What to do with Canada Post?

[bleeding heart]

I have worked for the city. It is the laziest bunch of half-baked braindeads one could ever meet, I know this absolutely first hand and for a fact. Being a conservatively minded person, my first few weeks I wanted to do a good job and worked really hard. After 2 weeks I was doing roughly double the work the previous crew with 15 years experience had been doing. I received a scolding from others, telling me in not so many words that I better tone it down because was making the previous group look like lazy f*ups (which they were) . Yep......funded by regular market-employed people's property taxes. What a disgrace. People who think gov departments should exists with good wages just for their own sake, do nothing but destroy their societies, and there are many of nation-examples in recent history to illustrate that.

So you conclude your post not only with an anecdote--that is, with a rhetorical method so completely unproveable, and un-disproveable, that it is literally completely useless to everyone, and carries literally zero information; and then you pile on by producing the most self-serving, self-aggrandizing anecdote in recent memory--and you don't think it might undermine the rest of your post in any way?

All right, carry on, then.

[Argus]

No - they made a choice and agree inflated compensation packages because they did not factor in the risk associated with providing pensions. If they had factored in the risk they would have had to accept less.

Once again, you have a strange belief in the mysterious powers of the union. You know, a long time ago, when the world was young, I worked for a security guard company. When the guards unionized, the union tried to negotiate a contract which had some minor benefits and a small increase in wages. The company hired a bunch of new immigrants and simply locked out all its existing guards. The lockout lasted, I think, over a year. I don't recall the exact terms of the result since I was gone by then, but basically the guards got very little.

When you think of the likes of Wal-Mart, which closes stores rather than employ unionized workers, or the big banks, which fires anyone who even mentions the word union you might reconsider just how powerful you think unions are. There are a couple of unions that still are feared by employers, like the longshoremen, but for the most part, business and government gives unions the back of their hands and tells them what they're going to get. Or do you see a lot of big wage increases these days? What did the Ontario government give its unions last time around? What did Harper give his?

[Argus]

Good, if you pay more in taxes then I'll ever make, stop asking me and others to pay for your retirements. Like I said, stay outta my wallet, and pay for your own GD retirement. And no, defined benefit pension plans are like ponzi schemes, because without Joe and Jane Q taxpayer funding the shortfalls, the system would collapse on itself, because the necessary money that should be contributed from you and others into your plans, doesn't happen. So the bill gets sent to taxpayers. Like I said, if you're making so much money as a government worker, fund your own god damned retirement.

Actually, I'm making so much as a consultant I probably will. But that's neither here nor there. The fact is that the unions negotiated in good faith with the government, and government gave them benefits rather than raises. The unions were willing to accept this, and now the government is liable to make its contributions just as the union members do. Federal employees contribute a substantial portion of their biweekly cheques to their pension fund, which is not as generous as everyone seems to believe.

Basically, you get 2% of your salary for every year worked minus almost the entirety of whatever CPP pension you might one day get. That is to say, you pay for your pension, you pay CPP, and when you collect your pension it gets reduced by whatever your CPP cheque is. That's not 100% accurate but that's the gist of it. So if you put in thirty years you get sixty percent of your salary minus your CPP cheque. But you forego a lot of money over the years to get that.

[TimG]

Once again, you have a strange belief in the mysterious powers of the union.

No mysterious powers required. A union who is able to convince an employer to provide a defined benefit pension plan has two choices. They can accept lower contribution rates with the fiction that the employer will make up any shortfalls or they can assume the risk themselves but would likely have to contribute more. Unions took option 1) because they were greedy and short sighted. They choose not to see the conflict of interest created by making companies responsible for the pensions and they are now paying the price as companies renege via bankruptcy or lobbying. If union bosses had more foresight they would have insisted on a plan that was not dependent on the company but that would have required lower benefits and lower wages.

[DFCaper]

Goverment pension Problems is not unique to Canada Post.

I do not thinl with the shrinking need for mail service, that it doesn't need to be as large of an organization as it is today. I realise that shrinking an organization with a Defined Benefit pension, will result in it losing money as a result of the pension, but do not feel that there is no imediate solution for Canada Post.

