You Can’t Nationalize Carbon Costs

Whether you’re in the carbon credit market or the car or you’re simply looking for ways to generate revenue, it’s not a good idea to think of a carbon tax as a solution, even though some Canadians think it might be the only way to go.

Why?

It’s morally absurd to nationalize (or localize) carbon costs when the local government might be hosting the producers of carbon, but they’re not reaping all of the benefits.

Allow me to explain …

Say you’re a big country with a whole pile of natural resources. Let’s remind everyone that very few of these natural resources are actually currently owned by the people of that country.

And let’s say that in order to produce, export and consume those products, people already pay an excise tax that is designed to simply extract cash from the pockets of those people to pay for things that they may or may not want, like crappy jets and useless prisons.

And let’s finally agree that the corporations that extract these resources are already getting a free ride because they pay a minimal amount of royalties, all of which are deductible against absurdly low corporate income taxes, most of which are negative because of the vast array of ridiculous writeoffs that we create for these welfare slobs.

And now … we introduce a carbon tax on the people that might use the carbon-based products that non-Canadian companies overcharge us for.

What an insult.

It’s time we got the formula straight.

I will pay carbon taxes when I know that the companies like Shell, BP and Exxon pay a flat tax to the people of Canada for the privilege of extracting our resources.

Until then, adding another tax to Canadian citizens is just another insult to our pocket books and will do nothing – I repeat nothing – to solve the environmental tragedy known as the Tar Sands.

Economics, Media and Mass Manipulation

I don’t recall where I got the link for this site, but the context of this article on Economics, Media and Mass Manipulation is riveting, despite the length. It’s well worth the read, packed with data and the author accomplishes what they set out to do: prove that change is coming, whether we like it or not.

The three pillars sustaining the American empire edifice of never ending war, ever accumulating debt and excessive consumerism are crumbling. The growing corruption and weight of un-payable debt have weakened the very foundation of our grand experiment. The existing structure will surely collapse. My entire adult life has tracked the decline of the American empire. I had become comfortably numb. I came to my senses and began to question all the Federal government/Wall Street/Corporate Media sponsored truths about eight years ago. Many others have also awoken and begun to challenge the false storylines dictated by those in power.

Yeah, right. I can hear you now: whispering about the pot-induced lyrics of Pink Floyd in context of ‘Comfortably Numb’, the chosen title of this piece, but it was this chart the reminded me that income opportunities, taxation and share of income is definitely not skewed in our favour:

Every day we work, we lose money to inflation and taxation. The cards are clearly stacked against us, but apparently things will be OK so long as we continue to inflate our debt, swap real assets for credit assets and keep track of what’s happening with ‘Dance with the Stars’.

What can I say? Things are going to change. If they don’t, things are going to change.

Tax Changes Worth Considering

In the world of fiscal and monetary policy, once you make specific changes, it’s very difficult to turn back on them.

Unfortunately, this is true for reductions that we’ve seen in the past with specific tools like the GST (now HST) which was reduced by Stephen Harper, Dalton McGuinty and other leaders in an economically questionable tactic to get into office. Today, our economic instability continues and yet our leaders still commit to reducing corporate tax rates, forcing us to shake our heads at the gross inequality of Canadian citizens compared to capital owners.

With this in mind, I’d like to spin the topic a little towards something more positive: eliminating or reducing tax deductions. I’m sure lots has been written about this, but I personally feel that little has been done to explore the impact of altering deductions when it comes to corporate and income tax policy. Here are some standard deductions, all of which create questionable policy outcomes:

