The DAILY DIGEST: INFORMATION and OPINION from ST. JOHN’S to VICTORIA.Harper denies breaking election pledgeFlaherty says Toronto market meltdown "anticipated"
Commitment was to protect seniors' income, PM tells Commons
O Canada, Are You Out of Your Mind?
Plunge in trust values renews takeover talk
Bank of Canada says trust plan to boost efficiency
BCE put gun to Ottawa's head
Board believed if trust plan killed, Telus would die too
Income-trust crackdown: The inside story
When the telephone rang, Flaherty knew he had to act
Tories acted, fearing new GST cut was in peril
Good policy, bad politics
Flaherty fix killed a gimmick
Market carnage: Who won, who lost
Trust sector down $19B: BCE and Telus hit, dividend-paying stocks did just fine
Some winners out of Flaherty's bombshell
'Sell Canada' new mantra on Wall St.
Oilpatch target for foreign takeovers
Canada alone in tolerating trusts
They're treated as corporations in most other Western countries
Advisors rush to advise on trust revolution
Reconversions to corporations are possible
Telus disputes timing of tax change
'Not a level playing field'
Trust reversal betrays promise
Feds move to end income trust tax 'avoidance'
"Black Wednesday" fallout to hit PM
Politicians and analysts agree with the move but say sudden announcement hurt market
Seniors come to grips with financial blow
Income trust tax angers Alberta oil patch: Calgary lawyer
PM defends going back on promise
Canaccord lambastes trust plan
Shock and anger, sense of betrayal in the oil patch
Angry seniors feel betrayed
Reality forced Harper's hand
Income trust dangers real
Move protects nation's tax base
Flaherty finally did the right thing
Parties share blame for letting tax loophole develop into a disaster
Seniors shell-shocked by income trust tax notice
Tax flip-flop 'grossly unfair'
Telus suffers $3b battering
Telus forced to rethink its plans to convert
Turning the telecom into an income trust would have been tax neutral at worst, CEO says
Didn't vow 'no taxes for Telus,' PM says
Tories keeping pledge to protect seniors, he insists, as market falls after income-trust tax bombshell
Broken trust: Energy trusts clobbered
'There's a lot of resentment in Calgary'
Trusts' pain will be Canada's gain
OTTAWA CITIZEN - The necessity of immigration
OTTAWA CITIZEN - The cost of a cruller
OTTAWA SUN - Trustworthy move
TORONTO STAR - Flaherty correct to close loophole
TORONTO STAR - Meaningless target
NATIONAL POST - The Conservatives' bait and switch
HAMILTON SPECTATOR - Prentice antics petty politics
K-W RECORD - Income trusts, political trusts
WINDSOR STAR - Rae reborn: The role of taxation
SASKATOON STARPHOENIX - Cellucci's view strengthens Northern claim
REGINA LEADER-POST - Flaherty had to take action
CALGARY HERALD - NATO's moment of truth
CALGARY SUN - Core crackdown
GRANDE PRAIRIE DAILY HERALD TRIBUNE - Protecting privacy
In a very public global village, Canada is doing OK
EDMONTON JOURNAL - Sensible move on income trusts
EDMONTON SUN - Honks with heart!
LETHBRIDGE HERALD - Doing nothing will cost the world dearly
VANCOUVER SUN - Conservatives' flip-flop puts the onus on income trusts to act fast
VANCOUVER PROVINCE - Ottawa shows shocking disregard for investors
VICTORIA TIMES-COLONIST - Back to business, please
VICTORIA TIMES-COLONIST - Clamping down on income trusts
'Get off your butt'
Chief cuts a path out of the aboriginal wilderness
Ottawa's land-claims view spurs tension with Ontario
Afghan success vs. Taliban seen hanging on reform
Stretched UK military faces staffing shortage: report
The Canadian Forces can’t keep track of whom it is sending into combat in Afghanistan, a revelation the military’s ombudsman said today is disappointing.
