Medical negligence

I don't imagine there are many multi-billion public programs which operate without any audit process. But thanks to delay by the McGuinty government in implementing a new audit program to replace one that was eliminated in 2004, Ontario's OHIP medical billing program fits that description. And it seems all too likely that if the lack of any control on spending continues for too long, the result will be to create an incentive for unnecessary billing - and to make costs of the public health system look significantly worse than they would if Ontario's Libs had acted when an obvious need was identified.

On dangerous protection

Thomas Walkom points out that last week's decision quashing search warrants against Ottawa Citizen reporter Juliet O'Neill may not have wound up protecting a particularly merit-worthy journalistic source:

Amidst the media self-congratulation over an Ontario Superior Court judge's decision this week to uphold freedom of the press, one fact is rarely mentioned: The substance of the Ottawa Citizen report at the centre of this controversy was inaccurate.

What's more, if an earlier judicial inquiry can be believed, whoever leaked the information — or more properly disinformation — reported in the Citizen was trying to discredit Maher Arar, someone who had already been unjustly maligned, imprisoned and tortured.

Is this really a press victory?...

Most journalists, including this writer, make use of anonymous sources. We try to verify what they say. But ultimately — particularly in areas where hard evidence is difficult to come by — we have to rely on faith that they are telling the truth.

Unfortunately, sometimes they are not. The 2003 Citizen story was one of those cases.

Some of what her anonymous sources provided to O'Neill did turn out to be accurate. Justice Dennis O'Connor's inquiry into the Arar matter concluded that the Canadian computer engineer did indeed come to Mounties' attention when they spotted him talking to someone they had under surveillance.

But O'Connor also concluded there was absolutely no basis in fact to the more sensational allegations repeated in the Citizen piece. He said Arar was never a jihadist, that he was not linked to Al Qaeda, that he had not trained in an Afghan terrorist camp and that he had not "disappeared" from Canada to avoid being interviewed by the RCMP...

When O'Neill's story broke, the RCMP — to their credit — were desperate to discover who was leaking this damaging disinformation. But their subsequent raid on O'Neill's home raised such a storm that the then-Liberal government felt compelled to call the judicial inquiry it had been trying to avoid. (It was that raid that Justice Lynn Ratushny, citing freedom of the press, declared unconstitutional on Thursday).

Of course, in future cases it's quite possible that the decision will wind up assisting sources whose information more thoroughly deserves protection, and helping to strengthen the ability of the press to investigate wrongdoing. And there's no doubt that this is one of the areas where the knee-jerk reaction to 9/11 may have gone too far.

But as pointed out by Walkom, the story is far from one-sided. It's not hard to see the similarities between this story and the U.S. Judith Miller fiasco in which "journalistic integrity" was cited as a reason to avoid outing even sources whose information had been entirely disproven. And if the effect of Ratushny's decision is to strengthen confidentiality between propagandists and the journalists who use their information for easy stories rather than for the sake of actually investigating, it's hard to see who besides the purveyors of misinformation could stand to gain in the long run.

Approaching the wall

The National Post reports on the increase in middle-class bankruptcies in the U.K. and U.S., and notes that Canada may be next in line to see a massive increase in credit card-related bankruptcy:

Recent reports in the United Kingdom and United States indicate that cases of personal bankruptcy among the middle class are on the rise. And with skyrocketing debt-to-income ratios here, Canada could be next.

"The situation has never been so grave," says Laurie Campbell, executive director of Credit Counselling Service of Toronto, Credit Canada, a not-for-profit organization that helps people in financial trouble.

According to statistics released by Britain's Bankruptcy Service, 26,021 people were made insolvent in the second quarter of 2006, a 66% increase over the same period last year. A separate study by a professor at Britain's Kingston University found a staggering 49% of insolvencies to be middle-class people who got into trouble over credit-card debt, compared with 16% of respondents who said they were bankrupt as a result of a business failure.

