Monday, June 30, 2014

Volatile gas revenues tend to evaporate

BC Liberals are reluctant spenders when it comes to improving public schools. However, they're not reluctant to put money into the pockets of natural gas producers. The amounts are in the billions but it's not much discussed, either in the Legislature or in budget documents. However, careful reading of the province's audited financial statements reveals this information:

Net Gas Royalties

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Ability-to-pay does not apply

A few years ago, Glaxo SmithKline, a multinational drug company, agreed to settle an American tax dispute by paying $3.4 billion and abandoning claims for refunds worth a further $1.8 billion. GSK used improper transfer pricing schemes to shelter profits outside the USA. It's a common practice but few coutries have the political will or the resources to challenge accounting practices of corporations that are wealthier than most nations. Additionally, Big Pharma spends huge amounts on lobbying and acquiring political support.

According to the Centre for American Progress,
"Recent analysis indicates that U.S. corporations are currently holding as much as $2 trillion in untaxed profits booked as offshore income."
In 2012, Canada lost a transfer price case against GSK in Supreme Court. Canada Revenue Agency claims that it enforces rules strictly but rather few signficant cases have been addressed. Part of the reason is that Canadian laws and regulations are friendly to multinationals. That was illustrated recently in the financial press:

Financial Post, June 18, 2014
Allergan Inc. is readying a bid for Irish drug manufacturer Shire Plc as it seeks to foil a hostile takeover from Canada’s Valeant Pharmaceuticals International Inc…

Shire is registered in Jersey while its corporate headquarters are in Dublin…

Unlike its U.S.-based rivals, Valeant pays a tax rate under 5%. The company benefits from a Canadian tax regime that allows companies to shift their intellectual property centres to low-tax jurisdictions such as Bermuda and repatriate the profits without incurring more tax.
Dow Jones News Service, June 30, 2014
LONDON--Shire PLC (SHP.LN) said Monday that its Canadian unit will receive tax refunds totaling $410 million from Canadian revenue authorities.
The Harper Government does not have much regard for science, but it has regard for multinationals companies and pays them to do research, even rewarding companies that do not pay income tax and shift intellectual property elsewhere after they create it.

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Tuesday, June 24, 2014

Unfairness, unfairly applied

Christy Clark claimed teachers are greedy and that BC cannot afford to pay more for public education. Liberal social media retainers continue echoing the claims. We know that labour relations in BC schools have long been contentious but that will only change when both sides decide to act with restraint and respect.

Describing teachers as avaricious was careless. It is scurrilous if untrue.

Because teacher pay scales are less than simple and depend on various factors, I decided to choose a single large category of educators and compare how that sample changed over time to the changes experienced by other elements in public service.

This demonstrates the pay rate has not kept up with inflation and teachers in this category need a 7% increase to return to the level of 15 years before.

But then, if times are tough and the province is suffering financially, maybe all public servants must sacrifice. Let's examine if decision makers have made any sacrifices.


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Clark Government earns failing grades

"Teaching is not a lost art, but the regard for it is a lost tradition."Jacques Barzun

Successful nations that intend to maintain economic and social powers have high regard for universal education. They know that for tomorrow's adults to enjoy success, youth must acquire foundational skills and attitudes. Teachers and well managed public schools are vital to building the needed competencies.

Unfortunately, most political and business leaders do not worry much about the future. Larry Fink, head of BlackRock Inc., the world's largest asset manager, calls it, "persistent and pernicious short-term thinking."

Additionally, a selfish attitude grows within segments of society. It is the idea that "proper" education should be reserved for elites. For everyone else: education-lite. This means basic low cost, no-frills, technical and vocational training, dependent on what business needs today. If Enbridge wants welders, we will train welders. If Starbucks needs counter staff, we teach people how to open bags, fill hoppers and press buttons.

However, we won't even commit sufficient resources to pursue this strategy. It is too easy and too cost efficient to import worker bees from elsewhere and, when our needs are complete, return them without having to worry about anyone expecting "entitlements."

Claims are made that a division between proper-education and education-lite benefits the talented but, in reality, the emphasis mostly benefits the privileged. However, when the decision makers are themselves privileged, they're ok with that.

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Monday, June 23, 2014

The states of state affairs

Comparing remuneration of senior public officials in Washington State to BC counterparts can leave one astounded. The most obvious examples are at the publicly owned investment management agencies and the ferry operations.

Despite paying substantially less to executives, both Washington State Investment Board and Washington State Ferries outperformed equivalents north of the border. In recent years, WSIB earned better investment returns than bcIMC and WSF had growing utilization while the opposite is true at BCF. My review of Washington’s senior civil servants is also demonstrating major differences.

I surmise that rules of open government in the neighboring State are great moderators that restrain influential groups of individuals who aim to advance their own private interests. The open government web page of Washington State begins with this statement,
“Government accountability means that public officials - elected and un-elected - have an obligation to explain their decisions and actions to the citizens. Government accountability is achieved through the use of a variety of mechanisms - political, legal and administrative - designed to prevent corruption and ensure that public officials remain answerable and accessible to the people they serve. In the absence of such mechanisms, corruption may thrive."
It goes on,
“The Washington Public Records Act is one of the strongest open government laws in the nation and reflects the desire of Washington citizens to know what their government is doing. A transparent and accessible government is essential to a successful free society, and fosters trust and confidence in government.

“Strong ‘sunshine laws’ are crucial to assuring government accountability and transparency. In Washington State, those laws provide for open public records and open public meetings…”
In British Columbia, the Liberals came into office promising complete transparency and accountability. Gradually, this commitment eroded. Today, it barely exists except in meaningless matters. Information is now a commodity for spin masters to massage until meaningless. If the public identifies a fault in government programs, the first response is not to rectify the situation, it is to begin a PR campaign to pretend it never existed, and if it did, it was corrected long ago.

That is an ironic situation: taxpayers pay people who focus comprehensive efforts to ensure those same taxpayers have a distinctively incomprehensive version of events and states of state affairs.

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At least Liberal inconsistency is consistent

BC’s recent Budget and Fiscal Plan states total provincial debt is $63 billion. This amount, 62% higher than in 2009, is 27.3% of gross domestic product. Five years ago, the ratio was 18.7%.

By any standard, that is rapid debt growth. Unfortunately, those numbers present only part of the story.

In addition to admitted debt, the province is obliged by $100 billion in other contractual commitments.

If Liberals conducted business and accounting now as they did a few years ago, the debt reported for fiscal year 2014 would be nearer $163 billion than $63 billion. But, at least the details of how and where that money was spent would not be hidden behind secret public private partnerships.

The following summarizes these obligations for fiscal years 2012 and 2013. I will update the worksheet when numbers become public. Of course, the amounts listed are millions of dollars.

Future Commitments 2012 and 2013

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Monday, June 16, 2014

Dealmakers have been busy

People reacted to a tweet of information first published at Northern Insight. Many read it but do not want to believe it, because, as much as anything, this demonstrates whom the BC government serves. It is not Mr. and Ms. Taxpayer.