Montreal grocery store reverses eviction of poppy-distributing war vet
Veterans call on Ottawa for better post-mission care for soldiers
How not to go to Afghanistan
Soldiers bring home serious emotional problems
Election could throw U.S.-Canada relations into tailspin
Integration little threat
Albertans loath to let upgraders go south
Poll finds little support for bitumen exports to U.S., but much misunderstanding as well
Power to the people (in suits)
How a whole new kind of business lobby is a threat to democracy
Retirees get a post-Halloween tax treat
New income splitting provision is a big benefit for seniors
Income-splitting provision 'significant,' analysts say
After 60 years, Japan seems ready to take its place in the world
Rewriting constitution would be the first step for nation to rediscover itself
Don't lecture us on rights, Canada told
UN countries with records of abuse fire right back
HEALTH CARE RELATED
Health spending plateaus, study finds
5.7% increase slightly lower than previous year
Dual-citizenship tax possible, MacKay says
Palestinian refugees from Iraq heading for Canada
U.S. lets aliens loose in Canada
Immigrant system needs overhaul: Sgro
Backlog now standing at 800,000
India tops the list with the most applicants
Tories plan to reopen same-sex marriage debate
A vision for a more competitive Canada Michael Ignatieff
Infecting Canada with the usual germ
Foes 'gut' bill: Toews
Says opposition parties soft on crime
PM caves on Clean Air Act
Opposition parties vow to 'clean the Clean Air Act'(Comment5)
As critics await chance to amend bill, controversy erupts over research awards
Canadians victims of 'bait and switch' in Tory income trust plan: Ignatieff
Opposition asks prime minister to apologize for flip on income trusts
Conservatives continue to dominate political fundraising in Q3 of 2006
Harper heeds Quebec ministers' complaints on better communication: sources
Senators grill their colleagues over Dubai trip
Election promise looms large
Tories skewered over reversal
But NDP, Bloc will support tax move
`Matter of national importance' — Flaherty defends tax move
Says lack of action would have cost Ottawa $1B a year Finds sympathetic ear in Ontario's finance minister
Standing exposed on opposite corners
Challenger jet minister's only choice, aide says
No suitable commercial flight available for Jim Prentice's trip to Washington
Feds flip-flop on cost of using government jets
Harper focuses on pleasing core supporters
POLITICS - US
Play it again, Uncle Sam?
Put wheat on farm ballot
"The minister should end, once and for all, the uncertainty that is negatively affecting farmers, customers and employees,"
Day still pressing to abolish gun registry, but can't pinpoint cost savings
Cost of arming guards, beefing up border security could hit $1 billion, says Day
Income-splitting genie out of bottle
Tell me everything
Stern warning rings hollow
Stern: Alarmist and incompetent
Canada defends securing Arar confession from Syria
OPINION AND INFORMATION
Court no place for kids
Aloha, General Rick
The sound of patriotism, with a twang
Will Clean Air bill be reworked?
Anti-smoking bullies have gone far enough in their regulatory jihad
Wheat board needs to develop a backbone
Spin class, part two: How Stephen Harper beat the press gallery
Corruption et impatience
Nouvel appui pour Stéphane Dion
Québec se fait attendre
BCE a été l'élément déclencheur
Fiducies de revenu - Lendemain de veille sur les marchés
Les conservateurs amassent des millions
Registre des armes à feu: Ottawa est inflexible
Harper exigera la révision du protocole de Kyoto
Le renforcement de la sécurité aux frontières pourrait coûter 1 milliard $
McGuinty: Ottawa doit s'occuper de toutes les revendications autochtones
Conservatives criticized for byelection attack plan
BELOW(30)(30)(30)(30)(30)30)(30)(30)(30)(30)(30)30)(30)(30)(30)(30)(30)30)(30)(30)(30)(30)(30)(30)(30)(30)30)(30)(30)(30)(30)30)(30)(30)30)(30)(30)(30)(30)30)(30OBSERVATIONS RELATING TO THE INCOME TRUST IMBROGLIOHaving been a debtor all my life I've never mastered the intricacies of investing. This much I believe is accurate, correct me where I err.
". . . the party promised only to protect the incomes of Canada's seniors, not the profits of major Canadian corporations and foreign investors."
