Neo-Cons Have No New Ideas

The neo-con federal government of Harper and Flaherty have no new ideas, just the same old ideology. After lambasing Harper for his flip flop on the deficit, and his denial that Canada is in a recession, Don Martin in his column today says;

"Be it campaign deception or denial, having tens of thousands suddenly face the loss of jobs, savings and perhaps their homes has twisted Harper's old beliefs into policy pretzels. For this Conservative government, the age of ideology is over -- technically and realistically."

Unfortunately Don the Conservative Government has not given up on its neo-con ideology as we witness in this announcement by Jim Flaherty.

Flaherty aims to boost economy with P3 projects
Ottawa wants to build billions of dollars of bridges, hospitals and other infrastructure as a way to lessen the blow from the financial crisis, finance minister Jim Flaherty said Monday.
Speaking at a conference in Toronto, Mr. Flaherty said investments in infrastructure will be "a key part" of the government's strategy to stimulate the economy.
But some observers say there's a problem with the plan. The government wants to deliver the projects through so-called public private partnerships (P3) where projects are built and financed by the private sector but according the government's requirements. But while the P3 model has gained acceptance in much of the world, there is rising concern that the credit crunch has made it almost impossible to finance new P3s.
Because of the financial crisis, finding willing lenders has become a lot more difficult and when they can be found the cost of capital for even triple-A borrowers is much higher than even a few months ago, said Alban de La Selle, a senior executive at Dexia Credit Local SA, a leading European bank.
"Lenders [on infrastructure projects] have become significantly more cautious," according to a recent report by PricewaterhouseCoopers. "... infrastructure finance raising is likely to be challenging for some time to come and the business risk of these transactions is certainly higher."
But the financial turmoil may have thrown a monkey wrench into the mechanics of P3s by making the financing so much more difficult.
Mr. de La Selle said one way to overcome the problem would be for the government to provide the financing itself. Since governments are among the few players that can get the benefit of lower borrowing costs, that advantage could be brought into play in doing P3s, he said. For their part, the private sector partners would guarantee to repay the debt.

So instead of the government funding infrastructure projects, the Harpocrites want to fund the private sector to do it for them. Ironically currently P3's in Canada are funded by public pension money, there are very few private P3's.

The Harpocrites had an opportunity to build a P3 project; the National Porttrait Gallery but they canceled it last week.

Earth to Flaherty,hello we are in a recession if not a depression and companies are hoarding capital not spending it. So instead of expanding the public sector the government will be choosing winners and losers in the private sector to build infrastructure. And these companies will promise to repay the debt, which will only happen if they survive this depression. Throwing good money after bad.

And he made his announcement at a conference on P3's sponsored by the right wing business lobby the Fraser Institiute.

So much for the Harpocrites abandoning their neo-con ideology, even in this recession they scramble to keep faith with the right wing ideology that got us in this mess in the first place.

Speaking to a Fraser Institute dinner, the finance minister committed to increased spending by Ottawa, if it is needed. Flaherty stressed at the luncheon the importance of infrastructure spending by the federal government, notably in partnership with the private sector. He announced $1.25 billion in startup funding for P3 Canada Inc., an entity that will work on public-private projects.
Thank goodness for this opportune recession, even if it is still "technical," as Finance Minister Jim Flaherty insisted at a downtown conference yesterday. If it weren't for whatever it is, nothing would get done.
The legacy of good times lasting more than a decade is a mountain of unfunded priorities for public spending. It took recession, or perhaps only the vivid perception of it, to focus government attention on what it should have undertaken years ago.
Focus is too soft a word to describe the sudden conversion of our former fiscal conservatives to counter-cyclical spending. Yesterday, a previously dismissive Mr. Flaherty let the world know he was jumping into the pothole business with both feet.
Infrastructure spending "will be a key component of our future success," he told a conference on public-private partnerships, and a "key component" of his government's planned economic stimulus. Although ideological conservatives may worry about burdening future generations with unsustainable debt, real Conservatives are now committed to spending their way out of recession.
And nobody is cheering louder than the crowd that brought us collateralized debt obligations and credit default swaps. With the market for such innovative products seized up worse than a rusty Ford, government has become the only source of cheap credit for anything. Ergo, everybody loves infrastructure. Well-dressed converts flocked to Mr. Flaherty's speech yesterday like contrite sinners to a revival meeting.
Instead, governments should activate construction projects that are already on the drawing-boards, and have been waiting for funding. Canada's infrastructure suffered much depreciation during the fiscal restraint of the 1990s, and did not catch up in the balanced-budget period. The wear and tear are showing.

SEE:
Your Pension Plan At Work
A Critique of P3's From The Right

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Nova Scotia Imitates Alberta 2

In another example that the old neo-con ideal is not dead yet, Nova Scotia like Alberta is once again looking at P3's as a solution to long term funding of infrastructure. Despite its failure in that province previously. And like Alberta, which has a labour boom while Nova Scotia has a labour deficit, the costs will rise because of scarcity of labour. Those costs will be passed on to taxpayers if not now then over the life of the P3 agreement.

Once hailed as the new vision of the right, privatization, P3's and contracting out have proven to be a billion dollar boon-doogle and not a solution to rising costs. They are in fact simply taxpayers paying private companies to provide services that make them profit, by cutting wages and providing poorer quality, and they end up costing us more in the long run. It looked good on paper, but as with most of these ideas from the seventies they have proven their time has come and gone.