Similar trends are underway south of the border. A recent U.S. study warns of rising consumer bankruptcy filings in the years ahead -- despite laws passed last year aimed at discouraging them. The Bankruptcy Abuse Prevention and Consumer Protection Act, which took effect last October, aims to curb consumer bankruptcy filings by closing loopholes that allowed for opportunistic filings, serial filings and abuse. The new law also created new responsibilities for those who administer consumer bankruptcies and those who counsel debtors into bankruptcy.

But the study, by a law professor at the University of Illinois, found the law has done little to tackle the problem of growing consumer debt burdens, and suggests that personal bankruptcies will return to levels that existed before it came into place.

In Canada, the number of personal bankruptcies has in fact dropped in recent years, thanks largely to a strong economy and low interest rates. In the second quarter of 2006, for example, the total number of new bankruptcy filings was 9.2% lower than the year before, according to Industry Canada. For 2006 as a whole, filings are down 6.2%.

But those numbers hide a deeper problem. On average, Canadian households owe more than their annual income. In the first quarter of 2006, the debt-to-income ratio reached 120%, the 20th consecutive quarter the indebtedness ratio has risen.

Marvin Zweig, a principal at bankruptcy trustee firm Shiner Kideckel Zweig Inc., warns that as the economy slows and interest rates rise, the number of personal bankruptcies will climb. "The global economy is possibly heading into a soft period. That will include Canada," he says. "You are going to find people who are affected from an income perspective. They will then resort to using their available credit to finance their necessary living expenses. And, it just continues to rise from there."

What's worse, the problem may be even closer at hand than the article suggests, as the economy already appears to be softening. And once the first wave of increased bankruptcies hits, it's all too likely that the effect will be a tightening of credit which in turn restricts the economy even more.

Unfortunately, far too many Canadians have been spending beyond their sustainable means during a boom period...which is bound to lead to problems when the boom comes to an end. And while it may not be too late to change course now, it won't likely be long before individual Canadians and the economy generally run head-first into the current wall of consumer debt.

On developing movements

Both Ontario and Quebec are rightfully pointing out that the Cons' Unclear Air Act falls far short of even the Libs' pitiful actions against global warming by including no funding at all to enable provinces to cut their greenhouse gas emissions:

Canada's two biggest provinces are upset that the Conservative clean air plan doesn't mention multi-million-dollar promises made by the previous Liberal government to help curb air pollution.

Ontario and Quebec say they expect the Tories to pay up. The Clean Air Act released this week contained many promises of consultation and regulation, but there was no word of federal funding to help provinces move to a low-polluting economy...

Ontario had a $538 million agreement with the federal government to help close the province's dirty coal-fired power plants. Closing the plants would cut greenhouse emissions by 30 megatonnes annually, said Broten.

"We've committed to close coal. That's the single largest greenhouse gas reduction initiative in North America."...

Quebec had been counting on $328 million promised by the government to help finance the provincial climate plan, but unlike Ontario it did not have a formal agreement.

Federal Transport Minister Lawrence Cannon, the political minister for Quebec, has said the promise is off, but Quebec Environment Minister Claude Bechard continues to press the issue.

"We are not giving up," said Bechard's spokesman Pascal D'Astous.

Other provinces were also looking for money from the now-defunct $10-billion fund, and hope the current government has not said the last word on funding for clean air.

It seems far too likely that the last word has indeed been said for as long as the Cons stay in power, as the issue will be left on the back burner for several years of consultation and probably ignored at that point. But then, there's always the option of replacing the Cons with a more sensible government before we reach that point...and with the provinces recognizing just how much worse the fiscal imbalance is becoming as a result of the Cons' all-responsibility, no-funding strategy, that may become a reality all the sooner.

On unnecessary burdens

While Peter MacKay's presence in the news over the last couple of days has been mostly due to several painful bouts of foot-in-mouth disease, CanWest reports that buried beneath the careless talk came another announcement of yet more Canadian troops being sent into combat in Afghanistan:

Members of the newly formed special forces regiment based at CFB Petawawa, Ont., are heading to Afghanistan as Canada continues to bolster its commitment to the war in the southwest Asian country and the NATO allies are urged to assume more of the military burden there...

