Sunday, February 20, 2011

The New National Stock Exchange

Should the Toronto and London Stock Exchanges merge? Of course they should, since the marketplace is global and other borses (exchanges) are merging in this era of global capitalism. And it fits in well with the Feds argument for one national exchange. The irony is that while business sees this as a favorable idea the right wing politicians don't.


But reaction from CEOs and chief financial officers suggests that executives at many of Canada’s largest public companies do not want politicians to step in. Corporate leaders are optimistic that a merger will benefit both traders, and firms seeking capital. Many executives added that it would be pointless to fight against the forces that are spurring consolidation in the exchange business globally.

Business case

Caldwell insisted there will be a net benefit to Canada in this deal.

Here are some of his arguments in favour of a TSX-LSE merger:

* "The listings, the fundraising, the corporate finance will still be done in Toronto." * If it gives "easier access to Canadian companies, easier access to European and Middle East funding via the London Stock Exchange, that would be a tremendous economic boom." * "The LSE does not have a derivatives platform, that is options, and Montreal does. So they're going to be using the Montreal system and staff to build their products in Europe." * "Quebec may actually get jobs out of this" * "We are going to have a greater selection of investments quite possibly, and greater access to capital."


Once again the nationalist protectionist impulses of the Federal and provincial governments (regardless of the ideology of the party in power) misses the point...

Hudak shares Liberal doubts about value of TMX-LSE merger for Ontario

....capital is global and no matter how you regulate it nationally, or provincially, until those regulations are internationalized then you have failed to address the real nature of the new global capital markets.

David Weild, a former Chairman at Nasdaq, says that might not be the case, as the exchange companies—now publicly traded—don’t adhere to the same principals they did in the past when they were private.

“They used to be quasi public utilities that had to look out for the public good by building better economies, they looked out for the entire ecosystem that included dealers, institutional and retails investors and issuers,” he tells BNN.

“They have taken their eyes off of the plight of the small cap company, which is the one that generates jobs and innovation and regenerates economic growth for the world’s economy.”

The very markets that led to the recession and financial collapse of 2008. Denying these mergers does not address the real issue; how to regulate them.


A number of executives across various sectors said it would be difficult for them to argue that Canada should block any deal, given that they are expanding into other countries themselves.

“We at Canaccord believe that Canada should be open to foreign investment,” said Canaccord chief executive officer Paul Reynolds.

And quite a few business leaders took the argument a step further, saying flat out that Ottawa has no business weighing into this deal. “If the Canadian government subscribes to and practises free trade and open market economics, it should leave it alone,” said Ed Miu, chief financial officer of Eldorado Gold Corp.

“Who cares?” said Bill Holland, chief executive officer of CI Financial Corp., adding that exchanges are now “nothing more than a bunch of servers and a name.

“The bigger the better,” he said. “All you’re trying to do is get the most liquidity at the best prices. Is it something that is vital to Canadian interests? Not at all. It’s a non-issue.”

And this weekends G20 Finance Ministers meeting did nothing to address the need for global regulations, leaving each national capitalist regime to come up with its own policies.

This then is the anarchy of capitalism, best reflected by the unregulated Canadian stock market that allows provinces to regulate their own marketplaces.

Right wing provincial governments
oppose a single national regulator, claiming their constitutional right to have their own regulations and stock markets. Mind you in the case of Alberta and B.C. both Stock Markets have been home to many a ponzi scheme, Bre-X to just mention one.

Scandal in the Alberta Stock Exchange

Pro Sports and Criminal Capitalism the Skalbania Pocklington story


They may have a 'constitutional' right to having provincial Stock Markets but that constitution was written in 1867 when the Canadian borse but was a mote in gods eye. The City of London (the Stock exchange) still dominated the markets in Canada until the great depression.

Initial Corporate Ownership Structures
As the stock market deepened, widely held industrial firms also appeared. The Hudson’s Bay Company generally had no single dominant shareholder, though its Chief Factor often seemed to rule the company and its shares did not trade on exchange. But Canada now had numerous small, widely held mining companies and two widely held giants. Canadian Pacific was widely held from its inception; and by 1900, Bell Canada too was widely held.
However, many large Canadian firms now belonged to pyramidal corporate groups – structures in which a family or closely held apex firm controls other listed firms, each of which control yet other listed firms, and do on. The first such group, that of the Cox family, established in 1899, served as a model.
Still, Canadian pyramidal groups were usually not terribly complicated, at least relative to their modern descendents. Most had only a few tiers and a handful of firms. The economic motivations of their builders are also fairly straightforward.
Prior to the big push period, and early into it, old money families and railroad tycoons diversified their wealth by venturing into different industries. As the stock market developed, and public
shareholders became a significant source of capital, selling minority interests in these ventures to small investors became increasingly common. Listing its controlled subsidiaries lets a wealthy family leverage their retained earnings into control over much larger pools of capital than their own wealth, yet retain
complete control. It also let them diversify more extensively while operating on a larger scale in each industry. Thus, began the first corporate groups.
Larger corporate groups were often the result of takeover waves. From 1909 until 1912, when the economy abruptly slowed, 275 of Canada’s largest firms coalesced into 58 in half a billion dollars worth of M&A transactions. The most active corporate acquisitor of this period was Max Aitken, who assembled Canada’s largest pyramidal group. The son of a Presbyterian minister, he rose through the
ranks of Royal Securities, ultimately running the firm for its controlling shareholder, John Stairs, heir to the old Nova Scotia merchant family. In 1906, he used his earnings to buy Montréal Trust, and then used that firm to take over Royal Securities. Aitken issued debt in London on a huge scale and used the
proceeds to buy steel mills, cement companies, power companies, and other firms all over Canada. In this way, he built the Steel Company of Canada from Montréal Rolling Mills, Hamilton Steel and Iron, Canada Screw, Canada Bolt and many other smaller firms. Aitken also formed Canada Cement out of twelve of the country’s thirteen Portland cement makers. At the end of the big push years, Aitken, always a passionate imperialist, bought the title Lord Beaverbrook and retired to London.

