Fuschi’s Canadian Forum

I answered to your e-mail, but I don’t know for sure if you got it. You can reply at r.fuschi@hotmail.com. Happy new year.

All the expected vultures are picking at the bones of ex-PM Brian Mulrooney. They finally have him red-handed, with his fist clearly stuck in the cookie jar. They knew it all along, you know. It took several inquisitory proceedings, but the truth is finally out. And, after all, it’s truth we want, right? The sort of truth we can count on when we rely on a human parasite like Schreiber, to impale a prime minister on his own misdeed. Mulrooney perpetrated the greatest possible misdeed that a Conservative can make. He forgot how severely scrutinized are the actions of the right, by the forces of the left, - media foremost.

That is not to say that surrendering to the allure of Schreiber’s filthy lucre, did not diminish the pristine facade which a prime minister must always present. It did, and our compassion should mitigate the damage, if only we put ourselves in his mortal shoes. But we have not. The hangman’s noose is more fun.

When we are done picking at the bones, I will be waiting with bated breath for the vultures to move to another juicy target which has been awaiting their scrutiny for quite a while. We have yet to pursue to its source, the stench of adscam. We have settled for the necks of a couple of fall guys and bagmen, to the great relief of the Liberal establishment. They are still laughing at the notion that the public could be suckered so easily. That we would believe that a couple of two bit operators could so easily redirect vast amounts of tax dollars for personal Liberal use, without any direction from the political top. We got offered a phoney bridge and we took it.

We should burn into our consciousness, this reality. Mulrooney was wrong to take Schreiber’s money, because it looked bad. But he did not steal it. It was willingly offered by a snake. On the other hand, the Liberals stole tax money and perpetrated a scam to hide their actions, - a far greater wrong - and none of the political leaders have yet paid the price at the hands of the law. 

The road travelled by the auto negotiations (Canadian), was entirely predictable. After the CAW’s Lewenza was done with his chest-beating, he quietly capitulated behind closed doors. Unable to use any of the coercive levers of the past, he had no choice but to dance to the piper’s tune "with a gun to our head". All the fire and brimstone pronouncements made to the media throughout the course of exhaustive contract-making, was entirely for his membership, who, in turn, were played by him like fiddles. The glossy handout given to voting union members at the ratification, was no last minute print job. Its contents had to be finalized well before the last minute handshake.

Sad to say, because I am one of them, most members were unaware of the game being played on their behalf. When "Kenny" said, we won’t take concessions because it’s not our fault, they cheered him on and resolved to fight the demands. When he told them what had been surrendered, they cheered the victory, and thanked him. What will come next, and is already emanating from the propaganda of the inner circle, are the targets of blame. Nothing learned here.

You will continue to hear about poor management and what their greed did to workers. That’s a historic theme which is not about to go away. You will see repeated the refrain that these people took no concessions in their pays. Never mind that the ranks of management at all levels are being decimated, in the egalitarian world of the union, every shop floor labourer is worth as much as a CEO, and the two should be treated equally. This makes the never-spoken assumption that union leaders are not subject to this same judgement, and they never make any mistakes. Nothing learned here.

Most of all, you are going to see repeated ad nauseam, the accusations against Harper’s government. Today’s papers already talk about Harper’s and Clement’s efforts at union-busting, and promises of revenge. That revenge, however is the same one that was exercised when the CAW’s Hargrove, in a display of utter paranoia, recommended that we vote for Liberal Adscam liars, Bloc separatists, NDP, perhaps even Bin Laden himself, as long as they showed no allegiance to anything conservative. Nothing new here. The present conflagration is just a newfound rekindling of old hatreds. Nothing learned here.

In stubborn contrast to this anti-conservative paranoia, is the utter silence regarding the part played by Obama, who essentially set the scenario in which the union found itself giving so much back to the company (Chrysler). Harper’s government, in turn, found itself between the edicts of the US president, which they could not refuse, and the ire of Canadian voters/taxpayers who do not show much sympathy for the predicament of Canadian auto workers. If Obama repays his union campaign donors by bringing home assembly plants, the CAW will still blame Harper. Nothing learned here.

