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Wednesday Night Salon
# 1210 page2 May 11th, 2005
first draft
intro Wed1210 | Slide show for 1210
Wednesday Night Salon # 1210
May 11th, 2005
Introduction
This was an unusually crowded Wednesday Night gathering, attracted by the possibility of meeting a real-life Westmount Conservative, and at the same time, the opportunity to hear EDC's economic guru, Stephen Poloz on the state of the nation. The varied interests and professional backgrounds of the participants ensured a particularly lively discussion which focused on those two topics.
A vote of confidence?
What has happened to our country and to our province? Every four to five years or so, we entrust a good part of our future, our earned income and our collective well-being to men and women who claim to have selflessly offered themselves as a sacrifice in order to look after our interest with intelligence and integrity. As for integrity, while Mr. Martin may very well claim that the allegations of blatant misuse of the money entrusted to the government by the electorate have been opened to public investigation and scrutiny, one is led to question whether the timing of the twenty-one billion dollar projected expenditures on social programs ["Federal government spending announcements have hit $22,349,642,360 since Paul Martin went on television on April 21 to apologize for the Liberal sponsorship scandal", reports the National Post] might be considered more a measure to use the public purse to fund a re-election campaign than part of a coordinated planned effort to further the common weal. In contrast the $103 million cut from student bursaries in Quebec seems a mere pittance and one wonders why it took such prolonged action by the students to have it restored.
As for the Conservative Party, the continuous roadblocks to the functioning of Parliament appear to the public to be more opportunistic than in the best interest of that portion of the electorate that it represents. Certainly the opposition has the duty to highlight the flaws of the party in power, but the ongoing obstruction to the work of the Commons does not enhance their image as a party of integrity. The highlights of the Conservative platform, hammered out at the recent policy convention in Montreal, have been stated as inclusiveness, accountable government, fiscal responsibility and addressing the problem of fiscal imbalance. Certainly, no one can argue with inclusiveness, accountable government or fiscal responsibility, which fit nicely into the category of motherhood and apple pie, but the fiscal imbalance issue, while laudable, causes some uneasiness among some federalist Québec voters who are reminded of the close relationship between the Conservative and Bloc caucuses in their haste to topple the government.
Sadly, the only reasoned player who, by his actions and words, offers real contrast to the elected members of the other three parties, is taking a leave of absence due to the illness of his wife. Only Ed Broadbent has appealed for civility, decorum, and reason in the House.
[Editor's note: We would further point out that Jack Layton appears to be following in Ed Broadbent's footsteps. As Maisonneuve Magazine's Jonathan Montpetit said on Wednesday morning in his commentary on the CTV/Globe and Mail poll "61 percent of Canadians feel Prime Minister Paul Martin is likely to lie, only a small percentage feel NDP Leader Jack Layton is either hypocritical or likely to lie… Out of the four leaders, Layton is the one most people would want to have supper with. What this all means in terms of electoral fortunes, however, is anybody’s guess … Unfortunately for Layton, voters don’t usually put one’s potential as a dinner guest at the top of their mind when they head to the ballot box.
… In the war for personality, Layton is the runaway winner. Come election time, that could go a long way in a campaign that is shaping up to be a choice between lesser evils for many Canadians…. taking the high road these days is bound to pay dividends. Witness Layton’s comments to the media on Monday, when Canada’s political leaders showed up a day late for VE Day ceremonies in the Netherlands. The ceremony was barely finished before they all started blaming each other for giving veterans the shaft. Layton, meanwhile, decided to play the integrity card and accepted some of the blame himself. It’s a novel approach, … yet it’s an effective way for a leader to distinguish his party from the riff-raff."]
It appears to most observers that the Conservative Party has an ill-defined image. While some fear that the Conservatives are moving too close to the centre and thus offer little contrast to the Liberals, others express concerns that the Conservatives in their anxiety to differentiate themselves from the Liberals would jettison much that is good in the proposed Budget. The great challenge, however, will be to restore the finances of the country to the healthy state enjoyed when Paul Martin was Minister of Finance (fully supported in his actions by Jean Chrétien, be it remembered), while responding to the variety of (legitimate) demands of the citizenry. Among the most pressing needs is that of addressing the current punitive tax system that discourages wealth creation and productivity.
