Saturday, October 01, 2005

Reality from an early age

A cross-party group of British MPs has proposed that careers advice be provided in school for children as young as 5:
'Careers advice should be given to every child of primary-school age,' said Barry Sheerman, a Labour member of the forum. 'For too many children, a future as a fairy princess or pop star is the only dream they have, and it doesn't occur to them to aspire to go to university, be a doctor or a scientist.

'It would, of course, have to be done in a delicate way,' he added. 'We are not suggesting sitting a five-year-old child down with a list of firm options but you need to inspire the imagination of the children to see where their potential could lead them...

The notion of providing careers advice for five-year-olds was cautiously welcomed by Chris Davis, Chair of the National Primary School Head Teachers' Association. 'I would never expect a primary school to have a careers adviser or hold a careers convention and it would be wrong to give young children precise advice on their future careers but there is a no reason why we could not give them an awareness of the reality of the way the world works,' he said.

John Coe, of the National Association of Primary Eduction, was more sceptical. 'An over-early approach to anything like careers guidance could be damaging to the free-ranging mind of a child, which is what we want to encourage; we want young children to imagine and to have dreams,' he said.

My first impression was one of suspicion, based largely on how long it seems to take many people to find anything resembling a career path even after having ample access to job information. To my recollection, a good number of my classmates at the undergraduate university level still had very little idea what they wanted to do with their lives...and I have a tough time believing that they didn't have a pretty good idea what choices were realistically available.

But then, what if a more realistic set of options earlier on could help students to better evaluate those options for the future? This could well be the case where the options are presented earlier both in time and in a child's development process. On added reflection, the idea seems to be one worth considering at the very least - particularly in its potential effect on students from more difficult backgrounds who may lack both positive role models, and a real sense of what types of careers are available.

This doesn't mean that creativity should be stifled in the least in early eduction...but instead, that creativity may be able to flourish all the more if students better understand the societal framework in which they operate. With that in mind, the British idea is one that we too should give some serious consideration.

Dysfunctional fundamentalism

In light of the focus on fundamentalism and "values" over the last couple of U.S. elections, many people have pointed out that most of the states which seem to vote based on "values" tend to be the least effective at actually putting those values into place. Now, that phenomenon has been confirmed on an international level:
The study, by evolutionary scientist Gregory S. Paul, looks at the correlation between levels of "popular religiosity" and various "quantifiable societal health" indicators in 18 prosperous democracies, including the United States.

Paul ranked societies based on the percentage of their population expressing absolute belief in God, the frequency of prayer reported by their citizens and their frequency of attendance at religious services. He then correlated this with data on rates of homicide, sexually transmitted disease, teen pregnancy, abortion and child mortality.

He found that the most religious democracies exhibited substantially higher degrees of social dysfunction than societies with larger percentages of atheists and agnostics. Of the nations studied, the U.S. — which has by far the largest percentage of people who take the Bible literally and express absolute belief in God (and the lowest percentage of atheists and agnostics) — also has by far the highest levels of homicide, abortion, teen pregnancy and sexually transmitted diseases.

The article notes that the correlation shouldn't be equated with causation in one direction or the other; it could well be that it's ultimately social dysfunction that creates a greater impetus for religious belief, or other causal factors may best explain the link. But whatever the cause, there's now solid data to refute those who would try to link fundamentalism (of any faith) to societal improvement, or atheism and agnosticism to moral decay.

Svend's return

The Globe has an extended story on the likely return of Svend Robinson to federal politics:
(I)t's sounding more and more likely that Svend Robinson...will run again in the next federal election.

"I'm pretty close," Mr. Robinson said in an interview. "It would take something pretty significant for me not to go ahead now. And I just don't see what that would be."

He will make it official in two weeks' time and when he does, the former New Democrat MP will announce he's running against Liberal MP Hedy Fry in Vancouver Centre...

In the past year, he has gone public with his mental illness, which runs in his family. For the longest time, he refused to say what type of mental illness he suffered from. He recently disclosed that it is bipolar disorder, a condition for which he was prescribed medication. He no longer takes it but continues to see a therapist once a month.

Mr. Robinson wants to use his voice to try to remove the stigma around mental illness.

From a partisan NDP standpoint, it's great to see such a talented organizer and politician back on the political scene. But the bigger story here is the personal one: having already done a remarkable amount of work toward breaking down barriers based on sexual orientation, Svend is now taking aim at another issue that's all too often completely misunderstood. And Canada will be a lot better off if he's as successful now as he's been in the past.

Off target

As for our own gun registry, we should keep in mind the difference between a policy's desirability in its own right, and the actual execution of the policy. Which I say before pointing out that our actual gun registry has run into yet another problem:
A website that generated fake Canadian gun registrations continued to operate for more than a year after federal officials tried to shut it down...

The centre learned of the Internet site April 15 last year, and immediately faxed a letter to the California-based company that hosts the web page.

A lawyer for the centre warned that by hosting the site, Homestead Technologies Inc. was "counselling as well as aiding and abetting a criminal offence."

"Given the severity of the conduct, we would appreciate the site being taken down immediately," the letter said.

But Homestead's vice-president of marketing, Manvinder Saraon, said in an interview that the company has no record of that fax, and first learned of the problem when contacted recently by a reporter. The company has since shut the site down.

"There was no follow-up from the firearms centre, as far as we know," Saraon said.

Now, it could be that the apparent lack of notice was merely a matter of the company now covering its tracks. But surely somebody should have been concerned enough about the site to follow up long before anything actually happened.

Again, this doesn't speak to whether or not the registry was a good idea in principle. But like the contractor-induced cost overruns, it certainly begs a few questions about the people left in charge of the system as it stands.

Guns under fire

It isn't a policy that we'd want to follow in full no matter what the outcome, but we should be watching closely the results from Brazil's proposed firearm ban:
(L)ater this month every citizen from 18 to 70 will confront a clear, yes-no question: Should the sale of all types of guns and ammunition be banned nationwide for everyone except the police and military?

The Oct. 23 referendum, in which all adults must participate (voting is optional for those over 70), will be the first time any country has taken a proposed gun ban to the national ballot. Brazil has the highest number of firearms fatalities in the world, with more than 36,000 people shot dead last year, according to government figures...

Supporters of a ban do not claim that outlawing the sale of guns and ammunition would put a stop to violence. Instead, they say the initial aim is to reduce the huge number of guns flooding the country of 186 million people. An estimated 17.5 million guns are currently in Brazil, about 90 percent in civilian hands and half of them illegal...