At the very least, CAW members, especially union propagandists, should air these grumblings amongst themselves, where the ground is fertile for reenforcement. Not in the media, where soreheaded complaints about giving up $240 million because of those bastards in government, and with a gun to one’s head, are received with utter scorn. Nothing learned here.

My golf buddy, Mark, used to be what I would label a "conformist", with little patience for social mavericks. That all changed when a driver blew past us on the 401 yesterday. Mark, who is wedded to his cruise control, shocked me when he yelled out a supporting, "Give them hell, buddy!"  It seems he has had an epiphany, compliments of Ontario. It had occurred to him that almost everything you did, these days, brought social sanctions with it and he had had enough. "You can’t do a ——- thing without looking over your shoulder, in this God—- province."

Just to remind us how true that is, the pesticide ban just took effect. Then I read that using a cell phone in the car was, by a new edict, worth a $1,000. Each is innocuous enough by itself - like banning pitbulls - but accumulated over six years of this government’s lawmaking, it begins to look like a dangerous web of decrees. As in the case of the street-racing edict, each will capture many people whose intentions were not reflective of the law’s goals.

These are the sorts of laws passed when a government is unclear on the scope of its true responsibilities. McGuinty’s is a sunshine government which meddles with our lives on apple pie issues which, individually, are difficult to oppose. But!! The sunshine has gone behind very dark clouds, and this government is no longer just unclear, they are oblivious. I am reminded of this every time I think of the fallout which will ensue from attacking the consumer with eight percent higher gasoline and heating costs. These alone will likely add two billion dollars in taxes, on top of our shaky legs. Add to that the cost of greening our energy structure, and Ontario will remain in recession for years to come.

Where can we look for salvation from this shipwreck? I am becoming increasingly fearful that Ontario’s Conservative opposition shows few signs of being able to take the helm. Do any of the prospective leadership hopefuls show the right stuff to save us? Randy Hillier will be challenged to appeal to Toronto’s triple cream crowd. Tim Hudak is currently the only one making some of the correct noises, but his genteel manner and low profile will keep him from sparking the imaginations of sleepy Ontario. Frank Klees, whom I would normally support, appears to be starting from half a lap back, and has been in politics too long to make the necessary noise. Christine Elliot appears to sport certain advantages, not the least of which is her gender, and her cosmopolitan career. However, I don’t think a female John Tory is going to cut it, and you can expect the teaching cartel and other beneficiaries of McGuinty’s largesse to go at her with troops and money, just because of her connection to the Harris administration (through her husband, Mr. Flaherty).

One would think that the economic mess should sink the Dalton gang and make any of these candidates sufficient to lead the Conservative party to victory. Unfortunately, I have the unconfirmed suspicion that voters blame economies disproportionately on Conservative governments. McGuinty is an adept liar, and Ontario voters are adept at biting hooks, hence his administration can survive this. The candidates, on the other hand, show no signs of understanding that they need to involve the voters now, in their drive to the top, and are busy discussing beer sales and tourism while the economic whirlpool sucks all of us under. If any of this bunch, other than Mr. Hudak, has looked into the crystal ball and seen what McGuinty’s mismeasures are going to do to us, they have not shown the necessary fire to help stop the coming wreck. If they have not seen it, they have no business trying to run the province.  

Since abandoning the world where a numerical digit represented a finite and definable quantity, John McCallum has become the consummate Liberal. And, his latest emissions depict the quintessence of Liberalism. His automobile is whatever you want it to be, because for a Liberal there is no principle so worthy that he cannot abandon it, to tell you whatever he thinks you want to hear.

The real problem with the gun registry is not that it is a wasteful boondoggle, or that it defies logic, but that it represents the pathetic effort our politicians are reduced to when they have irremediably lost the battle to reform our sclerotic justice system. Even though it is reminiscent of some wacky scene in Alice’s Wonderland, the registry is certainly the best that a cornered Liberal (Allan Rock) - trying to look commanding in the face of a tragedy - can come up with.

The Brian Knight affair, otherwise known as the case of the stolen ATV, is just one indication that our expectations from the system that protects us, have shrunk to the point where large segments of the population consider Mr. Knight a hero. He picked up a gun and fought to retain his property. And, just to prove my point that Lewis Carrol cannot be far away,  he was charged by police and is in danger of greater consequences than the would-be thief.

