Roundup: Morneau’s pabulum problem

Oh, Bill Morneau. After weeks of rough treatment, and the last week most especially, it’s no wonder that he was getting a bit testy when the questions kept coming up yesterday. That he snapped at a journalist just got our backs up because how very dare he, and so on. But it’s hard not to see how this is almost entirely a mess of his own making. Not just the fact that he didn’t divest his shares earlier, which make of that what you will – he was still within the law. I find myself ambivalent to the sanctimonious cries that he needs to appear to be whiter-than-white because that’s a Sisyphean task for which there will never be satisfaction short of being reduced to sackcloth and ashes, especially compounded by the oh-so-Canadian reflex of treating him like a tall poppy who must be brought down to size. The Conservative line that he’s a rich guy who can’t understand the woes of the working guy is certainly suffused with that narrative, but that’s also populism for you.

For me, the bigger problem is that so much of this is about the fact that it all goes back to this government’s particular communications problem of responding to everything with a spoonful of pabulum rather than taking their criticisms head-on. When the Conservatives launched into outright falsehoods about the proposed tax changes, Morneau didn’t fight back – he mouthed the same platitudes and shovelled more pabulum in our faces, and the myths metastasised until he was playing defensive when there was no reason for him to. That the CRA bungled their release of the folio on employee discounts just fed into this same problem, and again, the government couldn’t communicate their way out of a wet paper bag there either, sticking to the pabulum lines of not taxing the middle class rather than actually explaining that no, these are very specific circumstances that won’t actually capture retail workers. And given the current questions around his holdings, there are certainly better ways that he could have communicated decisions that were made (including why a blind trust would not have made sense, for example), or why the various conspiracy theories about how legislation or tax changes he’s proposing are apparently for the benefit of his company are patently absurd (because hey, attacking the messenger is always the sign that you’re on the winning side of the argument). But nope. Pabulum. And you would hope that maybe, just maybe, the government will learn that this is not the way to go about communicating, but I doubt it. They’ll probably hold tight and weather this manufactured outrage for another week or so until something else distracts the opposition, and the outrage cycle will start up again over something else, for which the government’s solution will be yet more pabulum. It’s tiresome from all sides. But this is what politics has devolved into.

Meanwhile, Andrew Coyne castigates Morneau for his poor judgment, while Colby Cosh thinks of him fondly as a great quasi-Albertan for using a numbered company registered in that province, paying taxes there and giving back to the province’s economy.

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Roundup: Unleashing the two-year markers

With it being the two-year mark since the 2015 election, we’re going to start seeing a wave of thinkpieces and columns over the next few days (I suspect there will be a glut of weekend columns of dubious quality on the topic), but Paul Wells got things off to a good start yesterday with his piece on the matter. And he makes some pretty good points about how the complaints that this government hasn’t done anything are off the mark, because I do believe there are a number of things that we forget with our short attention spans, but there are also things that we don’t see obvious signs of, where the government has reformed a lot of the processes by which things get done – and this is a particularly big issue when it comes to trying to move the various Indigenous files forward. While it looks like there has been halting progress, people ignore that many of the problems are capacity-related, so if the government is moving to address those fundamental issues, it leads to better outcomes later than simply throwing money at problems only to make them worse in the long run – which happens all too often.

But Wells also acknowledges the bad, and just like with any government, there’s a lot of that too – the appointments process is a notable example, and Wells points to the bottleneck in the PMO, which goes along with the glut of rookie ministers (unavoidable with so few experienced MPs in caucus), and the problem with messaging. As I wrote about earlier this week, there is a real problem with the way this government shovels pabulum at everyone, but I’m not sure it’s any worse than under the previous government, when you were treated to non sequiturs rather than vague answers that resembled the topics you were asking about. And it’s this inability to have forthright communications that created much of this tax mess as well (but I will also lay some blame on bad and lazy reporting that was too quick to lean on opposition talking points as examples of accountability rather than reaching out to experts and then using that to push back against the tidal wave of misinformation that came out). And most especially the fact that this government was unwilling to actually fight back against the misinformation is why this mess of their own making has been compounded even more so.

“But it’s hard to be entirely saddened by Trudeau’s current discomfort, which if nothing else might shake his team out of the towering sanctimony that characterizes too much of its action and rhetoric,” Wells writes, and I fully agree. In fact, it’s the moments in the past couple of weeks where Trudeau and his ministers have dropped their pabulum-like talking points and been punchier and more authentic in their fighting back against their attackers that I’ve seen a spike in public responses to my own reporting of those instances. Hopefully they’re seeing that too, and it’ll prompt them to take more risks and to stop being so gods damned scripted. But this is also politics in 2017, and we’ve killed off spontaneity or the ability to debate, so I fear that my hopes for honest communications are doomed.