"In Rio alone, there's a gun stolen once every five hours," said Josephine Bourgois, an arms control researcher with Viva Rio, an anti-gun organization that conducted the analysis. "By reducing the overall number of guns in circulation, we'll be able to decrease the number that migrate from law-abiding citizens and end up in the hands of criminals."

For all the talk about the cost of Canada's gun registry, combined with the consisent pro-gun influence from the U.S., it's easy for Canadians to assume that gun ownership is a lot more desirable than may actually be the case. If Brazil's referendum passes, then we'll get to see whether a supply-side ban can actually reduce gun violence in a state with some important similarities: i.e. a large local supply of guns and a border which makes significant smuggling inevitable. If not, then we'll have a sound reason not to look at comparable action; if so, then the usual arguments against further gun control in Canada will look a lot less powerful.

Friday, September 30, 2005

A brief treatise on corporate tax levels, starring Joe

I'll start by agreeing with both Ginna and Lord Kitchener's Own that it's great to have a civilized policy debate happening in political blogosphere. In keeping with that, a few of Ginna's comments (both here and on Gin and Tonic) deserve further commentary on my part.

To start with, I disagree with Ginna's characterization of money taxed from corporate earnings as "our money". This assumption seems to be based on the view that wealth inherently belongs to the individual who nominally acquires it, with no regard for the societal context which allows for that wealth to be generated, as a consequence of which all taxation is illegitimate. I'll hope that we can find agreement on how that perception is wrong.

In order to get to that agreement, I rely on the presumption that some form of government is necessary. I presume this point isn't in any great dispute, given that Ginna backs the Conservative Party rather than an anarchist/libertarian group.

Given that starting point, some level of taxation has to follow in order to allow the necessary government to function. The optimal level of taxation must be the level at which government is able to provide all services properly kept on the government level, without taking in extra revenue which goes to improper/unnecessary/undesirable purposes. To the extent that taxation happens up to that level, I don't see how there can be any dispute that taxation is legitimate, and that the money taxed is properly the state's rather than the individual's (particularly to the extent that a lack of proper government could make it impossible for the wealth to be generated in the first place).

The questions of what services fall to the government to be provided, and accordingly what level of taxation is optimal, are ones where I highly doubt we'll find too much common ground. (Not to mention that they probably cover a strong majority of the total content of political debate.) I'll thus leave them aside for now, except to comment that I think it's perfectly fair to say that increasing or decreasing the role of government on policy grounds has to fit the definition of "tilting public policy".

Let's move on then to look at the nature of the corporation, and the role of the government in making corporations viable. Ginna's first post pointed out the following:
Due to the vagaries of Canadian tax law, it makes no sense for businesses which actually employ someone other than the owner to operate as anything other than a corporation. Think about that for a minute. There are no middle tiers in Canadian business. My mom has a corporation. Incorporation is not that hard - everybody's doing it!

Why then is everybody incorporating if it results in having to pay an extra 21% in taxes on net revenue? Ginna provides the answer: based on other provisions of tax law, for the vast majority of businesses, the investment in incorporation provides a pure financial gain (along with limited liability and other benefits).

Indeed, it's very simple for a single operator or small group of owners to acquire "the freedom to run (one's) own businesses, without government interference at all outside regulatory" by conducting a business as a sole proprietorship or partnership. The corporate tax is thus far easier to avoid than personal income taxes or consumption taxes. Nonetheless, most businesses choose to incorporate to get access to other benefits...despite the existence of the corporate tax at its current level.

Seen in this context, lower corporate tax rates aren't properly seen as a matter of keeping more of a business' own money in the pockets of its owners. Rather, they're a way of ensuring that corporations pay even less of the true value of their privileged legal status than they already do. Or through the lens of my take on the proper role of government, lowered corporate tax rates attempt to transfer even more of the value of an externality to profitable corporations of all sizes - without asking the question of who's ultimately paying the cost of the externality.

Out of an abundance of caution, I'll make clear that I fully support the presence and growth of corporations as a means of generating wealth. But it still has to be said that corporations (even more than most people or groups) benefit directly from government policy, and it's not the least bit unreasonable to expect them to contribute back a portion of those benefits.

Thus concludes (for now) my take as to why neither taxes in general, nor corporate taxes in particular, can be fairly seen as an affront to individual choice. But let's get back to the original question of what impact a corporate tax cut will have on small businesses generally.

Over at Gin and Tonic, Ginna is skeptical that larger organizations will necessarily use their money better:
I would probably also add that the author has a common and somewhat touching faith in the ability of large corporations to be ruthlessly efficient, and marshall their resources accordingly. Most stock investors know that the promised efficiences almost rarely happen, which is why when it does (WalMart!) the effects are brutal. Luckily for our plucky small business owners, that's rarely the case.

On this point, I'll offer one caveat to my previous post: not all large businesses are foreseeably profitable in the near term, and the ones who aren't won't acquire any advantage from a reduction in taxes. Of course, those are often huge industries with historical political support such as airlines, major manufacturers, etc. who likely don't have to compete with too many Joes anyway. But for those who are able to plan to benefit from the tax cut, I'll stand by the argument that they're likely to do much more as a result than smaller businesses.

In essence, the management of the cut by either of the sign corporations will follow a two-step process: first, the company will assess how best to spend the money; second, the company will actually go out and spend it.

On the first step, Ginna makes a fair point that diminishing returns will come into play: Joe probably has a pretty good idea what options are available generally, and the choice to pay additional people to come up with new ideas won't necessarily add value. The question of whether SignCo does better than Joe's at this step will depend on the amount of resources that each puts into the step, and how efficient each is at using the resources.

But there's no way for Joe to actually gain on his larger competitor at this step unless SignCo is actively wasting resources: if there's no efficiency to be found by putting multiple heads to the task, then nothing stops SignCo from putting its own decision in the hands of an individual who'll take no more time and effort than Joe. And I don't think it takes any great faith in the magic of large corporations to assume that they generally try to act in their own economic self-interest.

In most cases, there will be some benefit to be had by putting more than one person's knowledge to use, and the resources that SignCo puts into analyzing the use of the money will pay off at least somewhat. In addition, if SignCo has a greater geographical reach, then it is able to examine more possible beneficial investments than Joe does. Call this a small win for SignCo in spotting different ways to spend the money, with a possibility of a neutral result.

Before analyzing the second step, let's add another fairly simple premise which I don't think can be in dispute. The premise is that economies of scale exist: if X amount of money will buy Y amount of goods, then in virtually all cases 2X amount of money will buy somewhat more than 2Y of the same type of goods. The reasons for such an effect aren't too important, but probably include a lack of duplication in the process and resources necessary produce the additional units of Y, and the general willingness of businesses to minimize risk by giving lower prices in exchange for a more secure source of revenue.