Let us not make the mistake of thinking that all are in tune with Mr. Knight’s actions. Ira Wells writes in the National Post www.nationalpost.com/todays-paper/story.html , dismissing the actions with such statements as, "Only in Alberta do we blithely dispense with due process…" But is not the pridicament Mr. Knight finds himself in precisely a clear example of the dysfunction of that due process? What about his imperious insistence that "Two wrongs do not make a right."…"grasped intuitively by the youngest children…" Has anyone noticed that the perps in this scene are protected from summary conviction even if they were found on the ATV by a police officer. They can always claim that they thought it was theirs or that they lost their mind. And the good, law-abiding taxpayers of this country will have to pay enormous legal costs to prove these defenses to be the farces they appear to be. On the other hand (the other wrong) Mr. Knight begins to suffer from the minute he is charged, in a hundred different ways, for being in a position he did not ask for. Indeed, if we taught our children that justice is always this blind, we would have a nation of outlaws. Our insistence on being optimistic has kept that from happening, so far.

While we are still a civilized society, it is difficult to justify the taking up of arms as reaction to every perpetrator’s ill act. There would be fewer perps, but considerable carnage would result from the use of guns by the inexperienced. But will we remain a civilized society forever in the face of justice petrification? If we cannot rightly expect to be treated as innocents while the perps are, how long will we continue to rely on a system that opens the gates to the unjust, all too often? Nor does this scenario require any guns. A friend who was persecuted and vandalized by youths which showed no respect or remorse, had the police called on him by the persecutors, when he threatened them. The police took him aside and warned him that if anything happened he could be charged, even if they were on his property. With a wink and a nod they also told him -extremely unofficially - the only thing he could do was confront the perps individually, in the dark, and make sure there are no witnesses.

Our justice system is in decay. It can no longer live up to the guarantees it makes to the virtuous, and it has lost sight of what is just reward for the acts of criminals. The innocence of the criminal must be proven to be invalid, while the suffering of the victim goes on unabated, if he has not retaliated, and more so if he has. In the face of this perversion of justice we continue to debate whether it is right or wrong to expect a criminal to willingly declare himself to be the owner of an Uzi.

Recent information about the pension implications of a GM bankruptcy, promise to turn a bad situation into a tragedy. Laws which protect pension funding were allowed to be bent for various reasons including the size of GM and the unthinkable nature of the current catastrophe. Ontario’s emergency pension fund never conceived of this disaster and is hopelessly inadequate. McGuinty and Duncan, fresh from papering the Toronto streets with our future tax dollars, (there are no current dollars left) claim they can do nothing. (That’s been too clear for a while.) To cap this off, the Obama administration appears to be willfully pushing GM into the corner labelled bondholder and pension default. (To the American unions who donated $100 million to buy hope, "yes he can". Put that in your obsessive liberal pipe and smoke it.) 

Distill all these looming dark clouds and what remains is another vital incentive to the co-ordinated salvation of the North-American auto industry. Yes, all of it! Recent interviews with some of Japan’s auto execs, heard warnings that a collapse of any of the big three can drag them down as well. The domino effect can become global and add a new threat to the enfeebled banking system.

In the face of these threats, what needs to be done?

First, ignore the idiotic polling of the public. As I pointed out in the last post, most of the population consists of economic illiterates, who cannot be given veto power over the necessary measures. 

Second, keep the government the hell out of the boardrooms, and design studios of the manufacturers. The domestics have learned clearly where they made their mistakes. They allowed the Japanese to reinvent the manufacture of automobiles. This absolutely does not(!!!) mean that they build the right cars and we don’t, as our enviroidiots keep repeating to the world - at great cost to our manufacturers. It also does not mean that the conflict was begun between the peanut-pusher and the SUV. What they did do was create a car in which all the screws remained in place for the life of the vehicle, and all the body panels fit as though they belonged there.

They perfected the concept of assembly as a final, long-term event which need not be revisited by a reluctant dealership, during the life of the car. All the major manufacturers know this and have copied it successfully. Any other assessment is BS. As for the conflict between big and small cars, the market is big enough to demand enough of both, and the price of gasoline will do the rest. Bureaucratic meddling will only put another nail in the coffin.