More Corporate Welfare

Big Business is never satisfied, it wants tax breaks and tax credits.....either way you and I pay.....So much for being job creators....the only way they can create jobs is not with their own money but yours and mine.....which shows that contrary to the rhetorical litany of the right wing government actually does create jobs.....

Auto executives also called on the federal and Ontario governments to continue offering manufacturing incentives in light of the impact the soaring loonie is having on their industry’s competitiveness.
Since auto workers are taxpayers, and they and we have bailed out big auto with tax breaks, investments, bail outs, pension forgiveness, and pension give backs, as well as wage concession by unions then frankly we own Big Auto we should simply take over the industry and put it under workers control. Especially now that it is profitable again......thanks to you and me and the autoworkers.....

UPDATE 1-Ford, Chrysler Canada sales rise in January

SEE

Big Auto Crisis is the Crisis of Capitalism

There Is An Alternative To Capitalism

Auto Solution II



Saturday, February 19, 2011

Hewers of Wood, Drawersof Oil

This headline once again reveals the untainted truth; China is a capitalist nation and as a world power of capital is Imperialist.

PetroChina, Encana and the eventual export of B.C. natural gas

Regardless of the ideology proclaimed by the state, the fact is that China is a capitalist economy; even if it is a state capitalist one.

As Herr Dr.Marx points out it's about the relationships we have to the means of production, who controls it and who doesn't. In other words once you have industrial production and capital in perpetual production by a working class, capitalist society exists, regardless of its political superstructure. The transformation of peasants into an urban proletariat is the key function of capitalist means of production. And China fits that description as much as England did in the late 18th Century or America in the late 19th Century.


The irony in the relationship between Canada and China is that they are both state capitalist economies. One is more bourgeois democratic, the other is based on an authoritarian command economy. However the state, is crucial in both political economies in determining national interests.

In the case of Canada we are once again being the hewers of wood and drawers of water, a resource based export economy to developing industrial economies. Today we are hewers of wood and drawers of oil.

Is China Western Canada's new best friend?

``Between 2000 and 2010, Canadian exports to China have increased by 3,300 per cent. In fact, Canada surpassed Russia this year as the biggest exporter of softwood lumber to China.''

BC wood-culture push brings Chinese success


This is reminiscent of the original colonial model of Canada vis a vis France and Britain, and then our relationship with America. Now we deal with a modernizing industrial China, as their new resource base as we sell off our manufacturing to other global capitalists.

French Canada was initially a colony of resource extraction, not a colony of settlement. During brief periods when settlement became paramount, Canada was a theocratic society, reminiscent of modern Iran. And when settlement and development was finally pushed determinedly, Canada became a laboratory in
which Jean Baptiste Colbert, the father of French mercantilist economics, tested his theories with development schemes similar to Third World misadventures in the 1960s.


The irony is that the current Federal government in Canada is politically opposed to China, yet they espouse the virtues of free trade, going so far as to call themselves libertarians on this matter. But the fact is that the Harpocrites right wing ideology belies the political economic reality which is Canada, it has always been a state capitalist nation.

However the nature of Canadian political economy belies any true tradition of free trade. It evolved from mercantilism to state capitalism, without the problematic tendencies of free trade.

The first share capital corporations were the North West Company of Fur Traders, and the Hudson Bay Company, fur trading companies that still were mercantile, not really free enterprise. They relied on being monopolies. In fact all of the early capitalist development in Canada was monopoly mercantilism run by a few families. Whether it was fur trading or canal building.

Henry Hudson’s 1610 claim for Britain to the lands around Hudson’s Bay lay unexploited until 1670, when Charles II granted his cousin, Prince Rupert, a fur trade monopoly and rechristened the region Rupertsland. Rupert organized The Company of Adventurers of England trading into Hudsons Bay (a.k.a.
The Hudson’s Bay Company, or ‘the Bay’), a joint stock company, to raise funds.10 The forts, trading posts, and ships required - as well as the risks inherent in the fur trade - were beyond the resources of even the wealthiest individual families. Thus, the Hudson’s Bay Company, like the British East India Company and the Dutch East Indies Company, was among the first joint stock companies formed.

In 1779, British and Loyalist merchants in Montréal established the
Northwest Company to compete with the Hudson’s Bay Company for the fur trade, contesting the legitimacy of the latter’s monopoly. The original founders of the Northwest Company included Simon McTavish, Todd and McGill, Charles Grant, Benjamin and Joseph Frobisher, the firm of McGill and Patterson and five other merchants and firms.15 The resulting wealth gave the same names prominence in
banking, shipping, and railroad promotion decades later. Since the Hudson’s Bay Company had its own militia, the Northwest Company needed one too.
Their battle for market share is best described in military terms.

During this period, the most entrepreneurial regions of British North America were the Maritime Colonies – Nova Scotia and New Brunswick. Abraham Cunard, a master carpenter, arrived in Halifax in 1783 and rapidly established stores, mills, lumbering, sawmills, shipbuilding, an accounting firm, and other businesses. Despite strong competition from other “timber barons” like Gilmour, Rankin, & Co.,
Philemon Wright & Sons, William Price, and John Egan, A. Cunard & Son prospered. Many timber barons, including Christopher Scott, John and Charles Wood, and the Cunards, expanded into shipbuilding and shipping. Bliss (1986, p. 135) remarks that all of these fortunes were technically founded on theft, for the timber was almost all harvested from Crown land. The Cunard Line prospered,
especially after it obtained a monopoly on delivering the Royal Mail between Britain and the Americas.

The biggest enterprises in Upper Canada in the early 19th century were canals. The government built the Rideau Canal from the Ottawa River to Lake Ontario. William Hamilton Merritt organized the Welland Canal, linking Lake Erie and Lake Ontario, as a joint stock company controlled by the Family Compact. After providing generous state subsidies and loans, the Upper Canada government finally
bought out the owners of the failing venture in 1841. The newspaperman William Lyon Mackenzie charged that the whole project was a scam to enrich the Family Compact. Upper Canada’s public finances never recovered.


