was the conventional wisdom of the executives who secretly lobbied against the trusts in 2006.

• In the technical paper released Jan. 28, 2007, Finance’s estimates of so-called “tax leakage” not only failed to include deferred taxes (serious methodological error), but also contained several other errors, each of which had the effect of inflating the estimate. This was proven by Dennis Bruce in his testimony before the Commons Finance Committee on Feb.1, 2007. He estimated the revenue losses for the federal government in 2006 to be $164-million, not $500-million as claimed by Finance—and that by 2010, the leakage would be just $32-million per year.

• Finance officials (and the minister) invoked the (supposedly) prestigious name of professor Jack Mintz whose own estimates of the revenue losses were larger than those of Finance for 2006. Mintz publicly defended the tax and defended Finance’s flawed methodology which omitted deferred taxes. Privately, however, Mintz was critical of the serious omission of personal income tax on units inside tax deferral accounts.

• The government provided no sense of perspective for the claimed “tax leakage:” $500 million for 2006, then later $1.1-billion (per Mintz) assuming Telus Corp and BCE Inc. had converted to trusts as they had announced they planned to do on Sept.11 and Oct.11, 2006 respectively. However, both estimates were grossly exaggerated. Yet they sounded large to ordinary folks, but they were tiny when put into a proper perspective. For example, the federal government’s total tax revenues in 2006 exceeded $160-billion. Corporate income tax revenues in 2006 were $37-billion. The federal surplus was then $12-billion.

• The minister made repeated reference to rumours of more possible conversions of large corporations to trusts, and claimed that such conversions would have near apocalyptic consequences—including the end of fiscal transfers to the provinces and big cuts in money for health care. The minister and other spokespersons made endless slanted or false statements where reporters were present. No reporter knew enough about this complex issue to “call” the minister on any of his statements. Columnist Diane Francis was a conspicuous exception.

• The “building blocks” for the rhetoric that there was a crisis and the government had to act quickly and strongly: The claimed growing “tax leakage”– in time to absorb all the surplus and return to deficits (horrors!); Rapid growth in the number of trusts– “becoming a trust economy;” It was claimed that the Telus and BCE announcements changed the nature of the problem, and not just as a matter of size. The minister (after the new tax was announced) emphasized that there were also rumours of big financial corporations planning to convert; rumours of energy giant EnCana Corporation was planning to put its mature assets into an income trust. It would have been a $20-billion deal.


The creation of a phony crisis by a government can be a powerful tool to sell an excessively strong policy action. This technique is closely related to the more explicit appeal to fear among voters which has been a staple strategy of the Harper government (see Scott Feschuk,, Oct.14, 2010).

W.T. Stanbury is professor emeritus, University of British Columbia.

The Hill Times

Tuesday, August 9, 2011

WikiLeaks : US bid to "shore up" Harper from the day he was elected


Tuesday, June 07, 2011

WikiLeaks : US bid to "shore up" Harper from the day he was elected

An embassy cable written by US Ambassador David Wilkins the day the Cons were first elected in 2006 suggests Harper would be useful in advancing the US agenda for Canada and that giving him " a success story" like the softwood lumber deal would "shore up" his ability to stay in office without appearing to "sell out to the Americans".
It's pretty well a quid pro quo blueprint for every Canada-US initiative Harper has dutifully followed ever since.
Excerpted :

The election of a new government, after thirteen years of Liberal rule, presents opportunities for advancing U.S. interests in such areas as law enforcement and continental security, and in developing Canada as a more useful partner in the Hemisphere and around the globe.
Significantly, the socially liberal core values of the opposition are more in line with most Canadians than the minority Conservatives, weakening their mandate even further. Given a relatively weak mandate and tenuous hold on power, Harper will move deliberately but cautiously to get a few successes under his belt before doing anything even remotely bold.

Relations with the U.S. will be tricky for Harper, who along with many members of his caucus has an ideological and cultural affinity for America. But as he has done already with many of his core social and fiscal values, he will simply have to sideline this affinity in order to not be painted as "selling out to the Americans" to a skeptical Canadian public. I know Harper will be warm and cordial in his dealings with the U.S., but he also has to demonstrate that he has the ability to advance Canada's interests with Washington, and he may feel compelled to step back from gestures that could be construed as a close embrace.

That said, I see a real opportunity for us to advance our agenda with the new government. I recommend early on that we look for an opportunity to give Harper a bilateral success story by resolving an irritant such as the Devil's Lake filter system or entering into good faith negotiations to reach a solution on softwood lumber. Early success on a bilateral issue will bolster Harper and allow him to take a more pro-American position publicly without as much political risk.

Another area where the new government will seek engagement will undoubtedly be border security. Finding a few high-profile SPP-type deliverables to improve cross border movement of goods and services would help our image here as well as shore up Harper's credentials. Laying this groundwork would then open the way for progress on cross-border law enforcement initiatives of interest to us, such as enhanced information-sharing, joint maritime operations, and more robust counter-narcotics efforts.

Enhanced info sharing on Canadians, the shiprider program, the imported war on drugs.