People claimed the graph could not be accurate because it has not been published elsewhere. After I provided data sources, they said it has not been displayed this way before, so it must not be correct. Mind you, at least some of the people saying this aim to maintain the myth that pro-media provides the only reliable information.

After examining this graph, do you imagine that natural gas will yield billions of dollars in future benefits? If you do, the next question should be, "Why do you think this possible?"

First, there needs to be a commitment to earn direct revenues from companies licensed for large-scale exploitation of public assets. That resolve does not exist in BC. Liberals focus on making deals because that enables dealmakers to grow rich. Managing the deals is not something they care much about.

This is another graph that government partisan don't like. I add the caution that it shows numbers from March 31, 2013. Current numbers are not available to the public.

Obviously, the Liberal insiders and dealmakers have been busy and very, very successful.

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Sunday, June 15, 2014

Express yourself

For links that work, click here.

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Wednesday, June 11, 2014

$80M annual power subsidy, one LNG proposal

Regular readers know that I focus attention on natural resource revenues earned - more often, not earned – by the citizens of British Columbia. Click here to read many articles on the subject. Information I use is usually from Finance Ministry documents such as Public Accounts, including audited financial statements, and from reports by Statistics Canada and BC Stats.

Natural resource revenues declined steadily in recent years and despite phoney claims of LNG riches to come, there will be few rewards without government gaining a willingness to secure them. For years, Liberals preferred boosting corporate profits to fair taxation of natural resources. Now, they're preparing to spend billions on subsidies and for capital infrastructure demanded by mostly foreign owned LNG proponents.

You can bet the same model forced on BC Hydro for private power producers will be in play: taxpayers will absorb substantially all of the commercial risks while the profits accrue to private business.

The following letter was published by the Squamish Chief. It analyzes one LNG operation that is being fast-tracked so that Premier Photo Op has a backdrop for what she does best.
In his letter to the Squamish Chief (Letters, May 29), Woodfibre LNG VP Byng Giraud denies electrical subsidies for his proposed plant. He apparently needs help with his math and the basic definition of subsidy, because if Woodfibre “goes electric” from our B.C. Hydro grid, B.C. Hydro and all its residential customers will be subsiding the proposed operation to the extent of about $80 million per year. Here’s why:

All new/incremental private power is acquired and delivered at a cost of more than 12 cents per kilowatt-hour, while Woodfibre LNG is banking on only paying the bulk industrial rate of just over four cents per kWh, a subsidy of eight cents per kWh arranged through our B.C. Liberal government. (And government is desperate to get some of these LNG export operations going.)

Since liquid natural gas LNG plants are notorious power hogs, and this small operation alone would consume 120 megawatts (conservatively estimated from its 140 mw transformer, and known power consumption of LNG process “trains”), this comes to a subsidy of more than $80 million per year. Again, who will pay for this subsidy? The residential customers and small businesses of British Columbia.

It’s almost humorous that Giraud would quote private power lobby “Clean Energy Canada” frontman Merran Smith who says that “… Woodfibre LNG is off to a good start powering the plant with [subsidized B.C. Hydro] electricity, and that it sets the standard for others to follow,” because it’s also easy to see that if the rest of the proposed northern LNG export operations (50 megatons per year of LNG in total, compared to Woodfibre LNG's two megatons/year) also “go electric” with B.C. Hydro grid power at the bulk industrial rate, our subsidy would then be $2 billion per year.

There’s much more out there on the economic disadvantages of LNG export, including the significant domestic price inflation (higher rates) for natural gas that we will be paying within B.C. for our own home heating if export moves ahead.

LNG export is an economically bad idea that only benefits the foreign corporations promoting it.

Doug Morrison

One person told me Woodfibre LNG will provide fewer permanent jobs at the Howe Sound facility than does the new Sea To Sky Gondola. Regardless of subsidized electricity and the capital needed to upgrade power and feedstock delivery, I wonder how many consider Woodfibre a good site for LNG, now or when Gordon Campbell's friends subdivide ex-BCR lands on the eastern shores of Howe Sound.

Consider the following from my article, LNG facilities: siting, safety, regulation, keeping in mind the current BC Liberal Government believes that companies should "self-regulate" as was expected of Montreal, Maine and Atlantic Railway before it killed 47 residents of Lac Megantic. The folowing information is from a U.S. Government report,
"If LNG spills near an ignition source, evaporating gas will burn above the LNG pool. The resulting "pool fire" would spread as the LNG pool expanded away from its source and continued evaporating. A pool fire is intense, burning far more hotly and rapidly than oil or gasoline fires.

"It cannot be extinguished—all the LNG must be consumed before it goes out. Because an LNG pool fire is so hot, its thermal radiation may injure people and damage property a considerable distance from the fire itself. Many experts agree that a large pool fire, especially on water, is the most serious LNG hazard.

"If LNG spills but does not immediately ignite, the evaporating natural gas will form a vapor cloud that may drift some distance from the spill site. If the cloud subsequently encounters an ignition source, those portions of the cloud with a combustible gas-air concentration will burn. Because only a fraction of such a cloud would have a combustible gas-air concentration, the cloud would not likely ignite all at once, but the fire could still cause considerable damage.

"An LNG vapor cloud fire would gradually burn its way back to the LNG spill where the vapors originated and would continue to burn as a pool fire..."
Last year, my wife and I stopped briefly in Qatar, an Arab emirate on the Persian Gulf. They are major players in the business of LNG but this energy rich nation recognizes that a strong economy cannot be sustained on fossil fuels. Accordingly, Qatar is focusing on building a knowledge-based economy, aiming for extraordinary scientific and technological advancement. Cornerstones of the strategy are education and research.

I find it significant that a country made wealthy through oil and gas knows it must focus on a diverse economy. Qatar operates one of the world's truly fine airlines and expects travel and tourism to be important contributors in the future. It is emphasizing educational reforms for both men and women and encouraging research and development of new technologies. The country is building great medical facilities and centres of higher learning. The Emir of Qatar stated that education is an essential tool in the social and economic development of any country.

Meanwhile, in British Columbia, we're on the opposite path. We're degrading knowledge based activites and waging war on educators. This sends messages to people outside British Columbia that we should be their at the bottom of their list of choices if they want to come here to educate or be educated. Most of the world is trying to address the problems associated with fossil fuels; we're committing to add to the problems.

This is nothing more than self-destructive idiocy that results from political leadership consumed by desires for immediate enrichment of themselves and a circle of greedy friends. History will not be kind to these fools.


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Thoughts on Education From the Inside

Thousands of people read this article since its publication June 1, so it is returned to the top for readers' convenience.
By Brad Farrell
High school teacher and concerned parent

"What do you do for a living?" A question. A common question. One people ask to start a conversation. One that comes up when meeting new people. One I'd bet most of you have heard, probably many times. One I hesitate to answer. Not because I don't have an answer. I have a job, a career even. Not the best job, not the worst. A job that isn't as rewarding, fulfilling or enjoyable as it used to be. A job that will only get less so if things continue as they have.

