Parliament in Review: November 21, 2011

Monday, November 21 featured the final day of debate on the Harper Cons' omnibus budget bill.

The Big Issue

Not surprisingly, the final day of debate on budget legislation gave rise to plenty of clash, with Peter Julian offering up the best summary of the contrasting positions:

What the Conservatives are saying is that the tens of thousands of seniors living in poverty in the country need to continue living in poverty because it wants to bring in more corporate tax cuts. It is saying to the one million Canadians who rely on food banks just to get through the month that they will need to keep going to food banks because it wants to bring in more corporate tax cuts. It is saying to the 72,000 Canadians who lost full-time jobs in the month of October, almost half of whom will not have access to employment insurance, that it needs to cut their benefits so that it can bring in this further corporate tax cut.
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It is the middle-class and poor Canadian families who are paying the price for the government's irresponsible attitude when it comes to fiscal policy in the country.

Julian likewise contrasted continued tax giveaways to the corporate sector against the Cons' imposition of austerity on actual citizens, while Wayne Marston added up the cumulative effect of Lib and Con corporate tax cuts over the course of over a decade. Marjolaine Boutin-Sweet and Alain Giguere noted that the Cons' gratuitous cuts are turning Canada toward the Greek Syndrome that the government is supposedly trying to avoid. Scott Brison criticized the Cons' tax credits for being targeted to avoid anybody who actually needs help, while Alain Giguere added that needlessly complex application processes will keep hundreds of thousands of seniors from receiving the Guaranteed Income Supplement. Kirsty Duncan proposed children's nutrition funding as a far better investment than the Cons' trinkets and baubles. Alexandre Boulerice pointed out that even the IMF has recognized inequality as a serious issue that demands action, while lamenting the Cons' focus on short-term political interests rather than long-term planning. Marston and Francois Choquette pointed out that a job creation tax credit would do far more for Canadian workers than the Cons' unfocused tax hacking. Marston also called for a boost to the Canada Pension Plan, while noting that the Cons chose not to bother when there was plenty of provincial demand for action. Raymond Cote rightly criticized the Cons' now-defunct transit tax credit as having been utterly useless when it came to actually providing transit, and suggested that we shouldn't turning our economy over to the Gordon Gekkos of the world. Nycole Turmel suggested that the Cons pair their new regulatory requirements with desperately-needed investment in infrastructure. And Jean Crowder pointed out that the Cons' "jobs! jobs! jobs!" spin is far from a full answer to economic issues when the jobs actually created aren't enough to keep a worker or family out of grinding poverty.

For the Cons, Colin Mayes honestly seemed to think Julian would be able to do nothing but proclaim the Cons' brilliance in mentioning their softwood lumber sellout - only to be met with the reality of 50,000 lost forestry jobs as a result. Royal Galipeau made it clear that as far as he's concerned, Canadians should expect to fend for themselves. And Cheryl Gallant delivered a remarkable paean to the hundreds of millions of dollars the Cons have thrown into AECL even while selling it off.

Finally, Elizabeth May attempted one last time to challenge the Cons' choice to attack per-vote funding rather than exceedingly generous donation tax credits that disproprotionately help the Cons, only to be told by Randy Hoback that it had been decreed thus from on high - and in keeping with that theme, the bill passed at third reading.

Tomorrow's News Today

Once again, the NDP identified a significant story months before the media seems to have caught on, as Jasbir Sandhu and Sylvain Chicoine both questioned the politicization of RCMP communications months before the story found its way into the press. But in fairness, I'm sure plenty of media observers were once again too busy writing about how little they've seen from the NDP opposition to notice what was actually happening.

