Part One: Horse Sense & Government Nonsense

July 26, 2012 4:34 pm
mare-and-foal_0

Public-Private Partnerships Are Not Subsidies

The Ontario government’s decision to end the Slots at Racetracks Program has a detrimental effect for Ontario’s vibrant horseracing and equine industries.

THE COMEDIAN GROUCHO MARX ONCE COMMENTED that: “Politics is the art of looking for trouble, finding it everywhere, diagnosing it incorrectly and applying the wrong remedies.” That observation may well describe the Ontario government’s decision to abruptly end the Slots at Racetracks Program, a successful revenue-sharing program that has, for almost 15 years, mutually benefited the government, the horseracing and equine industries and many small towns in rural Ontario.

The vehicle for the Ontario government’s unexpected decision was its March 27, 2012 Budget when Finance Minister Dwight Duncan rose to his feet at Queen’s Park and unveiled the document entitled Strong Action for Ontario. It outlined how Premier Dalton McGuinty’s Liberal government would eliminate the province’s massive $15-billion deficit within the next five years. Ontario horsemen, jockeys, breeders, equine suppliers, black-smiths, saddlers, veterinarians and farmers had no warning that contained within the 332-page document was a proposed initiative named Modernizing the Ontario Lottery and Gaming Corporation (OLG), which would eliminate the Slots at Racetracks Program by March 31, 2013, threatening the sustainability of the industry and a large segment of Ontario’s agricultural industry that it supports.

Since its inception in 1998, the Slots at Racetracks Program earned Ontario roughly a billion dollars in revenue every single year.

Since its provincial government-initiated inception in 1975, the OLG has been the Crown corporation responsible for running Ontario’s gaming industry, ranging from the sale of lottery and bingo tickets to the oversight of Ontario’s many resort casinos. Betting on the horses has been a time-honoured practice in Ontario since before Confederation, but, with the introduction of the Slots Program in 1998, horseracing became more closely tied to the gaming industry. The Budget initiative’s plan to remove slot machines from racetracks will undoubtedly loosen those ties. But why would their removal deliver such a crippling blow to the horseracing and equine industry, the second largest sub-sector of Ontario’s agricultural economy? The answer can be found in first identifying why OLG and the Ontario government put slot machines at the racetracks in the first place and also how the program functioned for the past
14 years.

Under a revenue-sharing agreement, profits from slot machines located at the tracks were split among the government, the horseracing and equine industry and the rural municipalities where the slot machines were located. The government received 75 per cent of every dollar spent at a provincial track and the industry got 10 per cent for wages and employment purposes. An additional 10 per cent was distributed to the racetracks to augment the purses of prize money, to maintain the tracks and for renovations. The final 5 per cent went to the rural municipalities. The subtext of the initial implementation of the Slots at Racetracks Program reveals a financial olive branch offered to the horseracing industry and a calculated conclusion based on social perception.

In the 1990s, knowing that slot machines were a crucial source of revenue, the OLG and the government needed to find an appropriate venue to expand the use of slots beyond Ontario’s numerous pre-existing casino facilities. Social perception made this a difficult task, since many Ontarians were reluctant to have new gambling facilities anywhere near where they lived. The province’s racetracks soon came to be seen as the appropriate place for the excess slot machines. As Ian Russell – president of Canada’s largest equine supplier, Greenhawk Harness and Equestrian Supplies Inc. – explains, “[the] racetracks are already located in socially acceptable places for gambling to occur.” Ed McHale, who serves as director of the National Capital Region Harness Horse Association (NCRHHA), offers the Ottawa-area perspective on this same issue by noting that: “Nobody wanted the slots anywhere and they decided that the best place (because they had nowhere else to put them) was the racetracks.” Yet there was another reason that the province’s newly expanded slot facilities found what many thought would be a permanent home at the province’s racetracks: a compromise with the horseracing industry.

Anna Meyers, president of the Standardbred Breeders of Ontario Association, identifies the compromise offered to the racing industry by the OLG in 1998 by stating that “we knew with the introduction of slot machines at racetracks, there would be some cannibalization of the wagers placed on the horses involved in horseracing, but we also knew that the revenue-sharing element of the Slots at Racetracks Program could also raise a lot of money both for the horseracing industry and the province.”

Or, as John Macmillan, executive director of NCRHHA, puts it: “We thought we could play off of one another, allowing both horseracing (through bets placed on horses) and the slot machines to be profitable. We felt that it would even out, because whatever revenue the industry lost through reduced wagers placed on horses due to the presence of the slot machines would be offset by the share of revenue kept from the slot machines.” And, as the results demonstrate, these two competing forms of gambling were able to “play off of one another” for quite some time.

The Ontario government and OLG have attempted to rationalize their decision to end the Program on purely economic grounds.

Since its inception in 1998, the Slots at Racetracks Program earned Ontario roughly a billion dollars in revenue every single year, most of which was gladly accepted by the province to help pay for essential services. In fact, between 2001 and 2011, after OLG commissions and expenses were deducted, the program delivered over $9 billion in revenue to the province. Each year, hundreds of millions of dollars from the horseracing industry’s portion of the lucrative revenue-sharing agreement were reinvested in the horseracing community. In 2010 alone, the industry received $334 million from its share of the Slots Program. That $334 million was split down the middle between the horse owners, racers, trainers and breeders on the one hand, and the racetracks on the other hand.

However, the $334 million pales in comparison with the approximately $2.3 billion the industry spent in Ontario that same year. Most of the $2.3 billion was spent in rural communities, stimulating the local economy through the purchase of services like training and grooming or goods like saddles, trucks, trailers and gasoline. All of these essential goods and services, part of the cost of doing business in Ontario’s thriving horseracing and equine industry, provided additional tax revenue for Ontario. But with the delivery of the Ontario Budget on that cold day in March, and its passage on the first day of summer three months later, the fate of the Slots at Racetracks Program was officially sealed.

The Ontario government and OLG have attempted to rationalize their decision to end the Program on purely economic grounds. They maintain that it is a necessary first step in the modernization initiative which will promote economic efficiency in the province’s gaming industry and will help reduce the province’s unsustainably high deficit. However, the reasoning simply does not add up. On page 39 of the Ontario Budget, it is stated that the modernization initiative will further benefit the province since it “will create 2,300 net new jobs in the gaming industry and nearly 4,000 additional jobs in the hospitality and retail sector by 2017-18.” While this may seem positive, closer examination reveals that it requires a tradeoff that is less-than-beneficial for Ontario.

The Budget speaks of “public sector investment” that will be reduced while still allowing the province’s gaming industry to make more revenue “through shifting day-to-day operations of gaming sites and lottery distribution to private operations.” Is this realistic? Bear in mind that this “public-sector investment” of about $345 million between 2011 and 2012 (and the cumulative total of roughly $3.7 billion that made its way to the horseracing industry from 1998 to date) is not a “subsidy”, as Dwight Duncan has said in the past. It represents the horseracing industry’s portion of the revenue accumulated under the Slots at Racetracks Program, a revenue-sharing agreement, not a “subsidy.”

“There’s an absolute genuine possibility that there will not be horseracing in Ontario in two or three years from now,” says Sue Leslie.

Will the modernization initiative’s plan raise more revenue than is now being generated by the current revenue-sharing program when the revenue provided by the OLG’s lottery and bingo operations has remained largely stagnant and that generated from charity and resort casinos has declined? Nevertheless, OLG’s modernization initiative projects that by eliminating the Slots Program, its most profitable revenue stream, and by further developing gaming operations which have historically returned less revenue to OLG and the province, net revenues will increase by more than $500 million by 2015. OLG spokesman Tony Bitonti explained how this paradoxical situation could be plausible by claiming that: “At the moment, it may be true that the bulk of revenue in the gaming industry comes from slots, but the demographics are changing. More and more people are becoming interested in table games.” Maybe so, but the OLG’s own data seems to show that the resort and charity casinos that provide a cross-section of slot machines and table games continue to see their revenue decline.

Perhaps the answer can be found in the cautionary tale of Quebec’s experiment with revenue restructuring in its gaming industry which led to a nightmare scenario that could be repeated in Ontario — but at a higher risk of 55,000 jobs lost. In 2006, Quebec’s horseracing industry undertook a revenue-restructuring initiative that resulted in the total collapse of the province’s horseracing industry and a near-death experience for the province’s equine industry two years later. The plan was to privatize the horseracing industry by allowing a private sector company called Attractions Hippiques to install Video Lottery Terminals (VLTs) in restaurants and bars while removing many of the existing VLTs from the province’s tracks and restricting Off-Track Betting. These actions, coupled with mismanagement, led to an inability to generate sufficient revenue through diversification and the subsequent bankruptcy of Attractions Hippiques. The horseracing and equine industries disintegrated almost overnight. Today, there remains only about 13 per cent of the pre-2006 jobs in Quebec’s horseracing and breeding industry. While VLTs were found in 6 per cent of Quebec’s tracks, slot machines are now present at (but will shortly be removed from) 100 per cent of Ontario tracks. The stakes could hardly be higher or the fallout worse from the sudden removal of the slots, because 10 per cent of their revenue had been kept by each track under the Slots Program.

The OLG and Ontario government predict that the modernization initiative will increase job opportunities for the gaming and hospitality industries. This is an attempt to divert attention away from the fact that, by adding some 6,000 jobs in five or six years’ time, Ontario risks sacrificing its horseracing and equine industries, as well as their satellite industries which employ about 55,000 Ontarians in full-time, part-time and seasonal jobs. The government position is perplexing since the modernization initiative has already caused 560 layoffs when the slots operations in Sarnia, Windsor and Fort Erie were closed down in April.

When speaking about the direct implications of the McGuinty government’s sudden decision, Sue Leslie, who serves as the President of the Ontario Horse Racing Industry Association (OHRIA), the organization which is the voice of horse racing in the province, captured the urgency of the situation by stating that, “there’s an absolute genuine possibility that there will not be horse racing in Ontario in two or three years from now.” John Macmillan from the NCRHHA elaborates on the fallout of the government’s decision by noting that, “there has been almost no investment in horse racing in Ontario since the ending of the Slots at Racetracks Program was announced in March.”

Continued in Part Two: Horse Sense & Government Nonsense 

“Changing the Conversation”: Campaign Distractions on the Road to the White House

July 23, 2012 9:00 am
Don Draper

In an episode of Mad Men, the popular series set in the early 1960s, Madison Avenue advertising executive Don Draper offers this advice to a colleague: “If you don’t like what is being said, change the conversation.” This dictum is not limited to the realm of advertising.

Last week’s coverage of the American presidential campaign, shows that both Democrat and Republican political operatives are attempting to use the tactic to reframe the November election in a way which favors their candidate and diminishes his opponent. But one party appears to be doing a better job than the other in “changing the conversation.”

As election day approaches in a presidential contest which will likely be the most significant since the pivotal 1860 election (in terms of establishing the general trajectory of the country and what it means to be American). Both incumbent President Barack Obama and his Republican challenger Mitt Romney no longer appear to be running issues-based campaigns.

If Obama were to “change the conversation” of the campaign to divert attention away from both these issues and also from his past performance, he would have a better chance of winning a second term.

Here are the issues: America is saddled with an almost unrepayable deficit, an array of unsustainably expensive social welfare programs which are decades overdue for reform, an overly complicated 71,000 page tax code, a near-stagnant economy with a weakening job market and a looming budget crisis which, if unaddressed, will raise interest rates to crippling levels and trigger massive automatic spending cuts that will damage the nation’s credibility and the global economy. Instead of hearing both Romney and Obama discussing how to right these wrongs and how to restore the country’s competitive edge in the increasingly interconnected global economy, they have “changed the conversation.”

Obama has done so out of necessity. As the incumbent president, he wears the steady stream of bad economic news and likely knows that offering credible plans to address these crucial issues requires him to first acknowledge their existence. He therefore risks being portrayed by the media as a president who, throughout a four-year term of office, did not deal with these issues as America moved ever-faster towards the fiscal and socio-political cliff. If the election were to be a referendum on his performance on these issues and also on the ideological trajectory he implemented in those four years, he would undoubtedly lose the November 6th election. However, if he were to “change the conversation” of the campaign to divert attention away from both these issues and also from his past performance, he would have a better chance of winning a second term. The issue which has allowed him to do so has been Mitt Romney’s business record.

Romney has spent most of the week staying off-message and defending his private sector business record against virulent allegations by the Obama campaign that Romney’s tenure as the chief executive officer (CEO) of the private equity and venture capital firm Bain Capital in the 1990s resulted in countless hostile takeovers, the shuttering of many American businesses and the exporting of thousands of American jobs overseas. Furthermore, the Obama campaign accuses Romney of committing a felony, claiming that, for three years following his 1999 departure from Bain to serve as the CEO of the 2002 Salt Lake City Olympics, Romney still controlled Bain. Since Romney’s name appears on a variety of Securities and Exchange Commission (SEC) documents between 1999 and 2002, the Obama campaign claims that Romney was illegally operating Bain Capital after he had formally resigned. The Obama campaign ignores the fact that it is not unusual for the names of former executives to remain on SEC disclosure forms for a number of years as a company formally vets and brings the replacement CEO up-to-speed on the inner workings and complexities of the position he or she inherits. This process may have taken longer than usual at Bain Capital since Romney’s departure in 1999 occurred without much warning and other executives at Bain had little time to prepare the transition given Romney’s absence.

The Obama campaign accuses Romney of committing a felony, claiming that, for three years following his 1999 departure from Bain to serve as the CEO of the 2002 Salt Lake City Olympics, Romney still controlled Bain.

Furthermore, Romney has also been off-message for quite some time due to the controversy raised by his refusal to release a more extensive selection of his annual income tax returns. There may be a number of reasons why he has refused to release income tax returns that predate the legally required two years preceding the election date. One reason may be that they will reveal that he consistently made a substantial amount of money, thereby reinforcing Obama’s definition of Romney and the Republicans as the candidate and party of extreme wealth, out of touch with the majority of Americans. All accusations of class warfare aside, it is undeniably true that Romney’s estimated personal wealth of about $250 million marks him as a rich man, but it is important to remember that he is not the only wealthy man ever to have run for election in America.

President John F. Kennedy’s father, Joseph P. Kennedy Sr., served as the Chairman of the SEC despite the fact that he made a large portion of his fortune through insider trading and market manipulation tactics like “bear raiding” and “pumping and dumping” albeit before these tactics were technically illegal. He would eventually rise to the position of United States Ambassador to the United Kingdom in the final years before the Second World War. Between the 1920s and his death in 1969, Joseph Kennedy made roughly $500 million which he contributed to the family war chest. Adjusted for inflation, in today’s dollars, that $500 million would represent well over $3 billion. When his son John F. Kennedy won the presidency in 1960, there were no accusations that the Democrat was out of touch with the majority of Americans due to his family’s extreme personal wealth. It is worth noting that, even as early as 1935 during the height of the Great Depression, the Kennedys had a net worth of at least $180 million dollars, or $3 billion in today’s money, a sum which is approximately 11 times the net worth of Mitt Romney.

During the height of the Great Depression, the Kennedys had a net worth of at least $180 million dollars, or $3 billion in today’s money, a sum which is approximately 11 times the net worth of Mitt Romney.

