Highs lows

Who’s left out of Canada’s booming cannabis capitalism?

CANADIAN CENTRE FOR POLICY ALTERNATIVES MARCH/APRIL 2018 $6.95 Contributors

John Akpata is an Ottawa Nick Falvo is Director Kate McInturff is a senior spoken word artist and Peace of Research and Data at researcher with the CCPA Officer with the Marijuana the Calgary Homeless and Director of the Making Party of Canada. Foundation. Women Count project. Vol. 24, No. 6 Bruce Campbell is the former Elaine Hughes is an Keith Reynolds is the ISSN 1198-497X Canada Post Publication 40009942 executive director of the environmental activist former national research Canadian Centre for Policy in several non-profit representative for the The Monitor is published six times Alternatives. In 2015, he was organizations including Canadian Union of Public a year by the Canadian Centre for awarded a Law Foundation the Council of Canadians, Employees and a CCPA-BC Policy Alternatives. of Ontario Fellowship for his where she chairs the Quill research associate. The opinions expressed in the work on the Lac-Mégantic Plains (Wynard) chapter in Erika Shaker is Director of Monitor are those of the authors disaster, and spent 2016 Saskatchewan. and do not necessarily reflect Education and Outreach with at the University of Ottawa the views of the CCPA. Asad Ismi covers the CCPA. law faculty. He is currently international affairs for the Please send feedback to writing a book on this Michelle Weinroth is an [email protected]. Monitor, with a focus on tragedy. author and teacher. Her Western imperialism, and Editor: Stuart Trew published work focuses Benjamin Christensen resistance to it, in the Global Senior Designer: Tim Scarth on 19th and 20th century is a sociology lecturer South. Layout: Susan Purtell propaganda. Editorial Board: Peter Bleyer, at UBC, Douglas College Seth Klein is Director of the Alyssa O’Dell, Seth Klein, Kate and Kwantlen Polytechnic Rita Wong is a poet- CCPA-BC. McInturff, Erika Shaker, Emily Turk University. He completed his scholar and the co-editor, CCPA National Office: doctoral dissertation in 2016, Joel Lexchin, MSc, MD, is with Dorothy Christian, HELP US SHED LIGHT ON THE 500-251 Bank St., Ottawa, examining pension policy Professor Emeritus at the of the creative anthology ON K2P 1X3 reform in Canada over the School of Health Policy and Downstream: Reimagining tel: 613-563-1341 past 50 years. Management, York University, Water (Wilfrid Laurier fax: 613-233-1458 an emergency physician University Press, 2017). ISSUES THAT MATTER TO YOU. [email protected] Roxanne Dubois is a labour with the University Health www.policyalternatives.ca activist, Franco-Ontarian and Network, and a CCPA research occasional writer. Based in (we’ve got some bright ideas) CCPA BC Office: associate. 520-700 West Pender Street Toronto, she spends most Vancouver, BC V6C 1G8 of her time organizing, Anne Lindsey is the former tel: 604-801-5121 educating and activating executive director of the fax: 604-801-5122 young people and precarious Manitoba Eco-Network and [email protected] workers. She scribbles a CCPA-Manitoba research Tax receipts are issued for contributions of $15 or more. CCPA Manitoba Office: stories in different forms associate. MAKE A DONATION Unit 205-765 Main St., Winnipeg, and continues to believe in a MB R2W 3N5 better world. tel: 204-927-3200 I would like to make a monthly contribution of: I would like to make a one-time donation of: fax: 204-927-3201 OR $300 $100 $75 Other ____ [email protected] $25 $15 $10 Other ____

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A complicated marijuana legalization is enriching a new class of white cannabis entrepreneurs while leaving those on whose backs the fledgling “legitimate” industry was built languishing in prison or stuck with criminal records. John Akpata looks at the cops, capitalists and regulatory kinks that are taking the shine off decriminalization—and what the government could do to fix it.18

BEHIND THE NUMBERS As Lac-Mégantic trial lands The B.C. NDP and Site C: Public backs overdue positive verdict, the hard Two perspectives minimum wage hike work begins Seth Klein and Rita Wong 28 Erika Shaker 6 Bruce Campbell 15 A history of pensions and possible future for retirement Getting to know Canada’s COLUMNS National Housing Strategy security in Canada Nick Falvo 7 Alternate Futures: Benjamin Christensen 32 Gambling in home ownership Does China’s One Belt, One Another audit slams P3s— Robin Shaban 13 B.C. take notice Road initiative have a notch Keith Reynolds 9 Below the Fold: The public for Canada? foundations of internet Asad Ismi 36 Should Manitobans dynasties trust nuclear burials? Cynthia Khoo 16 BOOKS Anne Lindsey 11 Work Life: Today’s coders, Michelle Weinroth presents IN THE NEWS tomorrow’s precariat another case for Ilan Pappe 41 Lynne Fernandez The #metoo moment for 40 Freethinker: The Life and Works of Éva Circé-Côté Canadian politics FEATURES Kate McInturff14 Reviewed by Roxanne Dubois 44 Canada’s drug cost crisis can be regulated Joel Lexchin 25

Editorial 2 | Letters 3 | New From the CCPA 4 | Index 17 | Good News Page 38 From the Editor

STUART TREW Doing it for the money

OVERNMENTS COME AND go, the state presidential win, at least in so far as it announced in February, left environ- grinds on—and can grind down was “positive news for the Canadian mental groups scratching their heads: even the most modest ambitions energy sector with regard to a poten- shouldn’t the government’s priority Gfor change in the hearts of incom- tial increase in energy trade.” And be protecting fragile ecosystems, ing MPs and their parties. Whether this Natural Resources Minister Jim Carr like our oceans and coastal regions, is the Trudeau government’s problem said in mid-February he’ll use “all tools and eventually transitioning the is debatable. I mean, how much federal available” to make sure the BC NDP Canadian economy off of fossil fuels? waffling and sidestepping—on things can’t postpone or cancel the Kinder Actually, no. The reforms were about like arms sales, “progressive trade,” and Morgan pipeline expansion, which restoring public trust and “investor especially climate change—is due to the federal government proclaims to confidence” in the consultation pro- inertia within an industry-captured be in the national interest. cess. “And when you have confidence, state and how much simply a product As inconsistent as these plans are you’re not going to get everyone of deeply held beliefs about what gov- with the Trudeau government’s ob- on-side, but people are going to feel ernments do? jective of meeting Canada’s climate heard,” said Minister McKenna on The Liberals agree wholeheartedly, obligations under the Paris Agreement, Global News. for example, with the nonsensical they should not come as a surprise to There’s a reason the world’s cor- oil industry view that the path to anyone. The Liberals have constitently porate class has been riding Prime lowering greenhouse gas emissions in claimed that the main problem with Minister Trudeau’s coattails since Canada runs through new pipelines Canada’s environmental assessment the 2015 election. Optimism is conta- carrying expanded tar sands produc- process is it discourages investment gious. While markets have more than tion to Gulf refineries and West Coast and fails to “get resources to market,” rebounded since 2008-09, and Cana- export terminals. Government memos as Prime Minister Trudeau wrote in his da’s economy witnessed a late-2017 jolt obtained by Greenpeace Canada and 2015 mandate letter to Environment that pushed unemployment down and reported in The Guardian (U.K.) this Minister Catherine McKenna. GDP growth up, we’re hardly out of the winter show the Trudeau government Such views, reflected in reforms to swamp. The federal government ex- was enthusiastic about Trump’s 2016 the major project approvals process pects growth to drop back down again