In Brief

Helene Laverdiere wondered whether the Cons' call for strong action against Syria would include any limitations on the business done there by Suncor - and Bob Dechert's answer strongly suggested otherwise. Peter MacKay answered a question from John McKay by stating that there's no expectation of reaching initial operating capability with F-35s anytime before 2020 - calling into question why there wouldn't be time to properly consider Canada's options before then. Don Davies introduced a bill to remove federal sales taxes on energy-efficient products. Dan Harris provided a few current cabinet ministers' greatest hits decrying closure and time allocation under past governments before they became Canada's leading offenders in that department. Ruth Ellen Brosseau highlighted the increase in food bank use under the Cons. Andrew Scheer issued his ruling on the Cons' refusal to respect judicial independence, choosing to punt the issue back to committee rather than addressing the problem. Tyrone Benskin called for the Cons to recognize the value of crime prevention rather than focusing stubbornly on punishment, while Francis Scarpaleggia questioned whether officials from municipalities who can't afford new wastewater requirements might be joining the new crowd in Canadian prisons. Peter Stoffer spoke to his private member's bill to stop pension clawbacks for Canadian veterans. Tarik Brahmi tried again to get some answers about the Cons' failure to do anything to rein in credit-card gauging, only to be told by Eve Adams that tax slashing for the wealthy is basically the same thing as consumer protection. Charlie Angus and Alexandre Boulerice questioned some of the new revelations about Tony Clement's G8 porkfest. Anne Minh-Thu Quach wondered why the Cons chose to have health funding studied by unelected non-representatives in the Senate rather than a Commons committee. Justin Trudeau tested whether Peter Kent would go off message long enough to demonstrate basic knowledge about ozone issues; needless to say, Kent failed miserably. Julian suggested the Cons stop asking Canadians to play retirement roulette. And Turmel called out the Cons for forcing the provinces to pay the price for so many of their policies.

Parliament In Review: October 17, 2011

Monday, October 17 saw the Cons cut off debate on second reading of their budget bill. Not surprisingly, the day thus focused in large part on the economy - including some noteworthy pushback against the brand the Cons have spent hundreds of millions of public dollars to promote.

The Big Issue

That's right: as the Cons continue to try to wrap themselves in "Canada's Economic Action Plan" branding, the NDP went to work by directly challenging the Cons' claim to have any plan or vision whatsoever. Among the MPs making that point were Megan Leslie, Jasbir Sandhu, Sadia Groghue. But have no fear, Cons, as Wladyslaw Lizon helpfully explained the plan in full as involving...having been re-elected.

Another consistent theme saw the NDP challenge corporate giveaways which weren't attached to results. Hoang Mai and Francois Choquette made the point when it came to general corporate tax rates, while Paul Dewar made a similar point with respect to research and development in particular.

Hoang Mai pointed out the combination of a glaring need for infrastructure investment and the greater efficiency of public works in stimulating demand when compared to corporate tax slashing - a point which looks even stronger in comparing the infrastructure deficit and the glut of money sitting unused in corporate coffers. And in response to another of Mai's questions, Joe Daniel helpfully pointed out that the Cons are putting five times less money into the investment that produces five times as many results.

Meanwhile, Kevin Lamoureux and Leslie agreed on the importance of housing as both a short-term stimulus and an investment in long-term infrastructure. Mathieu Ravignat argued that inequality is reaching crisis proportions. Don Davies offered a few kind words about the budget before pointing out why it ultimately fails to meet the standard we should expect. Scott Brison expressed concern about the spotty nature of any economic recovery while noting that full-time jobs are actually down even in raw numbers since August 2008. John Williamson asserted that we should be trying to make sure that greater tax breaks are dedicated to those who need them least. And Ray Boughen actually conceded a "discrepancy" in his party's insistence on non-refundable tax credits, while promising a look at the problem that we can rest assured will be ignored by his partymates.

Pop Quiz

Guess which MP said this:

Mr. Speaker, last week a reprehensible crime took place here in Ottawa, but we will not have to bring in CSI Ottawa to find the guilty party. Organized labour in this country was bludgeoned by the Conservative government and the Minister of Labour's fingerprints are all over the weapon.

If you figured it out, well done. But I'm guessing not.

