Brain Dead?

Richard Cohen writes this morning that Herman Cain's endorsement of Newt Gingrich is proof positive that the Grand Old Party is brain dead: 

It’s hard to know who is the more ridiculous figure — the grandiloquent, bombastic and compulsively dishonest Gingrich, or the beguilingly ignorant Cain, a man who has never held elective office and who was reduced to speechlessness when asked a question about Libya. Nonetheless, Gingrich, his Alfred E. Neuman grin on his face, accepted the endorsement and then went on with his nihilistic campaign for the White House. This has been an exceedingly silly political season.

In fact, the Republicans have become the silly party, precisely because they cannot accept the concept of nuance:

If you ask me what I think of abortion, I’d say, “It depends.” It depends on whether you’re talking about the ninth month of pregnancy, the first, the health of the mother, the fetus — or, even, the morning-after pill. But in the Republican contest, the answer to the question is always the same: no, no and no again. Thanks for giving the matter such careful thought.

It is the same with taxes. Should they be raised? It depends. It depends on economic and fiscal conditions — and on whose taxes will be raised and by how much. The answer cannot be “No, never.” That’s not an economic position; it is an ideological one and exhibits a closed mind.

And so it is with all issues -- global warming, the Iranian nuclear problem, relations with China. The answers are all simple. The problem is that the world isn't. And the Republican Establishment -- if it still exists -- has not had the courage to bring this to the party's the attention. For too long, Cohen writes, the movers and shakers in the party have

been mute in the face of a belligerent anti-intellectualism, pretending that knowledge and experience do not matter and that Washington is a condition and not a mere city.

They are now reaping the harvest of their neglect.

This entry is cross posted at The Moderate Voice.

Canada's Newt Gingrich

Susan Delacourt writes this morning that when the Liberals made budget cuts in 1995, they sold their program by using fear -- fear that we were about to hit a debt wall, fear that our children would be left to clean up the mess we had made. Now, she writes, the Harper government is whipping up public anger:

Now, 17 years later, I'm intrigued by how fear has been largely replaced by anger. When we cast around looking for where the cuts are coming, we look at where the government and its allies have been  trying to whip  up scorn and  rage: the CBC, the public service, generous pensions, unions, provinces, (certain) foreigners, and pretty much anyone who is seen to be standing in the way of Conservative dreams of prosperity.

The same scenario is being played out south of the border by Newt Gingrich. He gives voice to angry white men who like to think that they are undeprivileged. But its clear that the money which backs Gingrich does not come from Mom and Pop. The privileged -- particularly Sheldon Adelson -- are intent on keeping their privileges.

And so it is with Stephen Harper. He speaks for -- and whips up the anger of -- those who have benefited from the very policies which almost sent us over the cliff in 2008. When he speaks of "transformation," he speaks for more of the same -- the concentration of wealth and power in fewer and fewer hands. Anyone who opposes his vision is "an enemy of Canada."

It's strange that the man who claims he is the friend of the private sector and who last held a private sector job as a teenager -- which he obtained by relying on his father's connections -- should resort to a strategy which would never work in the private sector. Delacourt writes:

It's interesting -- this is something that probably couldn't work in the private sector. (And probably shouldn't.) When downsizing cuts are made  in this realm, our bosses have to go to some lengths to prove that the job losses weren't the result of a grudge or personal antipathy. Funny how when it comes to government, or at least this government, we simply assume that those being cut are going to get cut down first in the eyes of the public.

Harper, like Gingrich, is a demagogue. Bob Rae is right. They deserve each other.

Seizing Expediency

The cuts Stephen Harper wants to make to Old Age Security are driven by ideology, not necessity. Consider the Public Appointments Commission and the Employment Insurance Financing Board. Both departments were set up by the Conservatives. And, although both agencies are on record as having nothing to do, the government intends to keep them going.

Neither agency has been part of the government's review of spending. Yet Harper claims that -- while such zombie departments can be tolerated -- the Old Age Security program is "unsustainable." That claim, Tom Walkom writes in the Toronto Star, is pure Harperian balderdash:

True, the government predicts that the cost of pensions for the elderly, now about $35.6 billion, will triple by 2030. That sounds dire. In fact it means that the pension bill will grow by about 5.6 per cent a year during the period.

And when baby boomers start to die off, as they will from about 2020, spending on the elderly will start to decelerate on its own.

Harper claims that he is merely saving Canada from the kinds of problems which Europe is facing. But his diagnosis of the cause of those problems -- an out of control welfare state -- is simply wrong. Walkom writes:

In fact, the European debt crisis is far more complex. Spain and Ireland, which do not offer generous social programs, are in trouble. Germany, which does, is not.

Arguably, the real root cause of the crisis was the decision by countries with vastly different economies to use a common currency, the euro — a decision that encouraged too much public and private borrowing during the good times and makes repayment now near impossible.

The truth is that Stephen Harper will cut what he doesn't like -- not what doesn't work. The man who insists he's the smartest guy in the room is really not a very bright fellow. Still,  he has proved in the past that he has a talent for seizing expediency.

Making It Easy

Susan Riley wrote in the Ottawa Citizen yesterday that  federal politics these days is truly baffling:

It is hard to decide what is more astonishing: Prime Minister Stephen Harper's inconsistencies and course corrections, or the fact they have done no serious damage to his standing in the polls.

For a man who claims to offer no surprises, Stephen Harper has been remarkably inconsistent:

He accused critics of wanting to "cut and run" in Afghanistan, but, after nearly a decade of futile struggle, conceded the war was unwinnable and began withdrawing Canadian forces. He was never going to downplay China's human rights abuses in the name of the "almighty dollar" - until it became useful, recently, to ardently court China as a customer for tarsands oil.

There were other surprises: Mulroney-style Senate appointments, the unsavoury Chuck Cadman affair, the creative use of G8 funding to help Tony Clement secure re-election, the inexcusable defence of an EI watchdog agency that has done no work, has no immediate work to do, yet has already cost the treasury $3.3 million, with no end in sight.

And then there was that promise to be accountable to Canadians, which certainly didn't square with the government's concerted attempt to destroy information -- as in the case of the long gun registry or the long census form -- or simply attempting to keep information under wraps -- as in the case of documents relating to the treatment of Afghan prisoners.