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If you’d like to learn more, our Development Officer Katie Loftus would be happy to assist you with your gift 2 planning. Katie can be reached at 613-563-1341 ext. 318 or at [email protected]. in a year or two, even after it. But then, predictably, the propaganda about Israel, stimulative spending in the Zionists came running with media outlets—including budget kicks in—including T their usual fictions about the Monitor—are not simply in positive areas like social Israel and the Occupied giving equal space to the housing (see page 7). The glo- Territories. “other side of the argument,” balization favoured by the Much has been written but are promoting damag- financial elite, of unleashed on this subject, but these ing misinformation about animal spirits and unequal are the basic facts: Israel the plight of one of the most accumulation, is in crisis. was established on the oppressed peoples in the Trudeau’s talent is his abil- basis of a methodical world. These “alternative ity to sell this system, and program of land theft and facts” are no less appalling the inequality that drives it, Leers violent ethnic cleansing, and risible than those back to voters as being ulti- and has flouted more Trump and his accomplices mately what’s best for “the UN resolutions than any have been telling the world middle class and those striv- Sounds bad, other nation. Palestinian for over a year now. ing to join it.” It’s a mutual but what is it? Israelis—about 20% of the But Zionist fictions really thing. population—are subjected are “fake news” and ought The government’s mari- I read Robin Shaban’s to more than 50 discrimina- to be treated as such. In a juana legalization plans are review of Cédric Durannd’s tory laws in a system that world teetering on the edge a case in point (see our cover Fictitious Capital (“Dismal can only be called apart- of annihilation, they no story on page 18). If Cana- visions hinder finance heid, and that was named longer deserve to be given da’s licensed producers are reform,” November/ as such by both Nelson a platform. not yet locked in a tight tan- December 2017) in hopes Mandela and Desmond Conrad Alexandrowicz, go dance with Ottawa, the of discovering what it is Tutu. There are now about Victoria, B.C. federal government seems and why it’s a bad thing. It 800,000 settlers living on in a rush to get to the ball. certainly sounds like a bad prime land in the West A new cannabis capitalist thing. However, all I learned Bank, while the Palestinians class is emerging—is being was that Shaban considers there endure a brutal and Corrections carefully created—and con- Durand to be excessively illegal military occupation, solidating quickly; board cautious and pessimistic with home demolitions, the On page 36 of the January/ rooms are filling up with about the chances of destruction of olive groves February issue, the final former establishment types stopping the practice of and water diversion. sentence, which carries from Canadian politics and people earning interest There are thousands of onto page 38, was cut off the police. Meanwhile, the and/or dividends on Palestinians, including chil- at “Global.” It should have public health messaging is imaginary capital. That may dren, currently being held in read: “This is blatantly confused, past marijuana be true, but the review does detention without charge. obvious in cases of Western convictions have not yet not enlighten this reader Meanwhile, the Gaza mining abuses in the Global been pardoned, and a se- about why we should worry Strip—which has been South. But we’ve also seen ries of new rules in bills about fictitious capital. called the largest open-air it happen in Canada, where C-45 and C-46 may end up prison in the world—has a forestry company walked Leon Surette, Ottawa, Ont. recriminalizing the poor, still not recovered from away from the province racialized and young—the Israel’s blistering attacks of Newfoundland and very people whose persecu- of 2008-09 and 2014, in Labrador....” We apologize tion and activism made it Don’t print fake news which banned weapons for the omission. possible to be a pot billion- such as white phosphorous aire today. I am a long-time supporter were used against Whoever is ultimately of the CCPA and depend on civilian targets like schools, Send all feedback, championing profit-making the Monitor for information hospitals and mosques. corrections, poems, praise over the public interest—an that mainstream media may The situation has just been or complaints to monitor@ industry-captured state or not be willing to convey. I made significantly worse by policyalternatives.ca. the elected government— was therefore gratified to President Trump’s decision Canada remains stubbornly see Michelle Weinroth’s to recognize Jerusalem as attached to the idea that you finely written review of Ilan the capital of Israel. can solve most problems by Pappe’s book, Ten Myths I have written many creating more rich people. About Israel (“Handbook for letters on the subject Fewer and fewer people buy a just peace in the Middle of Israel/Palestine, but it, and it’s unlikely they will East,” September/October this is the first in which “feel heard” if it remains the 2017), as well as the subse- I am proposing that in only solution on offer. M quent letters in support of publishing the usual Zionist 3 investor-state claims— let countries opt-out of just a problem in the oil including by Omnitrax, ISDS,” said Sinclair in a patch. This research makes related to its broken rail line statement about his new it clear there are communi- to Churchill, Manitoba, and report. “This could help ties across the country that by Lone Pine Resources, negotiators advance other rely on fossil fuel jobs for which is challenging key Canadian interests, their prosperity.” Quebec’s fracking morato- such as safeguarding Without a proactive rium—that combined seek affordable access to just transition effort, more than $475 million in medicines or securing writes Mertins-Kirkwood, New from damages. Late last year, meaningful continental environmental policies will the CCPA Canada’s chief NAFTA labour standards. Canadian lose popular support and negotiator said “if the U.S. negotiators should not won’t be as economically is going to opt out [of ISDS], let this opportunity slip productive or inclusive as Canada would opt out as through their hands.” they could, and should, The hidden well, and Mexico said they be. The report therefore costs of NAFTA also would opt out.” But at calls for enhancement to the Montreal negotiating Transition that Canada’s social security Against the backdrop of round at the end of January, works and workforce develop- recent NAFTA renegotia- Canadian negotiators said ment programs, and the tions comes the revelation they were pursuing options The transition to a promotion of growth and that the federal government with Mexico to keep cleaner future guarantees equity in the workforce has spent more than $95 Chapter 11 intact bilaterally, neither prosperity nor through strategic invest- million in unrecoverable even in the event the U.S. hardship, argues Hadrian ments in apprenticeships legal fees defending the opts out. Mertins-Kirkwood, CCPA and vocational training for ballooning number of an- As of January 1, Canada researcher, in a new report the zero-carbon economy. ti-democratic investor-state has lost or settled eight assessing Canada’s re- “The fact is, Canada’s social lawsuits filed against NAFTA investor-state sponse to climate change. safety net is not robust Canada under the free claims, which frequently Although this transition enough to support a just trade deal’s controversial target legitimate, non-dis- will create more jobs than transition for those impact- investment chapter. Those criminatory environmental it destroys, he writes, that’s ed. That needs to change,” stunning legal fees, made protection, public health little consolation to the says Mertins-Kirkwood. public for the first time by and resource management 200,000 fossil-fuel workers the CCPA in a report out decisions by Canadian whose livelihoods are put in January, are on top of governments. The federal at risk by environmental Restoring forestry the $219 million Canada government and several policies. These workers, has paid out in awards and environmental organi- and their communities, will Forests are one of settlements resulting from zations are currently in be best served by a national the iconic symbols of NAFTA losses. court challenging Canada’s strategy to ensure the British Columbia, but “The current renegotia- shocking recent NAFTA loss move to a clean economy successive governments tion opens the door to get to Bilcon, a U.S. aggregate leaves no one behind. and companies operating rid of, or at least neutralize, company that convinced an “There’s no doubt we there have largely focused the investor-state ISDS arbitration panel the need to reduce greenhouse on the cheap commodity dispute settlement (ISDS) environmental assessment gas emissions, but in doing lumber business that mechanism in NAFTA and denying it a permit to build so governments must benefits industry. In a new I certainly think Canada a massive quarry in Nova prioritize the stability of report for CCPA-BC, former should grasp the oppor- Scotia violated several communities in vulnerable provincial forestry minister tunity,” said CCPA Senior of NAFTA’s investment regions and the well-being Bob Williams proposes that Researcher Scott Sinclair, protections. Canadian of workers across the regionally based forestry author of the report lawyers are arguing the country,” says Mertins- with co-management by Canada’s Track Record panel had no jurisdiction to Kirkwood, author of local communities and Under NAFTA Chapter 11, hear Bilcon’s complaint. Making Decarbonization First Nations would best in an interview with The Canada could gain Work for Workers: Policies serve B.C.’s public forests Canadian Press. valuable negotiating for a Just Transition to a and the communities that Since 2010, Canada has leverage in the NAFTA Zero-carbon Economy in depend on them. He looks been sued under NAFTA talks, and avoid more Canada. Those commu- to Sweden as a model, Chapter 11 over twice as anti-democratic cases like nities are overwhelmingly where forests are managed many times as Mexico and the Bilcon NAFTA claim, “by found in B.C., Alberta and in the public interest for the U.S. combined and is withdrawing its opposition Saskatchewan, but “the the long term rather than currently facing eight active to the U.S. proposal to threat of job losses is not for the short-term interests 4 of the commodity lumber community control of industry. resources.” “For several generations CCPA-MB’s 2017 in coastal B.C., we State of the Inner City demolished great forests, report revealed that clear-cut countless local community-based valleys and watched giant organizations (CBOs) are corporations come through uncertain whether they and liquidate this great will continue to receive natural asset and then funding from provincial move on,” writes Williams in multi-year agreements Restoring Forestry in B.C. following the government’s “Regionalization would also spending review. “Needless ensure that power rested to say this is a precarious with the communities most situation [for Manitobans strata of the population,” CCPA Senior Economist directly affected by forest who rely on their services],” wrote the Austrian econ- David Macdonald (right) management decisions and writes author Ellen Smirl. omist Ludwig von Mises with Partha Mohanram on not with bureaucrats.” in 1955—a relatively good TVO's The Agenda. year for equality. One has to Pennies added wonder, had Mises lived to The inclusive economy to Nova Scotia see how effectively the neo- minimum wage liberal policies he inspired hundreds of headlines All around us, we see the would crank inequality to across the country and results of the gaps that In late January, the Nova the max, whether he would internationally after reveal- capitalism leaves. So what Scotia government eventually have dialed back ing that Canada’s top-paid would the full picture of an announced the province’s his exuberance about the CEOs made 209 times more economy that is for and by minimum wage would go up natural virtues of the rich. than the average worker in the people look like? Can by 15 cents to $11 an hour. Today even Mises’s most 2016. we create good inclusive With other provinces like devoted practitioners “The interesting relation- jobs while tackling waste Alberta and Ontario moving at places like the Fraser ship with CEOs is that there and poverty in our commu- toward a $15 minimum, Institute get a little hot is not a clear link between nities? That’s the question the lower provincial under the collar talking higher CEO pay and better explored by economists, increase is a “slap in the about the off-the-rails corporate performance,” community economic face to workers,” CCPA-NS wealth gap. Oxfam’s annual report author and CCPA development (CED) prac- Director Christine Saulnier report on inequality, Senior Economist David titioners and employees told Metro Halifax. released in January, shows Macdonald told CTV’s of social enterprises and In a December report on that 82% of the wealth gen- Power Play in January. co-ops in the new filmThe Child and Family Poverty erated globally in 2017 went David discussed his report Inclusive Economy: Stories in Halifax, Saulnier and to the world’s richest 1%, with TVO’s Steve Paikin of Community Economic Katherine Ryan call on the while the 3.7 billion people and Partha Mohanram Development in Manitoba, government to ensure fair who make up the poorest of the Rothman School co-produced by CCPA-MB, income for all work, and half of the world saw no of Management on the the Canadian CED Network for the Halifax Regional increase in their wealth at January 23 edition of The Manitoba, the Manitoba Municipality to become all. To personalize that, it Agenda, which can be Research Alliance and a Living Wage employer takes just four days for a streamed from the TVO Rebel Sky Media. (by setting the wage floor CEO from one of the top website. Community economic at around $19 an hour). five global fashion brands development is prevalent Almost one in five children to earn what a Bangladeshi in Manitoba. In her recent were living in poverty in garment worker will earn in To see more reports, CCPA-MB report on the Halifax in 2015, according a lifetime, the Oxfam report commentary, infographics practice, Sara Wray Enns to the analysis. notes. and videos from the CCPA’s explains that CED “does Here at home, the CCPA’s national and provincial not focus on the creation of annual report on national offices, visit www. profitable businesses alone. Global inequality CEO compensation, policyalternatives.ca. It also seeks to improve continues to reign Climbing Up and Kicking local communities through Down: Executive Pay in stable employment, Income inequality “is pro- Canada (our Monitor improved health, a better gressive in the best sense cover story in the January/ physical environment and of the term and benefits all February issue) made 5 responsibility,” explained another in the Toronto Star. “We’re not changing economics here, we’re just catching up.” And that’s the main point here. The in- crease to the minimum wage shouldn’t Behind be seen as a shock, but rather a long- fought-for correction. Those companies and industry associations arguing the numbers loudest against it might just be the ones WHAT WE’RE BLOGGING ABOUT who’d become a little too comfortable in an outdated business model where profit margins depend on low-wage em- ployees. Like the “rogue” (head office’s term) Tim Hortons franchises that ERIKA SHAKER | ONTARIO decided to dock worker benefits and take away their tips as a buffer against increases to their payrolls. Public backs overdue Now, back to those broader communi- ty benefits from the pay raise. One in four minimum wage hike workers in Ontario earn at or below the minimum wage and 82% of them are 20 or older. A little extra money can help relieve espite business sector fearmon- on low-wage employment. They call stress in low-income households and gering and misreporting by the the minimum wage bump “reckless” or modestly increase their spending power, Dmainstream media, Ontario’s “sudden” or “too much too fast.” What’s which will eventually be felt in business move to raise the minimum wage to truly surprising (reckless even) is that so revenues. Automation—one of the fear $15 an hour has broad public support, many businesses didn’t see it coming, factors in the Ontario debate—has according to a recent survey by Forum even after a two-year $15 minimum wage been progressing independent of wage Research. “[W]hat is surprising,” said campaign in Ontario, a series of global increases, and in the fast-food industry the polling firm, “is that support for precedents and provincial legislation in was introduced to increase orders and the move is spread across all income the works for years. consumer spending, not reduce staff. groups. A lot of people are in favour, Similar minimum wage increases There’s no question the changes busi- even though they themselves aren’t have been studied, debated and imple- nesses will have to make for the $14 and affected” (emphasis added). mented in several U.S. states, in Britain then $15 an hour minimum wage, as well It’s an odd and divisive assertion—that and Australia, and here in Canada in to adjust to new workplace standards, only low-wage workers are positively Alberta. All this strikes me as something will require some adjustment on the impacted by a higher minimum wage— businesses might have considered part of owners. But hey, workers living when we know that society as a whole “market research” or simply “planning in poverty are constantly told to rejig benefits economically and socially from ahead” to minimize any sudden shocks their household expenses—with far a reduction in income inequality. But to their bottom lines. fewer resources at their disposal. let’s set that aside for a moment. Not only that, but the province’s Of course, for those businesses that How often are low-income workers Changing Workplaces Review was have been paying their workers well expected to hear it’s not a higher min- initiated back in February 2015, “to con- all along, and reading the political tea imum wage they need; rather, society sider issues brought about in part by leaves, the change will be much less must create “incentives,” in the words of the growth of precarious employment.” abrupt. Progress is shocking only when Philip Cross at the Macdonald-Laurier Ontario businesses had seven months’ you resist or postpone it. Institute, to “pursue actions that will notice of the bump to $14 an hour on Rather than retreating to last-minute lift them out of low income, such as January 1—part of legislation, the Fair obstructionism, businesses would do working hard, demonstrating initiative Workplaces, Better Jobs Act, aimed at better to simply prepare now for next and enterprise, and obtaining a good improving the working lives of contract January’s additional $1 raise to $15 an education”? In this view of the world, and part-time workers—and they have hour, which is what polls suggest the it’s all about doing one’s homework, another year before $15 an hour kicks in. public want them to be doing. In the making sacrifices and planning ahead, To be fair, some businesses did pre- spirit of financial planning, good asset as we can read in any number of articles pare. “You make choices. I don’t have management and projected returns on on financial literacy. a Sea-Doo. I’d rather give my cooks a investment—if not economic justice— Consider how the increase is framed raise,” one Ottawa-based restaurant let’s get to work. M in so much of the media coverage, and owner told the Ottawa Citizen. The ERIKA SHAKER IS DIRECTOR OF EDUCATION AND by business associations like Restau- “recovery shouldn’t be on the backs OUTREACH WITH THE CCPA. FOLLOW HER ON TWITTER @ERIKASHAKER. rants Canada that have come to depend of workers. It should be a shared 6 NICK FALVO | NATIONAL to repairs while the other half is for new builds. This large fund will both assist with social housing and housing that’s Getting to know owned and operated by for-profit land- lords, and consist of several programs Canada’s National (including grants and loans) that target different groups. The federal govern- Housing Strategy ment anticipates 6,000 new housing units annually will be created in addition to repairs. At least 7,000 shelter spaces will be created or repaired for survivors of family violence. There will also be he Trudeau government unveiled benefit program will interact with the 12,000 new units created for seniors, its anticipated National Housing rest of Canada’s income assistance and at least 2,400 new units for persons TStrategy in November. While framework. For example, will a social with developmental disabilities. Though much of its content and funding levels assistance recipient who receives this it is a unilateral federal program, some had already been broadly outlined in the new benefit be allowed to keep the assistance from provincial and terri- 2017 federal budget, the strategy told full value of both financial supports? torial governments may be required. us at least 10 things about the govern- What about a household that’s already In general, among other things, we ment’s plans to renew the federal role receiving a provincially administered can say this is a demonstration of in affordable housing in Canada. rent supplement? And what will this the Trudeau government’s interest in look like on reserves? getting back into the direct delivery of 1. housing programs. Quebec has already The strategy aims to reduce chronic 3. said that it does not want direct federal homelessness by 50% over 10 years. A new National Housing Co-investment involvement in the housing sector and The federal government describes the Fund will create up to 60,000 units of expects to negotiate an arrangement “chronically homeless” as those people, new housing and repair up to 240,000 whereby the province will remain solely “often with disabling conditions (e.g., units of existing housing. Over 10 years, responsible. chronic physical or mental illness, this federally managed initiative will substance abuse problems), who are be worth $15.9 billion (including $4.7 4. currently homeless and have been billion in capital grants and $11.2 billion The Canada Community Housing Initi- homeless for six months or more in the in low-interest loans from the Canada ative will focus on preserving existing past year (i.e., have spent more than 180 Mortgage and Housing Corporation). units of social housing at a cost of $4.3 cumulative nights in a shelter or place About half of the grant funding will go billion over a decade, with a cost-match- not fit for human habitation).” Setting ing requirement from provinces and targets is positive, but in the absence territories. Note that this is precisely of a clearly defined implementation the amount of federal funding set to framework it’s very challenging for expire over the next decade on existing researchers to accurately assess how social housing units, i.e., this is about ex- realistic this target is vis-à-vis various piring operating agreements. Canada’s spending commitments. approximately 500,000 social housing units that are both administered by ei- 2. ther provincial or territorial authorities A key feature of the strategy is the and have rent-geared-to-income (RGI) creation of a Canada Housing Benefit subsidies are eligible for this money. developed in partnership with the prov- This fund will assist with repairs, help inces and territories to help low-income keep rents affordable and provide households afford rent in both private mortgage assistance for operators. This and social housing units. The Trudeau The Trudeau means the issue of expiring operating government estimates this will cost government agreements is fixed for the next 10 $400 million over seven years beginning years—provided the provinces and in 2020, and that the average beneficiary appears to want territories agree to match costs. (The will receive $2,500 in support per year. to shift traditional Federal Community Housing Initiative It is expected that half of this money will do essentially the same thing for will come from the federal government social housing social housing units that are federally and the other half from provinces and models toward administered, including co-op units. territories. Certain subgroups will be This will entail $500 million in federal prioritized, though it’s not yet clear mixed-income funding over 10 years. No cost-matching which, nor do we know how this new developments. will be required here.) 7 5. A key feature of 10. The Trudeau government appears There will be lots to monitor over the to want to shift traditional social the strategy is next several years, and there are many housing models toward mixed-income the creation of a unresolved questions. For example, developments. Developments that beginning in 2020, there will be reports are 100% RGI will be discouraged, and Canada Housing to Parliament every three years on the government will encourage the Benefit to help housing targets and outcomes. But who redevelopment of existing projects will do that reporting? Who will set the that meet that definition. This will be low-income metrics for the reporting and who will done through the National Housing households afford calculate the figures? Also, the federal Co-investment Fund and Canada government says it’s working with First Community Housing Initiative, both of rent in both Nations, Métis and Inuit organizations which are discussed above. private and social to develop separate housing plans, but what will they look like and will they 6. housing units. involve new funding? The strategy An assortment of additional new vows to take a “rights-based approach initiatives were announced, such as to housing” requiring new legislation, the creation of a new Federal Housing but it’s not clear what such an approach Advocate and National Housing Coun- actually means. Finally, what happens cil, the latter an advisory body that will if some provinces or territories refuse provide ongoing input to the Canada to match the costs of some of the Mortgage and Housing Corporation initiatives? (CMHC) beginning in 2018. A new Com- munity-Based Tenant Initiative will also for Housing Solutions,” which many In sum, the new strategy is arguably be created (to foster participation by housing policy experts considered to the most positive development in feder- people with lived experience) alongside be a type of strategy. This had a trans- al housing policy since the early 1970s, a new public engagement campaign formative impact on affordable housing signalling that the Trudeau government with an anti-stigma focus. policy in Canada, specifically by getting is serious about the issue. But while the the provinces and territories more government’s intent is clear, we’ll be 7. engaged. Also, while the new strategy watching this year’s budget and other A new National Housing Strategy contains some language pertaining developments to see how well they can Research Agenda worth $241 million to home ownership, it is very heavily actually deliver. M over 10 years is set to embrace open focused on the rental sector. NICK FALVO IS DIRECTOR OF RESEARCH AND DATA data. Some of this funding will go to AT THE CALGARY HOMELESS FOUNDATION. FOLLOW HIM ON TWITTER @NICHOLAS_FALVO. Statistics Canada, some to CMHC. The 9. Trudeau government says it wants to The strategy may overstate a few other increase funding for housing research points as well. For example, it vows to “both inside and outside government create four times as many housing units and enhance the channels available to annually as were created from 2005 communicate research results.” Also, to 2015. However, according to Greg according to the strategy, “Solution Suttor’s new book,Still Renovating: A Labs will be funded to bring experts History of Canadian Social Housing Pol- and a range of housing stakeholders icy (McGill-Queen’s University Press), together to rapidly incubate and approximately 7,900 affordable rental scale potential solutions to housing housing units (not counting on-reserve affordability pressures. Through open housing) were created annually during competitive processes, teams from the 2005–2013 period. Since the strat- the housing sector will be invited to egy claims it will create 100,000 new identify housing challenges in key Na- units over 10 years, it would be more tional Housing Strategy priority areas accurate to say that it will result in a and propose strategies to develop new, modest increase in new builds (it’s world-leading solutions.” quite unlikely they will even double in number). Furthermore, CMHC has 8. not published good data on numbers We’re told this is “Canada’s first ever of new units created annually over the National Housing Strategy,” but that past several decades, so this makes may not be accurate. In the mid-1980s, it challenging for researchers to fact- the federal government released a check any such claim with any level of document titled “A National Direction precision. 8 whether a P3 is the best model for any particular infrastructure project, decision-makers in the U.K. have tipped the scale in favour of P3s. The same complaint has been raised in B.C., including in a review of Partnerships BC conducted by the Ministry of Finance. One of the chief arguments in favour of P3s is that they transfer the risk of cost overruns on the project to the pri- vate sector. But the NAO found “there is little evidence that overall construction cost is lower.” P3 proponents have also argued that with private companies op- erating the projects the government will earn tax revenue from them. However, the NAO report found that government had overestimated the amount of taxes it would earn from P3 companies. Here in B.C., the government also cites taxes from P3 companies as an advantage for the program, but there is little indication they have actually KEITH REYNOLDS | BRITISH COLUMBIA studied this issue. For example, the B.C. government had no information on what the implications were on tax As U.K. audit slams P3s, returns from P3s when the parent company moved their operations. The B.C. projects continue provincial auditor found “[t]here is still a lack of data available on the benefits of private finance procurement.” he public-private partnership auditors general, issued an assessment Even if benefits have been harnessed (P3) model for delivering public of government P3s over the past several under P3s, the U.K. audit report found Tinfrastructure and services is decades. According to that report, the “these can also be achieved without the an expensive mess, confirmed again U.K.’s 2010 national infrastructure plan use of a long-term private finance con- by new international evidence and a estimated the indicative cost of capital tract.” In other words, public projects high-profile bankruptcy in the United for PFIs to be 2% to 3.75% above the funded by government borrowing could Kingdom. Will the B.C. government ever cost of government borrowing. achieve the same benefit. get the message? Higher interest rates produce higher For example, the NAO states that the Since 2002, the provincial gov- project costs. The NAO report found use of fixed-price contracts for publicly ernment has relied heavily on P3s to that “paying off a debt of £100 million financed projects, in which the price is build public hospitals, roads, bridges, over 30 years with interest of 2% costs set up-front and is therefore ultimately environmental projects and even the £34 million in interest; at 4% this more independent of costs, “can be effective new Emily Carr University campus than doubles to £73 million.” In other in reducing cost overruns.” In another (pictured). Under these arrangements, words, over a 30-year period (the stand- approach, “[t]he risk of construction corporations provide some or all of the ard life of a P3 contract), the higher cost cost overruns could also be transferred funding for public capital projects, and of borrowing nearly doubled the cost of using a shorter private finance contract often also service the projects for dec- paying off debt. that only covers the construction period ades. In return they get a guaranteed In 2009, two of B.C.’s most prominent but this option has never been pursued cash flow for the life of the P3 contract. forensic auditors came to exactly the in the U.K. under PFI contracts.” B.C. borrowed the P3 model from same conclusion as the NAO: govern- Economist Marvin Shaffer has raised the United Kingdom where it was pio- ment consistently raises capital at a exactly this point in the B.C. context. In neered under the term “private finance cheaper rate than P3 providers. B.C.’s fact, the latter option was pursued in initiative” or PFI. Whatever you call it, auditor general also flagged this issue in B.C. for the building of the Evergreen the private-sector-led infrastructure a 2014 report, noting that the cost of P3 Line transit route, as compared to the strategy has developed a bit of a stink borrowing was twice as high as normal full-fledged P3 model under which the for how wasteful it can be. government borrowing. Canada Line was built. In January, the U.K.’s National Audit Moreover, the NAO report found There were also questions in the Office (NAO), the equivalent of Canada’s that instead of objectively assessing U.K. about the costs of having private 9 CARILLION CANADIAN P3 PROJECTS

Capital Cost Substantial Completion/ Project Sector ($CAD) Delivery Model Carillion’s Role Financial Close Years of Concession Location

Stanton Territorial Hospital Renewal Health $300m Design-Build- Developer, Equity Investor, Financier, 2015 2018/ Yellowknife, NWT Finance-Maintain Facilities Management, Lifecycle 30 Years Renewal

Saskatchewan Hospital North Battleford Health $300m Design-Build- Developer, Equity Investor, Financier, 2015 2018/ North Battleford, Finance-Maintain Design-Builder, Facilities Management, 30 Years SK Lifecycle Renewal

Oakville Trafalgar Memorial Hospital Health $1.1b Design-Build- Developer, Equity Investor, Financier, 2011 2015/ Oakville, ON Finance-Maintain Design-Builder, Facilities Management, 34 Years Lifecycle Renewal

Forensic Services and Coroner’s Complex Justice, Secure $300m Design-Build- Developer, Equity Investor, Financier, 2010 2013 Toronto, ON Finance-Maintain Design-Builder, Facilities Management, 30 Years Lifecycle Renewal

Centre for Addiction and Mental Health Health $200m Design-Build- Developer, Equity Investor, Financier, 2009 2012/ Toronto, ON Finance-Maintain Design-Builder, Facilities Management, 30 Years Lifecycle Renewal

Royal Victoria Regional Health Centre Health $260m Build-Finance Developer, Financier, Design-Builder 2009 2013/ Barrie, ON 25 Years

Sault Area Hospital Health $276m Design-Build- Developer, Equity Investor, Financier, 2007 2010/ Toronto, ON Finance-Maintain Design-Builder, Facilities Management, 30 Years Lifecycle Renewal

Sunnybrook Health Sciences Centre Health $142m Build-Finance Developer, Financier, Design-Builder 2007 2010/ Toronto, ON M-Wing Expansion n.a.

Royal Ottawa Mental Health Centre Health $130m Design-Build- Developer, Equity Investor, Financier, 2004 2007/ Ottawa, ON Finance-Maintain Design-Builder, Facilities Management, 20 Years Lifecycle Renewal

Brampton Civic Hospital Health $510m Design-Build- Developer, Equity Investor, Financier, 2003 2007/ Brampton, ON Finance-Maintain Design-Builder, Facilities Management, 25 years Lifecycle Renewal

SOURCE: “THE COLLAPSE OF P3 GIANT CARILLION AND ITS IMPLICATIONS,” JOHN LOXLEY, CCPA-MB.

corporations act as ongoing service the overexpansion of P3 projects. The in Saskatchewan and the Northwest providers in public facilities. The NAO UK government has had to take over Territories. Seven of these are hospitals found “recent data from the NHS Lon- Carillion’s responsibilities and is now, and two are mental health centres.” don Procurement Partnership shows as John Loxley points out in a new B.C. barely escaped getting caught that the cost of services, like cleaning, CCPA-Manitoba report on the matter, up in this Carillion mess. The company in London hospitals is higher under PFI scrambling to feed school children, care bid, as part of consortiums, on several contracts.” for hospital patients, make sure that provincial P3 projects but, as luck would That may be rather understating prisons remain staffed and that roads have it, did not win any of them. (Caril- the point. While the audit office took are maintained. lion was granted creditor protection by an intensive look backward, there is a “Carillion obtained about 11% of its an Ontario court at the end of January more recent development they did not total annual revenue or £596 million and claims its Canadian operations are examine. (over $1 billion) from Canadian oper- safe for the time being.) Carillion, one of the UK’s largest ations…and employs 6,000 Canadian Ontario’s auditor general also raised providers of P3 services, fell apart in workers,” writes Loxley. “It is heavily questions about P3s in her 2016 and 2017 early 2018 and went into receivership involved in 10 P3s in Canada [see chart] annual reports. “There is no empirical after failing to meet huge debt com- with total capital assets of $3.25 data supporting the key assumptions mitments accumulated as a result of billion, eight in Ontario and one each used by Infrastructure Ontario to assign 10 CARILLION CANADIAN P3 PROJECTS

Capital Cost Substantial Completion/ Project Sector ($CAD) Delivery Model Carillion’s Role Financial Close Years of Concession Location

Stanton Territorial Hospital Renewal Health $300m Design-Build- Developer, Equity Investor, Financier, 2015 2018/ Yellowknife, NWT Finance-Maintain Facilities Management, Lifecycle 30 Years Renewal

Saskatchewan Hospital North Battleford Health $300m Design-Build- Developer, Equity Investor, Financier, 2015 2018/ North Battleford, Finance-Maintain Design-Builder, Facilities Management, 30 Years SK Lifecycle Renewal

Oakville Trafalgar Memorial Hospital Health $1.1b Design-Build- Developer, Equity Investor, Financier, 2011 2015/ Oakville, ON Finance-Maintain Design-Builder, Facilities Management, 34 Years Lifecycle Renewal

Forensic Services and Coroner’s Complex Justice, Secure $300m Design-Build- Developer, Equity Investor, Financier, 2010 2013 Toronto, ON Finance-Maintain Design-Builder, Facilities Management, 30 Years Lifecycle Renewal

Centre for Addiction and Mental Health Health $200m Design-Build- Developer, Equity Investor, Financier, 2009 2012/ Toronto, ON Finance-Maintain Design-Builder, Facilities Management, 30 Years Lifecycle Renewal

Royal Victoria Regional Health Centre Health $260m Build-Finance Developer, Financier, Design-Builder 2009 2013/ Barrie, ON 25 Years

Sault Area Hospital Health $276m Design-Build- Developer, Equity Investor, Financier, 2007 2010/ Toronto, ON Finance-Maintain Design-Builder, Facilities Management, 30 Years Lifecycle Renewal

Sunnybrook Health Sciences Centre Health $142m Build-Finance Developer, Financier, Design-Builder 2007 2010/ Toronto, ON M-Wing Expansion n.a.

