On Tax Fairness

Ed Broadbent recently wrote on the need for real tax reform, calling for an end to the various favours our government bestows on the ultra rich. His thesis was compelling:

Tax avoidance and evasion by the rich ultimately undermines democracy: it starves social programs and public services, increases after tax income and wealth inequality, and further concentrates economic resources in the hands of a few. The overall message to a majority of Canadians is that the rules of the economic game are rigged against them.

He went on to excoriate the Trudeau government for its hypocritical failure to pursue real tax reform:

The Liberals promised change. In their 2015 election platform, they promised to “conduct a review of all tax expenditures to target loopholes that particularly benefit the top 1 per cent.”

But there has been no broad public review in which citizens could participate. And action to date has been limited to stopping abuse of some private corporation rules. Minister Morneau has said he will impose higher taxes on the small number of private corporations that shelter investment assets of more than about $1 million, which is an action that should be supported.

While I did not agree with all of his suggestions, I doubt there would be many who would dispute Broadbent's thesis. In today's Star, readers offer their views on his piece as well as the sickening truths made evident in the recently-released Paradise Papers. Here is but a sampling of their thoughts:

Ed Broadbent writes, “The case for taxing investment income on the same basis as employment income on the grounds that ‘a buck is a buck’ dates back to the Carter Commission of the 1960s when another Liberal government failed to act on it.”

The problem is the ultra-rich are Prime Minister Justin Trudeau’s personal friends and he prefers to run defence for them than to do what is right for the public good.

Former finance minister Allan MacEachen tried to reform the tax system under then-prime minister Pierre Trudeau but, like Carter before him, the government of the day distanced itself from any idea of true reform and let both of these truly honourable men get practically eviscerated by all the real (rich) powers. It’s all about the Golden Rule: “Them that’s got the gold makes the rules.”

Jennifer A. Temple, Welland, Ont.

After decades of tax avoidance by Canada’s wealthy, we now have the exposure in detail of the Panama Papers and the Paradise Papers.

Our current federal government assures Canadians it will restore the principle of tax fairness. Why should Canadians believe this promise? It is the political process and our elected MPs that preserve this economic injustice.

As the Star reported, Parliament and those who bankroll them control the law. It is highly unlikely the wealthy will forfeit their advantage simply because Canadians think it’s unfair.

Talk is cheap and the government won’t move until pushed. I challenge all Canadians to organize a Canada-wide tax boycott. Until tax fairness is achieved, we should refuse to pay any taxes owing, beginning April 2018.

And every MP should be lobbied to support an immediate tax overhaul. Tax fairness can only be achieved by law, not mealy mouthed promises by those concerned only with preserving their own self-interest to the detriment of the rest of us.

Gordon Wilson, Port Rowan, Ont.

Ed Broadbent shines a bright light on the biggest issue of our time: tax reforms that will cut through many complex aspects of our socioeconomic system.

A progressive and clearly defined tax system would address many issues we have been struggling with since the dawn of the 21st century.

We need a tax system that encourages savings and productive investments, while it shifts the tax burden from working people to the wealthy and big corporations. For many years, the middle- and lower-class have been paying taxes while the rich have been taking advantage of it.

A reformed tax system will prevent the creation of generations of wealthy individuals and corporate monopolies, which have taken advantage of societal privileges without paying their fair share. The wealthy have made their money on the backs of the working people.

The Paradise Papers show how the rich, with the help of law firms, have parked 12 per cent of the world’s wealth in offshore accounts, which does nothing to improve the economy. The sheer number and diversity of people and corporations involved in these tax havens is frightening. It is truly like discovering a galaxy of hidden money that public officials have a hand in helping hide away.

Reforming the tax system is possible if there is political will.

Ali Orang, Richmond Hill

A Political Shakespeare?

Looking back at the pleasure I always took in teaching Shakespeare's tragedies, I realize my attraction to The Bard had a great deal to do with his eerily penetrating insights into human nature, arrived at long before the advent of modern psychology. Similarly, for a non-fiction titan, I have long looked to George Orwell for his ability to pierce the patina of civility that hides what are often monstrous political realities.