On other issues, Harper is committed to increasing spending on the armed forces and will do so, making the Canadian Armed Forces a more capable and deployable force; we have little to contribute to this debate and should stay out of it. He has also suggested that the missile defense decision could be re-examined.

With regards to our transformational agenda, there will be numerous opportunities for engagement. However, I suggest quietly working such cooperation with the new government through official, non-public channels, and that we focus on a handful of priority areas -- keeping Canada in the game in Afghanistan as the mission turns more difficult and possibly more bloody; continuing to work together to keep the pressure on Iran; increasing support to the new government in Haiti, possibly even taking on more of a leadership role there.

And right about now I'm guessing you're remembering some of Harper's more bizarre outbursts on Iran, his caginess about withdrawing troops from Afghanistan, and Canada's new "leadership role in Haiti" where DFAIT is buying up property to house an infusion of Canadian officials.
Back to Wilkins' cable :

"We're going to be recommending senior level visits and consultations on foreign policy issues to help bring Harper and his new, generally inexperienced team into the fold as more useful partners.

I look forward to helping connect the dots with the new government so we can effectively advance our agenda."

Afghanistan, Iran, Haiti, enhanced information sharing, war on drugs, joint maritime operations, security perimeter ... There's also a section on Canada "engaging more actively in other hemispheric trouble spots such as Venezuela, Colombia, and Cuba."

Has Canada done anything independent of this cable under Harper?

David Emerson, who crossed the floor to the Cons to implement the soft wood lumber deal a week after he was elected as a Liberal in Vancouver, is mentioned in a second Wilkins cable just after the deal was signed with USTR Ambassador Susan Schwab eight months later.
Here they are quoted discussing International Traffic in Arms Regulations, a US law which proscribes Canadian dual nationals from some countries from work on the arms deals that comprise 40% of Canadian defense procurement from the US, and the Western Hemisphere Travel Initiative :

"It would be better, she continued, if we could look at issues as if there were a common border surrounding Canada and the U.S., rather than as an issue caused by the Canadian-U.S. border. Emerson agreed. He said that policies such as the WHTI are a "running sore" in the bilateral relationship and are inconsistent with policies to integrate the Canadian and U.S. economies to the maximum extent possible."

So, again, Steve, we ask : How's that US security perimeter deal with Barry coming along?
Posted by Alison at 5:18 AM
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Labels: Afghanistan, Canada-Colombia Free Trade Agreement, David Emerson, deep integration, Haiti, Harper, Obama, security perimeter, softwood lumber, SPP, WHTI, WikiLeaks, Wilkins

Wednesday, July 20, 2011

Is it possible that Flaherty doesn't have a clue?

Tax Changes Hurt Some REITS [July 20, 2011 2:20 PM]

Dennis Mitchell of Sentry Select Capital on BNN states:

"This is kind of the Department of Finance basically acknowledging that they really don't know what they're doing and they have no clue about how the capital markets work."

"...This is incompetence can't keep changing the rules, I am sure Jim Flaherty will say that he is giving the market clarity. If we keep getting clarity every six months nobody will be able to allocate capital properly."

See video clip here

Thursday, June 23, 2011

Eric Reguly on: Why doesn't Canada have more top companies?

My posted comment on the Eric Reguly artcile entitled: Why doesn't Canada have more top companies?:

Canada doesn't have more top companies for the simple fact that Canadian companies and CEOs do not know how to compete. Canadian companies and CEOs are coddled at every opportunity by the policies enacted by their closely held and controlled politicians. In the US they have the industrial military complex to worry about, Here we have the CEO-politician complex. What do you possibly think was behind the killing of income trusts, if not to destroy the competition that trusts represented for these coddled CEOs who sought to kill them as competition, (read: Gwynn Morgan, Dominic D'alessandro, Paul Desmarais Jr. etc etc) and which threatened the established order by the placing of shareholders' rights ahead of the greed driven CEOs?

What else did CEO lobbyist John Manley means when he said "you can't have two different structure for the same businesses" in arguing to kill the one structure that was in the best interests of the country, while preserving the one that is rife with abuses and bad for the country in the short, medium and long term?. Too bad dolts like Eric Reguly were too stupid to understand the game that was being played, and how he was being gamed by the CEOs to advance their world of coddled CEOs who are incapable of competing.....even in their own lousy back yard, let alone on a world stage.

Wake up Eric! You're so easily duped and manipulated, you could be a lazy non-competition engendering Canadian Politician like Jim Flaherty yourself some day too!

Why doesn't Canada have more top companies?

Globe and Mail
June 23, 2011

Aren’t we clever? Our Top 1000 lists more than 30 Canadian companies with profits of $1 billion or more in 2010, a remarkable achievement given the worldwide corporate bloodletting since the 2008 financial crisis. Most Canadians know the names of the biggies, from Royal Bank to Rogers Communications, and probably consider them money-spinning proof that we can compete with the best of the best.

When I look at the list, however, my heart sinks. I recognize every one of the top 100, but I can only spot three, maybe four, that: a) compete in the international big leagues, b) have a brand that is known outside Canada and c) are making news. They are: Research In Motion, Thomson Reuters, Bombardier and perhaps Royal Bank or Barrick Gold. A few years ago, I would have put Manulife among that group, but its image has waned in the post-Dominic D’Alessandro years.