In Brief

Nycole Turmel questioned how Stephen Harper can remain oblivious to growing inequality and protest when even Mark Carney is publicly expressing his sympathy. Robert Chisholm pointed out the Cons' woeful record of giving away the farm every time they sign a foreign trade deal, while Terence Young responded to Marc-Andre Morin's question on the softwood lumber sellout by proudly taking credit for a deal which preceded the shutdown of five sawmills in Morin's riding. Mathieu Ravignat criticized the CETA prescription-drug giveaway (only to receive a thorough non-sequitur of an answer from Gerald Keddy). Kirsty Duncan called for a national school meals plan. Pierre Dionne Labelle slammed the Cons choice to repeat the all-too-regular pattern of governments outsourcing to the point where they lack any capacity to evaluate whether anybody is delivering on their contractual commitments. And Charlie Angus reminded the Cons that the Auditor General said that it's Parliament's job to investigate Tony Clement's G8 scandal - despite their efforts to prevent any such thing.

Wednesday Morning Links

Miscellaneous material for your midweek reading.

- The Star skewers the Cons' insistence on pushing ahead with bad budget choices:

As the Star argued during the election, Canada needs progressive economic vision in the form of strategic investments in scientific research and innovation, health care, a national child-care plan and improving the Canada Pension Plan for younger workers and the elderly poor. Measured by these needs, this budget, like its predecessor, is a bust.

Moreover, it remains packed with dubious spending, including an unwarranted $6 billion corporate tax cut and a smattering of other giveaways. And the Conservatives’ profligacy won’t end there. They are on an imprudent course to spend untold billions on F-35 fighter aircraft and prison-building, as other priorities go unmet.

Apart from its fundamentally skewed agenda, the budget is built on an unstable platform of rosy optimism that may not survive the gathering economic storm. Finance Minister Jim Flaherty readily acknowledges that “the global economic recovery remains fragile.” Even so, he says he can eliminate the $32 billion deficit by 2014/15 by trimming spending by 5 per cent. Yet Ottawa’s anticipated revenue growth could be dragged down by a variety of factors: the weak American economy, $100 a barrel oil, Europe’s debt woes, slowing growth in China and India, or Japan’s tsunami fallout. Anything less than an optimal outcome could force Ottawa to cut more deeply than the $4 billion a year it has earmarked to balance the books.

- And Thomas Walkom also notes the problems with Harpernomics:

When Finance Minister Jim Flaherty tabled his budget this week, he used precisely these kinds of calming words.

Sure, we’ll be doing a bit of cutting here and there, he said. But don’t sweat it. We’re only talking about trimming up to $4 billion a year from $80 billion worth of direct program spending. That’s just 5 per cent. Chill out.

Yet the reality of his plan is quite different.

First, he’s not planning to cut just $4 billion. He’s planning to cut up to $4 billion every year for four years. As his budget document points out, the cumulative total of these as-yet-unspecified cuts is $11 billion.

But that’s on top of the cuts that the government announced in past budgets but that have not yet kicked in. The cumulative total of these, according to Flaherty’s own figures, is at least $9.7 billion.

Add the two together and you get more than $20 billion in planned cutbacks between now and 2015. That’s not 5 per cent of federal direct program spending. It’s closer to 25 per cent.

Which is radical surgery.

So what gives?

The most obvious explanation is that the government is being dishonest.
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Harper and his finance minister are taking a gamble. Taking a leaf from the Jean Chrétien Liberals, the Conservatives are using the deficit as an excuse to continue dismantling the parts of government they’ve already signalled they don’t like — such as health and safety regulation, veterans’ disability pensions and job training.

This would move Canada in the direction Harper wants it to go. But I suspect the Prime Minister knows his cuts could also threaten jobs and income should the world economy take another turn for the worse.

In that sense, the government’s careful rhetoric is more appropriate than its actions. This is a time for caution. It’s not a time for massive spending cuts, no matter how ideologically attractive the right might find them.

- No, it shouldn't be much of a surprise that the Bush administration saw Stephen Harper's Con government as a useful tool from day one. But it's striking how both the U.S. and the Cons seem to have overestimated the value of the softwood lumber debacle in giving Harper room to sell out Canada's interests further:

“That said, I see a real opportunity for us to advance our agenda with the new government,” Mr. Wilkins wrote. “I recommend early on that we look for an opportunity to give Harper a bilateral success story by resolving an irritant such as the Devil's Lake filter system or entering into good faith negotiations to reach a solution on softwood lumber. Press reports here indicate a growing willingness across Canada to get back to the table. Early success on a bilateral issue will bolster Harper and allow him to take a more pro-American position publicly without as much political risk.”

