BC Liberals suppressed Hydro rate hikes

For decades, B.C. governments have hidden the true cost of Hydro rates -especially the BC Liberals.

image: Common Ground

Under the direction of the BC Liberals, the Crown utility used “inappropriate” accounting to pile $5.5-billion in what are known as deferral accounts says B.C.’s auditor-general.

“That debt amounts to $1,300 for every residential customer, more than $10,000 for each commercial and light industrial ratepayer, and almost $5-million for each large industrial consumer,” according to the Globe and Mail, February 7, 2019.

Deferral accounts are not improper when correctly accounted for. They can be used as a temporary measure to avoid the shock of sudden rate hikes. After rates are gradually increased, the deferral account can be paid off.

But that’s not what happened. To keep voters happy and to make governments popular, BC Hydro rates were kept artificially low leaving future governments to deal with the problem of billions hidden in deferral accounts.

“BC Hydro was not allowed to charge its customers enough to cover its operating costs each year,” Auditor-General Carol Bellringer wrote.

The current minister responsible for BC Hydro, Bruce Ralston, said his government is committed to fixing the problem but it will take time given the size of the debt. “We are going to keep rates affordable. No one’s rates are going up by $1,300 in a year.” His government has already reduced the deferral accounts by $950-million by bringing that debt onto government books.

The NDP government also intends to prevent misuse of deferral accounts by future governments by restoring the role of the independent regulator, the BC Utilities Commission (BCUC) and ensuring that BC Hydro adopts ordinary accounting practices.

Industries who are used to cheap hydro are not happy with the prospect of paying the real cost of producing electricity. Industry representative Richard Stout says industrial customers shouldn’t absorb the shock of getting Hydro back on sound financial footing. Since the government is responsible for the mess, they should pay:

“I think most would agree the appropriate source of paying down the debt should be from government, rather than the ratepayer.”

Huh? He wants taxpayers (the government) to pay for the meddling of former governments rather than ratepayers? Last time I looked Hydro users and taxpayers were one and the same.

Critics of BC Hydro will point to the debt incurred in building the massive hydro dam at Site C as an additional source of the problem. The project was started by the BC Liberals and given green light by the NDP who said the project had gone too far to abandon.

The government is faced with a hard choice, says Bellringer: “You can either have a rate increase or you can end up with a deficit that ends up getting covered by the government at some point.”

Hiding Hydro debt, which in reality is our debt, is not an option.

Transferring BC Hydro’s debt to the government’s books is the right thing to do but government debt is not popular with voters because it’s visible. Turning control of BC Hydro over to an independent regulator is the right thing do but hydro rates will go up.

We’ll see if doing the right thing pays off for the NDP in the next election.

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Immigration is shaping up to be an election issue

Immigration could be a toxic issue in the upcoming October federal election.

image: realtimetrump.com

Just the talk of anti-immigration by politicians is enough to trigger attacks on some of society’s most vulnerable members.

When presidential candidate Donald Trump campaigned against immigration, the effect was immediate. Thugs took to the streets. Hate crimes went up 20 per cent in Chicago, 50 per cent in Philadelphia, and 62 per cent in Washington DC. After Trump’s election, the hate crimes continued (hate crimes include attacks against all identifiable groups, not just immigrants.) According to a study from the Center for the Study of Hate and Extremism from California State University, the effect persisted after the election with a 13 per cent increase in hate crimes across America’s ten largest cities.

The Conservatives are gearing up the anti-immigration issue. After the Parliamentary Budget Officer warned that asylum-seekers walking across the Canadian-U.S. border at “unauthorized points” could cost the federal government more than $1-billion over three years, Conservative leader Andrew Scheer immediately tweeted: “Parliamentary Budget Officer: Illegal border crossings cost Canadian taxpayers up to $34,000 per person.”