The creation of both the CPR and CN rail companies was facilitated by the Canadian State, including early on in the last century when immigration was promoted to help develop Rail lands.

Economic expansion paralleled an immigration boom. Under Laurier, Canada’s population rose 44%. Western Canada was rapidly populated along the proliferating transcontinental CPR system. All sectors of the economy grew rapidly and simultaneously to accommodate this infrastructure investment,
and the millions of new consumers flooding in. The situation thus closely resembles what Murphy et al. (1989) call a big push – rapid development sustained by the simultaneous expansion of many interdependent sectors, so demand for intermediate and final goods grows apace with their supply.
The railway, and the immigrant settler farms springing up around it created an economic low pressure zone. Every sort of new business was needed to supply the railroad, the settlers, and all the othernew businesses opening to serve them.


Canada's corporate structure was always mercantile state capitalism. In fact the origin of the Canadian State coincides with the development of the Railways.
The colony’s political leaders felt hamstrung by their inability to subsidize such new ventures. Francis Hincks, an entrepreneur and Member of Parliament, partially solved this problem with a new Municipalities Act, which let towns float debt. A more complete solution appeared in 1849, when Canada began guaranteeing railroad debt, but only if prominent politicians, such as Hincks and Galt, were
on the board to “guarantee good management.” After a brief financial crisis in 1849, a boom and bust in railroad stocks ensued, and railroad construction resumed on a grand scale. Although railroads built honest fortunes, like that of the engineer Casimir Gzoski, corruption was endemic. Sir Allan Napier
MacNab, president of the Great Western Railway, served Canada as chair of the Parliamentary Standing Committee of Railways and Telegraphs. The grandest project, the Grand Truck Railroad, run by Prime Minister Hincks, was ineptly built and almost unusable. A British lobbyist hired by Hincks to lobby
members of parliament wrote:I do not think there is much to be said for Canadians over Turks when contracts, places, free tickets on railways, or even cash was in question.
A Barings investigation exposed rampant fraud, kickbacks, and deceit; and Barings blocked further Canadian listings in London to obtain a veto over additional debt financing and guarantees in 1851. This merely tested the ingenuity of the colonial political elite in circumventing such checks. Railway subsidies became a top government priority. According to Naylor (1975), railroad construction and
financing in colonial Canada were “appalling even by the standards of the day.” Virtually every important politician now moonlighted as a railway officer or director, and railway subsidies both enriched political insiders and drained government coffers. Current, past, and future Prime Ministers Francis
Hincks, Alexander T. Galt, and John A. MacDonald, respectively, and most of their cabinet ministers all had railway financial ties. In 1858, Alexander Galt, now Finance Minister, subordinated Canada’s sovereign debt to railroad common stock and raised the tariff to obtain funds for larger railway subsidies. By the 1860s, Canada had both a shoddily built, poorly run railroad system and a near bankrupt
government.
Now, only union with the solvent Maritime colonies of Nova Scotia and New Brunswick promised fiscal rescue. When the United States abrogated the Reciprocity Treaty in 1866, Galt lowered the tariff slightly on manufactured goods to match those of the Nova Scotia and New Brunswick colonies,
in preparation for their union with Canada. In 1867, British investors blocked New Brunswick and Nova Scotia financing in London to force such a union. The resulting confederation was the Dominion of Canada, a self-governing entity within the British Empire. Canadian independence is usually dated to 1867, though Responsible Government came earlier and Canada remained within the Empire long after. Since the Canadian parliament assumed almost all of the powers of the parliament in London in 1867, this date is probably more appropriate than any other.

When it comes to politics those who complain that China is a one party state overlook the fact that Alberta is a One Party State as well. The longest running one party state in North America! And of course Alberta as a resource based economy, is looking to China to sell to.

Alta.'s economic future lies in Far East

Asia’s state-owned companies have taken significant positions in Alberta’s resources over the past year-and-a-half. Encana, the second-largest natural gas company in North America, announced a $5.4-billion joint venture deal with PetroChina Co. Ltd. last Wednesday, adding to its Canadian projects. Sinopec Corp., Korea National Oil Corp., and Thailand’s PTT Exploration and Production Public Co. Ltd. all made recent investments in Alberta. China Investment Corp. also struck a deal last year.
Like Albertans the Chinese people believe they have a peoples government. Like those on the right who mythologize Alberta's history as a perpetual enclave of right wing individualism, those in China believe that their way of life is good and it is thanks to the government. Even if like in Alberta, it is a minority that elects the government.


ZACHARY KARABELL: Right now, the Chinese government is a good government in that it's providing more affluence to more people in a way that, from anything you can glean, many people in that particular society find minimally acceptable. But I don't know if we would say that's good governance.


IAN BREMMER:You don't get to vote in China. Yet many of them seem reasonably happy with the government they have had for the last 30, 40-plus years. We're going to have to address that.

One interesting point that I want to throw out. I was with Tony Blair a few months ago. He was talking about the fact that we needed to step up and really show our leadership in the G20 and all the rest. My response was, as I raised at the beginning of this question, "The Chinese are much happier with their government today than a lot of us sitting around the table are with our own. How do you address that? How do you respond to that?"

Tony Blair said, "When you look around the world, you see that people want democracy. It's a very tough question, but ultimately, the Chinese will come around; when they get richer, they're going to understand that we have the right system."
Yep just like Alberta, we might eventually have a real democracy here to.


Without an industrial policy in Canada, we will continue to be hewers of wood, and drawers of water and oil. And despite the hang wringing from the right wing about human rights in China, capitalism has no such qualms about making deals, after all the only thing that matters is the bottom line. Without developing secondary and tertiary industries and new industries, we will remain a resource economy with all the flaws that brings.




SEE:
The New Imperial Age
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Friday, February 18, 2011

Flathead Lake Monster



It seems BC conservationists have run into a less than reluctant if not outright hostile BC government when it comes to saving Flathead Lake, part of the Waterton National Park system, from resource development. So in a variation on P3 funding, they have put up their own money to save the valley.....