Congrats to those four, even though each lacks the “cool” factor that has, for instance, made Apple a supernova. So why doesn’t Canada have more international corporate champions?

Some of the world’s smaller countries, by population, are home to global giants. Australia has BHP Billiton, Rio Tinto and Macquarie Group. Switzerland has Nestlé, Syngenta, Glencore, UBS, Novartis and Xstrata. The Netherlands has Shell, ING and Philips. Sweden has Volvo, Ericsson and Ikea.

There’s no paucity of excuses from Canada’s political right, middle or left for our poor global showing. Corporate tax rates are too high? They’re among the lowest in the Western world. There’s too much government coddling? There’s too little. Canada is too small? The Swiss wouldn’t buy that argument. Costs are high, and training and education are inadequate? CEOs can’t endure Canada’s winters? Celine Dion intolerance? Blah, blah and blah.

Here’s my reason: epic Canadian investor greed.

I’ve worked as a business journalist in four countries—Canada, the United States, Britain and Italy—and nowhere have I witnessed greed to rival Canadian greed. From 1997 to 2007, I felt all I did was chronicle the eradication of corporate Canada as investors, and CEOs who encouraged them, hit the sell button. Here are just a few of the companies I no longer write about: Inco, Falconbridge, Dofasco, Stelco, Algoma Steel, MacMillan-Bloedel, Molson, Alcan, Ipsco, Gulf Canada, Newbridge Networks, Poco Petroleums and Masonite.

The sellout continues. In February, the successful TMX Group agreed to sell itself to the inferior London Stock Exchange. The TMX should have been the buyer.

Last year, Potash Corp. of Saskatchewan almost became another hollowing-out victim. True, CEO Bill Doyle fought off BHP Billiton, but I don’t think he wanted to keep the world’s biggest fertilizer company in Canadian hands to generate local wealth and jobs. The share price wasn’t to his liking, and as things turned out, the takeover was blocked by the feds.

To be sure, each sellout is a special case. In a few takeovers, such as Falconbridge, the offering price was so huge that sellers would have been foolish not to take the loot and run. But others were just instances of plain, short-term greed. Canadian investors would rather take even a meagre payout today than stick with a company for years to create a world-beater.

Of course, short-termism isn’t uniquely Canadian, but patience often generates even bigger rewards. When Ralph Robins was CEO of Rolls-Royce in the 1990s, he earned no love from British investors and analysts by investing fortunes in jet-engine technology that wouldn’t pay off for years, if at all. But Sir Ralph refused to cave in to the gimme-returns-now mob. Today Rolls is one of the world’s top manufacturers and tech innovators.

That stick-to-it attitude is almost extinct in Canada. Evidence? How about the big push early in the last decade to turn corporate Canada into one monstrous, bloated income trust?

The income trust was a peculiar beast—discouraged or outlawed in many civilized countries—that avoided taxes by paying out almost all cash flow to unitholders. But that left little money for R&D, corporate development or overseas expansion. When Telus and BCE, Canada’s two largest phone companies, announced their intention to convert to trusts in 2006, Finance Minister Jim Flaherty did the right thing and shut down the party. Five years later, investors still moan about that.

In 2008, Don Argus, then-chairman of BHP Billiton, the world’s largest mining company, denounced Canada’s sellout culture. “Canada’s policies are a worst-case scenario,” he said. “Canada has lost more head offices than any other country. Canada has already been reduced to an industry branch office and is largely irrelevant on the global mining stage.”

Policies? I don’t know if there are any. For every buyer, there’s a seller. Canadians love to sell. Yes, we have many companies in safe, protected industries that are making billions in profits. Sadly, most of them are nonentities on the world stage.

Wednesday, June 22, 2011

Hunt for yield creates new risks: BoC

My posted comment to today's Financial Post article entitled: "Hunt for yield creates new risks: BoC":

Just another of the obvious "unintended consequences:" that CAITI (www, caiti, info) has been talking about since its inception in December 2006. Only took Mark Carney the better part of 5 years to realize the folly of his idiotic ill-conceived and ill-executed actions of killing income trusts ( on the totally false premises of alleged "tax leakage") and the certainty that his actions against yield hungry investors would spawn more Asset Backed Commercial Paper schemes or Manulife Income Plus near disasters to come to pass.

What a clueless idiot we have for Governor of the Bank of Goldman Sachs in the person of Mark Carnage.

Hunt for yield creates new risks: BoC

Barbara Shecter
Financial Post
Jun 22, 2011

The sort of low-interest-rate-driven risk taking that lead to the 2008 global financial crisis is on the rise and posing an increasing threat to the stability of Canada’s financial system, the Bank of Canada said Wednesday.

“The popularity of riskier securities and strategies is growing” both globally and in Canada, the central bank said in its bi-annual Financial System Review released Wednesday, highlighting the boom in lower-grade bonds that is drawing in new investors who may not be aware of the risks.