Less than four months later, Canada and the US reached an agreement on softwood lumber, with the Americans returning 80 per cent of the $5.3 billion in duties it had collected on lumber imports over the years.

However, if the deal was supposed to give the Conservative government an accomplishment to show the public it could stand up for the country and defend Canada’s interests in dealing with the US, it badly backfired.

A large number of softwood lumber industry groups, the BC government and the federal Liberals and NDP strongly opposed the agreement, declaring that the Harper government had in fact sold out to the Americans. The Conservatives retaliated by describing it as the best agreement possible and made the deal a confidence motion.

- Paul Krugman sums up how fiscal policy designed for the benefit of current creditors ends up harming the general public. [Update: And then highlights exactly who stands to gain as a result.]

- Finally, Nik Nanos' advice to the NDP may not be particularly surprising, but it nicely summarizes the message the party will need to develop:

“What’s always risky for a party is when it does things that seem to be inauthentic,” Mr. Nanos said. “Your guys and gals are going, ‘Hey what’s this all about now,’ now that we’re in the opposition people will expect certain things from the New Democrats.”

Mr. Nanos added: “I would say that the best way for the New Democrats to try to consolidate second spot is to deliver what people would expect from New Democrats, which is a socially progressive agenda that’s very compassionate, fighting for the little guy and gal.”

On advantageous choices

There's plenty to quibble with in James Travers' latest. But the most important point seems to be an assumption Travers (rightly) makes about the U.S. which seldom seems to be considered true in Canada:

Living next door to the elephant makes the mouse nervous. Long and sometimes bitter experience — remember P.E.I. potatoes and softwood lumber? — teach that Americans are relentless, as they should be, in pursuing national advantage.

Which would seem to be an entirely reasonable expectation from Canada's governments at all levels as well. But from softwood lumber to fighter jets, the Harper government's pattern in dealing with the U.S. in particular is one of signing stunningly bad deals for the sake of being able to claim to have done something, then forcing Canada to accept the terms and costs. And at all levels, the current discourse tends to assume far too often that governments' interactions with businesses and peers should be based on catering to elite whims rather than looking for possible public advantage.

Of course, there's ample room for debate as to where that advantage may lie. But given the recognition that our trading partners and other actors will rightly look to protect and develop their own interests, it's long past time for us to demand that our governments do the same on our behalf.

On cultures of defeat

It sure was annoying trying to figure out how to enforce the softwood lumber winning streak Canada enjoyed before 2006. Which is why we should be grateful the Cons had the foresight to turn Canada into a perpetual loser.

On raw deals

It may have seemed like the Cons' decision to burn $16 billion on a sole-sourced contract to buy F-35s couldn't get any worse. But one should never underestimate the Cons' ability to negotiate a more damaging deal than any remotely reasonable person could possibly imagine signing, particularly where the U.S. is involved. (Anybody remember their handing $1 billion to U.S. interests who had lobbied for illegal tariffs in exchange for softwood lumber "peace" which lasted approximately .7 nanoseconds?)

And apparently they've fallen into that pattern again with the fighter jet fiasco. Now, Le Devoir reports that they've voluntarily abandoned Canada's normal policy of requiring domestic investment in the amount of a defence contract in order to secure the privilege of overpaying Lockheed Martin for the planes. Which looks to do nothing but ensure that our public money does as little as possible for Canadian citizens - and offers another signal that given the choice between Canada's population and American corporate interests, the Harper Cons will take the latter's side at every opportunity.

On giveaways

Speaking of Canada's international pariah status under the Cons, it's far too predictable that anybody who's worked to be excluded from the international community will end up making serious mistakes in trying to fit in. Which brings us to the Cons' announcement that they're prepared to trade away provincial and municipal freedom of action permanently in exchange for partial access to eleven days' worth of the U.S.' dying stimulus program.

There's been no lack of commentary on the topic already, and most of it has pointed out the similarity of this deal to the one that paid the U.S. a billion dollars to punish Canadian softwood lumber producers. But let's look in a bit more detail at some of the mistakes that were repeated between the two negotiations.

