Literally Worth a Million? That's retarded!

Public transit users in Toronto are surely familiar by now with the subway ads from the Amalgamated Transit Workers Local 113 union. These ads explain how each TTC worker is worth more than a million dollars, concluding with the observation, "That's amazing!" The fuzzy logic is quoted below. [source]

The Special Report by leading environmentalist and former Ontario Cabinet Minister Marilyn Churley calculates that the economic, environmental, health and other benefits of the TTC to Toronto total at least 12 billion dollars. And that’s a conservative estimate. Many benefits of the TTC are literally incalculable, but real.

Since about 11,000 people work for the TTC, that means each contributes, on average, more than a million dollars in benefits every year. Most TTC workers are represented by ATU Local 113, the sponsor of this site. We’re proud of the work our members do, work that deserves public recognition. Each one is literally Worth a Million.

That is some dubious accounting. The TTC may well be worth $12 billion, but it is not the case that members of the Local 113 are giving personal piggy-back rides to each commuter in the city. The average worth of each TTC worker can only be assessed within the context of the TTC system as a whole. One must first assess the value of previous investments in infrastructure, which includes investments in new vehicles and thoroughfares. Beyond this, operation and maintenance costs pay for more than just the labour of transit workers; the material costs associated - like, say, fuel - are significant.

I do not know the exact numbers that need to be added to the balance sheet, but considering that Premier Dalton McGuinty's rapid transit action plan for the Greater Toronto Area is supposed to cost $17.5 billion, one can safely assume that the transit workers' union is playing a shell game with these ads. I am meant to be convinced that these (mostly) low-skilled workers are invaluable assets to the city. Perhaps if there was even a pretense of plausible accounting in this ad campaign, I might have fallen for it. Instead, I am just reminded that the transit workers' union, by virtue of the TTC's monopoly position, can hold the entire city hostage in order to demand ever higher ransoms.

Not even two years have passed since the transit workers' illegal wildcat strike in 2006. Last weekend, with the threat of strike action looming for Monday morning, Torontonians sighed in relief as it appeared that the crisis had been averted as both sides agreed to terms. This evening, however, it all fell apart as workers voted to reject the the tentative agreement. The union had promised the mayor to provide a 48-hour warning, yet at 10:30 PM on a Friday night, they announced a strike effective midnight that same evening! No doubt, many city dwellers and suburbanites emerged from the bars this evening to find themselves stranded with no public transit and only the remnants of their sobriety.

I have no sympathy for such crass behaviour. Labour deals should be negotiated, not brought about by blackmail. Dalton McGuinty should immediately classify the TTC as an essential service and force the union to go back to work. Since the TTC's monopoly position is not going to be broken up anytime in the near future, there can be no other option - that is, unless we are content to leave ourselves susceptible to random hostage takings.

I, for one, am not.

Surprise! The Canadian Pork Council wants more money

The federal government has just announced an extra $1 billion in loans to livestock farmers with zero interest on the first $100 000 for each producer.

Ottawa announces more aid for livestock industry

[Agriculture Minister Gerry] Ritz says the government is also streaming more money through existing support programs.

He says a producer with 400 head of cattle should get an extra $38,000 in cash and $116,000 in loans.

...

It's unclear whether the aid will be enough for farm groups, who have been calling for unsecured loans and new programs.

The Canadian Pork Council says the industry is facing a crisis of epic proportions due to high costs and low prices.

Indeed, grain prices have been rising recently in global markets, which in turn would raise the price of maintaining livestock. Also, according to Statistic Canada, the price of hogs is only at 77.9% of 1997 levels. The price of poulty, however, has risen by more than 11% over the last year.

Low hog prices must be indicative of either a bloated supply or of relatively weak demand. What is there to be gained by encouraging producers to produce yet more pork? Surely that would only lead to a further deflation of hog prices. And why is the government so eager and willing pad excess pork onto the federal budget?