In the end, Riley wrote, Stephen Harper's lack of charisma has put many Canadians to sleep, while others have simply given up:

They turn their back on politics, don't bother to vote, even imagine it is fashionable to remain aloof.

They claim all politicians are the same, but they aren't. They claim it doesn't matter which party holds power, but it does.

If Occupiers had simply voted en masse in May, we wouldn't have a majority Conservative government today.

Stephen Harper is firmly ensconced in Ottawa and now lectures Canadians  and Europeans on how they should run their economies -- even though the decisions which benefited Canada were made by others.

And he does so, even though a clear majority of Canadians didn't vote for him. As long as that majority remains divided, they will make it easy for Stephen Harper to succeed.

Full Of Himself

On the same day that the Globe and Mail reported on Stephen Harper's "grand plan to reshape Canada," and on Tony Clement's announcement that the "budget axe could cut deeper, sooner," Jeffrey Simpson wrote that,  "In the first five years of the Harper government, the number of information officers in the federal government grew by 16 per cent, to 4,459 from 3,855."

The growth in the number of information officers is curious. For the Harper government has been all about releasing less information, not more of it. The truth is that the Conservatives are obsessed with information -- or more specifically, the control of information. Simpson writes:

Everyone with even the slightest acquaintance of this government knows of its mania for information control. Although information officers have grown in number throughout the government, all messaging (down to the finest details) is controlled in the Prime Minister’s Office and the Privy Council Office, where, predictably, the number of people working on information has also grown.

Despite their emphasis on information control, however, the Harperites got their signals crossed. While Clement ensured his audience that neither Canada Pension nor Old Age Security payments would be cut, Harper was telling his audience in Davos that Old Age Security was unsustainable. This is still the gang that can't shoot straight.

This is the government which says it is dedicated to small government, while it adds non functioning departments .Greg Weston reports this morning on yet another Conservative initiated agency which has nothing to do.  One might get the impression that the prime minister doesn't know what he's talking about.

Nevertheless, at the World Economics Forum, Harper lectured European governments on their penchant for initiating services for which they refuse to pay. Strangely enough, the Europeans aren't buying what our prime minister says. They know what every Canadian should know by now:  Stephen Harper is full of himself.

Lots of Pictures

This week's summit between First Nations chiefs and the Prime Minister played out according to Stephen Harper tightly scripted wishes. It was all pictures, good wishes and no substance. Harper works very hard to stage manage his appearances; and this summit was supremely stage managed. There was no mention of the fact that, six years ago, the prime minister tore up the Kelowna Accord.

But, for a government that is on record as not paying attention to statistics, there are a few which should be on every Canadian's mind:

• More than half of the First Nation population in Canada is under 23.
 • The aboriginal birth rate is double that of many regions of Canada.
 • Sixty-one per cent of First Nation adults aged 20-24 have not completed high school, compared with 13 per cent of non-aboriginal Canadians.
 • The unemployment rate for First Nation peoples living on-reserve is 25 per cent, three times the rate for non-aboriginal Canadians.

There is rebellion brewing. The government has been warned that an Aboriginal Spring is around the corner.

Years ago, I sat in on a meeting of African American kids from ghettos in the southern United States. It was 1969, a year after Martin Luther King's assassination, and American cities were burning. I was one of a group of white middle class kids who were getting a taste of what life was like for the kids we only saw on television.

One of us said to a young lady who was vocal, but not hostile, "There are 22 million of you and 180 million of the other guys -- and they have more guns than you do."

"I'd rather die standin' up," she said, "than on my knees."

If people get desperate enough, all hell can break lose. Mr. Harper is sitting on top of a volcano. The pictures from that eruption will not be carefully stage managed.

Money Means Free Speech?

In this morning's Globe and Mail, Gerry Nicholls takes on critics of the recent National Citizens Coalition ad attacking Bob Rae. He complains that our laws:

impose severe legal restrictions on how much money citizens or independent groups can spend on “political advertising” during federal elections.

According to the law, “political advertising” includes any ads that support or oppose a political party or candidate or which simply take a stand on any issue that might be associated with any political party or candidate.

In short, it’s a gag law that makes it virtually impossible for unions, environmental groups, church organizations, taxpayer advocates or any group or individual to effectively or freely express political opinions at election time – the most crucial period of any democracy.

Nicholls' position is essentially a carbon copy of the argument made by Citizens United in the United States. That argument -- upheld by the Supreme Court -- is that money is the equivalent of free speech; and any attempt to limit the amount of money directed towards political advertising is an attempt to limit free speech.

The consequences of that decision were readily apparent during the recent presidential primary in South Carolina. E. J. Dionne of  the Washington Post wrote:

You cannot watch the morning news shows in South Carolina without confronting an intricately confusing blitz of ads, some paid for by candidates, others by the supposedly independent PACs. One kind is indistinguishable from the other.

Nicholls would turn Canadian airwaves into a northern version of those in the Palmetto State. For him, there is no question of fairness. He is not worried about what happens when those who have the most money possess the biggest megaphone:

The point is, the political consequences of the ad should be irrelevant. Nor should it matter that the ad is negative. All that does matter is that the NCC, and indeed all Canadians, should have the right to engage in the political process through advertising, even if thin-skinned politicians don’t like it.

Mr. Nicholls misses what has become the central problem in Canada and the United States: Money has corrupted our politics.

Would Ike Be A Republican Today?

As Mitt Romney and Newt Gingrich tear away at each other -- claiming that each benefited mightily from the government they both claim to despise  -- Lawrence Martin reminds his readers that there used to be a Republican president who consciously sought a middle way:

Dwight Eisenhower, Martin writes,

didn’t become a Republican until 1952, the year he campaigned for the presidency. He had never been schooled on political partisanship. “My only appeal to you,” he said during the campaign, “my only appeal to America … is to place loyalty to the country above loyalty to a political party.” He forbade his staff to issue personal attacks against opponents. He was dismayed by the primal political instincts of his vice-president, Richard Nixon.

In the end, Eisenhower did not have much praise for Nixon. When asked to name an important decision Nixon had participated in, Eisenhower responded, "If you give me a week I might think of one." Given what happened during Nixon's presidency, historians may one day write that Eisenhower's greatest contribution to his country was keeping Nixon away from the levers of power.

