Bill Morneau's Tax Reforms

I have been following with interest the current discussion, sometimes waxing into hysteria, over Finance Minister Bill Morneau's plan to close small-business loopholes that allow such 'mom and pop' operators as lawyers, doctors and dentists to evade paying their full share by "sprinkling income" to family members who do not actually work for these incorporated entities.

If this is just one of many reforms being planned, it is a good start. If it is to be the only reform, it is a paltry effort, as it will yield only $250 million annually, and perhaps only intended as a form of 'bread and circuses' for the masses.

While the usual suspects are calling it a tax grab and predicting dire consequences, I am happy to report that many others see it as simple justice and have a more mature view of taxation in general.

The following two letters from The Toronto Star illustrate views that are anything but reflexive denunciations.

Re: Morneau not swayed by tax-plan backlash, Sept. 6

I am writing in regard to the well-funded backlash against amendments to our tax laws that will finally close a fraction of the loopholes that unduly benefit Canada’s wealthiest citizens.

I am a middle-aged, median-income wage earner who pays his full tax bill every second Thursday. I come from a family of business people and I possess no particular bias against productive entrepreneurs or the genuine spirit of entrepreneurship.

In my experience, business owners are primarily motivated by a desire to be their own boss. As proud and independent operators, they would be the last people to come looking for a crutch from government. But that is exactly what successive Liberal and Conservative governments have provided.

Our tax system has become the ultimate insider deal, in which the well-connected consistently rewrite the rules to escape the rational and just responsibilities that should be placed upon them by a progressive income-tax system in a democratic nation.

It is beyond any doubt that we have a two-tier income-tax system, in which wage and salary earners are routinely expected to pay their full share. Meanwhile, far too many entrepreneurs play by a set of rules concocted for their own benefit, with the exclusive goal of shifting the tax burden to others who can afford it less.

The Liberal Party ran on a platform of respecting the middle class and I cannot imagine a better opportunity to demonstrate your commitment to that platform than by tackling the egregious and entirely undemocratic imbalance in our tax system.

I am not underestimating the amount of guts it will take to tackle the monstrously dysfunctional and distorted tax laws of this country but a refusal by the Liberals to do so will leave the door open for others to champion the cause.

We need a tax system that puts the needs of the country ahead of the needs of the country club. Will you actually take on that challenge?

If middle-class Canadians had the same attitude toward paying taxes that the people at the top did, our country would be just another bankrupt, basket-case banana republic.

Democracy is not free, nor is it particularly cheap. Please share that information with those who are panicking at the prospect of finally paying their fair share.

Mike Vorobej, Ottawa

Canada has finally got economics right. I am seeing more and more Mercedes, BMWs, Lexus, Audis, Range Rovers, Maseratis and Teslas, along with the increasingly frequent Bentleys, Ferraris and Lamborghinis. According to BMO, luxury car sales have increased 37 per cent since 2013.

Just think, years ago, all that money would have been redistributed — wasted! — through a progressive tax system to provide resources for kids with disabilities in school, to reduce health-care wait times, to fight poverty, to support the elderly and so on.

If this is what a free society looks like, then our fiscal policies are right on track. Tax cuts since 2006 redirect $43 billion per year from social programs to individuals, and the top 20 per cent of income earners take 36 per cent of that.

Canada has been lowering the corporate tax rate for years, arguing it stimulates growth. Meanwhile, corporate divestment increases as taxes get lower.

The upside is that those billions of dollars go to wealthy shareholders who pay a fraction of the tax rate on that income than those who actually work for a living.

Which brings us back to the increased number of luxury cars on the road. Well, that and borrowing against home equity, but let’s not burst that bubble.

Mark Davidson, Toronto

Simply Shameful

The other day I noted the difference between Canadian and American coverage of natural disasters. Canadian news does not shy away from references to, and analyses of, climate change, while American news, doubtlessly due to corporate decree, treats it as a theoretical/ideological/political construct not to be mentioned. Apparently, not running afoul of the powers-that-be and influential network sponsors takes precedence over the truth.

If you go to the three-minute mark of the following NBC Nightly News report, Al Roker gives Lester Holt his morally bankrupt version of the meteorological facts of life.

He Takes A Nice Selfie, But Secrecy Is His Real Forté

Those of us who follow politics fairly closely know that there is frequently less than meets the eye in the Trudeau government. Certainly, the Prime Minister talks a reasonably good game, and his selfies are world-renowned, but scratch the surface and you will find increasing evidence that the emperor is, at the very least, scantily-clad.

There is, of course, Trudeau's widely-known betrayal of his election-campaign commitment to electoral reform. We were told that there just was no consensus, a claim widely ridiculed since the government never asked Canadians what new voting system they preferred.

But even more worrying than that lie is the disparity that exists between his rhetoric about climate change and the reality of what he is pursuing in relative secrecy, one that seems to be very close to what we often euphemistically call 'industry self-regulation'. Gloria Galloway writes:

Environmental groups say they are surprised to learn that the federal Liberal government has been rewriting and consolidating the regulations governing offshore oil and gas drilling for more than a year without informing them or obtaining much input beyond that of the petroleum industry.

The current draft of the regulations requires the oil and gas industry to implement the safety measures that companies determine to be "reasonably practicable," but the environmentalists say it imposes no minimum standards.

[This suggests that] the proposed changes would allow the industry to decide what safety measures can be reasonably and practicably implemented, the environmentalists say. They suggest oil and gas companies would be able to argue that some are too expensive or too difficult.

Known as the Frontier and Offshore Regulatory Renewal Initiative (FORRI), consultations began last year and are now in their final stages. And the excluded groups are not only environmental organizations, but also indigenous groups, quite remarkable given the Trudeau government's blather about reconciliation.

