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Forrest Gump in Action


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A journalist's take on business, news and people in Canada and the U.S.

Diane Francis

Canada's Jim Flaherty: The Forrest Gump of Finance Ministers

Canada is "just a box of chocolates" to Flaherty and his foreign investor fans.

Exhibit One

All Canadian workers took a hit. The Canada Pension Plan has lost $158 million on its income trust portfolio since the Oct. 31, 2006 attack by Flaherty. This on top of $35 billion lost in total, not counting lost opportunity costs after the Prime Minister's promise to protect them was broken.

Exhibit Four

Flaherty has given away chunks of Corporate Canada and forgiven future taxes.

Here's the math in one case: Abu Dhabi's acquisition of Prime West Energy Trust for US$5 billion removes an estimated $32 million paid in withholding taxes by its foreign unitholders; $57 million paid by its Canadian unitholders and another $25 million deferred but eventually paid by RRSPs. That's $114 million a year which the Arabs will use to make tax-free payments to their foreign bondholders who just bought their bonds this week to pay for this takeover and two others.

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There is more but the above exhibits are enough to make any Canadian sick. And Steve, the economist allows Jim to bumble on. Guess neither knows wtf they are doing.

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A journalist's take on business, news and people in Canada and the U.S.

Diane Francis

Canada's Jim Flaherty: The Forrest Gump of Finance Ministers

Canada is "just a box of chocolates" to Flaherty and his foreign investor fans.

Exhibit One

All Canadian workers took a hit. The Canada Pension Plan has lost $158 million on its income trust portfolio since the Oct. 31, 2006 attack by Flaherty. This on top of $35 billion lost in total, not counting lost opportunity costs after the Prime Minister's promise to protect them was broken.

Exhibit Four

Flaherty has given away chunks of Corporate Canada and forgiven future taxes.

Here's the math in one case: Abu Dhabi's acquisition of Prime West Energy Trust for US$5 billion removes an estimated $32 million paid in withholding taxes by its foreign unitholders; $57 million paid by its Canadian unitholders and another $25 million deferred but eventually paid by RRSPs. That's $114 million a year which the Arabs will use to make tax-free payments to their foreign bondholders who just bought their bonds this week to pay for this takeover and two others.

~~~~~~~~~~~~~~~~~~~

There is more but the above exhibits are enough to make any Canadian sick. And Steve, the economist allows Jim to bumble on. Guess neither knows wtf they are doing.

What can Canadians expect from a guy who help Harris and Eves leave Ontario in debt.

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What can Canadians expect from a guy who help Harris and Eves leave Ontario in debt.

People still find a way to dredge up Mike Harris' name. The truth of the matter is that when Harris came to power, Ontario's deficit was $8 Billion a year and growing - thanks to a recession and Bob Rae's NDP government. The amazing thin is that revenues back then were only about 45-50 Billion. Think about it - an 8 billion dollar shortfall when you're only collecting 45 billion in revenue. Contrast that to McGuinty's "crisis" of 5 billion on revenues of about 90 billion....and in fact the deficit was really closer to 3 billion - the Libs did some accounting tricks to drive the deficit up "on paper" - for example, they didn't count the almost one million dollars that came from the Feds as support for the SARS epidemic. So how did Harris get out of debt and at the same time make the biggest injcreases in Education and Health spending in history? Well first they lowered taxes to get businesses to come back to Ontario - they had all fled to other juristictions to get away from the NDP taxes. They centralized the education system so that unions could no longer pick on a weak school board, "bargain" the best wages they could - and then demand that all school boards fall in line. That's what led to the per capita funding. And guess what - McGuinty hasn't changed it - nor will he. Why? Because it's the right way to do it - it just needs a bit of tweaking.

But I digress - just look at the deficits that I detailed above - what Harris and Snobelon and Flaherty did is absolutely amazing. They were the right bunch at the right time. They were "fixers" - not managers. Their skills had run their course - that's why Harris stepped down. History may very well show that Harris was not only the architect of the Common Senses Revolution - but he actually saved Education and Healthcare in Ontario. It was painful but necessary.

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