"I am a teacher." It is an answer. Not the best answer, not the worst. It is however, an increasingly unpopular answer. More than ever, acknowledging I am a teacher leads people to judge me and my motivations for doing what I do. The reactions I get from people are less positive year by year. Fortunately, I've met many people capable of moving beyond their biases, who come to know me the person, not me the profession.

So where to start? As in most debates, people find themselves on both sides of the issues. Some people actually know the issues; fewer understand the meanings. Agree with their positions or not, at least give them credit for being informed. Many have no idea at all what the issues are, but feel very strongly about their positions regardless, be they rational or not. As for myself, predictably I am upset and frustrated with the government's position on education, though I am not unquestioningly pro-union as that might imply.

Not totally pro-union? Contrary to what many people think, I, as a teacher, do not believe the BCTF walks on water. They've done plenty wrong over time. Most people understand that in a negotiation you ask for more than you want, the other side offers less than you deserve and you eventually settle somewhere in the middle. The BCTF though has loaded the bullets for the other side by routinely asking for ludicrously large increases, most publicly to wages. It is the most obvious, but not the only, evidence to suggest my union doesn't know how to fight a PR battle, let alone win one. Shooting off your feet is a decidedly poor way to get anywhere. They know where they want to go but unfortunately don't always know the best way to get there.

What's wrong with a teacher wanting to make more money? This is a question that baffles me. Everybody on the planet wants to make more money, why can't I? Speaking for myself I want a wage increase that accounts for an ever more expensive cost of living, plus a bit extra to allow me to make up some of the monies I've lost after a number of years of static wages. I'm sure most people make more money than they used to, or than people who did the same job in the past. Christy Clark and her deputies make more money than previous senior political officers did. Yet this week in Premier Clark's busy schedule, packed full of policy making and other tasks of governance, she found time to publicly label my colleagues and I greedy and in it for the money. Am I really so different from everyone else because I want better pay?

Why shouldn't teachers get a wage increase? Historically in negotiations, teachers have given up wage increases to secure other concessions, most notably changes in class size and class composition. Government has stripped those negotiated articles from our contract, so why shouldn't we get the wages we gave up to get the particular gains we've now lost? Besides, though I don't often find myself agreeing with Vaughn Palmer, maybe he put it best. I recently heard him on CKNW address the talking point of "teachers should take a deal in line with other public-sector unions." His adroit and succinct response was teachers took less last time, so why shouldn't they get more this time?

Why do class size and class composition matter so much? I'm a little stunned that anybody accepts the argument class size doesn't affect student learning. At my school, classes are 80 minutes long. I teach a Science 8 class in English to 27 students. I also teach a Science 8 class in French to 20 students. Seems obvious to me that 80 minutes for 27 students versus 80 minutes for 20 students means the students in the class of 27 get less of my time. Everything I do in that larger class takes 10-15% more time, meaning I do less with my larger class. As for composition, next to that Science 8 class of 27, I teach a Chemistry 11 class of 29. Granted, grade 11 students tend to be more mature and responsible than grade 8s. In the Chemistry 11 class of 29, every student has chosen to be there, as it's an elective course, and I have one student identified as having special needs. In the Science 8 class, I have two students identified by the Ministry of Education as special needs and an additional eight informally identified who require extra consideration and who attend learning support blocks, but who don't have a Ministry designation. That's roughly a third of the class, on top of any English as a Second Language students or students who don't want to take that course, but who have to, as it is a requirement. See how long it took to describe one class versus the other? Can you guess in which class I'm better able to teach and students better able to learn? Class size and composition do matter.

How can the government claim class size and composition don't affect student performance? The government defends its actions of removing class size and class composition language from our contract because it's too expensive to accommodate and isn't a factor to student success anyway. They support this latter conclusion by referring to studies that suggest student performance has not suffered since their removal of class size and class composition considerations. The explanation for these conclusions in my opinion is simple – government has the ability to lower the bar of success and redefine student achievement. Student assessment models and performance standards are established by the government. They are different today than they were when I started teaching. So to be clear, government claims to make funding decisions based on student performance. Neatly, they also set policy on how students are assessed and their performance determined. Anybody else see a conflict in that?

Does the union have the students' best interest in mind? They believe they do and much of the time I think actually do. That is, however, not their mandate nor their reason for existing. The BCTF was created for and is funded by its members. I pay union dues so that they can protect my interests, advocate for my working conditions and negotiate on my behalf, not to look after students. The two concepts of working conditions and learning conditions often conflate, even overlap, but they are not the same. The sad truth is though, if the union doesn't take some stance to fight for students' learning conditions, who will? At some level, smaller classes and more specialist teachers mean higher staffing levels, a coup for any union. That fact does not negate their educational value to students. Are not student needs what the stewards of education look after, even fight for? If not all the stewards, at least some of them?

Which affects students more, Stage 1 of the strike or the partial lockout? Teachers went on strike first – Stage 1 – albeit a limited strike. That word "limited" is one the government and media seem unable to remember or use. During that action, I stopped meeting with Administration and receiving written correspondence from them. I could still talk to Admin and they could still talk to me. You know, old-school face-to-face conversations. It could be an informal discussion, just not a formal meeting. Anything that was an emergency or that had to do with student safety or discipline was exempt and could be communicated in writing. I continued teaching, assessing, helping outside of class time, communicating with students and parents, in short all the things I do that affect student learning.

In response to that limited strike, the government introduced a partial lockout. A lockout so effectively communicated they required two additional clarification letters and some back peddling to ensure it said and meant what they intended. Part of the terms of the lockout are that I cannot do paid work during lunch. Given I'm paid to teach and work with students, by government lockout, I am not able to help students or administer make-up exams at lunch. So which action affects the students? Which action, the limited strike or the partial lockout, has restricted the time I can spend with my students? Granted I can still work with them 45 minutes before and 45 minutes after school, but often that isn't the best time for them or for me. It is for certain though, the only time outside of class I am allowed to work with them. By government lockout.

Doesn't the Stage 2 rotating strike action affect students? Absolutely. Affects teachers too. Beyond the day's pay I will lose, I'll lose an instructional day, probably more than one. I will have to determine the best way to reschedule the remainder of my year's plan into fewer days. I will be relying on my training, experience and adaptability to minimize the effect on students' learning. If Stage 2 continues to the end of the school year at one day per week, up to four days will be lost in high school, up to five in elementary. Not inconsequential, but consider this. I have a significant number of students who miss more days than that through extended vacations, being pulled out on Friday by parents for a weekend in Whistler, dance and sports competitions, music festivals . . . the list goes on.

Does the government's partial lockout prevent me from doing volunteer, extracurricular activities? In a word – No. It took them a few tries to get the wording clear and to suit their intention, but I am allowed to be in my school as late after class as I want to be. I can only do paid work during the first 45 minutes, but I can stay and do as much unpaid work as I want. So I'm not prevented by lockout from coaching or doing other volunteer work. But why on Earth would I? The government has restricted the time during which I can work, is paying me less to do the same teaching and assessing, but is hopeful I'll continue volunteering my own time outside their restrictions? How would you respond to receiving direction to do the same work you do for customers, in less time, for less money, and then were asked to volunteer later in the day? Your response might be as colourful as mine.

