Blockchain could revolutionize global banking

The era of globalization is drawing to a close. Evidence of that has been made clear by President Trump’s withdrawal from global affairs, his attempt to build an economic and physical wall around the United States. It’s a clumsy attempt to express the genuine concerns of Americans who have been left out of the prosperity reaped by a few.

     image: Urban Forex

Two billion people around the world have no access banking. They are unable to make loans to start small businesses; they have no credit, and no means of sending or receiving money.

And the rest of us have is rigged banking system. We are nickeled and dimed in every banking transaction and pay exorbitant interest rates on credit cards.

We are told that a healthy banking system is fundamental to a healthy economy. Yeah, right. Banking funnels money into the pockets of the rich who have so much that it just lays around in piles, uninvested, while worthwhile social programs and enterprises go threadbare.

When U.S. banks failed during the Great Recession of 2008 -because of bad business practices- they were bailed out with taxpayer’s dollars. They were rewarded for bad investments while homeowners who couldn’t pay bank-approved mortgages were thrown out on the street.

Not only is there an asymmetrical relationship between banks and clients in terms of wealth distribution, there is also an imbalance of transparency. While banks know exquisite details about us, we know practically nothing about them. Social scientist Shoshana Zuboff calls this one-sided, extractive interaction “surveillance capitalism.”

The technology of blockchain holds promise to restore balance and eliminate excessive fees through use of a universal digital currency, or cryptocurrency.

The first digital currency, Bitcoin, leaves people wondering. It has a reputation of being highly speculative.  But there are many versions of cryptocurrencies that would work and many possible versions of blockchains –the digital ledger which records transactions.

The advantages of cryptocurrencies over banking are that your money is held in a digital wallet and easily accessed; credit card payments are quicker and less expensive; you remain relatively anonymous (pseudonymous) with minimal information shared; you are the master of your money, there are no banks or boundaries to the flow of money.

If it all seems to be too good to be true, there are hurdles. One is just who controls access to your digital money. If banks control applications that access cryptocurrency wallets, we can expect business as usual. Cultural anthropologist Natalie Smolenski explains:

“This is the crux of blockchain’s catch-22: the public won’t use blockchains without user-friendly applications. But user-friendly applications often achieve that ease through centralization, which replicates the conditions of control that blockchains sought to circumvent (Scientific American, January, 2018)”

A new era would bring public control of cryptocurrencies. As Bitcoins have demonstrated, we already have a blockchain that is open-source and maintained by a global network of volunteer core developers. We have a network of individually-owned computers that process the indelible transactions –a process called “bitcoin mining.”

“Creating digital identities whose existence is independent from governments and corporations is the next grand challenge that blockchains both pose and could help solve,” says Smolenski.

With the dawn of the era of a “Universal New Deal,” cryptocurrencies could redistribute wealth and put money in the hands of those who will spend it.


The titans of technology have feet of clay

Technology seems unstoppable. The accumulated wealth of the Big Five: Apple, Alphabet (Google’s parent company), Microsoft, Facebook and Amazon, have a combined value of $4 trillion. That’s more than twice Canada’s annual GDP.

     image: Minneapolis/St.Paul Business Journal

Wall Street also looked unstoppable before the crash of 2008. Cryptic investments made amazing returns but finance wizardry also has feet of clay. Conor Sen, business columnist for Bloomberg Views, summarizes that vulnerability:

“Markets became irrational about how profitable the financial sector could become relative to the underlying economy, and in response to these market pressures, finance came up with increasingly elaborate schemes to make money that weren’t sustainable (Globe and Mail).”

Facebook and Google have the advertising world wrapped up. The clever duo don’t have to hire reporters to dig up news because users generate their own content.  Facebook and Google and benefit in three ways: by encouraging users to generate content, collecting detailed profiles of users, and then selling advertisements to those very users. Users happily post pictures of adorable kittens, videos, inflammatory and sometimes interesting comments (but not much actual news).

While Facebook and Google couldn’t care less about the loss of newspapers and other news sources, they should be worried about the financial health of their advertisers. Companies can afford to advertise only because they are viable. Amazon is profitable because third-party vendors choose to sell on Amazon.

“In other words,” says Sen, “for the most part, the big five tech companies exist at their current size and scale only because they serve a larger underlying economy of profitable companies.”

Tech giants exist in an economic ecosystem. There has to be a balance between the top predators and the health of the ecosystem which they feed. There’s going to be trouble for the big fish once the little fish stop feeding them.

Tech giants don’t just suck only advertising revenue from traditional sources. They also provide services that didn’t exist when newspapers ruled; like the cloud computing services provided by Amazon, Google and Microsoft. Cloud computing also depends on a viable economy.