First and most glaringly, there's the Cons' continued pattern of working against allies rather than in their interests. In the case of the softwood lumber dispute, the Cons excluded friendly parties on both sides of the border from negotiations while allowing the U.S. lumber lobby to have constant influence, then spent most of their time after striking the deal trying to force Canadian industry to go along with it. Likewise this time, the Cons seem to have done far more work getting the provinces to sign away their ability to procure locally than figuring out whether there's any benefit in trading that sovereignty away.

Similarly, in both cases the Cons appear to have decided first that some kind of deal absolutely had to be struck, then gone into negotiations seeking only to make whatever concessions were necessary in order to be able to walk out holding a signature from the other side. The result is a photo op based on waving a piece of paper around - and dealing with the consequences of what that piece of paper says later if at all.

Which leads nicely into the final obvious similarity, being that neither agreement actually seems to have resolved anything with any finality. In the case of the softwood lumber agreement, it took less than a year after formal approval of the agreement for the Cons to start looking for ways to concede even more, or even begging for U.S. approval to carry out exactly the measures the U.S. demanded in the first deal.

But this factor may be even worse for the latest set of negotiations. As many of the commentators on Buy American have noted already, the deal would never have been necessary if the U.S. had adhered to the terms of previous agreements, meaning that we're once again simply throwing more and more on the table in hopes that the U.S. will live up to promises that it's actively breaking. And this set of negotiations goes even further in that the Cons are explicitly relying on the outcome only as a "precedent" for future U.S. procurement, rather than even trying to secure wording that might bind more than 11 days worth of purchases.

For those looking for whatever silver lining can be found, it's worth noting that the Cons have miraculously only done this twice on high-profile issues during their time in office, rather than setting up monthly sessions to grant greater and greater concessions to the country Stephen Harper wishes Canada would become. But based on what we know to happen when Harper sits down at the negotiating table, there should be every incentive to remove the Cons from any position to pick up the pace.

Square one

If the Cons weren't having a bad enough week thanks to Cadscam, it just got worse, as the London Court of International Arbitration awarded Canada its first (partial) victory on softwood lumber since the Cons nullified Canada's long string of previous wins. Which, based on the Cons' track record, means that they'll now have to go back to the drawing board to figure out how to give away the successful part of today's ruling.

If they're looking for some advice as to how to go about that, though, the Court apparently had plenty to say about the Cons' poor job of developing the agreement itself:

As they issued their ruling, the three judges who handled the dispute remarked on how poorly worded the softwood deal is.

“The Tribunal has found the provisions of the SLA to be less clear and consistent than one might hope for in a bilateral treaty so long negotiated and so closely scrutinized and debated by the contracting states,” the judges said.

That's right: Deceivin' Stephen and his crew aren't even competent enough to deliberately give away the farm without finding a way to screw it up. Which can only make it all the more clear why it's a bad idea to have the Cons representing Canada's interests abroad - and all the more reason for hope that more reasonable parties will soon be in charge of Canada/U.S. trade issues on both sides of the border.

On poor representatives

The CP reports that the first challenge under the Cons' softwood lumber capitulation is set to go to arbitration. And anybody who thought the Cons had already done all they could to put Canada's industry (and provinces) at the mercy of the U.S. has apparently underestimated the Cons' ability to prevent any uppity Canadian interests from intruding on their sellout:

Washington trade lawyer Elliott Feldman, who has acted for Canadian lumber exporters in previous cases, thinks the industry and the provinces will be short-changed by the (new arbitration) process.

Unlike NAFTA panels, they have no legal standing before the London court and must rely on Ottawa to argue their positions.

"Now it'll be federal lawyers defending provincial programs, about which they know nothing," said Feldman...

"We're as happy as we can be under the circumstances," said Bill Thorton, assistant deputy minister for forests at the Ontario Natural Resources Ministry. "I'll confess that it's not an ideal situation. We would rather be there defending our own programs."