Scheer ramped up the talk further by saying he strongly opposed Mr. Trudeau’s intention to sign a UN agreement on a multinational approach to migration, saying – ominously but incorrectly – “it gives influence over Canada’s immigration to foreign entities.”

Frank Graves of EKOS and Michael Valpy from the University of Toronto wonder who’s buying this talk: “So why is this happening? For whom is Mr. Scheer beating the drum? (Globe and Mail, December 18, 2018).”

There has been a shift in public opinion on immigration, perhaps fuelled by anti-immigration anger in Europe and the U.S. and rage-about-everything on social media.

Frank and Valpy are puzzled: “On the suddenly inflammatory topic of immigration, Canada has become a paradox.”

In ordinary times, Canadians support immigration. But peel away the anti-immigration rhetoric and you find racism at its core. EKOS research indicates that on the surface, rationales are sensible. Canadians favour immigrants that arrive in an orderly fashion, as opposed to those who arrive unannounced at borders or walk across the border, by ten percent. Not a great difference when you consider the attention that border-crossers get. However, when researchers asked whether they’d prefer to live beside a white newcomer from Europe or brown or black newcomers from somewhere else, “the differences balloon to 200 to 300 percentage points.”

Conservatives tapped into this irrational fear of the other when they ran an ad depicting a black man walking toward the border with his suitcase on little wheels from the U.S. They withdrew the ad but the message lingers: dark-skinned immigrants are scary.

Will racism disguised as anti-immigration bring the Conservatives to power? They will have to tap into fear in supporters from other parties. As it now stands, 40 per cent of Canadians think there are too many visible minorities being admitted to Canada. Of those, 65 per cent identify as Conservative supporters, 20 per cent as New Democrats, and 13 per cent as Liberals.

Perhaps the Conservatives can recruit the fear-mongers organized on Facebook under the banner of “Yellow Vests Canada” which has 107,000 members.

 

China “understands” the developing world

China is taking a page out of the American playbook in their massive global investment called the Belt and Road Initiative (BRI).

Image: Wikipedia

“Belt,” is short for the Silk Road Economic Belt and refers to the overland routes for road and rail transportation; “road,” is the 21st Century Maritime Silk Road referring to sea routes.

In America’s version, the Marshall Plan, they invested $100 billion in the war-torn regions of Europe after the Second World War. The stated goals were to remove trade barriers, modernize industry, and improve European prosperity.

The unstated goals of the Marshall Plan were to establish an economic presence in Europe. The Soviets understood this. Soviet Foreign Minister Vyacheslav Molotov, in opposition to the plan in 1946, said: “If American capital was given a free hand in the small states ruined and enfeebled by the war [it] would buy up the local industries, appropriate the more attractive Rumanian, Yugoslav … enterprises and would become the master in these small states.”

According to China’s official newspaper, the People’s Daily, the goals of the Belt and Road Initiative are: “To construct a unified large market and make full use of both international and domestic markets, through cultural exchange and integration, to enhance mutual understanding and trust of member nations, ending up in an innovative pattern with capital inflows, talent pool, and technology database.”

It’s the largest infrastructure project ever with $1 trillion designated for South-east Asia, Eastern Europe and Africa. The plan is expansive. It includes 71 countries that account for half the world’s population and a quarter of global GDP.

Western countries worry about ulterior motives. Jonathan Hillman at the Center for Strategic and International Studies in Washington says: “It’s a reminder BRI is about more than roads, railways, and other hard infrastructure. It’s also a vehicle for China to write new rules, establish institutions that reflect Chinese interests, and reshape ‘soft’ infrastructure.”

Martin Jacques, former editor of Marxism Today is less suspicious. He thinks China is developing sources of commodities in Africa so developing nations can improve their economies and be less dependent on Western demand.

“Secondly,” says Jacques, “and this is why I deeply resent the argument that China is the new colonial power in Africa, China understands the problem of developing countries. One of the big problems is developing infrastructure that delivers transportation, energy and the necessary building blocks of a more developed economy (New Internationalist, July/August, 2018).”

