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Now that’s (a little) more like it


 

Tories propose foreign-investment rule changes

Canadian Prime Minister Stephen Harper pledged to loosen restrictions on foreign investment if he’s re-elected next month, in a bid to bolster the country’s competitiveness.

The governing Conservative Party would raise the threshold at which a foreign acquisition triggers a government review to US$1-billion, and allow non-Canadians to own bigger stakes in airlines and uranium miners, according to a statement released by the party today in Halifax, Nova Scotia.

It’s not much, but it’s a start: the limit on airlines would only be raised to 49%, and then only where other countries agree do to likewise. So Canadian air travellers will remain hostage to the domestic oligopoly for years to come. And there’s no mention of loosening similar restrictions in telecoms or the financial sector.

Baby steps, then. But at least it’s a baby step in the right direction!

It’s also good politics. After the serial fiascos of recent days — the failed debate putsch, puffin-poop, Ryan Sparrow, the way over-the-top attack on the Green Shift — the Tories needed to change the subject. Campaign 101: you make news — and yards — with policy.

Of course, whether they would keep this promise, or whether Harper might one day suddenly decide to lurch in exactly the opposite direction — as, for example, in the MDA deal — remains as unknowable as ever.


 

Now that’s (a little) more like it

  1. I think Andrew’s last point is the most important. What we have here is and interesting and possibly beneficial (though minor) policy change.

    And what? A 50/50 chance they’ll follow through after the election?

    I think the Tories’ plan is simply to have a razor thin platform, make a bunch of popular policy and spending announcements (regardless of whether or not said announcements explicitly contradict previous statements and policy announcements by the government) and then decide AFTER the election just how they want to govern, and what they want to do (and, subsequently, which promises get enacted, and which ignored, or directly contradicted).

    It’s been said before that the Harper Tories are a party in perpetual campaign mode, and that seems to me to be true. It doesn’t matter what they announce or what they say, because their plans are all about winning the election, not how they’ll govern on October 15th. I suspect only THEN will we (and they!) discover just what the Tories meant, and what they didn’t!

  2. When your opponent, and only competition for governance, has always set the Platinum Standard for Political Prevarication, should Conservative truth telling ever be an issue?

    Wage and Price Controls, Gas Tax, GST, NAFTA, Childcare.

    Paul Martin, along with all Liberals, and OJ, searching for the Adscam perpetrators.

    Decades of saying one thing, doing the exact opposite.

    Not easily done,I might add, without support in the media.

    I figure Harper should be able to lie his freaking face off for at least 2 or 3 elections before we even start scolding him.

    Two further points:

    1. I think the media is mad he is so much better at something that is usually their somewhat exclusive territory.

    2. Didn’t Harper say he was going to govern like the Liberals?

  3. “Campaign 101: you make news — and yards — with policy.”

    Only if you, Mr. Coyne, and your colleagues, choose to provide policy with as much news coverage as you do the ups and downs, gaffes and zingers of a campaign in full silly-season swing. I wish and hope, for all our sakes, that you prove to be correct.

    It’s hard to dispute that the Liberals, having done precisely what you suggest, have received little benefit in the press for their policy focus. We have encountered Liberal Party policy announcements mainly through the distortions of the Conservatives’ negative ads. Most of the coverage in this election has been about the Tories and their war room woes, their polling numbers and the NDP’s advertising style.

    While Harper’s Team have been committing what in a fair world would be political suicide (radical policy reversals, rampant vote buying, moronic behaviour towards the press and public), and the NDP have been trying to cast their leader as the next Trudeau, all your colleagues can manage on the Liberal front is something about their airplane not being ready for, gasp, four days.

    Let’s face it, the press put down Martin and talked up Harper. Now, smarting from the reality that has been the New Reform Party, your calls for sober debate are a bit late.

  4. “Of course, whether they would keep this promise, or whether Harper might one day suddenly decide to lurch in exactly the opposite direction — as, for example, in the MDA deal — remains as unknowable as ever.”

    What many people don’t seem to understand is that many conservatives have a political belief system first and supporting Conservative party comes second.

    And many of us conservatives are distinctly unimpressed with how the Conservatives have ruled so far. I don’t think we are at the point of conservatives sitting on their hands and not voting this election, though we are close to it, but I would guess Harper will be given one more chance and if they don’t start governing like conservatives awfully soon there will be big problems.

  5. bud: While the Liberals broke a lot of promises, they did it over the course of 13 years. Harper broke one of his promises on his first day in office. Had there been recounts which sent them out of power, he stillwould have had a government of broken promises.