On Literary Hub, Kristian Williams has published an essay discussing Orwell's Notes on Nationalism, which he wrote in 1945. Considering the fraught nature of political discourse and alliances we see today at both ends of the political spectrum, Orwell's insights, like those of Shakespeare, seem timeless.

First, Orwell defined his term:

By “nationalism” I mean first of all the habit of assuming that human beings can be classified like insects and that whole blocks of millions or tens of millions of people can be confidently labelled “good” or “bad.” But secondly—and this is much more important—I mean the habit of identifying oneself with a single nation or other unit, placing it beyond good and evil and recognizing no other duty than that of advancing its interests.

That definition alone paves the way for his theme.

Elsewhere he describes nationalism more simply as “the lunatic modern habit of identifying oneself with large power units and seeing everything in terms of competitive prestige.”

In nationalism, Orwell was considering ties that go beyond state affiliation:

... “the emotion I am speaking about does not always attach itself to what is called a nation. . . . It can attach itself to a church or a class, or it may work in a merely negative sense, against something or other and without the need for any positive object of loyalty.”

Clearly, one does not have to look far in the world today to see why those can be such poisonous allegiances.

Within this framework, Orwell lists three “principal characteristics of nationalist thought”:

1. “Obsession. As nearly as possible, no nationalist ever thinks, talks or writes about anything except the superiority of his own power unit.” His special mission is to prove that his chosen nation is in all respects better than its rivals. Therefore, even to the outer limits of plausibility, any question may be traced back to this central issue. No detail is indifferent, no fact is neutral.

2. “Instability.” The content of the nationalist’s belief, and even the object of his devotion, is liable to change as circumstances do. “What remains constant in the nationalist is his own state of mind”—the relentless, reductive, uncompromising fervor. The point is to keep oneself always in a frenzied state concerning vicarious contests of honor, whether indulging in spasms of rage over perceived insults or in sadistic ecstasies celebrating some new triumph. It is the single-minded intensity that matters, not the ostensible cause.

3. “Indifference to Reality.” Nationalists achieve by instinct the kind of doublethink that the denizens of Airstrip One cultivated by conscious effort: “Nationalism is power hunger tempered by self-deception. Every nationalist is capable of the most flagrant dishonesty, but he is also—since he is conscious of serving something bigger than himself—unshakably certain of being in the right.” His fundamental belief, he feels sure, must be true; therefore, the facts will have to be made to fit it.

I won't insult you by pointing out the obvious truth of these observations, but one needs only check out social media, the blogosphere and online commentary to get some quick and easy examples.

There is much, much more to essay, but I will end with this powerful paragraph, which could have been written yesterday, taken from Orwell's diary:

We are all drowning in filth. When I talk to anyone or read the writings of anyone who has any axe to grind, I feel that intellectual honesty and balanced judgment have simply disappeared from the face of the earth. Everyone’s thought is forensic, everyone is simply putting [forward] a “case” with deliberate suppression of his opponent’s point of view, and, what is more, with complete insensitiveness to any sufferings except those of himself and his friends. . . One notices this in the case of people one disagrees with, such as Fascists or pacifists, but in fact everyone is the same, at least everyone who has definite opinions. Everyone is dishonest, and everyone is utterly heartless toward people who are outside the immediate range of his own interests and sympathies. What is most striking of all is the way sympathy can be turned on or off like a tap according to political expediency. . . . I am not thinking of lying for political ends, but of actual changes in subjective feeling. But is there no one who has both firm opinions and a balanced outlook? Actually there are plenty, but they are powerless. All power is in the hands of paranoiacs.

UPDATED: A Pro Forma Response

While Justin Trudeau will undoubtedly be praised by some for his polite reaction to these activists, his perfunctory response tells all you need to know about the disparity between his usual soaring rhetoric and his increasingly disappointing environmental performance.