At the second step, the issue is then solely one of economies of scale. Even if Joe's and SignCo put the tax cut money into precisely the same type of capital investment, SignCo's greater size allows it to get proportionally more return on the investment.

And then there's the effect of the investments of all the other corporations going through the same process. This too favours SignCo strongly: larger businesses will have a strong incentive to make any capital purchases from another large supplier rather than trying to cut separate local deals with each Joe, while there isn't a particularly strong incentive for Joe to direct his investment one way or the other as between larger or smaller businesses.

As Ginna points out, there's probably also some pie-enlarging effect going on. From the standpoint of each Joe, the question is whether the gains from the larger pie outweigh the losses in competitiveness. And I allow for the fact (as I did in my earlier post) that for some Joes, perhaps including Ginna's own business, the benefits will outweigh the costs.

But then, remember Ginna's original argument that small businesses are our main economic drivers, and that we should accept corporate tax cuts predominantly for their potential positive effect on small business. Now, that argument has been completely turned on its head:
The WalMart myth tells us that small businesses can't compete with large. When the big box killers come to town, they destroy the home-grown. And truly, this is often the case. But I would argue that the larger problem is that the failed businesses failed to adapt and compete.

Suddenly small business isn't seen as something to embrace at all; rather, it's something which we should try to put through an accelerated evolution process of adapt or die, with the knowledge that the latter fate will often occur. Needless to say, this strikes me as a rather counterproductive way of treating the businesses which now offer more than half of our private employment.

I'll grant that Ginna's original post included an attempt to side-step this issue, in the statement that how small businesses would spend the tax cut isn't the point. But I don't accept that position. How the tax cut will be used is entirely the point, as the core question is what to do with the money currently collected by the federal government. Even if taxation were generally illegitimate, in order to justify making only the corporate tax cut we'd still have to examine the comparative legitimacy of different types of taxes rather than relying on a blanket statement that the effect of one person's chosen policy is irrelevant.

In sum, the effect of a corporate tax cut isn't only to divert resources from other sectors to a corporate sector which is already doing rather well; the cut also makes it more difficult for small businesses who collectively employ more people to survive as compared to larger ones who employ less. And it doesn't seem to me a tough call to say that some other policy, be it another form of tax cut, a social investment or even a payment on the national debt, must be a better use of those resources.

The catch-all response

Paul Martin today:
“The only way that we're going to have a peace economy is if Canada has a very active, very aggressive foreign policy,” Mr. Martin said...

“It's no good to have peace only for Canada if you've got conflict and rape and pillage in places like Darfur or widespread areas in Africa,” he said.

Johanne Gelinas yesterday (on other issues mind you, but it still fits):
"The federal government is chronically unable to sustain initiatives, once they are launched."...

"The federal government is trying to navigate without a chart," Gelinas said. "This leaves parliamentarians and Canadians with no idea of where the federal government plans to go, or how it intends to get there."

From here on in, let's just assume that Gelinas' report is the definitive answer to all Liberal policy announcements or mission statements until somebody says otherwise.

Taking notice

The countries who signed onto CAFTA may not be paying attention to the U.S.' record in meeting its trade commitments - but the softwood lumber dispute apparently hasn't escaped the attention of the third member of NAFTA:
Mexican President Vicente Fox has lauded the North American Free Trade Agreement while appearing to criticize the United States for failing to abide by recent softwood lumber rulings...

(T)he Mexican president appeared to take a shot at the Americans over their handling of the lumber tiff.

In the preliminary text for a speech to the Vancouver Board of Trade, Fox says Mexico regrets any "unilateral decision that fails to abide by the decisions of the arbitration panels."

It's questionable whether NAFTA deserves all the credit given to it by Fox elsewhere in the article. But it's now clear that Canada isn't alone in its concern about the U.S.' actions: Mexico too realizes that the agreement is somewhat undermined at best, and utterly useless at worst, if the other signatories can't count on U.S. compliance. The public statement won't be enough to push the U.S. into action, but it has to help the process.

Update: Some later remarks from Fox were even better than the prepared speech:
"Mexico fully supports Canada's position to make sure the decisions of the NAFTA panels in the settlement of disputes are upheld," Fox said.

Tying one's own hands

In an apparent effort to woo soft Con voters, the Libs are looking at legislation to mandate balanced budgets:
The so-called "no deficit rule" has been in effect since the budget was balanced in 1997-98, but it remains a convention rather than a legislated requirement. The legislation, which may come as part of Mr. Goodale's fall fiscal update, will also likely commit the government to reducing the debt/GDP ratio to 25% by 2014, from the current 39%.

Now, one would expect most people to wonder why an effective convention needs to be replaced by legislation. But surely the financial industry would be happy with the move, right?
Don Drummond, chief economist at TD Bank Financial Group, said a guarantee against deficits was "horrifically bad policy. This is entirely political. We have created an 11th principle 'thou shalt never go into deficit' but the impact of a $1- or $2-billion deficit in an economy our size would be irrelevant. The whole thing seems bizarre."

Tim O'Neill, the chief economist at Bank of Montreal who was asked to review Canadian fiscal forecasting this year by Mr. Goodale, concluded the no-deficit rule was a major cause of the persistent inaccuracies in budget forecasting that have seen the government continually under-estimate large surpluses.

Mr. O'Neill recommended the government instead balance its budget over an economic cycle, which would allow deficits to be incurred when warranted by economic circumstances.

There's much to be said for running the government like a business - and part of that has to include looking at the bigger picture, rather than putting the numbers on a single financial statement ahead of good overall policy. In some down years, that's bound to mean running a deficit no matter how well the government is run.

Not that some of the implicit alternatives are all that great either. Systematic deficits should be avoided, and I'd worry that the "economic cycle" put forward by O'Neill could be easily manipulated by governments claiming that an upturn is just around the corner. But given that neither of those problems exists as the government is being run now, there's no good reason to give the force of law to an arbitrary fiscal policy.

Thursday, September 29, 2005

Self over country

If there was any doubt that Frank McKenna will take a run at federal Liberal leadership, his comments today should put an end to it:
In a speech on Thursday to the Empire Club of Canada, Frank McKenna called the U.S. government dysfunctional and raised the alarm over America's growing budget deficit.

"The United States is a wonderful creation," McKenna said. However, "the government of the United States is in large measure dysfunctional."