While stimulative monetary policy is needed to support the global economic recovery,” a long period of low interest rates may fuel excessive risk-taking,” the report said, noting that this risk to the system has increased since its most recent report in December.

The report highlighted the role of misunderstood investments — notably asset-backed commercial paper — in the most recent market meltdown a few years ago.

This “search for yield could cause risk to be underpriced or lead investors to take on exposures that they may not be able to manage” if the global economy falters, the stability report said.

In particular, Wednesday’s report points to the growing popularity of non-investment-grade bonds and the near historically low price of their credit risk relative to government bonds.

“It is uncertain whether all new investors have the ability to adequately manage the risks associated with these securities and investment strategies,” the report says.

The report also cited “covenant lite” loans that delay the pain of likely defaults, and complicated developments in exchange-traded funds in Europe.

Global economic issues including the high risks associated with sovereign debt continue to put pressure on financial stability, edging higher in the most recent period, according to the report which also urged “further moderation in the pace of debt accumulation” by Canadian households.

While economists at TD Bank do no expect interest rate hikes before 2013, that could change if other risks looming over the Canadian and Global landscape were to abate in the coming months. In such a scenario, “the Bank of Canada could very well start to lift rates before the year is up,” a TD report concluded.

The central bank also warned Wednesday that Canadian institutions could be put at a disadvantage in the global move to regulate derivatives, and made a strong case for a domestic solution to meet G20 commitments to stability-driven central clearing and settlement.

The bank, which is playing an active role in the country’s G20 commitments on the regulation of derivatives, highlighted risks of electing to have over-the-counter derivatives contracts cleared by central counterparties (CCPs) outside Canada.

“Global CCPs may not provide a level playing field to Canadian dealers that are smaller than the global dealers,” the report warned, adding that “offshore clearing may not provide the public sector with sufficient scope for oversight or control to mitigate and manager the effects of a financial crisis.”

Thursday, May 5, 2011

Has the entire NDP caucus decamped to Vegas?

PM Harper may call Parliament back 'mid-May,' but NDP MPs say it's too early

With 68 new MPs to swear in, the NDP needs time for training, establishing new offices, constituency offices, hiring and swearing in, among other issues.
Published May 4, 2011 5:49 PM
The Hill Times

[Back to work: NDP leader Jack Layton, pictured in the House in March. The government has not said when Parliament will return this spring.]
The Hill Times photograph by Jake Wright
Back to work: NDP leader Jack Layton, pictured in the House in March. The government has not said when Parliament will return this spring.

PARLIAMENT HILL—The first tussle between the new official opposition NDP and the majority Conservative government may be on the close horizon—not over legislation but timing of the new Parliamentary session.

NDP whip Yvon Godin (Acadie-Bathurst, N.B.) told The Hill Times on Wednesday he understood—apparently from something Prime Minister Stephen Harper (Calgary Southwest, Alta.) said—that the government may intend to call the 41st Parliament to begin sometime in mid-May.

With 68 new MPs to swear in, all but two of them newcomers to Parliament and some not even familiar with politics, let alone federal politics, the NDP needs time for training, establishing new offices, constituency offices, hiring and swearing in, among other issues.

“I think it’s too early,” said Mr. Godin. “The House is not on fire there. To be fair to the democracy, to be fair with the process, leave people to take breathe a little bit. I know what it is, when I got elected in 1997, you want to be fair to your constituents, you want to open an office, people are looking for you.”

But, though the official proclamation from Governor General David Johnston dissolving the last Parliament set May 30 as the date to “summon and call together” the new one, it can be changed at Mr. Harper’s direction. House Speaker Peter Milliken’s office said the pro forma date always set at the dissolution of a Parliament is usually changed by the prime minister following an election, and it can be pushed either back or ahead.

But, other than Mr. Harper’s statement that it will be “soon,” the Prime Minister’s office as of Wednesday said no decision had yet been made.

Andrew MacDougall, Mr. Harper’s press secretary, told The Hill Times in an email, “We will have a spring session. The budget will be front and centre in that session.”

The proclamation dissolving the last Parliament set May 23 as the final date for the return of all 308 election writs from ridings across Canada, but that was only the final deadline.

NDP MP Joe Comartin (Windsor-Tecumseh, Ont.) also acknowledged the New Democrats, with 56 of their rookie MPs from Quebec, have a formidable training period ahead of them, as the new caucus band engages Parliament Hill. Mr. Comartin said the party’s normal trainee programs are being expanded.

The first step, Mr. Godin told The Hill Times, is a caucus meeting by telephone on Thursday with the entire caucus, and a full caucus meeting likely sometime shortly before the new Parliament begins. The Liberals hold their first caucus meeting next week.

As Mr. Godin and other veteran MPs fended off criticism Wednesday about the inexperience of many of their new Quebec MPs, some of whom lived in Ottawa and were just names on ballots as far as their new constituents were concerned, the party also absorbed its first round of sniping from the Liberals, now occupying the third party range at the far end of the Commons where the NDP sat until now, for five decades.