I believe that Canada Post should start reducing delivery frequency. I cannot believe that every person needs to recieve the mail everyday. Since volumes of mail are going down, I think we should migrate towards having mail delivered no more than twice a week. Reduce the amount of carriers so that all jobs are still full time. This would reduce Labour costs and future pension liabilities.

I do not believe it would reduce the revenue side of the operation very much but will minimize expense and thus losses. Postal service is still essential and should be governement, but dailly mail is over the top.

[hitops]

And there it is. I'm "economically illiterate" because of your completely disrespectful biases.

It's been true long before I ever worked for that leeching organization, and will be true long after.

So you conclude your post not only with an anecdote--that is, with a rhetorical method so completely unproveable, and un-disproveable, that it is literally completely useless to everyone, and carries literally zero information; and then you pile on by producing the most self-serving, self-aggrandizing anecdote in recent memory--and you don't think it might undermine the rest of your post in any way?

All right, carry on, then.

It also have nothing to do with the point, and is simply an incidental example. It's widely known by folks who work at all levels of gov, that this is standard fare. Believe what you would like. Shutting down departments and shedding employees is the best thing government can do if they have any respect for the taxpayer.

Edited August 30, 2013 by hitops

[hitops]

Once again, you have a strange belief in the mysterious powers of the union. You know, a long time ago, when the world was young, I worked for a security guard company. When the guards unionized, the union tried to negotiate a contract which had some minor benefits and a small increase in wages. The company hired a bunch of new immigrants and simply locked out all its existing guards. The lockout lasted, I think, over a year. I don't recall the exact terms of the result since I was gone by then, but basically the guards got very little.

When you think of the likes of Wal-Mart, which closes stores rather than employ unionized workers, or the big banks, which fires anyone who even mentions the word union you might reconsider just how powerful you think unions are. There are a couple of unions that still are feared by employers, like the longshoremen, but for the most part, business and government gives unions the back of their hands and tells them what they're going to get. Or do you see a lot of big wage increases these days? What did the Ontario government give its unions last time around? What did Harper give his?

Unions have lost sway in some ways recently, but why is this a bad thing? Unions were invented at a time when it was legal to employ children and not compensate people for getting maimed, killed or permanently disabled at work and control their lives like serfs. That time has passed. The role of unions is redundant. If you don't like working for the security company because they pay poor benefits, then form your own security company or contract your own services out, or try a different one, or do something else. If you run your company really well and pay better, the previous company will be forced to raise wages so their employees don't run to you. And the circle of life continues.

The hyperbole people employ in the debate today is ridiculous. It's not hard to find living arrangements that allow you to eat and cloth yourself and sleep under a roof, even with low-wage jobs. This may involve living with family, or a roommate, or living in a small town or making/growing some of your own things, or some other arrangement. But it IS hard to find arrangements where you get a cool condo with granite and stainless, an iphone, bigscreen, cable, hip car and garage, internet, road-trips, vegan groceries and great clothes in the middle of a bumpin' city......with low-wage jobs. We make different choices today and have different priorities, and those priorities have costs.

Edited August 30, 2013 by hitops

[cybercoma]

The problems are the greedy unions

Right. The greedy unions with their $7 per pay check, not the greedy corporations that have rolled back millions in benefits over the last 30 years without supplementing wages to makeup the difference.

[bleeding heart]

How do you know it's mere disrespect and not an accurate observation?

"Everyone around me was a lazy slob, but I, because of my work ethic--foundered on the strong moral steel of conservatism (of course!)--had the work ethic and productivity of two men!"

Yeah, that was merely meant as a sober observation.

[Black Dog]

The hyperbole people employ in the debate today is ridiculous. It's not hard to find living arrangements that allow you to eat and cloth yourself and sleep under a roof, even with low-wage jobs. This may involve living with family, or a roommate, or living in a small town or making/growing some of your own things, or some other arrangement. But it IS hard to find arrangements where you get a cool condo with granite and stainless, an iphone, bigscreen, cable, hip car and garage, internet, road-trips, vegan groceries and great clothes in the middle of a bumpin' city......with low-wage jobs. We make different choices today and have different priorities, and those priorities have costs.

And have you ever had to make any of the choices you describe?

[Icebound]

The basics of the free market system does not apply to government unions because the politicians making promises that impose liabilities on future tax payers which means the normal financial constraints that limit demands in private sector negotiations no longer apply. On top of that the people negotiating on the side of the government often owe their positions to the unions which they are supposed to be negotiating with.