Now, never mind that the statement is all too true. There's no point in making that the standard when the Washington establishment is built on something other than truth. And McKenna's candor can't exactly endear him to the officials who have created the dysfunction - who not coincidentally are the same officials who'll be liaising with McKenna during the balance of his term. McKenna will probably look better in the "stand up for Canada" sweepstakes for the comments, but they're completely out of place for a diplomat.

There are many times and many situations where a good potshot at the state of U.S. politics is entirely appropriate. (And lest that be interpreted as America-bashing, the same goes for our own.) But our ambassador shouldn't be the one taking those shots - especially when we need our international ammunition for much bigger substantive issues. And if there's any justice, McKenna's lack of diplomacy will be seen as a negative when he comes home and asks for our trust.

Trying too hard

Most organizations would take a 9-0 Supreme Court ruling against them to be a bad sign. But judging from this press release from Imperial Tobacco, you'd think it had been successful on all counts at the hearing:
Today's Supreme Court of Canada's ruling reassures Imperial Tobacco Canada that it can have a fair trial and bring forward all the relevant information in any legal action undertaken by the B.C. government under the Tobacco Damages and Health Care Recovery Act. The company intends to vigorously defend itself in any trial initiated by that province.

Now, maybe it seems like a rather fine legal point. But could anybody read the decision and think that a victory for the government would force the tobacco companies into an unfair trial with key information suppressed?

In fact, it was the tobacco companies who tried to argue that such unfairness was the effect of the Tobacco Damages and Health Care Costs Recovery Act. And what's more, the Court didn't even say that the rules under the Act were entirely fair or logical; it merely concluded that they weren't constitutionally invalid as interfering with the court's independence:
54 None of this is to say that legislation, being law, can never unconstitutionally interfere with courts’ adjudicative role. But more is required than an allegation that the content of the legislation required to be applied by that adjudicative role is irrational or unfair, or prescribes rules different from those developed at common law. The legislation must interfere, or be reasonably seen to interfere, with the courts’ adjudicative role, or with the essential conditions of judicial independence.

So even if any one company's goal at the hearing was to reassure itself that the rules would result in an absolutely fair hearing, nothing in the decision suggests that it was any better than "not as unfair or illogical as the appellants submit". Which can hardly be seen as a victory even on that front.

I presume the goal of the bravado is to reassure investors (substantially the same reason why the decision's release was delayed). But I for one would look a lot more favourably on a company willing to ground its public statements in reality. After all, if a company is willing to make statements contrary to facts in the public domain, how could one trust its opinion when there's no objective data for comparison?

It's easy enough to understand the desire to put a brave face on a loss. But there are times when it's perfectly appropriate to admit defeat on an issue - especially when, as pointed out later on in the press release, the question was merely a preliminary one with a full trial to follow. Instead, investors have a lot of reason to be suspicious about what Imperial has to say elsewhere. And that could cause far more panic toward stock values than any court decision.

The environmental dangers of confetti

The federal environmental commissioner gets it exactly right, pointing out that there's been an awful lot of talk about the environment but precious little action from Martin and company:
Johanne Gelinas, commissioner of the environment and sustainable development, said the government tends to make loud announcements which are forgotten "as soon as the confetti hits the ground."

In a report released Thursday, Gelinas chides Ottawa for doing a poor job protecting the oceans, promoting biodiversity and ensuring safe drinking water on native reserves.

It also says the government has no policy for buying green, environmentally sound products, nor has it pushed departments to co-ordinate policies on sustainable development...

"The federal government is chronically unable to sustain initiatives, once they are launched."

Now that the truth has been confirmed by the person specifically assigned to thoroughly examine the government's response to environmental issues, it's essential to make sure that Gelinas' report is brought to the forefront every time Stephane Dion unveils a shiny new plan (or portion thereof).

The suggestions in the report are far from unrealistic, and indeed seem so glaringly obvious that it's tough to believe they're not in place already. A reduction in bureaucratic infighting to focus on the big picture may run into personality conflicts and thus require a lot of (justified) effort. But a systematic effort to link environmental concerns to government procurement isn't hard at all, and in fact has been codified in Saskatchewan among other provinces. And while we know about PMPM's usual record of keeping promises, it shouldn't be too much of stretch to meet past commitments about biodiversity, or to go to the trouble of putting together (and eventually implementing) a plan on ocean management when the enabling statute was passed eight years ago.

These may not be sexy political issues, but they're a very simple way to make a real difference with regard to the environment. Hopefully they can be either put into the broken-promise context this fall to bring them to the forefront, or better yet addressed as part of the NDP's conditions for cooperation.

Rightful suspicion

China is apparently splitting off from the other states involved in negotiations with North Korea by demanding that an IAEA resolution include both sides of the bargain. And it's tough to blame them from the sound of the resolution as it stands:
A split between China and the four other countries that negotiated with North Korea on scrapping its nuclear arms could doom efforts to come up with a resolution welcoming the North's decision at a meeting of UN nuclear agency, diplomats said Thursday.

The diplomats, who requested anonymity in exchange for discussing the confidential details of the dispute over a North Korean resolution, said China wanted mention of a light-water nuclear reactor and other commitments made to the North in exchange for its decision – something that the four other nations opposed.

It only seems sensible that if an agreement is going to be effective, it has to fairly thoroughly set out the obligations on both sides. And any fair commentary on the agreement also has to point out that it's not a one-sided surrender, particularly in light of Bushco's past eagerness to turn vague terms into a basis for war.

In a sense, the second-biggest thing North Korea has going for it right now (after nuclear deterrence) is the lack of standards that it's obliged to meet. Bush has shown a ready willingness to be judge, jury and executioner in determining whether a state has met its standards or cooperated thoroughly enough in meeting them...but he's been unable to plausibly say that North Korea has fallen short of any agreements that were followed by the other side. Part of that is due to lack of knowledge resulting from the secrecy of Kim's regime, part of it due to the U.S.' failure to meet the terms of the previous agreement.

If North Korea is now going be at risk of being on the wrong end of Bush's assumptions, at the very least it needs to receive some very clear assurances as to when and how it'll benefit from doing so. And a vague intention to provide unspecified rewards doesn't fit the bill, as "future commitments" could ultimately be minimized just as much as "serious consequences" were overblown.

It's great that there's cooperation happening now, and all the better if the IAEA wants to go out of its way to acknowledge the fact. But the rest of the world needs to pay close attention to the obligations on both sides of the deal...and any resolution which pretends otherwise only further damages the international perception of the IAEA.

Wednesday, September 28, 2005

What's best for Joe

A Blogging Tory gets angry about my not appreciating proposed corporate tax cuts, arguing that my dislike of "indiscriminate corporatism" is really a slam at small business.