Royal Ottawa Mental Health Centre Health $130m Design-Build- Developer, Equity Investor, Financier, 2004 2007/ Ottawa, ON Finance-Maintain Design-Builder, Facilities Management, 20 Years Lifecycle Renewal

Brampton Civic Hospital Health $510m Design-Build- Developer, Equity Investor, Financier, 2003 2007/ Brampton, ON Finance-Maintain Design-Builder, Facilities Management, 25 years Lifecycle Renewal

SOURCE: “THE COLLAPSE OF P3 GIANT CARILLION AND ITS IMPLICATIONS,” JOHN LOXLEY, CCPA-MB.

costs to specific risks,” she said in the private-sector companies and not construction due to start this year, is first. And, like the U.K.’s NAO, she found the hospitals.” also going down the design-build-fi- that with good contract management The U.K. government has managed to nance-maintain P3 procurement road. practices public sector projects could claw back profits from some P3s while It is long past time for both the B.C. reap the theoretical benefits of P3s other P3 contracts have been cancelled government and our auditor general to while also benefiting from the savings or bought out. The official opposition give these projects the kind of critical of lower public financing costs. Labour Party has proposed bringing P3s attention we are seeing in the U.K. and In 2017, the Ontario auditor general to an end altogether. Ontario. Ideally, we’ll see action before found that while there are mecha- Despite the mounting evidence we waste more time and money on new nisms in place for solving disputes against them, several P3 projects are P3 projects—and before a Carillion-lev- between hospitals and their P3 moving ahead in B.C. The government el crisis forces us to pay attention. M partners, these were ineffective and announced in October the “preferred KEITH REYNOLDS IS THE FORMER NATIONAL involved potential conflicts of interest. proponent” for an Interior hospital “will RESEARCH REPRESENTATIVE FOR THE CANADIAN UNION OF PUBLIC EMPLOYEES AND A CCPA-BC She said “hospitals informed us that be responsible for designing, building, RESEARCH ASSOCIATE. THIS ARTICLE CONTAINS the independent certifiers assigned partially financing, and maintaining UPDATES AND ADDITIONS BY THE MONITOR. FOLLOW KEITH ON TWITTER @KREYNOLDS118. may not always be impartial because the new tower.” The Royal Columbian their ongoing work comes from the Hospital Redevelopment Project, with 11 ANNE LINDSEY | MANITOBA reluctant to extend their amendments to the nuclear situation. Instead, we are encouraged by Min- Should Manitobans trust ister of Natural Resources Jim Carr (ironically, the senior minister from nuclear burial plans? Manitoba) to trust the regulator and join him in believing that CNSC would never make a decision that would risk here was a time when a plan to nuclear waste that the WR-1 reactor the health and safety of Canadians. bury highly radioactive materials now constitutes. But that has changed, This is despite the fact that in-situ T500 metres from a river that too. decommissioning is not the interna- provides drinking water and flows into The new proponent is Canadian tional best practice and has never been Lake Winnipeg would have attracted a Nuclear Labs (CNL), a consortium of used in Canada, and that CNL’s current fair bit of attention in Manitoba. Maybe multinationals, including SNC Lavalin, environmental assessment is beset even a mild uproar. One imagines the Mitsubishi, Fluor Corp, Rolls Royce with significant problems, including not provincial government at least would and CH2M HILL, to whom the federal proving that ISD is the safest option for have had something to say about it. government has given the responsibility people and the environment, and failing So how is it that this scenario seems for “reducing Canada’s nuclear waste to account properly for the concerns of destined to unfold—soon—and there liabilities,” with a reward of billions of Indigenous Canadians. is scarcely a murmur to be heard in the taxpayers’ dollars. Some things don’t change, such as public sphere? What has changed? A quick Google search on consortium successive Canadian governments’ A few things, as it turns out. members turns up multiple interna- cheerleading for the nuclear industry, First, when the WR-1 research reactor tional scandals and charges, some and, perhaps worse, the continued was built in Pinawa (about 100 km east of which involve breaches of nuclear absence of a coherent policy to deal of Winnipeg) in 1963, the agreement safety. None of the now-retired nuclear with the stockpile of spent fuel, con- between the federal government scientists who live in Pinawa, and who taminated reactor components and (responsible for most nuclear matters) know the reactor and the site well, were uranium mine tailings accumulating and Manitoba was that at the end of the consulted by CNL for the new plan and across the country. reactor’s life the site would be restored are, incidentally, highly critical of it. Instead we are being asked to trust to “green field” (i.e., natural) conditions. Third, the regulatory environment ad hoc and unproven schemes to ren- The original licence to “decommis- is different. The Harper government’s der our nuclear liabilities temporarily sion” the reactor planned exactly that: changes to environmental assessment invisible. the spent fuel having already been legislation placed responsibility for And that’s a real problem. Because moved, the reactor would be completely the safety and soundness of nuclear something else that hasn’t changed is dismantled and its remaining radioac- plans in the hands of the regulator, the the profound danger these materials tive inventory, consisting mostly of Canadian Nuclear Safety Commission, pose to human health and ecosystems contaminated reactor parts, taken off sometimes referred to as a “captured when, not if, they become mobile in site to await “disposal” in whatever regulator” due to its cozy relationship the environment. Manitobans should Canada’s final nuclear waste solution with nuclear proponents. CNSC has not be guinea pigs for this particularly was going to be. Notwithstanding the never denied a nuclear reactor licence inappropriate and precedent setting residual contamination remaining from and demonstrably does not understand proposal. M the multiple accidents and leaks this the planning necessary for sound ANNE LINDSEY IS THE FORMER EXECUTIVE DIRECTOR reactor experienced, the “green field” environmental assessment. Moreover, OF THE MANITOBA ECO-NETWORK AND A CCPA- MANITOBA RESEARCH ASSOCIATE. A VERSION OF promise would be honoured. its decisions may not be overturned by THIS ARTICLE WAS PUBLISHED IN THE WINNIPEG Now, however, Canada wants out government. FREE PRESS ON JANUARY 23, 2018. of the original agreement and instead It’s hardly comforting to know that prefers in-situ decommissioning (ISD), in nuclear matters Canada is now a proposal that leaves all the non- reputed to have a “benign regulatory spent-fuel radioactive inventory, some environment,” according to the World of which will remain deadly for tens of Nuclear News. In other words, bring thousands of years, grouted in place in your nuclear business here, we won’t a shallow grave next to the Winnipeg be watching you very carefully! River. This new project is subject to Fourth, governments have also another environmental assessment changed. Here in Manitoba, the Con- and licensing process. servatives seem blissfully unconcerned Second, the original proponent of the about the new plans for Pinawa. In reactor decommissioning was Atomic Ottawa, the Liberals have proposed re- Energy of Canada, Ltd. (AECL), a federal forms to the environmental assessment Crown corporation and “owner” of the process for major projects but seem 12 interest. These generations were able to build themselves ALTERNATE a sizable amount of equity with relative ease. So, the idea of housing as a stable investment with a FUTURES guaranteed return is based on the experience of older generations of Canadians who lived through an anomalous ROBIN SHABAN increase in house prices. That being said, there is some logic to the claim that housing values always appreciate. One could argue, for example, that housing prices will The biggest bet continue to increase because the Canadian population is growing and there is a fixed supply of land. With constant of your life supply and increasing demand, the only place for prices to go is up. The same people may argue that current home- buyers have it even better than earlier generations because HERE IS AMPLE and often trivial public debate over the interest rates are so low. defining quality of the millennial generation: tech-lov- In reality, despite demographic growth and relatively ing, narcissistic, obsessed with avocado toast, and so on. cheap mortgages, the choice to buy a house as an invest- TOften grossly overlooked is the cohort’s low financial ment will expose you to more financial risk, not less. resilience. As with any investment, we cannot know with true Millennials stand at the intersection of several unfortu- certainty what housing prices will do in the future. More nate trends, including stagnating wages, rising tuition costs cautious types will point out that if the enigmatic Bank (and student debt), more precarious work, and lastly, rising of Canada chooses to continue increasing interest rates house prices. Now they are approaching their thirties, it could price new buyers out of a mortgage and make which is generally the age when people transition from paying current mortgages more difficult, resulting in lower renting to home ownership, as every generation in Canada demand for housing and lower prices. born after 1920 has done. At the end of the day, when you buy a house for the Home ownership is not just about having a house. It purposes of ensuring your financial future, you are making is important if you want to have children, as there are a very big bet, typically worth hundreds of thousands of generally few homes for rent that are big enough for a dollars. So, if you are thinking of buying a house, consider family. Even more broadly, the intense commodification of housing means that home ownership becomes a “making it” benchmark by which we assign status. A common line of reasoning states that, on top of the fa- One solution is to increase milial benefits, home ownership can be a solution to financial the supply of social and instability and not the cause of it. While it may be difficult, if not impossible, to save enough for a down payment, once co-operative housing. you buy a home you begin to build equity in a low-risk, modest-return asset. And once you retire, so the story goes, you have the option to sell your home and cash in that equity. your expectations. Are you buying hoping to grow some In short, home ownership is a financial oasis, if one with equity to fund your retirement? Or are you simply looking a very high entry fee. The crux of this argument, commonly for a comfortable place to live and willing to lose money, espoused by baby boomers, is the refrain that house prices or at least come out even? (more precisely, land prices) always go up. The problem is, Fundamentally, to address the millennial financial crunch they don’t, or at least they don’t always go up enough for with respect to housing, we have to attack the root of the this argument to make sense. (I want to acknowledge a problem: extreme commodification. One potential solution friend of mine, who wishes to remain anonymous, for a is to increase the supply of social and co-operative housing. very helpful conversation that led to this column.) More supply—and a better mix of rental options for fami- A recent paper in the American Economic Review, titled lies—brings prices down, which ultimately benefits everyone. “No Price Like Home: Global House Prices, 1870–2012,” shows Another option is to eliminate the capital gains exemp- that housing prices have only significantly trended upward tion on primary residences. This tax credit, which allows in the last 40 years. Go back to the 1870s, however, and the you to exempt the gains from selling your primary resi- graph looks more like a hockey stick, with prices relatively dence on your taxes, likely increases demand for housing, stable up until the Second World War then increasing making homes less affordable in the long run and thus sharply. Since the late 1980s, housing prices have increased harming the very people it is meant to benefit. at a rate faster than we have ever seen in 150 years. By turning to non-market solutions, and cutting tax It was during the eighties that many boomers bought credits that are shown to primarily benefit higher-income their first homes. Interest rates were so high that having families, people of all generations, social strata and income a mortgage was like buying a house on a credit card. Still, levels can access a dignified place to call home. M many home buyers eventually came out ahead from ROBIN SHABAN IS AN ECONOMIST BASED IN OTTAWA. YOU CAN REACH HER AT property values outpacing at least part of the cost of high [email protected]. 13 In the news