Another reason Romney may be hesitating to release a more extensive array of tax returns could be that they would show that much of his annual income was accumulated through investments which carry far lower tax rates than does income tax in the USA. This could increase the criticism that he, and many wealthy individuals like him, pay tax rates which are disproportionately too low. That characterization would further hamper his ability to break free of the Obama campaign’s framing of him as being out of touch with ordinary Americans. Instead of skirting around these issues, Romney should take a page from Don Draper’s book and “change the conversation.”

To get his campaign back on track and back on message, Romney should release more annual tax returns and confront the Bain Capital accusations head on. He should address the lower tax rates he benefited from under the US Tax Code and also remind the American public about the large charitable donations he makes as a form of socially responsible compensation for his lower tax rates. For example, in 2010 alone, Romney gave 14% of his income to charity while two years before winning the presidency Obama donated 6.1% of his income. Obama’s future running mate, now Vice-President, Joe Biden only gave a paltry 0.15% of his 2006 income to charity. Romney should then change the conversation of his campaign to a discussion of how the Obama presidency has not lived up to confronting the challenges which could cripple the United States of America in the twenty-first century. He must then redefine himself as the man who offers a business-based approach in dealing with these challenges, in stark contrast to the community-organizing sitting president. The point should be made that rhetoric can no longer suffice and that appropriate, measured and tangible policies (which he, Romney, can offer) are what is needed for America to survive in the brave new globalized world.

Disabilities in Public Life

July 9, 2012 4:01 pm
President Kennedy in a rare 1961 photograph

Fifty-two years ago, in 1960, Massachusetts Senator John Fitzgerald Kennedy threw his hat into the ring as a presidential contender. In November of that same year, at the age of 43,  Kennedy would be elected as the United States of America’s 35th president thanks to a combination of his father’s wealth and political connections, his own oratorical skill as well as his ability to convince the American people that he could reform Washington. He would do so by implementing what he called the “New Frontier,” a modern and more accommodating foreign and domestic policy agenda which, amongst other things, sought to end partisan bickering and gridlock in Washington, to minimize poverty and to beat the USSR in the space race. In the eyes of many, the young, vigorous and photogenic president himself appeared to be the perfect man to steer America towards its New Frontier of progressivism. However, few Americans knew that behind the thin veneer of publicly-projected vigour was a man who was anything but healthy.

Jack Kennedy, as he liked to the called, suffered from debilitating back pain which resulted from injuries he sustained when his torpedo boat PT109 was rammed and sank during the Second World War. Between the end of the war and the beginning of his presidency, he underwent two serious back surgeries that nearly left him crippled. For the rest of his life, Kennedy would be in severe physical pain and would often require the use of crutches to move around the White House, not to mention daily dosages of medication to keep his chronic pain under control as he conducted the nation’s business. To make matters worse, he also spent his entire life battling Addison’s disease, a disease which severely lowers the ability of one’s immune system to fight off infection. But Americans were unaware of their president’s physical frailty since Kennedy refused to allow the press to photograph him on crutches for fear that, if the public knew that he was not the healthy man he projected, he would be rejected by the American people and seen as weak and vulnerable by America’s enemies.

President Roosevelt in one of the few known photographs that exposes his disability.

Kennedy was not the first president to hide his ailments from both the press and the public. Another Democrat, Franklin Delano Roosevelt, America’s only four-term president, spent the second half of his life paralyzed and wheelchair-bound from contracting polio at the age of thirty-nine. When Roosevelt ran for the presidency in 1932, he too took every measure possible to hide his disability from the American people fearing that they would not elect a president who could not walk. For instance, he wore special leg braces which allowed him to stand upright. He would arrive at the podium to deliver a speech well in advance of any spectators and would not move away from the podium until well after the last of the press and the audience had left the venue, thereby preventing the American public from seeing that he could not walk. In order to convince Americans that he was not disabled but healthy, Roosevelt drove a car in which the gas, brake and clutch pedals were secretly operated by hand levers hidden below the window line. And, of course, he too refused to allow the press to see him in his wheelchair or from any vantage point that revealed his leg braces. For the most part, like Kennedy, Roosevelt’s strategy worked. Very few pictures of him revealed his disability and, as the saying goes, the public cannot know what the press doesn’t see.

American presidents are not alone in going to great lengths to hide their health problems from the public in the fear that being handicapped or ill could translate into a political drawback on election day or an unfavorable perception in the court of public opinion. For instance, throughout the 1980s and 1990s, Diana, the late Princess of Wales, suffered from manic-depressive disorder, anorexia and bulimia. It is alleged that she cut herself numerous times and flirted with suicide on several occasions. Yet, aside from her admitting publicly that she had suffered from “eating disorders” in the past, very few knew that the Princess had many more serious psychological problems. The Royal Family made every effort to prevent this information from becoming public knowledge and it remained confidential for more than a decade after her death in 1997.

American First Ladies have also hidden their illnesses and disabilities from the public for fear their health problems would reflect poorly upon the approval ratings of the president. For instance, Ida McKinley, the wife of Republican William McKinley, who served as the President of the United States at the turn of the twentieth-century, suffered from epilepsy. She was rarely photographed candidly and, when she had a seizure, the president would quickly cover his wife’s face with his handkerchief in an effort to hide the effects of her seizure from any witnesses but also to calm her down since, in her case, darkness helped to alleviate the symptoms of the seizure. But if Republican presidential challenger Mitt Romney wins this November’s presidential election, the historical pattern of public figures and their spouses hiding their disabilities or illnesses will be over.

Ann Romney has broken with tradition by refusing to hide her health problems from the public.

Ann Romney has broken with tradition by refusing to hide her health problems from the public. Fourteen years ago, she was diagnosed with Multiple Sclerosis (MS), a disease that strikes close to half a million Americans and which wages war on the body’s immune system and erodes the protective covering of nerve bundles in the spinal cord. It is a disease which can be treated but not cured. Multiple Sclerosis leads to extreme pain, muscular rigidity, severe exhaustion and possibly paralysis. While on the campaign trail with her husband, in a number of high-profile interviews with leading American newspapers like the Wall Street Journal and USA Today, Ann Romney recently openly discussed her struggle with MS and how the disease has affected her life. She is adamant about eliminating the taboo that disabilities still carry in political life — albeit now to a much lesser degree than in the era of both Franklin Delano Roosevelt and John Fitzgerald Kennedy. Times have changed and, today, ordinary citizens living with a disability or chronic disease no longer always seek to hide that reality under a cloak of false normalcy. Why should it be any different for a public figure?

Welcome to Rowdy Beach! Bay of Constance Sorrow: Frustrated Residents, Powerless Police and Drunks on the Beach

July 3, 2012 4:00 pm
Constance Bay 8

John Nightingale’s hands shake as he grabs his cell phone from the lawn table. Drops of sweat appear on his forehead. Nightingale dials the police and reports that he was threatened by drunks on his property when he asked them to put their dogs on a leash.

The temperature is sky-high, and so is the tension at Constance Bay’s Point Beach.

It is not even June, and yet dozens of visitors occupy the beach. Loud music erupts from one of the boats nearby. Even though there are “No Stopping, No Alcohol, No Walking after Sunset” signs posted beside every property, young people amble about with beers in their hands. A bottle of Smirnoff Vodka is the favoured beverage of another group of teenagers.

Even though there are “No Stopping, No Alcohol, No Walking after Sunset” signs posted beside every property, young people amble about with beers in their hands.

Point Beach is privately owned. Underaged youth freely consume alcohol, smoke, litter and party like it’s 1999. Dogs run free off their leashes. “Effing” is a word often heard here.

The main reason this situation is allowed to continue is the inability of beach owners, the president of the Constance and Buckham’s Bay Community Association (CBBCA), the West Carleton-March city councillor Eli El-Chantiry and the Ottawa Police Service to deal with the deplorable state of affairs that has been ongoing at Point Beach for years. Instead, all sides are just pointing fingers at each other.

While waiting for the police to arrive, Nightingale explains: “It’s nerves.” He is angry that he and his neighbours must deal with drunken parties for yet another summer.

Nightingale’s cottage is just a few meters away from the bank of the Ottawa River. Eight other neighbours own a beach strip to the water’s edge. In the city subdivision, their property is designated as Plan 412.

In 1862, the Crown granted these residents a land patent; a notation to the plan says the property extends to the shoreline. In 1984, West Carleton Township confirmed that it is indeed a private property. As questions were raised about the boundaries of the ownership, the police force sought a legal opinion. In 2010, the City solicitor concluded that property of Plan 412 extends to the water’s edge at low mark.

John Nightingale, 54, is the youngest among other retired residents. He became a leader and a representative of his neighbours in their plight to convince the police, the city and the community to enforce bylaws.

Joyce Nightingale joined forces with her neighbour John by agreeing to talk to Ottawa Life, though both residents confess they have lost faith in local media. Many articles have been written about this situation, but little action has been taken.

“This is a rowdy beach. This is where crap happens.”

When people from the city realized that the beach was private and free of oversight, they began advertising through Facebook and Twitter that it was a “beach without rules.”

In the past, they shared their beach with community residents. But, when people from the city realized that the beach was private and free of oversight, they began advertising through Facebook and Twitter that it was a “beach without rules.”

Elderly couples and young families have started avoiding the place, preferring to go to other public beaches on Constance Bay. On one hot day, the owners counted as many as 600 people – far beyond Point Beach’s capacity.

As we spoke, the music drowned out our conversation. Asked how they can tolerate such loud noise, both neighbours laughed bitterly.

“That music is nothing – you should hear it when it gets really loud!” Sometimes, John Nightingale says, the music is so loud that his cottage shakes.

“Boom! Boom!,” Joyce Nightingale imitates. “It’s wild! We are not exaggerating! It’s just nuts!”

Joyce Nightingale gave up approaching the partygoers, asking them to turn the music down. She says it makes her “very upset” when young people under the influence of alcohol become aggressive and rude. Once she approached a drunk, and his response was: “See this? It’s sand, you bitch. Get in your house and leave us alone.” Another time, Joyce says, she asked wayward youth to take their empty beer and liquor bottles home. She faced a middle finger; bottles were left there, stuck in the sand.

It doesn’t end with verbal abuse and threats, says John Nightingale. Some people will occupy his driveway, and while passing through his yard, grab his lawn chairs.

John Nightingale says the police officers don’t always respond in a timely manner.

John Nightingale says the police officers don’t always respond in a timely manner. Last June, he made a call at 4:15 p.m. when he saw a drunken trespasser’s dog chasing a neighbour’s cat. Next morning, the neighbour across the street said she saw a police car arrive after 10 p.m. It pulled into John Nightingale’s driveway, remained there for five minutes and left. Nightingale was surprised that the officer didn’t even knock on his door because he was still waiting; his lights were still on.

Police: “We are pawns here.”

This time, Constable Kevin Myers and Constable Mark Lystiuk arrived in 45 minutes.

Cst. Myers kept asking what John Nightingale wanted him to do. Nightingale said he wants drunks removed from the beach, and even though it is a private beach, the young folk are welcome to use it if they bring no alcohol.

“John, here is the thing. Now, you know, you got the letter from the chief last year, right?,” asked Cst. Myers. “We are pawns here, okay? We are stuck in the middle. We are doing what the chief wrote in that letter.”

The letter was written by Ottawa’s former police chief Vern White in June 2010.

White acknowledges that the beach is privately owned. So, the police can’t enforce section 31 (2) of the Liquor Licence Act, which states: “No person shall have or consume liquor in any place other than a private place as defined in the regulations.” The police can’t issue trespassing tickets either, because the property boundaries are unmarked.

The police explain, to enforce the Trespass to Property Act, residents must mark, delineate, and fence out each property lot.

The police explain, to enforce the Trespass to Property Act, residents must mark, delineate, and fence out each property lot. Otherwise, the police say, it will be hard to take any measures. The police also advise beach owners to hire a private security guard. The residents of Plan 412 don’t think they should have to abide by these requirements.

Cst. Myers said police officers can just go talk to people, but if a criminal act should occur, they will return to the site.

It took almost an hour before Cst. Myers addressed the crowd. By that time, young people, seeing the arrival of the police, hid their alcohol supply and jumped into their boats. Those who didn’t have a boat left the beach. The crowd dwindled to six people on the beach, playing volleyball – six sober individuals who were just having a good time.

Cst. Marc Soucy, media person for newly appointed Ottawa Police Chief Charles Bordeleau, confirmed that Vern White’s letter is still valid, unless the residents are willing to challenge it in Ontario Superior Court.

Doomed Agreement

Last year, Plan 412 residents decided to license a portion of their beach property to the City for the symbolic fee of $10 a month. In return, the City would enforce bylaws. The residents spent $2,500 to write the agreement. But the CBBCA turned down the proposal. The owners indicated they want to limit the overflow of people by making Point Beach a community-only beach. This was the demand that derailed the reaching of an agreement, according to Ian Glen, president of the CBBCA.

City councillor Eli El-Chantiry, who also chairs the Ottawa Police Services Board, was involved in the agreement talks. The beach owners are still frustrated that El-Chantiry – quoted in a 2008 article in the Ottawa Sun – promoted Constance Bay as a “secret jewel”, attracting even more attention and more people.

According to Nightingale, El-Chantiry approved construction of a parking lot close to the beach and the installation of public toilets. A green sign with the CBBCA’s logo was erected near the beach entrance; the sign reads: “Not a City of Ottawa Beach. Use at Own Risk and Liability. Respect Our Community. No Glass. No Alcohol. Remove Garbage. Keep Animals Under Control. Poop and Scoop. No Unauthorized Fires. No Unauthorized Vehicles” – all these rules were disregarded on the afternoon I visited the beach.

Ottawa Life tried to reach El-Chantiry several times by telephone and email, but calls were not returned and email messages weren’t acknowledged. At one point, El-Chantiry set up a time to discuss the matter and then did not show up for the call.

Joyce Nightingale never imagined that in her retirement years, she would have to wear rubber gloves and pick up broken bottles. She has been coming to her cottage every summer for 77 years – but she doesn’t want to anymore.

“I wanted to be here until I die, but I just don’t think I will be able to hang in there. I mean it upsets me so badly. You can’t even come out and read a book. If you go to the city beach, none of this would happen.”

After spending one afternoon with the residents – seeing first-hand what these people go through on a daily basis – you can’t help but wonder why the city, community and residents are so reluctant to compromise and, at last, come to a resolution.

Why can’t they all get along?

That’s a good question and one that deserves to be answered. However, it would appear the residents can’t count on any leadership from their (West Carleton-March city) councillor Eli El-Chantiry, who has ignored the matter and the interests of the residents he is supposed to be representing at City Hall. What makes El-Chantiry’s stance doubly vexing is that he also chairs the Ottawa Police Services Board, making him ideally suited to hammer out a deal between the police, the beach infiltrators and beachfront property owners. So far El-Chantiry has done nothing, adding to his list of underwhelming achievements as both a city councillor and as chair of the impotent and irrelevant Ottawa Police Services Board, a toothless paper tiger with no real authority, power or influence in the city. So residents will continue to suffer.

As private property owners, they have the right to build fences down to the waterline, forbidding the beach to outsiders, but when city lawyers floated this suggestion to residents, they refused to even consider the idea.