Conservation groups put up $9.4-million to save Flathead Valley

Cryptozoologists should be concerned as well since Flathead Lake is home to Ogopogo's cousin the Flathead Lake Monster. And even if it is an ancient fossil fish, they too are endangered. Except in Wisconsin apparently

Slow start: Sturgeon spearing season on Lake Winnebago

Thursday, February 17, 2011

RRSP Season No One Buying



Average Canadian family debt hits $100000

The report, released by the Vanier Institute of the Family on Thursday, suggests the debt-to-income ratio is a record 150 per cent.

Leads to this:

Banks are finding us RRSP-fatigued



America The Great Satan

Says Canadian Teen Idol Justin Bieber..... pop culture mullah....waiting for Fox News to comment.....

In the interview, Bieber also weighs in on the U.S. health care system.

"You guys are evil," he says. "Canada's the best country in the world. We go to the doctor and we don't need to worry about paying him, but here, your whole life, you're broke because of medical bills. My bodyguard's baby was premature, and now he has to pay for it. In Canada, if your baby's premature, he stays in the hospital as long as he needs to, and then you go home."

http://content.usatoday.com/communities/entertainment/post/2011/02/justin-bieber-shares-his-views-on-abortion-sex-healthcare/1

Yep socialized medicine works......single payer, government delivered, doctors on salary.

Old News

When I saw this on CBC news on Monday:

Dangerous bacteria found on mall food trays

I had a moment of Deja vu....

and well it turns out that in their effort to go green, the CBC is recycling old news in new bottles.....


Wed Mar 10, 2010

Which Has More Germs - A Restaurant Tray or a Park Sandbox ...

September 15, 2009

Back to School: Toilet Seats are Cleaner Than Cafeteria Trays!

Schools can be a hotbed of bacteria 10/03/06 | abc7chicago.com

October 5, 2005

Where Germs Lurk in Grade School

September 16, 2005

Millions of Germs and Bacteria Await Kids at School : Food Poison ...

* A cafeteria tray had more than ten times as many germs as a toilet seat (33,800 bacterial cells per square inch vs. 3,200 bacterial cells per square inch).
Call it germophobia news created by pandemic media outbreaks. But thanks to all that pandemic panic a simple solution to cleaning a tray, is to grab one of those ubiquitous ever present disinfectant wipes and give the tray a good wiping. And then do it again with a second cloth.

Mind you this is scary....

"We saw as many bacteria on some food trays as we saw on a toilet," said Hancock.

Swabs were taken from a gas station toilet for comparison and lab technicians did find similar types and amounts of pathogens.


Yep gas station bathrooms are notorious for being dirty.....say no more.....good thing they have those disinfectant dispensers in them too now...whenever we read or hear stories like this....disinfectant manufacturers are laughing all the way to the bank......

Odaesque


Now if she ain't guilty why does she look guilty, wearing her sunglasses during question period...what was that about lying eyes....Meanwhile yesterday Rona Ambrose played blocker during question period, hiding Oda from the cameras.....Guess because Rona is Minister of Women.....a position Oda once held, when a hatchet-woman was needed to cut funds to women's groups that were deemed too liberal by the Harpocrites and as ordered by the PMO. With her new position as Minister of CIDA the PMO decided that the church funded Kairos was too liberal and too activist, so once again their hatchet-woman did the deed and cut Kairos funding...only she could not justify the cuts...so she lied to Parliament about it.
Some speculate Mr. Harper’s protection of Ms. Oda, however characteristic of his government, may be compounded by another factor: The opposition alleges the decision to modify the memo originated in the Prime Minister’s Office.


Or maybe they sunglasses are a surrogate for her need for a smoke while refusing to answer questions from the opposition or reporters......

See

Status of Women

Bev Oda

Tory Cuts

Sunday, February 13, 2011

When will BP be Charged In Workers Deaths

I have been face book posting a number of stories about BP. Since the Supreme Court of the United States not only reconfirmed that Corporations were Persons, which was first recognized in the late 1890's, but extended their rights within the political arena, then as persons, they should face the consequences of their actions.

Which is to be charged with murder since they were criminally negligent when it came to safety.The result 26 deaths over five years. But because they were 'workplace incidents' the resulting deaths of real persons, because they are workers, is not considered equivalent to murder.

“It’s an unfortunate fact that monetary penalties just aren’t enough. We believe that nothing focuses the mind like the threat of doing time in prison, which is why we need criminal penalties for employers who are determined to gamble with their workers’ lives and consider it merely a cost of doing business when a worker dies on the job.”

- Dr. David Michaels, Assistant Secretary of Labor (OSHA)




The facts as shown in this Fortune article say otherwise, this was no accident it was an accident waiting to happen.

In the decade before the Deepwater Horizon, BP (BP) had a history of serious accidents. Each time its CEO vowed to avoid a future disaster. In 2000, after a string of fires and equipment failures, CEO John Browne announced plans to "renew our commitment to safety." In 2005, after a horrific explosion killed 15 people at BP's Texas City refinery, he swore there'd be "no stone left unturned" to investigate what happened and correct any safety issues. In 2007, after being named Browne's successor in the aftermath of more problems, Tony Hayward promised to focus "like a laser" on safety -- only to oversee the worst oil spill in history.

Fortune's investigation shows how Hayward, a fast-rising geologist once known as "Teflon Tony," fell tragically short of his goal. Despite efforts to change, BP never corrected the underlying weakness in its safety approach, which allowed earlier calamities, such as the Texas City refinery explosion. Perhaps the most crucial culprit: an emphasis on personal safety (such as reducing slips and falls) rather than process safety (avoiding a deadly explosion). That might seem like a semantic distinction at first glance, but it had profound consequences.

Consider this: BP had strict guidelines barring employees from carrying a cup of coffee without a lid -- but no standard procedure for how to conduct a "negative-pressure test," a critical last step in avoiding a well blowout. If done properly, that test might have saved the Deepwater Horizon.