Few of Canada's seniors have income trusts for themselves. Most have shares in companies or in mutual funds that have shares in companies. At least some of these shares are in "major Canadian corporations" whose profits serve to provide them with retirement income. Weakening the profitability of these corporations weakens "the incomes of Canadian seniors". Right or wrong.
Some articles suggest the Liberals were perhaps, maybe, going to act a year ago or so but were scared off by the attacks of the then Opposition Leader. An OP ED piece in the National Post was a part of the "Stand Up For " campaign.
It was on the Conservative Party of Canada website but is presently only available through googling as far as I can determine because when I "Click here for the current page without highlighting. " nothing comes up.
If you're of a mind read the article ion the Post. You'll find it refers to seniors, yes, but also mentions investors undefined and companies as well that were being protected
Rubie sent me an article by an American investment counsellor. If he's correct and matters stand as they are to-day the answer to the title of his article
"O Canada, Are You Out of Your Mind?" http://www.changewave.com/freecontent/2006/11/freetobymain20061102.html will be "YES!"
As I said, this isn't one of my fields of knowledgeability so please correct me where I've erred.
Subject: DD CWBSticking to promises through stacking the deckActivity relating to the Canadian Wheat Board is still my top focus (income trusts are concerns of investors of
which I am not one).
Appoint a commission of "Get rid of it" supporters, forbid the CWB leadership from arguing its virtues, terminate
a Board member supporting it a year early - and earn the praise of Americans!
Sticking by promises and principles is primary The means are incidental.
Joe--as an Easterner you have no concept of what the CWB is. If it is so wonderful why are not Eastern farmers clamouring to join it? If it gives Western farmers and advantage in marketing you would think the Eastern farmer would want it expanded to include them.
The concept of an individual not having control of their product is communistic. The concept that Big Government has control of your product for sale is an irritant to many Western farmers.
No one is asking the question --why should a grain grower be forced to belong to the CWB? That is the crux of the problem. If the CWB is so wonderful and gets the best price for grain, you would think everyone would be happy. As it is though, the CWB books are closed so no one knows what is really happening. Two years ago farmers were notified that they would not be getting their last payment from the CWB because there was no money left. How many producers of anything would put up with that?
In spite of the rhetoric from Liberals, NDP and BLOC, no one is getting rid of the CWB, they are just making it voluntary. No one forbade the CWB leadership from defending their place at the trough--they were refused from using CWB funds for that argument. I didn't hear any argument from anyone when the supposed 'vote' a few years ago included dead farmers, farmers that had not grown grain for years, some living in Florida, etc.
All I ask of you is to remember the Western grain farmer in leg irons for donating a bushel of his own grain to an American 4H member relative. He lost all his farm equipment to the CWB. Remember the farmers that wanted to set up a pasta flour mill--CWB refused to allow them to use their own grain--they would have had to sell it to the CWB first and then buy it back at inflated prices, thus making the enterprise unviable. The CWB prefers to sell the grain to the Americans and then consumers buy back the finished product. Don't forget that Western Canada grows the best pasta wheat in the world!
Eastern farmers are in something of the same boat regarding the quota system--remember the egg producer who lost his whole flock because he sold some eggs that had not gone through the government grading station. Quota system is almost as bad, but not quite. I think an egg producer can have 200 chickens and not belong to the EMB, but 201 and he is forced to join! Eastern farmers should figure out that they are not as free as they think they are and start rebelling against government intervention in their business.
Depending on Big Government to know your business better than you do is a fools game, and the only winners are the government. You would think that most of us would have learned that by now!
Why should individuals be forced to belong?
. . . as an Easterner I'll leave argumentation pro and con to the value of the CWB to you and other Westerners. The political aspects are a different kettle of fish. Arguing the necessity of keeping an election promise holds no water. Rather than honouring promises to the softwood lumber industry the opposite direction was taken, the Commision was hand picked to get the desired result rather than a balanced view and a pro-CWB director cashiered a year before his term was up. "All's fair" is the saying. Get power and use it the pattern - but with these actions goes any claim to acting in a more virtuous manner than predecessors .
Subject: Re: Suing Canada?