Canadian Forces spokesman Maj. Doug Allison said the military will not discuss how many members of the special operations regiment are being sent to Afghanistan or when they will leave for that country.

"We anticipate in the near term that the regiment will make a contribution to the Canadian SOF (special operations force) efforts within Afghanistan," said Allison. "They will take part in the full spectrum of special operations contributing to the overall efforts in Afghanistan."

The deployment of more Canadian troops was revealed as Foreign Affairs Minister Peter MacKay told a roomful of NATO ambassadors that Canada can't keep up its efforts in Afghanistan without more help.

Based on the rest of the article, it's clear that the Cons' consistent record of tossing more and more troops into Afghanistan isn't giving Canada any ability to lead other countries to contribute more. Instead, it's placing more and more of the burden on Canada to no gain for the mission generally, as other countries have the good sense to move their special forces or other troops out of the region. And with Canada paying an ever-higher price for an ever-less-realistic mission, it likely won't take long for Canadians to demand that same good sense from their own government.

The wrong prescription

While there's been plenty of well-deserved outrage about the Cons' refusal to do anything to meaningfully improve the environment, there's been far too little over their active steps to make health care worse by making pharmaceuticals more expensive:

Yesterday’s changes to pharmaceutical regulations will hit Canadians right in their pocketbook, says the NDP Critic for Health.

Penny Priddy, MP (Surrey North) was reacting to the Conservatives’ announcement that name-brand drug companies will be now be granted eight years of exclusive selling rights — up from the previous five years.

“The Conservatives have given an early Christmas gift to their friends in the big drug companies,” said Priddy. “These changes mean today’s families will pay higher costs for prescription drugs, and for a longer period of time.”

Priddy quoted the Canadian Generic Pharmaceutical Association’s estimate that the Conservatives’ changes would have added $600-million to drug costs had they been in effect over the past five years.

It's worth noting that while some consumers will feel the pain, a good chunk of the costs will be borne by governments - particularly those provinces which have been forward-thinking enough to provide meaningful drug plans for their citizens. And now that the Cons have deliberately raised prices for no reason but to appease big pharma, there's no longer any reason for hope that they might see the light about the value of trying to reduce costs through a national plan.

We'll have to wait and see how long it takes the party which is working to increase health care costs to then complain that the costs are unsustainable. But it's clear that the Cons are doing their best to undermine affordable health care without attracting public attention - and that they can't be allowed to get away with it.

Clearing the air

The Cons' Unclean Air Act may have been predictably devoid of worthwhile ideas. But fortunately, the same isn't true for the Conservation Voters of B.C., whose plan appears to be the needed first step to getting greenhouse gas emissions (along with so many other problems) under control.

Defending the indefensible

Last time the Cons decided to put on a PR offensive against peace talks in Afghanistan, it took a matter of hours for their claims to be completely and utterly debunked, and only a few weeks before even the U.S. and the U.K. publicly noted just how far off base the Cons were. But apparently Peter MacKay is looking to embarrass himself and his party yet again by pretending that what's already being done (and for good reason) is beyond the realm of possibility:

Foreign Affairs Minister Peter MacKay is accusing the New Democrats of demoralizing Canadian troops in Afghanistan with talk of withdrawing them from combat.

MacKay says in a speech to the Canadian International Centre that calling for peace talks with the Taliban -- a suggestion made by NDP Leader Jack Layton -- only makes insurgents bolder.

Although he doesn't refer to Layton by name, MacKay says there are some who believe they can wave a magic wand and make the insurgency disappear.

That's "naive," he says.

Granted, MacKay didn't name names this time - meaning that he could well be taken to be bashing the U.S. and the U.K. as well as the NDP. But it seems far more likely that he's simply papering over (or wilfully ignoring) the reality that talks are necessary both to limiting the humanitarian damage in the short term, and securing peace in the long run.