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Roundup: Those amended tax proposals

Bill Morneau unveiled his latest tweaks to his tax change proposals in New Brunswick today, and it looks like a pretty serious attempt to continue to close the avenues for tax avoidance by means of using Canadian-Controlled Private Corporations, while at the same time trying not to completely dissuade the use of those corporations to help businesses save for rainy days or mat leaves, etcetera – in other words, that he’s taken the concerns seriously. So here are economists Lindsay Tedds and Kevin Milligan to break down the new proposals.

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Roundup: Holding companies and crying wolf

The fixation on Bill Morneau and his family wealth is becoming mind-numbing, with new conspiracy theories and allegations of conflicts of interest arriving daily. While the Conservatives made him the subject of their Supply Day motion, demanding he produce all documents he shared with the Ethics Commissioner while continuing to promulgate the absurd conspiracy theory that he was pushing through the private corporation tax changes for the benefit of his company, while the NDP crowed about more alleged “appearances” of conflicts with his tabling a pension reform bill that his family company could, in theory, benefit from. And the subject of whether or not he still controls shares in said family company went through the media cycle like a tornado, with confirmation from the Ethics Commissioner in committee testimony that she didn’t tell Morneau to place his shares into a blind trust – because, as it turns out, he doesn’t control them, having already offloaded them into a holding company that he doesn’t control (apparently his wife does), and none of this is subject to current rules under the Conflict of Interest Act. In response to it all, Morneau sent a letter to the Commissioner requesting a meeting to see if there’s anything else he can do to further comply with the rules that he’s already complying with per her advice.

Two things here – one is that the Commissioner has raised this exception to the Act in the past, and when the Act last came up for review in 2014, she flagged it then and it wasn’t acted upon. Guess who was in power then? The Conservatives, who also pushed through all of those changes to various accountability legislation in 2009, along with the NDP. The second point is that we have constantly been bombarded with constant baseless accusations about the “appearance” of a conflict of interest for everything under the sun. And with these various conspiracy theories being put forward, even Occam’s Razor will tell you that the idea that these changes being put forward, either to pensions or private corporation taxation, for the benefit of Morneau’s company are absurd on the face of it. Pension reforms have long been debated, and there are reams of data about the problems that these private corporations are being used for reasons they were not intended to be by wealthy individuals in order to avoid taxation. Trying to use Morneau as an excuse to make the government back off on either is absurd and shows just how debased our ability to debate is in this country if debate is being replaced by personal attack. Never mind the fact that there has been a whole lot of crying wolf. If everything is a conflict, then nothing is a conflict. Sooner or later a wolf will come, and nobody will care anymore, having been completely numbed by the constant cries beforehand.

(Incidentally, Dawson also called on the government to amend their fundraising bill to include parliamentary secretaries as those who must report, for what it’s worth).

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Roundup: The good news rollouts

The Liberals’ planned rollout of all kinds of “good news” announcements for Small Business Week – reductions in the small business tax rate by 2019, and changes to their planned amendments to Canadian-Controlled Private Corporation (CCPC) rules to crack down on those who use them to avoid paying taxes – were very nearly overshadowed by a Globe and Mail article that cried out that Bill Morneau hadn’t put his shares into a blind trust after all. As it turns out, this was largely a non-story – Morneau followed the advice of the Ethics Commissioner, who felt that because of his particular share structure that he wouldn’t need a blind trust but an ethics screen instead – though there are some added complications around it (see Glen McGregor’s tweets). This after the “revelation” about Morneau’s French villa – not that he had forgotten to disclose it, because he had already – just that he didn’t disclose the particular ownership structure, which is a French corporate structure not uncommon with the ownership of non-commercial real estate, known as a Société Civile Immobilière. Again, a non-story that the opposition (and certain media outlets) pounced upon, trying to make a bigger deal out of them than was merited.

And then there was the Prime Minister’s tax cut announcement at that Stouffville restaurant, and the somewhat bizarre behaviour by Trudeau in the Q&A period after where he tried to answer questions directed at Morneau (no doubt trying to keep control of the message and not let it get railroaded by the non-stories about his villa and shares, but it came off as smarmy). And back in Ottawa, his backbench critics seemed mollified by the morning’s announcements, so we’ll see if that holds in the days ahead. (Not to be outdone by all of the Liberal press shenanigans, Andrew Scheer walked out on a press conference when asked about his former campaign manager’s association with Rebel Media.)