The Ottawa police constables are doing the best they can to deal with the sticky situation at Point Beach, but as they must cope with limited budgets, resources and manpower, they cannot be expected to patrol the beach on a regular schedule to prevent young people from gathering to drink beer or smoke the ganja weed or spout cuss words and behave poorly.

However, the residents themselves must take a measure of the blame for this sad state of affairs. As private property owners, they have the right to build fences down to the waterline, forbidding the beach to outsiders, but when city lawyers floated this suggestion to residents, they refused to even consider the idea. So for want of a nail and a few fences that would make good neighbours and restore harmony to Constance Bay, the conflict is likely to persist at Point Beach during the good weather months for many years to come.

A Presidential Election Campaign Heats up as America’s Economy Cools Down

June 6, 2012 5:02 pm
US President Barack Obama receiving bad news in the Oval Office

After months of campaigning and mudslinging, the Republican primary race is over. Former Massachusetts Governor Mitt Romney will challenge the incumbent President of the United States of America, Democrat Barack Obama, in this November’s presidential election. Romney’s decisive win in last week’s Texas Republican primary pushed him above the 1,144 delegates required to win his party’s nomination. Yet, well before last week’s primary, and its subsequent solidification of Romney as the GOP nominee, both the Romney and Obama campaign machines were already fully engaged in general election mode. It comes as no surprise since the stakes could not be much higher than they already are.

This is especially true for the incumbent president due to the negative economic data released at the end of last week. In

A trader reacts to the bad news on the floor of the New York Stock Exchange (NYSE).

the month of May, American stock indexes experienced their worst monthly returns in two years. The Dow Jones Industrial Average lost 6.2% while the Nasdaq declined by a more troubling 7.2%. As bad as these numbers are, even worse for an incumbent president of any party is the unemployment data which, to make a rather modest understatement, is not working in Obama’s — or, for that matter, his party’s — favor. In a country of roughly 314 million people, the American economy created a mere 69,000 jobs in May which is the worst job growth number in a year. To make matters worse for Obama, based on these figures, the national unemployment rate will increase from 8.1% to 8.2%. That rising 8.2% unemployment rate is a rather conservative estimate since the actual unemployment number which includes those who have given up looking for work is well into the double digits. Similarly, the number of Americans who have been unemployed for more than half a year is also on the rise. In fact, the number of long-term unemployed Americans rose by 300,000 in the month of May, jumping from 5.1 to 5.4 million individuals. This category of long-term unemployed accounts for close to half of all the unemployment in America. Given the negative numbers, it is clearly not yet “morning in America” nor, should trends continue, will it be “morning in America” by election day on the first Tuesday in November.

President Obama faces an uphill battle to win re-election in light of such anemic economic numbers. In fact, no president in more than seventy years has won a second term with unemployment above 7.2%. Democrat Franklin Delano Roosevelt was the last man to return to the White House with unemployment rates above this threshold back in 1936, a time when a gallon of gasoline cost about 10 cents and the average single family home sold for less than $7,000. Also, recent opinion polls are reflecting the president’s precarious position. He is locked in a dead-heat with Mitt Romney six months before election day, a time when most incumbent presidents benefit from double digit leads over almost any challenger whether Democrat or Republican. In other words, due to the worsening economy at home and the economic woes of the European Union, Obama may well not enjoy the many benefits that normally fall to an incumbent president.

Republican presidential candidate Mitt Romney

This is good news for Romney who, prior to serving as the Governor of Massachusetts, worked as a successful businessman and private equity manager. Romney has built his campaign platform on the premise that the best way for the American economy to enter a sustained recovery and for America to prosper is for it to be governed by someone familiar with the inner workings of the private sector. Romney is presenting himself to American voters as the candidate who has a successful track record of creating wealth and boosting employment rather than someone who was involved in community organizing, writing memoirs and teaching law at America’s Ivy League universities. Today, this message seems to be resonating with many Americans. When respondents are polled about who could do a better job turning the American economy around, Romney consistently beats Obama by a healthy margin. However, Romney’s apparent disconnect with many American voters, as well as the Tea Party’s lukewarm perception of his less stringent conservative values (based upon his past positions on various socially-charged issues from abortion to climate change), continue to be the political albatross that hangs around Romney’s neck preventing him from gaining further popularity with many Americans. In contrast, Americans prefer Obama over Romney when it comes to personality.

Personality aside, most American elections are won or lost on economic grounds. In a television advertisement aired during the 1980 presidential election, then Republican candidate and former California Governor Ronald Reagan asked a question that will likely drive this November’s election. Speaking from behind a podium, Reagan asked the American people, “Are you better off than you were four years ago?” In 1980, America was stuck in a deep recession and the stagnant economic policies of Democrat President Jimmy Carter were the catalyst for a landslide victory for Reagan and his party. Reagan advocated that the best way for the United States to regain its economic might was to elect a government which was run using the same tools as those used to successfully run a private sector company — the private sector being an environment in which government regulations, mandates and other forms of intervention generally slow economic growth.

Thirty-one years later, America is again unable to move out of a lingering recession. While the 2008 recession did begin with a Republican in the White House, the fact of the matter is that today there are still some five million fewer jobs in the American economy than there were before September 2008 and any president — whether Republican or Democrat — will face the American public’s anger given such a negative trend. Consequently, the race for the White House will be run on a state-by-state basis where both candidates will attempt to frame themselves and their parties as being best able to fix America’s ailing economy whilst still broadcasting a message of national unity. Yet, some states will likely be given more weight than others by both the incumbent president and his Republican challenger. These “battleground” or “swing” states such as Indiana, North Carolina, Virginia, Florida, Ohio, New Hampshire, Pennsylvania and Wisconsin could very well determine whether or not the president will continue to enjoy public housing in the White House for four more years or if Romney will move from Massachusetts to Washington D.C.

Given the importance of those eight states, not to mention that of the other forty-two, both candidates will likely have to perfect the art of “retail campaigning” in which politicians personally solicit votes from the public by shaking as many hands, attending as many town hall meetings and stopping at as many truck stops and coffee shops as possible. They will do so for two very different reasons: Obama, the incumbent, will have to try to distract voters from America’s lack of economic recovery while Romney, the challenger, will have to prove more attractive to average Americans.

 

 

Business Profile: Winning at the Carney-val

May 28, 2012 4:23 pm
Pg32_Carney_Flaherty_byQuameScott

By: Dan Donovan and Harvey Chartrand

Bank of Canada Governor Mark Carney was called a “hot commodity” by Postmedia News in April. Carney, 47, has been credited with shielding Canada from the worst effects of the 2008 global financial meltdown, when the United States’ and Europe’s financial systems nearly collapsed. At the time, Carney was the untested wunderkind at the Bank of Canada who had replaced the highly respected David Dodge, a revered giant with professionals in the Canadian banking and investment world. By 2009, Carney’s response to the financial meltdown had earned him recognition by the Financial Times and TIME magazine as a superstar in the world of high finance.

By 2012, Carney had enough respect from international governments that he was selected to chair the powerful Financial Stability Board, an institution of the G-20 major economies based in Basel, Switzerland charged with co-coordinating the overhaul of international banking regulations. (While there has been no indication of Carney’s priorities as chairman, on the day of his appointment, the Board published a list of 29 banks that were considered large enough to pose a risk to the global economy in the event that they failed). In April 2012, a rumour circulated that the British Cabinet was interested in naming Carney as its Governor. Carney put an end to that rumour by stating that he was staying at the Bank of Canada, reassuring Canadian banks it was business as usual.

Mark Carney worked his way up the ranks of Goldman Sachs, the Department of Finance Canada, and the Bank of Canada, as deputy governor. Armed with his great pedigree and understanding of the complex international finance system, combined with his experience at Finance under David Dodge, Carney was able to devise a strategy to allow Canada to navigate through the worst tremors of the crisis. Most importantly, he set in motion a plan to protect Canada from the delayed financial aftershock that is now undermining many First World nations and threatening the once overheated economy of China, which Canada is increasingly reliant upon as an export market.

By 2009, Carney’s response to the financial meltdown had earned him recognition by the Financial Times and TIME magazine as a superstar in the world of high finance.

Part of this strategy was recently uncovered. In a study  released  on April 30 by the Canadian Centre for Policy Alternatives (CCPA) titled The Big Banks’ Big Secret: Estimating Government Support for Canadian Banks during the Financial Crisis, the previously secret extent of  the extraordinary support required by Canada’s banks during the 2008-2010 financial crisis was revealed. For much of the past three years, Canadian banks were touted by Federal Finance Minister Jim Flaherty, the federal government—and the banks themselves—as being much more stable than other countries’ big banks. Canadians were assured that our banks needed no bailout and, because of their management and lending practices, were the most secure banks in the world. The CCPA’s latest study suggests that this was not the case.

According to the study by CCPA senior economist David Macdonald, support for Canadian banks reached $114 billion at its peak.

“At some point during the crisis, three of Canada’s banks—CIBC, BMO and Scotiabank—were completely underwater, with government support exceeding the market value of the company,” says Macdonald. “Without government supports to fall back on, Canadian banks would have been in serious trouble.”

Between October 2008 and July 2010, Canada’s largest banks relied heavily on financial aid programs provided by the Bank of Canada, the Canada Mortgage and Housing Corporation (CMHC) and the U.S. Federal Reserve—all at the same time. The study estimates the value of government support by combing through data provided by CMHC, the Office of the Superintendent of Financial Institutions and the Bank of Canada, as well as quarterly reports of the banks themselves. Carney might call it “liquidity support” but Macdonald says it was a bailout. “Whatever you call it, Canadian government aid to the tune of $114 billion for the country’s biggest banks was far more indispensable than the official line would suggest.”

Because of this necessary but secret infusion of multi-billion-dollar loans, no Canadian banks failed – as opposed to 400 U.S. banks that did – the loans to Canadian banks were quickly repaid. The Government of Canada even made a $2.5-billion profit on the bank loans, according to CBC Ottawa. Ironically, over the entire aid period, Canada’s banks reported $27 billion in total profits between them, and the CEOs of each of the big banks were among the highest-paid Canadian CEOs. Between 2008 and 2009, each bank CEO received an average raise in total compensation of 19 per cent. There is a serious ethical question related to why the CEOs of the CIBC, BMO and Scotiabank paid themselves so handsomely when their banks were so stretched. That is quite a contrast to Carney, who left behind millions of dollars in salary when he quit Goldman Sachs to take up public service. He believes policy can make a difference. And he has made a difference. The reality is that the strategy Carney put in place for those types of loans to be accessed by Canadian banks worked and everyone, including taxpayers, came out on the winning side. Internationally, Carney was seen as the smart go-to guy on how to fix the international banking system.

Carney’s biggest worry is the explosive growth in household debt.

Prior to being selected to chair the Financial Stability Board, Carney showed some good old Canadian grit. It became clear that he could not only take a punch but deliver one as well. At a September 2011 meeting of some of the world’s most influential bankers, Jamie Dimon, head of JPMorgan Chase & Co, directed a tirade at Carney during a private gathering of the world’s most influential bankers in Washington, D.C. Carney was the lead in presenting the efforts by the Group of 20 major economies to overhaul an international regulatory regime that was exposed as weak by the financial crisis. Carney was pushing for an international policy makeover to reshape global financial regulation. Dimon opposed this.

The confrontation occurred when Dimon attacked a plan backed by Carney that would require a few dozen lenders (including JP Morgan) to hold reserves at levels 2.5 percentage points higher than other banks – a measure inspired by the economic destruction caused by the collapse of Lehman Brothers Holdings Inc. After listening to a tirade from Dimon, including the suggestion that his proposals were anti-American, Carney pushed back with a cogent and firm defence of the G-20’s efforts to construct a regulatory regime that will significantly reduce the risk of another global financial crisis. It was a dressing down of significant proportions.

Three weeks later, when the Occupy Wall Street (OWS) demonstrations and other expressions of frustration with the global economic and financial system highlighted the need for policymakers to show they are serious about forcing change, Carney commented  that the movement was an understandable result of the “increase in inequality” – particularly in the United States – that started with globalization. “You’ve had a big increase in the ratio of CEO earnings to workers on the shop floor and then on top of that, a financial crisis. There’s a frustration with policy and a frustration that, ‘are things going back to business as usual?’  If I may say, that is not going to happen, but I can understand the frustrations.’’

Carney then added that it was his view that the OWS protests are a “democratic expression of views”’ and “entirely constructive.” A few months later, Carney was named Chairman of the Financial Stability Board. Clearly, he was not one to be cajoled or pushed around.

Canada has by no means emerged unscathed from the global financial turmoil. Carney’s biggest worry is the explosive growth in household debt.

His concern follows the release on April 18 of the Bank of Canada’s latest monetary policy report – a quarterly economic overview compiled by the central bank. The report highlights the exponential growth of home equity lines of credit (HELOCs) and mortgage refinancing in the past decade, which have surged to $64 billion as of 2010 from $8 billion in 2001. Since the Bank of Canada sets the interest rate that determines the monthly mortgage rate paid by Canadian families, a comment on interest rates from Carney can give banks the jitters and surely affects the blood pressure of millions of mortgage-paying Canadians each month. Carney continues to steadfastly pursue policies which discourage increasing personal or household debt. He insists that mortgages must have strict conditions attached to avoid a U.S.-style mortgage crisis.

The report once again pegged the massive debt loads of Canadians as one of the biggest domestic risks to Canada’s economy. While the bank sees an eventual reversal in the growth of household debt, Carney said that household debt-to-GDP ratios are expected to grow even higher for the foreseeable future, and gave no forecast for when Canadians might start paring down their debt. “It’s hard to predict exactly when the process will come to an end,” he said. The good news is that under Carney’s steady helmsmanship, the central bank now sees Canada’s economy growing by 2.4 per cent in 2012 over its earlier 2.2 per cent target.

Carney lives in Ottawa with his wife Diana, an economist specializing in developing nations, and his four daughters.

Broken and Bankrupt: Greece Stares into the Abyss

May 24, 2012 8:24 am
Greek riot police confront rioters in Athens

Before the turn of the twentieth century, America’s premier financier, John Pierpont (JP) Morgan, famously coined a phrase which has since become a common saying in the English language. Morgan remarked that, “If you have to ask how much it costs, you can’t afford it.” More than a century later, Morgan’s comments could be used to characterize the ongoing disorderly unraveling of the Greek economy. The breakdown of Greek social structure and law and order which have accompanied the nation’s economic collapse pose a very real threat whose consequences could spill over into other Mediterranean countries and could scuttle the viability of the European integration project.

Nearly all of the Mediterranean nations within the European Union’s (EU) seventeen member economic and monetary union known as the “Eurozone” are frozen in a state of economic paralysis due to unsustainably expensive social welfare programs, crippling deficits and runaway public spending. Add to that the lack of political will needed to implement the austerity measures and structural reforms required for slowing the EU’s economic free-fall and for initiating a path towards economic solvency. At the same time, a signal must be sent to global markets that the EU will not continue to spend more than it can ever hope to repay. However, no other EU country is in as dire a condition as Greece. Greece has been the focal point of violent protests, looting and widespread social disruption caused by both depression-era unemployment rates and a population that is unwilling to make the lifestyle sacrifices needed to begin the painful task of putting Greece’s financial house in order. One particular example is worth highlighting as characteristic of the unsustainably expensive social programs that have allowed the small nation to accumulate deficits and debt large enough to threaten the global market. If you were a member of Greece’s swollen public sector, the year would have fourteen months instead of the twelve months everywhere else. That is because Greek public sector employees receive fourteen monthly paychecks per year. Nor does this extraordinary practice end when a public sector employee retires. In fact, former Greek public sector employees receive fourteen monthly pension checks for the remainder of their lives.