The titans of technology could harm the very businesses they depend on. For example, Blue Apron, a meal-delivery company, has been a prolific online advertiser. What if Amazon were to establish a company and put Blue Apron out of business? It’s not inconceivable. Last year, Amazon bought Whole Foods for $17 billion and even the world’s biggest retailer Walmart took notice. Target is cutting advertising to stay in the game.

Fossil Group has been struggling lately. Sales of their watch have been dropping, perhaps because of the popularity of Apple Watch. If Fossil Group starts to cut back on advertising, Facebook and Google would lose ad revenue. Amazon would lose sales of the Fossil watch as well.

Owning a newspaper used to be a licence to print money. The marriage of news and advertising seemed solid. Now readers get “news” from the internet. Selling advertising on a medium where the content is generated by the target audience seems like a sure thing.

Amazon, Google and Facebook have a parasitic relationship to the economy. Other than advertising and marketing the products of others, their contribution to the economy is minimal.

Blockchain could improve food security

The future of cryptocurrencies such as the bitcoin might be unclear but the technology behind it is solid. Blockchain is the digital ledger where bitcoin transactions are kept. It’s transparent, secure and open for all to see.

    image: Realty Biz News

The origin of blockchain is mysterious. Some person, or group, with the anonymous name Satoshi Nakamoto is credited with inventing blockchain. Who this person is remains obscure.

Blockchain’s usefulness goes beyond cryptocurrencies. Its property of transparency could improve food security. Sylvain Charlebois, professor in food policy and distribution at Dalhousie University explains:

“Blockchain technology allows for users to look at all transactions simultaneously and in real time. In food, for example, a retailer would know with whom his supplier has dealt. Additionally, since transactions are not stored in any single location, the information is almost impossible to hack (Globe and Mail, December 13, 2017).”

If you are buying pork chops in a grocery store, for example, and wanted to know the complete history the animal before you buy, you could scan the QR code on the label and within seconds know the date of the animal’s birth, use of antibiotics, vaccinations, and where the animal lived. (QR codes are a type of bar code in the shape of a square.)

The Public Health Agency of Canada reported earlier this month that 21 people became sick after eating romaine lettuce. While PAHC knew what caused the illness (E. Coli 0157) they didn’t know where the lettuce came from. Tracing contaminants can be a matter of life and death.

“Every year, more than four million Canadians get food poisoning. In recent years 474 cases of [the deadly disease caused by E. Coli 0157] have been reported annually,” says

Big Food is considering blockchain as way of tracing contaminates. Wal-Mart sells 20 per cent of all food in the U.S. and tested blockchain compared to standard methods of tracing food. They traced the source of mangoes in one of their stores using the standard method and it took six days, 18 hours, and 26 minutes to trace the fruit back to its original farm. Using blockchain technology, it would take 2.2 seconds for anyone –consumers and suppliers alike- to find out anything they want. And it would prevent good food from being thrown out.

“During an outbreak of a food-related health scare, six days is an eternity,” says Prof Charlebois, “A company can save lives by acting quickly. Blockchain also allows specific products to be traced at any given time, which would help in the reduction of food waste. For instance, contaminated products can be traced easily and quickly, while safe foods would remain on the shelves and not in landfills.”

Blockchain won’t be implemented without the involvement with everyone along the food chain. The record will only be as good as the data entered. Giants like Wal-Mart can force supplier participation.

Governments could also force compliance. With the health of consumers at stake, regulated participation would make the records complete and useful.

Cryptocurrencies may be a fleeting gimmick to have investors part with their money but let’s not throw the blockchain out with the bitcoin.

My beef with Canada’s new food guide

Canada’s new food guide is being influenced by agencies whose chief focus is the consumption of their products, not our health. Food industries and a branch of government, Agri-food Canada, are resisting proposed changes by Health Canada.

     Proposed food label. Image : Globe and Mail

Health Canada wants the new food guide to “shift towards more plant-based foods,” less red meats, and to limit “some meats and many cheeses” high in saturated fats.

These are sensible recommendations but not what Agri-food Canada wants. They are in the business of promoting the sale of red meat and dairy industries. AAFC officials wrote a memo marked “secret” in which they worried:

“Messages that encourage a shift toward plant-based sources of protein would have negative implications for the meat and dairy industries (Globe and Mail).”

Yes they would have negative implications but the health of Canadians trumps the meat and dairy industries.

Canada’s food guide is widely respected. Seventy-five years after its first launch, it’s the second most requested government document after income-tax forms. It’s distributed to dieticians and doctors for patient advice, and to schools and hospitals for creating meal plans. The new guide will be around for a long time, so it’s important to get it right.

The current guide, revised in 2007, had a number of flaws. It recommends juice as a serving of vegetables and fruit. It recommends two servings of “milk and alternatives” and two servings of “meat and alternative.” Juice is not a substitute for whole fruit and vegetables. Too much red meat and saturated fats are unhealthy.