But, most importantly, Ike understood the limits of military power. He kept U.S. troops out of Suez and Vietnam. And he warned his fellow citizens of the dangers of the military-industrial complex. The man who led the D-Day invasion told Americans:

Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and not clothed. This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. This is not a way of life at all in any true sense. Under the cloud of threatening war, it is humanity hanging from a cross of iron.

Republicans have come a long way since Ike's day.  One doubts that he would recognize his party, let alone vote for it. He'd probably call himself an independent -- which is what he was before he became president.

This entry is cross posted at The Moderate Voice.

Stephen Harper's Wooden Head

"Learning from experience," the American historian Barbara Tuchman wrote, "is a faculty almost never practised."  The truth of that claim is readily apparent in Canada. In fact, Stephen Harper is the incarnation of Tuchman's axiom.

In a report for the Centre For Policy Alternatives, David MacDonald examines three possible scenarios for government belt tightening. Unlike the Liberals in the early nineties, who travelled the country explaining how their budget cuts were going to be administered, the Conservative budget cuts are shrouded in secrecy.


But regardless of which scenario the government finally decides to follow, MacDonald estimates that some 60,000 public and private sector jobs will be lost -- with Ottawa and the Atlantic provinces being hit the hardest:

“Depending on the scenario, the national capital region could be hit hard — losing over 22,000 positions — followed by Atlantic Canada with its already high unemployment.”

The Harperites are intent on cutting jobs as the Canadian economy shows signs of slowing. Austerity is the only way forward for the Conservatives, who are -- by Tuchman's definition -- the epitome of wooden headedness:

It consists [Tuchman wrote] in assessing a situation in terms of preconceived fixed notions while ignoring or rejecting any contrary signs. It is acting according to wish while not allowing oneself to be deflected by the facts.

The Harperites have never based policy on facts. They have never started from the premise that you deal with the world as it is. They have always begun from their own ideal of the world as it should be. And, from their perspective, the world would be much better off with much less government. If that makes the world less fair, more violent, more poverty stricken -- well, that's the kind of collateral damage that people will have to live with.

When I was a child wooden headed puppets were very popular among the younger set. We called them dummies.

Labour In The Crosshairs

The day before thousands of people gathered in London to support Electro-Motive's locked out workers, Jim Stanford wrote in the Globe and Mail that labour is facing a brave new world:

In the current bargaining environment, companies (especially multinational firms) hold the best cards. And executives are increasingly willing to precipitate their own work stoppages – through management lockouts – to enforce demands for lower wages and benefits.

A recession -- particularly this one -- always puts management in the catbird seat. High unemployment gives workers few options.  That's where government could play a crucial role. In 1935 -- in the middle of the Great Depression -- the Roosevelt administration passed the Wagner Act, which gave workers something they had never had before -- the right to organize. It also set up the National Labour Relations Board to act as a mediator in labour disputes.

The Harper government, of course, has gone in exactly the opposite direction -- as  its response to both the Canada Post and Air Canada strikes makes crystal clear. And it has been absolutely silent about the situation at Electro-Motive. Selling oil is on its radar. Canadian manufacturing jobs aren't.

There is a clear agenda behind the government's response. And the results, writes Stanford, will not be good for the Canadian economy:

This trend is troubling, for macroeconomic as well as ethical reasons. As employers ratchet down compensation, income shifts from consumers (who spend every penny) to corporations (which sit on a growing pile of uninvested cash). That undermines aggregate spending and weakens the recovery. And the more employers succeed in driving down wages, the greater the danger of setting off a cycle of deflation in wages and prices (such as the one that bedevilled Japan for a decade).

The prime minister claims to be an economist. But that claim -- like so may of the other things he has said -- does not stand up to scrutiny.

Blowing Hot Hair

Tom Walkom has a way of pricking the hot air balloons which the Harper Conservatives keep trying to launch. In today's Toronto Star, he writes that Canada's current international swagger is firmly rooted in hot air:

It depends on one commodity and one country. The commodity is oil; the country is China.

Right now both are going gangbusters. The Chinese economy surges along. That surge keeps the price of oil at its current, near-stratospheric, level. This, in turn, makes oil producers rich and keeps the rest of the Canadian economy above water.

Recent history should remind us all that what goes up can fall quickly to earth. The simple truth that what soars into the stratosphere -- like so much space junk -- eventually crashes.

The National Energy Board estimates that the price of crude oil, now roughly $100 a barrel, will have to stay in at least the $90 range if new tar sands projects are to be profitable. Yet no one worries.

The reigning assumption seems to be that the price of oil will never, ever, significantly go down again — that there will be no new technological advances that might allow existing reserves to be exploited more efficiently.

Given history, it is a heroic assumption.

As for China's roaring economy, Canada needs only cast an eye towards its closest neighbour to take a cautionary lesson. Japan, too, provides all high flying countries with  a warning:

Who can forget the Japanese miracle? It was the way of the future. Just as Harper today makes pilgrimages to China, former prime minister Brian Mulroney voyaged to Tokyo to see the new wonders and sell Canadian energy.

In biz-speak, phrases like “quality circles” were the rage. Japanophilia even hit the pop charts: “That’s why I’m turning Japanese/I think I’m turning Japanese/I really think so,” crooned the Vapors in 1980.

Yet the miracle eventually ended. The Japanese economy crashed in the 1990s and has never fully bounced back. No one talks about quality circles any more.

Yet the Harper Conservatives continue to strut about the world stage, blowing hot air -- no lessons learned.

About Those Capital Gains Taxes

Mitt Romney has so far refused to release information on his taxes. There is a good reason why he hasn't. If those documents see the light of day, it will become immediately apparent that Romney is a poster child for precisely what is wrong with the American economy.

Paul Krugman writes that you don't have to go back thirty years to see what has happened. The last twenty years provides plenty of evidence to support the notion that the game is rigged:

Since 1992, the I.R.S. has been releasing income and tax data for the 400 highest-income filers. In 2008, the most recent year available, these filers paid only 18.1 percent of their income in federal income taxes; in 2007, they paid only 16.6 percent. When you bear in mind that the rich pay little either in payroll taxes or in state and local taxes — major burdens on middle-class families — this implies that the top 400 filers faced lower taxes than many ordinary workers.