John Pierpont (JP) Morgan

Nonsensical forms of spending such as this, coupled with rampant fraud and unwillingness to pay income taxes, have resulted in a lack of the capital reserves necessary to keep the nation afloat and have led to runs on Greek banks which, as a whole, have lost upwards of 30% of their deposit values over the past two years. Without another injection of stimulus funding from Germany, the most economically and politically powerful nation in the EU, as well as from the European Central Bank (ECB) and the International Monetary Fund (IMF), Greece will run out of money by July. Almost immediately thereafter, it will default on its debts. The prospect of this scenario is heightening fears among policymakers and politicians across the globe and is initiating discussion amongst ECB bankers and other economists about the possible consequences for global markets should Greece exit the Eurozone either at the behest of the other member states or by its own choice.

Still, more than three quarters of Greeks continue to express their desire to remain in the Eurozone and the EU despite the fact that they are adamantly opposed to making the financial and lifestyle sacrifices required to do so. To make matters worse, Greece is hurtling towards another election in which the man who may well be the next Greek prime minister is a 37-year-old by the name of Alexis Tsipras who serves simultaneously as both the president of Greek’s ultra-left political party Synaspismos and as the leader of the Greek parliament’s Coalition of the Radical Left, better known as “SYRIZA.” Tsipras is riding a wave of popular support due to his election platform of calling the bluff of the IMF, the ECB and Germany by insisting that Greece will be permitted to remain in the Eurozone even if it refuses to implement the austerity measures and structural reforms which were attached as conditions to earlier bailouts. This is clearly a risky and unrealistic proposition.

The more likely scenario is that Greece will eventually fail to receive further financial assistance from the international community and will subsequently default on its debts, eventually being forced to leave the Eurozone. This would not be pretty. The consequences could be further rioting, pillaging and unemployment, all sending a dangerous shock wave through the global economy. Other struggling nations within the EU would have to face the fear that they too could be next in being forced to fully implement the required austerity measures or be cut out of the EU’s Eurozone. Even worse, the global economy which is struggling to maintain a modicum of growth, could be sent into a tailspin since fear and uncertainty almost always send markets into a steep decline.

Alexis Tsipras

Yet, regardless of whether Greece were to exit the Eurozone of its own free will or not, some are speculating that the economic consequences would not be that severe once the protesting, rioting and looting have subsided. Greece would have to abandon the euro and return to using its old currency, the drachma, thereby implementing a plan of rapid currency devaluation which would make the country a more competitive place to do business and hopefully boost Greek exports at the same time. Such a path back from the economic brink has worked before for other nations but Greece may not be able to enjoy the same results as Argentina which successfully pursued this policy option in 2002. Unlike Argentina, Greece has a limited volume of exports and fewer profitable business ventures to offer at the reduced price that its newly reinstated and devalued drachma would support given that the Greek economy relies predominantly on tourism, agriculture and shipping.

And so, Greece like other Mediterranean nations within the EU continues to limp on towards an uncertain future. But if the international community’s patience wears thin and if current trends in markets persist, Greeks may find out the hard way that, “If you have to ask how much it costs, you can’t afford it.”

The Uncertain Future: France’s Socialist Resurgence

May 18, 2012 9:00 am
Hollande & Sarkozy

All is not well in Europe. The European Union (EU) in general and the Eurozone financial union in particular are in a precarious position. Crushing debts and deficits as well as unsustainably expensive social welfare programs — not to mention unemployment rates in excess of 20% in certain EU countries — have turned what many academics call “Eurosclerosis” (the lack of economic growth and consistently high unemployment rates) into reality for much of Western Europe. International institutions like the International Monetary Fund (IMF) have contributed billions of euros (the EU’s international currency) to stabilize the toxic economies of nations like Greece and Spain in an attempt to prevent them from defaulting on their debts. Should default occur, it could trigger a collapse in the value of the euro, a move which would likely lead to the demise of the Eurozone and possibly the EU as a whole. Such a monumental economic and political collapse would unquestionably plunge the highly interconnected global economy into a severe recession at best and a global depression at worst. But, all of this is old news.

However, the surprising results from both the French and Greek national elections last week have the potential to exacerbate political differences and to further polarize both the European public and European policymakers. At issue is the difficult, but necessary, task of writing and implementing policies that would reduce member states’ deficits as well as government expenditures, all the while spurring growth and reducing unemployment throughout the EU. It is no small task to do so and still remain palatable to European voters. It would be difficult in any country but it is far more so in countries like Greece and Spain which, for all intents and purposes, are currently in depression and not recession. This act of political tightrope walking will be much more challenging in the near future due to the fact that both the Eurozone and EU may well be placed on life support in coming months. While France may not suffer from the same depression-level unemployment rates common in Greece, nor does its balance sheet contain as many toxic assets, France faces a number of challenges which, if not defused, could harm the Eurozone, the EU and the interconnected global economy even more than a Greek default.

Nicolas Sarkozy

Incumbent politicians often share the praise and the blame for their nation’s economic performance. Given the EU’s lack of economic performance, it is not surprising that any incumbent politician seeking re-election in the EU would face public opposition. Last Sunday, French President Nicolas Sarkozy and his centre-right Union for a Popular Movement (UMP) Party lost their re-election bid by a narrow, but still significant, margin of 48% to 51% in favor of Sarkozy’s Socialist challenger Francois Hollande. In the past, the French Socialist Party (PS), now led by Hollande, has only elected one man to the highest office of government. Thirty-one years ago, in 1981, the Socialist Party’s Francois Mitterrand was elected President of France. He remained in power throughout much of the 1980s and served a second term in the first half of the 1990s.

Generally speaking, financial markets did not react positively to Mitterrand and the Socialists’ tenure. There is a likelihood that markets will again react negatively to a France led by a Socialist government, but today the consequences could be more serious than when Mitterrand was in power. Francois Hollande has taken an anti-austerity stance which resonated with the large population of French unemployed and also with the public sector workers who would likely bear the brunt of any austerity program intended to stabilize the Eurozone countries. Doubtless, these positions played a crucial role in the defeat of Nicolas Sarkozy, a man who led a party which advocated the merits of austerity and whose flamboyant personality has taken its toll on French voters’ good will. Hollande has advocated the need for protectionism, has called for the implementation of a 75% income tax on wealthy French individuals (which would strangle growth and innovation) and has rejected the austerity measures required to keep France’s fiscal house in order. Hollande says he prefers to have the French economy “grow” its way out of recession and that he is not averse to using quantitative easing to spur that growth.

At best, Hollande’s agenda will likely create an unpleasant environment in which the 27 member states will seek to solve their debt and unemployment problems, a task made more difficult since his views directly challenge those of German Chancellor Angela Merkel. Merkel leads the EU’s strongest, most economically solvent country and has stressed the importance of balancing the EU’s books and of reducing deficit and debt by way of austerity measures. Negotiating and implementing successful policies could be more difficult when the EU’s most powerful country (Germany) and second most powerful country (France) have two conflicting ideologies separating them on the important issue of countering the ongoing European economic crisis. At worst, this conflict could make any further coherent economic policy-making an impossibility, thereby derailing future hope for the stabilization of the EU’s economy and the lifespan of the euro as a viable currency.

Francois Hollande

France and Germany, along with the other 25 nations in the EU, would suffer greatly should this occur. This scenario would deal the global economy a crippling blow that could suddenly halt the current anemic recovery in the majority of the world’s developed economies. Unlike Greece, France is well-integrated into the larger European marketplace in terms of the business it conducts beyond its borders. For instance, French companies operating outside of France, but within the EU, provide some 4.5 million jobs in a cross-section of virtually all forms of business. Furthermore, unlike Greece, these 4.5 million satellite French workers create products and services which, when combined, account for almost one fifth of all European investments in terms of monetary value.

To raise the stakes even further, France’s financial system provides significant capital and loans to other EU countries like Greece, Spain, Portugal, Ireland and Italy — countries which are burning through money as if there were no tomorrow. Some of those countries may well default on their debt no matter how much money the International Monetary Fund (IMF) or Germany may reluctantly provide to shore up their hemorrhaging economies. Should President Hollande obstinately pursue his hard-line, hands-off position against austerity which runs counter to that advocated by both Germany and the IMF, France and its creditor nations could fall into the abyss.

Queen In Disgrace: Canadian Task Force in Ukraine

May 17, 2012 6:01 pm
Unknown

Once she was the face of the Orange Revolution.With a peasant-braided hairstyle that she wore as a crown, Yulia Tymoshenko led mass protests that swept Ukraine in 2004. She was a leader of the Fatherland Party. In 2005, Forbes magazine pronounced her the third most influential woman in the world. Tymoshenko served twice as Prime Minister of Ukraine. In 2010, she became the first female to run in presidential elections. But shortly after losing to Victor Yanukovich, the queen of the Orange Revolution has fallen into disfavor, to put it mildly.

Today, Tymoshenko is a prisoner and a patient at a hospital in Kharkiv.

Shortly after Yanukovich became president, Tymoshenko was arrested and charged with allegations of abuse of her office in striking a gas deal with Russia in 2009. Analysts claim the deal was doomed because of market fluctuations and the country’s economic crisis – it was a political error, not a criminal offense. The court nevertheless found Tymoshenko guilty, also charging her with tax evasion and embezzlement.

She was sentenced to seven years in prison.

Tymoshenko is a prisoner and a patient at a hospital in Kharkiv.

Many European countries and the United States condemned these actions against Tymoshenko; human rights organizations called them politically motivated, as other members of the opposition were also prosecuted.

In April, Tymoshenko went on a two-week hunger strike protesting her inhumane treatment in jail. Tymoshenko, who suffers from chronic back pain, said she was beaten by guards. As pictures of a bruised Tymoshenko emerged on TV screens and in newspapers, European leaders have been putting more pressure on the Ukrainian government to relent.

German Chancellor Angela Merkel refused to attend a European summit in Yalta. Merkel went as far as calling Yanukovich’s regime “a dictatorship.” The leaders also halted the Association Agreement with Ukraine – an agreement aimed at bringing economic benefits to Ukraine. Earlier, some leaders threatened to boycott the EURO 2012 soccer championship to be hosted by Ukraine and Poland, but later withdrew their threat.

The members, however, are clear: EU doors will be shut to the Ukraine, as long as Tymoshenko remains in prison.

Why Canada Cannot Remain Neutral

While turmoil over Tymoshenko is broiling in Europe, Canada cannot afford to remain neutral.

To Canada, the Ukraine is more than just a faraway Eastern European country. Canada is home to 1.2 million Ukrainians, who settled in Western Canada 120 years ago. Today’s foreign policy is mostly built on bilateral trade agreements, too valuable for both countries to put at risk.

In 1994, Canada proclaimed Ukraine a “special partner.” Over the years, after signing several trade agreements, Canada has become one of the major exporters of fish, seafood, pork, pharmaceutical products and aircrafts; and importer of mineral fuels, oils, fertilizers, iron and steel. In 2010 alone, trade between the two countries totaled $252.2 million. In 2011, this number exceeded $507 million, according to Ukrainian embassy statistics.

This week, a Canadian delegation is paying a visit to the Ukraine to conduct hearings on economic, political and judicial issues, upcoming fall parliamentary elections as well as human rights.

Tymoshenko, once a popular figure in the Ukraine, has been sentenced to 7 years in jail.

Tymoshenko is in the limelight of Canada’s Standing Committee on Foreign Affairs and International Development hearings, led by Mississauga-Erindale MP Bob Dechert.

Taras Zalusky, an executive director of the Ukrainian Canadian Congress and a member of the delegation, said the committee has a busy schedule. Zalusky said that they have already met with Tymoshenko’s lawyers, as well as officials from the prosecutor’s office and of the ministry of justice. It’s a four-day visit, and the committee will present a report of their findings on Thursday.

Canada, Free-Trade Agreement and International Pressure

Canada and the Ukraine are in the process of round table talks on signing a Free Trade Agreement (FTA) that will give Canadian businesses even broader access to the Ukrainian market without tariffs. The Foreign Affairs and International Trade website states that the FTA will be “consistent with Canada’s foreign policy objectives, which support Ukraine’s democratic transformation and economic reforms.”

Even though Rudy Husny, spokesman for Minister of Free Trade Ed Fast, said the government is “concerned by the apparently arbitrary and politically-biased nature of judicial proceedings against Ms. Tymoshenko, and other individuals, which undermines the rule of law;” Canada will still proceed with the FTA. Unlike Europe, Husny said, Canada does not believe in the politics of isolation. In fact, according to Husny, signing the FTA will foster economic growth in the Ukraine, which in its turn will help to “secure democracy where human rights are respected.”

The Ukrainian Stand

Marco Shevchenko, a chargé d’affaires of the Embassy of Ukraine, said he isn’t be able to comment on Tymoshenko’s case, claiming that neither diplomat or politician should interfere with the judicial process. Shevchenko only hopes that both governments won’t become hostages of political situations in their economic decision-making.

Marco Shevchenko

“We separate political and economic content,” Shevchenko said. “Both sides consider business above all.”

Shevchenko said Tymoshenko is planning to appeal her case to the Supreme Court of Ukraine.

Asked how the country could have fair parliamentary elections when the leader of the official opposition party is in prison, Shevchenko said, as a citizen of the Ukraine, he would never vote for a party that can’t survive without its leader.

On May 9, Tymoshenko ended her two-week fast and was transferred to the clinic to treat her back pain and the effects of her hunger strike. A German doctor was brought in to treat her. According to the latest news, after Kharkiv’s hospital made her treatment schedule publicly available, Tymoshenko refused to undergo any further treatment. The opposition leader says it is private information that is not to be shared.

It’s still unclear what the future holds for the Ukraine, a country that is torn between Europe and Russia. It’s unclear whether President Yanukovich will remain autocratic or make necessary democratic reforms before Europe turns its back on him. But what’s certain now – the disgraced queen of the Orange Revolution will still keep drawing the world’s attention.

The Natural: Laureen Harper Talks Family, Fitness and Canadian Pride

May 14, 2012 8:48 am
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Laureen Harper is a natural. She’s found the secret to balancing her official duties, being a mom and finding time to do what she loves most.

There is more to Laureen Harper than meets the eye. Charismatic and unpretentious, her personality is a refreshing reminder that although she may be the woman alongside Canada’s Prime Minister, she’s also busy with work of her own.

Laureen Harper grew up in Turner Valley, a rural town in the foothills of the Rocky Mountains, southwest of Calgary, where she developed a lifelong passion for the outdoors and a love for animals at an early age. Today, she advocates for the proper care of animals and opens her home to kittens waiting to be adopted from the Ottawa Humane Society. Known for her extensive volunteer work and her support of important community causes, Laureen Harper’s focus on family, community and charity is a reflection of her down-to-earth sensibilities.

I caught up with the on-the-go mom at 24 Sussex Drive to talk about raising a family in the spotlight, her no-fuss fitness regime and what makes Canada the best place to live in the world.