Based on their retreat into long-demolished positions, it's more obvious than ever that it's the Cons who are living in a fantasy world. Which can only have Canadians looking forward to giving the reins to a party whose position is based in reality rather than fiction.

One member, seven votes

The National Post reports that Quebec delegate selection in the Lib leadership race was based in many cases on an exceedingly small number of votes, including one riding where two people elected a slate of 14 delegates:

In one northern Quebec riding, just two federal Liberals bothered to vote in recent delegate elections, but their votes sure counted. Together, they elected a slate of 14 delegates to support Bob Rae at the leadership convention in early December.

In other Quebec ridings, the turnout of Liberal members was barely better, according to Liberal sources.

Fewer than 100 members cast ballots in at least seven other ridings in the province, including several in and around Montreal -- the party's last Quebec toehold. But under party rules, each riding sends 14 delegates to the convention, regardless of whether two people or 200 people voted...

Other low turnouts, according to a Liberal source familiar with the results, included the ridings of Repentigny, where 18 people voted, Vercheres-Les Patriotes (21 voters), Beauce (22 voters), Beauharnois-Salaberry (42 voters), Compton-Stanstead (45 voters), Trois-Rivieres (57 voters) and Notre-Dame-de-Grace-Lachine (94 voters).

One would think the Libs would want to open up the process enough both to show some examples of better turnout, and to suggest ways to get people more interested. But sadly, the Libs instead seem to have bought into the Con view that it's better to try to suppress the facts than deal with them:

Party officials in Ottawa have declared that no official numbers will be released on voter turnout during the Liberals' "Super Weekend," on Sept. 29-Oct. 1, to choose convention delegates. But the leadership camps are aware of the tallies and recognize that Quebec turnout was particularly low...

Tait Simpson, a national spokesman for the party, said the party considers the voter turnout an internal matter. "It's none of anybody's business. We don't have to release it and we're not going to," he said.

It's true enough (as argued by another Lib spokesperson) that some aberrations are likely to pop up in any campaign, with the result that the ridings in question shouldn't be seen as a severe distortion of the leadership race generally.

But from an organizational standpoint, it's still remarkable that some ridings seem to have completely escaped both the efforts of the leadership campaigns, and enough individual interest to lead to a reasonable turnout - particularly in ridings which had upwards of 6,000 Lib voters just months ago. And based on that lack of interest, it's far from certain that the Libs are sufficiently organized or motivated to capitalize on the Cons' current free-fall.

Lives lost to politics

CBC reports that while the Cons may have gone over the top with their jingoistic rhetoric on Afghanistan, the initial decision to expand the mission far beyond Canada's realistic capabilities dates back to Jean Chretien:

The former Liberal government led by Jean Chrétien rejected the advice of military commanders by deciding in early 2003 to send 2,000 troops to Afghanistan, CBC News has learned.

In the aftermath of the Sept. 11 attacks, Canada had sent several hundred soldiers to assist U.S. troops in tracking down al-Qaeda militants in Afghanistan. When that mission ended, senior military officers recommended that Canada send only 500 soldiers in a very limited role — but Ottawa chose instead to deploy 2,000 troops.

The commander of the army at the time, Lt.-Gen. Mike Jeffrey, said he told the chief of defence staff that his forces weren't ready for a significant mission overseas...

He said the announcement of Canada's plans to send a battle group to Afghanistan — made in the House of Commons on Feb. 12, 2003 — took him completely by surprise...

Jeffrey said there were concerns about Canada's role and the command structure of the international force that was to stabilize Afghanistan.

"I could see Canadian soldiers dying," he said, "because they weren't properly prepared. It wasn't that we weren't prepared at some level to go. It's that the risks were too high."...

"Governments decide where the military goes, the military doesn't decide where it goes," Goldenberg told the CBC.

"Imagine the reaction in Canada and around the world if Canada had refused to be part of an international coalition after September 11th."