Indeed, BP executives warned of serious process-safety "gaps" in the Gulf of Mexico, Fortune has learned, in a never-before-reported strategy document dated December 2008. "It's become apparent," the BP document stated, "that process-safety major hazards and risks are not fully understood by engineering or line operating personnel. Insufficient awareness is leading to missed signals that precede incidents and response after incidents, both of which increases the potential for and severity of process-safety related incidents." The document called for stronger "major hazard awareness."

But BP failed. "They just did safety wrong," says Nancy Leveson, an industrial safety expert at MIT who served on a panel that investigated BP's safety practices after its refinery explosion; she has since taught safety classes to BP executives and also advised the presidential panel that investigated the Deepwater Horizon disaster. "They were producing a lot of standards," she says, "but many were not very good, and many were irrelevant." Leveson says that she was so troubled by BP's approach that in January 2010 she told colleagues, "They are an accident waiting to happen."

Sunday, February 06, 2011

Canada Funds Private Armies in Afghanistan

Well once again it takes an American study to tell Canadians what the Harpocrites don't want us to know about their War in Afghanistan.

Canada spent more than $41 million on hired guns in Afghanistan over four years, much of it going to security companies slammed by the U.S. Senate for having warlords on the payroll.

Both the Defence and Foreign Affairs departments have employed 11 security contractors in Kabul and Kandahar since 2006, but have kept quiet about the details.

Now documents tabled in Parliament at the request of the New Democrats provide the first comprehensive picture of the use of private contractors, which have been accused of adding to the chaos in Afghanistan.

The records show Foreign Affairs paid nearly $8 million to ArmorGroup Securities Ltd., recently cited in a U.S. Senate investigation as relying on Afghan warlords who in 2007 were engaged in "murder, kidnapping, bribery and anti-Coalition activities."

Canadian Business Not Productive

Despite the tax cuts given to corporations by both the Liberals and Conservative governments, it has not translated into increased productivity, that is both technological innovation and job growth. So the Harpocrites latest national tour promoting Job Creation Through Corporate Tax Cuts, is all a dog and pony show, the facts don't meet the rhetoric. For five years tax cuts have not resulted in increased RD investment by corporations nor investment in technology upgrades, and of course few new jobs.

But hey if you don't believe me how about these guys:

Canada has made major public investments in research, primarily through universities, but private-sector innovation has remained relatively weak. The OECD ranks Canada as 16th in business spending on R&D as a share of the economy, despite having the second-highest level of government support for such investment. The overall policy and economic environment has become much more encouraging over the past decade. The marginal tax rate on new business investment has dropped sharply, making Canada more attractive internationally and opening a significant tax advantage over the United States.

Thomas d’Aquino and David Stewart-Patterson are the former chief executive and president and executive vice-president of the Canadian Council of Chief Executives and co-authors of the book Northern Edge: How Canadians Can Triumph in the Global Economy. Read more: http://opinion.financialpost.com/2011/01/25/unleashing-innovation/#ixzz1DCwwrEmV


And of course Bank of Canada boss Mark Carney regularly reminds us that corporate failure to invest results in lack of productivity. So why give them tax cuts, clearly it doesn't increase productivity or create jobs.

In fact continued tax breaks federally and provincially to Big Oil has had a negative impact on jobs in Canada.

A 2009 Industry Canada report found that 54 per cent of Canada's loss of hundreds of thousands of manufacturing jobs since 2002 is due to the oil sands boom replacing good, stable employment with short-term construction work in the tar sands and low-wage service sector jobs elsewhere in the economy. Canada has lost one-third of its post-war gains in value-added (manufactured) exports since 1999/2000, Canadian Auto Workers senior economist Jim Stanford told the Institute for Competiveness and Productivity in 2008.

The problem is not worker productivity, since workers in Canada are highly productive, its investment in actual technology.

The Canadian manufacturing sector employed more than 2.3 million people in 2002. By last September, manufacturers had shed some 580,000 jobs - more than one in four – and most of these losses occurred before the recession. There are few signs that this trend will reverse itself soon.

the fall in manufacturing employment was largely due to attrition, not layoffs. And one of the surprises of the recession is that manufacturing unemployment is now lower than it was before the recession – although this result was largely achieved by workers leaving the sector altogether.

But it’s a puzzle nonetheless: output per worker in the manufacturing sector has been increasing more than three times as fast as the economy as a whole. If productivity growth is the key to sustained prosperity, then shouldn’t manufacturing be increasing in importance?


Tax cuts have not created jobs, since corporations have used the break to accumulate capital which if invested at all is invested in the stock market and in mergers and acquisitions, not in workers wages, technology or pensions.

Corporations in this country are flush with cash and ready to grow.

"In some ways, corporate Canada has never been stronger than it is right now," Tal said.

"Better-than-expected profitability and a reluctance to spend in recent years has left Canadian businesses sitting on a record amount of cash and confident about the future.”

Swift and strategic downsizing during the recent recession paid off, Tal said. It allowed companies to withstand the downturn and ramp up hiring at a much faster clip than in the U.S.


In fact both private corporations and ironically our public pension fund the CPP have led the way in taking that capital and investing it abroad.

Foreign investment is a two-way street.

The Canada Pension Plan Investment Board and Onex took top honours for the biggest global private equity acquisition of the year with their $4.4-billion purchase of U.K. manufacturing giant Tomkins.

PricewaterhouseCoopers suspects Canadian companies will continue look past North America to emerging markets for better deals.

Last year, Canadians made major “buys” in nearly every continent with deals in the fourth quarter alone stretching to the Middle East, Asia and Africa.

“These transformational deals are beacons for what will become the norm for Canadian deal making going forward,” Knibutat said.

Joint ventures and minority purchases will also become more popular, it said. These deals allow companies to test drive sectors while minimizing financial and political risk, PricewaterhouseCoopers said.

“Organic growth prospects within North America remain limited, so for many well capitalized corporates and funds, M&A may be the best and only tool for growth,” Knibutat said.