Alexandra Gunn and Laureen Harper. Photo by: Deborah Ransom

ALEXANDRA GUNN:  Being in the spotlight day in and day out must be difficult to manage. How do you separate your personal life from your public life or is that even doable?

LAUREEN HARPER: You’d be surprised; a lot of people don’t recognize me. I walk around Ottawa and no one knows who I am. I think it’s because most of the time no one knows who you are or they don’t put two and two together. The other day, I was coming out of Walmart and a woman came running after me to see my receipt.

AG:  I’m sure you’re always recognized at public functions and political events. I would assume that a lot of people want to respect your privacy.

LH: That woman wanted to see that receipt! She was making sure I wasn’t stealing (laughs). In Ottawa, I go to a lot of events, so people are used to seeing me, but most of the time I just think they don’t know who I am. I’m not a celebrity or a movie star, so I can run down Wellington Street right in front of the House of Commons, past all the reporters who don’t even notice. It makes me smile because they are so busy talking that I go running on by with no makeup in my running gear and they don’t even look twice. I think sometimes they are going to say hello but they keep on walking.

AG: You may be able to go unnoticed on your runs, but raising a family in the public eye while juggling your official commitments must be tricky at times, so how do you stay grounded?

LH: I am a stay-at-home mom, so I spend a lot of time with my kids. They’re getting older, so they don’t want to spend as much time with you (laughs).

AG: Family always comes first but you’re also generously donating your time to a variety of charities. Are there any particular organizations that you believe support a great cause?

"I’m always focused on animal charities and animal welfare." Photo by: Deborah Ransom

LH: I’m always focused on animal charities and animal welfare, so when I’m in Calgary or Ottawa, I work with the Humane Society. There are so many great charities doing wonderful work, so if I can help them I will. I work with the Trans Canada Trail and the National Arts Centre Gala benefitting the National Youth and Education Trust. In 2017, the Trans Canada Trail is going to go from coast-to-coast-to-coast. It’s 75 per cent done now and I’ve already been on sections of it and I’m hoping Canadians will take advantage of it when it’s done. The National Arts Centre has really become the National Arts Centre. It brings in artists from across the country and bring music to Canadians from all over. The NAC Gala allows for the foundation to do work across the country. It isn’t just here in Ottawa; it goes across the country and helps a lot of kids who otherwise wouldn’t get music education. I really think they do a great job. I also really like regional theatre. I love all of these regional theatres that we have across the country; they’re little treasures. We are really lucky to have great theatre houses. Some are them are in the middle of nowhere and they are creating jobs and opportunities for actors and playwrights.

AG:  It’s nice to see that you dedicate so much time and effort to Canadian charities. If you had a few extra hours every day, how would you spend them?

LH: I would go hiking or doing something outside. I love being outdoors.

AG: Growing up near the Rocky Mountains must have inspired your love for adventure and hiking. What are some of your favourite outdoor activities that you like to take part in?

LH: I love to snowshoe – that’s my favourite. I try to snowshoe as much as I can in the winter. In the spring, I like to hike because there’s always something interesting going on in the hills. Anytime of the year I can snowshoe or hike. I love the Gatineau Hills in Quebec, but when I’m in Calgary, I hike in the Rockies or along some great hiking trails in and around Calgary. I don’t care if there’s a hill – I just like hiking. When I was growing up in Turner Valley, my family loved to hike. People were poor and so there wasn’t much to do. There was no going to theatres or concerts. We had the mountains 20 minutes away so we did what was available. We would head to the mountains to hike and camp and it was great because it didn’t cost any money.

AG:  Do you encourage your two children, Ben and Rachel, to enjoy the outdoors as much as you do?

LH: Yes, as much as I can. There are some great parks in Ontario and Quebec and we’ve recently learned to canoe. And we always do one mother-daughter canoe trip every year, which I really enjoy.

AG:  You must know some great spots across Canada. Where do you usually go?

LH: (laughs) I don’t want to say because then other people would go there! Where we go is such a great place and it’s so close to Ottawa, but very few people know about it. Rachel and I usually canoe and camp for three days and two nights, but you can’t make kids go too long because they can get bored. It’s our secret canoe spot.

AG:  Hiking and adventure are high on your list, but do you have a particular fitness regime that you try and stick to during the week?

Photo by: Deborah Ransom

LH: I know I should, but I don’t. I love to run and that’s what I do. Everybody does different activities but I try and run five times a week. In the summer, I run outdoors and in the winter, I just go on the treadmill. There are no excuses with the treadmill. If you run outside, it can be too windy, too hot or too cold. I love the treadmill. There are so many great activities, but they go in and out of style, so I stick with what works.

AG: There are quite a few big races in Ottawa throughout the year. Do you ever participate?

LH: We do charity races but I only compete against myself. I like doing charity runs for fun, but I’m not under any illusions! I tried to keep up with Peter MacKay for the Army Run and I only lasted about a kilometre and told him to go on without me. He did five kilometres in 22 minutes and I can’t!

AG: Aside from running, what are some of the things you do to stay healthy?

LH: I try to eat lots of fruits and vegetables. Well…we try (laughs). I think snacks should be snacks, but we try to stick with fruits and vegetables and then we have one day a week where we cheat. Salt-and-vinegar potato chips are the perfect cheat food. I want the whole bag, which is why I hate those 100-calorie bags – there are only four chips in there!

AG: You’ve had the opportunity to travel the world with your husband and as a solo traveler many years ago. Now that you’ve seen so much of the world outside of our borders, what do you most appreciate about Canada?

LH: The space. It’s so clean in Canada. When I come back from trips, I think how we are the luckiest people to have a country that is as big and beautiful as it is. Canadians appreciate what we have.

AG: What do you recommend to an out-of-country guest as a must-see if they will be traveling across Canada?

LH: Every region of the country has something amazing. So many Canadians travel outside the country on their vacations, which I think is a real shame. There are people from Western Canada who have never been to Eastern Canada and there are lots of Eastern Canadians who have never been to Western Canada and I think they should travel around Canada. Anyone who has been to Newfoundland knows it’s a great time. Niagara has great wineries. I’d recommend Toronto’s theatre district. Vancouver is one of the most amazing cities on earth. And, of course, head to Calgary for the Stampede! Every region of the country has fantastic festivals and it’s the people who make Canada a great place to live and visit.

AG: The Calgary Stampede will be celebrating its 100th anniversary this year. Will you be attending?

LH: You betcha! I’m inviting every person I know to come to Calgary. We will likely run out of space and will need to put mattresses down, but it’s a great festival that everyone needs to experience at least once. It’s difficult explaining the Calgary Stampede to someone who has never been to one. The entire city gets involved in the Stampede festivities – every street, every shopping centre and every community centre. I think it’s going to be the biggest party we’ve seen in a long time. This is the year to go. You have to experience it!

AG: Now that the warmer weather is here, what else are you looking forward to doing?

LH: I always do a big hike somewhere in Canada in the summer with a group of friends. We try to pick a different place every year. Last year, we went to the Yukon and this year, we are going to go hiking in the Kootenays in British Columbia. It’s nice to go somewhere where no one else is, even if it takes two or three days to get there. It’s always a wonderful feeling. A couple of years ago, we hiked for five days and only saw two people and one grizzly bear.

Photo by: Deborah Ransom

AG: Your keen sense of adventure must translate well when you accompany your husband on official business at home and abroad. What are some of the memorable moments that you often look back on?

LH: Traveling across this great country and getting to go to every province and every territory, which most Canadians don’t get to do. My husband and I get to do that all the time, but it never gets old and we love it. Every time you go somewhere you’ve never been before, it’s amazing and I always say that I want to come back here and spend more time.

AG: Looking back on the past few years, is there anything you’d wish you had done differently?

LH: No, I don’t think so. My husband works very hard and sometimes I wish he didn’t, you know? But that’s the nature of the job and he loves his job. He loves going to work and we are very lucky that we get to spend time with our kids. We miss our families back in Alberta, since we only see them three or four times a year. I’ve made lots of good friends across the country so there are no big regrets. We just miss our family in Alberta, so we’re thankful we get to go back so often to visit. All in all, it has been amazing.

Canada’s First Lady, Laureen Harper Supports These Charities:

The Humane Society The Humane Society of Canada (HSC) works across the street, across Canada and around the world helping people, animals and the environment.  www.humanesociety.com

Canada Army Run The Canada Army Run is about Canadians and the Canadian Forces – Air Force, Army and Navy – joining together in the spirit of camaraderie and mutual respect. It’s a chance for the troops to extend the military esprit de corps to Canadians and to thank them for their support. www.armyrun.ca

Trans Canada Trail The Trans Canada Trail promotes and assists in the development and use of the Trail in every province and territory. Today, more than 16,500 kilometres of trail have been developed. When completed, the Trail will stretch 22,000 kilometres from the Atlantic to the Pacific to the Arctic Oceans, linking 1,000 communities and all Canadians. www.tctrail.ca

National Youth and Education Trust (NYET) provides funding for the performing arts, programming and educational initiatives for young artists, young audiences and schools across the country.

Photography by Deborah Ransom

Hair & Makeup by Noah at facesbynoah.com

The Price of the Word: It’s Time for a Change in Kazakhstan

May 10, 2012 9:33 am
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Journalism and fear never go well together.

Just one day before I interviewed CBC foreign correspondent Nahlah Ayed, who has been covering the Middle East for over a decade, I learned that somebody tried to kill my colleague in Kazakhstan, journalist Lukpan Ahmediarov.

As I was interviewing Ayed, I couldn’t help but admire her courage. She is always packing her bags to report from a conflict-torn part of the world, leaving behind her safe and comfortable life in Canada. She said if you are not brave, just don’t go there. Her words echoed what once Ahmediarov told me: “if you are afraid of your own work – don’t be a journalist!”

Ahmediarov was shot three times and stabbed eight times from behind. Even though his vital organs remained intact, he is still in critical condition after a three-hour operation.

A week later, Ahmediarov was able to record an eight-minute video message to the public – a video that might cause his enemies to try to kill him yet again.

In the video, Ahmediarov says he has no doubts that his profession and civil activities are the main reasons somebody wanted to silence him. Moreover, he says, once stable, oil-rich country ruled by President Nursultan Nazarbayev for more than 20 years, are now torn by rifts which appeared as the president feverishly tried to hold onto his power.

With a bandaged head, Ahmediarov addressed many issues the country is facing, heavily criticizing the government. The correspondent says that by silencing journalists the government can’t hide its problems. It’s time for President Nazarbayev to step down, he says, and allow the country to have a proper democracy with a rotation of powers. “His [President Nazarbayev’s] project is exhausted,” says Ahmediarov.

(CP-Raul Uporov)

Lukpan Ahmediarov being taken to hospital after his attack

But the journalist is more amazed at how the president is out of tune with his citizens’ mood. He says in 20 years, since the USSR collapsed, people have learned how to think critically. They can’t just read and believe self-censored, state-owned papers, nor do the citizens accept the messages conveyed by the presidentially-owned media.

Now, Ahmediarov says, people are realizing how absurd the regime has become.

By absurd the journalist means holding last year’s referendum to allow 72-year old President Nazarbayev to remain in power for life, and allowing the President’s supporters to erect monuments to him, claiming that it’s the peoples’ wish. It’s absurd, the journalist says, for the police without any investigation, to make a statement which claimed his attempted has nothing to do with politics or his profession.

“Kazakhstan has realized: That’s it! We can no longer live in such a country, and we must not live in such a country,” Ahmediarov declares. “It must be a normal country with a change of governments. That’s why people started talking – I was not the first.”

Indeed, Ahmediarov wasn’t the first citizen to raise concerns. In December 2011, the police opened fire on protesters in Zhanaozen, leaving 16 people dead, 100 injured. On the 20th anniversary of Kazakhstan’s independence from the former Soviet Union, laid-off oil workers stepped out onto the main street. The police claim that they shot protesters out of self-defense, while some witnesses say the striking workers were unarmed.

Meanwhile, Ahmediarov’s case left Uralsk and its citizens shaken. Uralsk is a city with a population of 350 000, situated on the northwestern border of Kazakhstan and Russia. Everybody in town knew the journalist had many enemies because of his bold articles and civil activities, but nobody had ever expected that somebody would attempt to kill him.

“I think in Uralsk, local powers got mad because in the battle with me they could not present anything adequate. I fought for my rights, for my freedom, for the rights of other Kazakhstanis. I never broke the law. Whatever I did, whether it was protesting on the streets or writing articles, I always told officials that I have a right to express my opinion.”

But not so, according to the Freedom House. In its 2012 charter on worldwide freedom of the press, Kazakhstan ranked 175th out of 196 countries, while Canada ranked 25th. For a democratic Kazakhstan with an embedded constitutional right to free speech and press, its status still remains “not free.”

Uralsk City Hall

Last year’s report on freedom of the press raised concerns about the country’s law that classifies libel as a criminal offence, with high penalties for the defamation of the president, members of the Parliament and state officials. In the first six months in 2010, there were 44 libel suits against journalists – the majority came from government officials. In 2009, for instance, Ramazan Yesergepov, the editor of the independent weekly Alma-Ata Info, was arrested in the hospital where was being treated for hypertension. Yesergepov was detained for eight months, and later, sentenced to three years in prison.

Tamara Eslyamova, editor-in-chief of the Uralsk Weekly, is familiar with every challenge that independent media face. Her newspaper is the only independent paper in Uralsk. It’s also the paper Lukpan Ahmediarov was writing for. Eslyamova says the government always pressures the print houses, distributors, sale outlets, denying them services. She and her journalists always receive angry calls and are harassed and threatened on the streets.

A botched contract-killer hit on Ahmediarov came to her as no surprise. In a telephone interview, Eslyamova said Ahmediarov had just written an article on how government officials are distributing multimillion-dollar projects to their families and relatives. Eslyamova says she knew after this article, officials wouldn’t go easy on the journalist, but the editor says Ahmediarov was always reporting such stories.

Why? Because he is not afraid to start a whirlwind or expose the truth.

More on the story:
Struggle for free press in Kazakhstan

Polling Déjà vu in Wild Rose Country

May 3, 2012 9:01 am
The day after the 1948 election President Truman holds the Chicago Tribune with its faulty prediction

In November of 1936, in the depths of the Great Depression, incumbent Democrat President Franklin Delano Roosevelt was running for re-election in what appeared to be an extremely hostile political climate. The American unemployment rate was roughly 25% and there was an ideological divide in much of the country regarding the reception of Roosevelt’s New Deal plan to boost employment, not to mention the then-unprecedented expansion of the Federal government required for its implementation. According to the Literary Digest, the nation’s most respected polling source at the time, the Republican Governor of Kansas, Alf Landon, was well on the way to defeating Roosevelt with a commanding margin. But, when election night drew to a close on November 3, 1936, the polls would tell a different story.

FDR on the cover of the magazine that three years later would inaccurately predict the results of the 1936 US presidential election.