Probably. But then, they do not apply to private companies either.

The Government, like any business, has a forecast of expected revenues and expenditures. They may or may not meet their targets, just like the private business. Presumably both know what they can afford in terms of employee benefits. Yeah, the government can raise taxes. Of course, the private enterprise raises its service rates with no reason either.... We love to talk about "competition", but my main monthly expenses... transportation, communication, heating and energy.... are all increased at will by the provider, so what's the difference?

...

[Argus]

Unions have lost sway in some ways recently, but why is this a bad thing?

Well, for one thing, the unions served as a handy counterweight to corporate influence, and their deminishing influence corresponds to the rise of corporate influence over government and, not incidentally, the fall of wages and benefits for the ordinary worker.

You know, being an investor, I watch the business news a lot. A fellow was commentating the other night about the prospects for economic growth and pointed out that while corporations are flush with cash and have little or no debt, individuals and governments are deep in debt, which will limit growth.

Hmmm. It hasn't always been that way, you know. I wonder if the heavy influence corporations have wielded over the past couple of decades and the subsequent changes to financial regulations and corporate taxes have something to do with that.

If you run your company really well and pay better, the previous company will be forced to raise wages so their employees don't run to you. And the circle of life continues.

Really? Then how come we have a Costco, and we also have a Wal-Mart?

There's only so many people Costco can hire based on sales, and there is nothing in your theory which shows why paying better wages and giving better benefits is going to create vast new demand for Costco which will enable it to run Wal-Mart out of business.

The hyperbole people employ in the debate today is ridiculous. It's not hard to find living arrangements that allow you to eat and cloth yourself and sleep under a roof, even with low-wage jobs.

As long as you don't mind living in a roach motel, I suppose. It's been a long time since I was a security guard, but I would have been hard pressed to even pay for a room on my wages then. Yes, I lived with family, but not everyone has that option. If you were ever poor you've forgotten what it's like. I haven't.

[Argus]

It also have nothing to do with the point, and is simply an incidental example. It's widely known by folks who work at all levels of gov, that this is standard fare.

No, it's not, actually. It's been the cliche for a long time, but the reality isn't quite up to your generalization. I know too many people who work in government who work their asses off, who are extremely responsible and dedicated, and crushed by the heavy workload. That's not to say there aren't lazy people, but like anywhere else, there is every kind of person in government, and the average worker is, well, average in how hard they work.

[Shady]

Anyways, Canada Post needs to be privatized, just like air traffic controllers were. The government has better things to be involved in than mail and package sending.

[hitops]

And have you ever had to make any of the choices you describe?

Yes, and continue to do so (though now by choice). I also remember when some of those things just were not available, and if you can imagine, I managed to maintain respiration and a pulse despite.

But that's beside the point. A lot of things are unpleasant. That doesn't mean you should make it easier at the cost of making it harder for others, purely basis that one guy works for gov and the other doesn't.

Edited August 31, 2013 by hitops

[hitops]

Well, for one thing, the unions served as a handy counterweight to corporate influence, and their deminishing influence corresponds to the rise of corporate influence over government and, not incidentally, the fall of wages and benefits for the ordinary worker.

You know, being an investor, I watch the business news a lot. A fellow was commentating the other night about the prospects for economic growth and pointed out that while corporations are flush with cash and have little or no debt, individuals and governments are deep in debt, which will limit growth.

Hmmm. It hasn't always been that way, you know. I wonder if the heavy influence corporations have wielded over the past couple of decades and the subsequent changes to financial regulations and corporate taxes have something to do with that.

Really? Then how come we have a Costco, and we also have a Wal-Mart?

There's only so many people Costco can hire based on sales, and there is nothing in your theory which shows why paying better wages and giving better benefits is going to create vast new demand for Costco which will enable it to run Wal-Mart out of business.

As long as you don't mind living in a roach motel, I suppose. It's been a long time since I was a security guard, but I would have been hard pressed to even pay for a room on my wages then. Yes, I lived with family, but not everyone has that option. If you were ever poor you've forgotten what it's like. I haven't.