Wayne Easter, the feisty Liberal MP from Prince Edward Island, told The Hill Times NDP Leader Jack Layton (Toronto Danforth, Ont.) might regret giving up his influential spot as leader of the third party in a minority Parliament—where he often wrested legislation or other measures from Liberal and Conservative governments—in exchange for opposition leader status where a majority government needs no support, in raw balance of power terms, to pass bills.

Mr. Easter said Mr. Layton is going to learn “you had a hell of a lot more power before this election as a third party than you do as the official opposition. All Stephen Harper needs to say to him is ‘Jack, what are you talking about man, I have 167 seats, I don’t need to talk to you.’”

Mr. Godin, NDP MP Pat Martin (Winnipeg Centre, Man.), and House Leader Libby Davies (Vancouver East, B.C.) brushed the Liberal poke off as “sour grapes.”

“The facts speak for themselves. The Conservatives have a majority so it’s obvious that if they want to jam something through, they’ve got the votes to do that,” said Ms. Davies. “What it does mean though is we will have to be creative, we will have to be tough in being the official opposition, and think of what we do in a variety of ways to keep accountability and transparency and keep pressure on the government.”

Ms. Davies said she feels “tremendous” about the new caucus, especially the young MPs who she said will “learn the ropes” quickly. “New Democrats, we’re political animals, we get into this fast. This is going to change so many things,” she said. “I think it’s a whole new ball game. It’s going to be a whole new kind of politics.”

The Hill Times

Wednesday, May 4, 2011

Mulcair: The Doubting Thomas

Here we have Thomas Mulciar, Deputy Leader of the NDP, doubting the existence of photos taken of the death of Osama bin Laden. This doubting attitude doesn't surprise me at all. The last time I spoke with Thomas Muclair back in 2010, we were discussing the income trust issue and I expressed an opinion derived from my 20 years working as an investment banker on Bay Street, to which Mulcair responded: "You were never an investment banker".

What? How do you respond to that? No Thomas, I am actually lying to you about my profession and impersonating an investment banker, just like Obama is hiding something about the Osama bin Laden event and lying about the existence of photos.

This Mulcair is nuts!

NDP MP Thomas Mulcair questions Bin Laden pictures

Daniel Kaszor May 4, 2011
By Sarah Boesveld and Sarah-Taissir Bencharif

The NDP got its first taste of the perils of prominence Wednesday after being forced to handle two public relations disasters as the newly elected Official Opposition.

While MP-elect Ruth Ellen Brosseau was scrutinized for allegedly filing falsified nomination papers in Quebec, deputy leader of the NDP, Thomas Mulcair, drew gasps when he said he does not believe the United States government has photographs of terrorist Osama bin Laden. He also hinted there may be “more going on,” behind the scenes of his assassination than the U.S. is making known.

“I don’t think, from what I’ve heard, that those pictures exist. And if they do, I’ll leave that up to the American military,” Mr. Mulcair said during an appearance on the CBC TV’s Power and Politics Wednesday.

Asked again whether he thinks the photos exist, Mr. Mulcair said: “No, I don’t think they do. If they’ve got pictures of a cadaver, there’s probably more going on than we suspect in what happened there.”

Twitter immediately flooded with comments about the statement, making the Outremont MP a trending topic on the micro-blogging website. “I almost fell out of my chair when Mulcair said he doubted the existence of Osama bin Laden photos,” tweeted Marc Garneau, the astronaut and Liberal MP for Westmount-Ville-Marie.

In a subsequent tweet, he admonished the deputy NDP leader’s comments. “Sanity check please: Osama bin Laden is dead and photos were taken. To suggest otherwise is a serious lack of judgment.”

Prime Minister Stephen Harper’s spokesman, Dimitri Soudas, said that the incoming Conservative government doesn’t share Mr. Mulcair’s skepticism. “The White House made it clear that pictures exist,” he wrote on Twitter. “Absolutely no reason to doubt that.”

The party scrambled to mount a response to questions over Mr. Mulcair’s statement. In a statement, Paul Dewar, the NDP foreign affairs critics, said the incoming opposition party didn’t question the existence of the photos.

“We have no reason to doubt the veracity of President Obama’s statement,” he said. “I understand that the U.S. government has photos, but decided not to release them as they do not want them used as trophies. This is a legitimate concern. We agree these types of photos shouldn’t be used as propaganda tools.”

Mr. Mulcair’s comments were quickly picked up by dozens of U.S. media outlets.

In the same Power and Politics interview, Mr. Mulcair also came to the defence of Ms. Brosseau, the successful Quebec NDP candidate in Berthier-Maskinongé, famous for vacationing in Vegas in the middle of the election campaign and for boasting less than stellar French skills though she now represents a largely francophone riding.

Trois-Rivieres resident Rene Young said he and his wife never signed Ms. Brosseau’s candidacy papers, although their names are clearly listed on the forms submitted to Elections Canada.

“The signature that is supposedly mine is not mine, and neither is my wife’s. There are two signatures on that form that are not us. We don’t understand how they are on that document that allows her to run for MP,” Mr. Young said in French from his home.

Defeated Liberal candidate Francine Gaudet suggested the NDP did not properly represent the nomination form to residents in the riding.

