Saturday Morning Links

Assorted content for your weekend reading.

- Joseph Stiglitz writes that while we should expect natural resources to result in broad-based prosperity, Australia (much like Canada) is now turning toward the U.S. model of instead directing as much shared wealth as possible toward the privileged few:

There is something deeply ironic about Abbott’s reverence for the American model in defending many of his government’s proposed “reforms.” After all, America’s economic model has not been working for most Americans. Median income in the US is lower today than it was a quarter-century ago – not because productivity has been stagnating, but because wages have.

The Australian model has performed far better. Indeed, Australia is one of the few commodity-based economies that has not suffered from the natural-resource curse. Prosperity has been relatively widely shared. Median household income has grown at an average annual rate above 3% in the last decades – almost twice the OECD average.

To be sure, given its abundance of natural resources, Australia should have far greater equality than it does. After all, a country’s natural resources should belong to all of its people, and the “rents” that they generate provide a source of revenue that could be used to reduce inequality. And taxing natural-resource rents at high rates does not cause the adverse consequences that follow from taxing savings or work (reserves of iron ore and natural gas cannot move to another country to avoid taxation). But Australia’s Gini coefficient, a standard measure of inequality, is one-third higher than that of Norway, a resource-rich country that has done a particularly good job of managing its wealth for the benefit of all citizens.

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Australia should be proud of its successes, from which the rest of the world can learn a great deal. It would be a shame if a misunderstanding of what has happened in the US, combined with a strong dose of ideology, caused its leaders to fix what is not broken.   

- Meanwhile, Julian Beltrame reports that Canada's combination of corporate tax giveaways and gutting regulations has done nothing to change stagnant business investment. (Though as Armine Yalnizyan notes, that's sadly accompanied by the C.D. Howe Institute insisting on more of the same failed corporatist policies.) Don Pittis writes that stagnant wages are leaving Canadian workers with nothing to show for economic growth. And Dennis Howlett's mild optimism about Ontario's single-year budget is more than outweighed by his recognition that Ontarians are far worse off for decades of austerity and tax slashing:

For years now, Ontario governments (both Liberal and Progressive Conservative) have been inflicting austerity policies while failing to comprehensively collect revenue from large corporations and the wealthy. This sloppy fiscal management persisted - long after it was obvious that it just doesn't work.

Cuts to public services have caused a lot of pain and not much gain in terms of reducing deficits. Those cuts also boosted unemployment, slowed economic recovery and reduced tax revenue.

We can no longer afford the steep price tag that comes with avoiding revenue side solutions. Governments need to be clear about the real costs of tax cuts and loopholes.
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After so much tax cutting, Ontario kick starting a $1 billion reversal is a pretty small step. But it is a step in the right direction. But further steps in this direction are needed in the next budget, including possibly some modest but broader income tax increases.

There's a caveat though.

Boosting taxes on the rich and on corporations will not result in more revenue if governments don't close tax loopholes and take stronger measures to go after tax cheats. On this front too, though there were some encouraging words in the Ontario budget:

"Reducing corporate tax avoidance and closing tax loopholes is a priority for the Ontario government. The government supports the principle that everyone should pay their fair share of taxes, including corporations."

Word is that Ontario government will be pushing the federal government and the Canada Revenue Agency to step up their efforts. This is welcome news. Each and every Canadian province loses revenue from corporate tax avoidance schemes that take advantage of tax loopholes and offshore tax havens. It is time for a strong stand by all provinces at the premiers meeting scheduled for August. They can no longer avoid tackling what has become a chronic problem.

- Stephan Lefebvre points out how yet another set of free-trade spin is based on flat-out lies about the effect of NAFTA.

- Ethel Tungohan highlights the absurdity of the Cons' temporary foreign worker tinkering which does nothing at all to help actual workers of any kind:

If Kenney and Alexander truly want to protect temporary foreign workers from abuse, they would include robust measures that take into account the reality of these workers’ lives.

Workplace audits should be accompanied by a guarantee that abused temporary foreign workers will not be deported and will be given jobs in other companies for the duration of their stay in Canada.

Temporary foreign workers should be given open work permits that tie them to a specific industry, but not to a specific employer to mitigate abuse.

And, most importantly, the Canadian government should recognize that temporary foreign workers provide important economic contributions to Canada. Like other immigrants, they come to provide for themselves and their families. They should be provided pathways to Canadian citizenship.

If they are good enough to work, they are good enough to stay.