As the article notes, it was purely a political calculation that led to the conclusion that more troops should be sent - regardless of whether they were reasonably equipped for the mission. And Goldenberg's justification for the decision is even less reasonable than the Cons' usual rationalizations for expanding the mission, as there's no reason to believe that a deployment which would actually have fit Canada's capabilities would have been taken as a "refusal" to participate.

Of course, the lack of focus and oversight has only gotten worse since the Cons took over the helm. But it's clearer than ever that the Libs were the first to lock Canada into an unnecessarily dangerous mission for no reason other than international peer pressure. And that can only ensure that the Libs lack any credibility in questioning PMS' own willingness to bow down before Bushco and other foreign administrations.

On purges

Back when the Cons first announced their decision to allow nomination challenges to their sitting MPs, I theorized that the party machinery would be more likely to support relatively moderate candidates against the looniest of the right-wing loons than to try to drive out Garth Turner and his ilk. But with Turner's expulsion following the Cons' efforts to protect Rob Anders and company, it's looking more and more likely that the worst fears about the nomination process were true - and that Rahim Jaffer and the Con caucus merely did today what the Cons may have hoped a nomination meeting would do earlier.

Preaching to the unconverted

It may not be quite as exciting as the Cons' decision to expel their own internal whistleblower. But there is more substantive news happening today as well, as a seniors' group and the NDP are calling for a moratorium on income trust conversions until the effects of income trusts are better understood:

Income trusts are costing billions in lost government revenue and are “misleading” senior citizens, said a pensioners' group that is calling for all future conversions to be halted.

The National Pensioners and Senior Citizens Federation, which says it represents about one million people, is upset because so-called tax leakages mean less federal money will be available for health care and social security. They also believe a federal regulator should be established to monitor trusts more closely.

“A lot of seniors are being taken in on this because they are not getting the yields that they thought they were going to get,” Art Field, the organization's president, said in an interview from Ottawa. “We want regulations to police the income trust area, to police it if people are losing their money. There are regulators for all kind of things, but there don't seem to be any for income trusts.”...

The federation wants a national investor protection agency and an independent accounting standards board established to monitor trusts more closely. Trusts are currently worth $200-billion on the Toronto Stock Exchange.

NDP finance critic Judy Wasylycia-Leis, an MP from Winnipeg, is calling for a moratorium on any further income trust conversions, saying there needs to be a serious study on their impact before any more companies are allowed to proceed...

“The concern is that many income trusts are being overvalued, that there is a gap between what they actually hold and what they are committed to paying out,” she said. “If we tighten the rules up a bit, we could play a role in protecting people.”

Unfortunately, the Cons seem perfectly happy to let the problem spiral even further out of control. And it seems far too unlikely that the Libs will want anything to do with the constructive side of the income trust issue given the phrase's link to their last electoral defeat.

But the reality is that income trusts may currently pose threats to Canada's investors and citizens alike. And if neither the Cons nor the Libs are willing to pay attention to the dangers, at least Canadians will know where to turn for leadership on issues which may affect their retirement plans on many levels.

True colours

Even with the federal Libs in opposition and thus putting on their best left-wing act, Canadians can still observe a prime example of the party's right-wing governing style, as Canada's largest remaining Lib government is pushing to join in on the highly-flawed TILMA:

Ontario Premier Dalton McGuinty says he wants in on the free-trade agreement signed earlier this year by British Columbia and Alberta.

McGuinty, who met with B.C. Premier Gordon Campbell earlier this week to discuss the deal struck by the two western provinces, said Tuesday that he emerged more enthusiastic than ever about joining the club.

"(The Alberta-B.C. accord) has been very well received by Albertans and British Columbians alike, notwithstanding some of the concerns raised by various groups. For us here in Ontario, undoubtedly there will be some concerns raised by some labour groups for example," McGuinty told reporters.

"(But) the issue is whether or not we think that we're strong enough to compete - whether we can be seen as an attractive jurisdiction for investment and for workers. I think it's a step in the right direction for us to move toward ultimately a state where there is free trade actually within this country."