The main reason the rich pay so little is that most of their income takes the form of capital gains, which are taxed at a maximum rate of 15 percent, far below the maximum on wages and salaries. So the question is whether capital gains — three-quarters of which go to the top 1 percent of the income distribution — warrant such special treatment.

The problem with such special treatment is that it acts like a vacuum cleaner, sucking all the wealth to the top of the economic pyramid.  The bottom eventually collapses, bringing down the whole house of cards -- and leaving in its wake the Great Depression and the Great Recession.

Some argue that special treatment of capital gains creates jobs. The argument that Romney's Republican opponents are making is that it destroys jobs, while creating profits for investors. But they can't have it both ways. And that is the bind they are in.

This entry is cross posted at The Moderate Voice.

So Much For Republican Populism

When the Tea Party surged to the polls two years ago, some commentators saw a right wing populist movement taking control of the Republican Party. But E.J. Dionne writes this morning that the race for the Republican presidential nomination proves what has been the case for a long time -- big money is in the driver's seat:

The power of big money has been amplified in this campaign by the super PACs let loose by the Supreme Court’s Citizens United decision and lax regulation.

You cannot watch the morning news shows in South Carolina without confronting an intricately confusing blitz of ads, some paid for by candidates, others by the supposedly independent PACs. One kind is indistinguishable from the other.

What is different about his year's campaign is that Republicans are breaking Ronald Reagan's eleventh commandment : Never speak ill of a fellow Republican:

Rick Perry’s backers take on both Newt Gingrich and Rick Santorum. Ron Paul assails Gingrich and Santorum, too. Romney’s supporters have piled on with ads against Gingrich. Gingrich flicks aside Santorum and Perry with faint praise in his speeches, as he did at an event here on Tuesday night, maintaining that “the only effective vote to stop Mitt Romney is Newt Gingrich.”

The end result is that the Republican Party in 2012 looks distinctly unsavoury. They seem bent on their own destruction. Unlike the man they idolize, none of the candidates project a sunny disposition. There is no Republican populist movement.  It is no longer "Morning in America."

The Passsive Investor

Daniel Veniez argues that, under Stephen Harper, Ottawa has become a "passive investor" in the provinces. Harper's view of the Canadian Constitution is that of a Biblical fundamentalist -- the words in the BNA  Act are immutable. The problem is that recent governments have paid too little attention to chapter and verse. He argues that, in 1867, John A. Macdonald and his associates favoured a highly decentralized federation.

Yet that is a curious argument. Veniez points out that:

The Fathers of Confederation designed a constitution where the federal government was the lead government. Our first Prime Minister, Conservative Sir John A. Macdonald, believed that a strong and dominant national government was vital to developing a sense of shared nationhood.

Stephen Harper's Conservatives forget that Canada was born in the wake of the American Civil War. Macdonald was adamant that the kind of fracturing which had occured in the United States not occur here.

Harper lacks Macdoanld's national vision. In fact, his politics are closer to Alexander Mackenzie's than Macdoanld's. Mackenzie believed that a national railroad which crossed the Rockies was simply inefficient. He suggested that the route meet American railways further south and then turn north to Vancouver. Macdonald argued that the railway was about national unity, not just economic efficiency.

Canada's health care system is the 21st century equivalent of the CPR. To Stephen Harper, it is an accounting problem. There are consequences to Harper's view of Confederation. Veniez writes:

Strengthening the spinal cord of the nation requires leaders – in Ottawa and the provinces – that believe this is important. The consequence of ignoring the real power of a cohesive national action on various fronts is a more fragmented and dispersed federation than ever before. One need look no further than the skirmishes and cleavages on everything from energy and climate change policy to health care, securities regulation and immigration, just to name a few.

Stephen Harper would preside over the dissolution of Canada  --  if it meant turning a profit.

The Myth Of The Reluctant Politician

We all yearn for a modern day Cincinatus, who -- so the story goes -- left his quiet life on the farm to serve Rome. In truth, Cincinatus was a Roman aristocrat who, because of political reverses, had been exiled there until circumstances allowed him to return.

Lawrence Martin argues that political parties are at their best in the hands of career politicians, be they John A. Macdonald, Wilfred Laurier, Mackenzie King or Stephen Harper. It is for that reason, he writes in this morning's Globe and Mail, that the Liberal Party is in good hands:

What Liberals are encouraged about is not new policy but the fact that the party is now in the hands of a seasoned political pro, one who has demonstrated a surefootedness that has been absent under the three previous leaders.

There are those who will strenuously disagree with Martin. Many of them are card carrying Liberals. But, for the present, it's hard to argue with Martin's assertion that:

For Liberals, the experience and professionalism Mr. Rae brings are what is needed at this time. With an election four years away, policy can wait. The one big issue he emphasized in his closing convention speech was income inequality. He sees this as a good prong with which to attack the Conservatives’ economic record.

The Conservatives assume that income inequality is a natural state of affairs.They do not see that it is their Achilles Heel. If Mr. Rae's political acumen can clear the way for a clear shot at such an obvious political weakness, the Liberals have a future.

Several commentators have opined that this weekend was a blast from the past. We shall see. Martin writes that:

The message from Bob Rae was that the Grits are and will remain the non-ideological party, the party of the pragmatic centre where reason allegedly triumphs over gut prejudices of the left or right.

If the new prime directive in Canadian politics is that gut prejudice trumps reason, then we are, indeed, in deep trouble. Those who operate on that principle should be exiled to their farms.

The Rebuttal

Roy Romanow and his associates have penned a must read rebuttal to the Conservative government's new vision of healthcare. In today's Globe and Mail, they write:

Successful nations are built on unifying infrastructure. Think railways and the Trans-Canada Highway, seamless telecommunications networks, the armed forces, regulatory and judicial processes. Health care is a level up in importance because health is a fundamental precondition for full participation in society.

The last part of the last sentence bears repeating -- health is a fundamental precondition for full participation in society. It should be obvious by now that Conservative success depends on decreasing citizen participation. In every federal election in which Stephen Harper has run, voter participation has shrunk. The fewer citizens who vote, the more Stephen Harper will succeed. The Conservatives know this; and they work hard to make it so.

But Romanow and his confreres point to what should be another obvious fact -- Harper and Company, all claims to the contrary, are economically dense. Romanow and his associates insist that, "A high performing nationwide public health system contributes enormously to the economy."