Prime Minister Justin Trudeau thanked a pair of environmental protesters for their "activism" after they interrupted a press conference in Vancouver to question his commitment to fighting climate change.

Hayley Zacks, 20, and Jake Hubley, 24, rose from their seats to ask the prime minister for a "moment of his time" so that he might explain why he approved the contentious Kinder Morgan Trans Mountain pipeline expansion.

The prime minister let the protesters say their piece but did not defend his position on resource projects.

Zacks noted the project will run through unceded First Nations territories and said young Canadians are scared the planet will become "unlivable" because of climate change.

"The Kinder Morgan pipeline is going to increase emissions from the tarsands, it is going to poison our water, our lands, and everything that we hold dear," she said before being escorted away by security members.

"Thank you for your questions, for your activism. Keep up the activism please," Trudeau said. "It's great to see young people stepping forward and sharing their concerns and views. We certainly take those very seriously."

UPDATE: This is the kind of environmental disaster that seems inevitable, Mr. Trudeau's enthusiasm for pipelines notwithstanding:

TransCanada Corp. said its Keystone pipeline has leaked an estimated 795,000 litres of oil in Marshall County, S.D., just days before Nebraska is set to decide the fate of its Keystone XL pipeline.

The company said its crews shut down the Keystone pipeline system early this morning between Hardisty, Alta., and Cushing, Okla., and a line to Patoka, Ill., and that the line is expected to remain shut while it responds to the spill.

Theatre Of The Absurd

Any facile defence of Roy Moore's creepy predilections has to be regarded thus. His attorney, Trenton Garmon, even tried to draw Canadian Ali Velshi into the fray.

UPDATED:Engagement Is Always Preferable

There is a strong argument to be made for engagement rather than confrontation. Until we are willing to show at least a modicum of tolerance for the views of others, however regnant, all we are really doing is shouting at one another. However, I suspect that it is impossible to follow such a strategy when dealing with the supremely stupid, the woefully ignorant, the rancidly racist and the perniciously partisan, to name but four qualifiers.

Assign what category you will to Brandon Mosely, a writer for the Alabama Political Reporter and staunch supporter of Senate aspirant Roy Moore, whose apparent predilection for exploiting young girls is the source of the most recent ructions in the good ole U.S. of A.

UPDATE: The New York Daily News is reporting that consummate consumer Moore was banned from the Gadsden Mall in his hometown for his, er, shopping habits:

The former Alabama Supreme Court Chief Justice reportedly cruised the mall for dates, both AL.com and New Yorker reported Monday.

Blake Usry said Friday and Saturday nights was prime time for Moore to visit the shopping hub.

“Like the kids did,” Usry told the Alabama paper.

A police officer named J.D. Thomas told mall employees to be on the lookout for Moore because he was “banned from the mall,” Legat said.

“If you see Moore here, tell me. I’ll take care of him,” the cop reportedly told Legat.

Police officers who spoke with the New Yorker said Moore’s presence at the mall was a problem.

“The general knowledge at the time when I moved here was that this guy is a lawyer cruising the mall for high-school dates,” one of the officers said.

“I was told by a girl who worked at the mall that he’d been run off from there, from a number of stores,” another cop recalled.

Impossible To Ignore

I have noticed a shift lately on the part of the ultra-right. Instead of denying climate change, increasing numbers are 'admitting' that the climate may be changing, but they have no idea why.

The following may help to open the eyes of such willfully ignorant souls:

Sounds About Right

I don't suppose it should surprise anyone that an egregiously incompetent President Trump has nominated as a federal court judge for Alabama the egregiously unqualified Brett J. Talley. He

has never tried a case, was unanimously rated “not qualified” by the American Bar Assn.’s judicial rating committee, has practiced law for only three years and, as a blogger last year, displayed a degree of partisanship unusual for a judicial nominee, denouncing “Hillary Rotten Clinton” and pledging support for the National Rifle Assn.

The Senate judiciary committee has approved his nomination.