Now, it's enough of a problem that McGuinty appears willing to take Gordon Campbell's word on anything. But the problems with TILMA from Ontario's standpoint are even more obvious than for most provinces, as the article notes that much of Ontario's successful strategy for attracting auto-sector investment would be outlawed by the deal.

The question isn't whether Ontario or any other province is "strong" enough to compete, or even whether harmonizing standards is a good idea (which indeed it generally is). Instead, the larger issue underlying TILMA is the wilful erosion of government's ability to govern in the interests of a province. And with Canada's most powerful Lib showing the party's true colours by trying to get out of the business of governing, it'll be all the tougher for the federal party to keep pretending that it disagrees with the federal Cons' moves in the same direction.

Battles won and battles yet to come

As noted by Red Tory at babble, there's been awfully little attention to the fact that Canada won another round of softwood lumber litigation last week even as the Cons were trying to fully implement their sellout. But with Gordon Gibson highlighting that fact in the Globe and Mail, Canadians may soon get yet another reminder of just how many gains the Cons were eager to bargain away:

Eat a lot of crow, convince us we should walk away from a billion dollars, or face a dangerous election issue? These are the unattractive choices facing the Harper government after a huge lumber industry victory in the U.S. Court of International Trade (CIT) last Friday.

That court ruled we are entitled to the return of every penny of the $5.3-billion of illegally imposed duties on our softwood exports over the years, as well as free entry of our products. But in the recent "Softwood Sellout Agreement," Ottawa said it would forgo $1-billion of the total duties owed it and agreed to a new border charge as high as 22.5 per cent.

Gibson notes that even if the Bloc continues to inexplicably side with the Cons in the House of Commons, there's always the potential for the Senate to refuse to go along with the Cons' effort to snatch defeat from the jaws of victory. And unlike the Accountability Act, this is an issue where a Senate standoff would likely further damage the Cons' popularity rather than working to the detriment of the Libs.

Of course, PMS has been far better on politics than policy so far, and may yet be able to rattle enough sabres against the Senate to push the measure through. But it's doubtful that many Canadians will be eager to hand Harper a majority solely for the sake of allowing him to continue giving gifts to his soulmate to the south...meaning that PMS could easily end up on the wrong side of his usual brinksmanship if the Libs in the Senate are paying enough attention.

(Edit: corrected source in first paragraph.)

On united opposition

The Cons may be doing their best to try to silence the Canadian Wheat Board. But with all three opposition parties now lined up against the Cons' attempts to do so, there's no prospect of the interests of farmers going unrepresented no matter how much the Cons try to muzzle the Board itself. And the longer that continues, the more likely it is that the Cons will realize that a minority government may not be the best time to alienate a good chunk of their core supporters.

Predictable results

The Bank of Canada is forecasting that the result of a tax-cutting, program-axing, Buscho-appeasing government will be less economic growth than previously projected. Which should be Jean-Pierre Blackburn's cue to once again search for a way to blame the environment.

On comparisons

The director of the British Antarctic Survey makes the much-needed comparison between global warming and terrorism, noting that despite the disproportionate amount of attention given to the latter, the dangers of climate change are far greater:

Governments need to fight climate change at least as much as they combat terrorism, said the leader of Britain's environmental research in Antarctica, since a warming climate would be more harmful than any terror attack.

"The impact of terrorism affects hundreds or thousands, or maybe...a million" victims, said Chris Rapley, director of the British Antarctic Survey. He was in London the day of the July 2005, bombings.

"But the product, probability and impact of climate change is greater," he said in a lecture Monday at the National Research Council in Ottawa.

"And yet one doesn't see a government anywhere putting an equivalent amount of effort into protecting its citizens from that."

It's all the more sad that our current federal government doesn't seem interested in making any effort at all in dealing with the more serious issue. But when even those who have been close to the effects of terrorism can appreciate the greater threat posed by the damage we're doing to our own planet, it should be fairly clear what should be the higher priority for any government truly interested in the well-being of its citizens.

