20 Dec 2013

Avoiding the next financial train wreck

(Part 6 in a series)
Back in 2006, into 2007, too-big-to-fail superbanks, complacent governments and boosterish business media ignored the few economists who predicted there would be a financial crisis. Today, governments lack the will or the legal weapons to control the greed endemic to elite bank culture.

Given the persistence of that culture in big banks, I am not at all optimistic that we will avoid another, even more serious, financial collapse in the not-so-distant future.

To prepare for that day -- and perhaps avoid it altogether -- we need to reduce the power of big banks, weakening their grip on society’s financial resources, and challenging their support for destructive, neo-liberal economic policies.

Ordinary people and public-interest organizations have to do two things: First, we must demand that our governments crack down on reckless, corrupt bankers and protect our money in the process.

Second, we have to take matters into our own hands, rewarding and inventing independent financial systems that we can trust and control.

17 Dec 2013

Should Account-holders pay
for High-Flying Bankers' Misdeeds?

(Part 5 of a series)
When the next big financial crisis hits the world economy, and Canadian banks are in distress -- as they were  during the 2008 financial crisis -- the bank-using public will have plenty to worry about.

As we saw earlier in this series, it’s hard to trust banks to protect our savings and investments when so many of them have been exposed behaving unethically, gambling extravagantly on exotic financial instruments, and even engaging in fraudulent activities.

Last week, U.S. regulators adopted the new Volcker rule, which bars American banks from several forms of conflict of interest, including trading securities for their own account, or owning hedge or private-equity funds.

It, and similar new laws in Europe, will help, but they will not stop big banks and rogue investors that are determined to gamble and carry out illegal activities.

Meanwhile, governments themselves are the source of an altogether new threat to our bank accounts that Canadians should watch very carefully. Many, including the Harper Conservatives, are eyeing a new mechanism for rescuing banks whose rash behaviour gets them in trouble. It’s called the “bail in.”

15 Dec 2013

How banks play Russian Roulette
with our financial security

(Part 4 of a series)
The next major threat to Canadian and international financial systems is very likely to come from reckless investors gambling with derivatives, the dangerous betting vehicles that contributed to the 2008 collapse of financial services firm Lehman Brothers and the start of the Great Recession.

Used properly, simple derivatives (literally: a financial asset that "derives" its value from that of an underlying asset) can reduce the risk of some financial transactions. To use a simple example, they can help bakers guarantee what price they’ll have to pay for wheat two years from now. (Click here for an explanation on how derivatives work.)

But big-money gamblers can invest in any of a number of highly risky, extremely complicated kinds of derivatives for purely speculative purposes. When this happens, derivatives are just a form of very dangerous, virtually no-limit, betting.

The problem is that derivatives can blow up!
The problem is that derivatives can blow up. Two former JPMorgan Chase employees are facing criminal charges related to a derivatives trading scandal last year in London that cost the bank $6.2 billion -- enough money to run the City of Vancouver for more than five years. The traders also tried to hide losses from investors and federal regulators.

Cocky JPMorgan Chase CEO Jamie Dimon dismissed  its $6.2-billion loss as "a complete tempest in a teapot." Nonetheless, the image of the bank has suffered in the wake of the outrageous caper.

Hair-trigger derivatives, along with laissez-faire deregulation, greed, and poor homeownership policies in the United States, caused the 2008 economic crisis.

12 Dec 2013

setting us up for another crash

(Part 3 of a series)
Are you ready for the Western world’s economy to crash -- again?

More banks will go under. Many tens of thousands of people will again be thrown out of work. Billions of dollars in "investments" will disappear into thin air.

I believe it’s not a question of “if” financial markets and the economy will crash again, but “when.”

Boom and bust economies are features of unfettered capitalism. There have been more than 20  major international and national economic collapses since the early 20th century.

But now the threat of a nuclear-scale financial implosion is more likely than just an economic downturn or a mere correction.

Many of the big investment banks that caused the near-meltdown in 2007-08 -- well known firms such as JPMorgan Chase and Barclays Bank -- are now more deeply involved than ever in dangerous, aggressive, and even often unethical and/or fraudulent activities.

Economist Joseph Stiglitz, a Nobel Prize winner, warns  that “a resurgence of right-wing economics, driven, as always, by ideology and special interests, once again threatens the global economy -- or at least the economies of Europe and America, where these ideas continue to flourish.”

9 Dec 2013

Out-of-control banks challenge
governments for power & economic might

(Part 2 of a series)
Giant banks are the most powerful institutions in in the world – in many ways as powerful economically and politically as the biggest governments. Unfortunately, the banks frequently use their power in ways that damage the economy and hurt folks living around the world.

