Sunday, November 07, 2010

Potash Deal Hits the Wall

"No matter who controls the company, however, the damage to Canada’s reputation as a place to do business is done. Now that the Conservatives have joined the protectionist bandwagon, investors have lost their chief ally in Ottawa. Other countries will doubtless be more welcoming."

The Economist

There was a time when Stephen Harper actually stood for something. The decision by the federal government to kill the potash deal is proof that those days have long since past. We'll never know if the deal BHP was offering for Potash Corp was good for Canada or not. We do know that it's dead. We also know that this so-called conservative government is responsible for the only two rejections of foreign takeovers under the existing legal framework. Brad Wall's provincial concerns about the coffers of his rentier state should not come above national interest. Saying no to foreign direct investment in the midst of a major recession is reckless and endangers the future economic welfare of this country. If I were BHP, I'd be asking the government of Australia to take this to the WTO as it seems to be a clear violation of the principle of national treatment. The Mayor-elect of Toronto boasted that Toronto is now open for business. Under Stephen Harper, Canada is now closed.

Tuesday, November 02, 2010

The Fighter Jet Farce

There's a lot of squawk from the right about the virtue of paying billions of dollars to have fighter jets constructed somewhere else. The argument seems to be a) Chretien scrapping the helicopter deal cost us some money, therefore don't scrap the jets, b) we've already put this much in we may as well keep going or c) the Russians are coming! These arguments don't hold water and they hold even less ice.

In order to justify buying 65 fighter jets, you need someone with an air force to fight. The Taliban may be a menace, but there's no red baron in their midst. Future missions in places like the Democratic Republic of Congo would be similarly free of significant air-to-air challenges. Thus, we have Stephen Harper's great Russian canard. "Arctic sovereignty" is a wonderful idea. It gets political scientists all hot and bothered. I mean how can you be a country if you can't protect your own borders? Logical? Maybe, but completely irrelevant. The people we would have to theoretically protect our "sovereignty" from are the Russian Federation and the United States of America. In case we've somehow forgotten, they are nuclear powers. Canada is not. Let me get this scenario straight: The Russians send fighter aircraft into the Northwest Passage to prevent... well I'm not quite sure... maybe us bombing their boats? (This is a naval passage after all, you can fly over the pole right now.) Anyway, there are Russian fighter jets in the northwest passage. Are Conservatives actually suggesting we threaten to shoot them down? Are we going to unilaterally declare war on Russia? The answer is of course no. A policy of "shoot down the plane and hope they don't retaliate" is almost as stupid. There are almost no conceivable scenarios where a top of the line jet fighter would protect our "arctic sovereignty".

So, if there's no purpose to these jets why are we wasting taxpayers dollars on it? It costs money to cancel any program. I don't hear Conservatives decrying Rob Ford's attempts to stop Transit City, in spite of the cancellation fees involved. Yes, cutting government waste long term may have short term costs, but our deficit, thanks to Tory tax-cut and spend policies, is a long term problem. This is pork at its worst. I don't care who originally signed the deal. It needs to end.

Finally, the sea king ghost. Canada's military actually does need helicopters. It also needs armored personnel carriers. We could probably use some more air lift capabilities if you want to spend the money on the RCAF. If you don't want to cut the military budget because that's somehow sacred, spend it on things we actually need. Fighter jets have got to be just before inter-planetary spacecraft on the most needed list. We can debate whether or not ending the misconceived helicopter contract 20 years ago was a good idea or not. There are two sides to that argument. It is not relevant to the current discussion.
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