Needless to say, gdowler has it all wrong. In fact, I'd love to see policies put in place that genuinely help to encourage small business in Canada. The problem is that corporate tax cuts systematically give larger businesses an advantage over smaller ones - and that's why I'd sooner see the money applied elsewhere.

Consider the Joe in gdowler's example, and assume that there's a different Joe making signs in each of hundreds of communities. When each Joe first sees his tax cut, he'll be happy with it to be sure. But then, Joe probably doesn't have a lot of spare capacity to decide what to do with it - the cost of hiring a professional to decide how to use it most productively would wipe out the benefit entirely. Maybe he'll use it for himself, maybe he'll use it for capital investments, maybe he'll put it toward employees. But unless a given Joe is either a downright clairvoyant businessman or just extremely lucky, he probably won't wind up using the money in the optimal way to benefit his Sign Shop - not because he's a poor businessman, but because he doesn't have access to the same resources.

Contrast this with SignCo, the big-box sign-maker competing for the same business as Joe's. SignCo nets millions of dollars in profits in Canada, meaning that when the tax cut comes in, an army of lawyers, accountants and planners goes to work analyzing how best to handle the increased revenue. In at least a few communities, SignCo will decide to invest enough resources to put Joe's out of business entirely - be it through capital investment, through an advertising blitz or by hiring away Joe's employees. In others, it puts in less resources, but still gets a better return on them thanks to its greater purchasing power and closer analysis.

On the balance, the SignCo gains incrementally on the local Joe's in all but a few communities based solely on the added income. And in a competitive market, a gain for SignCo is a loss for Joe.

But it doesn't stop there. We should be familiar with the fact that the Bank of Canada will tend to match an increase in inflation with an increase in interest rates. To the extent that corporate tax cuts add new money to the marketplace, interest rates then go up to compensate. That's not a huge problem for a SignCo, a multinational corporation with the ability to seek out lenders globally and fund any number of share or debt offerings. It's a much bigger problem for Joe, who's too busy running his sign store to get his capital anywhere but at a local bank whose rate is closely tied to that of the Bank of Canada. (Never mind that it's an even bigger problem for consumers generally; we'll stick to the business comparison for now.)

The end result is that while Joe gets some momentary tax relief, he doesn't have the resources to apply it as efficiently as his competitors, and he also ends up with increased borrowing costs which don't affect SignCo to the same extent. In the long run, all but the luckiest of the local Joes end up being hurt by the competitive effects of the tax cut. And those numbers that gdowler cites as to the importance of small-business employment get driven downward.

I presume gdowler would argue that taking into account other industries, the net result would be an increase in economic growth which would help both businesses do better. To which I'd have to respond in two ways: first by pointing out that the big-business advantage would take place in all those industries as well, and surely nobody will be so naive as to claim that the bigger businesses won't try to make use of their comparative advantage; and second by pointing out that increased growth would similarly be generated by consumption tax cuts or increased social spending which wouldn't have the same negative effects on the smaller business. And if the same resources were dedicated instead to a revenue-neutral small-business growth fund...well, then Joe would have a genuine advantage.

None of the above is to say that corporate tax rates should generally be raised. Indeed, an upward fluctuation would also give at least some benefit to the corporations most able to analyze the implications in advance. In general the more the rules change, the more advantage there is to those with the resources to better anticipate the effects of those changes.

Nor would I describe SignCo as an "evil corporation", as gdowler suggests. What SignCo is, rather, is a corporation with sufficent resources on its own that it doesn't need public policy tilted in its favour. It has potential positive effects (employment, wealth generation) and potential negative effects (taking advantage of externalities, tendency toward monopoly), and the proper governmental regime is one which helps to maximize the former while minimizing the latter. Hence my dislike of "indiscriminate corporatism", which I see as policy which is so caught up in the benefits of big business as to neglect the potential harms.

Meanwhile, the best situation for small businesses is a relatively stable environment with relatively equal access to resources. If the tax and regulatory environments are at reasonable levels to begin with and stay stable, if wages are able to stay at a relatively consistent level rather than facing a Wal-Mart (SignCo?) push downward, and if there's a local bank or credit union which provides Joe's capital at a rate not too different from that available to SignCo, then Joe will have a much better chance of building a successful business in the long run.

Learning lessons

It may have taken a disaster in the U.S. for the public to notice, but Canada has had an ongoing process looking at its own emergency response. The bad news is that based on a new report, that process hasn't done much good yet:
Granatstein says it's disheartening that no crisis plan melding Canadian military resources has been drafted four years after the terrorist attacks on the United States...

Granatstein's report is a 10-year report card on recommendations made by a special commission in 1995 to improve the lot of part-time soldiers. And while the update found reservists are better paid today, it sounded other alarm bells.

The report notes the Canadian Forces doesn't even have accurate records of its retired specialists and other trained personnel to call upon in a time of crisis...

"This is simply not acceptable. A resource that could and should be invaluable . . . is being squandered for want of direction and will, and a few clerks to keep records up to date."

Based on the report, it appears that Canada has been more lucky than well-prepared when it comes to disasters. While it helps not to have Mike Brown-style patronage in key oversight positions, there's still a serious problem if little is being done to make sure that the knowledge held within the country is easily accessible when needed.

It's great that we're paying attention now. But it'll be the next few years that ultimately determine whether Canada does enough to minimize the downside to potential catastrophes - and it seems all too likely that the issue will disappear again long before any meaningful action is taken. Which would leave us all the more likely to learn the hard way in the future.

A real nuclear threat

Nearly 20 years after the initial disaster, officials in Chernobyl are just now finding out where nuclear fuel (which had previously been presumed stolen) was stashed:
Security officers discovered a plastic bag with 14 pieces of nuclear fuel during a routine search of the damaged reactor's perimeter last week, said plant spokesman Stanislav Shektela. The pieces included part of a fuel rod and small pipes.

He said the radioactive material "was probably missing since 1995," when several people were arrested and convicted of stealing nuclear fuel from the destroyed reactor's central hall...

The Chernobyl power plant was finally shut down in 2000, but Ukrainian authorities are still struggling to collect and dispose of all the damaged nuclear fuel rods scattered inside the reactor hall.

The article notes that the current barrier set up around the Chernobyl plant is in desperate need of repairs. And it seems fairly obvious that there's a need for more thorough investigation of any unaccounted-for fuel if it's possible to find new supplies of it based on a "routine search" ten years after the last documented theft.