A “perfect storm” of companies flush with cash, improved access to financing and lacklustre organic growth prospects means the M&A outlook is even brighter for Canada in 2011.

Global public companies have an estimated $3 trillion in cash reserves. Private equity firms hold another $500 billion.

Competitive tensions stemming from strong takeover demands are likely to entice sellers back in the market and that should create a more balanced number of buyers and sellers, PricewaterhouseCoopers said.

All this means Canada will likely continue to outpace the globe when it comes to M&A activity, buoyed by a well-capitalized financial system, strong dollar and leadership in hot deal sectors.

So rather than calling corporate tax cuts job creators, we should call a spade a spade; all that tax cuts do is reduce government revenue, social capital, while giving corporations more capital. Tax cuts are public funding of private profits, without having shareholder benefits. Tax cuts are corporate welfare.

A broad look at how corporate tax rates have changed Canada in the past suggests the impact of the small cuts planned for this year and next is marginal for most companies.

The larger impact is on the government's bottom line, not the corporate bottom line — even though corporate taxes have now become key in determining whether there will be a spring election.

Indeed, federal Finance Department documents show that the reduction of corporate income tax — from 18 per cent in 2010 to 16.5 per cent in 2011 and then to 15 per cent in 2012 — will be expensive for any government battling a deficit. The cost is about $1.6 billion in foregone revenue in the 2011-2012 fiscal year, $3.9 billion the year after, and a total of more than $10 billion over three years.



Quit Your Tweeting Over UBB Challenge the Teleco Monopolies

While thousands of Canadians blogged, tweeted and set up internet petitions about the CRTC's User Based Billing (UBB) decision this week, methinks they protest too much, or at least have missed the real issue. As Michael Geist points out; The widespread use of bandwidth caps in Canada is a function of a highly concentrated market where a handful of ISPs control so much of the market.

The fact is that the Canadian marketplace is dominated by oligopolies; the big Telco's and Cable operators. They already overcharge us for cell phone use as well as internet access. You are already getting gouged even before the CRTC ruling!

Canada’s largest telecoms don’t want to say how much it costs to deliver a gigabyte of bandwidth and have refused to disclose such data, arguing that information is both proprietary and competitively sensitive. They also argue that it’s difficult to calculate the specific cost of delivering bandwidth since the cost varies based on the technology being used, the user’s location and the time of day.


Of course they don't because as studies have shown we are charged more for our use of these "public utilities" then any other countries. And the reason is that these oligopolies make a profit off of service charges.

It’s 2010 and Canadians pay the highest cell phone bills in the world

Surveying more that 50 developed and developing countries where information is available, one country comes out on top when it comes to the most revenue extracted per subscriber on a monthly basis. And that country is of course Canada. What you are looking at here are the world rankings of mobile ARPU (Average Revenue per User). To you and me ARPU is your monthly bill, before GST/PST/HST etc. (through taxes and high spectrum license fees, our government is culprit here too)

This data is total bill including both voice and data. Canada does not have the highest proportion of data to voice charges though data usage in Canada is growing fast (we’re finally catching up after a late roll-out of 3G compared to many countries). Interestingly, Canadians are estimate to pay slightly less per minute of voice (10 cents vs 11 cents) on average than our nearest neightbour the U.S.. What is really driving bills in Canada over the top are the egregious fees like system access fees (the fees many plans still pay whether you access the system or not in a month), and especially “value pack” fees like 15$ a month for the luxury of call display and handful of voice mails



Now remember when they say that they have legacy costs, those costs are transmission lines, satellite connections, etc. Things that we the taxpayers have invested in. Telus was originally a government of Alberta phone company and it bought our city owned telco; Edmonton Telephones. So its legacy costs are the direct result of being a public utility. The Canadian government satellite program is used by telecos to transmit GPS signals, as well as broadband and mobile phone transmissions. So how come we get charged as if these companies had actually spent some money on this infrastructure.



Instead of protesting over UBB folks should be pissed off that the telecos and cable companies are gouging us using our public airwaves, and our legacy infrastructure and then charging us for it. The right wing likes to talk about how competiton will decrease prices, but that is not the case when the market is dominated by oligopolies who set base prices. While some would say its time for the CRTC to go, I would contend that since there is little interest in nationalization of these public utilities, that we direct the CRTC to set real rates based on the global market prices. Our protests should be over the costs we are charged not for usage but for service fees. Service fees should be eliminated, just as ATM and Bank charges should be.



No Cops No Violence Egyptian Self Organization

When you line up rows and rows of riot cops, they have to have something to do. So when you have cops at demonstrations you inevitably have violence. Whether it was the recent G8 G20 meetings in Toronto or last Fridays rally in Liberation Square in Egypt, riot cops present attacked the protesters.

But once the Egyptian security forces were routed and forced off the streets of Cairo, and these are not merely riot cops, they are Gestapo like security forces, rather than violence and chaos, contrary to the media headlines, something new occurred. The demonstrations were peaceful, self organized.

A carnival atmosphere was reported until last Wednesday when these same cops, plus the criminals they let out of prison to intimidate the Egyptian masses, led pro government attacks on the demonstrators. By Friday the carnival atmosphere in Liberation square returned.

People are engaging in Potlach and Potluck, bringing food, drinks, blankets, medical supplies to share with their neighbours in Liberation square.In Liberation square the people have set up hospitals, latrines, and they clean up after themselves.

When the police left the neighbourhoods open to the criminals and thugs they released from prison, Egyptians organized neighbourhood self defense committees. The media call these vigilantes, but they are not, they are classic forms of anarchist self organization. Neighbours old, young, men, women, Christian, Muslim, have met each other and helped each other.

This is Anarchy in its truest form. The people organizing themselves, without the need of leaders. And there is no violence, the only violence comes from the State, trying desperately to hold on to power. The state needs chaos, it thrives on it, in order to justify the need for police.

But without the State or the police the people organize themselves for themselves.Just as the revolutionary proletariat in Spain did in the Thirties and the Russian people did in 1917.