    So while the conservatives may not have broken as many promises in sheer numbers yet, their rate is astounding.

  6. T. Thwim:

    What promise was that?

    Please don’t say Emmerson.

  7. “What many people don’t seem to understand is that many conservatives have a political belief system first and supporting Conservative party comes second.”

    jwl:

    Glad you used the word “many”. I share many conservative political beliefs but cannot find it in my heart to support Mr. Harper. Another leader perhaps? One that steers us away from neo-liberalism?

    (yeah, I know–I used the “many” word too.)

  8. I’d say the more egregious (on Harper’s part) of the two cabinet surprises was Fortier.

    (That wasn’t day one, but close enough that “[h]ad there been recounts which sent them out of power, he stillwould have had a government of broken promises” is still true.)

  9. bud: Fortier.

  10. Did Harper promise not to appoint Senators?

  11. The funniest thing about this issue is that Canada is in a net foreign ownership situation. More Canadians own foreign companies than foreign own Canadian – yes indeed stange that this is rarely reported on same as in real estate do people realize how many of us own property and houses in the good old usa they would be very surprised especially lately there are loads of bus tours right now taking Canadians shopping for foreclosure deals and are getting deals that boggle the mind … who would have thought!

  12. Andrew,

    I could not help but wonder when watching you on CBC’s At Issue last night, whether, along the way, you had dropped your compass somewhere. I mean, your needle seemed to point to somewhere but to where exactly?

    It is certainly your choice to have come to stand behind the Liberal Green Shift. But once you make up your mind you have to remain consistent.
    Harper is consistent in his take on the Green Shift. Besides what the Liberal plan will do to distort the supply and demand characteristics of an open market (an open market you were -and by the looks of it – still are in favor of: are we in fact freer to choose when the Liberal plan is implemented?), the economic consequeces of the plan are real; how would you propose we protect our national productive advantage if countries such as China will be able to produce and export their products without having implemented environmental restraints upon themselves?

    Tariffs?

    Such hypocricy. First the Conservative leadership is severely critized for demanding countries such as China to be included in protecting the global environment (remember Bali) and now, when the issue of tarrifs will need to be addressed (an example of through-your-back-door-approach if ever I’ve seen one)and China will have to mentioned, we seem to want to duck the issue. Great going!

    When Harper mentioned the possibility of the Liberal Green Shift being able to stirr up tensions between the provinces renewed, he did touch upon a very valid point. And besides, what is Quebec’s main beef when it comes to proper interactions between the federal and the provincial juristictions? That each stay within their own juristiction. But the Green Shift has ohter plans.

    I don’t blame you, really, for trying to find direction with a broken needle. I believe it is the Canadian voter at large who no longer forms “a true north strong and free.” And needle broken or not, if there is no true north to find then what does it matter?

  13. I still say when it comes to prevarication, the Liberals play chess and Harper plays checkers.

    Or try this analogy. When it comes to prevarication, it’s like comparing Keira Knightly to Dolly Parton. In many areas they may be similar, but in the most important, there is a huge diffence. Keira is a much better actress.

  14. Well, I suppose that much is true. Harper seems to think Canadians are apathetic enough that he doesn’t even have to try to hide it.

  15. T. Thwim:

    I wrote that before I saw your link. Matters little. I wish our politicians were perfect(apparently only Conservative ones are supposed to be). I wish our system didn’t demand our politicians lie. I wish we had better journalists. I wish for world peace.

    Appointing someone to represent the second largest city in the country doesn’t strike me as important as say, completely reversing yourself on your main election plank. See Mssrs.Trudeau, Chretin and Martin.

  16. T.Thwim:

    No, I think Mr. Harper is very pragmatic. I think he realizes the limitations of our system. I think he, at times takes advantage of it. He is a politician. Smart enough to realize there are certain political realities. The places where he has been less than forthright, have in my opinion, been areas that he did the right thing, to his detriment. Fortier, Emmerson, Income Trusts.

  17. Andrew,

    You don’t seem to pass judgment on the MDA deal, only noting that Harper went back on his word. But in this case, would you not agree that our national security interests trumped any economic considerations?

  18. Bud. He didn’t need to appoint him to senate. He could have appointed him directly to Cabinet. But of course such a move wouldn’t give Fortier the pay/perks/pension of a senator, and would leave him accountable to the House.

  19. T. Thwim:

    Accountability is a rare thing anywhere.

    Fortier resigned his Senate seat ,as promised, to run in this election.

  20. Appointing “civilians” is an American thing, more’s the pity.

  21. Hi Andrew,

    I’ve been thinking about protectionism vs free trade for a while now, trying to figure out what side it is that I agree with. You seem to be very clearly in the free trade camp, and I respect your opinion, so I figure I should give it a fair shake – it certainly has its compelling arguments.