There are problems with the “Nutrition Facts” label as well. The serving size is not standard so that breakfast cereals, for example, may appear to have similar calorie content but, in fact, differ because the serving sizes vary.

Health advocates recommend that the new Nutrition facts label be moved from the back to the front of the package, and that foods which are high in salt, sugar, or saturated fats have a “stop” or “yield” sign. At a meeting with Health Canada in September, food and beverage industry reps were furious. They called the warning a “big, scary stop sign,” and that the signs were overly simplistic. They prefer detailed labels on the back rather than blunt symbols on the front. A lawyer for the food industry argued that Health Canada was not giving Canadians the respect they deserve: “They’re not idiots.”

Canadians are not idiots but they’re not nutrition specialists either. The food industry would rather have detailed specifications on the back because many shoppers find them hard to interpret.

The food industry complains that plain symbols like stop and yield signs would make consumers think they are “like a chemical warning sign.”

But warning symbols are appropriate because some foods are unhealthy. More than one-fifth of Canadians are obese. Diet-related chronic illness costs our health care system $7 billion a year. Heart disease and stroke are the leading cause of death.

Under the Harper government, the AAFC held sway. When Health Canada wanted to revise the guide back then to “choose local or regional foods when available,” the AAFC vetoed it. We’ll see how determined the Trudeau government is in shaping a healthy food guide. Will the government defend the health of Canadians or the food industry?

Local content on the new aether

Medieval scientists believed that radio waves were carried through a medium they called the aether. Seems sensible. If sound waves require a medium, why not radio waves? It turns out that radio doesn’t need a medium; a vacuum will do nicely.


     radio waves

The internet is the new aether. The “network of networks” depends on wires and optical fibers to carry signals. The internet wouldn’t exist without it (Wifi is radio but it’s just a connection to the internet).

We straddle both worlds –ethereal radio waves surround us while the internet remains wired. If I put up an antenna, I can receive CFJC TV for free. I chose to pay Shaw cable to have the station delivered to my house.

The internet is as disruptive as early radio and TV was and its role is still being defined. Is the internet a broadcaster? If CFJC is a broadcaster and if I can receive the same station over the internet, it would seem like it.

Not so. In 2012, the Supreme Court of Canada heard arguments from program producers that cable companies were broadcasters. The court agreed with cable companies that they were not.

It’s not trivial matter. If traditional TV stations are broadcasters and cable companies are, then the cost of production local shows and news has to be paid for by the TV stations –they receive nothing for the signals that cable carries.

It’s a problem in small cities like Kamloops because local news and programming is expensive to produce and ad revenue is not as high as large cities.

In the past, cable and satellite companies have grudgingly paid into temporary funds to support local programming but it’s a constant battle. This has left small markets scrambling to make ends meet.

Local news is vital. It not only informs the community it serves, reflects its values, and is vital in emergencies. Rick Arnish, Chair of the Small Market Independent Television Stations Coalition (SMITS), was a strong advocate of local TV before retiring. He also supported free over-the-air TV for people who can’t afford cable. He made that clear in his letter to the Canadian Radio-television & Telecommunications Commission in 2015:

“Over 95% of the participants who posted comments on the topic of over-the-air television in the online consultation held during Phase 3 referred to the importance and value of the ability to receive television programs inexpensively over the air and opposed proposals to shut down transmitters. Canadians value local news, with a CRTC commissioned poll putting the number who consider it ‘important’ at 81%.”

Arnish also made clear that cable companies should share the cost of local TV if small stations are to survive.

“Moreover, all things being equal, with the phase out of LPIF [Local Programming Improvement Fund] now complete, the SMITS Coalition stations as a group will be in the red this broadcast year, given the loss of the $5.4 million contributed by LPIF last year.”

Before retiring last year, Arnish was Program Director at CFJC TV and General Manager of Broadcast Centre and later President of the Jim Pattison Broadcast Group.

The internet transmits the content from traditional sources without paying for its creation. Unlike the old aether which radiated local programming, the new aether sucks the life from local TV.

The bitter side of honey

Becoming bee friendly is a good first step for the city. Now Kamloops needs to become honey friendly.

Bee City Canada

Bee City Canada

Canadian and American consumers are getting stung with fake honey. Much of comes from China, the world’s largest honey producer but you wouldn’t know it. Chinese honey is being laundered.

The label rarely says “made in China.” Instead, it will show the country of origin as being from countries like Indonesia, Malaysia, and Taiwan: suspiciously, places that ordinarily don’t produce much honey.

An investigation by the Globe and Mail found that Chinese producers export cheap and often contaminated honey to countries mislabelled as molasses, fructose or glucose syrup so customs officials don’t become suspicious.

The Chinese honey is filtered to remove any soil or pollen that would identify the county of origin and exported to countries around the world.