Maybe China can do global supremacy better than the Western world. Resource extraction by Canadian mining giants in Africa has been less than stellar. At a tantalum mine in central Mozambique owned by Pacific Wildcat Resources based in Vancouver a man was shot and killed, inciting community members to set some equipment ablaze. At the Montréal-based Kiniero mine in Guinea, the military killed three in a bid to drive away small-scale miners away. Soldiers also shot a woman and burned her baby

While American foreign policy amounts to bluster and bravado, China is climbing to superpower status by integrating itself into local economies. China will inevitably make mistakes but the Belt and Road Initiative is more systematic than the Western World’s haphazard corporate colonialism.

The U.S. talks tough about China but they can no more stop China’s ascendancy than they can stop the sun from rising.

 

 

Redefining pro-life

The hardening of abortion into the pillars of political parties is showing fractures.

image: Heidi Will

Whether abortion is a human right belonging to a woman or a human right that belongs to the foetus used to be a philosophical and religious debate. Now it’s about politics. Republicans in the U.S. and a majority of conservatives in Canada are against abortion. Democrats and progressives in Canada support justifiable abortions.

The abortion issue moved into political camps decades ago. The landmark decision of the U.S. Supreme Court in Roe v. Wade in 1973 declared that women had the right to choose an abortion. In response, anti-abortion groups began to rapidly mobilize and the “Human Life Amendment” was proposed.

Because it’s better to be seen as for something rather than against it, anti-abortion groups decided to call themselves “pro-life.”

Abortion supporters argue that the when life is at stake, it’s the life of the mother which matters. In a reaction to the pro-life branding, abortion supporters had to come up with a strong brand of their own. “Pro-abortion” doesn’t quite do it because women don’t necessarily want to have an abortion –they just want to shed the yoke of paternalism that dictates what’s best for them.

In response to the pro-life movement, supporters of abortion-as-an-option branded themselves as “pro-choice.” It’s a clever label in an age of commercialism because what consumer doesn’t want a choice? It also fits nicely into to the evolving image of women, and citizens in general, as individual agents rather than servants of the church and state.

Women as free-thinking-citizens is a relatively new phenomena. Only a hundred years ago, women and children were considered the property of men and property doesn’t have an opinion worth considering.

Thanks to U.S. President Trump, the tribalism of pro-life is beginning to fracture. Pro-life Republicans are conflicted by support of this misogynist president.

Tess Clark grew up in Texas and always considered support for the Republican party her “Christian duty (Globe and Mail, December 7, 2018).” All of her life the issues of abortion and immigration made voting Republican her “Christian duty.” Clark recently told The New York Times that the pro-life movement should oppose hard-line treatment of border crossers.

Clark was so sickened by Trump and his crackdown on Honduran families trying to enter the U.S. that she has redefined what it means to be pro-life. She now equates the separation of Honduran families with “a baby in its mother’s womb.” “I feel that being pro-life is being pro all life,” she said.

Chelsey Yeaton, a student at a Christian college in Illinois and a member of Young Evangelicals for Climate Action, has also redefined what pro-life means to her in environmental terms.

“If we say we’re pro-life, we have to care for people who are experiencing incredible environmental degradation …,” Yeaton said in a recent interview. “If we’re pro-life, that’s a bigger issue to me than abortion.”

Whether to have an abortion or not is obviously not a trivial matter but the decision shouldn’t be based on politics. The expansion of the pro-life movement into other aspects of a healthy life is a welcome approach.

 

Canadians support carbon pricing

Canadians, including business groups, support Trudeau’s proposed carbon-pricing plan announced Tuesday. So why are some politicians opposed? The short answer is politics, although games are being played by both sides.

image: Werner Antweiler

Recent polling from Environics Research shows that nine out of ten Canadians are concerned about climate change. And a majority support carbon pricing except in Alberta and Saskatchewan. Tony Coulson from Environics Research says:

“For many Canadians, it appears their concern about the consequences of climate change is strong enough that they’re willing to bear some cost to help stop it (Globe and Mail October 16, 2108).”