Jack Layton, Defender of Free Trade

The Moustachioed Socialist swoops in to defend the free market in response to the softwood lumber deal!

We had something called the free trade deal...with the U.S. and this completely violates it. It essentially says that the Americans can break the rules and when they're caught - caught many times by the tribunal under NAFTA - they don't have to pay up the full amount that they took inappropriately, so a billion dollars is still sitting on the table. And it means that other industries are going to look at the Canadian situation and say 'Maybe we should do the same. After all, it looks as though we can get away with it.'

Layton's also got a beef with the 34 percent market share restriction.

This is directly contrary to what the Prime Minister said in the House of Commons yesterday where he said very clearly, 'No tarrifs, no quotas.' Well, the agreement clearly has both tariffs and quotas.

Harper better watch his back!

Interestingly enough, these are tarriffs that now the Canadian government is going to charge, which means of course they'll have to come through the House of Commons as a tax measure, so we'll see what happens when that is brought forward.

Dun dun dun...

Actually, I'm curious too. Here's hoping that the opposition isn't just talking tough on this one.

Knock on Wood

'Twas no mere rumour. The Prime Minister stood up in the House of Commons today to announce that a deal had been reached with the Americans on the longstanding trade dispute over softwood lumber. According to the PM's website:

The United States has agreed to Canada’s key conditions including:

• Stable and predictable access to the U.S. market: there will be no quotas and no tariffs at current prices;
• Repayment of duties: at least four billion dollars will be paid out to Canadian producers;
• Provincial flexibility: there will be different compliance options in response to varying operating conditions across Canada; and
• Certainty: the deal runs for a minimum of seven years with options for renewal at a later date.

Surprisingly, the PM also announced that the deal had the support of the provincial governments of British Colubia, Quebec and Ontario. Earlier in the week, Ontario's Minister of Natural Resources, David Ramsay, said that his government was "very upset with the deal that's there." Perhaps the third bullet point about provincial flexibility was enough to placate him. Regardless, the three major lumber-producing provinces were basically the only ones who could have gotten the deal scuttled at this point. Chalk one up for Stephen Harper.

There is surely some cause for celebration. The softwood lumber dispute has been a sour note in an otherwise good working relationship. With this out of the way, relations between the two countries should become more cordial, as befits the friendship that our countries share. Also, the mere fact that there is a deal now - any deal - will save a lot of grief for the Canadian lumber industry since they lose out the longer the argument simmers. On top of that, with the trend suggesting that the loonie will continue to rise against the dollar, the collected duties currently being held by the U.S. will end up being worth less the longer it takes to get them back.

That being said, there are plenty of reasons to complain. Canada may be getting $4 billion in duties returned, but that leaves $1 billion in the U.S., an amount which will likely end up going mostly to American softwood producers. It's a bitter pill to swallow, but it can be said that a good compromise leaves everybody angry. On the other hand, the first bullet point is a real concern. "There will be no quotas and no tariffs at current prices." What happens if prices change? The details are still murky, but it sounds like CTV got it right when they reported earlier this week that the deal would hold Canada to 34% of the American market. That is roughly what Canada's market share is right now, implying that a quota (or tarriffs) would end up in effect when current market conditions change.

It's free trade, as long as there are no free markets.

I argued before that Canada should not start a trade war over softwood (as Jack Layton suggested during the election campaign) on the grounds that Canada would ultimately lose that battle. But it seems that the government has confused withholding retaliation with capitulating. Canada has lost a few decisions at non-binding WTO tribunals, but has consistently won under legally binding NAFTA tribunals. Canada should have continued along that process, and if necessary, temporarily granting loans to the softwood industry to keep them afloat as the dispute persisted. Accepting anything less than free trade sets a bad precedent.

Softwood lumber breakthrough?