KATE MCINTURFF What #metoo is bringing to Canadian politics

t’s hard to believe that only two months I write this as someone who can of political parties of all stripes that ago the most exciting thing in Ontario remember being called “babe,” “sweet- they condemn sexual harassment or Ipolitics was the possibility that the heart” and, my special favorite, “honey.” sexual assault absolutely. Just a few Progressive Conservatives might upset I remember the period during which years ago these allegations were not the sitting Liberal government in the someone other than me objected to always enough to ruffle caucus feathers upcoming election. Recent weeks have the use of these rather un-charming (looking at you, Rick Dykstra, Patrick given us something else to talk about. endearments, and I have met the Brazeau). Yes, I think the rapid expulsion On January 24, the leader of the PC generation who thinks the possibility of federal and provincial legislators in Party, Patrick Brown, held a press con- of using such words in the workplace recent days is a political calculation. But ference in which he denied allegations is laughable. I’m fine with that. that he had engaged in sexually preda- Therein lies my hope for #metoo. A Recent research on perpetrators tory behavior. By the next day, CTV had hope for a world in which two (male) of sexual assault teaches two things. aired a story outlining those allegations, MPs cannot refer to a third (female) First, that many are serial predators: his senior staff had quit and Brown had MP as “your dog” (looking at you, Peter the more often they “get away” with stepped down as leader of the party. MacKay). A hope for a world in which a sexual assault, the more likely they are With a leadership race in frantic young woman with political ambitions to do it again. And second, across all swing as the Monitor went to print, and does not have to accept a hand on her perpetrators of violent crime, they are an election only months away, the party ass as the price of admission to the the least likely to demonstrate remorse. and pundits are trying to decide which political sphere. #Metoo is already So, am I going to put my energy into way the political wind is blowing. Will changing the world of politics; allega- making sure the political figures and the leadership contest foretell a shift to tions of sexual assault are putting an the party machinery that protected the socially conservative right? Will the end to political careers. them are truly, deeply, sincerely sorry? PCs lean to the centre? Will the party At my most cynical, I have little faith Not so much. be able to bind the new leader to the in the sincerity of the protestations Here’s the hope. For the time being, existing platform? for as long as this #metoo moment lasts, A shift to the right or the middle we are going to see real consequences isn’t the only change in the offing. for sexual harassment and assault. We Some of Brown’s colleagues, and the are going to see more women elected reporters who cover Queen’s Park, to political office. We are going to see have commented that the allegations a space for women with political ambi- against him didn’t come as any sur- tions to operate with less likelihood that prise. Others have written about the they are going to encounter unwanted “rumour network” that warns young sexual attention or even violence. In the women entering the political sphere long term, this is going to mean more about which men might treat them as In the long term, women in office, more women with the potential sexual conquests rather than this is going experience to run for office, and fewer political staff. sexual predators in positions of power. It is also worth noting that Canada’s to mean more Now, I’m not going to say that women libel laws are more stringent than women in office, are incapable of bad behavior. But let those of the United States. So the fact me remind you that 98% of those that stories of sexual harassment and more women with charged by police with sexual assault assault are making it into the news is the experience are male. Simply as a matter of statisti- notable. The fact that there are seri- cal probability, having more equitable ous consequences for those accused to run for office, representation of women and men in of sexual harassment and assault is and fewer sexual office will lower the odds of predatory more than notable, it has the potential sexual behavior in the political arena. to fundamentally reshape the political predators in Already there are signs of structural landscape. positions of power. changes—changes that will force a 14 shift in behavior. In 2014, the federal BRUCE CAMPBELL Liberal Party expelled two MPs from caucus following allegations of sexual assault. This also led parliamentarians As the Lac-Mégantic criminal to realize that they didn’t actually have any procedure in place to deal with trial ends, government allegations of sexual harassment and assault at their workplace. Now they action must begin have one: the federal government has recently tabled legislation that would further protect political staff from n January, a jury rendered a not guilty An independent judicial inquiry is sexual harassment. verdict in the criminal negligence trial essential to uncovering the whole truth: The #metoo movement signals a Iof the three railway workers involved what happened, why it happened and deeper change for all political parties. in the Lac-Mégantic tragedy in 2013. who is responsible, including at the It introduces them to a new constit- Forty-seven people were killed and highest policy levels. The institutional uency—one that doesn’t fit neatly the town centre was destroyed after an and policy breakdown must be brought into a partisan box. That constituency unattended 74-car freight train carrying to light, and changes made to prevent includes the 553,000 women who have Bakken crude oil rolled downhill into the a recurrence. been sexually assaulted in the past five Quebec town and derailed. Despite some improvements, years in Canada (according to Statistics The trial result was a just decision Transport Canada remains captive to Canada’s General Social Survey on Vic- given that these men, the last links in industry and lacking the resources timization). That constituency includes the accountability chain, were facing so to provide comprehensive rail safety more than 50% of working women, who, many factors beyond their control, all oversight. The railways still set the rules: according to a recent poll by Insight of which failed that terrible night. The blocking, diluting, delaying or eliminat- West, report having experienced sexual citizens of Lac-Mégantic have been ex- ing regulations that negatively affect harassment in the workplace. ceedingly gracious in their acceptance their costs. Oil-by-rail traffic declined Perhaps most importantly, for the of the verdict. Many have expressed the in 2015-16, but as production increases longevity of the impact of #metoo, are view that the right people were not on and pipeline capacity bottlenecks loom, the 6.3 million women in Canada under trial. oil trains rumbling through our towns the age of 30 who don’t remember the In its wake, the government has and cities are on the rise again. Anita Hill hearings in Washington. an obligation to fulfil a number of Both diluted bitumen (dilbit) and Whose expectations haven’t been long-overdue commitments to im- Bakken shale are explosive products. ground down by years of watching the proving rail safety, and to the people of Oil companies have not been required perpetrators of sexual harassment Lac-Mégantic. First and foremost, its to remove their volatile components and assault go unpunished. Whose highest priority must be to ensure a rail prior to transport. This is unacceptable. worldview hasn’t become irreparably bypass around the town gets built. It will Despite the transport minister’s accel- darkened by watching those perpe- be five years in July. No more procrasti- erated phase-out of the old DOT-111 trators get promoted to positions of nation or buck-passing from the federal tank cars, the marginally safer tank increasing power—positions like Party government should be tolerated. cars currently hauling oil will not be Leader, Cabinet Minister, Senator. Trains carrying dangerous goods are fully replaced by the new strengthened It is in those young women that I find still being parked at that same location models until 2025. the greatest reason for hope—hope on the track that slopes down steeply The increase in train runaways in re- that the power of the #metoo move- to what was once the town centre and cent years indicates ongoing problems ment will live long after the currency of is still a vast open field. Unbelievably, with train securement practices. Most the hashtag fades. Hope that those who the quickly rebuilt track curve is even disturbingly, railways continue to have use their positions of power to do vio- sharper now than when the train too much freedom to self-regulate, to lence to women will face consequences derailed. The bypass is a precondition triage safety risks against costs. for their actions. Hope that there will be for the people of Lac-Mégantic to feel The federal government failed to a generation for whom such behavior safe again, to rebuild their lives and meet its primordial obligation to pro- is not only unacceptable, it is truly their community. tect the safety of its citizens from the unimaginable. M The trial was a distraction from the dangers of transporting oil by rail. The underlying causes of the disaster. The people of Lac-Mégantic paid the horrific Transportation Safety Board report price. As they struggle to rebuild and identified some but not all contributing ensure no other community has to factors. There are many unanswered suffer as they have, there can be no questions about what went on inside more prevaricating. As a society, we Transport Canada and related depart- owe them justice. M ments; about political interference and THIS ARTICLE FIRST APPEARED IN RABBLE.CA ON the actions of the industry. JANUARY 24, 2018. 15 Twitter enables targeted online abuse; and Google’s search ranking and ads perpetuate systemic discrimination through harmful stereotypes. But perhaps the most blatant BELOW THE FOLD hypocrisy, shared by industries old and new, is the siphoning off of public funds through tax avoidance and tax havens. CYNTHIA KHOO According to a recent report by Canadians for Tax Fair- ness, BCE Inc. (Bell Canada) paid an effective tax rate of 4.53% over a 10-year period ending 2014. Its statutory tax The ghost rate is 26.5%. Based on those numbers, we can estimate that this taxation gap produces a public deficit of roughly $6.5 investor billion—over eight times the cost of the CRTC’s broadband funding regime, and enough to fund the federal Connect to Innovate program 13 times over. A recent Toronto Star article updated BCE’s average 2011–2016 tax rate to 13.1%, suggesting Bell still pays less tax, proportionately, than the T’S HARDLY SURPRISING, given the size and market power of lowest-income Canadian (15%). today’s internet giants, that questions about their impacts Media coverage has confirmed that Facebook, Apple, Ama- on public life and governance are rising fast and furious. zon, Google, Microsoft, Uber, Airbnb and Twitter all engage in IWhat is surprising, however, is how consistently we refuse tax avoidance through numerous subsidiaries and tax havens, or neglect to acknowledge one of the central pillars of these sometimes resulting in single-digit or near-zero tax rates. entities’ private success: the public sector itself, in the form Whether it was the International Consortium of Investigative of public services, government support and a mass citizen Journalists (ICIJ) revealing Apple’s scramble to circumvent consumer base. Ireland’s tax reform, Fortune’s investigation into Uber, Skift on In telecommunications, popular industry rhetoric im- Airbnb or the European Commission’s high-profile crackdown plies that internet and mobile wireless providers exist in a on the whole gang, no platform has been left unscathed. bubble, or that they self-generated before landing on Earth Nor do any of them deserve to be. These socioeconomic with Promethean connectivity. Large carriers typically op- leviathans rely on public infrastructure and state govern- pose opening their networks to independent competition ance to operate; profit directly off of citizens’ everyday because of all the money they say they’ve invested. But behaviours, thoughts, self-expressions, relationships and this conveniently glosses over any federal or provincial personal data; and induce far-reaching negative external- funding they may have received, the rights of way they ities in the fabric of society itself. The absolute least they were granted, historical government-protected monopolies, could do is pay the actual taxes owed on what they made and the many hours of our elected representatives’ time at the public’s expense. they have appropriated with their lobbying. Combining tax inequity with other digital policy issues The contradiction between industry’s claims of salts the commons even further. For example, the Paradise self-emancipation from the state and evidence of their Papers leak found significant music royalties in offshore tax underlying dependence also shows up in the arguments havens, meaning some copyright owners take twice from of some carriers, before the CRTC, that people’s inability to the public domain: first through excessive copyright terms afford internet access is a poverty problem and therefore and enforcement, locking away culture and knowledge, the government’s alone. In other words, the private sector then through withholding public funds on the copyright has nothing to do with public welfare, despite depending royalties earned. on the public sector for infrastructure, investment, roads, While those benefiting from tax havens hasten to note education, health care, a (relatively) functional legal system they can have legal uses, copyright-owning industries put and other essential elements of growing a business. all their weight behind the opposite view—that no other Internet platform companies similarly depend on the motive exists than crime—in debates and lawsuits over public, even more so when you consider their exploitation peer-to-peer file-sharing, online storage websites, blank of users’ online activities, personal data and relationships. CDs and the Sony Betamax, all of which are and were also However, in contrast to telecom companies—who pretend used for legal purposes. The double standards abound. the public sector does not exist, is an inconvenience or has When protecting digital rights, or human rights, in the nothing to do with them—internet firms seem to think face of a breakaway digital economy, it’s important to keep they are the public sector. Mark Zuckerberg’s “Building the entire picture in mind. No person is an island, and no Global Community” manifesto and Reddit’s “we consider platform or company is either, as much as they’d like to think ourselves…the government of a new type of community” otherwise. As tax inequity rises on the agendas of Prime (emphasis added, HT Sarah Jeong’s Internet of Garbage) Minister Justin Trudeau and ministers Bill Morneau, Diane come to mind as prominent examples of this mindset. Lebouthillier and Navdeep Bains, it’s not too much to ask that While laudable, these ambitions can be hollow when put these businesses’ largest yet most invisible investor be able next to track records of damaging real communities and to expect—and actually receive—fair returns as well. M undermining public policy: Airbnb exacerbates housing cri- CYNTHIA KHOO IS A TORONTO-BASED LAWYER WHO FOCUSES ON INTERNET POLICY ses; Facebook facilitates fundamental threats to democracy; AND DIGITAL RIGHTS. YOU CAN REACH HER AT WWW.CYNTHIAKHOO.CA. 16 expansion of private sector 1,738 266 involvement in civil space Total number of operating Number of private activities a national goal. satellites in orbit at the end companies offering of August 2017, as compiled products and ser- 2004 by the Union of Concerned vices related to Space officially privatized Scientists. Among the nanosatellites. in the U.S. through the hundreds of satellites As of January 1, Commercial Space Launch launched last year, many there were an estimated Amendments Act. are smaller constellations 560 nanosatellites in Index of Earth-watching cameras orbit. 2006 Rockets and Satellites or communications Space Exploration satellites owned by Planet April 2018 Technologies (SpaceX), Labs, Spire and Iridium. Student teams to 1957 founded by Elon Musk be selected by the Sputnik, the first artificial in 2002 (a year before he 59% Canadian Space Agency Earth satellite, is sent co-founded Tesla), launch- Number of U.S. satellites in for the Canadian into orbit in October by es its first demo Falcon 1 orbit (476 of 803) owned by CubeSat Project, in the Soviet Union, causing rocket from a pad in the the private sector through which students will widespread panic in the Marshall Islands. the end of August, accord- design, build and U.S. ing to UCC. Of the rest, 150 operate their own 2011 were government-owned, nanosatellites. 1958 NASA’s shuttle program, 159 military and 18 civil. The first U.S. satellite once the only way to get “In 2016, commercial 200,000+ is launched in January. stuff and people into companies filed for a U.S. Estimated Explorer 1 was smaller and back from space, is Federal Communications number of than Sputnik but included cancelled. Commission licence for space objects, a Geiger counter, which 8,731 non-geostationary including 50+ detected what would communications satellites, debris (space eventually be known as the Missions flown by SpaceX’s including 4,425 for SpaceX, junk), orbiting Van Allen radiation belt—a Falcon 1, Falcon 9 and nearly 3,000 for Boeing, and Earth in 2014. zone of charged particles, Falcon Heavy (pictured) 720 for OneWeb.” U.S. aerospace mostly from solar wind, since then. and weapons held in place around the US$90 million maker 202 Earth by its magnetic field. Cost of sending a payload Lockheed Total number of private U.S. of up to eight metric tonnes Martin 4.41% space launches between into orbit on SpaceX’s estimates NASA’s share of U.S. budget 1990 and 2017. There were Falcon Heavy rocket. The there are spending at its high point 169 private European new SpaceX rocket can 200 threats in 1966 before collapsing launches in that time, also deliver the company’s to orbiting to its current level of about 162 Russian, 23 Chinese, Dragon spacecraft into satellites 0.5%. 4 Indian and 1 Ukrainian, orbit carrying goods (and identified among others. eventually humans) to the every day. 1973 International Space Station The Chinese 50+ Skylab, the first U.S. space and other future orbiting government is station, is launched into Number of objects destinations. experimenting orbit. launched into space with a laser between January 1 and US$4.9 million system for 1982 February 10 this year, Cost to send much smaller annihilating Space Services’ Conestoga according to the United payloads (e.g., nanosatel- dead satellites rocket becomes the first Nations Office for Outer lites) into orbit from New and other private space launch in the Space Affairs: 26 from the Zealand with the company non-essential United States. That same United States, 13 from Rocket Lab, which owns the orbiting year, Ronald Reagan issues China, 5 from South Korea, launch pad and the partially objects. a national security decision 3 from India and 1 from reusable rockets. directive making the Canada, among others.

Sources NASA; Penn Wharton (University of Pennsylvania) Public Policy Initiative; UN Online Index of Objects Launched into Outer Space; Union of Concerned Scientists; Forbes (based on Bureau of Transportation Statistics data); Federal Aviation Administration; International Business Times; Newsweek; Nanosats.eu. 17 18 Cover

STORY BY JOHN AKPATA / ILLUSTRATIONS BY ERIN TANIGUCHI Prometheus re-bound A long-time marijuana activist tries to make sense of Canada’s new cannabis capitalism

Nothing is so painful to the human thought to be immoral, dangerous The former Toronto police chief mind as a great and sudden change. and criminal. The members of the William Sterling “Bill” Blair was Marijuana Party have been unified made Parliamentary Secretary to the –Mary Wollstonecraft Shelley, by one common ideology: Cannabis Minister of Justice and the head of a Frankenstein should not be criminalized. In order nine-member task force on marijuana, to defend this position, I have had to responsible for co-ordinating with FIND MYSELF POISED between astonish- study botany, science, the policies of Health Canada, Public Safety and ment and outrage at the miserable Health Canada and Veterans Affairs each of the provinces and territories. marijuana monstrosity that has Canada, and the law. I am now, as I At this point, I am reminded of the been bred by the Trudeau govern- have always been, in a bit of a haze at Iron Chancellor Otto Von Bismarck’s ment and sold to doting Canadians the reasoning of it all. maxim about “laws and sausages,” Ias “legalization.” You might think that Having marijuana or cannabis which was actually a quote from legalization without decriminaliza- included in the schedule of the Con- lawyer and poet John Godfrey Saxe: tion is paradoxical, that one cannot trolled Drugs and Substances Act and “Laws, like sausages, cease to inspire exist without the other. You might enforcing that with the Criminal Code respect in proportion as we know how believe that law is based on logic and is outrageous. It is non logical. It defies they are made.” My personal respect facts. My skeptical nature had me the laws of nature, science and the will was ceased not by process, but by the anticipating that “legalization” actu- of the people. Marijuana prohibition man in charge. ally meant “financialization,” that is, is a monster roaming the countryside Bill Blair was the chief of Toronto a regulated framework of legal and that kicks in doors and takes property Police during the infamous G20 financial engineering that would away; takes children away from their summit in Toronto. In June 2010, create a new species of aristocrat, the parents; randomly beats down the 1,100 people were arrested, including Canadian Marijuana Entrepreneur. public; handcuffs people and saddles some kettled by riot police in the rain. My healthy distrust of government them with a criminal record. Humans It was the largest mass arrest in Ca- had me predicting that legalization become outcast before they can apply nadian history. In April 2015, Ontario would also continue to oppress and for a “pardon,” or a “record suspension” ombudsman André Marin reported criminalize minorities and the poor. as it is now called. Yet, Bill C-45 is that Blair’s handling of the G20 was Two years ago, I speculated “It’s going creating a monopoly for the rich; Bill “the most massive compromise of civil to get worse before it gets better.” C-46 will let the police continue to beat liberties in Canadian history.” The Now bills C-45 and C-46 are slouch- down the poor. heavy-handed response, which was ing toward Ottawa to be born. Now, seen as an egregious abuse of power it’s worse. and a massive human rights violation, I have been a member of the Mar- Sausages led many to call for the resignation of ijuana Party since 2004. I have run It’s been over two years since Justin the chief, but Blair remained aloof of in the last five federal elections and Trudeau said the new Liberal gov- the whole affair. “I’m responsible for am currently the peace officer for ernment would legalize marijuana policing and safety in Toronto,” he the party. I have had to consistently “right away.” When the Prime Minister said. “I wasn’t making the operational deconstruct the flawed thinking of formed his cabinet, he appointed a decisions that weekend, but it’s still reefer madness; I have had to face lawyer to be Minister of Justice, an my town and my responsibility.” the medusa of racism that hides in infantry officer to be Minister of Na- You’ve heard of “sorry not sorry”? the history of Emily Murphy; I have tional Defence, and an astronaut to be Well here’s “responsible not responsi- suffered the slings and arrows of every Minister of Transportation. One would ble.” Blair later explained that he had Cheech and Chong joke; I have smiled reason that a scientist (a biologist or misinterpreted regulations from the at every Jimi Hendrix or Bob Marley a botanist) or health expert would be Ontario cabinet on the increase of reference; I have risked my personal put in charge of drafting marijuana police powers for the G20 summit. The and professional reputation by align- legislation in 2015. Instead, Trudeau man that misinterpreted provincial ing myself with something that was appointed a police officer. law is now in charge of drafting federal 19 law. The man that facilitated people getting stomped on In October 2017, I attended the Ottawa Cannabis and by horses and thrown into pop-up prisons, like in the dys- Hemp Expo at the Shaw Centre. It was a mixture of glass topian filmPunishment Park, is now in charge of making blowers, bong sellers, people hocking LED grow lights and the Frankenstein sausages of legal marijuana. different home-grow systems, and something that I had never encountered before called the “cannabis consultant.” For $20,000, these guys would do all the paperwork for The elite 89 your LP application, find you a commercial property, ensure So, some of my outrage comes from the appointment of that you met the requirements of Health Canada, and get Bill Blair, which I can only view as a foreshadowing of you a licence to grow. They weren’t lawyers or government police abuse on an epic scale (more on this later.) As for officials, they were all information middle-men, “brokers” my astonishment, that comes from the current marijuana that made lots of assurances but no real guarantees on industry as it is shaping up, based on the numbers—and your application. by numbers I mean money. As of March 2015, Health Canada had received nearly Canada’s current marijuana climate—the foundation 1,300 applications for commercial growing licences. Ap- on which a “legitimate” industry is now being constructed proximately 75% of applications do not meet the standards. with the co-operation of the federal and provincial govern- They are rejected, assessed as incomplete or withdrawn ments—was created by the sick and the poor who were completely. The first few LPs spent around $1 million to for decades persecuted by police and the courts. It is their meet the standards set by Health Canada. In order to meet resistance, their court battles and their sacrifice that have the standards created by C-45 an LP will cost $5–10 million. resulted in today’s marijuana reforms. So, aside from the rare application where a “cannabis But a curious thing happened on the road to legalization: consultant” is successful, how does one actually get to what was once known as marijuana is being transformed create an LP? Prepare to be astonished. into cannabis. The new cannabis laws are designed for political insiders and an elite group of entrepreneurs who have emerged from what is now referred to as “the grey The fix is in market” or “the former underground economy.” Canada’s A monopoly is the exclusive possession or control of cannabis industry is all about the licensed producer (LP). the trade in a commodity or service. An oligarchy is a Health Canada issues authorized licences to produce can- government of a small group of people. A plutocracy is a nabis for medical purposes under the Access to Cannabis government of the wealthy, for the wealthy, by the wealthy. for Medical Purposes Regulations (ACMPR.) There were, Canada’s burgeoning for-profit cannabis industry is a fas- at publishing time, 89 LPs in Canada, all fairly small com- cinating conflict-of-interest mélange of elected officials, panies (though some of them with big market clout), most high-ranking police officers, and almost exclusively white having around 100 employees. Many of these corporations, Anglo males, who are trying to figure out how to capture licensed to grow what was once called “medicinal marijua- and control the whole industry. A 2017 Maclean’s article na” for licensed recipients, are simultaneously preparing compiled an interesting list of some of the players. themselves to be able to grow “recreational marijuana” or That list includes famous insiders such as Senator Larry “cannabis” under Bill C-45. Campbell, a former RCMP officer and Vancouver mayor Wordplay aside, LPs are grow operations that have made who is now an advisor to Vodis Innovative Pharmaceuticals it through a rigorous system, passed all the inspections, Inc.; Norman Inkster, an independent director at Mettrum met the requirements and have been given the green light. who was once head of the RCMP; Dr. Joshua Tepper, former Wouldn’t you love to start a LP? Yes I would, or so I thought. assistant deputy minister of health and one-time senior medical officer for Health Canada (also an independent director at Mettrum between 2014 and 2016); Mike Harcourt, a former B.C. premier who is now the chairman of True Leaf Medicine Inc.; George Smitherman of THC BioMed, a former Ontario Liberal deputy premier and minister of health; and John Turner, former prime minister, who has an open medicinal marijuana application in Ontario. The men who are going to We can also add Kash Heed, a strategic consultant with profit the most from the National Green BioMed who was formerly B.C.’s solic- itor general and a West Vancouver police chief; former multi-billion-dollar cannabis Vancouver-area federal cabinet minister Herb Dhaliwal, industry are veterans of the currently the chairman of National Green BioMed; and Tim Humberstone, a 20-year veteran of the RCMP’s municipal establishment. They formerly and federal drug enforcement sections who spent time on enforced the law, incarcerated the B.C. Organized Crime Agency, who is now a director of Abcann Medicinals. (Humberstone has provided expert people, and were the status court opinion in the fields of cannabis trafficking and quo. production techniques.) 20 The men who are going to profit the most from the ground-floor creation of a multi-billion-dollar industry are veterans of the establishment. They formerly enforced the law, incar- cerated people, and were the status quo. Now they are going to be the international profiteers who benefit from the legal recreational growth and distribution of cannabis.