On spending priorities

There shouldn't be much doubt left as to whether the Cons were really pushing ahead with further combat in Afghanistan for the sake of assisting reconstruction, or solely in order to appease Bushco. But to put any such doubt to rest, the CP reports that while combat has done nothing but expand since the Cons took power, money earmarked for reconstruction in Afghanistan isn't actually being spent.

Needless to say, the contrast is rather stark against the Cons' plan to ram through sole-source defence spending which won't be of any benefit in Afghanistan. And the only available conclusion is that reconstruction in Afghanistan is merely an excuse to go on pouring money and troops into the country and into the military generally - not a goal which the Cons are remotely serious about pursuing.

Taxing decisions

Apparently Jim Flaherty hasn't made up his mind as to whether he thinks provinces should raise their taxes or cut them: last week it was the former, this week it's the latter. But his mind is absolutely made up that he thinks his own government can do nothing better than to continue arbitrarily hacking away at taxes - which should be ample reason to take the keys away from the do-nothing Cons.

The selloff begins

The Globe and Mail reports that the Cons may look to use jurisdictional excuses as a basis to privatize the Canada Mortgage and Housing Corporation:

The federal government is quietly testing the waters about privatizing the national housing agency, Canada Mortgage and Housing Corp. — a move that could bring billions of dollars into Ottawa's coffers but would also upset social-housing advocates and possibly cause upheaval in the bond market...

CMHC, a Crown corporation charged with making housing more affordable and accessible, is making about $1-billion a year in profit and is sitting on a $5-billion reserve of retained profits.

Those reserves are expected to rise to $9.5-billion within four years, according to the agency's corporate plan...

(T)he federal government has signalled it wants out of the housing business altogether, arguing that it's a provincial responsibility.

The solution to these pressures, sources say, could be privatization: selling the commercial parts of the agency to the private sector and keeping the social-housing parts of the corporation within government for now.

“Trial balloons are being floated around” and can be traced back to Finance Minister Jim Flaherty's office, one Bay Street source said...

(T)here are several key reasons that privatization of CMHC could well be rejected as a viable option.

For one, capital markets are hooked on the agency's bonds. While proponents of privatization argue that the markets will just have to learn to live with fewer government-backed securities and make do with the ample supply of corporate bonds, there are signs that the Bank of Canada and the federal government wish to keep the government bond market highly liquid.

Plus, there's no guarantee that a sale of CMHC would be as successful as hoped. An auction would have to bring Ottawa a lump sum that more than makes up for CMHC's substantial revenue stream.

Privatizing CMHC would also be politically sensitive. Social-housing advocates fear that government support for affordable housing would get short shrift. “Behind this maze of commercialization, cost-cutting, downloading and competition are some very important questions about social housing,” says Michael Shapcott, a senior fellow at Toronto's Wellesley Institute.

CMHC's president, Karen Kinsley, argues in defence of her agency. About one-third of CMHC's insurance customers are people or organizations that the private-sector — Genworth, for now — won't touch, she said.

It's downright amazing that the current status of the CMHC would be seen as a problem. Surely a Crown corporation which generates profits, offers needed services to more people than would be served by the private sector, and also provides a means to address social issues should be seen as an example to be emulated rather than a flaw to be "fixed" through privatization.

But for the Cons, the prospect of a one-time payout (with its concurrent destruction of a federal government role) is apparently seen as more useful than the ongoing profit stream. And with the profitable side of CMHC thrown out the window and the payout presumably burned on yet more random tax credits, the Cons would be able to cry poverty themselves when needed social housing is brought up as an issue.

It's not clear from the article what type of process would need to be followed to allow for privatization, and it's hard to see why any of the opposition parties would be willing to play along. But if Flaherty is already floating trial balloons even in a minority situation, there can be no doubt that a majority Con government would be quick to sell off the CMHC...and that the next election may be the only chance for Canadians to keep that from happening.