“We’ve found what could be irregularities,” she said in French. “Mr. Rene Young confirms that his wife’s signature on the nomination form is grafitti. So we’re expecting justice to be served in all this.”

While Ms. Gaudet said Elections Canada should investigate the issue, local Liberal riding president Louis-Victor Sylvestre said further action is necessary. “The only thing left for Ms. Brosseau to do is to step down,” he said. “You can’t get elected based on deceit.”

Conservative candidate Marie-Claude Godue told local media a byelection should be called. Ms. Brosseau swept the riding by 6,000 votes Monday night.

Anyone wishing to contest Ms. Brosseau’s candidacy must bring the complaint before the courts, in this case the Quebec Superior Court, said Elections Canada spokeswoman Diane Benson. As it stands, the race was legitimate and the result stands, she said, adding that all 100 signatures required of the candidate in order to be considered part of the race were approved by the returning officer in the local riding.

The NDP also defended the legitimacy of the papers, saying voters clearly knew who Ms. Brosseau was.

“These signatures were collected on a door-to-door basis; we have some of the neighbours from before, some of the neighbours from after, there could be no question that those were the signatures obtained by those people,” Mr. Mulcair said on Power and Politics. “I will make the following commitment to the people in Berthier-Maskinongé — they will have an MP who will be able to speak to them in fluent French before the end of this two-year term to make sure everything is done to provide full service to the riding.”

Ms. Brosseau, he said, is currently taking French classes.

Another spokesperson for the NDP said that signing the nomination form does not necessarily mean you support the candidate.

“A signature is not a vote,” said Karl Belanger, press secretary to NDP leader Jack Layton.

National Post, with files from Tamsin McMahon

NDP deputy leader Thomas Mulcair lit up the twitterverse with his comments casting doubt on the existince of U.S. photos of Osama bin Laden’s body. He quickly began trending on the social media site, which adopted the hashtag #thingsTomMulcairbelieves to unleash its outrage and sarcasm on the party’s most senior Quebec MP. Here is an exerpt of some of the reponses:

Dimitri Soudas, Prime Minister Stephen Harper’s spokesman:
PMOSoudas Dimitri Soudas @CBCPolitics the White House made it clear that pictures exist. Absolutely no reason to doubt that. #cdnpoli

Liberal MP Marc Garneau:
Marc Garneau Sanity check please: Osama Bin Laden is dead and photos were taken. To suggest otherwise is a serious lack of judgement

Conservative MP and Immigration Minister Jason Kenney:
Wonder if Mr. Mulcair has discussed his OBL pic doubts w/ Richard Bergeron, the 9/11 conspiracy theorist he endorsed to be Mayor of Montreal.

Edmonton-St. Albert Conservative MP Brent Rathgeber:
Brent RathgeberThomas Mulcair on Bin Laden photos shows how the NDP in Official Opposition constitutes amateur hour!

@wxwatcher66 Darren Ibsen
And in other news Thomas Mulcair Says there is no picture of the easter bunny the tooth fairy or little green men.

cherylfougere Cheryl Fougere
RT @CdnPolitico: Elvis, Princess Diana and Marilyn Monroe are alive and living in Detroit

@apaulgill Paul Gill
@@charliesheen Check out the #mulcair – this Canadian socialist is saying there was no pictures – comment on #bush not going to ground zero?!

@andrew_black Andrew Black
@maktiga Most would agree that, with so many rookies, we didn’t expect #mulcair to make the first big gaffe

Mira458 Stella Campbell
NDP Mulcair’s 1st interview. #fail

Posted in: Canada, Canadian Politics, Posted Ta

Alf Apps does a 180. Things must really be desperate!

In his letter, Mr. Apps also appealed for the party to be more inclusive through this renewal process and to “respect the honestly held viewpoints of each party member, including all in our deliberations.”

WOW, that really would be a change! Why don't I believe it?

Liberals urged to take stunning blow on the chin

OTTAWA— Globe and Mail Update
Published Wednesday, May. 04, 2011 5:51PM EDT

Calling their election defeat “a deeply personal experience,” Liberal Party president Alfred Apps is appealing to all Liberals now to put that behind them, regroup, assign no blame and begin the long process of rebuilding.

“Our future as a party will depend, more than ever, on preserving our unity, broadening our vision and keeping clear and cool heads over the coming weeks and months about what we need to do,” Mr. Apps wrote in a two-page letter to Liberals, released Wednesday.

Canada's Liberal Party leader Michael Ignatieff waves as he and his wife Zsuszanna Zsohar (R) leave after announcing his resignation as Liberal leader during a news conference in Toronto May 3, 2011. Ignatieff is leaving politics after losing his seat in Monday's federal election.

Many Liberals fear that the election result has now divided the country more sharply between left and right, leaving little room for a party of the centre.

But Mr. Apps is not giving up on Liberalism. He says it’s not “dead in Canada.”

“Far from it,” he wrote. “Our commitment as Liberals remains to a resolutely centrist political party, to a program that blends and balances fiscal responsibility with social compassion. … We must not now surrender to tired ideologies, whether of the right or left, in search of what can work in the real world to make the lives of Canadians better.”