Corporations are indeed flush with cash....but why would they use it? The fact that personal and government debt is so high is exactly why it would be risky to do so. Gov overspending means gov will be ever more tempted to try to take from corporate in any way they can, and when everyone is maxed out there is no disposable income to church things along. Corporations, or even just very wealthy people, are not stupid. The reason to use capital is not because you have it, but because it has a chance of making more money. If you have billions but gov can't decide what your tax rate is, whether to print money, whether to borrow endlessly etc, whether to make new laws that cost you etc, that means 'danger, save money to prepare', not 'build factories.'

We have costco and wal-mart because they cater to different groups, with some overlap. It's an interesting example though, since Costco just came out on top of a survey of customer opinions of businesses. They have their markets, and that's how the market works. If you don't want to work for Wal-mart, then apply for Costco. Don't like either? Go somewhere else, or start your own. It's a free country, you don't have to shop at Wal-mart, or even work for it.

You can work for minimum wage and and rent a 500 sqft bachelor pad in a cheap area, and buy food and live just fine. In downtown Toronto? So move, it's not like minimum wage is a selective group of jobs only available in one particular area. Take some responsibility. Take a small student loan and do 12 months of technical training and start plumbing. Don't have kids you can't afford. The reality is that people want to live in certain areas, have certain conveniences, be free to make any lifestyle choice and associate with certain people, and those things have costs. But those are all choices, not some kind of divine persecution which others should pay for.

Edited August 31, 2013 by hitops

[Argus]

Corporations are indeed flush with cash....but why would they use it? The fact that personal and government debt is so high is exactly why it would be risky to do so. Gov overspending means gov will be ever more tempted to try to take from corporate in any way they can,

Sorry, but recent history does not bear this out at all. Quite the contrary. I'll use US figures as they're more easy to locate, and they show that while corporate profits have risen by 400% over the last twenty years, corporate taxes have fallen by 50%. And the trend on corporate taxation continues to be downward. Decades ago corporations paid, if not as much as individuals, at least in the same neighborhood, as a share of total income taxes. It's now at an all time low. Average corporat taxes in the US are now below 13%.

Further, the term 'overspending' implies just that, spending more than you tax. Again, is overspending a result of imprudent spending or imprudent taxation policy which has consistently lowered taxes, especially for corporations. If government is starved of funds due to the influence of corporate lobbying and donations it's not surprising that they are 'overspending'. But of course, governments have things they are required to spend on, be it the military or pensions or health care. So who has to make up the difference now that corporations have stopped paying for things? Well, the individuals, of course. Thus while corporation share of taxation dwindles individual taxes must rise to try and make up for it. Then come the cutbacks, not to corporations, but to services for individuals. So individuals pay more than they used to, not just in taxes but in various surcharges, while getting less and less back. Corporations, meanwhile, are 'flush with cash', and sitting pretty.

http://aneconomicsense.com/2013/07/07/taxes-on-corporate-profits-low-falling-for-decades-and-now-close-to-a-voluntary-tax/

http://www.alternet.org/economy/ayn-rand-usa-20-years-corporate-profits-are-4x-and-their-taxes-have-fallen-50-meanwhile

If you don't want to work for Wal-mart, then apply for Costco. Don't like either? Go somewhere else, or start your own. It's a free country, you don't have to shop at Wal-mart, or even work for it.

I do neither, but that's not the point. Not everyone can work for Costco, so the suggestion that an employer who paid better wages would require others to pay better wages is imply easily disproved.

Edited August 31, 2013 by Argus

[Icebound]

. Thus while corporation share of taxation dwindles individual taxes must rise to try and make up for it. Then come the cutbacks, not to corporations, but to services for individuals. So individuals pay more than they used to, not just in taxes but in various surcharges, while getting less and less back. Corporations, meanwhile, are 'flush with cash', and sitting pretty.

+1

...increasing the ever-increasing gap between rich and poor.

I think Karl Denninger: Leverage has it right. Time to stock up

...

[hitops]

Sorry, but recent history does not bear this out at all. Quite the contrary. I'll use US figures as they're more easy to locate, and they show that while corporate profits have risen by 400% over the last twenty years, corporate taxes have fallen by 50%. And the trend on corporate taxation continues to be downward. Decades ago corporations paid, if not as much as individuals, at least in the same neighborhood, as a share of total income taxes. It's now at an all time low. Average corporate taxes in the US are now below 13%.