Car and gas: the more I drive for business, the less I pay in tax. Larger organizations would have entire ‘fleets’ that are deductible for tax purposes. Also, allowing car, gas and other fleet deductions encourages the consumption of the wrong kind of transportation and carbon-based fuels. My mind would change if someone actually developed a functional hydrogen vehicle or mode of transport that used an alternative fuel, but allowing these carbon deductions only keeps us stuck in the 20th century.
Meals and entertainment: the more I eat and the more hockey games I go to, the less tax I pay. This makes no sense.
Land and real estate assets: I don’t know a lot about this, but my instincts are that if we taxed inactive land assets, they would be used for economic activity or put on the market. While this might push down the value of land in the short-run, it would ease the cost for entrepreneurs to open up office space or local retail locations. It would also help put an end to the miles of waste that we see everywhere now with closed offices, land for lease and excessive apartment costs.
Business losses: my understanding is that business losses that are accumulated in any given year can be carried forward for use indefinitely years for the company in question and are also transferable to other subsidiary or parent companies. Are there ways to proactively reduce losses that are carried forward against profitable organizations? I know I’m playing with fire on this, but at what point should we just force unprofitable companies to be shut down?
Charity activity: ‘charity’ runs counter to the goals of profit maximization, so why do we allow massive deductions against corporate activity (some might argue ‘meddling’) with charities and non-profits? Why don’t we just increase the deduction at the personal level?
Professional services: how many lawyers are enough?
Dividend tax preference: once again, I’ll concede that the economics on this topic are grey, but giving preferential tax status to dividend income seems to run counter to income earned from non-dividend sources.
Special incentives and investment programs: All levels of government are hobbled by excessive grant giveaways and most of the companies that benefit from these programs have shareholders that simply don’t need handouts from the public. Great examples of this are the Canadian Magazine Fund and the Canadian Film and Video Tax Credit. Do we really need to give CTV and Quebecor hundreds of millions of dollars each year to produce what amounts to propaganda?

Of course, most of you who are intensely more familiar with tax policy would quickly jump on me and argue that many of these deductions are equal in the sense that small businesses and co-ops can make use of them as much as a large corporation can.

Unfortunately, most small businesses can’t even afford these expenses and rarely take a moment to spend any more than a couple of hundred dollars per year on the odd hockey game or taking a buddy to brunch. As someone who describes himself as a small business owner, I know this to be true.

All I’m suggesting is that we consider caps on these deductions and for some, look at ways to eliminate them all together as effective ways to shape social policy and reaction out of prudent fiscal measures. For example, now that we live in the digital age, why do we need to drive to meetings? Why don’t we just do more via Skype calls or by leveraging other video-conferencing tools?

In an ideal world, we address simply questions of ‘equality’ and ‘fairness’ by understanding that our tax system is excessively skewed to the benefit of those that own it: governments and the corporations that own them.

Simple modifications will improve financial liquidity for our governments and ensure that fairness is restored to average citizens. I think this is something we can all accept, possibly including those with #occupywallstreet.

Ultimately, any or all of these changes push the needle towards a flat tax, but that’s something best discussed in another article.

Open The Books for Everyone

Here’s a great piece from David Climenhaga contributing to rabble about fiscal openness.

While it’s extremely unlikely that the Harperites will follow his advice, I fully agree that now is the time to open all books for any organization that receives (or received) public funds of any kind. If unions are being wrenched open – and I don’t see why they shouldn’t – then we have an opportunity to apply ‘what’s fair’ logic to the other organizations listed below:

Organizations like the bar, medical, engineering and other professional associations that members must join in order to practice in their fields
Private corporations that receive any form of subsidy paid by taxpayers
Private corporations that bid on any publicly financed contract
Any corporation or organization that exists for the purpose of influencing public policy, including lobbying firms and “think-tanks” not associated with public institutions, which have their own reporting requirements
Associations of corporations, businesses or individuals that by definition try to influence public policy and trade practices
Churches and religious organizations that raise funds for other than purely spiritual matters, including the operation of chartable, educational or public policy institutions
Any organization that can give charitable tax receipts for donations

I would add defense contractors and police organizations to the list, assuming the latter don’t already have to fully disclose details about spending activities (eg. G20 largesse) as part of annual budget reports.

It just makes perfect sense. If you want to hide and recede from public scrutiny, then stop milking the public teat. Stop accepting public funds.

If you want to get grants, subsidies or economic benefit of any kind, then accept the fact that the public has a RIGHT to see what you’ve earned, what you did with the money and decide if it was a good use of funds.

If we have this kind of openness, it’ll likely result in a significant reduction in the number of charities that have been set up simply to ensure a tax dodge for their creators and will go a long way to curbing the corruption that we’ve fomented in places like Montreal with programs like the Economic Action Plan.

The age of openness is upon us. Conservatives ramming this aggressive ideological agenda down the throats of left-of-centre organizations like unions and the CBC will only cause grief for themselves as Canadians demand more insight into the rest of the organizations that they are involved with.