The Toronto lawyer, who was one of the troika to travel to Cambridge, Mass., to encourage Michael Ignatieff to quit Harvard University to join the Liberal Party – with the idea of him eventually becoming leader – is now warning about falling into the trap of finding an easy fix.

“This is not the time for making rash judgments or speedy conclusions,” he said. “This is not the time for Liberals to be seduced by political expediency or parliamentary convenience.”

He said, too, it was not a time to point fingers or for hand-wringing. Rather, “we need to move forward to a reasonable period of constructive stability and collective reflection.”

Mr. Ignatieff announced his intention Tuesday to resign as Liberal leader after the disastrous outcome Monday that saw the party reduced to a mere 34 seats. Mr. Ignatieff lost his own seat in Toronto, where the once-mighty Liberal fortress there collapsed.

It was a humiliating loss.

Mr. Ignatieff’s announcement means yet another Liberal leadership convention; every election, it seems, there is a new Liberal leader. It will be the fourth since Paul Martin took over from Jean Chrétien in 2003.

Liberal caucus is to meet next week to decide on an interim leader; the national board of the party will have to decide on a date for a future convention – the earliest possible date would not be until next year.

In his letter, Mr. Apps also appealed for the party to be more inclusive through this renewal process and to “respect the honestly held viewpoints of each party member, including all in our deliberations.”

This is no time for the “faint-hearted,” he wrote, asking those who want to help to “dust” themselves off and commit to work.

Bev Oda's understudy

Rookie NDP MP-elect accused of falsifying nomination papers

by Sarah Boesveld and Sarah-Taissir Bencharif
National Post
May 4, 2011

Two days after her surprise win in the Quebec riding of Berthier-Maskinongé, NDP rookie Ruth Ellen Brosseau and her team are being accused of falsifying her nomination papers.

Liberal candidate Francine Gaudet, who came in a distant third after the Vegas-vacationing Ms. Brosseau scooped the riding by almost 6,000 votes, says two residents whose signatures appear on the nomination form deny signing anything that pledged their support for Ms. Brosseau.

Trois-Rivières resident René Young and his wife saw their names on the candidacy form but do not remember signing them, Ms. Gaudet said.

NDP party spokesperson Karl Bélanger said the allegations are “not true.”

“The signatures were collected legitimately by our campaign workers going door to door,” he said. The signatures — 100 are required for a legitimate run at office according to Elections Canada rules — were approved by the election’s returning officer, he added.

“Madame Brosseau is thankful to the people of Berthier-Maskinongé for supporting her and helping her get elected. All the signatures were collected legitimately and if some people don’t remember signing it, well, that will be for them to explain.”

Ms. Brosseau has been a controversial candidate ever since the media learned she spent part of the April’s campaign on vacation in Las Vegas. The single mother and, until recently, assistant manager of Oliver’s Pub on the Carleton University campus in Ottawa, has very poor French skills, the NDP admits. A local radio station interviewed Ms. Brosseau during the campaign (her only interview) but did not air it because she could not be understood in French.

Ms. Brosseau lives in Gatineau, Que., a long drive away from her riding. It is unclear whether she’s actually visited Berthier-Maskinongé.

Despite the NDP’s denial of any falsifications on the nomination forms, Ms. Gaudet said she will ask Elections Canada to investigate.

“We’ve informed our party’s legal advisors about this situation and we’ll see in the next hours what our next actions will be, based on Elections Canada’s response,” Ms. Gaudet said in French.

Elections Canada records show Ms. Brosseau was not originally chosen to run as the NDP candidate in the riding — Julie Demers won the nomination in Berthier-Maskinongé, but was moved to the riding of Bourassa where she ultimately lost against Liberal Denis Coderre.

National Post

Thought for the day: MPs as mere voting proxies

Image: Pierre-Luc Dusseault, a 19-year-old student of applied politics at the Universite de Sherbrooke, now becomes the youngest member of Parliament in Canadian history.

It really matters not that this newly minted NDP MP is 19 and a student enrolled at university, since our democracy has been degraded by the party system to the point where MPs aren't actually MPs in the true sense of the word. They are mere (voting) proxies that are voted in the hands of their party's leaders. In this case, any way that Jack and Mulcair want to vote this kid's proxy.

NDP's gang of rookies includes 4 McGill students, 19-year-old, Vegas visitor

By: Jonathan Montpetit and Andy Blatchford,
The Canadian Press

The new MPs, many who are political newbies, beat the odds and surprisingly won their ridings for the New Democrats in an unprecedented sweep for the party, mainly in Quebec. Top from left: Charmaine Borg (Terrebonne-Blainville) and Tyrone Benskin (Jeanne-Le Ber); bottom from left: Ruth Ellen Brosseau (Berthier-Maskinonge) and Matthew Dube (Chambly-Borduas).

The new MPs, many who are political newbies, beat the odds and surprisingly won their ridings for the New Democrats in an unprecedented sweep for the party, mainly in Quebec. Top from left: Charmaine Borg (Terrebonne-Blainville) and Tyrone Benskin (Jeanne-Le Ber); bottom from left: Ruth Ellen Brosseau (Berthier-Maskinonge) and Matthew Dube (Chambly-Borduas). (POSTMEDIA NEWS)

MONTREAL - The NDP caucus from Quebec is an eclectic bunch, to say the least.