Stocks, dude

So much has been done, exclaimed the soul of Frankenstein—more, far more, will I achieve; treading the steps already marked, I will pioneer a new way, explore unknown powers, and unfold to the world the deepest mysteries of creation. –Mary Wollstonecraft Shelley, Frankenstein international producer of beer, wine the same infraction. Both companies One of the problems with articles on and spirits that has operations in the were found to be selling medical Canada’s cannabis industry is that the U.S., Canada, Mexico, New Zealand and marijuana that contained chemicals handful of top LPs are going to get a Italy, and they are the first LP to be not authorized for use in cultivation, tonne of free publicity when weed is underwritten by a major bank (BMO including trace amounts (up to 20 “legalized.” The media, the public and Capital Markets and GMP Securities parts per million) of the pesticide my- everybody trying to cash in on the bought roughly five million shares in clobutanil, which produces hydrogen green wave is going to have to go to Cannopy for $175 million earlier this cyanide during combustion. Company the experts, the insiders, to determine year). This shift from one of Canada’s stocks tanked (albeit temporarily) on what is best practice, based on what big six banks means that many more the news, and both are facing a class they have already made a deal on. But LPs will be able to benefit from the action lawsuit from patients who I think that the public should know financing and commercial banking unknowingly ingested the chemical just how big these grow operations that they desire. through use of their medicine. The are, and how incredibly ambitious Aphria Inc. had a market capital- upside in a for-profit market is that their profit motives are. ization of about $2.5 billion in early if the companies settle, or if they Clearly number one is Canopy February. The cannabis company successfully defend, there’s always Growth, aka Tweed. The company has raised capital through private the option of changing their name, and operates famously in a former Her- investors, without any major banks their stocks will go up again. Mettrum shey’s factory in Smiths Falls, Ontario backing them yet. In late January, was purchased by Canopy Growth and was the first federally regulated Aphria announced it had entered into in 2016, and OrganiGram’s stock has publicly traded marijuana producing a definitive arrangement to acquire soared since September 2017. corporation in North America. Cano- 100% of Nuuvera Inc., a cannabis Supreme Pharmaceuticals is py has around 650 employees and a company with a strong presence in the only company that is a busi- market capitalization of over $6.5 bil- Europe, Africa and the Middle East. ness-to-business grower. All other LPs lion. The company has about 665,000 Aphria is growing by purchasing in Canada sell direct to the consumer, square feet of growing capacity with portions of smaller companies, which but Supreme grows for other LPs, as plans for significant expansion. is basic yet effective business. If your they have a licence to cultivate but In December 2017, Canopy announced company makes a bad investment, you not to sell. Their 342,000-square-foot plans to open a 40,000-square-foot grow can sell it off, most likely at a profit, grow facility is one of the largest facility in Odense, Denmark to cater before that other company, which is in the world. By 2019 they will have to medical marijuana patients in the your competition, tanks. invested over $70 million into their Scandinavian country (in a partnership OrganiGram Inc. was the first LP to corporation and hope to expand to with Spectrum Denmark, a European have a recall for pesticide contamina- over 300 employees. The goal is to Hemp producer). Canopy also has a tion when it failed an inspection by reach a maximum output of 50,000 business deal with Constellation, an Health Canada. Mettrum Ltd. also had kilograms per year. Once Health 21 The reefer madness scare The man was shocked. “It’s already happening,” he said. “We have to get in on the ground floor before somebody tactics employed by detractors else does.” in the Senate and by opposition At the time, I thought that this person was either high or hallucinating if he thought that a Canadian company parties have no scientific basis could set up shop in Jamaica. The idea was inconceivable whatsoever. to me. It turns out that I was as naive as ever, unaware of the larger plans of some Canadian entrepreneurs. Timeless Herbal Care was founded by a Toronto law- yer one month before I had arrived. It has ties to Israel, Canada and Jamaica. Timeless has established strategic partnerships with the University of the West Indies, the University of Technology Jamaica, and O.penVAPE, produc- ers of the Ziggy Marley signature vaporizer. Ernie Eves, the former Progressive Conservative premier of Ontario, joined Canada approves their licence to sell recreational as well the company as its chairman. “Huh,” I thought, “Canada is as medicinal cannabis, they will most likely be one of the trying to colonize the world with grow operations.” most profitable cannabis corporations on Earth.

Save the children Colonize this When it comes to the creation of regulations and drafting In February 2017, I went to Jamaica to be a feature per- of laws, one principle is to ensure that the most vulnerable former at the 14th Annual Poetry in Motion Festival, held people in society are protected. That usually means the in Mandeville. I was featured in two newspapers and did elderly and children. As such, the federal government three radio broadcasts to promote the show. I was John has fomented the idea that they have to strictly limit or Akpata, international poet, not John Akpata, marijuana block access to cannabis to young people, for their own politician. During my stay, I had several people try des- protection. Bright colours and logos will not be allowed perately to get in touch with me through social media on packaging. Advertising will be tightly controlled for the and through my host. They invited me to their homes, same reason, and all cannabis activity is to happen well their yards and their gardens because they wanted input away from any schools, where young inquisitive minds and advice on their plants. Keep in mind that Jamaica may be enticed to experiment with the herb. decriminalized marijuana in February 2015. Possessing two There will be severe penalties for those who sell or give ounces may result in a small fine (approximately US$5) marijuana to youth (up to 14 years in prison) or otherwise and no criminal record. Each person is allowed to grow exploit them in the trafficking of cannabis. That length of five plants at a time, and Rastafarians are allowed to use sentence is in the ballpark of what you’d get for producing marijuana as sacrament. child pornography or engaging in terrorism, so I suspect One of the people I met was an extremely enthusiastic there will eventually be a Charter challenge to this aspect Canadian from B.C. who was overly excited to meet me. of the law. Currently, the penalty for supplying alcohol to He had dozens of plants around his property, in myriads a minor is a maximum of one year in prison. of pots, at different stages of growth, and some monsters Under the proposed federal rules, people aged 12 to 18 in the ground. He didn’t know much about genetics, could will be able to possess five grams before facing criminal not differentiate sativa from indica, lost track of which charges. According to Ralph Goodale, the federal minister plants were from seed and which from cuttings. All he knew for public safety and preparedness, “a person with a very was that he wanted to make a profit. He was determined small amount of cannabis in their possession should not to partner with anybody, needed a source of seeds, and face a criminal record.” There will also be zero tolerance wanted a famous spokesperson for the branding of his for drug-impaired driving for anyone 21 and under, novice corporation. drivers, and all commercial drivers. In Ontario, a fine for He told me that with my previous life experience, my drug-impaired driving would range from $250 to $450. dreadlocks and general appearance, I was exactly who In September 2002, the Senate’s special committee on he needed to make him legit. His goal was to become the illegal drugs published “Cannabis: Our Position for a Ca- number one marijuana producer on the island before nadian Public Policy,” which recommended 16 years as the anyone else got to it. threshold for legal access to cannabis. Fifteen years later, in “I’m not interested in competing with Jamaicans on September 2017, a House of Commons standing committee their island for growing marijuana for profit,” I told him. on health that was assessing the Liberal legalization plans “Don’t you think that Jamaicans can grow their own? Don’t heard from marijuana activist and former Liberal hopeful you think that they would rather have their own citizens Jodie Emery (the party rejected her as a candidate for the and people making the money off of ganja, as opposed to last election) about how incongruous these age limits were. importing foreigners who are going to take the money out Emery quoted a Journal of Adolescent Health report sug- of the country?” gesting that teens do not exhibit an increase in psychosis 22 with cannabis alone. Only those with of Health Canada with a budget of Add Bill C-46 to what already exists genetic predispositions, and those $36.4 million. Another $9.6 million and I suspect that police will have a who used tobacco and alcohol, showed over five years will focus on public marijuana chip on their shoulder increased symptoms. Emery also education, awareness and surveil- while they racially profile on the open quoted a 2016 report from the British lance. Under the current Controlled roads. Association of Psychopharmacology Drugs and Substances Act there are that claimed there is no IQ loss in eight cannabis-related offences, such users of cannabis, even in long-term as importing, exporting, trafficking Recreational medicine users. The American Psychological and possession. Under the Cannabis There are over 100,000 medicinal users Association in 2015 reported that Act there will be 45 offences with of cannabis in Canada. Like Emery, the majority of cannabis-only users, penalties that can only be described Philippe Lucas from the Canadian even youth, have no health problems as severe. Medical Cannabis Council has also associated with cannabis. Although the enforcement arm of made recommendations on legaliza- All of this suggests strongly that the the new law is being advertised as tion to the House of Commons health reefer madness scare tactics employed protecting children and youth and committee. The CMCC, which repre- by detractors in the Senate and by keeping drug-impaired drivers off sents seven LPs that supply 40,000 opposition parties, and ridiculous the roads, my dreadlocks start to tin- patients, conducted a national patient notions about pot dealers in schools gle when I consider actual statistics: survey that garnered 2,032 responses ruining the minds of children, have no 27,000 Torontonians were arrested from medical cannabis users. The scientific basis whatsoever. It’s when for marijuana possession in 10 years; information pulled from the results it comes to getting behind the wheel Black people were charged at more is very interesting. of a car, however, that young people than three times the rate as white The average age of a medical tip the scale. people with similar backgrounds; cannabis user is 40. Most sought out According to Statistics Canada, once charged, Black people are more cannabis after other treatments had “drug-impaired driving peaks among likely to be detained for bail; a 2005 failed (i.e., they were seeking alterna- young adults, with a rate of 17 inci- profiling study found that Kingston tives). The CMCC survey found that dents per 100,000 drivers aged 20 to police stopped Black people 3.7 times about 40% of users are medicating for 24.” This category is also more likely more than their white peers. insomnia, mental health and PTSD; going to be accused of impaired driv- In October 2016, a similar report 37% use for body pain and headaches; ing. So, although many adults decry on profiling was released in Ottawa. 78% use less than three grams per the validity of police doing roadside The Traffic Stop Race Data Collection day, and most use 0.5–1.5 grams; 31% stops to determine who is “impaired” Project showed that Ottawa police of medical users vaporize instead of or “intoxicated” with cannabis, I have demonstrated bias and prejudice, smoking; 69% use cannabis instead always believed the police are most from every police officer that gener- of prescriptions; 35% use cannabis likely going to ruthlessly target young ated data, against Black and Middle instead of opioids; 44% use cannabis people for driving while blazing, and Eastern people, who are dispropor- instead of alcohol and 26% use canna- most likely violate their youthful tionately pulled over. Blacks get pulled bis instead of illicit drugs; 60% gave rights with impunity. over 2.3 times more often than others up opioids altogether, and 31% gave Bill C-46 comes with a $274-mil- in the population, and those perceived up alcohol altogether. lion budget to detect and deter any to be Middle Eastern are pulled over Lucas told the committee of a study drug-impaired driving. Police will be 3.3 times more often than the rest of in the Journal of the American Medical able to pull over the driver of a vehicle, population. Association showing that medical based on their reasonable suspicions of impairment, and demand an oral fluid sample to determine whether or not the driver has THC in their body. Three new offences have been created for having specified levels of THC in the blood within two hours of driving. Any of these tests can determine whether there is THC in your blood, but they cannot determine your level In Canada, over one million people of impairment. Tests can also include a have been charged with a marijuana blood sample or a drug test at a police station, and will most likely incur crime and over 500,000 people another Charter challenge. currently have a criminal record Over the next five years, a cannabis education and awareness campaign ahead of the summer 2018 deadline will be launched under the direction for marijuana legalization. 23 cannabis use reduced rates of violence, homicide, suicide He recognized that a record suspension would be the fair and accidents. According to his presentation, teen use of and equitable thing for the Liberal government to do, es- cannabis has declined in all U.S. states where medicinal pecially in the face of impending recreational legalization marijuana is legal. (and, perhaps, another upcoming federal election in the The Supreme Court ruled that medical marijuana pa- fall of 2019). tients should have access to edibles. The only way to do so Justin Trudeau was wishy-washy and lukewarm when today is to purchase cannabis from LPs and make your own. questioned recently about Goodale’s sentiments, which is The non-legal cannabis producers have moved on to edibles a shame. Any reasonable person who knows a few facts as a staple in dispensaries. The future lies in LPs reaching would support amnesty. Approximately 55,000 people out to edibles producers, but there are no Health Canada were charged with a marijuana-related offense in 2016, regulations in place for edibles yet. Perhaps that is why, 17,733 for simple possession of pot, according to Statistics as of August 31, 2017, there are 10,547 Canadians approved Canada. Approximately 30% of court time is dedicated to to cultivate for personal use, an increase of over 50% in drug offences where there was no harm, loss or injury. It two months. will be difficult to determine who is eligible for a record suspension for marijuana, as most police forces do not differentiate between a marijuana offence and an offence Set the captives free for other drugs. Possession is possession, of what, nobody In the federal election of 2015, when Justin Trudeau prom- specifies. ised to legalize marijuana, I adopted a wait-and-see attitude. California’s 2016 ballot initiative to legalize the produc- I did what was required to get my name on the ballot (in tion, distribution and use of marijuana for recreational Ottawa Centre), but was not interested in participating purposes also included the reclassification and/or ex- in a 13-week campaign where every federal political party pungement of marijuana-related offences. For those still except the Conservatives had promised to either legalize serving sentences there will be opportunities for re-sen- or decriminalize marijuana. I attended only the all-candi- tencing. When the law came into effect on January 1, 2018, dates debate at Carleton University, and was allowed one California officially ended the war on marijuana, which question. disproportionately targeted non-white citizens. When I asked the panel of candidates how long it would take Uruguay legalized marijuana in 2013, the government to expunge the criminal records of every marijuana-re- included a strong emphasis on public health and human lated offence in Canada? How much they were going to rights. compensate people for the harm done to these people? In Canada, over one million people have been charged How long it will take to let people out of prison? And, with a marijuana crime and over 500,000 people currently at the end of the day, how many plants can I grow? have a criminal record ahead of the summer 2018 deadline Both the Liberal candidate, Catherine McKenna, and for marijuana legalization. If the Liberals do not create a the NDP’s Paul Dewar were shocked. “Nobody has ever mechanism for widespread record suspensions this year asked that before,” said Dewar. McKenna, now Canada’s they can expect an election battle from opposition parties, environment minister, spoke about drafting legislation as well as a class action lawsuit from a group of lawyers that would protect children and keep the profits away in Toronto who are including racial profiling statistics in from organized crime. their strategies. It was not until January this year that Public Safety I was asked on CBC News in January to respond to Minister Goodale said those Canadians who have a criminal Goodale’s and Trudeau’s statements on pardoning people record for simple possession of marijuana deserve amnesty. with marijuana records. I said I agreed with the minster, but added that amnesty does not go far enough. There should be an apology issued to all Canadians for past marijuana practice, especially directed to those harmed by an old-fashioned, outdated and antiquated prohibition system that has ruined lives, destroyed families and pun- ished people who, according to the Canadian public, should not be criminals at all. Perhaps during the next election I will again break out Canada’s current marijuana the soap box, climb up my high horse, and quote warnings from Mary Shelley Wollstonecraft and declarations from climate—the foundation on which Bob Marley: a “legitimate” industry is now I had desired it with an ardour that far exceeded mod- being constructed—was created eration; but now that I had finished, the beauty of the by the sick and the poor, who dream vanished, and breathless horror and disgust filled were for decades persecuted by my heart. –Mary Shelley Wollstonecraft,Frankenstein. police and the courts. Set the captives free. –Nesta Robert Marley, Exodus. 24 Feature

JOEL LEXCHIN Crisis at the pharmacy ILLUSTRATION BY KATIE RASO There’s a connection between high drug prices, high company profits and poor health outcomes. A better regulatory system could sever it.