If CNN and the internet had existed in 1917 the early days of the Russian Revolution or in Spain in 1936 the beginning of those revolutions would have looked like Cairo.

The New Proletariat and the Coming Revolution

While students protested government increases in tuition and cuts to Education in Britain, the youth revolt has spread to the Middle East. The proletariat is no longer just blue collar, white collar or pink collar workers, it includes the mass of unemployed and underemployed educated youth who have embraced the calls to freedom to lead the seismic shift that is occurring around the world and in Egypt and the Middle East in Particular.

"In most Arab countries, a majority of the population is under 30, and unemployment rates are exceptionally high for young workers, who are the most likely to rebel," economist Chris Lafakis of Moody's Analytics said in a report today, as masses gathered in Cairo's Liberation Square and Jordan's King Abdullah sacked the government amid mounting street protests. "In Egypt and Saudi Arabia, almost 90 per cent of unemployed workers are under 30," Mr. Lafakis said. "As evidence of the risk of revolution contagion, Syria's president has already signaled that he will push for more political reforms. The events in Egypt could also spark unrest in Sudan, a politically unstable country where demonstrations are already occurring and citizens have voted to partition the country."


I have been saying for years on this blog that two groups not often considered part of the classic definition of the proletariat, but in fact are, are women and youth.

Now we see with the revolt in Tunisia and now Egypt that unemployment and rising food prices have brought out both women and youth to demonstrate against the dictators who run their countries. In Europe and North America young people face democratic governments but the same crisis of capitalism, where the governments are now demanding austerity measures, cuts to public services, to pay for bailing out the capitalist corporations and banks.

'From sacking lollipop ladies and closing youth clubs to axing college grants and trebling tuition fees, this is a government at war with our young people and therefore at war with our future. It is betraying an entire generation,' said general secretary of the (British) University and College Union, Sally Hunt.

In Canada the youth unemployment rate is double the national average, and it is increasing not decreasing. The annual unemployment rate for youth in Canada is 14%.

And while more women are in the workforce than ever before they are older, not younger women.

Employment among women aged 25 and over increased in January (+55,000), with gains for both the 25 to 54 and 55 and over age groups.Over the past 12 months, however, employment growth for women was concentrated among those aged 55 and over.

In the U.S. it is even higher and adds to further high unemployment stats amongst blacks and Hispanics.

Youth unemployment rates in all categories is an average of 18% in the United States, approaching Egyptian and Tunisian levels, but joblessness among young African-Americans and Hispanics are among the highest in the world. This poses a future political problem for the world’s richest nation.The US Department of Labor report in December 2010 broke out unemployment and participation rates into three categories: White unemployment is 8.5%, or below the national average of 9%; African-American is 15.8% and Hispanic at 13%.

Everyone compared the meltdown of 2008 to the Great Depression, and they were right, however the bail out of the banks and corporations to save capitalism from itself has not resolved the contradiction that this has been again another global jobless recovery. The very soul of the Great Depression was not the collapse of Wall Street but the mass global unemployment crisis of capitalism. That same crisis is with us today despite the bailouts!

Global economic growth is on the rebound but the labor market continues to disappoint with 205 million people unemployed in 2010, according to a UN report. The number is not expected to improve much this year. Labor markets in Europe, Africa and South America are struggling to recover from the crisis that hit them in 2008. Europe's young people under 25 are facing an especially difficult situation. The youth unemployment rate is now at a record level of 21%.

So why have not seen mass protests in North America like those that have occurred in England, Europe and now the Middle East? Because despite mass unemployment, neither the Harper nor Obama governments have brought in austerity programs like the Cameron government has. The austerity measures which have been introduced in Ireland, Greece, Spain, etc. have led to mass protests and have failed to actually resolve the continuing crisis of these Capitalist states.

Once the Harper and Obama governments begin to cut, slash, reduce, freeze, public sector spending then we will see a rage amongst youth that will make the tea party look like well a tea party.

The bail out of capitalism has not solved the crisis of capitalism, it can't. And using the tired old neo-liberal solutions of slashing government spending, which is social capital, will not succeed as the Cameron government has found out.

Furthermore unlike North America, which produces food for export, those importing food are facing a constant inflationary battle. A battle which leads to mass protests.

A recent Economist piece gives insight into the pressures felt:

Outside America, food has a bigger share than energy in consumers’ shopping baskets—and thus in inflation too (see chart). In developing countries, rising food prices can be a human as well as an economic disaster. In Asia in early 2008 a spike in the price of rice led to widespread unrest and desperate attempts by governments to secure more supplies. In December in India, for example, food prices rose at an annual rate of 14%, and there has been a run on onions, a dietary staple. Read more: http://www.businessinsider.com/global-macro-notes-the-deflationists-are-still-in-it-to-win-it-2011-1#ixzz1DCZFkdFo


The crisis is not over, it is spreading, and youth unemployment and rising food prices, are needed for capitalism to function, no different than has been since Marx wrote about it over 150 years ago.



Wednesday, January 26, 2011

Synonyms


One could be forgiven for thinking that Canada Post will now enter the New Age with Quantum Transformational Holistic Postal Delivery under its new CEO Deepak Chopra. But No it turns out the new CEO of Canada Post is not that Deepak Chopra....

Deepak Chopra heads Canada Post -- no, not that Chopra

In Israel the largest government sponsored P3 oil/gas company is called Delek, pardon me if that does not remind me of the Daleks in Dr. Who....Israel’s gas market has soared to the top of the national agenda in recent weeks on the backs of the Sheshinski Committee recommendations and the dramatic findings related to the Leviathan natural gas field – the largest discovered in the last 10 years worldwide.

Now Leviathan is another synonym with several meanings a whale or sea monster in the Old Testament and the overwhelming power of the State according to Hobbes... Which seems totally apt in this case.

Friday, May 28, 2010

Your New IPad

Today Canada and the rest of the world gets to buy Apples IPad...

iPad launches in Canada, around the world

Just remember who made it and why it is so cheap.