Now that we are clear on that, governments need to acknowledge the part they played in injecting bureaucratic sludge into the engine of the auto business. Who the hell needs the intrusion of CAFE rules when gas is past the $1.50 per litre or $4 per gallon mark? Multiply this sample stupidity 10,000 times to get an idea of the total intrusion. After this mea culpa, the governments must undertake all measures to keep the first domino from falling, and to back the pensions of the innocent victims of the Japanese revolution. (They do it for public sector pension funds. Why are they special?)

The domestic auto companies, (not the Japanese) are guilty of learning too slowly while their market pie dwindled. Now they can no longer feed everyone on the piece that is left. The unions are also guilty, of presuming they would always wield the leverage they have now lost. And, of believing that removing the competition which threatened their cozy empire, was the solution. These realities will reshape the domestics and their employees whether or not the government understands their proper part in the evolution. But, their correct, and essential duty in this crisis is to stabilize the market, and begin to engender the confidence that will bring back buyers. (Obama’s ruminations about reinventing the automobile won’t help.)

Abandoning the big three to the bankruptcy vultures is no more an option than it was for the banks!

PS: As an employee of one of the big three, I have a conflict of interest, but I believe the logic of this post still holds true.

An excellent thought from a Toronto school trustee appears in the National Post digital.nationalpost.com/epaper/viewer.aspx . It is the idea of teaching financial literacy and economics at an early age. The gist of the trustee’s argument is that the current financial meltdown might have been tempered by a better understanding of personal indebtedness. 

I have long been convinced of the value economic basics, taught early with the three Rs. (Do they teach them anymore?) But the value of this subject goes far beyond what the trustee has envisioned. I am convinced that a proper grounding in economic fundamentals can make us a society of better voters, and help us escape the curse of getting the politicians we deserve. The Chretien dark ages are rich in examples of how Canadians might have been better served if they had fulfilled an obligation to vote from a foundation of knowledge.

For example, we may not have swallowed his hook so easily when he promised to abolish the GST. The simple knowledge that a country in serious deficit cannot afford to abandon a significant portion of revenue, would have sufficed. But, how many people know what a deficit is, and how it differs from debt? How many people felt reassured by the hoax of the gun registry while understanding little about the beneficial effects of a billion dollars spent on chasing criminals.

Getting closer to home, does anyone understand the tremendous disparity between Ontario’s tax take, and what McGuinty is projecting to spend? How about the economic consequences to ratepayers, when all sorts of expensive new power sources are allowed to sell to Ontario’s power grid at prices that are many multiples of hydro power? What about the impact of the new combined sales tax? Has anyone even considered the consequences of a sudden eight percent increase in the price of gasoline? Have you compared the billions that it will take out of consumer’s pockets every year, to the piddling thousand dollar bribe McGuinty is going to confuse us with?

Nor is it governments alone that play these shell games which challenge wise choice. Take the latest blather about buying only things made close to home. First, who on earth can tell what portion of a product is built where? If I buy a Toyota built in Ontario, is that allright with the CAW? How about a Chrysler PT Cruiser built in Mexico? If I pledge complete allegiance to minivans built in Windsor, Ontario, Canada, where I live, will that not fulfill my duty, but at the expense of my fellow workers in Bramalea, not to mention Detroit, which is closer. And, is there no consequence to this game? What if we were mandated to buy a loaf of bread from the same supplier every day? How long before we were paying outrageaous prices for moldy bread? Who would listen to our complaints once the competition is shut out?

Lest you take offense at my presumption of the voter’s naiivete, remember that I climbed thirty thousand porch stairs during three elections, and have had ample certification of the economic void in people’s heads. No better idea for education exists, nor is it likely to be enacted. Teachers and their federations would never accept this new burden. They might fear the kinds of appraisals of their own performance, that might arise from an economically empowered population. Or, worse yet, the kind of appraisals of their political darlings, the Liberals, that wiser voters would make.

The honeymoon between the progressive presidential choice, Obama, and the unions which donated $100 million dollars to his campaign, will soon be over. It will be over far faster than than the divorce that occurred between Bob Rae and his union supporters, but for essentially the same reasons. Let’s just say that the doodoo in Obama’s case, was closer to hitting the fan before he took power than Rae’s home made meltdown.