HERE IS A crisis in the pharmaceu- $700,000 a year. There are now 19 Various experts have advanced tical world, but it is not a crisis of drugs on the Canadian market that ideas about how to resolve this crisis. profitability. In December 2015, cost more than $50,000 a year, and an In his recent book, Rigor Mortis: How TForbes magazine reported net additional 55 that come in at $20,000 Sloppy Science Creates Worthless profit margins of 25.5% for “major” to $50,000 annually. It might be fine Cures, Crushes Hope, and Wastes pharmaceutical companies, 24.6% if we could say we were getting what Billions (Basic Books, 2017), Richard for biotechnology firms and 30% for we’re paying for, but the facts often tell Harris explores the crisis in research generics. Comparable rates for tobac- a different story. that stems from the inability of one co companies, internet software and Among all cancer drugs for solid lab to reproduce the results of anoth- services, information technology and tumors introduced in the U.S. be- er. Mislabelled cell lines, mishandled large banks were 27.2%, 25%, 23% and tween 2002 and 2014, the median gain ingredients and “the economic imper- 22.9% respectively. in overall survival was a modest 2.1 ative for researchers to get and keep No, the crisis in the pharma sec- months. For breast cancer the best jobs and funding encourages dubious tor is in the escalation of prices for increase in survival was 4.2 months behavior, from poor experimental de- individual drugs, especially but not (using ado-trastuzumab emtansine for sign to sloppy statistics and shoddy exclusively in the United States, and HER2-positive metastatic disease) and analysis,” he writes. the low number of new products that comparable data were not known for In a 2017 working paper, the offer major therapeutic gains over ex- three of the 10 new drugs. According economist William Lazonick and his isting medicines. The industry’s lavish to the French drug bulletin Prescrire, colleagues document how pharma- profits make these deficiencies all that of 1,032 new drugs and new uses for ceutical companies are not plowing much harder to tolerate. old drugs introduced into the French their profits back into research and For example, the cystic fibrosis market between 2004 and 2015 only development (R&D) on newer and treatment Kalydeco was initially 66 offered a significant advantage better drugs. More money is going into priced in Canada at $300,000 a year. whereas more than half were rated paying out dividends and buying back Until recently, Soliris, a medication as “nothing new,” and 177 were judged corporate stock—a recurring feature for a rare disease involving blood cells “unacceptable” because they came with in our economy a decade after the and the kidneys, sold for a staggering serious safety issues and no benefits. Great Recession. Lazonick et al. note 25 that between 2006 and 2015, the 18 objective the companies will behave in federal government has sought to U.S. pharma companies listed in the all instances above board. “Economic co-operate with the pharmaceutical S&P 500 Index spent $465 billion on theory predicts that firms will invest industry, to the point of sometimes R&D, $261 billion on stock buybacks in corruption of the evidence base actively promoting the its interests and $255 billion paying out dividends. wherever its benefits exceed its costs,” through legislation and policies, even “Incentivizing these buybacks explains the British economist Alan when those interests conflicted with is stock-based compensation that Maynard in an unpublished report the public interest. In some areas rewards senior executives for stock- (shared with me). “If detection is Canada has voluntarily turned over price ‘performance,’” the economists costly for regulators, corruption of de facto regulatory power to industry. explain. Buybacks automatically the evidence base can be expected to These were not isolated moves increase earnings per share by reduc- be extensive. but represent a global phenomenon. ing the number of shares available. “Investment in biasing the evidence Neoliberal reforms enacted by west- That, in turn, leads to an increase in base, both clinical and economic, in ern governments, including Canada, demand for shares and higher share pharmaceuticals is likely to be de- over the past two or three decades prices, which rewards executives who tailed and comprehensive, covering have prioritized intellectual property receive most of their income through all aspects of the appraisal process,” he rights over things like affordable stock-based pay. continues. “Such investment is likely access to medicines (here or in the According to Lazonick, pharmaceu- to be extensive, as the scientific and Global South), and they have altered tical companies should be developing policy discourses are technical and drug-pricing and R&D policies to the new innovative products that can be esoteric, making detection difficult benefit of the industry. sold at affordable prices, but instead and expensive.” Therefore, it should not These reforms were not simply an the companies that dominate the U.S, come as any surprise that companies’ incarnation of laissez faire capitalism. industry restrict product develop- economic aims seem to conflict with In true neoliberal fashion they were ment and raise prices. their declared goal of improving health. acts of the state to facilitate markets, Both Harris and Lazonick et al. The point that Davis and Abraham i.e., to adopt a regulatory regime that provide a number of recommen- make in their 2013 book is that society encourages capital accumulation as dations that would improve upon has a dual expectation from the phar- its main raison d’être. It would be a the current situation, which we can maceutical industry: companies should mistake to see the Canadian govern- summarize as sky-high pharma profits make profits for shareholders and ment as a passive victim of external alongside lackluster R&D and drug investors, but those products should pressure; rather, it actively co-operated performances. However, both largely also provide a health benefit. From in the normalization of a pro-pharma leave the current regulatory model the viewpoint of the industry that is regulatory environment and the re- intact and therefore do not get at exactly what has been happening, as linquishing of national authority over the root of the problem. Taking my reflected in the economic outcomes. intellectual property rights. lead from Courtney Davis and John Governments and their drug regu- In the mid-1990s, Health Canada’s Abraham’s influential book, Unhealthy latory agencies are less trusting and introduction of pharmaceutical Pharmaceutical Regulation: Innova- therefore act as a check on industry company user fees (to help fund part tion, Politics and Promissory Science assertions of effectiveness and health of the drug approvals process) estab- (Palgrave, 2013), I believe we should benefits. lished the industry as a client of the adopt an empirical (realistic) and inter- “Yet there is a paradox at the heart government—as a contracting agent ests-based approach to understanding of pharmaceutical regulation in the whose needs should be met by the and resolving this crisis. neo-liberal era,” write Davis and regulatory system. One of those needs Abraham. “On the one hand, state was speed. Each day of delay in getting hat would realistic reform look regulation has been introduced and a drug onto the market could mean the like? Well, first, it would ap- maintained on the assumption that loss of millions of dollars in sales for Wproach the industry as it is now the interests of the pharmaceutical pharma companies. constituted. We should not be under industry and public health do not Not only were speedier drug any illusions about why pharmaceu- always converge. On the other hand, reviews made a priority, but Health tical companies exist and what they the last 30 years has seen a raft of Canada devised two mechanisms to do. Like any other corporations, they deregulatory reforms, ostensibly to get drugs through the system even have an obligation to make profits promote pharmaceutical innovation faster: priority approvals, and a pol- for shareholders and investors. They deemed to be simultaneously in the icy of granting conditional approval should therefore do whatever is legal commercial interests of industry and to medications based on preliminary to advance this objective. This is not the health interests of patients.” evidence, called Notice of Compliance a cynical statement but a realistic In my recent book, Private Profits with conditions (NOC/c). Both of these one, and it would be naïve to think vs. Public Policy: The Pharmaceutical mechanisms were much more valua- otherwise. Industry and the Canadian State ble for industry than for the health It would be just as naïve to think (Lorimer, 2017), I use the insights from of the public. Drugs with marginal that in pursuing this profit-focused Davis and Abraham to show how the value were marketed more rapidly; 26 those that went through the priority review and NOC/c One relatively weak model for achieving separation was processes were much more likely to receive serious safety proposed by Stan Finkelstein and Peter Temin in their warnings or be pulled off the market, further damaging 2008 book, Reasonable Rx: Solving the Drug Price Crisis the health of patients who took them. (FT Press). Although they are primarily concerned with Focusing on the needs of the industry client also meant drug prices, the authors, both MIT professors, suggest the that Health Canada was not willing to devote the necessary creation of an independent, public nonprofit, the Drug resources to monitoring the safety of products once they Development Corporation (DDC), to acquire new drugs were approved. Even if safety problems were identified, emerging from private sector R&D and then transfer the warnings about them could be subject to prolonged negoti- rights to sell the drugs to a different set of firms. ations with companies. The value of communications that In addition to its role in helping to reduce drug prices, Health Canada issued to health care professionals and the the DDC would be mandated to submit “the results of all public regarding safety issues was never evaluated. Inno- basic scientific studies and clinical trials…for publication in vation, as defined by Health Canada, was tailored to meet peer-reviewed journals as soon as patent and other intellec- the needs of industry, emphasizing new drug molecules tual property considerations permit,” write Finkelstein and rather than better drug therapy. Temin. The DDC would also make all negative trials public. Layered on top of poor regulation of clinical trials, faster Although this last function would helpfully increase the drug approvals and poor safety monitoring has been the availability of information, research design and the trials refusal of Health Canada to do anything effective about process would remain in the hands of the pharmaceutical the way that medications are promoted to doctors and industry. the public. Control over promotion to consumers of both A stronger version of Schafer’s separation model would over-the-counter and prescription-only drugs was progres- see an institution such as the Canadian Institutes of Health sively weakened and handed over to private interests with Research organize and manage clinical trials and the data little to no oversight by Health Canada. Complaints about that comes out of them, with funding coming from taxes regulatory violations in direct-to-consumer advertising of collected from the pharmaceutical industry and/or general prescription drugs are ignored for months or longer and tax revenue. As Tracy Lewis, Jerome Reichman and Antho- then dismissed. ny So argue in a 2007 article, drug companies under this Finally, Health Canada’s position vis-à-vis the interests model “would no longer directly compensate scientists for of industry versus those of the public is encapsulated by evaluating their own products; instead, scientists would its obsessiveness in keeping information secret on the work for the testing agency.” grounds that it is commercial business information, al- However, the authors argue that the companies should though there are some hopeful signs that the organization continue to fund a significant portion of the research is finally changing its position in this regard. agenda, “in order to discourage the wholesale testing of Without tackling these basic contradictions in the marginal drugs with little therapeutic value, or candidate pharmaceutical world, all of the other problems—with medicines with little chance of clinical adoption.” While intellectual property rights, corruption of the regulatory companies would continue to develop and market their system, high drug prices, promotion to doctors, etc.—will products, this would be separated from the process of only fester. generating and interpreting clinical data. Dean Baker, co-founder of the Centre for Economic Policy working group from Physicians for a National Health Research, goes even further in a 2008 report, arguing for a Program (U.S.) and Canadian Doctors for Medicare has system whereby all clinical trials would be publicly financed, A been developing a set of proposals for radically reform- with the cost of the trials in the U.S. being covered through ing drug policy, including the creation of new institutes lower drug prices under Medicare and other public health for prescription drug development in both countries. The care programs. The benefits of publicly funded trials would institutes would prioritize drugs for development based on include trial data staying in the public domain, the minimi- their potential clinical utility, focusing on diseases that are zation of commercial conflicts of interest, and the ability neglected, commercially unprofitable, lacking in effective to redirect research away from “me-too” drugs (with little treatments or are of particular public health salience. additional benefit over existing products) and toward real in- Because the new agents would be unpatented, they could novations, including unprofitable but essential treatments. be produced or purchased at a low price by other nations, At present, despite over a decade of talking about improving global population health. reforms, no country has yet had the political will to im- To deal with the problems of companies controlling plement any meaningful changes. However, that does not clinical trials and the data that comes out of them, Arthur mean that change is not possible. Tommy Douglas, who Schafer, director of the Centre for Professional and Applied as premier of Saskatchewan first introduced universal Ethics at the University of Manitoba, has proposed that first-dollar coverage for hospital and doctor services in the research and commercialization processes must be Canada, famously said: “Courage, my friends; ’tis not too separated, which would include the complete isolation late to build a better world.” Taking inspiration from the of industry from clinical trial data. There are better and public health care pioneer, there are plenty of good ideas worse ways to do this, as far as I’m concerned, or weaker out there for building a better pharmaceutical system. It’s and stronger models. a matter of finding the courage to implement them. M 27 Feature

SETH KLEIN Site C’s economic ILLUSTRATION BY REMIE GEOFFROI justifications are unconvincing Approval of controversial dam project shows it’s time we made decisions differently.

HE DECISION TO proceed with the considerations win the day. That’s why UNDRIP is the duty to secure consent Site C dam was clearly a very dif- unpacking this decision matters—so before engaging in major projects ficult one to make. With $2 billion we can consider how progressives that impact the land and title of Talready spent on the project by might shake up the framework by First Nations people. Achieving that their Liberal predecessors, the new which future decisions are made. consent should be embedded in our Horgan government was forced into First things first, the Site C approval decision-making process. And yet in a no-win choice: there would be sub- does deep harm to the prospects this case it is absent. stantial political and economic costs for reconciliation with Indigenous For thousands of people who for either terminating or proceeding people. It is fundamentally at odds strongly oppose Site C, for both en- with what is one of the largest and with the government’s stated com- vironmental reasons and because of most expensive capital projects in B.C. mitment—affirmed in the NDP-Green its impact on Indigenous rights, this history. I don’t envy the NDP, but nor Confidence and Supply Agreement decision feels like a political betray- do I think they chose wisely. and in the mandate letters of each al—and will for many years. And with In a difficult decision like this one, minister—to implement the United every likely new announcement of a it matters who gets listened to, whose Nations Declaration on the Rights of cost overrun in the years to come, more expertise wields authority and what Indigenous Peoples. Fundamental to salt will be ground into the wound. 28 The CCPA’s Marc Lee, in his submission last summer As the CCPA has noted in past research, hydro rates to the B.C. Utilities Commission, outlined why he felt the are regressive: they impact lower-income households electricity that Site C will provide is not needed. Indeed, our harder than upper-income ones. In contrast, provincial contention for many years has been that what was truly government debt is serviced from overall taxes, which driving the push for the dam was the natural gas industry’s are mildly progressive now that the new government has demand for electricity—both for fracking operations and, brought in an upper-income tax bracket and is phasing out down the road, to electrify the process of liquefying that Medical Services Plan (MSP) premiums. With further fair gas. That would mean Site C was primarily about producing tax reform, the costs would be even more fairly distributed. “clean” energy in service of dirty fossil fuels (and it still Relieving BC Hydro of the costs of termination could might be). have been done by transferring Site C’s sunk costs and In the final years of the Clark government, the push to termination costs onto the provincial government’s debt. take Site C “past the point of no return” was, I believe, driv- Or, if the government did not want to assume the $3–4 en by a different but related political imperative. Having billion debt from BC Hydro, it could simply have agreed failed to secure foreign investment for a new LNG industry to annually transfer the interest costs of that debt to BC (and the associated promise of thousands of jobs for B.C.’s Hydro (as restitution for this politically imposed cost). northern regions), our former premier, ironically, beat a Would taking on $3–4 billion in termination debt, with path back to the public sector and looked to BC Hydro to no asset to show for it, squeeze out the rest of the govern- deliver those jobs through construction of the Site C dam. ment’s agenda and potentially erode B.C.’s credit rating with the consequence of driving up debt interest costs? This seems highly unlikely. Economic rationale doesn’t hold water At today’s interest rates, $4 billion in debt would result Premier Horgan appeared notably unenthusiastic when in additional interest costs of at most $150 million a year. he made the announcement that the government would That’s not insignificant. But neither is it enough to derail proceed with Site C. Make that downright miserable. He a government’s agenda: $150 million is less than the cur- made it clear that Site C was, at its outset, a wrong-headed rent surplus, and represents about 0.3% of the province’s policy choice, not a project his government would have $50-billion annual budget. started. But with $2 billion spent, and reclamation costs In contrast, consider that in the September 2017 mi- of termination pegged at $1–2 billion more (likely the low ni-budget the new government cut MSP premiums by 50% end), the premier felt his government had “no choice” but and chose not to replace those revenues with progressive to proceed. tax increases (as the CCPA has previously recommended). Granted, the prospect of spending $3–4 billion and having In doing so, the government chose to walk away from $1.2 nothing to show for it hurts. But the government went billion in annual revenues—a much more costly decision further, stating that absorbing such a bill would put its it did not feel put the rest of its agenda at risk. progressive economic and social agenda at risk. Some Similarly, as Green Party leader Andrew Weaver has ministers expressed the view that termination costs would noted, the government chose to cancel tolls on the Port threaten B.C.’s AAA credit rating and would consequently Mann Bridge and take on that debt at a price of $3.5 billion drive up our debt service costs. (and annual costs of replacing the toll revenues of about Minister Mungall, in an email to those who wrote to her $150 million), but expressed little concern about the impact about Site C, stated: “To do anything but move forward this would have on the affordability of B.C.’s debt. would require British Columbians to take on $4 billion The September mini-budget estimated that taking on the in debt that would have to result in massive cuts to the Port Mann Bridge debt would increase B.C.’s debt-to-GDP services people count on us to deliver. After witnessing ratio (the size of the provincial debt compared to the size the legacy of BC Liberal cuts, I can’t allow that to happen of the economy) by about 1.2 percentage points. The cost of again.” terminating Site C would have been similar in debt-to-GDP This line of argument may sound compelling. But on closer inspection, it is not at all convincing. Had the costs of termination remained on BC Hydro’s books, this would indeed have resulted in an increase in hydro rates, but not to the degree stated by the government. And proceeding with Site C will also result in increases in hydro rates down the road (quite possibly bigger ones). Given that the decision to green-light Site C was politi- cally driven by the previous government, my view is that Unpacking this decision the costs of terminating the project should not have been borne by BC Hydro, but rather by the provincial govern- matters—so we can consider ment as a whole (as it seems the government considered). how progressives might Some may say this makes no difference; taxpayers and ratepayers are one and the same after all. But it does make shake up how future a difference. decisions are made. 29 terms—an impact that is entirely It is a curse of as many jobs as Site C will provide, manageable in economic terms and but more helpfully spread across the well within B.C.’s recent debt levels. modern social province and closer to where people Would taking on this debt have democratic actually live, rather than concentrated resulted in a downgrade to B.C.’s in one locale (which will mean having credit rating? Possibly, but not nec- governments to import much of the labour). essarily. B.C.’s fiscal situation would that, on economic Actually, this is exactly what the have remained enviable relative to NDP proposed in its 2015 PowerBC other provinces with respect to both matters especially, plan. Sadly, that plan was short-lived, debt-to-GDP and debt service costs. It they are inclined a lost opportunity to move forward is arguably also possible that credit rat- with far less of a price and much more ing agencies would have given kudos to let others tell to gain. for termination, seeing it as an ex- them what is and pression of fiscal caution that avoided further potential multi-billion-dollar isn’t allowed. What now? cost overruns as are common with In the end, and official explanations such mega-projects, particularly given notwithstanding, Site C was clearly the fact the credit agencies and B.C,’s a political decision, not an economic auditor general have already expressed one. Only time will tell if that political concerns about BC Hydro’s debt load. decision was strategically correct or a Even with a downgrade (if it oc- costly mistake. curred), would B.C. face significantly The government made a calculation, higher interest costs? Again, despite affirmed by recent polls, that the frequent fearmongering on the point, officials—trumped good policy and majority of the public would support this result should not be assumed. UNDRIP. continuation. They likely worried Bond markets don’t respond slavishly The problem, I fear, is that the about the reaction of mainstream to credit rating agency assessments. full scope of options gets lost at the media pundits and the corporate And if there were a credit market cabinet table. If one’s deputy minister, sector had they chosen termination. response to a downgrade it would be for example, sounds the debt and/or But the economic and political costs of minimal. credit rating alarm, few politicians proceeding with Site C will haunt the Canadian provincial credit ratings feel comfortable pushing back. Or if government throughout its mandate vary from B.C,’s triple-A high to Prince the government is spooked by a credit and beyond. Edward Island’s single-A low. But as rating agency warning—Finance It seems at this point that the economists Trevor Tombe and Blake Minister Carole James did go visit prospects of an about-face are highly Shaffer note, the practical significance the rating agencies early in the new unlikely. So why bother rehashing of this difference is that long-term government’s mandate—there is the decision? First, it is important to provincial bond interest varies from political fear of a downgrade. challenge unconvincing economic jus- 3.1% in B.C. to 3.5% in the Atlantic It is a curse of modern social demo- tifications—and the fearmongering provinces. They note further that, cratic governments that, on economic of credit rating downgrades—or risk “On average, each notch on the S&P matters especially, they are inclined setting a precedent for more disheart- ratings scale is associated with 0.04 per to let others tell them what is and ening decisions down the road. cent higher yield on a 25-year bond.” isn’t allowed. This dynamic plagues Second, understanding this decision In other words, not much. otherwise progressive people who matters so that the new government lack confidence in economics, and it can be encouraged to approach future is heightened when senior civil serv- decisions differently. Much progress is Letting others call the tune ants remain in place after a change of clearly still needed to truly implement Numerous NDP MLAs have offered government—the same people giving and operationalize UNDRIP in B.C. public explanations of the decision to the same advice as always. policy-making. And this is an oppor- proceed, all stating some variant of: Another way was possible. The tunity to change the frame, to shift we referred the utilities commission government could and should have whose expertise wields authority and report for further analysis to financial taken on the costs of termination to reconsider what priorities win out. experts, and with great regret were (realistically a figure closer to $3 In the last election British Colum- told that, while the actual costs of billion). It could have taken on other bians voted for change. Rather than termination versus completion were energy conservation and renewable deferring to the same accountants similar, the accounting treatment of electricity projects over the coming and ministry officials, this still newish the choices would be very different. years (wind, solar, geothermal, etc.) as government can continue to bring Effectively, the government has needed and in partnership with local in new voices, invite more creative said that accounting practices—as First Nations and the building trades. solutions and engage more fully with interpreted by finance ministry In doing so, it could have created just civil society. M 30 PHOTO BY JASON WOODHEAD (FLICKR CREATIVE COMMONS) COMMENTARY / RITA WONG Restoring peace against the odds

Premier Horgan announced in December To dismiss $2 billion in sunk costs our economy depends on healthy that his government would proceed and the inflated $1.8 billion cost for ecosystems. The government could with the Site C dam, increasing its remediation as money “spent on recognize this by declaring the Peace budget by more than $2 billion nothing,” leaving B.C. without “an Valley a provincial asset or park, worth despite having opposed the project asset,” is to completely ignore the value much more than “nothing.” before. Downplaying the B.C. Utilities of ecosystem services. The Peace’s The good of the province—and the Commission’s findings that Site C was current natural capital is worth billions nation—depends on its actions late, over budget and replaceable by in perpetuity, as the David Suzuki being perceived as honourable, by other options, Horgan implied that the Foundation has shown. B.C. can’t afford demonstrating wise management and interests of “a handful of people” in the to lose more forest after the summer of enacting reconciliation. Unfortunately, Peace Valley weren’t as important as devastating fires; we need such natural the provincial and federal governments’ BC Hydro’s plans. He said that his own buffers and carbon sinks in a time of refusal to honour Treaty 8 and to prevent wife believed “that the values lost were impending climate destabilization, ecosystem destruction leads to mistrust, greater than the values gained,” but he especially with the frequency and systemic violence and ongoing injustice. went against his wife’s values anyway. intensity of extreme weather events on There is a high reputational cost when the rise. Money talks loud, but nature Horgan basically ignored how the last we can’t trust our governments. The bats last. 20% of the free-running Peace River Peace Valley Solidarity Initiative held an is a precious legacy for all Canadians The dam doesn’t benefit B.C.’s 4.5 Accountability Summit in Victoria at the and the world. In addition to the West million citizens in the long term. end of January to address why the trust Moberly and Prophet River First Nations, Horgan’s threat to have to cut social has been broken and what could be done 14 downstream Indigenous nations spending upon dam termination rings to remedy the situation. urged Horgan to cancel the dam. hollow in the wake of the NDP giving As Marc Eliesen points out in the Times UNESCO and the International Union for up billions in revenue from bridge tolls Colonist, “There will be higher hydro rate Conservation of Nature have called for in the Lower Mainland without even a increases in the future by continuing the river’s protection, as well as Amnesty mention of credit ratings or accounting construction than by terminating International, the Sierra Club and the practices. As Green leader Andrew the project today.” Such costs land Yellowstone to Yukon Conservation Weaver pointed out, these are trade-offs hardest on the poor, least able to pay Initiative, among others. The region’s that the NDP has made. Unfortunately, for skyrocketing rates through the farming families understand that they the Greens have not used their influence economy’s boom-and-bust cycles. are guardians for everyone who deserves to terminate the dam either. Horgan to experience and inherit the incredible may argue that financial conventions This article was first published in the Peace Valley intact. excuse this sacrifice of the Peace, but National Observer, January 12, 2018. 31 Feature

BENJAMIN CHRISTENSEN Come together for PHOTO BY MEMPHIS CVB (FLICKR CREATIVE COMMONS) pension justice The history of retirement security in Canada is pro-employer. With a bit of collaboration, the future can be pro-worker.