- Finally, today is another NDP Day of Action - this time focusing on climate change to celebrate Jack Layton's birthday. You can search for an event here - and I'll point out my home riding's canvass and barbecue in particular for anybody in Regina interested in getting involved.

Musical interlude

Watchmen - All Uncovered

Friday Morning Links

Assorted content to end your week.

- Robert Reich discusses the rise of the non-working rich as an indicator that extreme wealth has less and less to do with merit - as well as the simple policy steps which can reverse the trend:

In reality, most of America’s poor work hard, often in two or more jobs.

The real non-workers are the wealthy who inherit their fortunes. And their ranks are growing.

In fact, we’re on the cusp of the largest inter-generational wealth transfer in history.

The wealth is coming from those who over the last three decades earned huge amounts on Wall Street, in corporate boardrooms, or as high-tech entrepreneurs.

It’s going to their children, who did nothing except be born into the right family.
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What to do? First, restore the estate tax in full.

Second, eliminate the “stepped-up-basis on death” rule. This obscure tax provision allows heirs to avoid paying capital gains taxes on the increased value of assets accumulated during the life of the deceased. Such untaxed gains account for more than half of the value of estates worth more than $100 million, according to the Center on Budget and Policy Priorities.

Third, institute a wealth tax. We already have an annual wealth tax on homes, the major asset of the middle class. It’s called the property tax. Why not a small annual tax on the value of stocks and bonds, the major assets of the wealthy?

We don’t have to sit by and watch our meritocracy be replaced by a permanent aristocracy, and our democracy be undermined by dynastic wealth. We can and must take action — before it’s too late.

- Meanwhile, Tim Stacey offers his own prescriptions to deal with income inequality. And the Economist looks at the relationship between wealth inequality, income inequality and consumption inequality - and the fact that all three are on the rise, refuting the claim that we shouldn't worry about wealth or income as long as consumer goods are distributed more fairly. 

- James Bloodworth points out that the few gains we've made against corporate greed were won by a strong labour movement. Brian Jones discusses the stagnation of the minimum wage in recent decades when labour has been under attack. And the Mowat Centre reminds us that the precarious federal government has siphoned tens of billions of dollars in EI premiums into general revenues - turning a program intended to benefit workers when they need help most into an excuse to slash taxes for the wealthy.

- Claire Markham sees a U.S. Congressional hearing as a prime example of how not to listen to people living in poverty. (Though not listening to the poor seems to be a widely-held skill on the right.) And Robin Whitaker reminds us why charity isn't enough to deal with social exclusion.

- Finally, Rick Salutin is right to decry the place of bond ratings agencies in trying to wrest control over public policy away from democratically-elected governments. But surely the subprime meltdown in which so many AAA-rated securities turned out to be junk should prevent us from believing for a second that "their sole criterion is the math" - meaning there's reason to doubt that statements about public budgets have anything to do with actual default risks rather than appealing to the financial sector's prejudices.

Thursday Afternoon Links

This and that for your Thursday reading.

- Marc Lee looks in detail at the risks involved in relying on tar sands development as an economic model:

The UK outfit Carbon Tracker was the first to point out this means we are seeing a “carbon bubble” in our financial markets – that  fossil fuel companies, whose business model is the extraction of carbon, are over-valued on the stock markets of the world. This analysis was subsequently picked up by Bill McKibben in his now-famous article, “Global Warming’s Terrifying Math,” which launched the fossil fuel divestment movement, plus some local content by yours truly in a CCPA report called Canada’s Carbon Liabilities.

The latest from Carbon Tracker looks at planned capital investments in oil production around the world (future reports will look at coal and natural gas). These have different costs of extraction, leading to a “carbon supply cost curve” for oil production. Carbon Tracker argues that in a world of constrained carbon, it only makes economic sense that it will be the high cost suppliers that get cut out of the action.

This logic is bad news for Alberta’s tar sands, which are among the highest cost reserves. Using an oil and gas industry database, Carbon Tracker looks at a potential $1.1 trillion of capital expenditure on oil projects between 2014 and 2025 that require a price of at least US$95 per barrel market price ($80 break-even) – i.e. those projects most likely to not go ahead in a carbon-constrained world. They find that a very large share of these projects (nearly 40%) are tar sands projects in Alberta (see Figure 7 in particular).
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For the most part, however, the underlying assumption of Canadian financial markets, including most Canadian pension funds, is that governments of the world will not get their act together, so there is no reason to pull out from fossil fuel investments. Some skepticism that governments will be able to reach a new deal is warranted, but the probability of them doing so is not zero either. But even in the absence of a global treaty, unilateral actions by Canada’s trading partners could impose de facto carbon constraints. Examples include the Keystone XL pipeline and European Fuel Quality directives.