Sounds about right.

Seeing The Light

This is nothing like a reformed evangelical who has seen the light:

Appearing on MSNBC’s AM Joy, former evangelical – and son a a famous pastor — angrily tore into the Republican party for backing “rape, child molesting and neo-Nazis,” in a furious broadside.

Speaking with host Joy Reid, former Christian evangelical Frank Schaeffer was clearly enraged at the continued candidacy of Judge Roy Moore who has been accused of sexually assaulting four women when they were in their teens and he was in his thirties.

Canadians React To The Paradise Papers

If you aren't yet outraged over recent revelations, check your pulse to make sure you are still amongst the living.

Happily, signs of life are plentiful among Toronto Star readers:

Liberal Party fundraisers held family millions in offshore trust, Nov. 6

Coverage of the Paradise Papers’ celebrity tax evaders has tended to revolve around the potential illegality of their actions. For example: how “blind” the offshore trusts of Stephen Bronfman and Leo Kolber actually are. I imagine most Canadians could care less whether Bronfman’s $60-million, tax-free snowball is being managed from home or from offshore. The real issue is, why is it legal in the first place?

The answer, which these leaks are revealing, is that our federal leaders are so beholden to Canada’s richest men — their chief fundraisers — that substantive crackdowns on these schemes are being prorogued. [Emphasis added]

These tax evasions are a spit in the eye to the Liberals’ fabled “middle class,” let alone to the 12 million Canadians who collectively own less than our richest 100 families.

Jeremy Withers, PhD student, University of Toronto

Thank you again for enlightening us on the machinations of the 1 per cent to avoid paying their fair share of taxes. An outstanding editorial. Surely, I am not the only one thinking of voting for the NDP in the next federal election.

Norma Martinez, Toronto

One of the main reasons for U.S. President Donald Trump’s victory was the snail-pace change to the status quo. People are fed up with the failure of governments to act. Whether the Paradise Papers news is based on legal or illegal actions of wealthy people or organizations is irrelevant. We must find ways to finance the needs of the populace and it is evident that this must come from those who have. Unless the current government acts decisively to outlaw these types of actions, Canadians, too, will either not vote or seek alternative populist methods. Justin Trudeau, be warned. [Emphasis added]

Harry Coupland, Etobicoke

This four-page article about offshore tax havens proves the point of American billionaire hotelier Leona Helmsley, who famously said: “We don’t pay taxes; only the little people pay taxes.”

It seems that democracy is on sale. The rich families finance politicians to fight elections and, as a quid pro quo, politicians protect their wealth through favourable legislation.

The article shows how Leo Kolber, a wealthy man who had accounts in offshore money centres, was appointed senator and then became chairman of the Senate’s powerful banking committee. He held back proposed unfavourable legislation on offshore trusts for 14 years.

These multimillionaires are not paying their share of taxes, forcing government to cut back on social services, health care, education, affordable housing, etc. It is estimated that the Canadian government is losing $6 to $8 billion per year in tax revenue. [Emphasis added]

Is it too difficult to force countries like Panama and British protectorates like Grand Cayman, Isle of Man and the British Virgin Islands to stop hiding money for wealthy Canadians.

Anis Zuberi, Mississauga

It is in the public’s interest to take tax avoidance seriously because we now know this is not a one-shot deal carried out by the odd, cunning billionaire, but rather a widespread scheme common among the wealthy.

We can no longer consider tax dodging and offshore accounts to be trivial, when everyone from the Queen to U.S. President Donald Trump’s cabinet are benefitting from them.

It is especially important for lower- and median-income households to care about this epidemic because it is they who suffer from the increased taxation and lack of public funding caused by the millions lost in tax revenue from offshore holdings. [Emphasis added]

It is the vulnerable and the poor who get the short end after this game is played out and it is time they force this issue into the public sphere and demand it be made a talking point.