Two prominent research projects carried out in recent years paint a picture of a ruthless banking and financial sector powerful enough to dictate the nature of key parts of the world’s economy and challenge the strongest politicians.

Research carried out by three Swiss economists reveals the links and structure the giant financial institutions dominate and use to their advantage.

The researchers looked at 30-million “economic actors” around the globe. Their remarkable research found  that a group of 147 trans-national corporations (TNCs) controlled nearly 40 per cent of the economic value of all TNCs in the world. More shockingly, financial institutions make up 75 per cent of the organizations at the core of this powerful group: what the researchers call, a “super entity.”

4 Dec 2013

Are our banks really safe?

The world banking system could come crashing down around our heads again – even worse than in 2008. Giant banks apparently learned very little from the earlier collapse. Many of them are carrying on the same overly risky and even illegal activities that led to the earlier crisis.  (Part 1 of a series)

If Canada’s banking regulations are not substantially toughened by the time the next global financial crisis hits – yes, there will be another crisis – our Big Six banks may very well find themselves in serious trouble. Again.

The public is almost entirely unaware that our banking system, with just a couple of wrong moves or some bad luck, could go into a tailspin at any time. And when the next serious setback occurs, we could end up suffering even more than in 2008-2010.

Throughout the Great Recession, Finance Minister Jim Flaherty and the financial community managed to keep secret the fact that our largest banks were in financial difficulty. Had people known the reality, they might have wanted their money back.

11 Nov 2013

Globe's article on income gap
really propaganda

McKenna - My sacrificial lamb.
Journalist Barrie McKenna, writing in the main hyped-up article in the Globe’s Focus section on November 9.13, talks about how the gap in income between the rich and the rest of us is a serious problem that will hurt Canada for generations to come. True.

However, McKenna presented the issue as though we had just learned about the income gap. The frustrating truth is that we have known for years that the changes the Conservatives and the Liberals before them were making to the tax system, plus other adjustments, was resulting in much greater income disparity and the hollowing out of the middle class.

In fact, even the conservative Conference Board of Canada recognized this as a problem 20 years ago!

The article’s weaknesses are glaring. This is particularly significant because McKenna’s article launched a two-week-long series under the topic, Canada’s Wealth Paradox series.

McKenna makes no effort to explain WHY the wage gap is still increasing. He throws around terms such as globalization as being part of the problem, but he does not explain WHY we have such serious incomes gaps.

Income disparity doesn’t just happen

1 Sep 2013

Article touches on sensitive union issues

Should union members give up some of their seniority rights to make the movement more appealing to a critical public?

This is one of the controversial points touched on by an Ontario union rep, Glenn Wheeler, in an article in The Toronto Star

Wheeler also questions whether unions are spending too much money on grievances. 

Are the points raised by Wheeler things the union movement should deal with to try to drag itself into the 21st Century?

Wheeler is the Ontario legal rep. for the Canadian Office and Professional Employees Union, and a former journalist with NOW magazine. 

Reprinted below is The Toronto Star article. I'm interested in your feedback.

2012 Labour Day Parade in Toronto

Unions need to get back in touch
By Glenn Wheeler
Chances are, the turnout at this year’s Labour Day parade tomorrow will be heavy with the usual suspects — stewards, union presidents and others of the committed — and light on ordinary workers.
While we unionists squawk about how Stephen Harper and his ilk are beating up on us, we scratch our heads at the extent to which our existing members have tuned us out.
Faced with the dwindling participation of our members, we resort to dolling up our websites and scheduling bargaining unit meetings for lunch time rather than the end of the day, when there’s nothing in the way of the member and the exit.
But the causes of the disengagement — and the responses to it — are more profound. Unions still have not figured out how to effectively translate the benefits of collective action to the individualistically inclined members of the iPhone generation.
We still have not found a compelling answer to the question “what have you done for me lately?”

13 Aug 2013

Austerity chokes Canada's down-and-out
as Harper, Flaherty look the other way

The exceedingly aggressive austerity cuts carried out by Prime Minister Stephen Harper and Finance Minister Jim Flaherty over the past seven years have come home to roost as millions of Canadians, depressed and without hope, are succumbing to its worst consequences.

Program cuts and tax reductions for corporations and the wealthy have had a huge, disproportionate impact on the poor, working poor, underemployed, and those with health problems including mental illness.

It's hard to say who is the meanest -- Harper or Flaherty.

The massive austerity program translates into less income, decreased services, and reduced health care for many of Canada's most vulnerable people. It appears that more than 3.5-million Canadians - mainly the poor, the unemployed/underemployed and the under-privileged - are struggling.

