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Finance Minister of the Year


 

Ran into Mr. Flaherty’s press secretary the other day in the National Press Building. He explained he was on his way to the television studio across the hall from the Maclean’s bureau because the Finance Minister had to tape an acceptance speech for his having won Finance Minister of the Year. I thought he was making that award up. Apparently, he wasn’t.

Tuesday, Euromoney, a glossy, 40-year-old publication devoted to international financial markets, presented Mr. Flaherty with its award at a noon-hour reception amid juice, wine, sushi and chicken satay. Past winners include former U.S. Treasury Secretary Robert Rubin and Manmohan Singh, who is currently India’s prime minister…

Many Canadian investors will no doubt remember their losses when the finance minister ended the tax benefits of income trusts, and his political opponents in the Liberal party may argue that any reputation he is building benefits from the hard work done by Paul Martin, who is credited with ending a generation of budget deficits.

In an article on Mr. Flarhety, Euromoney characterized his income trust decision as courageous and praised his tenacity on making serious headway on bringing about a single Canadian securities regulator.


 

Finance Minister of the Year

  1. The whole thing has a surreal quality, doesn't it? If somebody had told me a few months ago that this October Harper would be soaring in the polls, Flaherty would be named "Finance Minister of the Year" by Euromoney, and the Liberals would be in mid-meltdown, I would have thought the person who told me these things was high.

  2. The whole thing has a surreal quality, doesn't it? If somebody had told me a few months ago that this October, Harper would be soaring in the polls, Flaherty would be named "Finance Minister of the Year" by Euromoney, and the Liberals would be in mid-meltdown, I would have thought the person who told me these things was high.

    • And a year from now Jack Layton will lead his resurgent party to a glorious first term NDP majority parliament. That is where you were going on this…right! Or would that require some really serious stimulants?

      • Heh. That would require some powerful drugs, all right… I'm thinking hypnotics in the Benzodiazepine class.

  3. JPMorgan Chase won best North American bank at Euromoney last yet. Mr. Flaherty's in good company, it seems.

  4. JPMorgan Chase won best North American bank at Euromoney last year. Mr. Flaherty's in good company, it seems.

    • JP Morgan Chase actually weathered the storm better than the other "Big Four" American banks (Bank of America, Citigroup and Wells Fargo). Of course, that's not saying much…

  5. Colour me skeptical, though not bad for an ambulance chaser I must admit. These Reformers are an interesting bunch. I mean there really isn't a lot of front line talent there. I can't see Flaherty making a ton of money in his post-political career like Mazankowski, Wilson, Mulroney, Chretien, Martin, McDougall etc. In fact, I can't see ANY of the front bench making much of a mark outside of Ottawa. I suspect they'll all just fade away like Harris and Eves. Truly a mediocre class. Thoughts anyone?

  6. Well, there goes 'this incompetent Finance Minister' , 'this incompetent Government',
    need a new line of attack Libs?

  7. Manyp people in Ontario probably some different opinons to yours on Flaherty's competence.

    • Why? The Harris government turned Ontario's economy and finances around. So much so, that McGuinty had to lie that he wasn't going to change it.

    • From what I understand, Bobs Ray Day's is to Ontarians, what Trudeau's NEP is to Albertans…I only have lived thru the horrors of later, so just saying.

  8. True. Though did receive TARP funds and used it to pay themselves fat bonuses and buy up competitors. And have been accused of a lot more.

  9. Regarding the income trust thing, has anyone ever actually done a study on how those trusts performed after the announcement up until last fall's economic collapse. My understanding is that most had actually bounced back so if the "burned" investors had just shown some patience, they would have been no worse off.

    • Steve, the index for the trusts was down only 10% after the announcement. Yes, 10% hurts, but it's not the end of the world. On the other hand, from peak to trough, the TSX as a whole was down maybe 50% due to last fall's fun economic times, so we need to put this all into perspective.

      The commonly held view that Flaherty "destroyed" the wealth of seniors is absurd.

      And no, I doubt any of the trusts right now are at or near the same point as before the Income Trust decision, but that's mainly due to market dynamics, not Flaherty. Those flowthrough trusts worked by twisting their corporate structure into pretzels and taking on a massive amount of debt. Naturally, the "credit crisis" was not kind to businesses with a lot of debt. In fact, had Flaherty let that low interest rate, debt fueled, corporation to trust conversion bonanza continue, I bet we'd be in a LOT worse shape now post/during credit crisis times, but on that score he was just lucky, not smart. In the end, I'd say if someone was dumb enough to have all their money in trusts, then paniced after the announcement and sold, they probably are far better off than if they had all their money in trusts, and didn't sell until the credit monster came and destroyed their savings.

  10. This is news that is sure to get Tory bashers in a lather. Knee-jerk criticism of both Harper and Flaherty have become a staple.

  11. The credit for the resilience of the Canadian economy has been misplaced. The major driver of the recovery has been the low interest rates by the Bank of Canada, not as much the "stimulus" measures. And what does the lawyer know about economics and finance? Mostly, Flaherty just parrots what the Ministry of Finance bureaucrats tell him. The most I give him is some credit (or was this also someone else's idea) for the Home Renovation Tax Credit. As for the banks and financial institutions doing so well through the financial crisis, I credit the policies and institutions adopted after the collapse of oil prices and the consequent banking troubles (the lenders) in the early 1980's. Question: How does a "stimulus" package of $84.9 billion over 5 YEARS equate to an expected $55.9 billion deficit for the current year?

  12. Well that's the difference between wonkishness/great policy, and great politics/populst policy.

    1. The income trust decision was good policy, and HAD to be done (you've all heard the arguments for both sides, so lets not get into that, though) yet many people were FURIOUS about it. Many of these people also tended to be Conservative voters (investors, small business owners, people with incomes > 100k, etc)
    2. The national securities regulator. The usual fiefdom building provincial premiers promised to make a stink, and they still are, but this is so obviously needed, this crisis shows why it's needed, our inability to police our markets shows why it's needed, and the fact that our own Bernie Madoff's were operating for years and years even after being discovered, and then won't be jailed for the next 10 years, vs. the swift 1 year between discovery and life sentence for the real Bernie Madoff, just shows how deficient the current system is.
    3. HST. Hear that sound? It's the idiotic BC NDP organizing a populist revolt, and the hypocritical Ontario Conservative party doing the same (I say hypocritical because one only needs to look at their last election platform for HST and see why it's odd they are suddenly so against it). However, it will lower the cost of capital for businesses by a huge amount, and make large exporting businesses, like our auto plants, want to invest in Ontario again.
    4. He slammed the door shut on the "cash for clunkers"-like BS that continental Europe and the US went gaga over. Thank goodness.

    All in all, some bad political moves, but great policy. After the GST and filling the tax system with holes for special interest groups, I expected the exact OPPOSITE from this Harper clan.

  13. How's old Chisholm doing these days? Is he still short?

  14. 1. Some of it involves tax cuts and multi-year infrastructure spending.
    2. Government revenue is much smaller than it was projected to be when most previous fiscal commitments were being made.
    3. Economic growth projections are worse than expected (possibly)
    4. New deficits also mean billions more in interest payments.

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