For Canadian Banks, It Is Never Enough

It is not enough that banks are making record, some would say obscene, profits. Nor is the fact that the banks' regulatory body, the Financial Consumer Agency of Canada, has not conducted an unannounced audit since 2005. No, it would seem that these institutions want as much as they can extract, even from those customers who fall victim to banking errors and incompetence.

The thinking person must ask, "Why are they being given virtual carte blanche by our government?"

Tiger Williams' Disgrace

Let me be clear. I have not been a fan of hockey since I was a boy, when only six teams constituted the NHL. However, I am struck by the disparity in details between a newspaper and a television news report surrounding the conduct and arrest of former Leaf enforcer Tiger Williams for incidents that occurred on a military flight to Latvia, a flight intended to boost the morale of Canadian troops overseas.

Here is how the Toronto Star reports it:

Former NHL player Dave “Tiger” Williams has been charged with sexual assault and assault following incidents on-board a Canadian military flight as he headed overseas for a morale-boosting visit with deployed troops.

“The charges related to reported incidents during a Canadian Armed Forces flight to Latvia,” said navy Lt. Blake Patterson, spokesperson for Canadian Forces Provost Marshal and military police.

“The accused was a passenger . . . the victim reported the assault during the flight,” he said Friday in an interview.

Williams could not be reached for comment. However, his lawyer, Michael Lacy, issued a statement urging people to hold off judgment.

“I understand from the police it is alleged that Tiger inappropriately touched the complainant over clothing on the buttocks,” Lacy said. “Tiger denies any wrongdoing and is confident he will be vindicated.”

...one official told the Star he believed the hockey player remained on the tour and was not sent home [emphasis mine].

Now here is the unsanitized version of the event, as reported by Global News. You need only watch about the first 52 seconds to learn of two crucial details omitted from the Star report, details of Williams' behaviour that can only be described as shameful and disgraceful:



For me, the stories are significant for two reasons:

First, the disparity between the two underscores the importance of getting our news from a variety of sources for a fuller picture of events.

Second, if Williams' conduct was as egregiously inappropriate as the Global News report suggests, why did the military not take immediate action against him, rather than letting him continue his participation in the tour?

Or is all of the military's recent talk about 'zero tolerance' for sexual harassment and assault merely PR and essentially meaningless?

Who Do You Trust?

When it comes to a choice between believing a government with a vested interest in protecting a $15 billion arms deal with Saudi Arabia and independent reports that those armaments are being used against domestic populations, I tend to side with the later.

Consider the evidence.

The Saudi Arabian National Guard, a buyer of Canadian-made light armoured vehicles, posted this photo on Twitter in November, 2015. It shows combat vehicles being moved to Najran, a Saudi town near the border with Yemen.

Two years ago, the following was reported in the Globe and Mail:

Canadian-made armoured vehicles appear to be embroiled in Saudi Arabia's war against Yemeni-based Houthi rebels – caught up in cross-border hostilities that critics say should force Ottawa to reconsider a $15-billion deal to sell Riyadh more of these weapons.

The Saudi-led coalition fighting the Houthis – who are aligned with Iran – has already been accused by a United Nations panel of major human-rights violations for what its report called "widespread and systematic" air-strike attacks on civilian targets. Along the Saudi-Yemen border, constant skirmishes pit Houthi fighters against Saudi ground forces such as the Saudi Arabian National Guard.

...a retired Canadian general consulted by The Globe and Mail, who spoke on condition of anonymity, identified the LAVs being transported to Najran as fighting vehicles made by General Dynamics Land Systems. Stephen Priestley, a researcher with the Canadian American Strategic Review, a think tank that tracks defence spending, also identified the LAVs as Canadian-made.

Critics say having Canadian-made arms enmeshed in a conflict that has claimed more than 2,800 civilian lives should prompt Ottawa to rethink the recent $15-billion deal to sell hundreds or thousands more to the Saudis.

And last summer, a video emerged appearing

to show for the first time Canadian-made light armoured vehicles being deployed by Saudi security forces in an operation against militants in the Shia-populated eastern part of the kingdom.

EXCLUSIVE: New video purports to show Canadian LAVs being used in Saudi crackdownhttps://t.co/DEfZlfTGXG pic.twitter.com/4YuPPZWmSu

— Levon Sevunts (@LevonSevunts) August 8, 2017

Add to the above the fact that Saudi Arabia is a notorious abuser of human rights, so much so that a group of British lawyers has launched a campaign to remove the country from the UN's Human Rights Council.

None of this, however, has forked any lightning with the Trudeau government. The Toronto Star reports that an investigation by the Canadian government has concluded that there is "no conclusive evidence" that the above is true, and so the arms deal will continue.

Foreign Affairs Minister Chrystia Freeland told a Commons committee Thursday the “independent objective opinion” of her departmental officials [can there truly be independence in a government department?] did not determine that was the case. When the NDP asked for the report to be publicly released, the minister deferred to her department.

As frequently happens with Mr. Trudeau's regime, while they continue to give Saudi Arabia carte blanche in its abuses, they are vowing to toughen up the export permit process.