As one of the Canadian population represented by a Government that is acting according to their intelligence and ability to make a difference in Canada, I would ask that you kindly take your ideas, carry them to the middle of one of the multitude of oceans covering the planet and there dispose of them. Leave our/my Government to make the decisions pertaining to our/my homeland.
I resent even the thought that you are actually moving against taxpayers of your own country; you say you are, but I wonder if indeed you are representing your country and not some foreign organization bent on destroying what this effective Government has accomplished thus far. I would ask where and how you got the name, information about, and contact with this German expert, but I am not asking - I will let the future speak for itself.
Frankly, I am disgusted that you call yourselves " Friends of the Earth," and particularly Canada, yet are ready to place another burden on the shoulders of Canadians. No, I do not believe that you are acting in the best interests of this country, or even of the planet, and one of these days your real agenda will come to light. I am a senior, but I hope I'm here to see that day!
(Ms) Rosalie Piccioni
STRATOSThe longer this continues without answers makes one believe that the current MP`s in our Canadian Federal Government are irrelevant!
- Yow, well argued. And at length, too. I'll answer this tomorrow. And to think that I thought that I was being sarcastic, not ironic ...===================================
Did "Canada" initiate a tax scam under Brian Mulroney
Did the "US" subsidize Canada thru "Brian Mulroney" with a North American Union direction.
With both the National Press in Canada and Federal Government officials unwilling to respond
there appears only to be one conclusion. There is a power above both that really
does direct what happens to Canada. Canadian citizens as a norm are no more
than pawns in our current business environment.
For six years questions and comments have been posed to both the National Press in Canada and
Federal Government officials with no answers.
re; stacking the deck in the Agministers office.
One day, I got a chance to call the Agriculture Minister's office and was passed on to the a fellow from the office of the person who is responsible for the Wheat Board. Imagine my surprise to be given one Randy Kovacs, who spoke muchly about how badly the Canadian Wheat Board needs to be closed down! This was in the Wheat Board's office!
When I told him that the main instigators or lobbyists to get rid of the CWB are Cargill and Midland Archer Daniels, among the biggest foodcorps in the U.S. and how they were among the foodcorps that profited muchly from Canada's BSE scare, when the border was closed to Canadian beef, since they bought up the Canadian meat packers having expanded into Canada, and could gain by buying our beef at bargain prices he seem to thing that was a non-issue. Even when I said that that was the reason OUR, CANADIAN, meat prices stayed high all through the boycott!
When some of the largest and greediest corporations on earth want to eliminate a highly organized, Canadian united front against just such greed and uncontrolled corporatism as the food cartels, would we not have to be total fools to drop our pants, or other defences, liKe the CWB, at this time?
Considering the huge size of these foodcorps, it's almost funny, but horrendous, that they can put their own people into our ministries or think tanks to say that the Canadian Wheat Board is too large a monopoly and must be eliminated or brought down to size!
This is not the first time this particular ploy has been used, however. Remember when talk started about breaking up Ontario Hydro and such quite huge entities as Southern Electric and Enron's lobbyists were getting Canadians to say that Ontario Hydro was getting to big, and how uncontrolLable Hydro was and how terrible the 38 billion dollar debt was? Then remember the Enron disaster and the figures involved?
Either corporate America and their pro-corporate lobbyist are losing touch with reality or they think Canadians are a pack of fools, just because some of our politicians and industry leaders really are.
Think Corporate Magna Carta, now!
Rene Moreau (416-489-8347)
===================================O Canada, Are You Out of Your Mind?LEAVE IT ALONE OR LOSE IT
Sure, take on the operating businesses that are only converting to the income trust structure because your bonehead laws forced them to, but leave the energy trust industry alone.
Or you won't have a "Canadian Energy Income Trust" business.
I talked to a number of private equity guys this week and I can assure you of one thing: We'd love your energy trust business in the United States. If this form of capitalism is too aggressive for you, we will buy it -- for CASH.
We will buy it and move the domicile of the trusts to the U.S., kick out the Canadian investors who depend on their monthly income and continue what the pioneers of the industry started and YOU killed.