Franklin Delano Roosevelt not only defeated Landon, but he did so by the largest Electoral College margin in American history. Roosevelt obtained a staggering 523 Electoral College votes, representing over 60% of the popular vote and 46 of the then 48 states. Landon, on the other hand, was only able to gather a miniscule 8 Electoral College votes and roughly 36% of the popular vote as well as just 2 states. The Literary Digest’s dead wrong polling prediction resulted from an unrepresentative and skewed sample which was concentrated in the state of Maine alone and which relied upon responses from fewer than one quarter of the anticipated respondents in that state. Furthermore, due to the Literary Digest’s predominantly white-collar readership base, the majority of those who did participate in the already under-represented survey were more likely to support Republican Governor Landon than the incumbent Democrat President who advocated a less business friendly and more regulatory laden approach to governance, thereby skewing the poll’s sample even further. Not surprisingly, in the wake of the unanticipated election results, the Literary Digest’s polling operations lost all credibility, and the magazine ceased publishing shortly thereafter.

History would repeat itself twelve years later when, in the general election of 1948, another American polling miscalculation again predicted a victory for a candidate who would never move into the White House. In 1948, Democrat President Harry Truman — who had served as Vice-President in Roosevelt’s fourth term and who was sworn in as President after Roosevelt’s death in the spring of 1945 — ran his first campaign for the presidency against the moderate Republican New York Governor Thomas Dewey and the more radical States’ Rights or “Dixiecrat” Party candidate Strom Thurmond. At the time, renowned pollster Elmo Roper, like the majority of the other pollsters in America, was predicting a large win for Thomas Dewey. In fact, the Chicago Daily Tribune was so confident that Truman would be defeated that, on the evening of the election, it set the headline “Dewey Defeats Truman” on the front page of the morning edition for the following day without waiting to confirm the election results.

Alberta's Progressive Conservative (PC) Premier Alison Redford.

The results were not quite what the Chicago Daily Tribune, and much of America for that matter, expected. Not only did the incumbent President Truman defeat his Republican challenger, but the Democrats also picked up a majority in both the House of Representatives and the Senate. Once again, the pollsters were dead wrong and, as was the case in 1936, this discrepancy could be traced back to an unrepresentative sample. The majority of the pollsters stopped canvassing and sampling respondents in the pivotal final few weeks before the early November election. Elmo Roper’s polling ceased almost two full months before election day based on the assumption that voters’ opinions wouldn’t change in the period between the end of the primary contests and the general election itself. Thus, the belief in the inflexibility of voters’ opinions, which resulted in a lack of up-to-date polling, led to a polling blind spot: the increasing favorability of Truman and the Democrats that was building in the final few days of the election campaign went almost completely unnoticed.

Sixty-four years later, the recent unexpected defeat of Alberta Wildrose leader Danielle Smith by incumbent Progressive Conservative (PC) Premier Alison Redford in the Alberta provincial election demonstrates that the same reasoning which led to the unanticipated election victories in 1936 and 1948 is alive and well inCanada. The vast majority of Canadian political pundits, pollsters and commentators were predicting that an easily-won Wildrose majority government would form the next provincial government with Danielle Smith as the first non-Progressive Conservative Premier in 12 election cycles — or more than 40 years. They had it wrong, most likely because of a flawed sample.

Wildrose Party Leader Danielle Smith.

In the weeks preceding the election, virtually all the polls across the province of Alberta reflected the likely scenario that Danielle Smith and her recently formed, more conservative Wildrose Party would be swept into power. These polls were neither inaccurate nor misleading. However, what the majority of these polls missed was the change in voter opinion which took place in the last three days before Albertans voted. Many of the polls relied on by political pundits, pollsters and commentators as barometers for the public opinion of Albertans consisted of out-of-date sampling research and responses. In other words, since most pollsters in the province stopped contacting respondents to gather information prior the critical 72 hours before the election itself, the polls were inaccurate due to a sampling method that was beyond its “best before” date and which was therefore unrepresentative of the voters’ true perceptions. At least three days out-of-date is better than the nearly two months out of date which characterized the polling of Elmo Roper and that of many others during the 1948 American presidential election.

Today, it is business as usual in Alberta politics. Premier Alison Redford and her Progressive Conservatives (PC) will remain in power with the party’s 12th consecutive majority government, albeit with a smaller majority than has been the case since the year of Canada’s centennial celebration in 1967. But when it comes to conducting the accurate polling of voters’ public opinion, mistakes from yesteryear surface yet again in 2012, shocking the political pundits, pollsters, commentators and the general public. Once again, the more things change, the more they stay the same.

Controversial Public Servant Cuts Coming – Canada’s Magic Shrinking Trick

April 27, 2012 4:03 pm
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Public Servants Series

What will Canada look like if tens of thousands of public sector jobs are lost by the end of this year? That is the question plaguing economists, unions and political analysts alike. These potential job losses follow the federal Conservative government’s announcement to freeze wages and deliver $8 billion in cuts over the next five years. The goal? Rid Canada of its $56 billion deficit over the same time period. Last year’s announcement prompted a collective gasp of horror. Not since Paul Martin’s 1995-96 austerity Budget has Canada seen anything close to such numbers. That was the year Ottawa cut program spending by 8.8 per cent and reduced public sector employment by 14 per cent. Cuts of that magnitude loom again. Treasury Board President Tony Clement told the Empire Club of Toronto in January the cuts could be as deep as ten per cent, which equates to spending “of anywhere between $4 billion and $8 billion.” Without question, Canada will feel the reductions. Big time.

And while Martin’s shrinking trick saved Canada from becoming, as the Wall Street Journal put it “an honorary member of the Third World” this time around there are poignant differences.  The Conservative’s $4 billion program spending cuts amounted to less than 2 per cent of total federal spending. (This would the Treasury Board maintains, return the federal government to a balanced budget in 2015/2016.) The Chrétien-Martin cuts amount to spending cuts of more than 2.7 per cent of GDP. What really makes the impact different this time around is the nature of the cuts. Martin’s 1995-1996 Budget spread the pain – payments to individuals, transfers to other levels of government and direct program spending. The current Conservative government’s focus is on direct program spending which means highly concentrated layoffs of the public-sector employees that deliver them. And it is this aspect that has the public sector unions worried – very worried.

Without question, Canada will feel the reductions. Big time.

The Professional Institute of the Public Service of Canada (PIPSC) that represents 57,000 government scientists and professionals maintains Canadians will lose all round. The cuts will imperil the economy and leave Canadians bereft of crucial public services. (An economic analysis by the Canadian Association of Professional Employees (CAPE) released in February projects the loss of up to 116,000 jobs in Canada’s public and private sectors. CAPE argues this will topple Canada into recession.) How can a country with a gutted public sector provide sufficient public services? Gary Corbett, PIPSC President remains dedicated to doing just that. “We are committed to defending the public good due to the erosion of public services and the related economic and social impact of job losses on communities across the country.”

The type of public services slated for cuts also concerns Corbett. “Our members are professionals whose jobs can be summed up as protecting Canadians. Any time thousands of their positions are on the line, public safety demands a full and transparent accounting of the impact,” says Corbett. Earlier this year, the government announced the layoffs of food and safety inspectors and scientists that monitor water quality and pollution levels – that is, public servants crucial to the functioning of a first-world country. Read more about PIPSC on page 54 of Ottawa Life Magazine March/April Edition.

An analysis by economic think tank the Canadian Centre for Policy Alternatives (CCPA), “The Cuts Behind the Curtain: How federal cutbacks will slash services and increase unemployment,” validates Corbett’s concerns. The CCPA estimates federal government employee job losses of between 60,100 and 68,300. The City of Ottawa would be especially hard hit. Our city’s unemployment rate would soar from 6.2 per cent to 9.2 per cent.

The CCPA also looked at programs that would be cut.  Some of the most vulnerable are hit hard. Support for low-income families, seniors, the unemployed, environmental programs, programs for Aboriginal on-reserve housing, training and primary health care and workplace and food safety inspectors would all be cut. Canada, the CCPA report maintains could lose up to 1,500 food and safety inspectors in the Canadian Inspection System – all within 12 months. “This” the report added, “despite Canada’s still-vivid memory of the 2008 listeriosis outbreak.” (This refers to the Maple Leaf Foods tainted cold cuts incident that killed 23 Canadians.) And if that wasn’t enough, Canada’s international profile would be hurt. Cuts to Canada’s international development program would also be affected.

Proposed by the Tories is $1 billion in cuts over the next fiscal year, $2 billion for 2013-14 and $4 billion (which could go as high as $8 billion) by 2014-15. Under the microscope are 70 government departments and agencies which are required to submit scenarios for a five and ten per cent cut to their budgets. This, the Tories say, will help eliminate a $31 billion deficit by 2015-16.

Proposed by the Tories is $1 billion in cuts over the next fiscal year.

A way of assessing the potential impact of the cuts is to compare and contrast the Tory slash plan with the size and shape of the 1995-96 budget cuts.  At the time of the 1995-1996 cuts, the world had written off Canada as an economic basket case.  Ottawa cut deep and Canada rebounded. The GDP grew an average of 3.3 per cent a year. Canada then proceeded to outpace other G-7 economies, investment grew 5.4 per cent a year and employment expanded by 2.1 per cent. The number of welfare recipients halved and the national debt fell to 29 per cent in 2008-2009 from 68 per cent in 1995-96. The federal Conservatives believe the 2012 cuts might set Canada on track again. But the tone, the vein and intent feel different this time around.  Many argue the Tories are targeting many of the programs and public services that are defining features of the Canadian fabric, what makes our country unique.

Might there be another solution to Canada’s deficit conundrum than across-the-board cuts to government departments?

Lieutenant-General Andrew Leslie, who commanded the Canadian army during the Afghanistan mission thinks so. So do economists and social think tanks like the Canadian Centre for Policy Alternatives, the C.D. Howe Institute and even the Conservative Fraser Institute.

Leslie proposes a nuanced approach. Instead of axing across the board, cuts should be targeted. Ironically, he says the Department of National Defence should be cut. In Report on Transformation 2011, Leslie proposes a wholesale deflation of the national headquarters of Department of Defence. Among the 43 recommen-dations is the redeployment and elimination of 3,500 regular forces personnel and 3,500 civil servants in the department, cutting 30 per cent from the $2.7 billion spent each year on private contractors, consultants and services and the consolidation of departments that overlap and dupli-cate each other.

Niels Veldhuis, Vice-President of Canadian Policy Research at the Fraser Institute.

Niels Veldhuis, Vice-President of Canadian Policy Research at the Fraser Institute, advocates a Martin-era redux. “What they did was to put every single government department under a series of six tests. This is something the current government should do today.” The final results might, Veldhuis suggests, result in some departments being unaffected by cuts, some being disbanded altogether with others falling mid-way. The Martin tests included assessing departments on affordability, ability to serve the public interest, scope for private/public sector partnerships and the necessity of government involvement. Reductions at the spending level are another solution to Canada’s deficit woes. Veldhuis suggests the removal of the 100-odd “special treatments” such as credits and allowances offered by the government to the ordinary taxpayer through to corporations.

David Macdonald, Senior Economist at the CCPA, the Fraser Institute’s ideological counterpoint, offers  another solution Canada’s deficit woes – eat the rich. Solutions include a new tax income bracket for Canadians who earn $250,000 a year or more, closing high end tax loopholes for Canada’s ultra wealthy, getting rid of the capital gains tax and capping Registered Retirement Savings Plan (RRSP) contributions to $15,000 instead of the current $22,000. Only wealthy Canadians can contribute $22,000 a year, turning RRSPs into a tax shelter for the rich.

Alexandre Laurin from the C.D Howe Institute offers other revenue raising solutions – user fees for services offered by Crown Corporations, the full or partial privatization of government services and switching the tax mix from corporate taxed to consumption taxes. Easing the corporate tax burden would Laurin says “create more economic growth.”

But no matter the solution to Canada’s deficit woes, the effects of the government’s plans on the country remain a dark horse.  As the government unveils its budget, things will likely become a bit clearer.  But it has been a situation that, Corbett, as the head of Canada’s largest professional public sector employee union, finds unacceptable. “For us it is about working smarter, not cutting the public sector wholesale, it’s about better planning and identifying where you want to take the public service.” Time will tell where Canada’s public service will end up and where Canadians are going to feel the pinch.

SIDEBAR: Finance Minister Jim Flaherty disagrees with conclusions in report by CAPE

Finance Minister Jim Flaherty

While public sector service unions are heeding CAPE’s findings, Canada’s Finance Minister Jim Flaherty dismisses them.  In February, Flaherty told CBC’s Evan Solomon that CAPE’s projected $8 billion cuts are “way outside the realm of possibility.” As for the prospect of 116,000 job losses, Flaherty stated the government has “a very complicated process for work adjustment in the federal government. Nothing happens quickly in terms of work adjustment changes: it takes a year or two, even perhaps three in some cases, so moderation in all things, and we have a fair amount of attrition.” However, when Solomon probed Flaherty on the scope of the estimated between 5-10 per cent  cuts Flaherty remained tight-lipped. “We’re working on it, reviewing all the work of the Deficit Reduction Committee and we’re not at final figures and I’m not being coy about that,” Flaherty said. With the 2012 Budget being tabled in the House of Commons on March 29, only time will tell.

The Expendables: Political Advisors, Consultants and Media Commentators

April 17, 2012 9:13 am
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It is said that there is no honour among thieves. After watching the reaction from both the White House and the Democratic National Committee (DNC) to recent comments made by one Hilary Rosen concerning Ann Romney, wife of the Republican Party’s likely presidential nominee, we could safely expand this old adage to read that there is no loyalty among politicians and their advisors in an election year.

Last week, when appearing on a three-way discussion panel on CNN’s Anderson Cooper 360, Democratic political consultant and White House advisor Hilary Rosen attempted to frame Republican presidential candidate Mitt Romney as being out of touch with today’s female American voters. She claimed that Romney’s wife, Ann, could not be seen as a true spokeswoman for the problems, concerns and fears that many working (and out of work) women are grappling with because she was wealthy. More specifically, Rosen stated that, “Guess what? His [Mitt Romney’s] wife has never actually worked a day in her life. She’s never really dealt with the kinds of economic issues that a majority of the women in this country are facing, in terms of how do we feed our kids, how do we send them to school, and why do we worry about their future.”

Hilary Rosen

Rosen’s remarks did not go unnoticed. Shortly after the panel discussion was over, Ann Romney responded to Hilary Rosen on FOX news, driving home the fact that she has worked for decades raising a family and has indeed faced many challenges in so doing, challenges which are like those of many American women regardless of their socio-economic status. In essence, Ann Romney rebutted Hilary Rosen’s comments by insisting that raising a family is as valid a form of work as is working a nine-to-five job outside the home. In the immediate aftermath of Rosen’s remarks and Romney’s response, President Barack Obama, his administration and the Democratic Party machine have proactively engaged in damage control in an effort to distance the President from the likely fallout that Rosen’s “class and gender warfare-based” gaffe would have on the Democratic Party in general and on President Obama in particular.

Knowing that the stakes were too high in November’s presidential election to risk any association with anything or anyone that could hamper the President’s re-election campaign, senior White House officials immediately began excommunicating Hilary Rosen from the Democratic Party. During a press conference, White House Press Secretary Jay Carney said that Hilary Rosen did not work for the President as an Obama re-election advisor and stated that he did not even know who she was. On CNN, David Axelrod, who is serving as the chief campaign strategist for President Obama’s re-election bid, unequivocally stated that Hilary Rosen’s comments were her own opinions and that she was not associated with the White House as an advisor to the President — despite the fact that Rosen had visited the White House for business purposes more than thirty times in the recent past according to Secret Service records.