Further, the term 'overspending' implies just that, spending more than you tax. Again, is overspending a result of imprudent spending or imprudent taxation policy which has consistently lowered taxes, especially for corporations. If government is starved of funds due to the influence of corporate lobbying and donations it's not surprising that they are 'overspending'. But of course, governments have things they are required to spend on, be it the military or pensions or health care. So who has to make up the difference now that corporations have stopped paying for things? Well, the individuals, of course. Thus while corporation share of taxation dwindles individual taxes must rise to try and make up for it. Then come the cutbacks, not to corporations, but to services for individuals. So individuals pay more than they used to, not just in taxes but in various surcharges, while getting less and less back. Corporations, meanwhile, are 'flush with cash', and sitting pretty.

http://aneconomicsense.com/2013/07/07/taxes-on-corporate-profits-low-falling-for-decades-and-now-close-to-a-voluntary-tax/

http://www.alternet.org/economy/ayn-rand-usa-20-years-corporate-profits-are-4x-and-their-taxes-have-fallen-50-meanwhile

I do neither, but that's not the point. Not everyone can work for Costco, so the suggestion that an employer who paid better wages would require others to pay better wages is imply easily disproved.

I would respond point by point, but not really sure how on this forum. I can't seem to divide up your paragraphs. Any advice appreciated.

Regarding corporate taxation - the fact that the rate has fallen is irrelevant to the point. Things are volatile, the US gov has borrowed unimaginable sums of money that requires crisis over every debt ceiling, and the EPA and other organizations are constantly threatening to legislate industries out of business. I have no idea why any rational business owner would see this as a good time to invest or build. It makes perfect sense they would hold back. Nobody gets rich off money sitting in a corporation. If it makes economic sense to use it, they will use it. When you have a president wandering around talking about policies that will make it harder to do business, manipulating your currency and saddling you complicated health obligations, it makes absolutely no sense to take risks. If you personally have a huge cost in your life possibly coming up, that makes you less likely to redo your kitchen, not more.

The questions of imprudent spending or taxation is moot. The most highly taxed nations on earth can't balance their budgets. That pretty much puts that to bed. There is no amount of taxation that is ever enough for a government. They do not see increased taxation revenues as a welcome catch-up for their budget, they see it as a pass to borrow even more and go into more debt.

Employers paying better wages to compete is a simply reality that happens every day. North Dakota being a prime example, where it's close to impossible to get people working at McDonalds and Wal-Mart because of the other options. If you don't want to work at Wal-Mart, then work at Costco. If there are no jobs, start your own company, hire people and pay them great if you want and see if you can compete. Wal-mart survives because it has a good business model. They are the largest employer in the US. That's better overall for the US than employing half the people at better wages.

Edited September 1, 2013 by hitops

[Argus]

I would respond point by point, but not really sure how on this forum. I can't seem to divide up your paragraphs. Any advice appreciated.

They completely screwed up the last software update, so the quote feature doesn't work. What you have to do is, after hitting reply, go up to the top left corner of the frame, where the "B" for bold is. Just above it is a small box which removes the encoding. You hit that, then you can divide up the text you want to reply to. Of course, you won't have access to any formating functions then. What you need to do is manully input or cut and past the quote and /quote functions around the quoted text.

[Topaz]

Actually, I'm making so much as a consultant I probably will. But that's neither here nor there. The fact is that the unions negotiated in good faith with the government, and government gave them benefits rather than raises. The unions were willing to accept this, and now the government is liable to make its contributions just as the union members do. Federal employees contribute a substantial portion of their biweekly cheques to their pension fund, which is not as generous as everyone seems to believe.

Basically, you get 2% of your salary for every year worked minus almost the entirety of whatever CPP pension you might one day get. That is to say, you pay for your pension, you pay CPP, and when you collect your pension it gets reduced by whatever your CPP cheque is. That's not 100% accurate but that's the gist of it. So if you put in thirty years you get sixty percent of your salary minus your CPP cheque. But you forego a lot of money over the years to get that.

I agree with you and I know of a union, knowly or unknowly to members, they gave up CPP and OAS to keep the US company in Canada, but five years later the company left and the junior members when they retire will lose about 1100. monthly, now that's stupid.