There is a strong possibility that, sooner or later, Canada will be living in a carbon-constrained world, a development that would have significant (and, to date, widely ignored) economic implications. In this context, “responsible resource development” implies strategic management of fossil fuel reserves in order to maximize shared prosperity, within the context of a carbon budget. The good news is that Canadians have been bombarded with several decades of budget talk about “living within our means”  – now we just have to apply that to carbon.

- But Sheila Pratt highlights some more examples of the oil industry trying to buy the public's silence when it comes to questioning unfettered oil exploitation. And the Council of Canadians notes that for now, Canada is instead trying to bully the EU and other international allies into delaying any steps to reduce fossil fuel consumption.

- Meanwhile, Justin Ling writes that yet another trade agreement side-effect - this time arising out of the TPP - looks to be far more intrusive surveillance by the U.S. and other foreign states.

- Joseph Stead reports that the corporate sector is laughing at the UK's honour-system plan to improve corporate accountability. And Julian Beltrame finds that the Cons' tall tales about mythical trade barriers have far more value as entertainment than as policy analysis.

- Finally, Steven Greenhouse writes that the U.S. is finally seeing some legislative efforts to give part-time workers some security and control over their time - including a few ideas along the lines of what I'd proposed for Saskatchewan here.

New column day

Here, on how the recent spate of Saskatchewan women being fired for getting pregnant represents only the tip of the iceberg when it comes to gender inequality.

For further reading...
- The Leader-Post reported on the increase in pregnancy-related firings here. And its editorial board weighs in here.
- Oxfam's report referenced in the column is here (PDF). And again, Shannon Gormley's column on how we project to be a lifetime away from wage equality is worth read.
- Finally, Clive Crook discusses the need for early and consistent social support to end inequality of opportunity.

Wednesday Morning Links

Miscellaneous material for your mid-week reading.

- The New York Times editorial board chimes in on how Kansas serves as an ideal test case as to illusory benefits of top-end tax cuts:

The 2012 cuts were among the largest ever enacted by a state, reducing the top tax bracket by 25 percent and eliminating all taxes on business profits that are reported on individual income returns. (No other state has ever eliminated all taxes on these pass-through businesses.) The cuts were arrogantly promoted by Mr. Brownback with the same disproven theory that Republicans have employed for decades: There will be no loss of revenue because of all the economic growth!

“Our new pro-growth tax policy will be like a shot of adrenaline into the heart of the Kansas economy,” he wrote in 2012. “It will pave the way to the creation of tens of thousands of new jobs, bring tens of thousands of people to Kansas, and help make our state the best place in America to start and grow a small business.”

But the growth didn’t show up. Kansas, in fact, was one of only five states to lose employment over the last six months, while the rest of the country was improving. It has been below the national average in job gains for the three and half years Mr. Brownback has been in office. Average earnings in the state are down since 2012, and so is net growth in the number of registered businesses.

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The evidence of failure is piling up around Mr. Brownback, whose re-election campaign is faltering because of his mistake. Yet he continues to cling to his magical ideology, pleading for more time. “It’s like going through surgery,” he told The Wall Street Journal last month. “It takes a while to heal and get growing afterwards.”

But it’s not clear the patient can recover from this surgery — the reserve fund, in fact, is likely to nearly run dry next year. As Kansas has clearly shown, states cannot cut their way to prosperity. They need to use every tool of government to nurture growth, and those tools require money.

- And in a similar vein, Madhavi Acharya-Tom Yew reports on the growing recognition that Ontario will need some significant revenue increases to avoid the Wynne Libs' plan to sell off and slash public services.

- Meanwhile, Mark Serwotka duly mocks the claim that austerity reflect financial necessity rather than a desire to ensure that a still-expanding pie serves fewer and fewer people. Simon Tremblay-Pepin examines the effect of austerity in Quebec. And PressProgress connects the dots between more active government and happier people.

- Susan Wright discusses Alberta's farce of a climate change strategy - along with the minimal chance that a strong rebuke from the province's Auditor General will result in any change for the better.