In fact in Canada it is your and my pension funds that paying for these P3's. So we get screwed twice as taxpayers.

Nova Scotia Throne Speech eyes privately funded roads, bridges

The Canadian Press

November 22, 2007 at 1:33 PM EST

HALIFAX — Nova Scotia's Conservative government has opened the fall session of the legislature with a Throne Speech promising a return to public-private partnerships in constructing roads, schools and other facilities.

In a document entitled “Throne Speech for the New Nova Scotia,” the government says it has learned from the mistakes made when a previous Liberal government introduced the P3 concept that built 30 schools in the 1990s.

The government says with a $12.4-billion debt, it has to find ways to reduce the costs of building and maintaining public roadways and buildings.

The speech estimates the province is facing a long-term bill of $8-billion to build and maintain infrastructure.

The document also says a new department will be created that is focused solely on the environment, along with a new Ministry of Labour and Workforce Development to help deal with a shortage of skilled labour.

The government is also promising new education standards with primary attention paid to mathematics and literacy and says it will continue a freeze on university tuition with more reductions planned.

SEE

Nova Scota Imitates Alberta

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Infrastructure Collapse

When your infrastructure was built fifty years ago, and was expected to only last half that time, well this is what happens when you waste a decade fighting the deficit chimera of the nineties.

Tunnel ceiling cracks close Montreal streets

–A large section of downtown Montreal will remain closed for the weekend after two cracks were found in a tunnel that makes up part of the underground city.

Montreal police widened a safety perimeter last night to include a number of blocks in the city's downtown core after officials felt there was a real risk of a road collapse following the discovery of cracks in an underground tunnel.

Fire chief Serge Tremblay told reporters last night that a second fissure was also found, but experts haven't been able to conclude what caused the cracks or how long they had been there.

Bridge to Laval latest to undergo repairs

Since the collapse last year of the Laval overpass, Quebec's Transport Department has been conducting more thorough inspections of the province's infrastructure.

Last week, responding to fears a 69-year-old north-end Montreal overpass could collapse because its concrete has "weakened," the city barred all trucks from the heavily-used structure and announced plans to demolish and rebuild it next year.

This is the empirical result of the neo-conservative political agenda of reducing taxes and regulations,failing to fund infrastructure and public services, and promoting privatization.

Bridges in Canada have reached 49 per cent of their useful life, according to a 2006 Statistics Canada study, and experts warn our country's roads, wastewater plants and other infrastructure isn't in any better shape.

A Statistics Canada study examining the age of infrastructure in Canada cited wastewater treatment facilities as the oldest, with 63 per cent of their useful life behind them in 2003. Roads and highways had reached 59 per cent of their useful life, and sewer systems 52 per cent.

Of course it is not only occurring in Canada, but also in the U.S. which originated the daft ideology of the neo-cons.

Emergency personnel look over a truck that lies in a hole in the street after a steam explosion in midtown Manhattan, New York, Wednesday, July 18, 2007. (AP Photo/Seth Wenig)

Cataclysmic infrastructure collapse: Who pays?
A recent Minneapolis bridge collapse and New York steam pipe explosion, both of which collectively caused the deaths of at least six people and more than US$250 million in damages, has brought infrastructure liability to the fore, according to a report by KPMG.

At issue is whether insurers are on the hook for the cataclysmic failure of a decaying urban infrastructure.

KPMG Insurance Insider quotes Claire Wilkinson, the vice president for global issues at the Insurance Information Institute, on the issue of where liability falls in the event of a massive infrastructure failure.

She notes that, in the United States, federal and local authorities that administer bridges and road can claim "sovereign immunity" to avoid liability. But she adds the common-law defense may no longer apply if the infrastructure was under repair, opening the public entities and contractors to charges of negligence..
"A contractor employed by the state could cause damage where the state would be held liable," KPMG quotes Wilkinson as saying.

And even if a contractor has liability coverage, Wilkinson adds, in a world of multi-million construction projects, the limits would likely be quickly eclipsed. KPMG notes that in the event a state contractor exceeded liability limits, the pubic entity might be held responsible for project liability associated with the costs of reconstruction, casualty, property business interruption and/or workers compensation claims.

And so the result is the idea that P3's will solve the under investing done by Governments at all levels for the past two decades. Except the so called 'private' partner, ain't. It's your and my pension funds. In other words you and I pay twice, as taxpayers then as Pension Fund participants.

The bridge collapse in Minneapolis is giving rise to other concerns. Hundreds of billions is needed to rebuild the nation's infrastructure. It's not just roads and bridges. It's also generation and transmission.

Enter infrastructure investing: Public and private pension funds currently invest in varied assets that range from stocks to bonds to real estate. But some are now taking a look at vital infrastructure as a way to earn better-than-average returns as well as to guarantee the longevity of an area's economic growth. If such allocations could provide competitive returns, pension experts say that fiduciaries and trustees would not violate their obligation to act solely in the interest of plan participants.

See:

Minister of P3

Mr. P3

Super P3

Public Pensions Fund Private Partnerships

Pension Fraud Brings Down Japans Government

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