What about students caught in the middle? My answer is simply, what about them? Those students have parents. Parents who can also volunteer to coach their child's team or to hand out certificates as students walk across the stage. Someone volunteering to organize and run extracurricular activities is in the students' best interests. That someone being a teacher is in the best interest of the government and of parents. Government, because it means an employee working for free and parents because it means a commitment they don't have to make. To say extracurricular events cannot take place and even to cancel them because teachers are not volunteering is a cop out. The fact that teachers volunteer at all means others don't have to. If teachers do not volunteer, parents are welcome to fill the void.

How can government increase funding to public schools when there is no money, be it for teacher salaries or other expenses? An excellent question, if it were true there is no money.

"The greatest trick the Devil ever pulled was convincing the world he didn't exist." This quote comes from the 1995 film The Usual Suspects. It could just as easily read "The greatest trick government ever pulled was convincing the electorate they'd run out of money."

Governments exist to collect revenue, make policy and set priorities, then spend our money and tell us it's governance. And, spend it they do, in large amounts. How can government increase education funding? Simple – choose to do it. Reducing some of its own bloat and corruption would find some. Diverting funds from spending they deemed a lower priority would find more. There is almost no end to the money government can find, for the projects they want to fund.

Over the last decade, education has represented a diminishing piece of the government's budgetary pie. In recent budgets, funding to private schools – they prefer to be called independent schools because that evokes a different perception – has increased while public funding has not. Seems to me these actions speak to government's desire to fund public education, not its ability. To find more money, all they need do is want to fund education more than they want to fund something else.

All of the above reflects what I think as a teacher to the issues and questions I hear most frequently. The most important hat I wear however is the one of parent. What hits home for me, more than everything else, is concern for the experiences of my six-year-old daughter and eight-year-old son as they move through the public education system. As their classes become larger, populated by a more challenging diversity of students and managed by teachers with fewer resources, how can their education be as good as it can be? Or as it should be? Shouldn't our expectation and aspiration be that our children receive a better education than we did? Do any of you as parents think our schools serve your kids better now or even as well as they did when you were their age?

I sat down to write this piece, unsure who my audience was but knowing I hold a lot of anger about a range of topics towards a variety of people responsible for the climate of the school I call my workplace. In determining to whom I address this essay, I've come to realize the loudest voice who could affect the most change and who is the least heard from, is you, the parents. It's your kids who experience the effects of larger classes, filled with diverse, under-supported kids. It's you who have to shell out from your pocket as school districts download funding shortfalls through school fees, particularly at the high school level. Why do they do it? Because we as parents and more importantly as voters let them.

If our education system in BC is not broken already, it is breaking. The Liberals may not have started the decline, but it has been their job for more than a decade to fix it. The job they've done fixing it has twice resulted in the courts telling them to change their approach and to respect the Canadian Charter of Rights and Freedoms.

As they say, third time lucky, so to the surprise of no one, in an effort to avoid spending tax dollars they claim not to have, the provincial government will spend tax dollars they don't need for other things appealing again the court's decision. I refer to my previous thoughts on budgetary priorities.

I do wonder when the Ministry of Education will update the BC Social Studies Curriculum to reflect the suggestive nature of the Charter. It has apparently become a collection of guidelines, open to inconsistent application, depending on whether it supports or inhibits your desired actions. That is, if you're a provincial government. For individuals like us, probably not so much. Something tells me the ability to cherry pick the laws we like and will follow does not exist.

As I said previously, I also take issue with some of my union's decisions. The vast majority of teachers though are good people, who teach for the right reasons and who work much harder and longer than many realize. Teachers play a vital role in shaping our next generation, or, at least, they try to. Granted, just as every bushel has its bad apples, not every teacher should be in the profession. Not everyone is well-suited to it. But, that's true of every workforce, including politicians.

Our province is devoid of leadership. G. Elijah Dann, a professor at SFU, put it far more eloquently than I can. The following is an excerpt taken from an open letter he wrote to Christy Clark on the topic of the proposed development of the LNG sector in BC.

"As our premier, shouldn't you instead be pursuing a vision for a future that has everyone excited and wanting to work together? Where British Columbians aren't set against each other in an entrenched battle, but rather feel a bright optimism for our immediate future, and also for our children and their children to come? We even believe we can make money at it – but in a way that is sustainable. And ethical.
Shouldn't you, as a provincial leader – like any other leader who has changed the world for good – seek to challenge your fellow citizens to see beyond the simple solutions?"

When I read his letter, this part struck me because he could just as easily have been talking about healthcare, or the forest sector, or fisheries, or . . . minus the part about making money, education or the Ministry of Children and Family Development. How many of you are proud to live in the province that leads the country in child poverty and who funds education below the national average? This, with a government who repeatedly states their first priority is the safety and education of children. At least we have Family Day in February . . .

In a May 27th, 2014 article, Camille Bains of the Canadian Press quotes Christy Clark as saying:

"The strike is going to end at some point. It always does. But after 30 years, for heaven's sakes, we need to find a new way to do it."

I'm not sure who the "we" in her statement is. One of the sides in these negotiations is BCPSEA, who negotiates at the government's behest, following their direction. The premier is frustrated by a process she says doesn't work, that involves an agent of the government, a government of which she is the leader. So if she as premier can't direct her own bargaining agent, what good is she as premier? Either she's as inept and ineffectual as her statement implies, or BCPSEA is doing exactly what she wants done. Neither possibility bodes well for the future of our province's education system.

What about Christy Clark the parent? Politicians routinely laud our education system as being world-class. Foreign students spend significant money for the privilege of attending our schools. Other jurisdictions come to study our curriculum and often purchase it for their own use. The claim from on high is that our public system is top notch, providing excellent education. It is so good, the premier sends her son to . . . a private school? Maybe it's just more convenient, closer to where he lives. Maybe it's because he has a smaller class, more resources and fewer students with special needs in the room. Who can say?

Personally, I think it shows her taking no responsibility for the current situation in our public schools. Granted, her son does not attend one, so she doesn’t have any vested interest in the health of the public system. Well, apart from the fact she is the leader of our province's governing party. Make no mistake, as a parent, she has every right to do as she sees fit and to select the school she thinks best, as she should, as every parent should. She has the means and believes private school is a better option. As a mother, her responsibility is to do what is right for her child.

But, mother isn't the only role she plays. As premier, her responsibility is to do what is right for all kids, including mine. I am confident she is not doing so and I question whether she even thinks she has an obligation to. I think it sends a questionable message at best for anyone in charge of a public system to use the private alternative themselves, be it education or any other field. If the public system is broken to the point the Premier won't use it, as leader of the government responsible for it, she should set about fixing the system, rather than dismantling it to justify her choice to access the private system. If only school kids could vote, maybe then she'd concern herself with their needs.