Independent economists argued that the austerity program
was not achieving its stated goal of preparing the country
for an economic recovery, but Jim Flaherty refused to budge
The attacks on the vulnerable began soon after the Conservatives came to power in 2006. They launched cuts that were a broadside attack on the government's ability to finance many of its activities, including these much-needed employment and social support programs.

16 Jul 2013

Conservatives exploit Afghan deaths,
but treat vets like 2nd class citizens

A travelling tribute to the men and women who lost their lives in Afghanistan will arrive in your province or territory during the next year or two. The memorial, featuring plaques of the 161 Canadians killed, will be welcomed by their families and friends, but some of us will react much differently.

Former National Defense Minister Peter MacKay unveiled the temporary display in Ottawa on July 9th. It will be open to the public and remain on Parliament Hill through Remembrance Day, before heading off on a two-year journey across the country to visit provincial legislatures and then on to Washington.

The memorial appears to be straight-forward but, in reality, it carries with it a heavy dose of hypocrisy regarding the Conservatives' real objective of the tour and their treatment of military veterans.

The main goal of the memorial is not so much to honor those killed but to have the display instill into Canadians the idea that the Tories command a modern-day fighting machine ready to join others to defend "freedom" wherever necessary. To clearly link us to the prowess of the Americans, the display includes plaques of the 40 U.S. military personnel killed while under Canadian command in Afghanistan.

25 Jun 2013

Corporate money preventing all-out
campaign to stop global warming

Highly-regarded former Toronto Mayor David Miller says he is "very excited" about becoming the new President and CEO of the World Wildlife Fund-Canada in September.

"They've made such a difference," Miller told The Toronto Star, "and to be part of an organization that knows how to make real change is a unique opportunity."

But there are questions about whether the WWF is effective in its work and, moreover, why the WWF and other members of the global environmental movement have made such little progress combatting the most serious threat to earth - climate change.

The magnitude of the crisis facing humankind cannot be overstated. More than 400,000 people are dying each year, and, a confidential report from the United Nations said that three years ago corporations caused $2.2-trillion damage to the environment.

5 Jun 2013

It's high time the Liberals or NDP challenged our 'corporate elite'

With the next federal election a little more than two years away, it is time we started asking the Liberals and New Democrats what kind of government they will deliver if either one could bounce the Conservatives from power.

It would be unwise to underestimate the Conservatives’ devious political smarts, but it increasingly looks like we may have a dramatic change in Ottawa – perhaps a Liberal government.

A win for either the Liberals or NDP will be a tremendously important change, but the winner should also be able to deliver a new kind of politics.

21 May 2013

Action needed to stop 'climate deniers'
from winning the information war

Note: This appeal is written particularly for the attention of environmental groups and activists throughout Canada and the U.S., suggesting they set up a co-operative system to bring a halt to the huge amount of disinformation about global warming that appears in mainstream media.

The global warming deniers are at it again, and it is high time that the environmental movement in Canada and the United States launched an organized campaign to expose these scientific community charlatans.

The mainstream business media, which bows to corporate interests in both countries, is quick to publish interviews and opinion articles by the tiny percentage of scientists who deny that global warming exists. Some say that it has not been proven that human activity damages the environment. Some bizarrely claim that emissions of carbon dioxide are beneficial to the planet.

13 May 2013

Business journalists go on the attack;
demonize Atlantic seasonal workers

National business journalists and columnists have bought into Prime Minister Stephen Harper’s demeaning view that folks in the Atlantic region are backward and have a defeatist attitude. Framed in disrespectful language, they’re promoting untested economic ideas that, if adopted, would seriously damage the economy – and the people – of the region.

Apparently it wasn’t enough for elite business journalists to applaud how Harper has made life far more difficult for many already struggling seasonal workers by cracking down on employment Insurance (EI). They are advocating the elimination of EI for all 102,000 seasonal workers, people who are employed in the fishery, forestry, agriculture and tourism industries, etc.
 “. . . there is no justification, in logic or in economics, for seasonal EI,” wrote Globe and Mail contributor and former Nova Scotia restaurateur Brian Lee Crowley, “and the dogged pursuit of this policy flies in the face of the interests of Canada and people who become trapped in the cycle of working seasonally and then receiving EI benefits while unemployed.” 

7 May 2013

Great minds agree on petitions....

Someone else agrees with me that petitions don't work - unless they're part of a larger campaign.