There is both good and bad in the hard line with which he whipped the domestic auto companies today. It appears that they were using an eyedropper to put out the fire rather than a firehose. Their incrementalism will not work, because it depends on the taxpayer’s willingness to continue funding them until increased car sales can take over the task. The timing of the latter is not in the least certain, and taxpayers don’t look like they are interested in their share of this plan.

On the other side of the coin, far too much noise is being made by government on the reshaping of the nature of the automobile. This is something on which Washington is very poorly qualified to dictate. Noone anywhere near there, knows where a sparkplug is, and much of the distemper of the auto industry can be blamed on their zeal for votegetting, destructive automotive legislation. Just as the destruction of the industry which finances car purchases can also be blamed on politicians’ zeal to get noticed by the public. Increased socialization of the automobile is the road to destruction. This is no time to chase electric pie-in-the-sky or insist on the specifics of what the consumer "wants".

If we must give blame, why not disperse it evenly. It is insisted that both unions and companies drove each other to the brink, then why just get rid of Wagoner? Why not Gettelfinger as well? Too confrontational maybe? Oh, how about that pesky $100 million?

In Canada, CAW leader Lewenza is still unclear of the concept of economic meltdown and insists that all those others who share the blame in this, must lead the way. This is not the fault of the worker and he should not have to pay for it. His divorce with Obama is coming too, but there is much to blame on the Conservative government before he is through. Free trade, fair trade, yadda yadda. He has hardly acknowledged the fact that $4 billion of taxpayer’s money has just been made available, even as we wait for further concession progress. Which he has declared will not be forthcoming.

Mr. Lewenza likes to repeat the undisputed theorem that since total labour costs only amount to seven percent, his constituents could surrender it all and it would still not save the companies. My admittedly rough calculations say it is closer to twice that, but even if he is right, why are so many people doing their utmost to diminish the amount? What can possibly be gained by prolonging this battle if it is of no importance? How can it make no difference that 10,000 GM Canadian employees are supporting 50,000 retirees?

The greatest danger, was voiced by Obama today, when he spoke of the possibility of allowing the companies to reshape the whole world we have come to depend on, by allowing chapter eleven restructuring. In this scenario, nothing is guaranteed, and there are no negotiations. The outcome will occur by fiat at whatever expense to the dependents. Mr. Lewenza has the choice of bleeding, or being gutted and bled. 

Ontario business is suffering from the Stockholm Syndrome. They have been captive, beaten, reviled and squeezed, so often, that the least hint of an end to the punishment  turns them into boisterous supporters of their tormentors. They are overlooking some pertinent details, to their detriment.

I have been a strong advocate of lower taxes on Ontario’s capital investment and specifically corporate taxes. To me it seemed that the Irish model worked so well, while with the ususal Liberal tax and spend there was always a piper to be paid. That time has come in spades, and even the hapless premier has begun to fathom the hopelessness of the position into which he had put Ontario. But what results from this budget is a shell game.

I don’t blame businessmen for cheering at the thought of imminent corporate tax decreases, and the reduction of tax excesses related to a parallel consumption tax system. But when prominent spokesmen and journalists dismiss the plight of the consumer and presume that the outcome will be neutral, they are not using the same math that I am. Stop looking at the tax-free diapers and concentrate on the enormous energy tax grab. 

CTV reports that in 2004 Ontario consumed 15.7 billion litres of gasoline. Let’s optimistically assume that the figure has remained the same. If gasoline is selling at $1.00 a litre (will probably be there by June 2010) the levy on Ontario’s consumer from harmonization will amount to $1.256 billion dollars per year. This is just the increased price of gasoline. We have not even tried to table the damage done by tax increases on natutral gas and electric power.

I sympathize with business which has taken much abuse from this administration, but they are accepting some freedom from their captors, at the expense of further tormenting the consumer. Wrong strategy! The buyer of your products has already drawn his head into his shell, remember. If we bury him, all the corporate tax deductions in the world won’t help you. Characteristically, McGuinty has given with one hand, while taking with the other. This shell game will be the last stake through the heart of the Ontario economy.