Businesses don’t have to design and fund complex health plans for their employees. Workers don’t have to worry that taking a job in another province will compromise their health care. Only leadership from Ottawa can guarantee a common set of programs and standards and ensure that program enhancements are available to all Canadians.

Now Mr. Harper proposes to wash his hands of medicare and simply write cheques. In his six years as prime minister, he has never held a first ministers conference. There are some who hail this "executive federalism" as the wave of the future. The truth is that a meeting would mean that Mr. Harper would have to face his opposition; and -- as he has proven in the past  -- he would rather prorogue it than face it.

Perhaps that's because opposition rebuttals show up the prime minister for the shallow, shrivelled leader he is.

Math Challenged

Minister of Finance Jim Flaherty announced recently that his government is going to get serious about cutting costs:

"This is hard work," he said. "And of course, there can be numbers between five and 10 per cent and some departments can do more than 10 per cent."

As part of that cost cutting exercise, the government plans to reduce the number of Service Canada offices from 120 to 20. As offices and staff have been reduced, the result has been a  two month delay in issuing unemployment cheques to 1.4 million Canadians.

In the wake of this news, Carol Goar writes that tax breaks account for a sizable portion of the cost of government. The government has decreed that information on those tax breaks is not to see the light of day:

But over the years, frustrated public officials — a former auditor general (1986), a researcher in the parliamentary library (2006) and Canada’s parliamentary budget officer Kevin Page (last June) — have disregarded this directive, seeking to provide Canadians with a rough idea how much is going out the back door.

In that tradition, here is the value of all the tax expenditures in the 2011 report, released this week: $152 billion.

To put that in perspective, the government’s total program spending in 2011 amounted to $248 billion.

And, as anyone who has followed Stephen Harper's progress knows, the number of tax breaks has been growing. Goar enumerates some of them:

Here is a sample: the children’s fitness tax credit, the children’s arts tax credit, the universal child care benefit, the public transit tax credit, the first-time homebuyers’ tax credit, the volunteer firefighters tax credit, the working income tax benefit, the family caregivers tax credit, plus two sheltered-savings vehicles, registered disability savings plans and the tax-free savings accounts.

Yet, by accounting sleight of hand, none of those breaks show up as costs. It's an old trick. George W. Bush kept the cost of two wars off the books for eight years.

Those of us who remember Mr. Flaherty's tenure as Minister of Finance for Ontario know that he has great difficulty balancing the books. But, in truth, the call isn't his. It's Stephen Harper's. And Harper -- for more than a decade -- has been selling the notion that he is an economist.

Both gentlemen are math challenged.

Presidents and Busineesmen

Mitt Romney, whose reported net worth is somewhere north of $200 million, argues that he knows how to make all Americans wealthier.  In what is perhaps the deepest irony of this presidential season, Newt Gingrich echoes William Jennings Bryan -- who declared, "No one can earn a million dollars honestly."

Paul Krugman has attacked Romney's honesty in earlier columns. But on Friday, he dissected Romney's argument that, because he is a successful businessman, he knows how the economy works:

But there’s a deeper problem in the whole notion that what this nation needs is a successful businessman as president: America is not, in fact, a corporation. Making good economic policy isn’t at all like maximizing corporate profits. And businessmen — even great businessmen — do not, in general, have any special insights into what it takes to achieve economic recovery.

The solution to America's problems is not simply to increase corporate profits. That's a notion that those who have gained from globalization love to repeat. They have done well by slashing costs. However,

Consider what happens when a business engages in ruthless cost-cutting. From the point of view of the firm’s owners (though not its workers), the more costs that are cut, the better. Any dollars taken off the cost side of the balance sheet are added to the bottom line.

But the story is very different when a government slashes spending in the face of a depressed economy. Look at Greece, Spain, and Ireland, all of which have adopted harsh austerity policies. In each case, unemployment soared, because cuts in government spending mainly hit domestic producers. And, in each case, the reduction in budget deficits was much less than expected, because tax receipts fell as output and employment collapsed. 

During his tenure at Bain Capital, Romney and his partners purchased 77 companies. 22% of those businesses were shuttered. But Bain made money even when firms went belly up. Romney has said that, by the same logic, he would have let GM and Chrysler fail.  Besides the jobs at both companies, the multiplier jobs -- at auto parts plants, tire plants, steel companies -- would have also gone down the tubes.

Romney succeeded because of a narrow focus on profits. Countries are about more than making profits. Krugman reminds his readers that the last two presidents who claimed to be businessmen -- George W. Bush and Herbert Hoover -- left shipwrecks behind them.


This entry is cross posted at The Moderate Voice.

Lise St. Denis

The New Democrats are understandably furious at Lise St. Denis. But, as Chantal Hebert points out, her decision was hardly self serving:

Lise St-Denis could easily have continued to collect her pay as the MP for Saint-Maurice—Champlain on the NDP benches for the foreseeable future. Battling cancer at 71, the retired teacher could have bided her time before quietly going home. That would have been the path of least resistance.

The truth is that -- having been abandoned by the Conservatives, mortified by the Liberals and isolated by the Bloc Quebecois -- Quebecers parked their votes with the New Democrats in the last election. True, Quebec politics have been left of center for a long time; and the NDP platform was a good fit. But more than anything else, Quebecers voted for Jack Layton.

Many Canadians had forgotten -- or simply did not know -- that, despite all his time on Toronto City Council, Jack Layton was a native son, who moved as effortlessly between French and English as Pierre Trudeau and Brian Mulroney did before him.

On top of all that, St. Denis occupies Jean Chretien's old seat, which the old fox occupied -- except for a brief hiatus -- for nearly forty years. If she has had her ear to the ground, she knows that her constituents are not rock solid Dippers.

It's beginning to look like the Liberals and the New Democrats are preparing for an ugly battle in Quebec. That would be a mistake for both parties. Hebert correctly notes that:

The problem is that precious few Quebecers signed up for a fight to the finish between the Liberals and the NDP or for a left-wing crusade last May. More than a third of the party’s 2011 supporters voted for Jean Chrétien in 2000. A significant number are poised to vote for the new right-of-centre Coalition Avenir Québec in the next provincial election.