Ann Romney

Gaffes like Hilary Rosen’s are nothing new in politics. However, what is new is the immediate dog-eat-dog reaction that Rosen’s comments have precipitated, a reaction which has so far resulted in her being shut out or, to put it more bluntly, thrown under the wheels of the bus by her own political party in near record time. When politicians make a gaffe — and all do no matter on which side of the aisle they may sit — there is more room for forgiveness than there is with political operatives, consultants and media commentators. For instance, when outgoing President Ronald Reagan referred to Michael Dukakis, the Democratic Governor of Massachusetts who would challenge Republican George H.W. Bush in the 1988 presidential election as an “invalid” at a White House press conference, or when, on the 2008 campaign trail, then Democratic Senator and now Vice President Joe Biden told a wheelchair-bound Missouri State Senator to “stand up,” people let it pass. However, when a political consultant or advisor makes a gaffe, the situation is markedly different. Immediate dismissal and no delay in distancing the politician from the offending individual is often the first line of defense in the battle to avoid damaging reaction in the court of public opinion. The reason, of course, is that the comment, if left unaddressed, could very well translate into a loss of votes at the next election. Such is the case with Hilary Rosen.

Rather than admitting that Rosen was indeed a White House advisor who erred in making a comment that was accusatory and inappropriate (a common enough human failing), the Obama administration has spared no effort in distancing itself from her. As a result, there is little doubt that her career as a Washington-based political operative and Democratic political consultant is likely over. Politics at the national level has always been a zero sum game; yet it would seem that the consequences are especially swift for advisors and consultants who find themselves at the wrong end of a comment which could prove damaging to a re-election campaign. The reaction to Rosen’s comments should serve as a warning to all political operatives and workers that loyalty is not absolute and that, in an election year, everyone is expendable. This lesson is equally as pertinent here in Ottawa as it is in Washington.

Global Trade Wars Past and Present: the Smoot-Hawley Tariff Act of the Sky

April 3, 2012 9:07 am
U.S. Representative Willis C. Hawley & U.S. Senator Reed Smoot in 1929

In 1930, as the United States of America and much of the Western world slipped further into what would later be called the Great Depression, the American Congress and Republican President Herbert Hoover were convinced that the best way to stop the hemorrhaging economy was to pursue a path of ardent protectionism through the implementation of “beggar thy neighbor” policies. The best known of these policies was the Smoot-Hawley Tariff Act which was signed into law in June of that same year amidst much support from a broad cross-section of the American populace. Although the Act was originally intended to spur investment and create employment in America’s declining agricultural industry by placing extremely high tariffs on foreign agricultural products, by the time that congressmen and senators from both parties were through, the law had raised tariffs to unsustainable levels in virtually all segments of the American economy.

Naturally, nations outside of the United States quickly retaliated by tabling their own protectionist laws with the aim of increasing tariffs on American products and services. Some countries even went so far as to ban the purchase of American products and services in the attempt to make their own economies competitive despite Washington’s protectionist response to the economic crisis. The Smoot-Hawley Tariff Act backfired on Herbert Hoover and the Republican Party by strongly exacerbating the Depression and by contributing to the election of America’s only four-term president, Democrat Franklin Delano Roosevelt, two years later in 1932. The end result of the Smoot-Hawley Tariff Act and the retaliatory “beggar thy neighbor” protectionist policies that it spawned was arguably the first global trade war in history.

A Boeing 707 lifting off.

Today, despite the Western world’s efforts over the decades to encourage freer trade and thus avoid repeating history in terms of the Smoot-Hawley Tariff Act, it would seem that the protectionist urge still lives on. One need look no further than the European Union’s (EU) ongoing attempt to require all airlines flying into EU airspace to participate in its Emission Trading Scheme (ETS). In an act of bureaucratic arm-twisting, that scheme would force the international airline industry to become more fuel efficient and pay reparation to the EU for the amount of carbon dioxide emitted by commercial airplanes flying into the EU. As of this past January, all airlines flying into the EU are legally obligated to purchase carbon credits which are to be used to offset the emissions created by burning jet fuel in the turbine engines that power virtually all commercial airplanes. Although payment for such permits does not become mandatory until the spring of 2013, airlines in countries operating outside of the EU are already beginning to implement their own retaliatory measures.

Not surprisingly, the United States, Canada, Russia, China, India and also the majority of the other nations that maintain large commercial fleets beyond the borders of the EU strongly object to the EU’s unilateral, punitive program. They are seeking the most effective way to implement retaliatory measures against the EU’s overreaching bureaucracy if a diplomatic solution cannot be found. The retaliatory response to the ETS being considered by many nations consists of a mix of both legislative and economic action.

China has officially prohibited its national airline from participating in the ETS.

On the legislative front, China has officially prohibited its national airline from participating in the ETS. India has taken a similar stance by advocating a boycott of the program, while the United States of America and many other Western countries have considered the possibility of altering existing flight paths so as to bypass the geographical regions included in the ETS. That move would translate into the loss of countless millions, if not billions, of dollars of revenue generated by tourism and its supporting industries which have taken the easy access to countless travellers from beyond the EU for granted in their current business models. A refusal to fly into EU airspace by many popular airlines would require travellers to land in countries outside the EU and then to find their own alternative form of transportation into the EU, a move which would make travelling to EU countries more difficult and also more expensive. Given such a scenario, if countries within the EU wanted to maintain the steady stream of travellers required to sustain their existing business models, they would likely have to assume the extra costs associated with facilitating access to the EU. In a nutshell, travellers would face a much more complicated two-step process to enter the EU. Furthermore, within the international aviation community, there is talk of imposing a surcharge upon all European flights, something that could be even more costly than the consequences from the ETS.

Within the international aviation community, there is talk of imposing a surcharge upon all European flights.

To make matters worse for the proponents of the Brussels-based program, China is in the process of cancelling an order from France’s aircraft manufacturer Airbus, a deal said to be worth over $14 billion. That move will represent a substantial economic loss of revenue for the French manufacturer in particular and for the European aeronautic industry in general. It would seem that “beggar thy neighbor” policies are back and that the ETS could more appropriately be labeled the “Smoot-Hawley of the Sky.”

The only real difference between the controversial piece of American legislation from the 1930s and the current ETS is that the motivation for the protectionist legislation has changed substantially. In the 1930s, the motivation for the Smoot-Hawley Tariff Act was based on creating a way to allow American businesses to better exploit America’s natural resources for economic gain. Today, some eighty-two years later, the European Union is unilaterally implementing a punitive tariff program under the guise of protecting the planet from industry-specific growth in carbon dioxide emissions and reducing the exploitation of global natural resources — in this instance, the fossil fuels from which jet fuel is made. The more things change, the more they stay the same.

While the threat of the world’s first global trade war in the sky looms on the horizon, there may yet be a silver lining should the EU refuse to soften its hard-line approach on the objections to the ETS. If the nations that refuse to participate in the ETS follow China’s lead and vote with their feet by cancelling the purchase orders of EU-made commercial aircrafts, North American aircraft manufacturers such as America’s Boeing and Canada’s Bombardier could gain the billions of dollars in revenue from future fleet purchases that would have gone to European manufacturers like Airbus had the ETS program not been enforced.

Negative Political Advertisements in 1988: The Blueprint for Today

March 20, 2012 10:41 am
negative-political-advertising

Any day you’re not moving the ball forward, it’s moving backward. Lee Atwater, the controversial Republican political consultant and mentor to Karl Rove, coined this insightful maxim while he was serving as the manager for George H. W. Bush’s 1988 presidential campaign. Atwater’s statement can be considered a timeless piece of advice that should be kept in mind by all politicians, political consultants and pundits no matter where they may fit on the political spectrum. The core principle behind the maxim is the importance of staying on message, of always defining yourself and of never letting your opponent define you. However, since consistently achieving these ends in any political campaign is not always an easy task, the ball often begins moving backward when all three goals are not reached.

Many tactics are used by political consultants in the attempt to move the ball forward when crafting their candidate’s message and to avoid having the ball roll backward by being pulled off message because of distractions from opponents or from the media itself. However, there is one widely-used tactic in the United States, and which is increasingly used in Canada, offering the potential to move the ball both forward and backward simultaneously, thus helping one candidate but hurting another at the same time. That tactic is none other than the negative attack advertisement.

Lee Atwater

Negative advertisements are nothing new. They have been used for the better part of half a century in American politics, but it wasn’t really until the 1988 presidential election that the effectiveness of the technique would be fully realized. Flawlessly executed, it could diminish the credibility of the target of the advertisement while successfully reshaping voters’ opinions of the attack ad’s intended protagonist. In 1988, the National Security Political Action Committee aired an advertisement that is still considered by many to be the most successful negative attack ad of all time: the infamous “Willie Horton” advertisement.

The advertisement contrasted Republican George H. W. Bush’s view of crime and its punishment with that of his Democrat opponent, then Governor of Massachusetts Michael Dukakis. It focused on Dukakis’s policy of granting weekend passes to prisoners serving time for felony offences in the state of Massachusetts. In a manner deemed by many to be racially charged, the advertisement highlighted how Willie Horton, an inmate serving a life sentence for murder, was let out on a weekend pass but went AWOL. During his extended weekend leave, he kidnapped a young couple, stabbing the man and raping the woman before being apprehended some months later in the state of Maryland. The advertisement wrapped up with the pithy phrase, “Weekend prison passes: Dukakis on crime.” Although the advertisement was produced outside the Bush campaign by the National Security Political Action Committee, when it was coupled with the guerilla-like campaign tactics utilized under the direction of Atwater, the Bush campaign was able to reshape the public’s opinion of Dukakis and eliminate his roughly seventeen point lead in the polls. The end result was a landslide victory for Republican George H. W. Bush in November of 1988.

George H W Bush & Lee Atwater in 1988

Twenty-four years later, the legacy of those negative attack ads perfected in the 1988 presidential campaign lives on. In the ongoing 2012 Republican presidential nomination process, candidates have spent millions of dollars generating negative advertisements in an attempt to reframe and redefine an opponent in a less favorable light, albeit with more subtlety than in the no-holds-barred Willie Horton advertisement.

The success of the Willie Horton ad demonstrates that using negative advertisements can move the ball forward, benefiting those who launch the advertisement and, especially, the candidate who is positively associated with the advertisement. However, there is always the possibility that this same practice can be damaging to those who launch the advertisement.

Mary Matalin, the widely respected Republican political consultant who worked on the 1988 Bush campaign with Lee Atwater and who served as the deputy campaign manager for the 1992 Bush re-election campaign, stresses the importance of keeping a campaign positive until just before going negative. Launching a negative ad when the public already views your candidate negatively can be extremely damaging since it risks a backlash from those who claim to hate negative campaigning. In other words, you cannot successfully launch a campaign by projecting negativity from the outset. To do so would seriously jeopardize your campaign by swiftly moving the ball backwards. The pitfalls of such a strategy are illustrated by the recent Ontario provincial election where the Progressive Conservative leader, Tim Hudak, who went negative from the outset and did not project a positive vision for Ontario, was rejected by Ontario voters.

Mary Matalin

Because they understand that negative advertising can be a dangerous double-edged sword, many candidates will claim that they are running a “positive” campaign and will extol the virtues of such a campaign to voters even as they purchase millions of dollars worth of airtime and fire one negative attack ad after another at their opponent. To see a striking example of this phenomenon, one need look no further than the Republican presidential candidate nomination race. In state after state, most candidates have launched multiple negative advertisements but are still careful to remind voters that they are running a positive campaign. This seemingly contradictory behaviour brings to mind another old maxim worthy of note: that is, in all politics, perception is reality.

Shallow Graves

March 19, 2012 4:34 pm
Pg21_by OLM Staff

The Kingston Mills Locks are located off a road that snakes its way through north Kingston. They can be usefully described as a point at which the city merges with the countryside. It was here that on June 30th, 2009 the Kingston Police made the grim discovery. Three sisters and an older woman were found dead in their Nissan Sentra, submerged in the Rideau Canal. Zainab, Sahar and Geeti – aged 19, 17 and 13 respectively – were the daughters of Mohammad Shafia and Tooba Yayha. The fourth victim was 52-year-old Rona Amir Mohammad, who at the time was thought to be the girls’ aunt.

The Shafia family had driven from Niagara Falls to Kingston the night before, where everyone with the exception of the brother Hamed was to stay, before making the final leg of the journey home to Montreal. After Zainab, Hamed was the second oldest child. Both he and Mohammad would later tell the police that he decided he would keep driving to Montreal that night and return to Kingston in a couple of days. Mohammad would later inform Detective Steve Kroopman that it was a last-second decision for the rest of the family to stop in Kingston. “If Tooba was awake we would have kept driving to Montreal,” he says to the detective. If they had kept driving, his three daughters and their aunt would never have gone missing. Zainab, he would go on to say, had a history of taking the family car out for “joy rides.” Perhaps this explained their disappearance. In any case, when the vehicle and bodies were found, it was assumed their night of innocent fun took a tragic turn. At some point while driving the car Zainab found her way to the locks and, with the other three passengers still in the car, drove into the Rideau Canal. Trapped in the submerged vehicle, the three sisters and their aunt had little chance of escape. Although the water in which the car and bodies were submerged was only a few metres deep, it was believed the four victims drowned to death.

Publicly, the police allowed the family to grieve. Nevertheless, their suspicions about the parents and their son were immediate and ran deep. The reasons were obvious. The notion that three daughters and their aunt would take a car out for a ‘joy ride’ was possible, but hardly likely. Rona’s presence alone would have raised doubts for the police. How irresponsible would she have to have been to willingly go out with three young girls? Zainab, after all, didn’t even have her driver’s license. That sort of behaviour would not only have been irresponsible, but utterly reckless given what the police soon learned about her family. Mohammad, the police discovered, was exceedingly strict, especially where his daughters were concerned. Their punishment for taking the car out for a ride would have been severe.  The story’s implausibility was exacerbated by its tragic end. It was almost impossible to imagine a scenario in which a driver would mistakenly veer off the road, onto to the grass and then into the canal. It would require a deliberate effort to drive a car in the part of the canal where the Nissan was found.

The Shafias’ claims about what happened on that fateful night their daughters and Rona went missing were bizarrely inconsistent and implausible.

Indeed the Shafias’ story and the Kingston Police’s immediate response established a pattern that was to become the hallmark of the subsequent investigation and trial. The Shafias’ claims about what happened on that fateful night their daughters and Rona went missing were bizarrely inconsistent and implausible. The Shafias, moreover, were ill prepared for the intense scrutiny to which they would soon be subject. All three would change their stories and all three would sometimes appear indifferent and even disdainful of the legal process in which they were hopelessly caught up. The police and Crown prosecutors, by contrast, were professionally trained to tease out inconsistencies in these sorts of stories and to uncover motives for murder. The police didn’t allow their immediate suspicions to prompt unwarranted conclusions. They would meticulously gather and examine evidence while remaining committed to upholding the rights of Mohammad, Tooba and Hamed. The police also knew had to set traps. The Shafias would quickly fall into one.

Police suspicions justified a court -issued warrant allowing police to wiretap conversations among Mohammad, Tooba and Hamed. The recorded conversations would prove decisive in the investigation. Mohammad especially would strike any listener as not only guilty of the murders, but also unrepentant and self-righteous.