One would think that the Chernobyl experience would cause countries both to be wary about using nuclear power at all, and to be exceedingly careful that any international nuclear activity happens under close cooperation and supervision. Unfortunately, Ontario seems to be failing on the former count, and the IAEA on the latter. Meanwhile, the site of the world's greatest nuclear accident isn't getting its due attention domestically or internationally. We can only hope that the lack of attention won't have even more grave consequences than have already been experienced in Chernobyl.

Back from the brink

Some welcome relief in the EU/US move against Iran's nuclear program: even if it's eager to lend its name to the group for the purpose of political pressure, the UK isn't willing to consider military action:
Military action against Iran is inconceivable and diplomacy could still end the international standoff over Tehran's nuclear program, said British Foreign Secretary Jack Straw, whose country plays a key role in negotiations...

“All United States presidents always say all options are open. But it is not on the table, it is not on the agenda. I happen to think that it is inconceivable,” Mr. Straw told British Broadcasting Corp. radio on Wednesday.

As illogical as any military action would seem, there's still a nagging sense that an Iraq withdrawal/Iran invasion could be a handy way for Bushco to try to rally the (political) troops next year. With any luck, Britain's newfound recognition that diplomacy is generally a better policy than invasion will help to make sure that doesn't happen.

Tuesday, September 27, 2005

Go on and fool me

Did the Washington Post just mistake Bush's momentary call for conservation for a genuine attempt to eliminate oil dependency?
Although Jimmy Carter was ridiculed for his cardigan campaign, Mr. Bush's rhetorical U-turn is welcome. It recognizes that any serious energy strategy has to include conservation. But there is a difference between supplication and policy. If Mr. Bush really wants to promote more careful energy consumption, he ought to tax it...

This is a smart way to make oil producers subsidize U.S. taxpayers. Because of the energy tax, producers would face lower demand and lower market prices; they would, in effect, pay perhaps a quarter of the energy tax, with consumers picking up the balance. Fuel-tax revenue would ease the pressure to raise taxes to plug the budget deficit, so Americans would come out ahead; they would be getting Saudi Arabia's help in rebuilding the nation's finances. Air quality, climatic stability and U.S. foreign policy would all gain, too. And really, as the new Mr. Bush might say, how painful would it be to consume a bit less energy once the initial lifestyle adjustments are made? Is it really so terrible to walk to the bus stop? Or to wear cardigans in the office?

From a U.S. standpoint, the Post's suggestion would make some sense in an administration that was interested in rationally appraising policy with no strong bias toward given industries. But surely the Post has seen too much of how Bushco actually operates to believe that its nominal head wants to let his oil-industry cronies pay even a portion of the cost of a new tax when he can let future taxpayers handle the bill instead.


More material comes out to show that for all the wealth in the province, Alberta isn't getting much bang for the bucks:
37 per cent of Albertans surveyed in April and May of last year said they had experienced a preventable medical error at some point in their lives. Of this group, 63 per cent said they did not receive an apology from the doctor or other health care professionals...

Of the 37 per cent who said they or a family member personally had experienced a medical error, 36 per cent said that error resulted in death and another 54 per cent said it resulted in long-term disability for the patients...

A similar survey conducted by the Canadian Institute for Health Information in 2004 found that 24 per cent of Canadians or their family members had experienced an adverse effect during their medical care.

So next time you're wondering whether Alberta's money could help to ease your province's health-care needs, keep in mind that you're already less likely than an Albertan to suffer adverse effects from a preventable medical error (which presumably could result from being given the wrong prescription).

No wonder private-sector care looks better to Albertans than to the rest of the country. But it shouldn't be forgotten that the province's attitude toward public care could have an awful lot to do with the problems in the first place.

Informed choices

Thomas Walkom demolishes the claim that European models for two-tiered health care are either practical or desirable in Canada:
To Canadians, a two-tier system is one where anyone at anytime has the right to pay for health care privately, either out of pocket or though insurance.

This notion of choice is attractive to many, particularly to those anxious to avoid waiting lists for elective surgeries.

But that's not the way the health system works in Germany and Holland. There, citizens can't flit back and forth between the public and private tiers. They can't choose to get their knees fixed privately in order to avoid waiting lists and then have longer-term and more potentially expensive problems such as kidney disease attended to publicly...

The other key feature of the European systems is that physicians' wages in the private sphere are tightly regulated. In Holland and Sweden, for example, specialists cannot be paid more privately that they would receive publicly. Thus there is little incentive for doctors to treat private cases ahead of public ones, and for patients little chance that "going private" will result in faster care.

Most of the argument in favour of maintaining one-payer care has focused (and not without reason) on the question of whether we want there to be any capacity to choose to push ahead of other waiting patients in receiving access to a public good. But Walkom's line of argument should be all the more effective.

If the very systems put forward as models for private care are able to function only because they limit choice just as thoroughly as the one-payer system, then there's no apparent reason to shift from a more easily-administered restriction to a more complex one. And it's no answer to that to say that we could avoid the controls, given that such a model would more closely resemble the U.S. debacle than the European models which are comparable to our own in quality.

For all the valid complaints about our underfunded system, the problem is still a lack (and in some cases misallocation) of resources rather than a need for structural change. And the more resources we spend debating (or actively moving toward) a less-efficient two-tiered system, the less we'll be able to apply to any real positive change. It shouldn't then be hard to decide where we want to put our efforts - at least, for those of us more interested in a system that works than in the ideology of the market.

(Edit: typo.)

Balanced thinking

A new poll suggests that while Canadians are still concerned about a balanced budget, they're even more interested in spending on appropriate priorities:
A survey conducted for the Canadian Values Study, a joint project of the National Post, the Dominion Institute and Innovative Research Group, found 53% of Canadians agreed with the statement that Ottawa should "continue to run a balanced budget, even if it means we have to delay spending on key social priorities."

But a significant minority -- 40% -- of Canadians agreed with the opposite statement: that the federal government should "increase spending to address the social deficit, even if it means running a budget deficit."...

While 64% of Canadians agreed with the statement that "Canada's strong fiscal responsibility over the past decade is a key foundation of our recent economic growth," an even higher number (79%) agreed the country has "a pressing social deficit that is measured by problems such as homelessness, waiting lists for health care and lack of access to post-secondary education."

The poll offers another example of how the current political sphere doesn't seem to represent the views of Canadians: while none of the three main federal parties has expressed any interest in deficit spending, 40% of all Canadians are looking for just that even when immediately compared to the budgetary tradeoff. Part of that may relate to the all-too-well-ingrained assumption that deficit spending is natural and necessary on an individual level. However, a more important part seems to be based on the general public's knowledge that the federal government is capable of doing a lot more good than it has done.