I Want Our $100 Billion BACK!

This is a rant. I am very, very upset with you bleeping bleepity-bleep Canadians that voted for Conservatives.

The Conservatives have admitted to rigging the 2006 election and have faced up to penalties related to ‘administrative errors’ related to the In and Out Scandal (admittedly yet to be a scandal because the CTVers and Quebecors make too much money from Conservative advertisements).

Our country is being run by crooks and we’re just sitting back doing nothing.

You bought into the lies of Stephen Harper and his crooked team not once, not twice, but at least three times.

You fell for their pocket-book promises.

You voted for criminals.

You voted for liars.

You voted for thieves.

You voted for bad business managers.

And when your taxes and fees and other costs of living skyrocket because you’re subsidizing tax cuts, jet planes and prisons we don’t need, you will have no one to blame but yourselves.

However, I WANT MY MONEY BACK. Millions of other Canadians should demand their money back as well.

By my calculations, the Conservatives owe Canada at least $100 billion.

Just the GST cut alone probably cost us that much.

London Ontario: Home of the Intolerant

London, Ontario has done what no other city could do: be the first city in Canada to boot Occupiers from public property.

What a shame.

The question that will be on everyone’s minds: what’s next?

Truth be told, I wasn’t sure about the claim to occupy in this small south-western Ontario town, but the reality is this: those that run the city keep pushing ahead with boondoggles that are going to (a) break the election promises of Joe Fontana and (b) keep wasting taxpayer dollars.

So, in answer to my own question, ‘what’s next’: we have to continue to send the message that this kind of waste and crony capitalism is unacceptable.

Montreal’s Bridge to Nowhere

The Conservatives announced a mega-plan to connect Montreal to the south shore of the St. Lawrence River.

What a wonderful gesture.

Ooops. The Conservatives are involved.

“This project will be funded if it’s a P3 project,” they all declare, thumping their chests with great pride with the way in which they’re helping their local construction buddies make billions on the project.

Ooops. They may have forgotten one simple thing: a bridge is just a wee tad different than a road.

I can bypass a road any time I want when additional costs or user-fees are involved. I can take a different route, I can bike through the woods, or I can hike along a new trail that doesn’t include private ownership of commuting channels.

But a bridge. Can I drop a boat in the water to bypass the bridge? Can I swim across? Maybe I’ll haul out my handglider and drift across the mighty St. Lawrence every morning on my way to work.

In other words, forcing the good people of Montreal to be subject to a road toll or private toll booth amounts to forced extortion endorsed by the very government that is trying to help them.

Don’t let the Cons tell you this project has to be a ‘P3′ project and that it has to have tolls unless they figure out productive ways for public transit and HOV users to bypass these costs.

Ontario Election Thoughts

Here are a couple of thoughts in the twilight hours of the Ontario election:

If I get another piece of junk mail from my local PC candidate or phone call from the PCs pretending they’re a polling company, I’m going to lose it. I have never seen a more blatant abuse of marketing ‘privileges’ than with the Tim Hudak Conservatives.
If Ontario voters think Tim Hudak will be any different from Rob Ford, forget it. Look at the complete disaster that man and his brother have been for the City of Toronto. The second that Con steps into the Ontario legislature with any kind of government, everything will be on the table for slashing, gashing and trashing.

Please Ontario.

Send a very clear message on October 6.

Do not give the Cons their precious ‘hat trick’, as Stephen Harper so eloquently calls it.

Do what you can to put an end to Conservative lies and deception in Ontario.

New Market Models

We desparately need a discussion about new market models that will actually work in the wake of the post-20th century debt crisis.

Greece, Spain, Ireland, Portugal and now maybe even the US all teeter on the brink of economic ruin in the wake of debt piled on debt piled on debt.

When defaults are finally declared, the resulting cost spiral will inflate the price of everything from shoes to corn to electricity to books to wheels for your car. The shock may be moderate at first, but eventually we’ll all have fewer dollars in our pockets just as we try to survive.

Most of this debt has been accumulated for one thing: the security state.

The security state consists of several expenditures:

to finance the act of unnecessary wars;
to fund the monitoring and control of all people with baseless crimes so that fees and levies can be imposed at a whim; and to
to punish and incarcerate citizens when these most basic crimes exceed a even more basic level of tolerance according to our dictators.