Black thumbs

Another day, another couple of asinine Con comments on the environment. First, there's federal Labour Minister Jean-Pierre Blackburn, who doesn't think environmental progress is worth bothering with if a single business can find something to complain about in the effort:

Protecting the environment is important, but it shouldn't come at the cost of Canadian businesses, says federal Labour Minister Jean-Pierre Blackburn...

"You have to be pro-environment, but it's also necessary to go ahead in a flexible, measured manner so that businesses don't start an uproar," Blackburn told The Canadian Press.

The minister, who is from Quebec, cited the current crisis in his home province's forestry industry as an example of excessive conservation.

Last week alone, eight Quebec sawmills closed, cutting more than 1,600 jobs.

Blackburn said the industry is suffering from the effects of a 2004 decision by the Quebec government to reduce the size of logging areas, made following a campaign led by Quebec singer Richard Desjardins.

I'm not sure that admonition against ignoring the "log in your own (eye)" has ever been quite this appropriate. But the Cons' contempt for the environment can be readily seen in their willingness to make it a scapegoat for job losses which can be directly traced to their own war against the Canadian lumber industry. (And it's worth noting that the job losses have extended far beyond Quebec, meaning that Jean Charest's forestry policy doesn't do a thing to get the Cons off the hook based on even a cursory look at actual evidence.)

Meanwhile, it's also rather curious that the business uproar against Con strongarming apparently isn't a problem for Blackburn. But then, the appearance of machismo may well be the one thing that trumps even the almighty dollar for PMS.

Also today, Rona Ambrose appeared on Question Period...but it's not quite clear just what question she thought she was answering:

Ambrose revealed few details, but promised (the Cons' Clean Air Act) will contain measures to regulate greenhouse gases for industry and said there is a direct link between GHGs and global warming.

"They're not separate issues. When you attack global warming, you attack greenhouse gases. You can't separate the two of them from each other," Ambrose said.

The problem, of course, is that absolutely nobody with a shred of credibility has suggested otherwise. In fact, the closest thing to such a claim has come from the Cons themselves, who have gone out of their way to answer questions about global warming by changing the subject to smog, Lib inaction, or any other topic they can think of which will distract the listener from the Cons' unwillingness to actually reduce greenhouse gas emissions.

Which means that Ambrose's answer is at best an acknowledgement that she's had no idea what she's been talking about ever since taking office. And at worst, it sounds like an attempt to pretend that there's actually some need to argue against the position that global warming should instead be addressed through, say, a deployment of additional troops to Afghanistan - or perhaps another round of interminable consultations.

In sum, even PMS' notoriously-whipped cabinet doesn't seem able to avoid showing its disdain for both the environment in general, and the current state of knowledge about it in particular. And we can only hope that means that the environmentally-conscious Canadian public will vote to put a more responsible party in charge before the Cons manage to go downhill even further.

Zero is a stable number

In trying to excuse their softwood-lumber capitulation to the U.S. (and ensuing bullying of Canadians to accept the deal), the Cons eventually settled on the need for "stability" in the lumber industry. Now, Jean Charest makes clear just what kind of situation has become the "stable" status quo in Quebec:

Quebec Premier Jean Charest said Saturday the provincial government is preparing a plan to deal with the mounting crisis in Quebec's forestry industry, but was unready to provide details.

He did indicate that government action will be focused on assisting the hundreds of industry workers that that saw their jobs disappear in a recent spate of plant closures across Quebec a crisis that Charest calls the worst the industry has faced in the history of the province.

It's still not quite clear just who was clamoring for certain defeat rather than facing the risk of victory in continued litigation. But it's clear now that having seen the "stable" future forced upon them by PMS, Canada's employers have decided that they're sure enough that they can't compete to justify eliminating large chunks of the industry. And the investors, employees and communities alike who are suffering from those decisions can't be blamed if they'd like to give the Cons a nice, stable position far away from the government benches at the first available opportunity.

Let's be charitable

The latest Volpe scandal (involving money and staff obtained through a charitable foundation) looks even worse the previous ones at first glance. But in fairness to the Volpe campaign, doesn't he likely qualify as a charity case in any event?