From CTV:

Sources told CTV News on Monday that outlines of an agreement were hammered out by both sides following round-the-clock discussions. As part of an agreement:

• Canadian lumber firms would be held to a 34 per cent share of softwood lumber in the U.S. market. It's roughly the share that Canada currently holds.
• The U.S. would return 78 per cent of the $5 billion it collected in softwood duties beginning in 2002.

The remaining 22 per cent will go to the U.S. lumber industry to help defray the costs of their legal challenges. It is not immediately clear, however, how that portion will be distributed, or what form it will take.

If I was a part of the Canadian softwood lumber industry, I would be ecstatic if a deal has in fact been struck after all these years. It's not an outright victory, but it is better than a stalement.

However, as someone who has no direct stake in this particular dispute, I am not so enthused. Why are we accepting export quotas under NAFTA? It's hardly free trade if you ask me... And having to compensate the American softwood industry for waging their protectionist war is just a kick in the teeth.

Then again, this latest story may just turn out to be a false alarm. The plot sounds familiar...

Brief thoughts on the first Question Period of the 39th paliament

Impressions from about 50 minutes of watching CPAC:

• There was a lot of talk when the Speaker was elected earlier this week about making Question Period seem less like a circus. The much heralded return to civility lasted about 5 minutes by my count. There's just something about jeering while others are speaking that is simply irresistable to MPs of all stripes.
• Stephen Harper is pretty funny sometimes.
• Paul Martin is nowhere near the camera ...or a microphone. That's the way it should be.
• Two Conservative MPs got seats on the opposite end of the floor. That must suck.
• Independent MP Andre Arthur hasn't ripped into the CRTC yet. Or maybe I didn't watch long enough.
  
• I didn't know that Jim Prentice is bilingual. Impressive.
  
• Liberal defector David Emerson got hammered hard by Liberal MP Hedy Fry. On the second volley, the Prime Minister had to stand up to defend him. Emerson is probably going to be taking a beating on a daily basis...
• It is not good that the Minister of Public Works is not able to answer questions in the House.
• I really like the CPAC commercials with Tom Green.

Unwarranted Flak

Some in the media have made fun of the vest that Prime Minister Stephen Harper wore during the trilateral meeting in Cancun this week with President Bush and Mexico's President Fox. I don't see what the problem is. To me it looks like normal attire for a Canadian Prime Minister to wear on such a journey.




Can you spot the difference?

Arik beats Bibi with eyes closed

In Transparency International's most recent Corruption Perception Index, Canada slipped from 12th to 14th with a CPI index of 8.4 out of 10. It is hardly a terrible score, yet the stench of scandal in the wake of Judge Gomery's first report was enough to sink the Liberals on the January 23rd election.

Israel, which just held a general election yesterday, has a CPI score of 6.3. It has fallen to 28th in the rankings, and yet corruption did not end up becoming a major campaign issue. The stakes were higher than the cost of a few dollars in graft. Though social policies were indeed prominent, peace and security issues were the most pressing.

What made this election interesting was the upheaval of the political landscape that led up to the vote. First there was the controversial Gaza Disengagement Plan, pushed through by then-prime minister Ariel (Arik) Sharon. He did this despite objections from his own Likud party. His chief rival in the party, former prime minister Benjamin (Bibi) Netanyahu, resigned from his position as finance minister in protest. By the end of November of last year, Sharon was convinced that he could not advance his agenda as a member of Likud, so he decided to redraw the political map by founding his own party, Kadima, which drew members from both of the traditional parties (Labour on the left and Likud on the right). Less than a month later, Sharon was suddenly and unexpectedly removed from the political scene after he suffered a massive stroke. The final bit of turmoil leading up to the Israeli election came in January with the victory of the terrorist group Hamas in the Palestinian legislative elections, essentially ending any hope for a negotiated settlement.