Imagine ... $300 billion of private equity and $1 trillion or more of bank lending firepower is undoubtedly drooling over the idea of buying these energy trusts from you today.
If you go ahead with this plan, I will personally guarantee that I will organize the first buyout --it will be a piece of cake. And if the Canadian government meddles with these takeovers, it will cost your country BILLIONS in lost revenue and duties.
Take a deep breath, close your eyes and remember that over 85% of ALL your exports from your lovely country go to the United States.
Canada's economy is half the size of California's -- we could buy the energy trust industry over lunch. Canada, you have the great fortune of having incredible energy and mineral resources -- if we knew they were so valuable in the 18th century, we would've made you an offer you couldn't have refused then.
But Minister Flaherty, you're just looking out for the best interests of Canada, right? Grow up.
If you choose to kill the geese that lay the golden eggs, the most energy-deprived country in the world will roll up your industry, assume ownership, and pick up and grow the industry that you so irrationally seem to want to throw away.
That is, if we beat the Chinese and Russians to it. The good news is the energy trust guys I know don't wanna work with the Chinese or Russians. They LOVE Americans and REAL capitalism
Government acted with 'integrity' on trust issue: PM
Fair enough. But without forethought during the previous election, it seems. Either that, or he took a risk while hoping that he was right in doing so. Ya takes your winnings, but ya pays the price.
Battle for 'Net neutrality' arrives in Canada and could forever alter Internet
Yow! My first impression is to keep the Net neutral but I'll be looking to know more. Stay tuned ...
- Phyllis Wagg
- In my opinion the termination of income trusts was something the government had to do. Maybe this is the first reality check for this government on the nature of corporate power and economic fundamentalism. Corporations moving to the income trust model were not looking at the viability of the business but at tax avoidance. The most extreme economic fundamentalists believe that corporations should pay no tax. That means they believe that ordinary taxpayers should subsidize corporate profit by paying for all those things that government provides corporations.
- Since constant economic growth is a central objective of economic fundamentalism, the transformation of a corporation to an income trust undermines the ability of that corporation to grow and maintain its infrastructure. Already some companies have been forced to use their assets to cover the payouts to their investors. This meant that the capital rather than the profit was being used to meet their obligations. With the two largest communications companies moving to this model we could eventually suffer a major breakdown in our communications networks apart from the tax implications.
- There are many Canadians who have seen their net worth decline, especially those who invested in stock that was over-valued because of the income trust fad. It is unfortunate that governments allowed this issue to progress to the point it did.
- Phew! Am I glad that I sold my RioCan a month ago (purely coincidental .. I have no ins on anything of this sort and I'm not interested in getting any). I'd bought RioCan in 1999 at $9.40 and sold $22-something, I think, plus distributions so I did OK. Sorry for others who got stuck holding the bag, though. That being said ...
- Indeed, the trusts were more valuable when their distributions (dividends) were exempt from corporate tax, since the trusts would then only have to pay corporate tax on what had either bent spent on administration (e.g. salaries, supplies, rent, etc.) and "extra" cash / assets / whatever accumulated during the year. In effect, the trusts were able to distribute more cash than if they were to be corporate-taxed since the more they'd distribute, the less they'd be taxed.
- Slapping taxes on the trusts lowers their value. Said value can be calculated in various ways, one of which consists of taking expected future returns, discounting them using a certain "annual discount rate", and adding them all up. What you get is the total present-day value of the trust, which you then divide by the total number of "units" (shares) to get the value per unit.
- Figuring out expected future returns and discount rates are the work of specialists but there are statistical tools out there that can give a more-or-less precise idea of what to expect. Their results are less precise for long-term projections, of course, so more conservative estimates are made when dealing with the long term, especially as concerns discount rates.