It was Layton’s ecumenical approach to politics that drew so many Quebec voters to the NDP. Based on his 2008 advocacy of a governing arrangement with the Liberals, he seemed best placed to reach out of the partisan box and build a progressive coalition sturdy enough to take on the Conservatives. 

The next time around, both parties would do well to follow Nathan Cullen's advice and form a strategic alliance. The Harper Conservatives will  -- you'll excuse the pun -- turn blue. But they will not be able to claim that the opposition is a "separatist coalition."

In the end, it will take such a coalition to stop the Conservative juggernaut.

Oil Is Their Lifeblood

 If there was any doubt that the Harper government is owned by the oil companies, Joe Oliver's rant last week against foreign "billionaire socialists" should put an end to any misconceptions. As Jeffrey Simpson points out, Oliver's oxymoron was yet another example of Harperian hypocrisy. Canadian money flooded Washington a year ago in support of the Keystone Pipeline:

To influence U.S. opinion, both at the level of legislators and the general public, Canadian companies poured untold millions into the fray. They papered Washington with lobbyists, including someone who was once high up in Secretary of State Hillary Clinton’s campaign for the Democratic nomination and two former U.S. ambassadors to Canada. The Harper government put Canada’s entire diplomatic apparatus in the U.S. behind the Keystone campaign. The Prime Minister himself went to the U.S. and declared approval of Keystone a “no-brainer.”

Even more disturbing is the government's attempt to shut down the environmental assessment hearings. As is this government's practice, it seeks once again to tar its opponents. But they will not back down:

Sierra Club of Canada Executive Director John Bennett accused the government of engaging in an unprecedented effort to damage the credibility of the “mainstream” environmental movement.

Of the Northern Gateway hearings, Bennett said, “People are just exercising their democratic right to be heard on an issue that will impact all Canadians, present and future. The purpose of an environmental assessment is to ask tough questions and hear the answers. Why does Mr. Oliver so strongly object to this? Do we no longer live in a democracy? Do our citizens no longer have the right to ask tough questions and express their opinions?”

Bob Rae argues that the government's tactics are tantamount to interfering in a law case. But, as the recent passage of the bill to abolish the Canadian Wheat Board proves, the Harperites believe that the law is an ass -- unless they make the law. Oil is this government's lifeblood.

So Much For Senate Reform

"The Upper House remains a dumping ground for the favoured cronies of the prime minister," a righteous Stephen Harper proclaimed back in 2004.  As is always the case with this prime minister, it is instructive to compare his past statements with his present practice.

His recent Senate appointments provide yet another lesson in just how principled a leader Stephen Harper is. Stephen Mahar reviews the newest members of the chamber of sober second thought.  Harper appointed Norm Doyle who:

wisely opted not to run in the 2008 election after voting with Harper and against his province on the Atlantic accord. The Senate appointment is his reward for voting against the clear wishes of the people who elected him, which is exactly the sort of thing that used to send smoke pouring out of the ears of the Reformers who pushed so hard for an elected Senate.

The same pattern applies to most of the other new arrivals:

CFLer David Braley, who donated $46,500 to that long-ago leadership campaign, and tens of thousands more to other Conservative candidates.

Leo Housakos, a key Quebec organizer who learned the ropes fundraising in Montreal at the provincial and municipal level.

Former CFLer Larry Smith, who ran unsuccessfully in Quebec, and complained when he was appointed that he was taking a "dramatic, catastrophic" pay cut.

Patrick Brazeau, the only prominent aboriginal leader to support Harper, who wanted to keep picking up his paycheque as a leader while sitting in the Senate.

 

He appointed campaign manager Doug Finley, fundraiser Irving Gerstein and spinner Carolyn Stewart Olsen, where they can help him behind the scenes while we pay their salaries.


So much for Senate reform. But then again, "reform" for Stephen Harper has always meant marching backward.

A Passion For Politics

There has been a lot of talk over the last couple of years about reforming Canada's democratic institutions -- electing the Senate, moving to proportional representation, and cleaning up Question Period. Changing all that machinery might make things better. But, as Robert Asselin points out, none of those changes carries a guarantee:

We could do all this. And probably solve some of our problems at the margin.
But it won’t make our politics better.
It won’t produce statesmanship.
It won’t empower us as fellow citizens.
As such, these institutional reforms won’t bring more civility and substance into the public discourse.

For none of those reforms solve our real problem -- which is civic apathy. What Canada desperately needs is an engaged citizenry. Asselin continues:

In a recent iPolitics column, Allison Loat, who leads the wonderful initiative called Samara, wrote that “Canada needs to cultivate more political citizens”. I think it captures the essence of our challenge. We can’t afford to see politics as something that belongs to a few insiders. We can protest – and we certainly should when it is needed – but what about occupying the vehicles that can make change happen, namely the political parties? We can also create new ones if you we don’t like the ones we have.

Some of us, myself included, have wondered when Stephen Harper will reach the tipping point -- when the citizens of this country will rise up and say with one voice, "we have had enough." They did it with Brian Mulroney. They did it with Chretien and Martin. But, so far, they have grumbled and remained passive during what Lawrence Martin has called a "year of moral bankruptcy."

As  long as we are willing to take it, Stephen Harper will be more than willing to dish it out. Canada needs citizens who have a passion for politics -- people, for instance, like Norman Bethune.

Selective Memory

In his song,The Boxer, Paul Simon sang, "A man hears what he wants to hear, and disregards the rest." Frank Bruni points out, in this morning's New York Times, that this human frailty is particularly true of the Bushes -- father and son -- and the place they hold in the present Republican narrative:  In the case of Bush the Younger, Bruni writes that:

They seldom mention Bush positively. They seldom mention Bush negatively. They also never mention the Bush before Bush — the other slice of bread in the Clinton sandwich — and have thus turned the father and the son almost wholly into ghosts.

You’d think Ronald Reagan, who is invoked incessantly, was the last Republican president, and you’d think he was not only a flawless chief executive but a sinless adherent to current Republican dogma.

The eight years when the last Republican president occupied the White House have gone down the memory hole. That loss of memory is quite purposeful:

[The] debt has indeed risen at a terrifying pace over the last three years, but for reasons that have a great deal to do with ... George W. Bush. The perpetuation of his tax cuts, the continuation of his new prescription drug benefit, the management of his wars and the interest payments on debt that he accumulated account for a crucial share of the additional sum Obama has amassed. And while the details of Obama’s stimulus spending and bailouts can and should be seriously questioned, the need for action stemmed largely from a severe economic downturn that began under 43. 