I wrote about this in my post... Petitions next to useless in campaign to defend CBC

6 May 2013

Petitions next to useless
in campaign to defend CBC

At least half-a-dozen petitions aimed at stopping Stephen Harper from taking control of the CBC are buzzing around the Internet. Pressure groups are putting a lot of effort into this campaign, but the question is - does sending petitions to Ottawa have any effect on the Conservatives. Are they just wasting everyone's time?

The many petitions contain all the right language:
"Prime Minister Harper is using his latest budget bill to seize unprecedented power over the CBC," say Friends of Canadian Broadcasting and LeadNow in a joint appeal. "Independent public media is a cornerstone of a healthy democracy, and we cannot stand by and let the CBC be silenced and controlled for partisan political gain."
"The government would be able to have dictatorial control over the terms and conditions of employment of non-union staff -- and any collective bargaining among unionized staff -- at the CBC and Radio Canada," says a petition started by SumOfUs.

30 Apr 2013

Network formed to take on Harper
not living up to its potential

Ever since Stephen Harper took over in Ottawa seven years ago, Canada has needed a strong and powerful social/political movement to stop, or at least slow down, the many destructive measures being carried out by the Conservatives.

Finally, in September, 2012, Common Causes, a loosely-knit network of more than 50 groups from the non-governmental sector (NGO), labour and the Native community, was born.

The idea was to have dozens of groups come together under one communications umbrella where they could work together on common-interest projects to oppose the Harper regime.

The creation of Common Causes gave me hope. I have long felt that we desperately need a hard-nosed civil society movement that will challenge the Conservatives with massive campaigns drawing on the resources of hundreds of groups.

22 Apr 2013

Pension funds and church rebel
over excessive corporate salaries

A shareholder revolt at struggling Barrick Gold, the world's largest gold producer, will hopefully lead to protests that will encourage the Canadian government and business to introduce limits on out-of-control executive pay.

The public just learned that Barrick paid an enormous signing bonus of $11.9-million to high-flying international executive John Thornton, its new co-chair, last year. His total compensation for 2012 was a whopping $17-million.

10 Apr 2013


I have written this piece in an attempt to evaluate the actual contribution to society of a prominent Canadian who espouses extreme right-wing views. I feel it is important, from time to time, to compare actual performance to stated principles. If you find this critique of interest, please send the link to others.   Nick

One of the champions of Canada’s right-wing corporate elite is finally calling it quits.

Gwyn Morgan, 66, is stepping down in May as Board Chairman of SNC-Lavalin, the troubled, giant engineering and construction firm trying to survive a series of scandals, a lack of public confidence, and fluctuating share values.

3 Apr 2013

How should we remember Ralph Klein?

Condolences and praise poured in for former Alberta Premier Ralph Klein, who passed away on Friday, March 29, at the age of 70.

"We remember what a force of personality he was, how driven he was, how motivated he was, how straightforward he was, and that we trusted him implicitly.” – Alberta Premier Alison Redford

“While Ralph's beliefs about the role of government and fiscal responsibility were once considered radical, it is perhaps his greatest legacy that these ideas are now widely embraced across the political spectrum." -- Stephen Harper.

Yes, as the compliments poured in, it must be remembered that Klein was one of Canada’s most aggressive neo-liberals. “King Ralph”, as he was widely known, served as premier of Alberta from 1992 to 2006.

27 Feb 2013

'Freedom to Read Week' right time
to assess corporate media censorship

I’ve been deeply involved in journalism for 40 years, and I’ve never experienced a time like this when mass media corporations are feeding us such distorted, one-sided news and opinion.

Corporate media is helping to facilitate a total change in the ideological fabric of the county into a nation of mean-spirited people who are starting to believe that extreme right-wing policies are the only solutions to our problems. Left behind are compassion, a sense of what’s in the public interest, and social justice.

The just-released Focus Canada survey by the Environics Institute documents in grim detail how the Harper agenda – which is supported by corporate media – is way out of line with the country the majority of Canadians want.

14 Feb 2013

Liberal leadership candidate Murray
wants to gang up on the Conservatives

If you want to see the Harper Conservatives defeated in 2015 – or at least reduced to a minority government – it’s time you started paying attention to what Joyce Murray is saying.

Murray is a Liberal leadership candidate from B.C., and the only candidate promising one-time co-operation with both the NDP and Greens to defeat Conservative candidates in a number of key ridings in the next election.

Murray, who has been a federal MP for five years and earlier a Liberal cabinet Minister in B.C., also supports proportional representation (PR) – a method of electing Members of Parliament that would abolish the archaic first-past-the-post system that allowed Harper to win a majority in 2011 with only 39 per cent of the popular vote.