    I did recently come across this, from a lecture by Herman Daly, and I wondered how it might figure into your calculations:

    “In today’s world it is the nation that internalizes environmental and social costs into prices. If a cost-internalizing nation establishes relations of free trade and free capital mobility with cost-externalizing nations, then it will lose out in the competition. Its own producers will move to the cost-externalizing countries since capital is mobile, and still sell without penalty in the market they just left, since trade is free.”

    “Free trade and free capital mobility lead to a standards-lowering competition–a kind of Gresham’s Law in which bad cost accounting drives out good cost accounting–cost externalization drives out cost internalization. Ricardo’s nineteenth century comparative advantage argument that guaranteed mutual benefit from free trade was explicitly premised on internationally immobile capital. In the twentieth century world of free capital mobility it is no longer applicable. Free traders must either advocate capital immobility to keep the world safe for comparative advantage, or else abandon the comparative advantage argument and recur to arguments based on absolute advantage. Certainly one can argue that world output will increase under free trade based on absolute advantage, but no longer is it the case that each nation must gain.”

    (From “The challenge of ecological economics: historical context and some specific issues”, Heineken Prize Lecture, Amsterdam, 1996.)

    Daly was arguing in favour of protectionism in markets that force accounting of ecological costs, but I think his argument also applies to situations (like Canada’s) where there are other built-in costs of production, e.g., higher corporate taxes…

    I guess the argument could be made that capital is -not- mobile if there are restrictions on foreign investment, hence restricting it only lets capital flow out, and never in.

    But it’s a big, ugly issue, which I’ve never really been able to come to a conclusion on. Do foreign corporations really have any incentive to invest in local projects? Do they really generate growth more than domestic corporations? Doesn’t it encourage clueless foreigners to buy up Canadian companies and drive them into the ground? (The Wendy’s purchase of Tim Hortons seemed to be on that course for a while.)

    Now that I am reading these other comments, Francien Verhoeven’s observation of your support of the Green Shift does seem kind of tricky…

  22. Loosening the limit on foreign takeovers will not help the economy. It’ll just reduce the scrutiny upon foreign investment who want the right to own a name and then move a product overseas, where in the case of manufacturing, they win.

  23. Mike G.

    My concern raised is mostly in relation to consistency of any program instituted. But consistency hangs together with how we understand logic to work.

    For instance: let us assume that environmental pollution is at least partly caused by humans(to assume this is of importance when sorting out the set of policies to be implemented). And if the pollution is partly man made and we therefore find it necessary to prod people into doing something about it, we will decide to tax certain aspects of our behaviour. The options on this vary. The Liberal party has decided to NOT go after the consumer directly. The Liberal party has seen it fit to tax the polluter at its most basic point of interaction with pollution, namely at the point of energy production. Those taxes collected then will be passed onto the consumer, who, after the taxes have been set for several energy producers accordingly, will face higher cost for heating (and fuel, transportation etc). This trickling down effect casts a wide net, but in essence Dion believes that the collection of new taxes will offset the additional cost passed onto consumers by giving the consumer a tax break.

    But here’s the thing. If the manufacturing sector will be facing higher operating costs also as a result of passed on costs, and therefore products manufactured in Canada become more expensive, it could be true in theory that the tax credits being given to consumers could offset the difference, but there is no guarantee that this aspect of ‘neutrality’ will even out the wider distortion of goods to be produced nationally and goods to be produced internationally.

    If Chinese products will become cheaper in relation to Canadian goods produced (some as a result of China NOT implementing a level of environmental taxes of their own)and the consumer decides to buy more and more goods produced in China, then Dion’s plan for taxes in and out may have been neutralized consumer wise, but not for the economic outcome in general. Afterall, no leader can ever decide what or what not the Canadian consumer is allowed to buy in the end.

    But besides that, and at this point the Green Shift becomes even stranger, if the Canadian consumer decides to buy more and more goods produced in China then we in fact cause more global pollution to occur besides.

    Remember, if the Green Shift makes it more expensive for Canadian manufacturers to produce goods here in Canada as a result of higher taxes being levied against energy producing companies, who in turn will pass on such additional cost to users of energy (manufacturers being big users amongst them) then the Green Shift leaves many, many questions to answer indeed.

    Let’s leave the notion here that the Green Shift migh also carry the potential within for a loss of freedom for consumers; for possible increased tension between provinces; for possible increased tension between the feds and the provinces, because I think trying to explain to the Canadian voter what I have set out above might be more than enough to deal with in one campaign.