Worse still, the Chinese honey may be contaminated with antibiotics and adulterated with sugar:

“Most honey comes from China, where beekeepers are notorious for keeping their bees healthy with antibiotics banned in North America because they seep into honey and contaminate it; packers there learn to mask the acrid notes of poor quality product by mixing in sugar or corn-based syrups to fake good taste.”

The importation of fake and imported honey leaves a bitter taste in the mouth of Neil Specht. The Saskatchewan honey producer has seen the price of honey drop from $2.43 to $1.11 a pound last year due to the flood of imported honey into Canada.

“There are few, if any, honey producers that can operate at $1.11 per pound,” Specht told Walrus magazine. “I would suspect the costs of production for most are in the $1.60 to $1.65 range.”

Specht had a bumper crop last year, more than 500,000 pounds, and he’s not sure what to do with it. He could sell it at a loss or keep it in hopes that prices will improve. He normally sells his honey to the Western Canadian co-operative Bee Maid.

Consumer confusion over labelling doesn’t help. When buyers see “Canada No. 1” on a label, they think it’s produced in Canada. But that is just an indication of grade, not country of origin. Fine print may reveal the true source.

Canadian honey producers are understandingly upset. Manitoba bee keeper Allan Campbell alleges that Canada’s largest honey packer, Billy Bee, is marketing their honey as pure Canadian while as much as one-half of the contents may imported. Spokespeople for Billy Bee deny this, insisting that their honey is eighty-five per cent Canadian. Billy Bee brand is a blend of Canadian and Argentine honeys while their Natural Honey Farms brand contains honey from China.

It’s well and good for Kamloops to promote healthy ecosystems for bees; they pollinate much of the food we eat. However, the honey they produce is worth protecting as well. I don’t mean just the honey bought at Kamloops’ Farmers Markets, which I would think is pure Canadian, but also the honey sold on grocery store shelves.

The bee-friendly brand is cute but the hard work is lobbying governments to remove deceptive labelling so that it’s clear what consumers are buying in bee-friendly Kamloops.

Seeing red in food dyes

They have no nutritional value; they are completely unnecessary; and they are harmful to health. Yet food dyes are added in growing amounts.

Blue #1 and Blue #2 banned in Norway, Finland and France,

Blue #1 and Blue #2 banned in Norway, Finland and France,

If you read food labels, as I do, you won’t necessarily find them listed.  Health Canada reluctantly allows dyes to be labelled as “colours,” which obscures what they really are.

“Regulations provide food manufacturers with the choice of declaring added colour(s) by either their common name or simply as ‘colours’.”

I say reluctantly because Health Canada recognizes that current labelling is a problem. They would prefer that all colours be listed by their common name or by the Colour Identification number. And they want natural colours, which can cause allergic or sensitivity responses, to be listed as well.

To get some idea of what such labelling might look like, the European Union has the following regulation in place since 2010.

“This regulation requires that the synthetic colours sunset yellow (E110), quinoline yellow (E104), carmoisine (E122), allura red (E129), tartrazine (E102), and Ponceau 4R (E124) be labelled by their common names or E numbers in the list of ingredients along with the following warning statement: ‘may have an adverse effect on activity and attention in children’.

What was once only suspected is now confirmed beyond a reasonable doubt. Since the 1970s, more than 30 studies have been conducted on the adverse affects of dyes. Two large studies done in the United Kingdom found that they affect the behaviour of children in the general population.

When food dyes are eliminated, adverse behaviour is reduced in children. A report from Center for Science in the Public Interest released earlier this year states:

“The mounting evidence has led to a growing consensus among researchers, physicians, psychologists, and others who treat patients with such behavioural disorders as attention deficit hyperactivity disorder (ADHD) that avoidance of food dyes benefits some children.”

The dyes in just a single cupcake or glass of Kool-Aid can be enough to prompt adverse behavioural reactions in some children. If the U.S. numbers are projected to Canada, fifty thousand children suffer adverse behavioural reactions after ingesting food dyes with a cost of hundreds of millions to our health care system.

The United Kingdom regulates dyes in foods, especially those which appeal to children. Take McDonald’s Strawberry Sundae, for example. In the UK the ingredients are Strawberries (38%), Sugar, Glucose, Syrup, Gelling Agent (Pectin), Acidant (Citric Acid).  In the U.S., the percentage of strawberries is not shown and while the other ingredients are similar, Red 40 has been added.

The food industry likes food dyes because they can reduce or eliminate any natural ingredients without any change in appearance.

The harm to children and the costs to society from dyes are needless and preventable. If Health Canada recognizes food dyes as being harmful, why hasn’t the Government of Canada acted on their concerns? The short answer is that the Government of Canada during the Dark Decade preferred to let industry regulate itself.

Elimination of harmful food dyes is just one more things on the current government’s to-do list. No doubt Canadians will have to remind them of their duty to protect the health of children.