It includes the youngest-ever MP, four McGill University students, an ex-Liberal MP, and a globe-trotting diplomat who unseated Gilles Duceppe in his own riding.

Oh, yeah, and the karate-instructing, federal policy researcher who chopped Foreign Affairs Minister Lawrence Cannon down to size.

That doesn't even include a woman whose questionable French and campaign vacation to Las Vegas raised doubts about the worthiness of the party's Quebec team.

Thomas Mulcair, the party's Quebec lieutenant, sought to reassure Quebecers on Tuesday about the quality of the 58 NDP MPs the province elected the night before.

Mulcair was surrounded at a news conference by several of the MPs, but noticeably absent was Ruth Ellen Brosseau, the assistant manager of a bar in Ottawa who won a comfortable victory in Berthier-Maskinonge. The riding is 98 per cent francophone.

"Ms. Brosseau does not speak a French at a level we would expect for a riding like Berthier-Maskinonge," Mulcair said.

"But I am making a personal promise, we will help organize her office, we will give her all the help that's needed."

Mulcair guaranteed Brosseau's French would improve dramatically over the next four years.

"We will ensure that if ever there are things that need to be taken over by the party, or by me personally, I will be there," he added.

Brosseau has been invisible in the last few weeks as the media try to contact her to assess her French and talk to her about her trip to Sin City.

The NDP said Brosseau, who returned from Vegas last week, wasn't in the riding on election day and wouldn't immediately be available for interviews.

She won with a very healthy 6,000 majority over the riding's Bloc incumbent.

Quebecers woke up Tuesday to a radically altered political landscape, one dominated by rookie NDP MPs instead of the usual Bloc Quebecois veterans.

The NDP's startling rise was best summed up in Tuesday's headline on the website of McGill University's daily newspaper: Four McGill Students Elected to Parliament.

Another university student, a 19-year-old from Sherbrooke, Que., was not only voting in his first election but also became the youngest person ever elected to Canada's House of Commons.

Pierre-Luc Dusseault is a self-described political junkie who has been to Ottawa and visited the House of Commons. He also admits to watching a lot of CPAC, the TV channel that broadcasts parliamentary proceedings.

"I know the game," said a confident-sounding Dusseault, who turns 20 on May 31.

Many of the neophytes admitted to having low expectations when the writ was dropped.

Yet they were among dozens of unlikely Quebec NDP candidates who won Monday as the party's caucus in the province skyrocketed to 58 from one. Many will bring impressive backgrounds into Parliament.

The Quebec caucus will also feature Romeo Saganash, former deputy grand chief of the Grand Council of the Crees; Francoise Boivin, an ex-Liberal MP; and Helene Laverdiere, who was posted for the Department of Foreign Affairs in Washington, Senegal and Chile.

Laverdiere earned some of the loudest cheers at the NDP rally Monday night when TV screens flashed that she had knocked off Duceppe in Montreal's Laurier-Sainte-Marie.

She seemed stunned to have pulled off the upset, but admitted she had an inkling it could happen.

"A month ago it was a dream," she said.

"(Then), a few weeks ago seeing how people were listening to what we had to say, we started to think, 'Well, maybe the dream will come true.' "

Other new faces will include Mathieu Ravignat, a volunteer karate teacher who knocked off Cannon in Pontiac.

Tyrone Benskin, another surprise NDP winner, said he was asked all night Monday about the impact of so many fresh faces in the House of Commons.

"Yes, there are newcomers, there are always newcomers to any party," said Benskin, 52, a veteran actor, director and musician.

"All these people are very good at what they did in their private lives and they're bringing that experience."

In Toronto on Tuesday, NDP Leader Jack Layton was peppered with media questions about his inexperienced team.

"Yes, we have some young people," he replied. "But you know young people got involved in this election in an unprecedented way. I think it was very exciting.

"And the fact that some of these young people have now been chosen . . . I think we should see that as something to celebrate — not something to criticize."

Benskin himself was singled out during the campaign by Duceppe for not being at ease in French.

Other new faces, like MP Alexandre Boulerice of Rosemont-La-Petite-Patrie, couldn't believe what had happened.

"Am I surprised? Of course," said the elated father of four shortly after beating Bloc incumbent Bernard Bigras.

"This is not a wave, this is a tsunami — a political earthquake."

Boulerice, a communications adviser for the Quebec division of the Canadian Union of Public Employees, lost to Bigras by more than 17,000 votes in the 2008 election.

This campaign started off much the same way as 2008 for him, as people told him on the street he was a nice guy who would never win.

That was until Easter weekend, when families talked politics, he said.

In the last two weeks of the campaign, he was flooded with emails from supporters asking how they could help, where they could get a sign for their balcony and how they could get themselves an NDP button.

The buttons disappeared so fast that Boulerice didn't even have one to wear for election night.

"Because every time we had a button on, people were asking, "Can I have it?' " Boulerice said.

"So (there's) a back order on buttons."