[Argus]

Regarding corporate taxation - the fact that the rate has fallen is irrelevant to the point. Things are volatile, the US gov has borrowed unimaginable sums of money that requires crisis over every debt ceiling, and the EPA and other organizations are constantly threatening to legislate industries out of business. I have no idea why any rational business owner would see this as a good time to invest or build.

Maybe you missed the part about a 400% increase in corporate profits and getting their taxes cut in half?

My point is that if corporations were paying at the same rate as they used to the government would not need to be borrowing huge sums of cash to pay the bills.

And corporations have been whining about government regulation forever. But without an EPA, if you'll recall, they simply dumped the most toxic stuff imaginable into the environment without care or concern. Just like Wall Street was continually paying off politicians to dismantle regulatory agencies by stating they had no need of them and those agencies were a hindrance. Well, we saw in 2008 what Wall Street would get up to without any government oversight.

The questions of imprudent spending or taxation is moot. The most highly taxed nations on earth can't balance their budgets.

I think the most highly taxed nations are the Nordic nations, and all of them either have budget surpluses or very small deficits. Their national debt loads are mostly a half to a third that of the US or Canada (by gdp).

Employers paying better wages to compete is a simply reality that happens every day.

ONLY in a low unemployment environment where it's difficult to find employees. In times of higher unemployment (or if they can simply bring in cheap foreign labour) there is no pressure whatever to raise wages. Which is one of the reasons corporate America and corporate Canada aren't unduly bothered by high unemployment.

[Smallc]

I agree with you and I know of a union, knowly or unknowly to members, they gave up CPP and OAS to keep the US company in Canada,

I don't know if that's even possible to do.

[hitops]

I agree with you and I know of a union, knowly or unknowly to members, they gave up CPP and OAS to keep the US company in Canada, but five years later the company left and the junior members when they retire will lose about 1100. monthly, now that's stupid.

No, paying wages to a bunch of people for 5 move years is better than laying them all off 5 years earlier. That's 5 additional years of wages and tax collection for x number of jobs compared to what would have been.

[hitops]

Maybe you missed the part about a 400% increase in corporate profits and getting their taxes cut in half?

My point is that if corporations were paying at the same rate as they used to the government would not need to be borrowing huge sums of cash to pay the bills.

All corporations will always want lower taxes, just like all people will. That has nothing to do with whether it makes sense to invest, and right now it does not. You make more money by investing capital than by sitting on it or pulling it out for exec salaries (because then it gets taxed at top marginal personal rates). So if it mades sense to invest it, they would. The only time it makes sense to sit on billions is when the alternative is worse. That time is now.

Well, we saw in 2008 what Wall Street would get up to without any government oversight.

There was not only oversight, but government bureaucracy directly telling banks how to behave which led up to the crisis. It started with the community reinvestment act under Clinton. This was based on people feeling bad that minorities got fewer loans. The answer? Social engineering of course - an act that forced banks to give x% to minorities no matter the (bad) risk. What about the risk to banks? Don't worry - Fannie and Freddie would back it. So it happened. And culminated in 2008. This is the direct result of government forcing behaviour x and trying to remove the risk, distorting the market.

I think the most highly taxed nations are the Nordic nations, and all of them either have budget surpluses or very small deficits. Their national debt loads are mostly a half to a third that of the US or Canada (by gdp).

The only nordic nation running a surplus is Norway, because they are a petro-state. They are on the list of nations running surplus, which is nearly without exception all petro-states.

ONLY in a low unemployment environment where it's difficult to find employees. In times of higher unemployment (or if they can simply bring in cheap foreign labour) there is no pressure whatever to raise wages. Which is one of the reasons corporate America and corporate Canada aren't unduly bothered by high unemployment.

From a labor point of view they are not. But ultimately lower employment means fewer people buying the stuff you make or the services you provide, which means lower profits. Wages need to be able to move with employment, because that's how employment is best adjusted, and how wealth is most efficiently redistributed to the most people. France has crazy benefits and protections of workers, and the result has been permanent, endemic unemployment. The rate is 25% for a new a new university grad. You don't want to know what it is for those with only high school.

Edited September 3, 2013 by hitops