... while the FORRI website includes many responses to the draft regulations from the petroleum industry, the only Indigenous feedback is from the Inuvialuit Regional Corporation (IRC), an Inuit company that manages a land claim in the western Arctic. The IRC expressed significant concerns about the initiative and the consultations.

Other Inuit groups, including the Inuit Tapiriit Kanatami and the Qikiqtani Inuit Association, which represents Inuit on Baffin Island, say they got no opportunity to give input.

Make of all of this what you will, but I don't think one has to be especially cynical to be very, very concerned about giving the oil and gas industry more freedom, worried as we all should be about our collective future, especially given the global climate disruptions we are currently in the midst of.

The Evidence And The Explanation

One of the big differences I have noticed between Canadian and American news is that while the former frequently addresses and uses the term climate change in their coverage of 'natural' disasters,' the latter almost never employs the phrase nor attempts any meaningful analysis of the underlying causes of catastrophes they commonly report on.

Last night, Global National addressed climate change head-on in relation to Hurricane Harvey. However, if you watch to the end of the report, you will see how deeply and shockingly ingrained denialism is in the psyches of many, many people.



Meanwhile, Matthew Hoffmann writes that the time is long past when we can think of climate change as something separate from our everyday lives:

The gulf between the enormity of the climate change challenge and our readiness to undertake it is staggering. This is painfully obvious when climate change is visible, when we are faced with the evidence that the impacts of climate change are happening now with devastating consequences. But this gulf is also evident in society’s failure to internalize climate awareness and concern. As a society we are simply not fully “woke” to the idea that climate change is not some discrete problem to solve; it is, as characterized by climate scientist Mike Hulme, a part of the modern condition. Addressing and living with climate change requires serious transformation of society. We have a lot of work to do and it will not be easy.

Unless and until we are able to honestly confront climate change and the role we all play in its ever-worsening effects, we can expect ever-more frequent reports of its increasingly devastating consequences for the entire world.

*Echoes Of History - Part 111: Contemporary Economic Terrorism

I must confess that I continue to feel the impact of reading The Blood of Emmett Till. This is a good thing, as it has made me much more aware of the long road involved in the journey to civil rights in the United States, a journey that was regularly punctuated, not just by physical violence but also by violence of the economic kind.

In 1955, these threats were potent weapons to stop Black people from registering to vote, something the racists of the time feared would lead to them exerting electoral power and attaining political office. Nipping such efforts in the bud was the default position of the time.

One of the most insidious mechanisms for this operated through the White Citizens' Councils, a less violent version, if you will, of the KKK, their goal being to silence leaders in the Black movement through economic pressure. A prominent doctor and entrepreneur, T.R.M. Morton, founder of Regional Council of Negro Leadership (RCNL) in 1951, was a crucial leader in the fight for civil rights as well as justice in the murder of Till. As a result of his activism, he faced a situation where banks would no longer extend credit to him, suppliers severed their relationship with him, etc., the goal being to financially hobble him into silence, a quest that failed badly.

Black store owners were also victims in this battle to stop the civil rights movement. They lost their customers as the White Citizens Councils made it known that anyone doing business with them would face their wrath, including job loss. Tremendous economic cudgels were wielded, but many still resisted, despite the peril.

When you juxtapose the depth of character required for someone to risk life. limb and livelihood in the pursuit of justice and equality for all with the supremacists' claim to superiority because of the mere color of their skin, the sheer emptiness of their claims is laid bare. People who hide behind sheets, march in angry groups and preach hatred are hardly what most of us would label as people of character.

Sadly, economic weapons are still being today. Consider the situation of NFL quarterback Colin Kaepernick, a quarterback with the San Francisco 49ers for three seasons who rose to fame (notoriety if you are of a certain bent) by refusing to stand for the American national anthem, opting to instead kneel, motivated by what he viewed as the oppression of people of color in the U.S.

Kaepernick opted out of his contract at the end of 2016 season to become a free agent. Despite the fact that there are 32 NFL teams, not one has even offered him a tryout. This fact recently occasioned a protest outside of NFL headquarters.


ABC Breaking News | Latest News Videos

Scott Stinson puts to the lie the non-racist reasons cited for not giving Kapernik a new football opportunity:

The idea that all the NFL rosters are filled out with quarterbacks who are better than Kaepernick at the skills required is simply nonsense. Over his five seasons of mostly full-time work, the 29-year-old has a career rating of 88.9. That is 17th ALL TIME. Sorry for yelling. Kaepernick’s career rating is better than those of Dan Marino, Brett Favre, and Troy Aikman. Also, John Elway and Warren Moon. And Dan Fouts. Phil Simms, Joe Theismann. I’ll stop now. Jim Kelly and Johnny Unitas. OK, now.

The past cannot be changed, and the future has not yet been written. Confronting the racism of both past and contemporary society is something the Americans have a great deal of difficulty doing, and to be sure, it is no easy task. Only now is Canada coming to grips with our abuse of Indigenous peoples, and the road to reconciliation will undoubtedly be a long one. Until Americans are willing to walk the same path, things will only continue to deteriorate for all.

* If you are interested, Echoes of History, Part One, can be accessed here, and Part 11, here.

There Is A Lesson Here For All Of Us

While no rational person could fail to see ever-worsening climate change as a major contributor to the Houston flooding, there is a compounding problem, as the following report makes clear.

Surely there is a lesson here for all of us.



As to how urban engineering can help address this problem, my thanks to Things Are Good for this:

No Matter What His Motivation Might Have Been, This Is Just Wrong

ATLANTA—A white Cobb County police lieutenant has been moved to administrative duty for telling a white woman during a traffic stop, “Remember, we only shoot Black people.”