While I agree with the conventional wisdom that the budget should be kept balanced, it's clear that when the competing priorities are weighed against each other, Canadians want their federal government to start making up for the cuts of the '90s. It's up to the NDP to make the case that it's on side with 93% of Canadians in wanting both a balanced budget and a balanced society.

Monday, September 26, 2005

Crude measures

For all the justified skepticism as to whether or not the Iraq invasion was nothing but an oil grab, the L.A. Times points out reason to think that the oil-acquisition part of the war wasn't any better thought out than the rest of it:
Engineering mistakes, poor leadership and shifting priorities have delayed or led to the cancellation of several projects critical to restoring Iraq's oil industry, according to interviews with more than two dozen current and former U.S. and Iraqi officials and industry experts.

The troubles have been compounded in some cases by security issues, poor maintenance and disputes between the U.S. and its main contractor, Houston-based KBR, a subsidiary of Halliburton Corp., according to the interviews and documents.

Despite the United States' spending more than $1.3 billion, oil production remains below the estimated prewar level of 2.5 million barrels per day and well below a December 2004 goal of up to 3 million barrels per day.

Most amazingly, the problem isn't even primarily related to security issues, as most of the current oil production takes place in the relatively secure south of the country. Instead, the lack of production comes from the usual mix of individual patronage...
(R)ather than tapping Iraqi state oil company officials, the U.S. program was overseen by American officials with little experience in the oil industry. In an interview, one senior U.S. official managing part of the restoration effort jokingly described his knowledge level as "Oil for Dummies." contracts to Halliburton and friends...
Iraqi officials also said KBR relied too heavily on foreign contractors, conducted lengthy, unnecessary studies and failed to deliver promised equipment. They acknowledged that Iraq needed to spend more on its oil industry but wondered why the U.S. investment had not had more of an effect...

Other Iraqis said that the U.S. and KBR simply failed to deliver. "I think we had the worst quality of U.S. service, staff and companies," said Jaafar Altaie, who was a senior planner at the Oil Ministry.

...and a complete lack of planning:
The Army Corps of Engineers decided it would be quicker to run the pipelines under the riverbed instead of repairing the bridge. The agency ordered KBR to drill under the river despite warnings against such a route, said a Corps contracting official involved in the project. The official asked to remain anonymous, fearing retaliation from commanders.

Trouble began soon after the project started in January 2004. The soil was unstable, and a borehole drilled to hold the pipes collapsed. In an e-mail obtained by The Times, the contracting official described the project as "placing a pipe in a large box of marbles."

And the final result is that, in oil as in other areas, Iraq is now in even worse shape than it was prior to the invasion:
The lack of reliable water injection has led to a debate about whether Iraq's southern oil fields have been permanently damaged. Although nobody is sure, some oil experts fear that America's failure to fix the problems has worsened damage that may have occurred during Saddam Hussein's rule...

United Nations oil experts have told the U.S. government that some oil reservoirs in southern Iraq have been so badly managed that the Iraqis will be able to recover only between 15% to 25% of the oil, well below the industry standard of 35% to 60%, a recent Department of Energy report states.

No wonder Bushco is now calling for conservation while at the same time opening the taps to the Strategic Petroleum Reserve: something has to replace the Iraqi oil that's now less recoverable than it was three years ago. Because this time unlike so many others, another shipment of snake oil from the administration isn't cutting it.

Maybe enough, but far too late

It never ceases to amaze how long some issues have been ignored through the Liberals' 12 years in power. Thankfully, one of the most important looks like it's going to see some serious action this fall:
The federal government will spend at least an extra $1 billion to raise native living standards that have long embarrassed the Liberals, The Canadian Press has learned.

New funding for education, housing and other programs is to be announced Nov. 25, unless there's an early election, sources say. Prime Minister Paul Martin is to commit the extra cash when he meets with aboriginal leaders and the premiers in Kelowna, B.C.

It's far from clear that the amount committed will be enough to raise aboriginal living conditions near the level that most Canadians enjoy. And the article's mention that the money will be spread over a few years leads to concern that the funding will be diluted beyond recognition before it's ever put to any meaningful use. But even if the planned funding is nowhere near a full solution, it's at least a start.

In agreement

A scathing report came out today condemning the application of the Byrd amendment. Which wouldn't be surprising, if the report wasn't from the U.S.' Government Accountability Office:
A U.S. government study says a contentious law that allows American companies to profit from penalties levied on imports from Canada and other countries has created an unfair “millionaires' club.”...

Nearly half of the $1-billion (U.S.) in duty payments has gone to only five companies, and two-thirds of all payments have gone to only three industries.

Recipients do not use the money to create new jobs in the United States and some spend it on personal expenses, the report says.

The article notes that the softwood lumber tariff hasn't actually resulted in money being paid out to U.S. producers, but that the money now being held by U.S. customs pending resolution of the dispute dwarfs the amount paid out so far.

Based on the precedents noted in the report, there isn't any sound argument that any meaningfully large group of American, including U.S. lumber producers' employees, would benefit in the least from distribution of the softwood tariffs. The only real question in determining what to do with the money already collected is whether or not the U.S. wants to firmly entrench lumber producers in the "millionaires' club". And until the U.S. sends a signal that the previously agreed-upon flow of trade is more important than that club's expansion, there's no reason to listen to demands that Canada go back to the bargaining table.

Back to work

As far as I can tell, it's only been covered in the Leader-Post's news summaries. But there's good news for Regina city workers:
Workers for the City of Regina are heading back to work this morning after a tentative deal was reached yesterday.

City manager Bob Linner says he'll take the details of the agreement back to the mayor and council.

The union will present the deal to the 16-hundred workers to vote on later today.

It'll be very interesting to see the details of the deal, particularly in light of the city's position last week that the sides were too far apart to warrant the appointment of a conciliator. But whatever the outcome (assuming that both sides accept the negotiated deal), it's good news for the city employees to be back at work.

Tangible gains

John Ibbitson reports that corporate tax cuts are on hold at least until the next election, as the Liberals don't want to put their continued rule in the hands of the Cons.

This is great news for the NDP on a couple of levels. Most obviously, it's one more example of how the NDP has effectively used its leverage to tilt policy choices away from indiscriminate corporatism and toward its core constituencies, which happen to match the interests of most Canadians.

But on a more speculative level, this could be a turning point on the question of which party is best suited to offer a counterbalance to the Liberals coming out of the next election. By still refusing to cooperate even to pass policies they support even after a full summer of sober second thought, the Cons give the impression of having no desire to even participate in Parliament. This spring, there was at least ongoing testimony which could be cited regularly as a reason for the refusal to work with the Libs; now, there's really no excuse aside from sheer politics, and nobody besides the Cons sees any great need to hold an election in November rather than next year.