The feds say that they will collect carbon taxes from those provinces that don’t have a carbon-pricing plan and return the money directly to citizens of those provinces. Depending on how little fossils fuels they burn, they could get more back in rebates than they spend on the added carbon tax.

Opposition parties are calling it a vote-buying tactic in time for the next election.

Those opposing carbon pricing include Ontario Premier Ford. During his Alberta visit to bolster Jason Kenney, leader of Alberta’s United Conservative Party, Ford tweeted:

“I am proud to say that Ontario will stand with Albertans who oppose this unfair and burdensome tax on families and businesses.”

The Ontario Premier has allied himself with Saskatchewan Premier Scott Moe in opposing the federal tax plan. Manitoba also recently cancelled its planned carbon tax.

Carbon taxes are directly on the sources of carbon: 70 per cent of them from burning fossil fuels to heat our homes, generate electricity and for transportation.

Ford claims that carbon taxes take money out of the pockets of taxpayers. Not necessarily. A revenue neutral carbon tax such as the one that B.C. has doesn’t. Sure, we pay more for gasoline but receive an equal reduction in taxes elsewhere. As demonstrated in B.C., carbon pricing reduces greenhouse gases and doesn’t harm the economy.

If Ford wanted to take a conservative approach, it would be our carbon tax. A progressive approach would be to take the carbon taxes and directly invest them into sources of renewable energy.

Canadian businesses also support carbon pricing. The business-backed C.D. Howe Institute has recently come out in favour of carbon-pricing. The institute understands both the necessity and practicality of carbon taxes. C.D. Howe policy analyst Tracy Snoddon says:

“The politics of carbon pricing may have changed but the climate change challenge and Canada’s emissions reduction targets under the Paris agreement have not. The economics are also unchanged – carbon pricing continues to be the most cost-effective option for achieving emissions reductions across the country (Globe and Mail October 18, 2108).”

It’s disappointing to see politicians use the future of our planet as a political football.

Canadians want government action. For the first time in polling history, Canadians say that individual action is not working that governments need to step in.  “A slim majority now feels that voluntary action is not enough to address the challenges we face,” says Coulson.

Canadians are waking up to the fact that individual actions, like changing to energy efficient light bulbs, is not working. Only legislated policies will collectively accomplish what we individually wish for.

 

New Zealand’s experience with electoral reform

I sat down with Helen Clark, Prime Minister of New Zealand from 1999 to 2008, to talk about her country’s experience with electoral reform. She was in Kamloops on June 21 at a reception held at a local pub where about 70 people had gathered.

   image: Wikipedia

“You have five minutes for the interview,” the organizer of the event told us. We made our way to a quiet table.

Two referenda were held in New Zealand, she told me. The first in 1992 was non-binding. It asked whether voters wanted to retain the present first-past-the-post (FPTP) system or if they wanted a change. And if they wanted a change, which of four systems of proportional representation did they prefer?

The results were overwhelming with 85 per cent in favour of a change. Of the four systems, Mixed Member Proportional (MMP), was a clear favourite.

A second referendum was held a year later. This time the referendum was binding and the results closer with 54 per cent choosing MMP over FPTP.

I wondered how proportional representation had changed the culture of political parties. MMP leads to minority governments, Ms. Clark told me, which means that parties need to get along, not only after election but before. “Be sure to make friends”, she said, “you never know when you’ll need them later.”

After 20 minutes, I had asked all my prepared questions and we just chatted. “I thought the interview was only going to be five minutes,” the organizer scolded when he found us. Ms. Clark returned to the group where photos were taken and she gave a speech.

Afterward, I thought about the similarly of our upcoming mail-in referendum this fall to the one in New Zealand.