VER THE PAST three years, work- Sears is not unique. In the media, This is augmented by the reality that place pensions and the security the retailer’s plight has been compared part-time workers, the self-employed of defined benefit (DB) plans to what happened at Nortel 10 years and independent contractors usually Ohave been grabbing headlines. ago. If one digs deeper into history, have no pension coverage, in part Air Canada has underfunded its plan, companies reneging on pensions because Canada’s workplace pension Canada Post has been trying to kill goes far back in time and has been the system was designed to protect only DB benefits for new employees, and catalyst of pension policy stretching full-time workers. As 2016 census data Unifor recently accepted defined con- back to the 1960s, when Ontario im- indicates, full-time employment is tribution (DC) plans for future hires plemented Canada’s first “minimum decreasing (only 48.2% of adults aged at GM. More recently, employees standards” pension legislation. Since 24–54 worked a full-time job for all of and pensioners at Sears will likely then, all provinces (with the exception 2015), intensifying the challenges of lose out on the DB pension they had of Prince Edward Island) and the providing retirement income security been promised for years of loyal em- federal government have put in place for Canada’s labour force. ployment. The problems facing these pension legislation intended to protect To understand why Canada’s private pension plans are not only cases of worker’s retirement income. sector workplace pension system is poor management. Rather, they Yet, given all the rounds of reform failing so many workers, one must point to the structural limitations of that have occurred since the 1960s, interrogate history and the political Canada’s voluntary private pension private sector workers who belong to and economic terms in which this system. a DB pension plan remain vulnerable. system was negotiated. Knowing this 32 history puts into focus the need to re-evaluate this system where, along with the Great Depression, the net worth of if we are to successfully expand pension coverage. many private employers and their pension schemes were destroyed. Consequently, there was little to be offered to the aged. Given the comparatively strong tradition of The birth of workplace pensions publicly provided welfare in continental Europe, national The first employment-based retirement income scheme wage bargaining occurred after the war, institutionalizing in Canada was introduced in 1821 by the Hudson’s Bay labour-market relations that became the basis for organ- Company. In 1870, the federal government introduced a izing mandatory quasi-public social insurance covering all pension plan for civil servants, followed a few years later workers. Subsequently, workplace pension systems became (1874) in the private sector by the Grand Trunk Rail (whose administered through public-private systems. plan covered clerks). In general, workplace pensions devel- In countries such as Canada, the United States and oped alongside the growth of large employers, typically in the United Kingdom, workplace plans became a separate government, railroads, utilities, hospitals, universities and private pillar in a broader public-private retirement income private manufacturing sectors. system. A strong corporate-financial culture dominated From the employers’ perspective, the scale of these conservative business perspectives on the role of govern- industries and bureaucracies required a loyal and dedi- ment. These countries also exited the Second World War cated workforce. Pensions thus served as a mechanism to in a stronger economic position where workplace pension attract and retain quality workers, and as an instrument plans could still be offered to workers. The result was that of personal management. The size and longevity of em- collective bargaining in countries such as Canada was ployment characterizing that time enabled employers to conducted at the company or industry level. make a legitimate promise to workers. Labour movements The need for reliable sources of labour in war industries across Canada and other industrializing countries took led governments in Canada and the United States to es- root and the demand for unionized work environments tablish an institutional framework that would integrate slowly evolved. Workplace pensions for “good service” came unions into capitalist economic expansion through indus- to represent an aspect of the social wage model as part of trial relations legislation and arbitration. worker’s compensation. For example, in 1935, the Wagner Act in the United Before the Second World War, the private pension system States became a foundational statute guaranteeing the (then in its infancy) was not viewed as an enforceable legal basic rights of private sector employees to organize into right. Many workers left their employer before receiving unions, to engage in collective bargaining and to strike. a pension. Coverage rates were low, pension funds were During the Second World War, the National War Labor often mismanaged, and the absence of government pen- Board legislated that employers must negotiate sick leave, sion regulation meant employees and their dependents and that disability wage plans and group insurance must were vulnerable to the whims of paternalist employers. be written into labour management contracts. In 1948, the It was not unusual for employers to use the promise of board concluded that “employers were legally obligated to a company pension as a leveraging tool to control their negotiate pension plans,” thus making pensions a formal workers, threatening to withhold an employee’s pension bargainable issue. if they became involved in labour organizing activities. In Canada, although workers had been granted the As corporate welfarism grew in Canada during the first right to freely associate into trade unions in 1872, follow- half of the 20th century, favourable federal income tax ing the Trade Union Act, in 1944 the Privy Council Order legislation was introduced to make establishing pension 1003, adopted by Wartime Labour Relations Regulations funds more attractive (i.e., the Income War Tax Act of 1917, under the Liberal government of Mackenzie King, forced which was amended in 1928 and 1938). This legislation employers to negotiate with organized workers, including allowed employers to deduct pension plan contributions on workplace pensions. and exempt investment income from their taxes if the employer agreed to place the fund in a trust under separate management. But there still was no common law principle that prohibited an employer from withholding pension entitlements from a member. The golden era of private pensions began after the Second World War and lasted until the 1970s. Full-time employment The labour movement is across industrial sectors, growing unionization and rapid industrial economic expansion characterized a new range currently splintered when of political co-operation as Canada’s welfare state expand- it comes to agitating for ed. To identify the structural problems facing Canada’s workplace pension system today, it is useful to describe the collective pension reform broad forces that have shaped different workplace pension and campaigning for non- systems across Western industrialized societies since then. The destruction wrought by the Second World War was member workers with no most damaging to the economies of continental Europe, benefits. 33 While collective bargaining rights labour movement’s intent of pooling conditions compelled employers to were established, the desire of Cana- risk across a broader group of workers believe they were taking on too much dian and American governments to was terminated by the desire of large of the risk involved with plan adminis- use collective bargaining to mitigate industrial employers to control the tration (what actuaries and employers labour disputes created an opening retirement savings of their workers termed the “asymmetry of risk”). At the for employers to establish corporate and benefit from the tax exemptions. same time, unionization levels were welfare models of industrial relations. Subsequently, private sector decreasing and unemployment was As a result, control over workers’ pension coverage rates shot up dra- growing for men in industrial jobs, economic security became a key bat- matically in Anglo-Saxon countries allowing more employers to diminish tleground for control of the economy such as Canada, the United States pension benefits with less resistance and class power. and the United Kingdom, expanding from workers. These conditions led, in Initially, many unions had lobbied coverage from around only 15% the 1990s, to a critical period in which for universal security for the elderly in during the 1930s to over 40% by the employers exited en masse from the the shape of national or industrywide 1960s. In Canada, the 1970s was the provision of retirement security in the workplace pensions, but found them- pinnacle of pension coverage in the form of the DB pension plan. selves reluctantly negotiating private private sector, reaching over 50% for The trend continues today. Virtually pension schemes with single employ- male workers, many of whom worked no new private sector DB plans have ers through collective bargaining. for large industrial companies in been established since the 1990s, and Governments were unwilling to step manufacturing. existing plans continue to be under- in to labour disputes beyond setting This cemented the key function funded and replaced by less secure out basic parameters of collective of workplace pensions as a central pension schemes such as DC and tar- bargaining. pillar in retirement income systems, get-benefit plans. Even public sector By offering new benefits and keep- in contrast to the mandatory social in- DB plans, which typically are viewed ing unions out of the administration surance arrangements in continental as more secure, have come under of employment benefits, along with Europe. It is here that one can locate threat in recent years, as experienced demanding collective bargaining occur how the risk of saving for retirement at Canada Post and by public sector at the local or plant level, employers has been historically institutionalized workers in New Brunswick. were able win advantage over many between workers and employers. The workplace pension system de- unions. Consequently, employers signed in the 1950s and 1960s was only could now dictate the structure of feasible in the long term if economic Canada’s private pension system, in The long decline and conditions remained the same. But which the risk of providing retirement the future of pension coverage economic conditions have changed. security was voluntarily assumed by The peak of pension coverage in the Given that workplace pension policy the employer as long as favourable 1970s was short-lived and began to was designed to fill the holes left in a economic conditions prevailed. diminish into the 1980s as corporate system that was created by siding with In hindsight, while the power of restructuring integrated Canada’s employers in the early postwar years, labour did substantially grow, along economy into global markets, often it is not surprising that this system is with increasing wages and social by way of plant closures, unhinging now deteriorating. Secure DB pension benefits for workers, unions were not the postwar industrial employment plans are being left to sink, forcing able to secure control over retirement relationship. workers to worry about the risk of income security. By the late 1950s, Growing regulatory and account- losing their pension income. governments began to develop public ing standards, unfavourable court So what is to be done? How can we policy that served to fill the holes left rulings and deteriorating economic protect current pensions from the fate in private social policy, ultimately faced by workers at Sears? And how siding with the interests of employ- can we expand workplace pensions to er-sponsored welfare capitalism. The workers with low coverage, particu- design of the Canada/Quebec Pension larly the self-employed and part-time Plans (C/QPP) and Ontario’s Pensions workers in low-paying jobs? Benefit Act during the mid-1960s re- There are some new policy inno- flected the acceptance by government vations and services that are worth of the role employers would play in highlighting. In Canada, Common Canada’s retirement income system. Wealth, a Toronto-based firm that In the absence of a universal pension Only 48.2% of provides pension plan recordkeeping plan that offered full coverage, unions and administrator services, is assisting increasingly accepted and negotiated adults aged labour and professional associations for beefed up workplace pension plans 24–54 worked establish quality multi-employer pen- through the end of the 1950s and sion plans for part-time and low- to 1960s. This pivotal period reflected a full-time job for middle-income workers. For example, a victory for capital, in which the all of 2015. in 2017, Common Wealth launched a 34 retirement plan for lower- and moderate-income Canadians By offering new benefits in partnership with the Service Employees International Union (SEIU), targeting part-time frontline health care and keeping unions out workers. of the administration of New policies are being legislated south of the border, too, with the intent of expanding pension coverage for employment benefits, along employees of small businesses. The state governments of with demanding collective California, Oregon, Illinois and New Jersey are proceed- ing with “auto-IRAs” that automatically enrol employees bargaining occur at the local in individual retirement accounts through paycheque or plant level, employers deductions. These programs are administered through financial service companies and overseen the by the state were able win advantage government. over many unions. While these ideas have the potential to increase retire- ment income security for some, the fact remains that pension coverage continues to decrease. The majority of working Canadians today have no workplace pension coverage to speak of. To meaningfully expand coverage to more sectors in the labour force, Canada’s labour movement must play a leading role and collectively advocate for all reform and campaigning for non-member workers with workers, particularly the precariously employed. This will no benefits. require new organizing strategies that cross jurisdictional One hurdle that must be overcome is Canada’s collective and sectional boundaries in Canada’s economy. bargaining system that atomizes unions into negotiating One recent victory occurred when the federal Liberal at the company or local level. Campaigning for pension government expanded the CPP in 2016 from covering 25% to expansion is often high up on the to-do list as individual 33% of preretirement earnings. While a significant change, unions face a multitude of pending issues on a regular it still fell short of the 50% coverage that the Canadian basis. When time is given to the pension file, unions spend Labour Congress (CLC) has been fighting for since the their resources protecting already existing benefits for 1970s. It means middle-income workers will still need other their membership, either against aggressive employers sources of retirement income besides CPP. Beyond this at the bargaining table or against legislative threats that CLC-led campaign, there are no other significant organizing seek to dismantle the hard-fought-for pension benefits efforts across Canada’s labour movement with the goal of discussed above. This limits a union’s available resources expanding pension coverage. for organizing new campaigns collectively across Canada’s Instead, campaigns occur at the provincial or federal labour market. levels, typically targeting a specific piece of legislation. For The time is right for a national discussion, like the ones example, at the federal level several unions and grassroots that took place during the “Great Pension Debate” of the groups such as the Ottawa Committee for Pension Security 1970s, to address the existing voluntary pension system are campaigning against Bill C-27, legislation that would that is simply not providing adequate retirement income establish a target-benefit plan in federally regulated work- security for Canadian workers. Employers are walking places. In New Brunswick, Pension Coalition NB, a lobby away from the pension system that they shaped in their organization representing 13,000 public sector pensioners, own interests generations ago. Current labour campaigns is suing the provincial government over the introduction and the pension innovations mentioned above offer band- of legislation that retroactively changed DB pension en- aid solutions to a structural problem that is worsening. It titlements into a target-benefit pension plan. is hard to imagine workplace pension coverage expanding On the other side of the country, the Alberta Federa- within the current system. tion of Labour is leading a campaign to introduce a joint While there may be some bright spots for pensions worker-employer trustee governance model for public among public sector workers in places such British Co- sector workers to better protect existing DB plans. And lumbia and Ontario, threats remain on the horizon, with in Manitoba the provincial government has recently legislative attacks such as Bill C-27 that aim to transform launched a consultation process on a new funding regime secure DB plans and shift the risk of saving for retirement to convert existing DB plans to target-benefit, generating onto employees. The power of traditional DB plans is that a new showdown between public sector unions and the members are required to contribute earnings to the plan, government. and these earnings are pooled, generating more secure These battles are notable and must be fought vigorous- retirement income. To expand pensions coverage to all ly. However, they are geared to protect already existing workers in the Canadian economy, the labour movement, benefits, and are fought separately in the absence of a retirees, concerned workers with a good pension plan and cohesive national movement, reflecting the need for a those without, must band together at a national level to new collective strategy. Presently, the labour movement is demand a larger role for Canada’s public pension system splintered when it comes to agitating for collective pension as the best remedy to expand coverage for all workers. M 35 Feature

ASAD ISMI Careful what you wish for Canadian business wants a notch in China’s Belt and Road Initiative. In Asia, as in Canada, there are domestic and foreign policy risks to consider.