Meanwhile, neither Chantal Hébert nor Andrew Coyne are impressed with the theatrics of this government’s attempt to change the channel on the pummelling they’ve received.

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QP: Discounts and French villas

Hours after the mandatory Monday morning Liberal caucus meeting and the presser by Justin Trudeau, Bill Morneau, and Bardish Chagger on small business tax cuts, QP got underway, with the opposition smelling blood in the water. Andrew Scheer led off, mini-lectern on desk, and read a demand in French for clarity on employee discounts as tax benefits. Diane Lebouthillier stood up to say that the document from CRA did not reflect the government’s position, and they would be reviewed. Scheer asked again in English, making a bigger issue out of this being a tax grab, and a Lebouthillier repeated her response in English — a rarity for her (which she has been working on). When Scheer asked yet again, Lebouthillier reiterated her response for a third time, but back again in French. Alain Rayes took another stab at the very same question in French, got the same answer, and then when Rayes tried to insinuate that she didn’t know what was going on in her department, Lebouthillier stuck to her points. Guy Caron was up next for the NDP, and he raised the non-stories of Bill Morneau’s villa in France, and his company shares not being put into a blind trust (never mind that he followed the Ethics Commissioner’s instructions on the ethics screen instead). François-Philippe Champagne stood up to praise the small business tax cuts instead, and on a second question of the same, Champagne reminded him that he followed the guidance of the Ethics Commissioner. Nathan Cullen was up next, and wondered rhetorically about Liberal promise-keeping as damage control. Champagne praised the small business tax cuts instead, given that there wasn’t really a question there. Cullen raised the villa and the lack of blind trust, and Champagne reiterated that Morneau followed the Commissioner’s guidelines.

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Roundup: No constraints, please

After Kady O’Malley suggested last week that the Senate adopt some kind of formal mechanisms to prevent the Senate from indefinitely delaying private members’ bills so that they die on the Order Paper, Senator Frances Lankin wrote this weekend that as much as she wants to see some of those bills get passed, she has no desire to adopt any mechanisms that would constrain debate in the Senate. And while I’m sympathetic to O’Malley’s point to an extent, I think Lankin has it right – and it’s good that she said something, because a lot of the newer senators look to her for guidance given that she is a senator who came into the job with previous legislative experience. The reasons why those bills can face delays are varied, but sometimes it’s legitimate that they do, and I think it would be a mistake to put in a mechanism that would essentially force those bills to be passed – especially as that would create an incentive for governments to start trying to pass difficult agenda items as PMBs (as the Conservatives tried to do on more than a few occasions when they were in power).

Meanwhile, Conservative MP Todd Doherty took to YouTube to bully senators into passing his private members’ bill. This is one of those kinds of stories that bothers me because nowhere in the piece does it mention who the sponsor of the bill in the Senate is, nor does it try to reach out to them to ask them about state of the bill and what efforts they are taking in order to see it passed, and that’s a detail that matters. If it is indeed waiting to come up for debate in committee, that’s not out of the ordinary considering that usually committees are bound to deal with government legislation before they deal with private members’ bills, and they’re the masters of their own destiny. Never mind that the bill itself is of dubious merit – these kinds of PMBs that demand “national strategies” for everything under the sun, no matter how worthy the cause, tend to be little more than feel-good bills that have little impact other than moral suasion, because they can’t oblige a government to spend money, and they figure that demanding a national strategy will push a government to take action. They don’t, but it’s all about optics, and Doherty is really pushing that optics angle.

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Roundup: The orgy of unforced errors

Word has gone out to Liberal MPs that there will be a mandatory caucus meeting first thing on Monday morning – a rarity given that mostly they wait until Wednesdays (especially as it makes it harder for those MPs who are from remote ridings to get there). The only thing that we know so far is that both Bill Morneau and the PM will be there, and the speculation is that it will outline the changes to their proposed tax changes based on consultations, but one can also assume that this is going to be about the ongoing self-harm that the government has been inflicting on itself over the various tax stories.

And what self-harm it’s been. On Friday, it was revealed that Bill Morneau forgot to declare that he also has interest in a company that owns a villa in France, and you can bet that the Conservatives took to this like a pack of dogs to fresh meat. This after the way that they refused to punch back against the gross distortions being promulgated about the proposed changes to the rules around Canadian-Controlled Private Corporations (CPCCs), or the refusal to provide real clarification around the CRA “folio” on certain employee discounts, preferring in each case to mouth the pabulum about fairness for the middle class. (Cute fact: the CRA “folio” has been up for months, was briefly discussed in the Commons finance committee last month, but only turned into a major crisis after a piece in the Globe and Mail. Because that’s now the Opposition Research Bureau, and it’s where the Conservatives take their daily outrage marching orders from, too lazy or incompetent to do their own research anymore).