- So, what's a discount rate in this case? In brief, it's what the market will be looking for in terms of annual percentage-return on investment. That rate is made up of three components: the base rate (the rate offered by the Bank of Canada for Treasury Bonds whose maturity / payout is similar to the length of the time period for which the discount rate is used, i.e. for 20 years, a 20-25 year TB is appropriate); a market-rate risk component (based on to what degree the price of the trust's units/shares varies as its trust-sector (e.g. real estate) varies - the more it varies, that is the more it rises and falls as the real-estate trust market rises and falls, the greater the market-rate risk component); and a time-based risk component (based on it being riskier to invest long term than short-term, since it's hard to predict what will happen in the long term). These rates are expressed as percentages. So, the lowest discount rates will correspond to short-term predictions matched with low TB rates and low-volatility trust units. In the opposite case, the highest rates will correspond to high TB rates (else, if total trust-unit rates are too low, why not play it safe and buy TBs?) coupled with long-term predictions for high-volatility trust units (i.e which means, in terms of high volatility, for trusts that do better than others when things are good and do worse when things are bad).
- Now that we know how to come up with a sensible discount rate (that is, if I've explained myself clearly enough), how do we use them? That's actually pretty easy:
- - take the quantity of money that you'd like to invest right now;
- - take what you expect will be distributed to you (paid to you as a dividend) during the upcoming year; divide that by (1 + DR); where DR = discount rate;
- - take what you expect to be paid the second year; divide that by (1 + DR) squared;
- - for the third year, divide by (1 + DR) cubed;
- - and so on for a number of years;
- - then take what you expect will be the final worth of your investment, calculated in future dollars; divide by (1 + DR) to the power of the number of forecast years;
- - add these all up, except for the original investment which you subtract; if the result is positive, the investment has positive value and is expected to be profitable to you; if negative, it won't be profitable and you should best invest where you can get a return that better matches anticipated risk (better rates for higher risk, lower rates for safer betrs).
- For the above, what you'd really be doing is taking income from each future year and converting it to current dollars. So, pay out the original investment (hence its "negative" value), add up future income calculated every year in current dollars, and add the final / leftover value of your investment (calculated in current dollars) to that. If the incomes and the final value are greater than the original investment, their value will be greater than the value of the original investment FOR A GIVEN DISCOUNT RATE. That is, over the period projected, the investment will return MORE THAN the discount rate every year, on average. In the opposite case, the investment will yield LESS than the desired rate of return and is thus not worth making.
- Phew! Lots of reading, but interesting for those curious about this kind of stuff (I hope). Hope you enjoyed it!
- Norman Dundas
- The provinces still lose and the feds gain a tax grab.
- Hhhmmm ... let's see how that works out ...
- On the positive side, for a given trust, provinces WILL have four years to adjust, if they choose to do so. And the feds will pretty much have to compensate the provinces in some way.
- Stephen Berg
- Hello from Winnipeg. I am writing to ask Canadians to do everything you can to save the Canadian Wheat Board from its summary execution at the hands of the Conservative Party, Prime Minister Stephen Harper, and MPs Chuck Strahl and David Anderson.
- I've got to admit that I'd like more info on why we should scrap the Board and how it's to be done. If the Board were to be scrapped, are there better ways for farmers to stabilize their incomes, which is what the Board was initially all about? (Prices for commodities can rise and plunge wildly from year to year ... not exactly soothing for a farmer, who may find himself getting 50% less (or worse) than the previous year for his crop).
- Plus, what about the segregation function of the Board? Many don't know this but the Board performs a big service in keeping different types of wheat (and whatever) in different silos, etc., making it possible to sell specific types of wheat to customers looking for that. (For example, pasta makers use durum ("hard") wheat as opposed to softer/pastier kinds to make their flour, so as to avoid making mushy pasta). This is a big deal because most others (the Americans!) do no such thing and are thus unable to charge premiums for unblended wheats. (When buying wheat in the States, I understand, you're buying generic "wheat", not durum or other "pure" types). So who, if anyone will segregate the types?
- That being said, segregation aside, consumers seem to be the obvious winners in the CWB's disbanding since the latter won't be able to get sell wheat at higher prices by timing its sales. But there may well be circumstances that make this "benefit" a questionable one, for all I know.