“If they came back a hundred times, I would kill them a hundred times again,” he says in one conversation.

He refers to his daughters as ‘whores’ who brought shame to the family. When Tooba expresses a hint of remorse, he insists that what they did was right. The recorded conversations were remarkably self incriminating. Together they constitute a damning body of evidence. They were also remarkable for establishing the twist-ed rationale for the murders. “Even if they hoist me up in the gallows, nothing is more dear to me than my honour….Let’s leave our destiny to God,” he says at one point. In two sentences, Mohammad articulates the ideas motivating his decision to kill his daughters and his first wife. Mohammad’s faith complemented his zealous commitment to upholding his family’s honour.

In addition to the recorded conversations among Mohammad, Tooba and Hamed, there was other compelling evidence that the three were guilty of killing the three sisters and Rona. It was soon discovered that Rona was not the aunt of the sisters but rather Mohammad’s other wife. Hamed’s claim that he had driven to Montreal the night the four victims went missing was contradicted by his cell phone activity, which suggested he remained in Kingston. He would call 911 the next day to inform the operator he had been in a single vehicle accident in an empty Montreal parking lot. Yet there were parts of a broken headlight found at the Kingston Locks, suggesting that the Nissan had been pushed by another vehicle into the canal. That vehicle was presumed to be the family’s Lexus. The used Nissan had been purchased only days before. Hamed had conducted on-line searches for web sites that provide instruction on how to murder someone without getting caught.

Police formally charged Mohammad, Tooba and Hamed with four counts of first-degree murder on July 22, 2009.

There was a shared sense among those observing the trial – the media and local residents – that the deaths were not a tragic accident, but instead a horrible crime. Each new revelation only confirmed the shared belief that Mohammad, Tooba and Hamed were guilty of the crimes for which they were on trial. Mohammad couldn’t even summon a sense of remorse. At one point in the proceedings prosecutor Laurie Lacelle asked him if he thought his daughters and Rona deserved to die.

“Yes,” he said.

“If they came back a hundred times, I would kill them a hundred times again."

Yet the prosecution’s assessment could not definitively answer all questions concerning the deaths of the daughters and Rona. The biggest challenge stemmed from the indeterminate outcomes of the forensic reports. For the reports did not precisely reveal how Zainab, Sahar, Geeti and Rona died. If they drowned, why was there no indication they had tried to escape from the vehicle after it was pushed into the Rideau Canal? Were they rendered unconscious before being pushed? This would seem likely and yet the pathologists suggested there were no traces of alcohol or drugs in the four women’s bodies. Both the Crown and the police must have been aware of the potential uncertainties such imprecise findings may have raised for the jury. Their shared strategy thus had to focus less on the question of how precisely the four women were killed, and more on why they were killed. Why would Mohammad, along with his second wife Tooba and their son Hamed be intent on killing four of their own flesh and blood in such brutal fashion? The answer, according to the Crown, was to preserve the family’s honour. The prosecution would contend that according to the three accused, the daughters had sacrificed that honour by shamelessly adopting Western styles of dress and behaviours. As for Rona, she was an expensive nuisance whose inability to conceive was another source of family shame. The proof was in the long trail of evidence of abuse and intimidation. The Shafias created an intolerable climate of fear from which all the victims in their own way had tried to escape.

Rona Mohammad’s memoirs make for compelling reading. The story that emerges from them is one of a middle-aged woman who felt trapped in an abusive marriage and an unhappy home life. The memoirs document the family’s circuitous route to Canada, the birth of the family’s seven children and, most interestingly, the growing rivalry between Rona and Tooba, Rona’s growing fear of Shafia and Sahar’s despair. It is small wonder that the prosecution introduced the diary as an important piece of evidence.  Rona’s estrangement from Mohammad appears rooted in her inability to conceive. Mohammad went to great lengths to help Rona towards this end, but also resented her for her inability to give him the children he desperately desired. Tooba was able to provide Mohammad with seven children, a fact that she apparently leveraged to assume a more privileged and dominant role in the Mohammad household. Rona strikes the reader as increasingly aware of her precarious place in the family. She fears Mohammad and Tooba’s shared hostility. Occasionally she is defiant, especially towards Tooba. But her defiance is tempered by her genuine desire to establish a more secure existence and more fulfilling home life. Her efforts were to no avail. At one point, Rona writes of a conversation between herself and Tooba.

“You are not his wife, you are my servant,” Tooba says to Rona.

On another day, she writes of Mohammad “hitting her.”

By virtue of being the oldest sibling, Zainab had come closest to escaping her oppressive home life. She would fall in love with a young man. At one point, she left home for the relative safety of a women’s shelter. But, as the jury would learn, the family persuaded her to return home. She would later marry her boyfriend, only to have the marriage annulled the next day.

Sahar attempted suicide and spoke of how fearful she was of her father and brother.

The trail of evidence led directly back not only to the Shafia household, but to Antoine de Saint-Exupery, a school located in the Montreal borough St. Leonard and attended by both Sahar and Geeti. School staff was increasingly alarmed by both girls’ behaviour and wondered if their home life was the source of their struggles. There was evidence that the parents did not want Sahar and Geeti to get an education. Their absentee record would have been among the highest among students at the school. Their grades suffered. Sahar attempted suicide and spoke of how fearful she was of her father and brother.  She told teachers that she hoped to leave school and get a job. It was not because she was without academic ambition. On the contrary, Sahar spoke of wanting to study to become a gynecologist and return to Afghanistan with the hope of helping women there. But her home life was so distorted by fear and abuse that what she wanted to do now was to work so that she could leave home and support herself and her sister Geeti. That scenario was impossible. Quebec’s laws would not have allowed it.

Sahar’s terror is what inspired hopes of escape, but it is what also served to keep her in her family’s grips. When confronted with the knowledge that her parents would be called to the school, she immediately retracted the allegations. School staff would soon learn why. When speaking to staff, Tooba wanted to know if Sahar had kissed a boy she was perhaps dating. Sahar’s teacher at the time responded no, Sahar had not kissed a boy not because it wasn’t true, but because she feared for Sahar’s safety.

For those teachers and school officials who knew Sahar and Geeti, the evidence that their home life was characterized by threats, intimidation and sadness was too great to ignore but beyond the school’s mandate to address. Quebec’s Youth Protection Agency was thus called to assess the sisters’ problems in school and at home. The response on the part of the child protection agency was immediate but, in the end, somewhat bewildering.

The testimony of Jenna Rowe exemplifies why this is so. Jenna Rowe is a retired social worker who worked for Quebec’s Youth Protec-tion Agency. In her testimony, she conveyed intelligence and sensitivity, exactly the combination of traits one would hope to find in a social worker. On May 7, 2008, she was given a Code 1 report (codes highlight the urgency of the problem. Code 1 is the most urgent) regarding Sahar. Sahar was complaining of being extremely fearful of her father and had recently attempted to overdose on medication in a bid to commit suicide. But when Ms. Rowe spoke with Sahar in person, the young girl again retracted her allegations. She pleaded that her parents not be informed of what she had said or that she had attempted suicide. Ms. Rowe insisted, however, that she was obligated to speak with her parents. According to Ms. Rowe, Sahar was crying profusely during their entire conversation and that she was extremely fearful. Although not inevitable, such a reaction on the part of a young girl who has very good reason to fear her parents is somewhat predictable. If her father is abusive, then of course she is going to be terrified of him knowing that she has disclosed such abuse to teachers and social workers. Social workers must be intimately familiar with this sort of scenario.

Moreover, Ms. Rowe’s interviews with other family members should have done nothing to assuage her concerns for Sahar’s safety. Tooba indicated she had no idea Sahar felt “emotionally rejected,” nor did she know that Sahar had taken pills in a bid to commit suicide. She adamantly denied they exerted any pressure on Sahar not to go to school. Yet Sahar’s frequent absence from school is one reason why teachers and social workers were so concerned about both Sahar’s home life and her life as a student. Ms. Rowe’s remained deeply suspicious of Tooba’s denials.

Ms. Rowe’s interviews did not end with Sahar’s mother and nor did her suspicions. She met with the father and son that same day. In keeping with everyone’s testimony who had any contact with the father, she said he was “very angry” when he learned a report had been filed. He demanded to know who filed the report and declared from the outset that he would hire a lawyer. Ms. Rowe assured him that he would never be told who filed the report. He angrily denied every allegation. He vehemently dismissed, for example, the suggestion that his son cut Sahar’s arm when he threw a pair of scissors at her. “Do you think I would give my son permission to do that to his sister?” he remarked to Mrs. Rowe.

Other than the string of adamant denials on the part of all family members interviewed, there was little that would have assuaged Ms. Rowe’s concerns for Sahar’s well being. Yet after contacting her manager the decision was made to let Sahar go home, but with the understanding that they would conduct follow up assessments. They did so. On May 8th, Sahar was at school and on May 9th, Ms. Rowe met with Sahar again. Sahar was wearing the hijab that day. Ms. Rowe characterized Sahar as still cautious but happier. She indicated she wanted to stay at home. Somehow this was enough assurance that Sahar’s problems at her home had been satisfactorily resolved. “It was decided the child wasn’t necessarily at risk,” Mrs. Rowe testified. The file was closed.

Burned Alive

In her heartbreakingly sad memoir Burned Alive, a young Arab woman, who goes by the name Souad, writes of her life growing up in a remote village in the West Bank. From a very young age, she understood that her life would be horribly constrained by custom and violence. Her father would regularly tie her hands and feet to a pole and tape her mouth shut to prevent her from screaming out for help or in pain. He would then proceed to beat her with a cane or a belt. Souad knew that her only hope of escaping her brutalized existence was to marry a man. It was perhaps this certainty that helped to stir her love for a nearby neighbour. She first began throwing him discreet glances from her home’s terrace. He reciprocated and before long they would rendezvous in a field with tall grass in which they could remain hidden. They had sex on a few occasions. Souad was soon pregnant, but the man with whom she was in love disappeared upon hearing the news that he was the father. She endeavoured for months to conceal her pregnancy in the hope that there would be some resolution to her ordeal. But when her parents confirmed that she was with child, a decision was made to kill her. They could not tolerate the shame that their unwed daughter’s pregnancy would bring to bear on them. The family’s honour was at stake. One day, Souad’s brother-in-law doused Souad in gasoline and set her ablaze. As the flames consumed her, she ran to an area where others saw and – mercifully – helped her. They sprayed enough water to extinguish the flames and managed to get her to a hospital. She survived despite her family’s best efforts to kill her even as she was being hospitalized. In prose that is disarmingly precise, she explains to the reader the place of girls and women in her community and the role notions of shame and honour assume in her family.

Speaking of her brother, she writes, “Assad was violent like my father. He was a murderer, but that word doesn’t have any meaning in my village when it comes to having a woman killed. It is the duty of the brother, the brother-in-law, or the uncle to preserve the family’s honour. They have the right of life and death over their women. If the father or mother says to the son: ‘Your sister has sinned, you must kill her,’ he does it for the sake of honour…”

The term “honour killings” has been attached to the deaths of the daughters and Rona as soon as police suspected that they were murdered and not the victims of a tragic accident. Police soon came to believe that the four victims were murdered in order to save the family’s honour, as understood by the father.  To make the point, one of the prosecution’s last witnesses was an expert in honour killings. Shahrzad Mojab is an Iranian born professor at the University of Toronto. Mojab’s testimony constituted a powerfully effective summary of the ideas that seemingly motivated the Shafias.

“Even the assumption of non-marital relations is seen as a huge violation of the family honour….Even a rumour can cause the killing of a young woman,” Mohab testified.

Moreover, the female body is where honour is contested. Men who adhere to this system of beliefs will often seek to ruthlessly control women – wives and daughters – under their dominion. She went on to say that no one religion can be identified as the source of this phenomenon, as honour killings have been carried out among people of all the major faiths.

The female body is where honour is contested.

The defence did not have an enviable task. The recorded conversations, the physical evidence and the demonstrated motive together constituted an overwhelmingly strong body of evidence against Mohammad, Tooba and Hamed. Although they would question the alleged time line of events, the thrust of their strategy was to challenge the perception that the three accused were fundamentalists who would be motivated to uphold their family’s honour in such a ruthless fashion. During Tooba’s testimony for the defense, for example, she insisted the family was much more liberal than they have been depicted. The defence did show family photos in which the female members weren’t wearing headscarves or the hijab. They also made clear that Shafia grew up in an accomplished and seemingly liberal Afghani Muslim family. His brother is a surgeon. Others are similarly accomplished. Mohammad himself was a successful businessman who left Afghanistan with his family in order to escape the sort of tribal customs with which he was now being associated. The underlying point was clear, even though the defence never explicitly stated it. Mohammad would not kill three of his daughters and his first wife because they would not adhere to his Quran-inspired rules.

Indeed much of Tooba’s testimony was meant to reconcile the Quran’s competing dictates. Yes, she said, it was their duty as Muslims to instruct their kids in the way of their faith. But they could not force their daughters (or the rest of the family) to abide by all of its rules. Were these not the priorities of any parents who wanted their kids to retain their faith while growing up in a secular society? Similarly they were told they could not have boyfriends or get married until after they finished school. But ultimately it was their choice as to whom they would marry. Tooba recalled her uncle’s insistence that Zainab marry a relative of his. Tooba repeatedly informed him that his daughter wasn’t “chattel” and he therefore could not keep pressuring Zainab to marry this man.

Yet, most of Tooba’s testimony could not have persuaded the jury that she, Mohammad and Hamed were innocent. On the contrary, much of what she said about Mohammad only confirmed that he has a terrible temper and that the family – including Tooba herself – lived in fear of upsetting him. Tooba repeatedly suggested that she wouldn’t inform him of developments for fear of his reaction. If he was angry at someone, he would yell and constantly raise the subject long after the incident in question had passed.

In late January of this year, the jury delivered its verdict. Mohammad, Tooba and Hamed were all convicted of first-degree murder and sentenced to 25 years in prison without parole. Most of those who gathered outside the courthouse celebrated the verdict. But the palpable sense of relief didn’t settle the questions that formed the trial’s backdrop. How could Quebec’s Youth Protection Agency close the file on Sahar with so little evidence that her home life had changed? Even without the benefit of hindsight, the decision to do so seems tragically shortsighted.

The other question to emerge from the verdict’s aftermath is perhaps less understandable. Is the term ‘honour killings’ more obfuscating than illuminating? Although it is a term most perhaps most readily associated with Islam, the violence it denotes can be observed in many different societies and under the banner of every major religion. To be sure, domestic violence is a universal problem. Yet it is pure folly to ignore the particular sets of ideas and customs that allow men to ruthlessly control and indeed snuff out the lives of women.

It was a bleak winter day when I recently walked around the Kingston Mills Locks. A strong wind was swirling, carrying with it first rain and then hail. A flock of geese was gingerly walking on the partially frozen water. At this time of year, the area has a desolate quality about it. Trees are bare, water levels in the locks are low and the visitor’s centre is boarded up. Amid the grey, however, were fresh red flowers placed where the lock ends and Colonel By Lake begins. It is also where the bodies of Rona, Zainab, Sahar and Geeti were found more than two years ago. Much time has passed, but the memory of the four women will not soon be forgotten

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