Even more interesting is how Bush the Elder has been air brushed from the Republican pitch. His fiscal record is the exact opposite of his son's:

FOR real, brave fiscal responsibility, Republicans should refer to and lionize the 41st president, the other George Bush. Much of his record, including his decision to exit Iraq after removing Saddam Hussein from Kuwait, shimmers in retrospect.

At great political cost, he allowed a tax increase appropriate to the fiscal circumstances. More than a few economists believe that it set the stage for the boom of the Clinton years. But 41’s budgetary approach is less likely to draw attention from present-day Republicans than 43’s. It runs counter to the party’s anti-tax obsessions. It’s anathema.

Instead, to the uninformed it appears that the last Republican president was Ronald Reagan. But, even in his case, Republican memory is highly selective:

As one prominent party strategist laughingly reminded me this week, Reagan allowed a dozen tax increases by some counts and measures; put Sandra Day O’Connor, an eventual disappointment to conservatives, on the Supreme Court; and signed the Simpson-Mazzoli immigration reform act, which gave amnesty to three million illegal immigrants. The liberal in Obama must be green with envy.

The truth is that neither the Bushes nor Reagan fit the present narrative. Republicans are cherry picking evidence to fit their thesis. It may work as an advertising ploy. But it's disconnected from reality and the truth.

This entry is cross posted at The Moderate Voice.

A Long Way To Go

After the last election, Peter C. Newman wrote an obituary for the Liberal Party. Some of us thought it was premature -- if only because a week is a long time in politics. The coming Liberal convention will allow us to have a peek inside what Stephen Clarkson once called "The Big Red Machine" to determine how much life is still in the party.

Robert Silver writes in The Globe and Mail that those who expect the old party to rise like Lazarus after the convention will be disappointed. It's not that there aren't important changes needed to the Liberal constitution. And the proposal to abandon the monarchy is bound to generate some heat. But, Silver writes,

We still need to develop a new, coherent policy proposal for Canadians that is very different from the one we have put forward in the past. We still need to decide what our new voter coalition looks like. We still need a new leader who’s economically literate, has a clear plan for the party and the country and can dedicate 15 years to the job. In other words, while small progress has been made since May, most of the really tough decisions and trade offs remain. None of that was ever going to happen at this biennial. 

The one thing that Liberals have in their favour is time. Unfortunately, Stephen Harper can -- and will -- do a lot of damage during that time. But for the first time in a long time, the Liberals do not have to prepare for an election. If they are wise, they will use their convention to lay out an action plan which will accomplish what Silver says needs to be done. There is still a long ways to go.

Where Are The Ideas?

 Susan Riley writes this morning that Canada is in desperate need of new ideas:

We need (another) overhaul of the tax system, to remove boutique credits that add complexity at the expense of fairness; and to close loopholes that allow the wealthy to shirk their responsibility. We need to bolster public pensions, get serious about energy conservation and strategy, and get creative about health care.

Instead, we get more commentary on the horse race, who stuck it to whom, and more voter apathy.   Stephen Harper flourishes in such an environment. He came to Ottawa to stick it to a lot of people. And he has ideas:

There are rumours the Conservatives will move the retirement age to 67, for example; there is a good chance Canada will involve itself in a war against Iran, or Syria. These are not, necessarily, good ideas but they are more worthy of contemplation than, say, Senate reform.

If those ideas are adopted, the consequences are clear. It is no accident that income inequality is now rising faster in Canada than in the United States. But the NDP is focused, as it should be, on picking a new leader. And the media are focused on whether or not Bob Rae will stay on as permanent Liberal leader.

The Liberals got lost in the weeds of personal ambition and forgot the people they were supposed to represent.One hopes that the NDP will not make the same mistake. The only way to gain public support is to develop a program that people will buy.

If the Liberals are smart when they meet next week, they will focus on ideas -- not Bob Rae.

Working For The Man

Back in October, when 6,800 Air Canada workers rejected a second offer from Air Canada, the Harper government intervened immediately, claiming that the strike endangered the Canadian economy. Air Canada is a private corporation. But the Conservatives claimed that, because transportation fell under federal jurisdiction, they had to intervene.

When 420 workers at Electro-Motive Canada were locked out by their employer five days ago -- and were told to take or leave a 55% pay cut -- the Harper government remained silent. Such was not the case in 2008, when Stephen Harper appeared at the plant to announce $5 million in tax breaks to locomotive buyers and another $1 million in tax breaks for capital investment in the company.

Electro-Motive is a private company also involved in transportation. But it's owned by Caterpillar. And therein lies the difference. During the last election, Mr. Harper claimed that he was working for Canadians. The Electro-Motive strike and the Air Canada strike prove that Harper is working for the man -- or men -- who, according to Hugh Mackenzie's report for the Canadian Centre for Policy Alternatives, earned as much in the first three days of this year as the average Canadian earns in a year.

And he sees nothing wrong with the workers at Electro-Motive earning 55%  less this year. Behold the Prime Minister of Canada.

Fathers And Sons

In the wake of Mitt Romney's eight vote win in Iowa, Maureen Dowd offers a column on the volatile relationship between fathers and sons: "American politics," she writes,"bristles with Oedipal drama:"

Sons struggling to live up to fathers. Sons striving to outdo fathers. Sons scheming to avenge fathers. Sons burning to one-up fathers. Sons yearning to impress fathers who vanished early on. Sons leaning on fathers. Sons using fathers as reverse-play books. 

Mitt Romney appears to be haunted by the ghost of his father -- a good man who made the mistake of admitting that he had been "brainwashed" by propaganda on Vietnam. Whatever the younger Romney's faults, being brainwashed does not appear to be one of them. His real problem seems to be adhering to the party line.

Then there is the case of George H.W. and George W. The jury is still out on their legacies. But historians will surely note that both men had their own Iraq Wars. There is also the case of Al Gore Sr. and Al Gore Jr. Both Gores rose to become senators from Tennessee. But Junior almost became president, winning the popular vote but losing in the electoral college.

Bill Clinton and Barack Obama did not have to deal with political fathers -- however, they both lost their fathers early; and both had to adjust to stepfathers.