- Finally, Dale Smith expands on the vital role played by political parties - and some of the steps needed to make sure they work as they're supposed to:

What people often forget is that parties represent different things in different arenas.  The parliamentary party is a facet that is important in the day-to-day operation of parliament, and serves some of the most crucial functions of all – maintaining confidence.  This is the underlying principle by which our system of Responsible Government operates – that the government of the day has the confidence of the Chamber, so that it can continue to govern.  It maintains confidence by means of arranging its followers into a party that will support it on matters of confidence – things like spending proposals or key government programs and foreign policy decisions.  It also means that the prime minister can continue to advise the Queen or Governor General, because he or she has the confidence of the Chamber.  So you can see why it’s a pretty big deal.
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(I)n order to fix the problems, they require more engagement from people and not less.  The problem when no more than two percent of the population – one of the lowest rates in the democratic world – are members of a political party at any given time, is that it allows a small number of people within the party to exert undue influence.  This applies for things like policy development, candidate selection and nomination races – you need more people engaged, in order to push back against top-down control and to make themselves heard and to hold the party itself to account.
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There is, however, a uniting factor in the problems that plague both the parliamentary and electoral party structures, which is the fact that a lack of civic literacy, combined with a lack of responsibility on the part of both voters and MPs, has created a system where everyone walks around going “not my problem.”  Voters don’t want to engage in parties, and MPs don’t want to claim their rights and responsibilities, seemingly more comfortable blaming others for their lack of action (not to mention backbone).  This was confirmed in the recent book The Tragedy of the Commons, which Delacourt also cited, but to a different conclusion.  What is most striking about that book is the way in which the former MPs that were interviewed were concerned with their own self-mythologizing, insisting that they were all outsiders to the system (almost to a single MP), and that the party made them do everything.  Except that each and every one of them could have said no.

What MPs and voters alike need is a crash course in civic literacy, so that they are armed with the knowledge that is necessary to push back against the power structures that have entrenched themselves in the leaders’ offices and party hierarchies.  You don’t like the way the party elite run things?  Ensure that you have a strong enough grassroots to push back.  You don’t like how the leader’s office treats MPs like puppets?  It only takes a handful of MPs to say no, because they can’t all be fired at once without some serious questions being raised.  All it takes is a little effort.  To simply declare that parties are the problem is facile and wrong, and abolishing them just throws the baby out with the bathwater.

Tuesday Night Cat Blogging

Floored cats.

Tuesday Afternoon Links

This and that for your Tuesday reading.

- Paul Boothe responds to the C.D. Howe Institute's unwarranted bias against public-sector investment:

Is the public sector holding back provincial growth rates by crowding out private sector investment?  That’s the contention of a recent C.D. Howe paper by Philip Cross.  The paper provides a great case study of the danger of confusing correlation with causality.

Let’s begin with the simple arithmetic.  Gross domestic product (GDP) is the sum of spending on consumption, investment, government services and net exports.  Whether the investment spending is initiated by the private sector or the public sector makes no difference to the GDP accountants at Statistics Canada. Both contribute in the same way to measured GDP and a boom in either private or public sector investment will boost economic growth. The simple arithmetic gives us no reason to prefer one kind of investment over the other.
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(T)he four provinces with relatively high private sector investment ratios that Mr. Cross highlights are all energy producers, while the ones with relatively low private sector investment ratios are not.  A simpler alternate hypothesis, dismissed out of hand by Mr. Cross, is that the differences in private sector investment ratios are mainly due to the energy boom.  In fact, when one compares the rates of public sector investment per capita in Alberta and Ontario in 2012, it turns out that they are roughly comparable. Alberta actually has greater public sector investment per capita when one accounts for investment by utilities in the same way across provinces.

Scottish poet Andrew Lang warned about the misuse of statistics, remarking that they are sometime used like a drunk uses a lamppost, more for support than illumination.  The recent CD Howe paper by Philip Cross may tell us more about the author’s political ideology than the determinants of private sector investment.

- And speaking of ideological preferences for corporate wealth over the public interest, PressProgress contrasts the CRA's Con-ordered crackdown on progressive charities against its minimal action to deal with high-wealth tax evaders. And John Oliver neatly illustrates how the U.S.' economic system is rigged to favour those who already have the most:


- Meanwhile, David MacDonald examines the effect of EI, and finds that Canada's main employment income support has such restrictive entry requirements that it actually directs money away from the poor:

In fact, the group the most likely to be EI recipients is the middle 20% of the income spectrum (prior to layoff). They are the most likely to have surmounted the almost six months of constant work required to qualify for EI.