So what do I do for a living? I am a teacher. I became a teacher in part because it suited my interests and my skill set. The most important reason I did though is that I like working with kids. I truly enjoy seeing that moment when one of my students makes a connection, the light bulb goes off and they understand something they didn't the moment before. Contrary to the belief of some, I did not become a teacher for the unimaginable wealth, which is fortunate because the last ten years have proven I either don't know what wealth is or at the least have no idea where to find it. Neither possibility bodes well for my future, financially at least.

Admittedly, my closing may help perpetuate the myth I'm only in it for the money, but the dollars and cents seem to be the only factor in this dispute that gets any coverage. I started with a question; I'll end with two more.

If I presented you a professional who holds three university degrees, one a masters, a variety of professional development certificates and has 22 years' experience, what would you say that person should expect to earn in salary? If I told you that professional is a teacher, would your answer change?

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Tuesday, June 10, 2014

Conflict of interest. Wazzat?

When football coach Jerry Sandusky recruited, groomed and molested boys, he continued for years because people around him stayed quiet. In 2009, Sara Ganim, then a 22-year-old writer for a small newspaper, sussed the importance of rumours involving the Penn State icon. Three years later Sandusky faced 30 to 60 years in prison and Ganim held a Pulitzer Prize. For the investigative reporter, it was not an easy path; she suffered frequent harassment.

Exceptional journalism requires courage, dedication and, sometimes, outrage. Perhaps as much as anything, a sense of right and wrong is the driving motivation. Seldom does a desire for financial reward stand behind a great story but, too often, cupidity is an effective barrier to reporting that serves the public interest.

In British Columbia, when political journalists place themselves in conflicts of interest by taking payments from groups with interests in the issues covered, they cannot report on conflicts of others. That might explain why you will not read elsewhere that the Labour Relations Board Vice-Chair Richard Longpre, who issued a decision favourable to the government side of the teacher dispute, suffers an obvious conflict. He had been at the centre of the class composition issue as Assistant Deputy Minister of Labour, when Gordon Campbell was Premier and Christy Clark the Minister of Education.

In comments on the article Delay, legislate, litigate, repeat, a reader asked if the LRB decision might have been "tampered with" in the common BC Liberals' style. When I examined Longpre's background, it was apparent that most of his consulting work has been on the employer's side of labour disputes. That didn't surprise but I was taken aback to find that in 2002, he was Assistant Deputy Minister of the Labour Department and very involved in issues that are the core of the Liberal's 13-year long dispute with teachers.

After the June 2002 resignation of a second arbitrator appointed to remove provisions of teachers' contracts, The Province newspaper reported,
"We have to get someone else and we have to move quickly," [Richard] Longpre [B.C.'s assistant deputy labour minister], said. "It's in everybody's best interests to know the terms of the collective agreements when they go back to work in September."
My response to the reader's comment on the earlier article is worth prominence.
The recent decision of the LRB was by Richard Longpre. He was first appointed to the LRB in 1985 by Bill Bennett's Social Credit Government (Labour Minister Terry Segarty). From an old LRB report,
"Richard Longpre graduated from the University of British Columbia in 1976
with a Bachelor of Commerce Degree, majoring. in industrial relations. He
joined Noranda Mines Limited where over the next four years he negotiated
collective agreements and co-ordinated labour relations policy amongst the
Noranda Group of companies in Ontario, the Prairies and British Columbia. In
1981, Mr. Longpre -joined the Mediation Services Branch of the Ministry of
Labour as a mediator. After three years with the Branch, he set up an
independent labour arbitration and mediation practice. In June 1985, he was
appointed Vice Chair of the Labour Relations Board of B.C. and has subsequently
held the positions of Vice Chair with the Industrial Relations Council and
Vice Chair with the current Board. Mr· Longpre resigned as a Vice Chair
effective May 31, 1996; however, he continued to serve on a part-time basis
until September 30, 1996.
It seems Longpre left Noranda, which was involved in potash, oil and gas, mining, etc. and joined BC's Labour Ministry about the time Noranda took control of giant BC forestry company MacMillan Bloedel.

In 1992. the Canadian Film and Television Producers Association hired Richard Longpre to serve as its new vice-president of labor relations for the B.C. branch.

In 2001, Longpre became Labour Minister Graham Bruce's Assistant Deputy Minister. As Liberal ADM, he handled the strange situation in 2002 that saw appointments of a number of arbitrators in the class composition dispute. The final arbitrator that the Labour Ministry appointed in this matter (they discarded the usual practice of parties jointly agreeing on arbitrator selection) was Eric Rice. He did the what the government wanted but his work was tossed by the BCSC in early 2004.

In 2005, Longpre was back in the private sector as a consultant. He worked for trucking companies in a dispute with container truck drivers and for private health services company Sodexho. In 2006, he negotiated for Securiguard in a dispute with airport guards.

Public Accounts records list payments to Longpre FY's 2011,2012 and 2013 as an OIC appointment. Current LRB records show him earning $155,000 as one of five Vice-Chairs of the seven-person LRB.

Considering Longpre's close involvement as Assistant Deputy Minister with the early days of this lengthy dispute, many people would think him the least credible member of the LRB to have acted on the file in 2014. However, as I wrote in the main article, this government has never been concerned about equity in this matter.

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Monday, June 9, 2014

Numbed by numbers

I'll be talking with Ian Jessop, Monday June 9, on CFAX1070. While the BC Government lays seige to public education, it seems a good time to see if all the cupboards are bare, or just the ones that might improve learning conditions in classrooms.

BC teachers claim they are paid 11th best of 13 provinces and territories. I think it is always worth comparing salaries paid in BC to those paid elsewhere so I've done a little comparison in other sectors. Some of the information I've discovered:

In 2012, almost 300 people working in local governments earned over $160,000. Using municipal populations, I calculated the number of residents for each person earning over that amount. West Vancouver's number is worst; Surrey's is best. The Greater Vancouver Numbers are even worse than they seem because the regional district, Metro Vancouver, and Translink have 48 people earning above $160,000.

By comparison, recent British reports revealed the UK government, serving a population 14x that of BC, has 800 public servants earning over £100,000 (equivalent to $160,000). In this province, the number of people working for government and government agencies who earn more than that threshold number almost 3,000.

There are well more than 100 senior public servants in BC earning more than the highest paid civil servant in the United Kingdom.

Click here for other material about the British Columbia Investment Management Corporation.

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Sunday, June 8, 2014

Delay, legislate, litigate, repeat

Reasons for Judgment, Madam Justice S. Griffin, January 2014

The hearing before this Court follows on the Court's declaration on April 13, 2011 that legislation interfering with teachers' collective bargaining rights was unconstitutional as a breach of s. 2(d) of the Canadian Charter of Rights and Freedoms, which guarantees freedom of association. 

The legislation at issue deleted collective agreement terms and prohibited collective bargaining having to do with a range of working conditions, many having to do with class size and composition and the number of supports provided in classes to students with special needs.

The freedom of workers to associate has long been recognized internationally and in Canada as an important aspect of a fair and democratic society.  Collective action by workers helps protect individuals from unfairness in one of the most fundamental aspects of their lives, their employment. 