- At the international level, Canada might get dinged with a lowered trade surplus (or higher deficit) since the CWB would no longer charge higher prices for Canadian wheat to international buyers. At present, Canada, through the CWB, has a fair bit of price-making power on the international stage since it accounts for 20-25% (unless that's changed over the past years) of wheat traded worldwide. (The last time I looked, I saw figures along the lines of Canada producing 6% of wheat worldwide, with our low population meaning that we end up selling most of it, which accounts for 22% of international wheat trade. For example, the Americans raise more wheat than we do. But they eat more than they produce, I believe).
- So ... keeping the CWB alive might very well be the right thing to do, on balance. Or it might not be. Personally, I'd like to hear more about the merits and demerits of both cases, with facts and figures to back up the arguments.
- Stephen Berg
- Fran s Dion
- Hello Joe,
- I would like to wish the best to the Progressive Party of Canada (Progressive Canadian) candidate, Steve Hunter in London North Centre By-election.
- Je souhaites la meilleure des chances a Steve Hunter, candidat du Parti Progressiste du Canada (Parti progressiste-canadien) dans London Nord Centre.
- FRANCOIS DION
- LOUIS H ERT. QUEBEC
- Yes, Sir! Still alive, Fran s? Long time no see, mon ami ...
- Rene Moreau
- Subject: Re: Daily Digest October 31, 2006
- To Joe
- From Rene Moreau (416-489-8347)
- Regarding the post I find Stratos statement here ironic. by Phyllis Wagg about corporate domination attempts.
- One is reminded of a tale about how to catch a tiger without any struggle.
- 'Coat the net with molasses before catching the tiger. When he ends up in the sticky net he will spend so much time trying to clean himself that he'll be no trouble for you.'
- Wahahahahaha. Thanks, Rene. I'll remember that one ....
- Just as an example, say someone is really good at detecting the ploys of corporate entities to privatize the different aspects of the power industry, finding out what they do and how they do it. For instance, how the Ontario Power Authority was put in place, after telling people they are a government body, by corporate entities to advise the government to get the taxpayers to pay for the 20 to 40 billion dollars needed to upgrade and add to the nuclear power supply, and then they will lobby for privatization of the power system, which means turning all that we the taxpayers, paid for, to foreign,corporate control and profit making, since NAFTA says 'thou shalt NOT discriminate against foreign, American corporations' just as we are realizing the need for a LEASH on corporations! They then will call for 'Smart Regulation' which, in reality, means 'No Regulation!
- Actually, the whole point was to get private investors to build needed capacity, with the lure being decent-enough prices (when electricity would run short) inducing investors to build capacity as it was needed. With electricity prices being too low in Ontario (because they were regulated to those levels, which were much lower than the cost of bringing "new" electricity to market, that is building new capacity), consumers were consuming electricity much more than they would if electricity prices were determined by the market (that is, set at their "true" value). Higher prices would mean lower consumption, which would lead to LESS capacity having to be added to feed consumers hooked on cheap electricity (they'd be motivated to use their electricity better and in lower quantity, partly by substituting to other power sources such as natural gas and solar for heating).
- One of the prerequisites of a successful liberalization was the availability of SURPLUS generation capacity, which would induce domestic producers to sell at competitive prices. The thing is, though, the numbskulls who set up the market liberalization (hello, Ontario PCs ...) didn't take expect (or take into account) a whole whack of nuclear capacity going offline a few months after the liberalization. Producers would jack up their prices (almost) as high as they pleased. But the Ontario government got cold feet when prices started to rise, so it capped electricity rates (at 4.3 cents per KW-hr, I recall) and paid the difference between real and capped rates to the producers. In other words, the Ontario government was taking a HUGE hit when prices were high because production couldn't meet demand. So, on top of all this, some parts of Ontario (all in Toronto and area?) were hot with rotating blackouts, which weere forced upon them.
- So, did the then-government muff the liberalization? Oooh, yes it did. Or it sure mistimed it. To be fair, Ontario's nuclear generators DID need lots of repairs, which took much longer than expected to do. But those repairs were the result of (expensive) maintenance having been neglected so much during the 90s, when there had been a recession, and when the NDP, followed by the provincial PCs, ran the show.===================================
Thursday, November 02, 2006
Daily Digest November 2, 2006
Joe Hueglin wrote:
Posted by Seasoned Traveller at 12:43 PM