These days, political ambition seems to run in the family -- like father like son. Dowd writes:

Even though Mitt is far more conservative these days than his moderate dad, he loves talking about his parents on the trail, recounting the time they took him in the Rambler for a cross-country drive to see monuments. He has called his dad “the real deal” and the definition of “a successful human” and explained his political ambition as “a family gene.” 

It's undeniable that some fathers cast long shadows. Whether -- in the case of political candidates -- that's good or bad is surely a legitimate topic for debate.

This entry is cross posted at The Moderate Voice.

Whose Brain Is Half Full?

Kelly McParland recently nominated the Occupy Movement for The National Post's "brain half full award."  He scornfully described the movement as:

People lying around in tents in downtown parks because somehow that will combat “corporate greed”, or solve one of the two dozen other complaints they had, which essentially boiled down to: “I want the world to be different, but I don’t want to have to put out any effort myself, other than hanging out in this tent.” In the U.S. there was real reason for protest; in Canada it was mainly, “Hey, look what they’re doing in New York. I wanna do that too.”

But reports this morning in The Globe and Mail and The Toronto Star suggest that the  Post's collective brain is half full. Consider the position of Canada's top 100 CEO's:

The 100 highest paid chief executives whose companies are listed on the S&P/TSX composite index made an average of $8.38-million in 2010, according to figures pulled from circulars by the Canadian Centre for Policy Alternatives, a left-leaning think-tank. 

During the same period:

Regular Canadians, on the other hand, have seen their wages stagnate over the past few years. In 2010, after adjusting for inflation, average wages actually fell.

Put another way, on this -- the third day of the year -- the average Canadian CEO has made more money than the average Canadian will make all year. Hugh Mackenzie, the author of the report, says that Canada's business elite and the rest of Canadians are living on two different planets:

“The people at the very top of the income scale — and CEOs are at the top of the top — have really launched themselves into a kind of economic interplanetary travel. If the rest of us are on earth, they're off somewhere else in a different world. I think that's unstable.

And Stephen Harper says that cutting corporate taxes will create more jobs, while .E.I. contributions should be raised. Something's wrong with this picture. Those folks in the tents know what's going on.

The Wrong Analogy

No doubt the folks at the Heritage Foundation will pillory Paul Krugman for his column in this morning's New York Times. Their disrespect for him matches his own disrespect for them. On the subject of the national debt, Krugman writes:

Perhaps most obviously, the economic “experts” on whom much of Congress relies have been repeatedly, utterly wrong about the short-run effects of budget deficits. People who get their economic analysis from the likes of the Heritage Foundation have been waiting ever since President Obama took office for budget deficits to send interest rates soaring. Any day now!

And while they’ve been waiting, those rates have dropped to historical lows. You might think that this would make politicians question their choice of experts — that is, you might think that if you didn’t know anything about our postmodern, fact-free politics.

The problem, Krugman claims, is that right wing ideologues have chosen the wrong analogy. They claim that the U.S. government is like a family who has taken out too big a mortgage. But that's simply not the case, for two reasons:

First, families have to pay back their debt. Governments don’t — all they need to do is ensure that debt grows more slowly than their tax base. The debt from World War II was never repaid; it just became increasingly irrelevant as the U.S. economy grew, and with it the income subject to taxation.

Second — and this is the point almost nobody seems to get — an over-borrowed family owes money to someone else; U.S. debt is, to a large extent, money we owe to ourselves.

Of course, Krugman's critics will say that's absurd. America is on the hook to China. But, according to Krugman:

It’s true that foreigners now hold large claims on the United States, including a fair amount of government debt. But every dollar’s worth of foreign claims on America is matched by 89 cents’ worth of U.S. claims on foreigners. And because foreigners tend to put their U.S. investments into safe, low-yield assets, America actually earns more from its assets abroad than it pays to foreign investors. If your image is of a nation that’s already deep in hock to the Chinese, you’ve been misinformed. Nor are we heading rapidly in that direction.

Krugman repeats the argument he has been making for a long time. Politicians should be  focusing on unemployment. When people go to work, tax revenues go up -- and deficits go down. But that won't happen until those in charge get their analogies right.


This entry is cross posted at The Moderate Voice.

It's All About Contempt

When the Harper government was found in contempt of parliament, the prime minister defined the problem as a not having enough votes. It was, he said, "simply a case of the other three parties outvoting us."   With a majority, he now argues, there can be no such thing as contempt.

But, in Friday's Globe and Mail, Peter Russell asks a seminal question about  how we are governed:  "Does it matter if our laws are passed illegally?" The question arose after the government decided to ignore a federal court decision which held that Bill C-18 -- the bill to abolish the Canadian Wheat Board -- was illegal. The Harper government simply decided that it could ignore all legal precedents and kill the Wheat Board.

Previous legislation guaranteed farmers a referendum about future changes to the Wheat Board. Russell writes:

The government has defended its action constitutionally under the banner of parliamentary sovereignty. But against this position is the view that Parliament can bind itself as to the “manner and form” of future legislation, a view supported by many constitutional scholars in Canada and other Westminster parliamentary democracies. Taking this view does not mean that Parliament can never change its mind and rescind legislation passed by previous Parliaments. But if it is going to depart from a process of law-making that an earlier Parliament committed to, it must do so explicitly and repeal the legislation.

The government took the position that, with its new majority, it can do what it wants. It has no responsibility to honour promises made by previous governments. By that logic, it has no obligation to honour previous promises about the Canada Pension Plan, Old Age Security or Medicare. A majority government only requires approval in a general election. All other checks and balances then become null and void.

Russell warns his readers that:

Canadians should understand that at stake here is not just a technical point of law, but the integrity of parliamentary government. In placing Section 47 in the Wheat Board Act, Canada’s 36th Parliament made a commitment to grain growers that it would not consider changing the rules for marketing their crops without their consent. To hold that such a promise means nothing once another party has a majority in the House of Commons is to deny Parliament the capacity to make such commitments to citizens whose interests are so directly affected by legislation.

It should be obvious by now that the Harper government stands for contempt -- contempt for parliament, contempt for the courts, contempt for the press and, ultimately, contempt for citizens. When those citizens gave Mr. Harper his majority, they did not give him carte blanche do do as he wishes.