As such, the choice facing Israelis was essentially narrowed down to either unilateral withdrawals - as favoured by Sharon's brainchild, Kadima, and supported by Labour - or holding on to Greater Israel, at least temporarily - as favoured by Netanyahu's Likud, among others. When the dust settled, it became clear that Israelis chose the former. Even though Ariel Sharon is still lying in a coma, Kadima managed to win the election with 28 out of 120 seats in the Israeli Knesset (parliament), while Labour came in second with 20 seats. The Likud party was dealt a huge blow, winning only 11 seats, which makes it only the fifth largest party in the Knesset.

The people have spoken, but here is the bad news. With the decimation of the Likud, Netanyahu's Thatcherite economic reforms will be off of the government's agenda. If anything, the likely inclusion of Labour into the government coalition will probably mean a complete reversal of the governments economic policies. This is especially worrisome because of Labour's chairman, Amir Peretz, who showed during his time as head of the Histadrut (Israel trade union congress) by frequently calling general strikes on a whim that he is completely irresponsible. The new prime minister, Ehud Olmert of Kadima, will have to keep him on a leash.

Bonus random thought!
Israel is an excellent example of why Canada should not adopt a system of proportional representation. Kadima and Labour, the two biggest parties, do not have enough combined strength to form a stable coalition by themselves. Such is the norm for systems with proportional representation. There are always a mess of small, often one-issue parties who extract concessions from the major parties in exchange for their support in a coalition, thus insuring consistently bloated (and confused) budgets.

Bonus related news item! [Updated 6PM, March 29th, 2006]
Canada takes a stand! The Foreign Affairs Minister, Peter MacKay, announced today that Ottawa is cutting off aid and contacts with the Palestinian Authority, now that Hamas has officially taken power. This is presumably in keeping with Canadian laws against financing terror organizations (Hamas has been blacklisted since 2002). Humanitarian assistance will continue through third-party organizations.

No Turning Back

After a press leak delayed an earlier plan by Prime Minister Harper to make a surprise visit to Canadian troops in Afghanistan, today the PM finally made his first foreign trip, landing in a Hercules transport aircraft in the middle of a Kandahari sandstorm. Back home, NDP leader Jack Layton responded to the news by renewing his call for a parliamentary debate on Canada's role in Afghanistan. Harper would do well to ignore him. His trip demonstrates that that is exactly his plan.

In all likelihood, a parliamentary referendum on Canada's role would pass easily with the support of both the ruling Conservatives and opposition Liberals, who made the commitment while they were the government. But the time for debate has passed. It could be argued that a debate should have been held when the Liberals first made the decision, but that does not change two fundamental facts. First, Canada has made a firm commitment to the international community. Second, Canadian soldiers have already been placed in harm's way, so they deserve the full support of the Canadian people as they carry out their duties. As such, I applaud Mr. Harper for his visit to Afghanistan to support the troops. Upon his return, he should continue to ignore Mr. Layton, but should also remind Canadians what the rationale behind the mission is and why it is important to stay the course.

While I do think that Layton's position on this particular issue is completely amiss, he does have a point about how future military engagements should be handled. A parliamentary debate before deployments are set in stone would be beneficial in determining whether a mission has popular backing. Furthermore, if a mission is democratically decided upon, the debate will be over by the time the soldiers ship out, and they will be able to do so with full confidence.

But I do not go as far as Mr. Layton. Such parliamentary debates should only be held at the Prime Minister's discretion, not required by law. After all, the government may sometimes be called upon to react quickly to events. This was definitely the case after Jean-Bertrand Aristide was overthrown in Haiti. Had Canada and its allies dragged their feet for too long before deciding to intervene, Haiti may have descended into the dire straits of anarchy and it would have been too late. Afghanistan is not quite the same, as I am sure that the Taliban would continue to roam unabated (as per usual) in the Afghani countryside if Canada were to delay its mission to help the Afghani government extend its region of control.

Once Canada's current international commitment expires, Jack Layton and the other 307 MPs should be given the opportunity to debate a renewal. Until then, Layton should chew on his moustache and keep quiet.