That's right: the Cons set up the deal to make sure that industry and the provinces would have absolutely no ability to defend their own interests. Instead, responsibility for defending Canada's position now lies entirely with the same federal government which not only refused to accept Canada's history of wins in previous litigation, but also excluded its own industry from the original negotiation process to make sure that the deal itself would favour the U.S. side, then threatened and cajoled producers into falling into line with the agreement.

Needless to say, there's little reason to think the Cons care any more about Canada's lumber industry now than they did when they first decided to push CFLI's agreement onto it. Which means that with the Cons at the controls for the arbitration process, Canada may be set to follow up its consistent string of victories under the old agreement with an equally long string of losses under the new one.

The sellout continues

Politics Watch reports that Deceivin' Stephen apparently didn't manage to hand enough over in his initial softwood sellout to appease the U.S., and is now looking to sign an even worse deal in order to avoid the litigation that his previous giveaway was supposed to end:

Almost a year after it was signed, Prime Minister Stephen Harper rose in the House of Commons Monday to defend the softwood lumber agreement with the U.S. after reports on the weekend that Canada may consider making concessions to the U.S...

On Saturday, the Globe and Mail reported Trade Minister David Emerson said opinion in government is divided over whether Ottawa should fight in court a U.S. complaint that some provincial aid programs to the lumber industry are subsidies and the Canadian companies are not paying enough export taxes under the 2006 deal...

Emerson's comments to the Globe outraged NDP leader Jack Layton who asked in question period, "Why do governments continue to make concessions when negotiations are over?"

"We're seeing the United States attacking our provinces for simply trying to manage their natural resources and what does the government do? They start looking at the idea of adding export taxes to this sector and that will cost us more than the tens of thousands of jobs that we've already lost."

Seeing as that the Cons have proven beyond doubt before that they don't much care how their deals affect actual producers within Canada, the result of any negotiation figures to be yet another disaster - particularly with the Cons no less desperate to claim any type of accomplishment (however negative) than they were in signing the initial deal.

But if Canadians realize just how eager the Cons are to concede every point the U.S. thinks to bring up, they don't figure to stand for that type of relationship for long. And hopefully today's attention will force the Cons to back off their latest move to that effect.

History repeating

Good news for Con strategists looking for material to fill out a new election platform: they'll now officially be able to promise to solve the long-running softwood lumber dispute all over again. And if the result is rather less positive for the provinces whose industry support programs will be the subject of the kind of litigation that the Cons' capitulation was supposed to end, not to mention Canadians generally...well, the deal was never about them anyway.

Update: Is it any surprise that the Financial Post is going out of its way to paint the CFLI as a victim in reporting on the latest round of complaints?

Softwood peace in our time

Way to go, Neville Harper!

Bending over for Canada

The CP reports that while the Cons' main softwood lumber capitulation may be over and done with, Canadian negotiators are still looking for ways to give away even more in meetings provided for under the agreement:

Canadian and U.S. government representatives will sit down in Washington next Thursday and Friday for the first meeting of the top binational committee.

The Canadians are likely to hear some grumbling about Quebec and Ontario programs aimed at helping their struggling forest industries. Officials say they're confident they can demonstrate to the Americans the programs don't subsidize lumber exports.

In turn, they want assurances the Americans will keep a promise to accept B.C. government timber pricing reforms aimed at removing the main U.S. complaint that logs from Crown lands are subsidized.

So, to sum up...

The U.S.' primary complaint over softwood lumber all along has been B.C.'s timber pricing system. (Never mind that the complaint was consistently found to be invalid, as the Cons gave away that string of wins last year.)

But under the Cons' capitulation, Canada is required to seek the U.S.' approval before making any changes to its regulatory regime on lumber pricing - including the types of changes that the U.S. was always demanding.

As a result, Canada is going into the negotiations seeking the U.S.' permission to do exactly what the U.S. has been demanding all along - with the implication that Canada may then be forced to make additional concessions in return for that permission.

It remains to be seen just how much more the Cons can give away long after the main deal was done. But it should be glaringly obvious that despite the Cons' assurances, the problems with softwood lumber are far from going away - and that Canada will be feeling the aftereffects of Harper's eager loss of sovereignty for as long as the deal remains in place.