Globalization of labour demands a global labour movement.....for those who say unions are out dated......China is a developing capitalist country
in case anyone still thinks it is communist......

They work up to 12 hours a day, six days a week, assembling products that most cannot afford to buy themselves: Apple iPhones, Dell computers and Nokia mobiles.


Experts said deep-rooted problems lie behind the deaths of so many young workers.

Guo Yuhua, a sociology professor at Beijing-based Tsinghua University, said Foxconn represents the status quo of China's profit-driven manufacturing industry, in which companies are trying to offer low salaries to workers to control production costs.

Workers are usually kept in closed industrial parks with no access to social activities and no way to develop social relations, she said.

"This problem is not limited to Foxconn, and it's not only a psychological problem but also a social one," she said.

Guo also said labor-intensive manufacturing companies like Foxconn should make more efforts to enable their employees to have normal social lives.

"There should be communities and the workers should have time to have contact with others," she said.

The monthly salary for a typical Foxconn employee is about 900 yuan ($131), so many workers volunteer to work extra hours to earn more money.

Lu Huilin, an associate professor of sociology at Peking University, said the string of jumps also reflects the poor situation of the second-generation migrant workers.

All the confirmed dead Foxconn workers are between 18 and 24 years old, and most come from the rural and less-developed regions.


Bre-X Redux

The Alberta Government is challenging the Federal government, their fellow Tories, over the proposed National Securities Commission. Like their failed gun registry challenge this is a waste of taxpayers money. The Alberta Sock Market along with its counter part in B.C. were a wild west show of rip offs during the eighties and nineties. While Alberta and Quebec protest a single national securities commission I would remind readers of the success of Alberta's Securities commission in protecting investors from rip offs, one little word; Bre-X.

Cold War Chickens Come Home To Roost

During the cold war the CIA engaged in black ops to destabilize the Caribbean and other areas of Central and Latin America that they determined were their domain under the Monroe Doctrine. Ironically it was exactly these operations that led to the increase in the drug trade, since they were black ops the money used to pay for them was drug money. As it was in their operations in Viet Nam/Laos and Cambodia and later in Afghanistan and Contra Iran affair. And during this same time the American government began its war on drugs, a war that was bound to fail since it was American policy to encourage drug lords to fight the left, a policy begun after WWII in the port of Marseilles.

Here the consequences of the CIA cold war black ops are still being felt in Jamaica and downtown Toronto......


In a move that mirrored similar operations in Panama and other Latin American countries, U.S. intelligence agencies lent support to emerging right-winger Edward Seaga, then-leader of the Jamaican Labour Party. In a 1977 investigative report, Penthouse magazine, citing U.S. intelligence sources, described how the State Department sought to capitalize on the spreading violence between Mr. Coke’s Shower Posse and the garrisoned neighbourhoods that supported Mr. Manley: “Shipments of guns and sophisticated communication equipment begun to be smuggled into the island. In one shipment alone, which was grabbed by Manley’s security forces, there were 500 submachine guns.”

But after Mr. Seaga’s nine-year stint as prime minister in the 1980s, the U.S. justice system decided that their ally’s enforcer in Tivoli Gardens had become too powerful, as Mr. Coke’s violent network of drug dealers and gun runners boiled over onto U.S. soil. After the elder Mr. Coke’s capture and mysterious death in 1992, the funeral procession numbered in the tens of thousands. Marching next to his casket was Mr. Seaga, who told reporters that the dead man had been “a protector” of the people.

It was U.S. foreign policy that gave rise to the system that propped up the late Mr. Coke and his now fugitive son, said Mr. Crawford, the political analyst. “It is one of the supreme ironies of life, as far as Jamaica is concerned,” he said.

Saturday, March 06, 2010

A Monument to Capitalism

As I wrote on face book after the throne speech:"So the Conservative government is going to build a monument to "the victims of communism" gee just to be fair and balanced they should build one to the "victims of Capitalism" too."

And I note that Rick Salutin in yesterdays Globe and Mail said the same thing.
"
One size fits all: My favourite moment in Wednesday's Throne Speech was the promise to erect a monument to the victims of communism. As a monument-liker, that would be fine with me – if it were twinned with a monument to the victims of capitalism, which makes as much sense. Or maybe they could both be united by the need to cut spending, resulting in a single National Victims Monument, come one, come all."

Now I could point out that what the Harpocrites are talking about is Stalinism and its children; Mao and Pol Pot, but for the conservative right wing they go back to the Bolshevik revolution. In fact Jason Kenney the Minister of Immigration has gone as far as defending fascism in Spain because the republicans were socialists, anarchists and communists.

But of course as my regular readers know, the state capitalist regimes in the USSR, China, Cuba etc are not communist nor are they even socialist, they are public ownership under a one party state.

Sort of like Alberta.

And in WWI Alberta was home to concentration camps, called interment camps, for Ukrainians who built Banff and Jasper as forced labourers. During the great Depression internment camps were used for unemployed single men, since there was no welfare or unemployment insurance.

The right wing loves to talk about Stalinism as if it is equivalent to Hitler and the Nazi's. And in fact if push comes to shove, Lenin, Stalin, Mao, Fidel and Pol Pot are equated as one in the same, and worse than Hitler or Mussolini or even Franco.

Since fascism is a right wing movement that grows out of calls for law and order, along with appeals to a corporatist state, a form sometimes mistakenly called National Socialism, coined originally by Oswald Spengler, if you look in the conservative closet you will find a shiny pair of jack boots.

The conservative ruling classes during WWII in both England and the US found much admirable in Mussolini and Hitler, especially their self proclaimed war on Bolshevism. Conservative and right wing politicians lobbied for Hitler, promoted isolationism in the US and appeasement in England.

Our own former PM King favoured Hitler, when he wasn't talking to his deceased mother through his dog. He declared that the volunteers who fought in Spain against Franco were acting illegally. He refused entry into Canada to German Jews. And heck he was a Liberal.




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