Wednesday, January 26, 2011

Lower Taxes for Corporations Leading to Job Growth is Corporate Propaganda at Its Best

The 20th century has been characterized by three developments of great political importance. The growth of democracy; the growth of corporate power; and the growth of corporate propaganda against democracy.
(Alex Carey)

In Canada fifty years ago, corporate income tax represented 50 % of government revenues. Today, that figure is around 7%, and there are those who would have us believe that if we don't lower corporate tax rates further that this would blind side the economy and leave Canada crumpled on the ice like Sidney Crosby after a hit to the head.

Pretty powerful stuff. Completely beside the point, but pretty powerful stuff nonetheless.

The obvious question to ask is where will those new jobs be located. Here at home or somewhere else in the world where labour is cheaper and the regulatory framework is more favorable?

The intended effect of lowering corporate tax rates is to make corporations more profitable and to enrich those in the investor class. The secondary effect with regard to increased employment as a result of greater corporate profitability is in no way materializing in the US. So, why should it do so here?

Looking at rise in stock prices, investors have experienced a "V" shape recovery while those unemployed in the labour market are experiencing an "L" shape recovery, meaning their futures have been flat-lined.

Take the case of the appointment of GE executive Jeffrey Immelt to President Obama's Economic Recovery Advisory Board. As Paul Krugman points out, with fewer of half of GE's workforce based in the US and less than half of it's revenues generated by US operations, GE's fortunes have little to do with prosperity in the US.

The truth of the matter is that we all don't live in the same economy. Value can be added to the production cycle of either goods or services from almost anywhere on planet. As a result, many of the jobs in question can just as easily be outsourced off shore.

What's really at issue is those who comprise the top one percent of revenue earners can never have enough. The income inequality within this bracket is extremely high, the top one-tenth of the one percent earn ridiculously more than the bottom one-tenth of the same one percent, so that to keep up with the super rich Jones it takes everything that one makes and more. Consequently, the pressure to lower corporate taxes as a means to raise investment income never abates.

In the words of F. Scott Fitzgerald,"the rich are different from you and me." They don't give a shit about anybody but themselves.

Tuesday, January 25, 2011

Minority Government is the Domination of the Many by the Few

One day I would like to live in a democracy. Chances are that's not going to happen anytime soon judging by the media's reaction to the five year anniversary of Prime Minister Stephen Harper's Conservative government.

Almost all the punditry is focused on the performance of Mr. Harper's government and precious little is devoted to the larger more fundamental question of Canada's democratic deficit.

Single party minority government is a flagrant violation of democratic principles. The Harper government, like the previous Martin government, rules as if it had a majority. However, if you factor in our pathetic participation rate during federal elections, the present government enjoys the support of less than one quarter of the electorate.

So, what does this mean in practice?

In reality, it means that we are governed by an oligarchy that advances its own interest at the expense of the common good. In the Westminster parliamentary tradition, the two parties vying to form a government, not on the basis of the popular vote but of territorial control, each take their turn dominating and controlling the population. The same can be said of America. As a result, choices between Liberal or Conservative in Canada, Conservative or New Labour in the UK, or Democrat or Republican in the US are largely illusory. The fact of the matter is that in each instance private interests trump public concerns, which leads to increasing inequality within the respective societies and the absence of adequate legislation to address the global hazards of climate change.

Canadians need to wake up collectively to the fact that only a government which gives meaningful voice to the concerns of all its citizens will in the long term advance the well-being of the entire population. Eliminating voices by narrowing political debate to a few essential ballot questions in a few swing ridings makes mockery of democracy.

The 21st century challenge for Canada is to break with traditional Anglo-American political institutions and develop its own democratic order. There are many improvements that could be made, but the journey of a thousand miles begins with a first step. In what would be a sequence of events to establish a system of governance based on democratic principles, the first step is to change the electoral system so that each vote counts and is given equal weight.

Afterwards, we would mark the anniversary of the introduction of successive democratic reforms together.

