If there ever had been any doubt about Wednesday Night as a microcosm, that doubt was laid to rest this week with the animated presentation of a broad spectrum of conflicting social, political and economic views on a single topic, all expressed in a friendly, amiable manner. The proposed merger of Telus and BCE provided a timely example
[Editor's note: albeit now more likely only a footnote to corporate Canada history]. Is selling BCE good for the country? Bell is not good for consumers today; if in order to retain its Canadian identity, it becomes a larger monopoly, things would surely only get worse.
Canada was developed economically by foreign, albeit colonial investment and has prospered but for any country to be successful, it must also be capable of generating its own development for that time when foreigners lose interest. With increasing prosperity, Canadians have invested abroad but done little to encourage the development of homegrown leaders, CEOs and entrepreneurs in an increasingly global marketplace. Having home-grown international multinationals is Canada's best defense in a globalized world. The public policy framework (protection) has worked against such development, but there is also a cultural deterrent: Canadian business leaders show little confidence in their own brand(s), and their ability to compete in international markets with a premium product.
Why Mexicans Don't Drink Molson – an analysis of Canadians' failure to compete internationally by Andrea Mandel-Campbell
Although Canadians invest at home and abroad, there are too few Canadian-owned and operated companies producing here and exporting to world markets, and even fewer who are prepared to compete on the world market for quality rather than price. Cirque du Soleil (which has recently announced a new home in Dubai) should serve as the template for what it is possible to achieve with creativity, excellent branding and global vision. Canada’s failure to shine on the international scene is blamed on the cultural makeup of Canadians and poor public policies. It is up to the government to promote a competitive environment rather than protect uncompetitive enterprises solely because they are Canadian. It is acceptable that the government insist on Canadian content in radio and television broadcasts, but not acceptable that it restrict competition between domestic and foreign broadcasters. We do not seem to differentiate between protection and stimulation of culture.
As Canadians, we tend to view ourselves as the epitome of having achieved a balance between quality of life, prosperity, modesty and caring for the less fortunate, as opposed to the United States, the image of unregulated business and opportunity for the wealthy at the expense of the impoverished. The truth of the matter is that although multiculturalism and peaceful coexistence of two official languages is a Canadian achievement, and that the U.S. has been an early leader of the world trend to internationalism, they are only examples and do not represent the entire planet.
Leadership
Failure to promote the entrepreneurial spirit, and making investment in Canada by creative Canadians difficult, represents the other side of the coin. There is little evidence of an environment that encourages the development of creative, committed business leaders, although such initiatives as Action Canada, a public-private partnership investment in young, highly motivated Canadians who have already begun to demonstrate leadership, are showing encouraging results. One example which was highlighted was a recent Action Canada (AC) project carried out by five young AC fellows on Unlocking Innovations from Within Canadian Universities – a critique of the relationship of venture investors and university Technology Transfer Offices
Please see our invitation page Wed1321.asp for more links a images
Venture capital – or the lack thereof – is an essential part of the topic of Canadian competitiveness. Too often, small companies with big ideas have been turned away by Canadian investors to find a warm welcome and swift response in the U.S. The biotechnology sector requires particularly deep pockets, as llustrated by the case of Genizon BioSciences , a Québec-based company that is conducting important investigation into the gene pool of The Quebec Founder Population which is relatively undiluted compared with general populations, and therefore making gene discovery easier and less expensive. Although First Round financing came from such Québec institutions as Desjardins, today funding is principally from Sweden and the CEO is British.
The capital gains tax yields relatively little revenue, [less rhan 3%] while acting as a deterrent to wealthy families to pass on family-owned enterprises to the next generation, and/or fund cultural and social endeavors such as museums, libraries and foreign aid. While such funding by government has been successful in England, France and in other, mostly European countries, the probability of government-funded cultural institutions being well built within budget in this country is not likely.
Marketing Boards guarantee a comfortable lifestyle for quota holders but capital gains tax discourages the succession of capital from one generation to the next. Farm production quotas are sold, the intergenerational accumulation of wealth, discouraged, in the long term, to the detriment of the farm community. Australia and New Zealand have eliminated the system by buying out quota holders and eliminating protection for these producers. In the short term, the farmers suffered, but the elimination of the protective mantle necessitated a more aggressive, creative entrepreneurial approach, ultimately leading to higher income and the development of a lucrative, expanding export market.
Footnotes to the evening's exchange:
It is claimed that a more regulated government provides greater equality in economics, that the countries that have the greatest economic equality are the ones with the least freedom.
The type of electoral system is determinant of income distribution. Countries with proportional representation have the lowest income.
We attempt to reconcile irreconcilable differences, disparity, between high and low income, but how do you accumulate adequate pools of money to act as an incentive to business? There is some social inequality that is deserved and some that is undeserved. How can you replace revenue from income and capital gains taxes? The answer is higher consumer taxes, a more logical, productive source of government revenue.
Editor's note David Mitchell OWN recently forwarded the following item by the Toronto Star business columnist David Olive on corporate taxation (not to be confused with capital gains, but still pertinent to the discussion):
Hollowing out: The tax angle. "What is it that prevents Canada from being one of the best places to headquarter and build a business?" Gwyn Morgan asks in a recent column in a competing newspaper. Well, the biggest impediment, according to the former CEO of Calgary's EnCana Corp., biggest independent player in the North American oilpatch, is that "Canadian corporate tax policy is simply uncompetitive with other desirable head-office locations."
Like, for instance, Denmark, home of Carlsberg A/S (2005 corporate tax rate, 5.64 per cent); Belgium, head-office location for InBev SA, world's biggest brewer (4.03 per cent); Luxembourg, head office of Mittal Arcelor SA, world's biggest steelmaker (5.49 per cent); Spain, home of two of Europe's largest banks, which also increasingly dominate South America (4.12 per cent); Australia, home of buyout behemoth Macquarie Bank Ltd. and BHP PLC, world's biggest mining firm (4.5 per cent); South Korea, head-office location for Hyundai Motor Co. (4.19 per cent); and, of course, Japan, home of Toyota Motor Corp., Honda Motor Co. and Sony Corp. (4.1 per cent).
Oh, you were asking about Canada, home of the Fraser Institute, of which Morgan is a longtime supporter and whose "research" he frequently cites. Canada's 2005 corporate tax rate was 3.95 percent in the latest OECD survey.
Thursday 28 June 2007 Flaherty pushes plan for national securities regulator ... Only Ontario, which is home to Canada's largest stock market and its largest provincial securities commission, supported the federal minister. Mr. Flaherty said the passport system is a step forward but declared it is inadequate because it still leaves in place 13 regulators with 13 sets of laws and 13 sets of fees.
In addition, he said, Canada needs to join in the global movement toward free trade in securities and to do this it must have a single regulator. [about time!]
Dear Diana and David,
Thank you so much for the invitation. I found the evening insightful and thought provoking. I apologize for leaving before the end of the evening but I needed to be at the airport this morning at 5:00 am for a 6:30 am flight. I look forward to reading the book over my holidays.
Thanks again.
Regards, Brigitte
June 25, 2007 The Economist Tories Loved, Then Silenced Mark Jaccard's [Simon Fraser University] tough takes on global warming. Jaccard upset many environmentalists in the spring when he argued that it's too late for Canada to reach its targets under the Kyoto Accord. But he pleased federal Environment Minister John Baird -- who also says that Kyoto is a lost cause.study [pdf] for the C.D. Howe Institute that concluded that the federal Conservative government's plans to reduce greenhouse gases won't come anywhere near their targets.
...Although the Greens, along with the other opposition parties, argue that Canada's Kyoto targets can still be met, which puts them at odds with Jaccard and his team on that
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 Wednesday-Night.com Flip charts
QUOTES of the EVENING from recent Wednesday Nights
Because it's an all-Canadian deal does not make it a good thing, because Canadian companies can screw Canadians as easily as international companies can. Look at our banks – they don't charge ATM fees in the U.S. because they have to compete; they charge Canadians because they don't have to compete.
The government's job should be fomenting a business environment, not concentrating on foreign ownership and regulations
The essence of Canada is our social order (subsidized education, culture, medicine) and that requires higher taxation
I don't think globalization will last – our society is rapidly reaching a Tower of Babel
If you have to subsidize culture, it's not worth having
I think we are over-regulated in education, in public health, in all sectors except the economy where we are under-regulated
Why do people fail to make the link between having a strong economy and being able to afford the things you want (education, healthcare, social programs), for which you need a strong tax base
What would it take for Canadians to rise up and demand the change that in policies that would be required – there is no perceived crisis in an economy that is performing well
The amount of investment by Canadian companies in the U.S. is just about the same as the amount invested by U.S. companies in Canada (proportionate to the size of the economy)
With the amount of multinational investment, the concept of corporate ownership by American or Canadian companies is becoming less relevant
What kind of environment is Canada creating to foster Canadian business leaders?
What is lacking is long-term vision which current industrial policy doesn't encourage
We must ensure that in each generation we expropriate a considerable proportion of acquired wealth in order to preserve equality
Think of what would have happened had the Americans or Japanese interests bought Northern Telecom six years ago – there would have been a national outcry. In retrospect, wouldn't it have been great to see Nortel in someone else's hands?
Stalinism and Maoism have failed; Communism has never yet been tried
Stimulation versus protectionism
Investors are demanding corporate social responsibility – environment, healthcare, support for culture … and corporations are responding, whether or not they are Canadian
July 15, 2007 The Richest of the Rich, Proud of a New Gilded AgeMbr>The tributes to Sanford I. Weill line the walls of the carpeted hallway that leads to his skyscraper office, with its panoramic view of Central Park. A dozen framed magazine covers, their colors as vivid as an Andy Warhol painting, are the most arresting. Each heralds Mr. Weill’s genius in assembling Citigroup into the most powerful financial institution since the House of Morgan a century ago. [audios]
Tuesday 03 July 2007 Feds find a cheesy way to rip off consumers It was not exactly a story that galvanized the Canadian public last week. In fact, it certainly couldn't compete with Paris Hilton getting out of jail. But the Canadian Food Inspection Agency's plan to change the regulations about production of different cheeses in Canada is, alas, not mere government busy-work but rather yet another case of Ottawa pandering to Canada's powerful dairy lobby.
Monday 02 July 2007 ts Canada stories 239,100 jobs `gone for good'
OTTAWA–An average of 190 good-paying manufacturing jobs are disappearing in Canada every day – most of them in Ontario.
NO INNOVATION PLEASE—WE’RE CANADIAN by Daniel Tencer
June 13, 2007
Canada
has long seen itself as a land of equal opportunity, a place where peace-loving
people from all over the world can come to build a better life for themselves
under the protective wings of a compassionate and responsive society. Our
high standard of living, our universal health care and our progressive and
sometimes experimental social policies were to be the envy of the rest of the
world. But a new report from the Conference Board of Canada casts a shadow
over all of that. There is something else, the report suggests, something
lurking in the national character, something that manifests itself in a lack
of innovative thinking, a lack of initiative, an aversion to risk—and
if left unchecked, it may threaten our way of life. Both the
Globe and the
Post front the Conference Board’s scathing report this morning,
which ranks Canada
poorly in a comparison of sixteen other developed countries. While we score
reasonably well on education and skills (third place), we fall in the middle
of the pack when it comes to health and the economy—and we place a
miserable fourteenth when it comes to innovation. Our university professors
aren’t publishing as much as those in other countries; we’re not
filing as many patents as other countries; and the lack of foreign investment
means good ideas from abroad aren’t reaching Canada. And all of this
will have an effect, in the long run, on our standard of living, our ability
to create well-paying jobs and, by association, our national self-esteem.
Bloggers,
TV talking heads and newspaper columnists will soon seize on this report;
those who lean right will argue that we need lower taxes and more economic
freedom; those on the left will argue we need stronger government guidance
and spending on research and development. Others yet will argue the report is
unfair and alarmist. Yet the evidence of this problem is everywhere: While
the UK, France and Germany
work on concrete ways to address climate change, we argue over oil revenue
(see below); while China
and India hurry to open
their economies to the global market, Canadafrets
over foreign investment. Perhaps the problem is one of success causing
failure. The increase in commodity prices in the past half-decade has made Canada’s
natural resource-rich economy a cash cow. We haven’t taken risks and
innovated because we haven’t had to; we’ve sat on our laurels and
watched the cash pour in. Ultimately, the Conference Board’s
report’s true value lies in pointing out the startlingly obvious: That
digging for oil and arguing over transfer payments is no way to build a
twenty-first century society. It’s time for Canada to take a few risks.
Thursday 28 June 2007 TORONTO:CANADA HAS AMONG HIGHEST CORPORATE TAXES
A study by KPMG International of corporate tax rates around the world indicates that Canada has one of the highest rates at 36.1 per cent. That compares with 24.2 per cent in the EU and 27.8 per cent in the 30 nations including Canada of the Organization of Economic Co-operation and Development. However, the study also notes that the EU's indirect taxes are the highest in the world, the Value Added Tax amounting to 19.5 per cent. The federal Goods and Services Tax in Canada comes to only 6 per cent, but all the provinces except Alberta also collect their own.
Menu to mitworld.mit.edu/ on-demand videos of significant public events at MIT. in RealPlayer
Ex Thomas L. Friedman. While you were Seeping The World IS Flat Video length is 1:15:04.
Stephen S. Poloz VP EDC Economics Weekly Commentary Is Canada decoupling from the U.S.? - June 6, 2007
Recent figures show that the U.S. economy did a face-plant in 2007 Q1, while Canada was humming. This has cemented the perception that Canada is decoupling from the U.S.
The matter clearly deserves a closer look. True, the U.S. economy has been experiencing a slowdown, led by a collapse in its housing sector, and posted GDP growth of only 0.6% (at an annualized rate) in 2007Q1. Meanwhile, Canada posted a first-quarter growth rate of 3.7%. Not only is this a very large gap in performance, Canada's growth accelerated from 1.5% in 2006Q4, while the U.S. economy decelerated from 2.5%. This is not just outperformance, but divergence. Past issues | his WN page
Commentary podcast.
Is it really different this time? - June 27, 2007
Financial markets are priced for perfection, with each warning brushed off by investors. Should we be more worried, or is it really different this time?
Commentary podcast.
Andy Nulman 
BBC
; "DTN Chair by Robert J. Galbraith")
; "click for Diana Nicholson OWN")
 "Louise des Trois Maisons")
; "click Jacques Clément OWN")
 "click for Diana T. Nicholson")
; "click for Herb Bercovitz OWN")
Stephen S. Poloz
Wed1320 report 
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Bloomberg
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