Whatever their views, it appears to many that the Conservatives have failed so far to make clear what the Party IS, despite the platform that was agreed at the Policy Convention. In response, supporters of the Party urge the sceptics to refer to the Conservative PartyWebsite, where all will be revealed.
Current estimates place the post-election government across a wide spectrum from minority Liberal to majority Conservative. It is to be hoped that whatever the makeup of the Commons it will succeed in regaining the confidence of the electorate, especially in Québec, which faces a critical time in its political life regardless of the outcome.
The economy
Although there is the temptation to link the recent decline in the Canadian dollar to the political gamesmanship currently being played out on the floor of the House of Commons, objective observation contradicts that view. In fact, all world currencies have declined simultaneously and by about the same amount. Canada is now a petrocurrency and the fluctuations of the Canadian dollar are more likely to reflect fluctuations in the price of oil. Commodity prices are easing as the world is slowing down (as it should) and interest rates remain stable. The Canadian dollar can be expected to decline to between seventy-seven and seventy-nine cents U.S. over the next twelve months. The U.S. trade deficit is not considered to be as serious as it appears as, with ever-increasing globalization of U.S. industry, much of these deficits occur within U.S. companies.
With increasing petroleum prices, the Alberta Tar Sands have come into prominence. Oil reserves exceed those of Saudi Arabia, with estimates of up to a century of world supply of oil, but the exploitation of the full extent of the reserves will depend on the price of oil – the lower-grade oil, which is deeper, is more costly to bring up. With an expected drift downwards of the cost of oil (+/- $45 this year, $40 next year), Canada can expect a fairly major productivity upturn, and with a stronger oil industry, the dollar could well rise to 90 cents in the next cycle. The cost of extraction is currently between $16 and $14, although some quote it as low as eleven dollars a barrel, making this enormous petroleum source increasingly profitable. Other observers suggest that some energy cost models estimate that extraction costs for the tar sands will not go below $50 bbl.
Some economists express concern that the advent of the Tar Sands bonanza will lull Canada into a false sense of security and have an adverse effect on productivity. It might be added that there is wide variance in estimates of environmental costs associated with the exploitation of the Tar Sands and finally, there was no voice this evening to invoke Hubbert’s Peak . What is undisputed is that the higher the price of oil, the more reserve is recoverable.
From Wed 1 Dec 2004 Wed 1187
[Editor's Note: In 1956, M. King Hubbert predicted that U.S. oil production would peak in the early 1970's. Although Hubbert was widely criticized by some oil experts and economists, in 1971 Hubbert's prediction came true. The 100-year period when most of the world's oil is being discovered became known as "Hubbert's Peak." The peak stands in contrast to the hundreds of millions of years the oil deposits took to form. Hubbert's methods predict a peak in world oil production less than five years away See:Hubbert and/orHubbertpeak.com/ ]
Predictions of Canadian economic growth for this year range from a high of 2.4% (lower than the Bank of Canada predictions) to 2.8%, with closer to 3% next year. The world economy is slowing down noticeably (Japan and Europe have been slow for 15 years) this year after a surprising increase of 5% last year. Predictions of inflation next year range from zero to 2%.
Canada is not a productivity-oriented country. There is still a lot of work to be done to strengthen the economy, and there are a lot of demands on the treasury. At the end of the day, there is no evidence that society wants to cut spending, especially on healthcare, cities, the environment, etc. There needs to be a real strategy for this economy, which is still in an uphill climb.
In calculating the effects of the Gomery Commision
See Martin, vs Chrétien .
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In the spirit, but not the intent of the Economist quote “WE TEND to meet any new situation in life by reorganising, ...” we would call your attention to a new development of the WN Salon Summary pages. Given the devoted following generated by Jacques Clément's Reports on the Economy, we have decided that they should be published on their own special pages and will thus be linking to the collected oeuvre each week.