Meanwhile, any distinction on policy between the Cons and the Libs has to be reduced if a vote for either is seen as a vote for corporate tax cuts (among other generally similar platform planks). But even as those two parties agree on policy, it's also clear that the NDP's policy position is an entirely reasonable one. Investing elsewhere rather than in tax cuts must be an entirely mainstream choice given that neither the Libs nor the Cons want to go to any great effort to implement them. And it helps as well that the economy is doing just fine at current tax levels.

As an end result, the Cons look all the more like their own portrayal of the Libs: a group so driven by an attempt to win nominal power that it doesn't care whether Canada is effectively governed. And that has to make the NDP, with both a people-friendly policy package and a willingness to actually govern by consensus, look all the better as the true alternative to continued Liberal government.

Sunday, September 25, 2005

In denial

Tony Blair and John Reid respond publicly to the withdrawal story from earlier today:
Blair, a firm ally of President George W. Bush in the conflict, said he had not set a deadline for withdrawing some 8,500 British soldiers from Iraq...

Blair has faced repeated calls from political opponents to set out a timetable for withdrawing British troops from Iraq. A government memorandum leaked earlier this year shows Britain is considering scaling back its troop presence to 3,000 by the middle of next year.

But Defence Secretary John Reid insisted no date has been set, dismissing a report in The Observer newspaper Sunday that Britain was drawing up detailed plans to begin leaving in May.

The earlier story made it clear that conditions comparable to those discussed by Blair would be set on any withdrawal, making the new statements somewhat less than a complete denial. Even if any timetable is officially subordinate to an evaluation of conditions on the ground (as was already mentioned in the earlier story), the time now being put into withdrawal plans should at least help to shape that evaluation.

Although he does acknowledge in the article that he underestimated the strength of the insurgency, Blair hasn't conceded much yet on Iraq. But timetables and withdrawal plans have been topics for discussion for a good amount of time, and it appears they're well on the way to becoming something more concrete than that. Which means that if Blair wants to ignore them, he'll face an ever-more-difficult task trying to defend his actions.

Good signals

Question Period seems to have been particularly star-studded today - and it's a great sign that Jack not only gets the CTV headline, but sends exactly the right message:
Speaking on CTV's Question Period Sunday, Layton suggested that the NDP's continuing support for Paul Martin's minority government will depend in part on the Liberals' stance on medicare, gas prices and the environment...

Layton said the NDP would oppose any Liberal attempts to give corporations tax breaks and agreed that the government could fall if the issue became the subject of a confidence motion. Layton had insisted that a corporate tax break be dropped from the Liberals' last budget in return for NDP support.

"It's a bad policy," he told Question Period's Craig Oliver. "In fact, one of our candidates is the former chief economist of the Royal Bank...and he says what we need to do is not give more corporate tax breaks, but begin to invest in the key areas for the 21st century economy."

It's great to see the focus on the economic upside of progressive policies, though a tighter link between health care and economic opportunity would have been all the better. And more importantly, the theme of reasonable cooperation has been nothing but effective for Layton, especially when contrasted with the continued Con theme of blaming the other parties for getting things done.

The one part of Layton's appearance that has drawn some criticism is his desire to both reduce gas prices, and reduce greenhouse gas emissions. But that's not so much a contradiction as a matter of the proper means to reaching the end. There are ways to reduce emissions which don't harm consumers in the short term the way inflated gas prices do, and it's entirely fair to look to means those rather than to place the full impact of current gas prices on Canadians who haven't been able to plan for them.

Getting out

Word comes out today that Britain may start withdrawing troops from Iraq next year:
British troops will start a major withdrawal from Iraq next May under detailed plans on military disengagement to be published next month, The Observer can reveal.

The document being drawn up by the British government and the US will be presented to the Iraqi parliament in October and will spark fresh controversy over how long British troops will stay in the country. Tony Blair hopes that, despite continuing and widespread violence in Iraq, the move will show that there is progress following the conflict of 2003.

Britain has already privately informed Japan - which also has troops in Iraq - of its plans to begin withdrawing from southern Iraq in May, a move that officials in Tokyo say would make it impossible for their own 550 soldiers to remain.

The article doesn't make clear whether U.S. troops will also be involved in the planned drawdown. And it appears that withdrawal will be based only on meeting targets negotiated between the U.S., U.K. and Iraqi governments, which could slow down the process in a couple of ways.

First, Bush hasn't shown any willingness to set anything resembling a timetable for withdrawal, so his administration will likely demand impossible standards. We may be able to tell just how much control Iraq is allowed to have over its own affairs based on how much credence if given to the pro-withdrawal view within Iraq; unfortunately, it's tough to be optimistic at this point.

Second, as I've pointed out before, any withdrawal predicated on conditions within Iraq gives the insurgency the choice whether or not to allow any withdrawal...which may mean either delays, or less stability once the withdrawal happens.

Those problems aside, it's clear at least that the momentum has shifted: even the strongest non-U.S. supporter of the invasion is publicly acknowledging that it's time to get out. We'll see how long it takes the U.S. to reach the same conclusion.

Risky business

David Olive suggests that Bushco's track record could cause suspicions about businesspeople in government for a long time to come:
(F)uture historians will make the connection between the most CEO-heavy administration in memory, headed by the first MBA president (Harvard, no less), and a White House of unsurpassed fiscal recklessness, flawed strategic thinking, failure to execute even on its best ideas (its unrealized goals of education reform and energy self-sufficiency, for instance), and a stubborn unwillingness to change course when conditions dictate...

(A) sustainably prosperous business doesn't hand vital tasks to cronies, fail to vet its suppliers, starve essential employees of job fulfillment, or blame its shortcomings on bogeymen.

It's a pity the GOP running mates didn't say what kind of business they had in mind — the managerial prowess of a General Electric Co., or the train-wreck of Enron Corp.

Amen to that. Olive points out the unfairness in tarring all CEOs with the same brush when a good number of Bushco's members either filled the role in name only, or were miserable failures in the job. But Bush has ultimately turned the usual stereotypes of business and government on their head, having replaced the relatively non-partisan and merit-based civil service inherited from Clinton with "businessmen" who have shown precious little competence at anything other than turning every arm of the government into a partisan tool. And there's no way to avoid noticing a pattern among the people involved.

There's going to be an awful lot of damage to repair. But the counterbalance to that is that whatever part of the ugly truth hasn't yet surfaced will come out once Bush is out of power. And once voters know the true damage, that should help ensure a healthy suspicion toward anybody pushing a similar form of government.