Benjamin Rawlings, Ottawa

In Praise Of Critical Thinking

Here are five resources that can aid us in what really is a life-long journey:

The Point Is

In her latest iPolitics article, Kady O'Maley offers the view that the revelations of The Paradise Papers do not constitute a scandal for Justin Trudeau and his government. And while the Scheer-led Opposition is making every predictable effort to connect non-existent dots, few are suggesting that Trudeau had any personal knowledge of the alleged offences committed by chief fundraiser Stephen Bronfman, who has stoutly denied any wrongdoing.

However, to assert Trudeau's blamelessness in all of this is to look only at the immediate situation, one that Justin undoubtedly made worse with his unseemly and ready acceptance of Bronfman's innocence, about which I posted last evening. The larger implications of the ease with which the ultra rich transfer their money to jurisdictions beyond the reach of the tax man constitute the real threat to our democracy and our way of life.

Recently, I wrote this:

The revelations now in the public arena thanks to the collective efforts of hardworking journalists reinforce a perception that many, many people have held for a long time: the tax system is gamed, and talk of tax fairness is simply convenient posturing that ultimately means nothing. This perception/reality is very damaging to public morale; those who believe in paying their taxes are now being shown that they are, in fact, the patsies for their betters.

Nothing could be worse for those who believe in a society where all of us pay to maintain a social safety net, programs to help the disadvantaged, and a public medical system where no one is turned away because their wallet is too thin. Just more fodder for the rabid right wing, and governments have no one but themselves to blame.

It is a sentiment recently echoed by Thomas Walkom:

... tax havens have proved so embarrassing that they put the entire government revenue-raising machine at risk.

The cost to Canada’s federal treasury of offshore tax havens is estimated at between $6 billion and $8 billion a year. While that may seem a lot of money, when compared to the roughly $300 billion that Ottawa pulls in each year, it is relatively small.

Most tax revenue comes from the broad middle-classes — people who are willing to pay as long as they deem the system fair. Revelations, like those in the Paradise Papers, which detail at an individual level how the wealthy and well-connected get special treatment, break that trust. This threatens the entire fiscal basis of the state.

Put succinctly, no one wants to be played for a fool. And it is that fact that makes the cossetting of the utra rich by governments so dangerous.

In its editorial today, The Star offers this:

The latest revelations from the leak of the Paradise Papers raise troubling questions, not only about government’s failure to collect what’s owed, but also about the power of money to subvert our democracy.

They serve as a reminder that those who can afford to hide income from the taxman can also afford to hire the very best lobbyists to help ensure that, whatever the public interest, governments don’t close the loopholes that allow tax avoiders to get away with it.

There is, of course, a solution to all of this, one that I am not holding my breath waiting for:

The Paradise Papers are doing nothing to soothe those who worry about the unseemly intertwining of money and power in politics or about the extent to which the economy is rigged by the few against the many. The government can do something about that. It can, for instance, close unfair and ineffective tax loopholes and collect what’s owed. Or it can sit back, defend the current arrangements and watch the cynicism grow.

It would be nice to believe that The Paradise Papers will lance the massive carbuncle of complicity that exists between government and business, but like its predecessor, The Panama Papers, it will likely last only for a few more news cycles before being replaced by a feat of political legerdemain that suggests we just move along, as there is nothing to see here.

Not Good Enough

PM Justin Trudeau says he's satisfied with Liberal fundraiser Stephen Bronfman's explanation of his ties to offshore accounts, but Conservative Leader Andrew Scheer calls those remarks inappropriate.

The Prime Minister is either tone deaf, intellectually challenged, or truly and inextricably linked to the values represented by the world of the Bronfmans that he can so facilely accept the reassurance of scion Stephen that everything is above board.

Surely the Conservative Opposition, which I loathe, has a valid point here:


Nothing to see here, indeed.

A Change Of Pace

With all of the tawdry tales of corruption, tax avoidance and tax evasion going on right now thanks to the Paradise Papers, I feel like lightening the mood a bit. I hope you enjoy these, especially if you have ever been fortunate enough to share companionship with a dog: