I know many conscious Canadians often lose sight of the trees while keeping their views on the forrest as a whole... and for that reason, I wrote up a few quick summaries of recent very important Canadian developments reported in the National Post, Globe and Mail, and Fraser Institute monthly which it will do well to be aware of. I'm not yet certain what connection these huge intentions play with Harper's stopping Parliament until May 3, but I'm sure they are not disconnected. I will be putting together a more extensive report in the coming weeks.
THE CANADIAN FIRE SALE
The Globe and Mail has featured several major pieces this week featuring major dismantling at the remaining foundations of Canadian sovereignty. Primarily: the Pension crisis, Selling off of public works, and health care... The logic being hinged always upon the increasing deficit which rates at 24.7 billion in Ontario, and the Federal deficit is 50-60 billion (and TD report said next year would be 90 billion)-VERIFY. These reports are extra important because they destroy the mythology which most canadians have been sold by the media (Canada is in great financial shape- it's everyone else who have problems).
The means at which emergency revenues are being proposed currently:
1-Firesale of Crown Corporations.
2-Firesale of Nuclear Reactor Technology
3-Privatization of Pensions
4-Health Care Cuts (only Fraser institute reference so far)
Players: Ontario PM Dalton McGuinty, Ontario Finance Minister Dwight Duncan
Revenue is being proposed by selling off the major Ontario Crown Corporations, in One of 2 ways:
1- In piecemeal form, bit by bit or
2- by lumping them all together as a super-corporation and selling that
Dwight Duncan recommends that consolidation all into a parent corporation and selling a 20% private stake, whereby the government will still have a controlling hand... which is of course bullshit. The Globe and Mail reports that the Investment bankers HE hired say that this option would be unexceptable as it is a weak stock market valuation, and that private investors will only put money in something where the government is not in the drivers' seat (its all or nothing it seems).
McGuinty: "We've got a responsibility to take a look at all of our assets to make sure that we're getting the best bang for the buck, and especially now in the context of a global recession and a significant deficit"
Ontario Crown Jewels being pushed for sale:
Ontario Power Generation- supplies electricity province wide
$6.4 billion revenue- 2008
$88 million profit- 2008
Ontario Lottery and Gaming Corp- Runs casinos, and lotteries
$6.1 billion revenues- 2008
$1.7 billion profit
Hydro One-province wide power transmission
$4.6 billion revenue 2008
$498 million profit 2008
Liquor Control Board- Monopoly on sale of spirits and wine
$4.3 billion revenue 2008
$1.4 billion profit 2008
The two Investment banks were hired by Ontario Government to study the sales:
A: CIBC World Markets and Goldman Sachs
**Get a list and mini bio of the past crown corporations sold (ie: Air Canada, Petro Canada, Teleglobe)
Two Competing buyers:
OMERS, and OTPP
"Who knows what the process will be, but obviously OMERS will certainly look at the assets for sure," says Paul Renaud, president and chief executive of OMERS Private Equity.
"It's on our home soil, and our home province, and the quality of the assets, the size of the assets are unique. For an investor with a long term asset like teachers this is a good fit."-Erol Uzumeri, head of Teachers' Private Capital, (the private equity arm of the OTPP)
Who is against this shit (potential allies):
AGAINST: Rod Sheppard, president of the Society of Energy Professionals
ON SELLING CANDU TECHNOLOGY:
Is Harper pro-Nuclear as everyone seems to think? Well, he's tryin hard to sell it to foreign buyers... what does that tell you?
Harper confirmed he is calling for bids on the reactor wing of Atomic Energy fo Canada Ltd. Experts fear that this will leave the country "They're going to be selling Canadian know-how and intellectual property to a foreign bidder at bargain basement prices"- Geoff Regan, Halifax Liberal MP, "We're concerned that this is effectifely Canada's new Avro Arrow".
Globe and Mail article by Robert Carrick: Higher Taxes or Fewer Services: Something's got to give
DBRS Ltd Health Care costs represent 30-40% of provincial budgets, and costs rise between 5-7% annually. This is accompanied by the Frasier Institute report on Health Care reform I had read recently...
"Given tax increases would certainly hinder the province's economic recovery, Ontarians should instead begin contemplating reductions in government spending. And there's no better place to start than health care."
The article goes on to suggest bringing in partial-private insurance (since people wont overuse scarce medical resources when they pay for it themselves).
Then it suggests cutting funding to clinics, and setting up a 'pay per client' basis, which will devastate all smaller hospitals and clinics who dont get a ton of patients. They say this should allow for more "competition"... ie: the walmart logic to eat up "uncompetitive" small businesses in any area a behemoth is installed.
It ends with a final note: "But those reductions in spending need not reduce the quality of public services. Indeed, the level of misallocated and wasted resources in health care is high enought to allow the province to substantially reduce spending through sensible health care reform while actually improving access to health care."
Finance Minister Jim Flaherty says he'll leave "all options" for pension reform at the Whitehorse meeting. The main object being discussed is a "supplementary private pension plan" system, over and above Canada-Quebec pension plans. BC and Alberta have apparently been blazing the path for this reform. HOW SO!
More on this soon.