Two questions make sense to me: Do you want a change? If so, want kind do you want?  However, a B.C. lobby group called Fair Referendum disagrees. In a robocall call, they said that there should be just one question. I had to chuckle. The Fair Referendum proposal illustrates what’s wrong with our voting system. They want a single question with four choices, three of which are a type proportional representation and one being the existing FPTP. Those in favour of change will have their vote split three ways and those who don’t want change will have one choice. The ballot is rigged so that even if, say 60 per cent want change, 40 per cent will make sure it doesn’t happen. It seems obvious that’s what Fair Referendum hopes for.

The referendum, to be held from October 22 to November 30 by mail-in ballot, is shaping up along party lines. The Greens and NDP favour proportional representation and the BC Liberals oppose it.

Kamloops-South Thompson MLA Todd Stone says the referendum would be biased in favour of the NDP and that’s probably true –but only because the BC Liberals choose not to cooperate with other parties.

The Greens and NDP have made an extraordinary effort to be nice to each other because, as Ms. Clark suggests, it’s the only way that future governments under proportional representation will work. It’s a shift in party culture that the BC Liberals have yet to realize.

 

Four more years of Trump?

Improbable as it may seem, President Trump could be re-elected in 2020.

Photo by Anthony Behar

He’s been vilified by many, including those who know him personally such as former FBI director James Comey.

“He has a craving for affirmation that I’ve never seen in an adult before,” Comey told a conference in Ottawa. “It’s all, ‘What will fill this hole inside me?’ (Globe and Mail, June 5, 2018)”

Author Thomas Frank’s assessment is less psychological:

“He is deeply unpopular, the biggest buffoon any of us has ever seen in the White House. He manages to disgrace the office nearly every single day. He insults our intelligence with his blustering rhetoric. He endorses racial stereotypes and makes common cause with bigots. He has succeeded in offending countless foreign governments [!]. He has no idea what a president is supposed to be or do and (perhaps luckily) he has no clue how to govern (Harper’s magazine, April, 2018).”

However, Trump seems to vaguely understand the connection between trade deals and wage stagnation.

Trump withdrew from one such deal, the Trans-Pacific Partnership, which would have strengthened U.S. corporate power at the expense of Canada.

If he pulls out of NAFTA, it will hurt all three countries in the short term. But trade will not stop. We will continue to trade with the U.S. under rules of the World Trade Organization. Tariffs under the WTO would add only 1.5 per cent to Canadian exports.

Trade deals have been a bad deal for many U.S. workers. Jobs have been sent elsewhere. Wages have been stagnant. The threat of moving jobs offshore looms over those workers who complain.

Candidate Trump characteristically expressed his disdain for NAFTA on a visit to Flint, Michigan, where hundreds of thousands had been poisoned by lead in the water. In a caustic manner, he said “It used to be that cars were made in Flint and you couldn’t drink the water in Mexico. And now the cars are made in Mexico and you can’t drink the water in Flint.” Funny, and a telling display of Trump’s lack of sympathy.

The American economy is on a roll and that could put Trump back in office for another four years. The U.S. unemployment rate was 3.9 per cent in April, 2018, a seventeen-year low. Under trade deals, corporate America is currently sending some of those jobs offshore. If trade deals are cancelled that will create a worker shortage that will drive wages up.

Of course, cancelling trade deals will also drive up the cost of goods for Americans but voters may not care, or will be unable to make the connection. The pain of unintended consequences has never been a problem for Trump says Thomas Frank:

“The president, always a fan of burning down the village in order to save it, is currently threatening to scuttle the whole agreement: ‘A lot of people don’t realize how good it would be to terminate NAFTA, because the way you’re going to make the best deal is to terminate NAFTA.’”

What matters for American workers is that they are back at work. No matter that the sparks for the economic recovery were ignited by former President Obama and chair of the Federal Reserve Janet Yellen.

In the 2020 campaign, the slogan could be “it’s the jobs, stupid.” And Trump could win.