And then there’s the added outrage over the fact that the government spent $221,000 on the cover of this year’s federal budget. Oh, how terrible and outrageous, and look at how plain the cover of Paul Martin’s budgets were, and then the Conservative chorus chimes in and makes these snide remarks about comparing the spending priorities between the two governments – completely ignoring the fact that they chose instead to spend even more thousands of dollars staging photo ops off of Parliament Hill to make announcements or give speeches where the Liberals will do it in the House of Commons, where they should be. Lindsay Tedds, mind you, offered up a sort of defence for why the Liberals may have chosen to go with this particular route on a budget design, which those in the throes of a paroxysm of cheap outrage, remain blinkered about.

So I guess we’ll see what emerges from that caucus meeting. Will they emerge with some better means of communicating their plans that won’t just involve more pat phrases about the middle class, and would maybe let them engage in some actual, authentic conversations that will push back against some of the nonsense being thrown around? Or will Trudeau lay down the law on his restless backbench and double down on the talking points that blandly say nothing at all, while they continue to let the Conservatives set the narrative using their own particular brand of spin, misdirection, and distortion? I guess we’ll have to see.

Meanwhile, here’s Colby Cosh raining down hellfire on that $210,000 budget cover, Chantal Hébert on the fire that Bill Morneau is taking, Andrew MacDougall on the Liberal’s inability to communicate their changes, and Paul Wells sees the continued litany of unforced errors as putting the government in danger of alienating the middle class that it so vocally venerates.

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Roundup: No conflict to investigate

For all of the ink spilled and concerns trolled in Question Period, the Morneau-Shepell conspiracy theory is turning into a big fat zero for the Conservatives. Why? It seems that for all of the “appearance of conflict of interest” that they’re trying to drum up and selective laying out of facts in true conspiracy theory style (with the added cowardice of hiding behind the so-called “experts” who laid them out in committee testimony), the Conflict of Interest and Ethics Commissioner herself is shrugging it off.

“There does not appear to be reasonable grounds at this time for the Commissioner to launch an examination under the Conflict of Interest Act or an inquiry under the Conflict of Interest Code for Members of the House of Commons,” said the Commissioner’s spokesperson, and added that they won’t bother investigating investigate “if there is no specific information to suggest that a provision of the Act or the Code may have been contravened.”

And guess who isn’t putting up any specific information that would suggest an actual conflict of interest? The Conservatives. They’re still “gathering information,” which is cute, because why bother filing anything formally when you can make all manner of accusations and cast as much aspersion as possible under the protection of the privilege of the House of Commons, that will be reported uncritically? After all, this is “just politics,” and you can worry about the “appearance” of conflicts all you want on flimsy to no evidence, while facing no consequences whatsoever. It’s tiresome, but it’s the kind of sad drama that we seem to be subsisting on rather than substantive debate on the issues and the actual concerns that appeared around those tax proposals. Such is the sad state of affairs these days.

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Roundup: The demise of Energy East

The news that TransCanada decided to cancel their plans for the Energy East pipeline yesterday created a predictable firestorm of reaction, from the gloating of Montreal mayor Denis Coderre, outgoing Saskatchewan premier getting in his last kicks, to the histrionics of the Conservative caucus. The government’s line is market conditions have changed since the project was first proposed – and they’re entirely correct. But that doesn’t stop the rhetoric, either from TransCanada itself, or from the Conservatives, who are peddling some incredulous, mind-boggling lines to vilify the government.

But seriously, there are plenty of charts and graphs that show how the market conditions have changed beyond just the world price of oil (which is a bit part of it), but that the capacity with the other approved pipelines changes the equation for the hole that Energy East would have filled, and it’s no longer clear that it was a clear-cut decision after all.

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Also, it should be mentioned that as much as TransCanada is blaming government regulation, they did balls this up on their own end more than once, and do need to take some of the blame along the way. But why take that blame when you can shake your fist at the government?

And this having been said, there is a proud Alberta tradition that is underlying all of this. Because some zombies refuse to die.

Meanwhile, Paul Wells looks at the current record of the government in trying to attract investment, and wonders if we really are a place that will get the big things built, or if it will all collapse in tears and recriminations, driving investors away.

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