Normally the result after legislation is determined by a court to be unconstitutional is that it is struck down.  This is part of Canada's democratic structure, which requires that governments must act legally, within the supreme law of the country, the Constitution.

Here this result was suspended for twelve months to give the government time to address the repercussions of the decision. 

The government did not appeal.

After the twelve months expired, the government enacted virtually identical legislation in Bill 22, with the duplicative provisions coming into force on April 14, 2012. 

The over-arching question, then, is whether there is something new that makes the new legislation constitutional when the previous legislation was not.

The government argues there are two new facts that make the new legislation constitutional.

First, the government argues that its "good faith consultation" with the union after the first court decision declaring legislation to be unconstitutional, essentially immunized the subsequent duplicative legislation from a similar constitutional challenge.  This Court concludes otherwise.  The government discussions with the union did not cure the unconstitutionality of the legislation.

The Court has concluded that the government did not negotiate in good faith with the union after the Bill 28 Decision.  One of the problems was that the government representatives were pre-occupied by another strategy.  Their strategy was to put such pressure on the union that it would provoke a strike by the union.  The government representatives thought this would give government the opportunity to gain political support for imposing legislation on the union.  

The second argument by the government is that the new legislation has a critical difference from the otherwise identical legislation found to be unconstitutional, and that is that one of the two branches of the legislation was time limited. 

There were two branches to the Bill 28 legislation previously declared unconstitutional.  One was a deletion of existing terms in the collective agreement and a prohibition on including terms in the collective agreement in the future regarding these working conditions.  The second was a prohibition on collective bargaining over certain working conditions. 

The government argues that there is a crucial difference between the Bill 22 package of legislation and the earlier legislation declared unconstitutional, in that in Bill 22 it temporally limited the second branch of the legislation:  the continued prohibition on collective bargaining about the working conditions terms was extended until the end of June 2013 and then repealed. 

However, in Bill 22 the government re-enacted legislation identical to that first branch of what was previously declared unconstitutional, namely, the deletion and prohibition of hundreds of collective agreement terms on working conditions.

The Court concludes that there is no basis for distinguishing the new legislation from the previous findings of this Court.  The new duplicative legislation substantially interferes with the s. 2(d) Charter rights of teachers, which protects their freedom to associate to make representations to their employer and have the employer consider them in good faith.

As a result, the Court finds the duplicative legislation in Bill 22 to be unconstitutional, namely s. 8, part of s. 13, and s. 24, set out in Appendix A.  The unconstitutional provisions that have not already expired, ss. 8 and 24, are struck down.

When legislation is struck down as unconstitutional, it means it was never valid, from the date of its enactment.  This means that the legislatively deleted terms in the teachers' collective agreement have been restored retroactively and can also be the subject of future bargaining. 

Striking down the unconstitutional legislation will have implications for teachers and their employers but both sides will have interests in resolving these implications through collective bargaining and the tools already existing to resolve labour disputes.

The Court has also concluded that it is appropriate and just to award damages against the government pursuant to s. 24(1) of the Charter.  This is in order to provide an effective remedy in relation to the government's unlawful action in extending the unconstitutional prohibitions on collective bargaining to the end of June 2013.  The government must pay the BCTF damages of $2 million…

In The Court of Appeal for British Columbia, February 2014, acting in Chambers, Mr. Justice Harris stayed Justice Griffin's judgment, pending an appeal. Harris did not consider the merits of the province's appeal.

From the beginning of its dispute with teachers, Liberal government actions showed contempt for equity. In the first year of its first term, according to Justice Griffin, while the BCTF and BC Public School Employers (BCPSEA) negotiated, the ministry of education was consulting with BCPSEA "on potential legislative changes that could reduce the scope of collective bargaining. BCTF was not consulted about the potential legislation."

When negotiations failed, as they were almost bound to do with conflicting action behind the scenes, the BC Liberal government passed Bills 27 & 28. BCTF began a legal challenge in May 2002. Bill 28 required the appointment of an arbitrator to review the collective agreement, determine what provisions had to be removed, and then remove them. After the first three arbitrators resigned, the fourth arbitrator dismissed BCTF objections and deleted extensive provisions in the collective agreement. Soon after, the Supreme Court quashed the arbitrator's decision. Within a year, federal Liberals made the fourth arbitrator, lawyer Eric Rice, a judge of the BC Supreme Court.

In 2004, Liberals passed the Amendment Act, which effectively restored the arbitrator's decision by deleting all sections of the collective agreement the arbitrator had deleted. The fight has continued ever since, with delay after delay, precipitated by government tactics.

In 2011, Justice Griffin wrote extensive reasons for judgment in which she ruled provincial legislation to be unconstitutional interference with teachers' rights. The court declaration was suspended for a year to allow the government time to address the repercussions of this decision. Their response was to pass another law that was essentially the same.

That resulted in a new court case and another trial like the one that ended in 2011. Surprising absolutely no one, the subsequent case was decided in favour of the BCTF, as noted above.

Millions of dollars enriched numerous lawyers, the Supreme Court repeatedly ruled against the BC Liberals, yet nothing is resolved after a dispute of 12 years. One side has sufficient control and financial resources that it can ensure the court process moves at a pace that would make a tired snail impatient. Despite repeated losses in courtrooms, government has continued on the same course it still follows. It prefers the status quo; conflict with teachers serves its anti-labour philosophy and Liberals calculate it helps them politically.

In addition to squadrons of lawyers billing taxpayers between $500 and $1,500 an hour, Liberals employ spin masters and social media trolls tasked with demonizing the very profession that may matter most to the success of future generations.

The Supreme Court of Canada must act to stop governments from stalling single issues in an endless cycle of delay, legislation, litigation and re-legislation. This current top court might do that, bringing Harper's Government to regret disrespecting the Chief Justice. Particularly, if as it seems on the prostitution issue, Harper's minions rely on circular reintroduction of unacceptable laws as Clark's government has done.

In his recent column, Andrew Coyne described a situation that Chief Justice Beverley McLachlin's court may deal with soon.

"The prostitution bill. The Supreme Court having tossed out the old laws as a violation of prostitutes' constitutional right not to be beaten or murdered (I paraphrase), it was expected the government would opt for the "Nordic model," criminalizing the purchase of sex rather than the sale, as a replacement — a contentious but tenable response to the Court's decision. It was not expected it would, in effect, fling the ruling back in the Court's face. Not content with leaving the impugned provisions, but for a few cosmetic changes, essentially intact, the government imposed new restrictions, for example banning prostitutes from advertising: not just in violation of the Constitution, it would seem, but in defiance of it. The bill is written as if calculated to provoke another confrontation with the Court, ideally in time for the next election."