The other disturbing implication of the above results is that any group that represents less than 20% of the beneficiaries is in essence subsidizing the system. The lowest income group only receives around 16% of the benefits depending on the year. The poor pay into EI while working, but they are less likely to collect benefits if they’re laid off.

While we may consider EI a strong social support system, its current construction makes it particularly regressive for Canada’s lowest income families.

The easiest way to redress this inequality is to reduce the number of hours required to qualify for EI thereby letting in those with precarious employment resulting in more frequent bouts of EI. 

- Derek Thompson offers a reminder of the high cost of being poor. And Adam Carter reports on the effect of poverty on health for urban aboriginals in particular.

- Finally, Alison once again has all the background information you need to know on an astroturf group looking to brand any questioning of oil barons as unpatriotic.

Monday Morning Links

Miscellaneous material to start your week.

- Ralph Surette highlights the dangers of a pollution-based economy which fails to account for the damage we're doing to our planet and its ability to provide food for people:

This is something to behold. A more-or-less hurricane in early July. Has anyone ever seen such a thing?

This is climate change, and it's getting worse. And whereas the news of the day is about people with the power out, the long-term story is about the hit to agriculture, now and in future, here and worldwide -- keeping in mind that farming is more than an "economic sector." It's the food supply.
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This is the story all over, as agriculture, always up and down, has become a wild, unpredictable ride through floods, droughts, storms, killing heatwaves, heat-related pest infestations and other hazards. In some places -- drought-ridden California being the prime example -- the scary question is whether agriculture there is simply finished for good.
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What to do? As with our pollution-based economy generally, the answer is one we and our established systems resist ferociously: to change our ways. The experts point out that a third to half of food is actually wasted and mere increased efficiency, especially energy efficiency, in the food system -- from the farm to us -- would work wonders. Only 43 per cent of the world's grains are consumed directly by humans. The same applies to the other part of the food system, fisheries. A staggering figure in that regard is this: of the 110 to 130 million tonnes of fish caught worldwide annually, 30 million tonnes is discarded at sea -- the same amount as goes to fishmeal to feed farmed fish. Is this as impossible to change as it seems?

- Meanwhile, Tavia Grant discusses the health effects of climate change.

- Laura Broadley reports that Canadian Natural Resources Ltd. is now grudgingly admitting that its in situ oil extraction may be contributing to ongoing and still-unexplained oil spills. (As a friendly reminder, that's exactly the type of oil exploitation the Cons have declared to be immune from environmental assessment.) And Jessica McDiarmid writes about Windsor's fight to be able to protect its citizens from hazardous goods being shipped by rail.

- Gloria Galloway reports on the threat to Canada's national parks from unfettered resource development and a woeful lack of public investment.

- David Climenhaga points out that the Cons' latest spin on TFWs seems designed to allow low-pay zones wherever an employer wants to avoid offering a fair wage to Canadian workers.

- Finally, Shannon Gormley rightfully questions why equal pay for women is still projected to be a lifetime away:

Seventy-five years. According to an Oxfam report released Sunday, that’s how long it will take until women in G20 countries can earn, stow away and waste as much as the men who, right now, probably sign their paycheques. In no G20 country does women’s pay reach 80 per cent of men’s.

Before we get into how to save time (and money) — listen. That sound you hear is the sound of conservatives everywhere uttering a secret hope masked as insight: “Progress is slow,” these anti-progressives say, with a smugly wizened intonation peculiar to the type of man who smokes a pipe and has another man shave him with a straight razor.

Of course, 75 years isn’t slow. Turtles are slow; 75 years is an actual, honest-to-God lifetime. Seventy-five years is longer than it took a large chunk of Germany to go from being fascist to communist to capitalist. Longer than it took people to go from using typewriters to computers the size of living rooms to computers they wear on their eyeballs. Longer than it took Americans to go to the moon and then back again and then decide they didn’t feel like going to the moon anymore. Seventy-five years are about as many years as most of us will ever have.

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(W)omen who ask for raises, promotions and other career opportunities aren’t just denied what they want, they’re punished for asking: whether they ask “nicely” or assertively, whether they ask in writing or in person and, most remarkably, whether the person they ask is a man or another woman. Women’s bias against other women is a particularly clear indication that we can’t wait for our subconscious minds to change. We need to change systems and structures and let our minds catch up.