Governments should be required to deny permits where there is a “substantial risk” that an export on Canada’s control list “could be used to commit human rights violations,” Freeland said.

Freeland said the Liberal government will accept amendments to enshrine such an obligation in law, via a bill now before Parliament to allow Canada to accede to the international Arms Trade Treaty. At the same time, she said, pre-existing contracts would be honoured, meaning the Saudi contract would not be subject to review under new criteria.

That kind of fancy footwork may provide a measure of political cover for a government aiding and abetting the Saudis. However, one can't help but wonder how reassuring it will be to those domestic populations who will continue to be abused by the Saudis and quite possibly fall victim to the Light Armoured Vehicles that Canada will continue to ship to the repressive nation.

A Short Primer On The Fraser Institute

You can read more about this and related issues by visiting north99.org.

Will It Be Vision Or Political Expedience?

In yesterday's post, I wondered whether Jagmeet Singh and the NDP will embrace a form of radical progressivism as it prepares for the 2019 federal election or instead hew to more mainstream policies that they think will make them more electable. In today's Star, two letter-writers offer some important perspective.

Rose DeShaw, of Kingston, Ont., reminds us of a time when the thirst for power was secondary to New Democrats' agenda:

American politics has changed Canadian politics. What we need is not a populist wave or to win big but to build a solid, basic set of public values that express a new and deep intention to reverse the trend of inequality in society by establishing policies of support for all women, men and children in their lives.

The important thing for the NDP is to once again become the conscience of the Canadian government. The old CCF/NDP was concerned with pressing government to improve the lives of Canadians, not by winning elections but by changing the policies of the larger parties to bring in the baby bonus, a national health act, pensions and social insurance, to name a few.

Ken Sisler, of Newmarket, Ont. reminds us of the the failure of our governments thus far, and the vital need for progressive politics:

Yes, it is time for a Bernie-Sanders-style, left-wing populist movement in Canada. The system has failed poor people and working-class people. We need universal pharmacare, dental care, child care, vision care and a $15 national minimum wage. These are not radical ideas. Many countries already have these programs.

We await with bated breath to see what road leader Jagmeet Singh chooses.

A Leap Of Faith?

Thus far, I have been singularly underwhelmed by the performance of federal NDP leader Jagmeet Singh. First, although a well-established Ontario MPP and deputy leader of the provincial party, he showed an unseemly timidity in refusing to seek a federal byelection seat when he had the opportunity. That decision has obviously kept him out of the House, ensuring that he is a largely unknown commodity to both the country and, to an extent, his own caucus.

I also take exception to the way he cheapened his engagement to Gurkiran Kaur by inviting a photographer from The Canadian Press and a reporter from Toronto Life to document his proposal.

Finally, there was his rush to judgement in suspending NDP MP Erin Weir from the caucus without even knowing anything about the harassment allegations against him. I guess he wanted to show he is no slouch in the #MeToo movement.

But I am willing to cut Singh some slack if he proves not to be just an opportunistic politician angling to become Justin Trudeau 2.0 The definitive test will be how he reacts to a movement that has gathered impressive momentum in both the U.S. and Great Britain: radical progressivism.

Susan Delacourt writes :

For the past two years, the Leap Manifesto has been a disruptive force within New Democratic Party politics. Now, on the eve of the federal NDP convention this month, top organizers for U.S. Democratic Sen. Bernie Sanders and British Labour Leader Jeremy Corbyn are coming to town to lend the Leap movement support.

That leftist movement — led by prominent Canadian activists Naomi Klein and Avi Lewis — will stir things up whether the current NDP leader, Jagmeet Singh, likes it or not.

Supporters of Bernie Saunders in the U.S. and Jeremy Corby in the U.K, along with those from the Momentum U.K. movement believe they have common cause with The Leap Manifesto, in which Naomi Klein and Avi Lewis played pivotal roles.

The Leap Manifesto is a declaration, fewer than 1,500 words in total, calling for some sweeping policies to deal with global problems such as climate change, and income inequality. Among the recommendations are an end to all pipelines and international trade deals, as well as calls for national child care program and studies into a basic, guaranteed income.

Given the popularity of Saunders and Corbyn in their respective countries, the disastrous election of Donald Trump, and the disappointing refusal of Justin Trudeau to keep his promises, organizers are convinced the time is propitious to harness a populist left agenda. Says Sanders adviser Becky Bond:

“It really wasn’t about Bernie,” she says. “It really was about a movement of people that are really ready for big change and being able to tap into all of those people and work together to make the change, whether the politicians have it on the agenda or not.”

The ideas linking Leap, Momentum and the Sanders campaign are large ones: fighting climate change, the power of banks and corporations and income inequality.

“When I was handed the Leap Manifesto I saw that this was also happening in Canada . . . a movement of people organizing themselves, not behind a politician, but behind a set of ideas that we could fight for,” said Bond.