Inappropriate actions when elected officials respond to court declarations are startling. In these cases, attitudes of extreme arrogance convince politicians they are above rules that apply to others. David Owen, a British ex-cabinet minister trained in psychiatry, described symptoms of hubris syndrome:

• A narcissistic propensity to see one's world primarily as an arena in which to exercise power and seek glory

• A disproportionate concern with image and presentation

• A messianic manner

• Excessive confidence in own judgment and contempt for advice

• Exaggerated self-belief, bordering on omnipotence

• A belief that one is accountable solely to history or god

• Loss of contact with reality; often associated with progressive isolation

• Restlessness, recklessness and impulsiveness

Owen admits that while in the theatre of national politics, he suffered a tendency to hubris and believes the syndrome affects many modern leaders. In most activities, particularly private life, checks and balances constrain our behaviour. If we live outside generally accepted rules of conduct, there are prices to pay. Literally, there's a heavy price to pay if you are on the losing end of successive legal actions. Christy Clark and Stephen Harper are not so constrained.

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Saturday, June 7, 2014

A system guaranteed to fail

I grumble about the quality of political journalism hereabouts and these complaints seem justified, even urgent, when an Ontario pundit demonstrates an example of powerful advocacy for the public interest. Andrew Coyne may be at the height of a career that has always had him near Canada's centres of power. Friday, his National Post column is 'We once had to wait weeks for a new Harper abuse of power. Now we're getting them two or three a day'

Obviously, Coyne has Prime Minister Stephen Harper and the Conservatives in his sights:

"…Several themes run throughout these: a contempt for civil liberties, for due process, for established convention, for consultation, for openness, replaced throughout by a culture of secrecy, control, expedience and partisan advantage. Worse, there is virtually nothing anyone can do about it. All governments have displayed some of these traits. If this government has pushed things rather further, it is because it can: because we have so centralized power in the Prime Minister's Office, with so few constraints or countervailing powers.

"Where this has lately come to a head is in the appointments process. For in Canada, uniquely, the prime minister's powers of appointments extend not only to all who serve beneath him, but to every one of the offices that might be expected to hold him in check. He appoints the Governor General, all the senators, and every member of the Supreme Court; the governor of the Bank of Canada, all the deputy ministers, and every Crown corporation president; the top military officers, the heads of the security services, and the commissioner of the RCMP; plus all of the officers of Parliament I've mentioned and several more besides. And those are in addition to the already vast powers of appointment with which he rules over members of Parliament: not only cabinet, but all the parliamentary secretaries and all the committee chairs as well…"

I urge you to follow the link above and read Coyne's entire item. All should consider it because he focuses on a major defect that is present in Ottawa today and in most provincial capitals. The old Canadian system of responsible parliamentary government decayed and was replaced by a near-presidential style but with few checks and balances and no term limits. Without debate and through no considered plan, we combined elements of two kinds of government and built a new style worse than either.

Self-serving people who admire autocracies designed Canada's present governments. Harper is himself Ottawa's lead autocrat whereas Christy Clark is more the puppet of unseen forces. Both are in positions that appeal to and attract narcissists, who, according to Malcolm Gladwell, make the worst managers. However, power resides in one office and all party members pay obeisance or suffer expulsion.

Leaders stand at the top of the ladders and employ agents to control who can mount the bottom rung. It is a system guaranteed to fail.

Read: Stephen Harper: the Scary Madness and the Dangerous Denial

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Thursday, June 5, 2014

Losing the news

Pulitzer Prize winner Alex Jones wrote the 2009 book Losing the News: The Future of the News That Feeds Democracy. In it, he examines "authentic journalistic objectivity" and finds "a crisis of diminishing quantity and quality, of morale and sense of mission, of values and leadership."

A few excerpts:

"Objectivity means not trying to create the illusion of fairness by letting advocates pretend in your journalism that there is a debate about the facts when the weight of truth is clear. He-said/she-said reporting, which just pits one voice against another, has become the discredited face of objectivity. But that is not authentic objectivity.

"…objectivity does not require that journalists be blank slates free of bias. In fact, objectivity is necessary precisely because they are biased.

"It was because journalists inevitably arrived with bias that they needed objectivity as a discipline to test that bias against the evidence so as to produce journalism that would be closer to truth.

"[If news] is viewed as just another collection of facts assembled by someone with a political agenda, then one of the most important supports for our democracy will weaken, and the conversation may well become more of a cacophonous Tower of Babel."

In Canada, some reporters and commentators gain more benefits by entertaining special interest groups than they can earn from authentic journalism. For the busiest of BC's pundit entertainers, appearance fees offer greater rewards than writing or broadcasting. He's not appearing in front of the Kiwanis Club of Langley or Frog Hollow Neighbourhood House; those organization cannot afford the cost.

Were the situation confined to one media star, I would not be alarmed. However, it does not. Even the newlywed and nearly dead of journalism are in the hunt for appearance fees. Many are successful and rewards keep them from thinking about what they offer in return. As I wrote in an earlier article, apparently the sellers do not know what they are selling. On the other hand, maybe that is just something they do not want to know: a spoonful of ignorance helps the money go down.

Pandering to personal commercial interests results in media persons losing their cloaks of objectivity. And, they must pander because the moneyed crowd does not pay fat fees to entertainers who offend them. Journalistic codes of ethics seem clear but have limited value. The RTDNA created "ethical guidelines for journalists to reference." One states, "journalists will not accept financial compensation from those who seek to influence news coverage." However, journalists are not required to follow the guidelines; they can simply reference them.

In following media coverage of the government-teacher dispute, I noticed a number of pro-media types seem more interested in promoting the talking points of one side and providing surrender advice to the other. A review of Thursday's Twitter messages by Baldrey, Mason and Palmer showed them focused on the education dispute. Of 32 Tweets, 28 were on the subject, nearly all repeating claimed weaknesses or difficulties faced by teachers. Their social media contributions paint them as employer partisans in the labour dispute, not reporters.

This behaviour is typical of journalism in BC. We see repetition of government claims about natural gas. However, only in this modest blog will you find evidence than little new money found its way into the public treasury from the last three years of gas industry activity. Nor will you find pro-media reporting that the proposed Howe Sound LNG plant expects to buy power for $80 million a year less than BC Hydro pays to acquire the same quantity from private power projects.

The corporate media does not report what was shown here yesterday: that BC is exporting 12 times the timber that it shipped abroad 20 years ago for half the revenue per cubic metre of wood. There is no exploration by pro-media journalists about how and why this came to be.

Is it accidental that BC's special interest groups gain special treatment or avoid scrutiny? Well, if you pay me $5,000 to attend your next dinner meeting, I'll give you the answer, or, at least, an answer. I'll even throw in an amusing anecdote or two.

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Why have our trees lost half their value?

BC Stats released an updated report 'British Columbia Origin Log Exports' and I extracted data to produce these graphs. The statistics show the volume of raw logs leaving the province continues at record levels. This demonstrates the average monthly volume of exports over time.

I've written much about the subject of log exports. Click here and scroll through the various articles. The quantities, loaded mostly on ships bound for Asia, tell one part of the story but there is another important trend line and it's one that points in a different direction.

Using the Bank of Canada inflation calculator, I converted the dollars reported by BC Stats to 2013 equivalents. As a result, the second graph shows the average unit values realized over 20 years. During that period, the worth of a cubic metre of exported timber has dropped to about half the starting point. There is no single reason that explains this change but one relates to a problem that faces most modern states. Global businesses tends to arrange affairs to realize profits in jurisdictions where tax obligations are least.