UNITED STATES
Current Beige Book
Dec. 1, 2004 Fed reports growth in 11 of 12 regions Beige Book: Retail mixed, jobs improve, price pressure up
Note
Wednesday-Night creates charts and follows stocks, including timely related financial news items, in which Wednesday Nighters are interested and in order to demonstrate a service that could eventually be developed and marketed. Wednesday Nighters are invited to participate and help to test the service.
see WN Flip charts
QUOTES of the EVENING from recent Wednesday Nights
From #1210
- This is a country and a province that is not productivity-oriented
- We see a risk on the horizon for Canada and it is the tar sands because it takes our minds off productivity growth
- In the last election Liberal voters in Quebec wanted to punish the Liberals; they still want to punish the Liberals for their flagrant misuse of public monies, but this time, they should have a viable alternative – the one offered by the new inclusive Conservative Party that reflects their interests and their communities
- The Bloc is the Conservative Party in Québec … the NDP is the protest vote
- The worst of all results would be a strong Conservative government in Ottawa with no representation from Québec
- Why should we vote for (the Conservative Party)? What message (do they convey) other than ‘throw the bums out'?
(The Conservatives party has) signed a pact with the devil ... won’t fly in Westmount
- I am always delighted when an election is called so that we can welcome [Lucienne Robillard] back to Westmount
- The party in power gets its hands dirty
- In the last election, we said what we stood for and nobody believed us
From #1209
- We should try to imagine a world 20 years from now if the rate of consumption continues to increase, where the rest of the world cannot participate at all, where deaths from AIDS in Africa continue at the same rate – what could possibly make that world stable? How can we possibly live in that world?
- “In American universities, Russian teachers teach Chinese Students.”
- “It’s a shame that the same logic not taught in political science (as is taught in computer science).”
- You can’t say the Americans are the good guys and the others are the bad guys
- The rest of the world is buying up [American] assets at the rate of almost 2 billion dollars a day – this cannot continue without consequences
- Extremism comes from educated people who have learned to use the disaffection of millions of people
- If you were sitting in Falluja or in Hiroshima, whom would you have called the terrorist?
- American culture thrives on paranoia. ... but, they never have been paranoid about their own guns and their own cars
- I am surprised that you downplay the role of Muslim fundamentalists
We avoid labelling any minority group as terrorists because it is not politically correct
- They used to think that only young hearts were acceptable, but they have come to the conclusion that a fifty-year old person in need of a transplant could use the heart of a fifty year old
Past Quotes Best or All
Notes by Herbert Bercovitz OWN & Edited by Diana Thébaud Nicholson OWN
2005 W-N Links for #1210
Please click for Jacques Clément's Report
Wednesday May 4, 2005 Beryl Wajsman, a political and community organizer. Brault said he was pressured to put Wajsman on Groupaction's payroll at $5,000 a month cash.
"Rose Haiku for flower lovers and gardeners". The editor is Angela Leuck, who, in another life is a brilliant economist. The book is utterly charming and would make a great Mother's Day or other gift in the month of May - or any other time!
see David Price @pricepatterson.com (514) 935-4537
Wednesday May 4, 2005 Thanks David!
And thanks so much for coming to Angela's book launch. It was a success in no small part because you and Diana promoted it. Her publisher told her "You delivered" - so it seems he will continue to work on her behalf. I'm so happy for her. Thanks again.
Love June
 Stephen S. Poloz VP EDC Economics Weekly Commentary
Global Textile Market Now Facing Reality - May 4, 2005
That shirt you are wearing – where was it made? There are many possible countries, but many of them see their businesses under threat, now that the Multi-Fibre Agreement has come to an end.
Past issues | his WN page
2005 Notes for #1210
A new face
Lori Mengri comes from Albania where she got her first law degree and then practiced corporate law for 3 years in Albania with an Italian-America multinational law firm.
She then did her LLM in Columbus Ohio and after she got her degree went to Kosovo.
There she worked for the American Bar Association then the World Bank and then the EU for about 4 years.
From Kosovo she came to Canada less than 2 years ago to get her LLM from McGill in International Law.
She is now looking for opportunities to practice law for a human rights organization.
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click for Wednesday-Night Story by Terry Jones
![[English ver]](images/en.gif) Stephanie Lalut on W-N
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