Friday, January 21, 2011

The Moral of the Bastarache Commission: Don't Fix the Blame, Fix the Problem

There was something adolescent in Jean Charest's assertion that he had been cleared of any wrong doing in the nomination of judges by the Bastarache Commission report and that it was the former Minister of Justice, Marc Bellemare's fault that it was necessary to convene the commission.

Obviously, the buck doesn't stop with Jean, six million bucks to be precise, the cost to the public purse for what could have been accomplished at a fraction of the cost by a legislative committee.

In short, the Charest led Liberals were found not guilty of undue influence peddling in the nomination of judges. Undue in this instance means that the nominations were not simply bought.

Yet, in a wonderfully euphemistic understatement, Bastarache went on to say that the nomination process was "permeable" to outside influence:

the process is vulnerable to all manner of interventions and influence, particularly by members of the National Assembly, members of political parties, lawyers and the candidates themselves. The candidates’ political affiliation or acquaintance with representatives of the political party in power may play a role. There are no standards governing the handling of the files or the conduct required of the Minister of Justice, the Premier, the members of their political staff or other stakeholders, particularly with respect to which persons may be consulted for the purpose of recommending an appointment. There are no criteria in place to guide the Minister in making recommendations. Every Minister of Justice has had to establish his or her own guidelines in these areas.

This is not a glowing assessment of the nomination process of which Charest is ultimately responsible. It's as if with Charest at the helm the ship has run aground, but the investigation has shown that he wasn't drunk at the wheel; he was simply incompetent.

Fortunately, there were 46 recommendations made that would if acted upon raise the credibility of the nomination process.

Which brings me to my main point, this is not all about you Jean. We know that you want to hang onto your job at all costs. But hey, things are extremely screwed up in Quebec. We need to understand the scale and the scope of the problem. That's why a public inquiry into the construction industry and the financing of political parties is absolutely necessary.

Your precious reputation aside, having your ridiculously named Operation Hammer lay charges upon a few scapegoats is not going to address the systemic problems and restore the people's confidence in their government.

Let's get out of the blame game and fix the problem.

Wednesday, January 19, 2011

Corporate Personhood the Great Mother of Political Lies

January 21, 2011 marks the first anniversary of the infamous US Supreme Court decision in Citizens United v. Federal Election Commission in which the Court ruled that corporations had First Amendment rights concerning freedom of speech and that limitations on their ability to spend during elections constituted an infringement of those rights. Consequently, corporations can spend as much as they want on third party campaigns, including foreign corporations that have an American subsidiary.

Of course, this means that corporations will make contributions to organizations like the American Chamber of Commerce, which will in turn invest millions in political advertising supporting the positions taken be their preferred candidates. So much for democracy.

At the moment, I happen to be reading a must read, Thom Hartmann’s Unequal Protection: How Corporations Became “People” – And How You Can Fight Back. In his book, Hartmann chronicles the abuses of power that result from granting what are essentially human rights to non-human legal fictions. (In case you are wondering, in Canada corporations are not granted Charter rights). For example, corporations are protected by the privacy rights of the Fourth Amendment and do not have to reveal information against their desire not to disclose. As a result, when it comes to knowing what is the composition of the toxic concoction used in the fracking process to extract shale gas, the public is left in the dark. Moreover, corporations shielded by the Fifth Amendment can lie to the public as was the case of Nike that lied about its production methods used for the fabrication of its products.

But what really blows my mind is the whole notion of corportate personhood is founded of a big fat whopping lie. The US Supreme Court never granted natural person status to corporations in any decision rendered by the Court. The notion that a corporation is a natural person and is subject to the equal protection requirements of the Fourteenth Amendment is found in the headnote added to the decision by the then court reporter when the decision of Santa Clara County v. Southern Pacific Railway was published after the death of the sitting chief justice of the Court. Importantly, the headnote has no legal status, but was used to establish precedent in a subsequent decision by the subsequent chief justice and then became part of the case law. Talk about a miscarriage of justice.

If you are a regular reader of this blog, you’ll know that I try as best I can to flush out the cultural myths that lead us to live within the lie. It strikes me that if average Americans would like to do something to improve their lot, they should do something to address the huge lie that has been perpetrated at their expense and end this outrageous affront to democracy.