Tax auditors regularly address abuses related to transfer pricing. It is a complicated matter that may see outgunned tax officials facing corporate officials backed by highly paid consultants. With respect to log exports, value is not merely a function of volume. Species, condition, end use and other factors influence value.

In the words of one accounting paper,
"Transfer pricing practices are responsive to opportunities for determining values in ways that are consequential for enhancing private gains, and thereby contributing to relative social impoverishment, by avoiding the payment of public taxes."
In British Columbia, the 14 year long campaign to reduce "red-tape" has achieved one particular thing. Reducing the size of government has also reduced government's capacity to ensure that organizations exploiting natural resources are paying a fair share for those public assets. The BC Liberal government has ensured that capacity is inadequate.

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Plus ça change, plus c'est la même chose

A reader reminded me of this piece from March, 2012. Unfortunately, it seem to be relevant today.

I grew up informed and amused by Vancouver's great editorial cartoonists Len Norris and Roy Peterson. At home, there is an original Norris on the wall, purchased at a 1981 elementary school fundraiser that benefited from the artist's generosity during another time of restraint in public education.

Browsing through works at The Simon Fraser University Library Editorial Cartoons Collection is a favourite pastime. This irreplaceable library contains over 9300 original drawings published in Canadian newspapers between 1952 and the present. Beyond Norris and Peterson, you will find other great Canadian artists, including Bierman, Harrop, Krieger, Murphy, Olson, Raeside and others.

To prove the title of this blog post, I offer one of Len Norris' cartoons from March 1954:

"... lately there's been some criticism of frills in schools, and I understand Grade II keeps a goldfish and a pair of rabbits ..." 

Political cartoons can be timeless. Ethan Georges Rabidoux in The power of political cartoons, published in the Toronto Star, provides evidence of their potential clout.
“Stop them damn pictures! I don’t care so much what the papers write about me. My constituents can’t read. But, damn it, they can see pictures.”
William Magear Tweed understood the power of a cartoonist’s pen. Tweed was a wealthy New York politician during the 1870s and a character in the 2002 movie Gangs of New York. He was also the target of vociferous attacks by Bavarian-born cartoonist Thomas Nast when he made this statement.

Tweed and his acolytes at Tammany Hall stole between 40 million and 200 million tax dollars in their day (between $1.5 billion and $8 billion today when adjusted for inflation). The New York Times ran a story detailing their graft. The public never caught on until Nast’s political cartoons brought the information to the commoners in a language they understood. Tweed was convicted of larceny and spent the rest of his days in prison. It could not have been done without Nast’s work. The powerful were brought to their knees when their corruption was exposed through cartoons.
Thomas Nast, Who Stole the People's Money? Cartoon showing
William TweedPeter SweeneyRichard Connolly and Oakley
Hall that appeared in 
Harper's Weekly (19th August, 1871)

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Tuesday, June 3, 2014

We Won

The title refers to BC's 2013 election. It was stated by a "Proud American." When he said that, Krishnan Suthanthiran did not mean that citizens of the province were victors. More about that follows.

In 2012, federal cabinet minister Joe Oliver, then chief supplicant to Canada's fossil fuel industry, complained that opponents use funding from "foreign special interest groups" to achieve their "radical ideological agenda." It was a strange comment from a government that promotes untrammelled development of what Maclean's Magazine called "Our Chinese oil sands."

The fossil fuel industry's noise machine quickly added to Oliver's claims and CRA tax auditors moved to silence environmental groups. However, Canada's Conservatives have an inconsistent view about foreigners entering political debates. In May, the Globe and Mail's Eric Reguly wrote Canada’s $207,000 oil sands ad: Putting a price on deception,
"The ad in The New Yorker is pretty, if not quite arresting. The full-page photo on the inside back cover – prime real estate in the United States’ leading upmarket magazine – features a pristine river meandering through a lush mountain valley, untouched by humanity. It is not a tourism ad. It is designed to convince influential Americans that the Keystone XL pipeline is environmentally safe, even desirable.

"What is clever about the ad is not the photo; it is the headline and the succinct lines of copy beneath it. They are slick pieces of propaganda... But this ad is unconscionable because you, the Canadian taxpayer, paid for it. The rate for a full-page ad in that location, according to Condé Nast, publisher of The New Yorker, is $207,000 (U.S.)..."
Long ago, the fossil fuel business learned that when dealing for valuable public assets, the industry could first spend a little to acquire politicians. Returns on those investments may seem unconscionable to us but they are routine for the people on both sides of the bargain. Not just natural resources are in play. A secondary objective is to have taxpayers dollars spent on furthering industrial interests. The costly New Yorker ad, part of Canada's $25 million campaign in both Europe and the USA, is one example.

The recent LNG in BC conference is another. BC Liberals will not fund public schools properly but they will spend heavily for an industry that has largely stopped making deposits to BC's tax collection accounts. (As demonstrated elsewhere on this blog, unrecorded credits owed producers exceed natural gas royalties received in the last three years.)

Industrialists have been and will be the beneficiaries of resource policies but it is not entirely a one-way street. As always, one hand washes the other. After LNG in BC, someone sent me a six-page billet-doux to the Liberals that was distributed on the floor of the taxpayer-funded conference. It is by Krishnan Suthanthiran, a self-described American-Indian businessperson who aims for a piece of the action if a sufficiently subsidized LNG industry proceeds. That is uncertain, given the scale of demands by Asian energy companies who are promoting competition between Canada, Russia, Australia and other suppliers, but, even if it does not, Suthanthiran has other plans for the former mining town of Kitsault, BC. He needs provincial support for that so, one way or another, hand washing helps.

However, the Proud American's convention contribution is cringe worthy, the kind of sycophancy one might expect north of Korea's 38th parallel. However, as the $11 million Bollywood party demonstrated, Liberals know no boundaries when it comes to celebrating themselves. Or in rewarding friends.

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Austerity is limited

School districts are forced to economize and they've done it in many ways. However, despite squeezing operating budgets so hard that supplies of classroom paper run out, certain costs are sticky downward. Utility costs and carbon taxes are but two examples. The compensation report from one school district might demonstrate another.

School District Salaries

I find the vacation payouts rather strange. Auditors shudder when senior officials take cash instead of vacations. It is subject to abuse because the people who keep track of days the bosses are absent are people who report to the bosses. Additionally, good internal controls require mandatory vacations for managers and not just a few days here and there. It is part of fraud control.

Another costly entitlement among senior public servants in this province results in the supplementary pensions that are downright lucrative when compared to pensions enjoyed by the vast majority of people employed in BC. Not only do these pensions call for significant employer contributions, uncapped by limits on annual pensionable earnings as most civil servants experience, but they are often further supplemented by substantial "retirement allowances."

Even worse, some individuals move from one public or quasi-public employer to another and qualify for multiple pensions in short periods of time. These lucky folks walk into their sunset age receiving far more than they earned during the best years of employment. By no coincidence, the senior managers who make the rules of compensation tend to be also the beneficiaries of the rules.

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