Such radical ideas have not found a happy home within the NDP power structure. The question we are therefore left to ponder is this: Will Jagmeet Singh rise to the occasion as the new leader and embrace this momentum, or will he, like Justin Trudeau 1.0, prove to be yet another politician bent only on securing and maintaining power?

Seeking Some Substance - Part 2

In Part 1, I tried to establish that there is a gross discrepancy between the rhetoric and the reality of Justin Trudeau's promise to makie sure corporations pay their fair share. Indeed, if truth be told, his government has done little or nothing to alter the CRA ethos, imposed during the Harper era, to give the corporate world an easy taxation ride. For example, as outlined in the previous post, where other countries are recovering significant sums previously lost to offshore tax evasion and avoidance, Canada has thus far recovered nothing.

The CRA, it appears, would rather indulge in some domestic spying than go after the real evaders:

The Canada Revenue Agency's Postal Code Project is targeting the wealthiest neighbourhoods in all regions of the country, those with gold-plated postal codes, where auditors will pore through the tax filings of every well-heeled resident, address by address.

They're looking for undeclared wealth, signs that a taxpayer is actually richer than their income tax filings suggest.

"Comparing someone's lifestyle — cars, boats, houses — to their reported income helps us identify people who are non-compliant," said CRA spokesperson Zoltan Csepregi.

Class warfare, anyone? Or how about a little misdirection to distract people from the real villains of the piece, the corporations?

In fact, the CRA is really not making any effort to conceal their true motives:

"The Postal Code Project also has the potential to demonstrate to the public that the CRA is actively working towards its fairness objective, which speaks to our integrity as an organization."

While not opposed to this measure, Diana Gibson of the Ottawa-based Canadians for Tax Fairness

said it deals with only a small part of the problem.

"It's a good step. It's a small step," arguing that Canada's big corporations are responsible for about two-thirds of the country's tax avoidance problems.

"We applaud it, even if it's small," she said. "It's nowhere near adequate."

While this government-approved misdirection is taking place,(and one would be exceedingly naive to believe the CRA acts independent of government direction) a new report by The Tax Justice Network shows that Canada is, effectively, one of the world’s more attractive “onshore tax havens.”

Every two years, the Network releases its Financial Secrecy Index, which shows how much

a country’s legal system facilitates global financial crimes such as money laundering and tax evasion.

Canada is No. 21 on the list, slightly higher than its 2016 ranking at No. 23. The higher the ranking, the more financially secret a country is.

“It’s a bad exam grade on the state of the country’s financial secrecy laws,” said Arthur Cockfield, a tax law scholar and policy consultant at Queen’s University. “It means that if you’re a crook or a super rich person who wants privacy, then you can use our corporate laws to hide the identity of the ultimate owner of the shares (of your company).”

You can read the details at the above link, but Cockfield draws a damning conclusion:

“The hypocrisy is that Canada is part of the OECD, forcing countries like the Bahamas, like Panama, to change,” Cockfield said. “We use our power to make them change their laws, but that just makes Canada (a) more attractive place for these crooks. We won’t change our laws.”

So, to repeat the question posed in Part 1 of this post, "What is to be done?"

There are some obvious answers, like closing the loopholes that allow this corporate cheating to take place. That is exactly what a strange alliance between the NDP and the Conservatives (politics does indeed make for strange bedfellows) is calling for:

“The system is designed for multinationals and big companies to avoid tax,” said NDP tax critic Pierre-Luc Dusseault in an interview. “The system is the problem.”

And that worm, Conservative finance critic Pierre Poilievre, chimed in:

“Those who have the financial means to set up complex arrangements are always better off under regimes that are highly complex.”

“The smaller, leaner entrepreneurial businesses can’t afford to have large legal and tax accounting departments that allow them to game the system. So they are automatically at an unfair and unjustified disadvantage,”

Do not forget that we are talking about some very, very significant lost tax revenue that the individual has to make up:

In 2016, Ottawa collected $3.50 in income tax from individuals for every $1 it collected from businesses.

The Star/Corporate Knights investigation revealed that Canada’s 102 largest corporations collectively avoided $62.9 billion in income taxes over the past six years. On average, that’s $10.5 billion less per year than if they paid the official corporate tax rate.

It’s also an average of $100 million missing from the public purse per company, per year.

The message about tax cheating is filtering down to the average citizen as well, with

more than 27,000 Canadians [having signed] a petition calling on the government to raise corporate taxes and close tax loopholes.

The petition also asks the government to consider imposing a special levy on banks, which are the country’s biggest tax avoiders.

While the Big Five banks are collecting record profits, their income tax rates have dropped to the point where companies in the banking sector paid 1/3 the rate of other large Canadian companies in 2015.

At 16 per cent, the tax rate paid by the biggest Canadian banks is the lowest in the G7.

Canada is hardly a passive victim of tax avoidance and evasion. It is clearly a facilitator. If Justin Trudeau's speech in Davos about the need for corporations to pay their fair share is to be seen as anything more than his usual pious pontifications, it is long past due that he finally prove that he is no longer interested in giving these entities the free ride they have thus far enjoyed.