That’s Oxfam’s answer. In Canada, where “progress has stalled to a halt over the past two decades,” and only 57 per cent of women have been employed full-time over the past five years compared to 76 per cent of men, change has to mean national low-fee day care, which has given Quebec more money than it has cost, and no more public service cuts, which disproportionately affect women. Globally, it must mean equal pay legislation, non-discriminatory taxation, and paid parental leave.

Sunday Afternoon Links

This and that to end your weekend.

- PressProgress takes a look at the OECD's long-term economic projections - which feature a combination of increasing inequality and slow growth across the developed world, with Canada do worse than almost anybody else on the inequality front unless we see a shift toward more progressive policies when it comes to unions, employment protections and fair taxes.

- Meanwhile, Derek Leahy discusses how much we have to lose by relying on the tar sands as our sole economic engine.

- David Cay Johnston points out that several of the largest forms of consumer debt in the U.S. - including student loans, car loans and credit card debt - could have been wiped out by the money instead handed to the wealthy through the Bush tax cuts. And David Atkins reminds us of the vicious circle of right-wing governments converting surpluses into tax cuts while nominally left-wing ones then cut services to compensate - even as the former somehow claim to be the more fiscally responsible parties:

Republicans still somehow have the brand of fiscal restraint even though Ronald Reagan dramatically increased the deficit, Bill Clinton balanced the budget, and George W. Bush blew the deficit sky-high again before ending his term with the greatest economic crash since the Great Depression. Like Bill Clinton, Barack Obama is doing his best to close the gap, even as Republicans try to blow it back open again with supply-side cuts that we already know don’t work.

But there’s a double absurdity at work here, which is that in a poor economy the country shouldn’t be trying to balance the budget at all. Paul Krugman and the Keynesians have been proven right on this question repeatedly, even as the austerity fetishists and the supply-siders have been proven wrong at every turn. We know now definitively what we should have known instinctually back in 1980: that supply-side economics is junk science and a proven failure. We also know from the European experience that austerity economics only sends countries further into recession—with the added effect of increasing deficits in the bargain, thus supposedly necessitating further cuts in a negative reinforcement loop.

Democrats are supposed to be the party of stimulus and fiscal laxity. Republicans are supposed to be the party of belt-tightening and fiscal austerity. Instead we see repeatedly that Republicans play fast and loose with the nation’s budget in order to deliver tax breaks to their wealthy friends, while Democrats spend their time closing the deficits Republicans create. But even more bizarrely, we see Democrats counterproductively pushing austerity economics when they should be pursuing Keynesian stimulus, even as Republicans ironically vote for stimulus—albeit in its weakest and worst-targeted guise—in the form of tax breaks for the rich.

When budget politics has gone this far into funhouse mirror land, it almost makes popular polling on budget issues irrelevant. How are voters even supposed to know which party represents what policies, or even which economic theory they’re working under? While Republicans are clearly more destructive and wildly irresponsible, both sides are operating in such self-contradictory opposition to their stated economic ideologies and branding that it’s a wonder voters can even make sense of it all.

- And in a prime example of how corporate-oriented policy tends to lead to our paying more for less, Alan Pyke offers an inside look into the disastrous results of Michigan's prison food service privatization scheme.

- Finally, Blake Bromley discusses the effect of Harper government's political chill on (a carefully-selected set of) Canadian charities - and how the Con-ordered attacks reflect wilful ignorance of the law:

Initially, the primary focus was on environmental groups. However it has extended to charities' activities such as protecting human rights and humanitarian aid.

The problem is not that charities should be allowed to engage in political activities. The problem is that when conducting these audits, CRA gives a meaning to "political activities" that is designed to make its political masters happy.

One can only hope that CRA audits would be governed by the rule of law rather than a political agenda.

It has not been covered in the press in Canada, but just one day before this email from the Charities Directorate and this press coverage on political activities, an important legal decision was handed down in England. The First-Tier Tribunal released its decision in an appeal of The Human Dignity Trust against The Charity Commission for England and Wales.

This decision held that "promoting the sound administration of the law" was a "fourth head" charitable purpose under the common law. This was not an expansion of the law of charity, but was recognized in cases as early as 1876 and as recent as a House of Lords decision in 1972. These common law decisions from England are recognized by the courts and CRA as being determinative of the law of charity in Canada.

Most environmental and other charities under audit are simply "promoting the sound administration of the law." This is not a political activity except in the eyes of the Harper government, which treats any recourse to the courts of law or public opinion in support of laws that conflict with the government's political agenda to be "political activities."