In Canada, we’re spending anywhere from $50 to $100 billion PER YEAR on the security state and military infrastructure, and yet we’re officially only fighting in one ‘war’ (Afghanistan). Why are we wasting so much money – OUR taxpayer dollars – on something that’s so incredibly unproductive?

Iceland seems to have gone in the right direction by telling bankers and the IMF to go F*** themselves.

Ultimately, we need a new approach to new market models.

Eric Blair of alt-market.com interviews Brandon Smith in this piece on Alternative Markets at Activist Post where he shares some of these ideas. The basic definition of an alternative market:

… it is essentially any method of trade outside the establishment-controlled economy. It could be based on the barter of goods and skills, or the proliferation of precious metals to break our dependence on the fiat dollar (or Federal Reserve Note), etc. It could be a network of people across a county or state, or, an agreement between two friends.

And some thoughts about why alternative markets are labeled as underground or black markets around the world:

They are desperate, and I do mean DESPERATE, to keep us from developing our own private economies. If we are successful, we will no longer be in the position of dependency on the dollar or the sham economy. When it implodes, we will be relatively unfazed, and certainly not tearing each other apart. Meaning, their rationalization for martial law goes straight down the drain. The thought of that possibility really pisses them off…

But would alternative markets be enough when our governments are out of control, paying their friends and military buddies off with our money?

Probably not. So we will also need a Declaration of Debt Independence. It’s a basic concept that’s about to catch on like wild fire as everyone who’s not in control feels the effects of ‘austerity measures’: you write into your Constitution (assuming you have one) that the government is not allowed to issue debt exceeding a certain percentage of your GDP (which should be redefined to capture the cost of environmental degradation and other borrowing from future generations), but to also identify that no government would ever be allowed to spend more than 3 or 5% of their GDP on defense, security and military spending (I would also suggest that this include prisons and other forms of incarceration).

At no point should any citizen’s government be borrowing money from bankers when they should be living within their means. We should be investing in services for our children, not borrowing from their future in a failing effort to cork our insatiable desire for crap.

Public budgets should be for public good: education, health, parks, trees, the environment, investment in the future, regulation and a sturdy and reliable justice system.

Another alternative market model would be extremely feasible if we owned the Internet, but we’re at risk of losing that too under the guise of security, protection from make-believe hackers and terrorists and porn sharks and other freaks that apparently lurk on every digital corner. At some point in the future, we should expect the ‘Wild Internet of the West’ to be shut down in favour of a controlled Internet that’s no more illuminating and accessible than TV is today.

This would take a lot of work but more importantly, money. I’ve been advocating some form of fund-raising effort for some time and would still be at the front of the line if someone were to say they were ready as well.

I can’t do it alone.

If we move on any of the above – and we really have to – hard times will be on their way, but we must stop living beyond our means and we have to shake off the bonds that are being placed our basic rights to communicate, participate and emancipate our day-to-day lives.

So … who’s on board?

Harper’s Message vs Change and Hope

I know. It’s been nearly 2 months since the Canadian election and 40% of those who voted showed their contempt for Canada by electing a pack of crooks.

I tried very hard to bury these painful thoughts about why so many people would fall for the garbage that Harper spun and I think I’ve finally figured out part of it.

Harper’s message was the complete opposite of Obama’s ‘Change’ and ‘Hope’ themes that got him elected in 2008.

And why would this get him elected? OK … so I haven’t quite figure that out yet, but let’s remind ourselves that the central messages were ‘Stability’ and ‘Security’.

What the F*@& do those mean?

Are they threats?

Are they promises?

What I do know is that, despite my massive misgivings for Barack Obama, they are the complete opposite of ‘Hope’ and ‘Change’.

What kind of vision does ‘Stability’ offer the people of Canada?

What kind of opportunity does ‘Security’ generate for Canadians?

I wish we had inspected these promises a little more thoroughly in the run-up to the election.

I wish we had all taken a moment to demand something more visceral from our leaders last May.

I wish we hadn’t all thought of ourselves with the smallness of selfishness that comes with the fear and paranoia that are central to these themes.

If we all had, maybe we wouldn’t be where we are today with Herr Harper in control.

Excited Delirium

Stories about Excited Delirium, the Shock Economy and a little fiction here and there.

Category Archives: Canada