    It is obvious that the Liberal Green shift has many question which are not so simple to answer precisely because the plan plays havoc on so many fronts.

    Tariffs anyone?

  24. Hi, Andrew. First time blogging here but not my first time blogging… so I’ll get right to it. Harper’s agenda is easily seen here:

    http://nationalcitizens.ca/cgi-bin/oms.cgi?rm=show_category&cid=1

    and here:

    http://nationalcitizens.ca/cgi-bin/oms.cgi?rm=show_product&pid=2

    Did you forget who Harper worked for for 5 years and what this organization has been up to in Canada since the late 60’s?

    http://en.wikipedia.org/wiki/National_Citizens_Coalition

    Its about market share, Andrew and we’ve got a PM that is a U.S. multinational lobbyist that gave up his old job. Canadians have economic sectors protected for big reasons, namely survival. If our film industry isn’t funded, it doesn’t survive. If our Canadian banks aren’t protected from foreign M & A’s, they won’t survive. They’ll get bought out and in mere years, we would lose our economic sovereignty just like that. Other nations would decide whether we are worthy of “capital”. Insurance? Healthcare? Penal systems? Police? Judicial systems? Education? Do you really believe we should privatize ESSENTIAL SERVICES and leave what is private, our Can corps, unprotected against M & A’s?

    Think long and hard Andrew and ask yourself if you truly believe that “for profit” essential services will deliver the “best price” for the consumer every time. You have heard of the word oligarchy and monopoly, synomynous with “price fixing” and “consumer gouging”, have you not? How can axing the CWB as an example, which hands over the entire shipping, handling and international sales
    of grain to the biggest U.S. corporate monopolies be good for Canada?

    What government in their right mind would pass over ownership/control of entire economic sectors to foreign corporations overnight?

    We can’t tax them, Andrew. Just like we can’t tax the majority owned corps who own Canada’s commodities.

    Take IT’s as another example. These were Can corps that had fundamental problems with their personel or their ability to grow their business. The one thing that kept them protected from M & A’s was high share value. When Flarehty taxed them, he dropped their value overnight and left them as easy prey to foreign M & A’s. Who would do that? Who in power would deliberately shrink their own national corporate tax base?

    A U.S. bought corporate lobbyist, thats who.

    This nation is a hybrid of private/public for excellent reasons. We have had some sectors in the past completely protected form foreign M & A’s for big reasons: Survival. Consumer protection. Inclusion/affordabilty of services. Economic Sovreignty. Growing tax base!!! And we’ve got wide open internationally accessed markets right along side of them. We are in globalization in major ways when it comes to commodities. Its not like we are socialist here, deserved of “liberal” or “socialist” or “so very French” Republican slurs. Canadians simply know that some of our economic sectors need to be protected for obvious reasons and up until Harper, we’ve done that.

    I remember a time when we had a government that did what was best for the consumer. Remember them? I voted for them myself. The consumer came first. Quality safe products… sustainability was a word used in terms of where these products came from and how they could be environmentally sustained over long timelines. Affordability mattered. Jobs mattered. Growing tax base mattered from growing GDP to higher personal/corporate income, it all mattered!

    None of that matters now with the government we’ve got. Making sure U.S. corporate ownership and control of our economic sectors matters more to our Harper government now… because thats always what its been about. Ownership. Control. So I guess my big question is… if thats what its really all about (ownership/control), then why is this government so anxious to deregulate and privatize? If whats best for the consumer what its all about, then why are we leaving ourselves unprotected to foreign buyouts by the U.S. corporate lobbyist NCC puppet plant Stephen Harper?

    An even better question… why would any Canadian in their right mind (unless they were either incredibly naive or could profit or gain at the expense of the rest of us Canadians) support Harpers agenda?

    Just askin’

  25. Mike G.

    Thanks for inserting this:

    (From “The challenge of ecological economics: historical context and some specific issues”, Heineken Prize Lecture, Amsterdam, 1996.)

    I’ve always known that Heineken beer is good, and this might be an interesting read! (especially for the NDP, because I believe their core intentions could relate to what this book is trying to explain, but I haven’t read it all…..).

  26. Lorne McQuaig, certain sectors in Canada are protected because rich, powerful Canadians want it that way. Behind almost every protected sector is a wealthy Canadian family who has benefited from that protection for generations. These protections aren’t helping Canadians, they’re shielding the domestic empire-builders from competing bids and competing products. Don’t get me wrong, I like it when Canadians get rich. But not when they get rich because their entire industry has been sheltered from competition at my expense.

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