N MID-JANUARY, AT a forum in Shang- But not everyone is so enthusiastic. An estimated 18,000 Balochis have hai, the Chinese government There is major opposition to the BRI been forcibly disappeared by the presented the latest additions to its in Pakistan’s Balochistan province, Pakistani army. Naela Quadri Baloch, Iglobal economic strategy known as where ethnic Balochis are fighting president of the World Baloch Wom- the Belt and Road Initiative (BRI), the a separatist insurgency against a en’s Forum, accuses the army of “using largest infrastructure project in the Pakistani army accused of massive rape as a tool of oppression,” and world. The BRI consists of economic human rights violations. Balochistan blames increased violence by the Pa- corridors—roads, pipelines and mari- is in fact crucial to the creation of the kistani state on Beijing’s interference. time links—connecting Asia with the CPEC, which in turn is a major part “China is looting the resources of our Middle East, North Africa and Europe. of the BRI. province, including the gold reserves, Chinese spending on BRI infrastruc- Gwadar Port in Balochistan, a and turning a blind eye to the genocide ture projects, including mines, ports BRI-funded project, will give China of the Baloch,” she told The Indian Ex- and other mega-projects at home and an important alternate route for oil press in April 2016, adding that many in countries along each corridor, could imports from the Middle East. Paki- new roads for the CPEC were being reach $8 trillion over the next 20 years; stan and China are also building road destroyed by Balochi insurgents. $300 billion had already been spent by and rail networks between Gwadar October 2017. and Xinjiang, China’s largest province alochistan should be a cau- With this massive investment China bordering Pakistan. “If [the BRI] is like tionary tale for Canada, whose is “quietly reshaping the world,” in the a symphony involving and benefiting Bparticipation in the BRI is being words of Atlantic Monthly, in particu- every country, then construction of encouraged by Beijing and domestic lar the lives of its closest neighbours. the [CPEC] is the sweet melody of the corporate lobby groups. Not only The BRI, which was launched in 2013, symphony’s first movement,” said could Canadian companies vying for has so far funded a China-Pakistan Minister Wang in 2015. BRI funding get pulled into potential Economic Corridor (CPEC) passing Balochistan comprises 43% of human rights disasters abroad, but through the latter’s Balochistan prov- Pakistan’s land area and holds most there are possible concerns related ince, a new military base in Djibouti of its natural resources, including a to Chinese government influence in in the Horn of Africa, which opened rich supply of oil, natural gas, coal, Canada as well. in August last year, a high-speed copper, gold, silver, platinum, alumi- “China’s economic strategy has China-Thailand railway line, and col- num and uranium. Yet the Balochis, grown to include much of the world,” laborative projects with 16 East and who represent 3.38% of Pakistan’s says Gordon Houlden, director of the Central European countries. population, have long been oppressed China Institute at the University of Chinese Foreign Minister Wang Yi by the country’s army, and 63% live Alberta. “With so much money being announced in December that there below the poverty line. Natural gas spent by China, there are opportunities were Belt and Road co-operation from Balochistan produces 40% of the for Canadian companies to participate agreements with 80 countries and country’s primary energy, but only 6% in BRI infrastructure projects, as some organizations, and that China had of Balochis receive it and the province of them have substantial engineering built 75 overseas economic and trade only gets 12.4% of gas royalties. capabilities.” co-operation zones in 24 countries. Given such deprivation, it is not Canadian companies such as With so much money on the table, surprising there have been five Ba- Montreal’s Bombardier and Calgary’s even rich countries are angling for a loch insurgencies against the central Grand Power Logistics Group are piece of the BRI action. The British government since 1948, the latest one already tapping into the BRI by government, for example, has declared starting in 2005. Balochi insurgents investing in Turkey’s high-speed rail the U.K. “a natural partner” for China, and nationalists have called on line and a rail service in China. But and the German government claims China to stop the construction of overall, Canadian participation in the country’s private sector is “willing the CPEC until the province becomes the Chinese infrastructure vision is to support BRI.” independent. not yet extensive. 36 “With a few exceptions, our busi- dependent for 75% of our trade on agreement undermined its control ness community is behind the curve the U.S. market—I’d like to see that over resources in its territory and that in terms of taking advantage of Belt number go down to 50%. The sheer the government had failed to consult and Road opportunities,” writes Eva size of the Chinese economy and the with the First Nation as it was legally Busza, vice-president of research at rate at which it is growing makes it a required to do. The Hupacasath lost the Asia Pacific Foundation of Canada, very attractive trade partner. Having the case, which the judge decided to a corporate and government-funded a range of trading partners will give be based on speculation, ignoring com- think tank that promotes closer Cana- Canada greater economic stability.” pletely the NAFTA and international da-Asia relations, in a recent blog post. ISDS record of companies running In a business survey released by the he Canadian Centre for Policy roughshod over democratic decisions. Canada-China Business Council in Alternatives (publisher of the The Trudeau government has sig- April 2017, 74% of respondents knew TMonitor) agrees with Houlden on nalled it will be more welcoming to about the BRI and 44% saw opportu- one point—that it is important for Chinese investment than the Harper nities for themselves in it. Canada to deepen economic, political government. Since taking office, it has In Canada, many business groups and cultural ties with China. But, as approved the sale of high-tech firms see a free trade agreement with China Senior Researcher Scott Sinclair adds Norsat and ITF Technologies to Chinese as a way to quickly increase profit- in the CCPA’s submission to the federal buyers, even though both companies making opportunities in Asia, and the government on a possible China FTA, manufacture “military-edge” technol- initiative has been taken up enthusi- pursuing this goal through a standard ogy. The ITF sale approval essentially astically by the Trudeau government. free trade deal “creates unacceptable reversed official Canadian policy. Can- “There is an opaqueness to the Chinese risks for Canada, and particularly for ada blocked the deal in 2015 after the economy,” claims Houlden. A free trade Canadian workers.” Department of National Defence deal “could act a cudgel to break down Sinclair warns that a CCFTA will warned “China would be able to do- barriers to investment and trade.” In reinforce Canada’s high trade deficits mestically produce advanced military return, China will expect “loosened with China (which increased from laser technology to Western standards investment rules” in Canada, he tells $8.5 billion in 2001 to more than $43 sooner than would otherwise be the me, including a lighter touch when it billion in 2016), further erode Canada’s case, which diminishes Canadian and comes to foreign takeovers. manufacturing base, intensify compe- allied military advantages.” Canada’s Investment Act allows tition with lower-waged and poorly The Trudeau government is now the federal government to apply a protected Chinese workers, and likely reviewing the sale of Aecon, one of national-interest or “net benefit” worsen domestic inequality. Canada’s largest construction group, screen on foreign takeovers above $1 “China is a superpower,” he writes. to CCCI, an overseas financing arm of billion, though it is rarely used—a sign “However painstaking Canada’s the China Communications Construc- of Canada being “open to business,” negotiating strategy or skilled its tion Company. Canada’s domestic as espoused by successive federal negotiators, due to the vast power construction industry opposes the governments. Chinese state-owned imbalance between the two parties, takeover—for fears of undue Chinese enterprises, however, face additional China will ultimately be the rule-mak- government influence and the poten- screens, first introduced by the Harper er and Canada the rule-taker in any tial to suppress prices—though Aecon government in 2007, when investing in one-on-one FTA negotiation.” shareholders have already voted their Canadian energy and infrastructure. This was, after all, the experience in support. CCCI has been previously The majority of Chinese investment negotiating the Canada-China Foreign delisted by the World Bank for fraud- in Canada is in the energy sector and Investment Promotion and Protection ulent activities in the Philippines, and in mines and minerals, and Beijing Agreement (FIPA), signed by the is criticized for recent worker deaths will undoubtedly seek a relaxation or Harper government in 2012. The FIPA, in Guangzhou and Dongguan. elimination of “net benefit” screens which protects Chinese investment in A free trade deal with China, like the in these areas under any FTA. The Canada to a much greater extent than FIPA before it, would arguably make second Chinese priority is an oil Canadian investment there, includes it more difficult to hold Chinese firms pipeline in Canada that would take a controversial investor-state dispute accountable for their actions in Cana- tar sands bitumen to the West Coast settlement (ISDS) mechanism. Under da. Sinclair recommends instead that for shipment to Asian markets. The NAFTA’s ISDS process, Canada has Canada should consider “a sectoral Trans Mountain pipeline expansion been sued more times than either approach focused on. developing approved by the Trudeau government Mexico and the U.S., frequently by U.S. ambitious strategies to co-operate in aims to accomplish this but faces legal companies whose resource projects achieving both countries’ urgently challenges in B.C. were frustrated by public interest needed transition to renewable en- “Since NAFTA looks like a train regulation or community opposition. ergy,” an area where China has made wreck, it is very important for Can- The Hupacasath First Nation, based great progress. “A successful co-opera- ada, whose prosperity is based on in Port Alberni, B.C., sued the govern- tive model in renewable energy could trade, to look for diversification in ment in federal court in 2013 over the be built on and extended to other this area,” argues Houlden. “We’re Canada-China FIPA, arguing that the sectors.” M 37 low-emission bus zones butterfly, the high brown and fees for dirtier cars. fritillary (pictured). California Governor Jerry Conservationists believe Brown has launched a 50 years of climate change $2.5-billion plan to get and the abandonment of five million zero-emission coppicing have contributed cars on the road by 2030 to the steep decline of the and expand a system large, powerful, fast-flying of charging stations to butterfly. / Agence The good service them. The money France-Presse / EcoWatch will come from the state’s / Guardian (U.K.) news page cap-and-trade system, as before they are plunged well as existing programs into boiling water to cook, Compiled by at the California Energy and transporting live Writing wrongs Elaine Hughes Commission. / Euractiv / marine crustaceans on Reuters / EcoWatch / BBC ice or in icy water will no anada will formally News / Associated Press longer be permitted. The Cexonerate Chief Climate and energy overhaul of Swiss animal Poundmaker, a legendary protection laws also aims First Nations Cree chief weden now tops a chart City matters to crack down on illegal who was convicted of Sof 11 European Union puppy farms and imports, treason in 1885 after being countries that have already n early January, and ban devices that wrongly accused of pro- met their 2020 renewable IPortland, Maine council automatically punish dogs voking a bloody battle with energy goals, two years unanimously passed a when they bark. Norway Canadian soldiers. Former ahead of schedule. The tough ban on synthetic will ban all fur farming chief of the Poundmaker Scandinavian country pesticide use, earning the by 2025 in response to Cree Nation, Blaine Favel, derives 53.8% of its energy city an “organic” status. The a 2014 document on the and other members of from solar, wind, biomass ordinance, which becomes country’s 300 fur farms the Saskatchewan First or hydropower, followed effective on July 1, 2019, is produced by People for Nation have been asking by Finland (38.7%) and one of the strongest pes- the Ethical Treatment of for this from Ottawa for Latvia (37.2%), with the ticide reduction policies Animals (PETA). In an effort decades. Two Middle Netherlands, France and in the United States, with to combat overfishing Eastern filmmakers made Ireland furthest away from fines ranging from $100 and plastic pollution, the history when they received meeting their country to $500 for violators. A Greenpeace ship Arctic Oscar nominations—the targets. French President Detroit at Work training Sunrise is on a three-month first for their respective Emmanuel Macron did, program, put in place by Antarctic expedition to countries—for best however, announce the city in February 2017, help further the joint EU foreign language film his country would shut has trained and graduated and Greenpeace case (Ziad Doueiri’s Lebanese down all its coal-fired 500 residents, most of for a massive ocean drama The Insult) and plants by 2021, along with them into full-time jobs in sanctuary five times the best documentary (Syrian Denmark, Finland, Italy, health care, information size of Germany in the Firas Fayyad’s Last Men the Netherlands, Portugal technology, construction, Weddell Sea and around in Aleppo). Speaking of and the U.K. According transportation, retail, hos- the Antarctic Peninsula. insults, as part of his new to Adnan Amin, director pitality and manufacturing. The 1.8-million-square-kilo- antiquities trafficking general of the International At 9.6% in September, metre sanctuary would unit, Manhattan District Renewable Energy Detroit’s jobless rate is stop industrial-scale krill Attorney Cyrus Vance Jr. Agency (IRENA), solar and nearly half what it was in fishing and create “an recently returned three wind power will soon be January 2014. / Pesticide urgently needed safe zone” ancient sculptures, dating “consistently cheaper” Action Network / Detroit for creatures like penguins, from the 4th and 6th than electricity from fossil News whales and seals that centuries and valued at fuels, which will be a boon call the area home. The more than $5 million U.S., for communities the world U.K.’s People’s Postcode to their rightful owners in over that were never Flora and fauna Lottery has donated Lebanon. / Globe and Mail / connected to centralized £100,000 ($175,000) to the Reuters / CBC News power grids. London Mayor s of March 1, lobsters National Trust to improve Sadiq Khan attributed the Ain Switzerland must 150 acres of land north of British capital’s cleanest be stunned (by electric the Devon coast to serve mid-January air in 10 years shock) or have their brains as a safe habitat for the to the introduction of mechanically destroyed country’s most endangered 38 SUPPORTER PROFILE Meet Kevin Morris

The Monitor periodically gets to know CCPA supporters. In this issue we speak to Manitoban Kevin Morris.

Hi Kevin, read any good books lately? No books, but I have been getting into a very thought- ful personal finance blog/podcast called “A Wealth of Common Sense” (www.awealthofcommonsense.com). It’s written by a wealth manager in the United States and speaks about the different cognitive biases investors go through and how society has reacted over the past century to different market crashes and bubbles. I’ve been meaning to read BRICS: An Anticapitalist Critique, by Ana Garcia and Patrick Bond et al. Tell us about someone who was a big influence on you and your political thinking. In my late teens and early twenties I was heavily influenced by the heterodox economics and history professors in the global political economics program at the University of Manitoba: Henry Heller, Mark Hudson, Ian Hudson, Robert Chernomas, John Serieux, Rod Keuneman and Jean-Luc Chodkiewicz, among others. I was on a trajectory toward blissful ignorance until they introduced me to reports by the CCPA and Le Monde Diplomatique. Why did you decide to become a supporter of the CCPA? I recently began donating to the CCPA as a monthly supporter as I started gainful employment. I feel that sup- Name one policy alternative that would make people’s porting economists and accessible research that provides lives better today. evidence in support of people is important, especially when self-interested wealthy individuals are able to give I think this is an emerging issue, but in light of boondog- so much more to their think-tanks. I was donating for gles such as the Phoenix pay system, data leaks, and the almost a year and then doubled my monthly donation high cost companies and governments pay for software, I when the CCPA started calling out the Fraser Institute’s would like to see more adoption of open-source software garbage analysis on taxation. in the government. It really impressed me that the CCPA would refute bad For a few years now, the Open Source Observatory has analysis on top of promoting its own. I think the CCPA is been following the adoption of open-source software in special because it’s one of the few Canadian organizations European Union governments, and its use has significantly that funds heterodox economists outside of universities, improved government efficiency. My hope is that the which are becoming more profit-oriented lately. The CCPA Canadian government will adopt a similar policy for open- also doesn’t phone it in. I can’t remember the last time I source use (where relevant) in the near future. “Public read a shoddy analysis by a CCPA staffer. Money, Public Code,” as the saying goes.

The CCPA is grateful to those supporters who have switched to monthly giving or are considering it in the future. We would appreciate the chance to provide information about the benefits of monthly giving—please contact Katie Loftus, Monthly and Legacy Giving, at 1-613-563-1341 ext. 318 (toll free: 1-844-563-1341 ext. 318) or [email protected]. 39 Chicago public school system will soon make computer science a high school graduation requirement. Supposedly, this emphasis will prepare students for WORK LIFE high-paying tech jobs and open the door for the next Steve Jobs or Jeff Bezos. But Tarnoff offers a more plausible scenario: LYNNE FERNANDEZ “At its root, the campaign for code education isn’t about giving the next generation a shot at earning the salary of a Facebook engineer. It’s about ensuring those salaries no longer exist, Today’s coders, by creating a source of cheap labour for the tech industry.” It’s simple: high wages eat into profits. In fact, tech tomorrow’s precariat wages, although still high, have stagnated since the 1990s. Tarnoff claims that this stagnation is the result of collusion between the tech companies to prevent employees from switching jobs and bargaining up their wages. The industry also imports skilled and exploitable guest workers from ESPITE BEING BETTER educated than previous gen- low-wage countries, paying them much less than American erations, there are fewer decent jobs for younger or Canadian workers. workers, even after they have paid their dues working It is increasingly clear that the generations behind the entry-level jobs or unpaid internships. They’re taking boomers have fewer and fewer job options. As the CCPA’s on considerable student debt only to find a fractured new report No Temporary Solution shows, the post-sec- Dlabour market that denies them access to full-time jobs ondary sector is now heavily reliant on part-time, low-pay with decent pay and benefits. And it doesn’t seem to matter contract work, a growing trend throughout the public sector. which sector of the labour market they turn to. With almost no secure jobs in the non-profit sector, and The non-profit sector relies on those who are willing fewer and fewer in the public and private sectors, where can to work for relatively low wages, few if any benefits and younger generations turn for decent work? Even if coding contracts tied to unstable funding. Many workers are remains a useful skill into the future—it’s hard to tell with between the ages of 23 and 35, and others have spent most things changing so fast—it will not protect workers from of their working lives in the sector, often moving from one the proclivity of employers to lower wages. One way or an- job to another. They work long hours at women’s centres, homeless shelters, co-ops and recycling centres. Others work with marginalized Indigenous and newcomer youth, and people struggling with addictions. Even tech wages, although The majority of these workers have a bachelor’s degree still high, have stagnated and many have a master’s. They are analytical, articulate, strategic thinkers who feel as comfortable lobbying a since the 1990s. cabinet minister as they do on the street. They can work all the social media tools, understand local politics, have business smarts, have built extensive networks and work other, today’s coders are tomorrow’s marginalized workers. collaboratively. But they may not have jobs next year or It doesn’t have to be this way. In the private sector, next month, they cannot afford to save for retirement, can’t government needs to increase the minimum wage, better afford to buy a house, and are putting off starting a family. accommodate unionization, improve employment stand- From a moral perspective, and in terms of reducing ards and tax corporations that don’t invest in job-creating government costs for social services, the work these young strategies. people do is so important. Why does society undervalue Government should also be providing long-term and their contributions? The easy answer is that they work in increased funding for the non-profit sector so that its the non-profit sector: no profit, no glory. dedicated workers are adequately compensated. And by But in today’s for-profit world there are no guarantees. increasing public spending in the green economy, health As Canada’s economy continues its long transition from care and education—including in foundational fields manufacturing to the service sector, the labour market has (math, science, language skills, civics and history) that fewer good jobs and many precarious ones. Of increasing will always be needed—all generations of Canadians could concern are the growing gig economy, robotics and de- have decent jobs and access to necessary public services. clining unionization. This is the world Canada’s younger The rapid deterioration of the labour market reminds generations find themselves in. Inevitably, even promising us that corporations will not voluntarily create good jobs sectors like tech may eventually dry up for young workers. in perpetuity. It’s up to government to ensure that today’s The high-tech sector has convinced educators to adapt young workers, and those in generations to come, are not school curricula to its needs. Coding is the flavour of the squeezed out of decent work. M day, with experts calling it an “essential skill” for children’s LYNNE FERNANDEZ IS THE ERROL BLACK CHAIR IN LABOUR ISSUES WITH THE future success. According to the Guardian’s (U.K.) Ben CCPA-MANITOBA. YOU CAN REACH HER AT [email protected] AND FOLLOW HER ON TWITTER @LYNNEFERNANDEZ. Tarnoff, 40% of American schools now teach coding. The 40 Books

REVIEW ESSAY BY MICHELLE WEINROTH Annexation, incarceration and “the bureaucracy of evil”

THE BIGGEST PRISON ON EARTH: would soon burst: a fusion of joy and A HISTORY OF THE OCCUPIED deep distress, a cathartic release of TERRITORIES anguish over lost ideals, had arrested ILAN PAPPE his pulse. The dance had reignited for one fleeting instant his political One World Publications, June 2017, $43.50 fantasy, but also the recognition of tremendous loss and the approach of Reaction to my previous review of Israel’s dark future. Ilan Pappe’s Ten Myths about Israel His brusque departure left me with (“A handbook for a just peace in the many unanswered questions. But the Middle East,” September/October words he spoke 50 years ago about 2017) has been polarized. While some the one-eyed king, the man with the Monitor readers lauded it, others re- patch, were not difficult to parse. If he sponded angrily, finding it difficult to was not the John Wayne of True Grit confront Pappe’s critique of the Israeli (1969), this ruler was unmistakably state and the myths on which Zionism Moshe Dayan, the John Wayne of the was built. I am aware that his book West Bank, the Gaza Strip and East and my sympathetic review would be him to teach soldiers about the merits Jerusalem. very unsettling to those who have a of war. He cringes at the prospect. A Dayan, glorified military command- longstanding attachment to Israel. I historian of pre–First World War pac- er and Israel’s defence minister during recognize their discomfort. However, ifism, he abjures the mere thought of the June 1967 war, was as much a gun- in 2018, with the relocation of the adulating military aggression and de- slinger in Knesset cabinet meetings as U.S. embassy in Jerusalem, with the clines the offer. Seeing the writing on he was in the field. Not long after the incarceration of the 16-year-old Ahed the wall, he quotes a line from ancient June victory, when ministers discussed Tamimi, iconic symbol of Israel’s abuse scripture: “In the land of the blind, the at length the future management of of Palestinian youth, with Gaza’s one-eyed man is King.” the newly conquered territories and, unprecedented humanitarian crisis, He mutters these words with bitter- most crucially, what to do with the 1.5 caused by a 12-year Israeli blockade, ness, having sacrificed 20 years of his million people living there, Dayan’s and so much more, there is ample life to the building of a just society in insouciance allowed him to run reason and factual evidence to justify Israel, only to see his political dream roughshod over the uneasy conscience a harsh critique of the Israeli state. evaporate and his Zionist beliefs of his colleagues. He hectored his wa- Pappe’s Ten Myths about Israel and shattered. The progressive world vering peers when the ghost of 1948 his most recent work, The Biggest he sought to build in Palestine had (i.e., the Zionist expulsion of 800,000 Prison on Earth, which I review here, become a nightmare with no end in Palestinians, known as the Nakba) are essential texts for understanding sight. In retrospect, I imagine that his reared its head. His confident retorts the lead-up to the ever-worsening despair, which he suppressed and sub- squelched their slightest qualm. Un- crisis we are witnessing today in limated into ceaseless work, weighed apologetic about the idea of “transfer,” Israel-Palestine. heavily on his chest. or a military occupation that would My father died suddenly (age 46) span 50 years, Dayan played a pivotal HE YEAR IS 1968. After four years at a New Year’s Eve party, having role in sealing the fate of countless abroad, my father returns with eagerly joined our guests in a cele- Palestinians. his family to Israel. A Cambridge brative Israeli folk-dance. Mayim, PhD in hand, he is poised on an Mayim, the life-giving water dance lan Pappe’s latest book, The Biggest academic career. Within a few was, ironically, my father’s last fling Prison on Earth, demonstrates with Tmonths, the Hebrew University invites on earth. His already damaged heart Isubstantive proof what my father 41 could only suggestively foretell in his To retain the territories in perpe- of [Palestinian] movement; it also had cryptic reference to the iconic gener- tuity, these men—of every political the power to rob anyone it wished of al. What we get here is a systematic stripe—convened to justify, normalize the right to work, to study, to build and account of the Israeli occupation of and entrench an institution of sheer to trade. Any such elementary activ- Palestine, its genesis, unfolding and in- cruelty. Invoking euphemisms and ity required a permit that would be tensification from 1963 to the present, casuistic rules, they spoke and acted withheld or denied.” Beyond a system along with the actors (military per- with a sense of prerogative and enti- of permits, the occupation also arbi- sonnel, legal staff, academics, officials tlement to “biblical” lands like Judea trarily imposed blockades, justifying from the Ministry of the Interior) who and Samaria (alias the West Bank), closures to “tighten supervision” and made (and make) it possible. Holding and the holy sites of Jerusalem. In to “roundup people, ‘suspects’ as the it all together is Pappe’s versatile effect, this gathering of men worked Israelis call them…. Such actions were metaphor of the military occupation out a solution to a conundrum that usually conducted with violence, leav- as mega-prison—an acknowledgment had dogged Zionists from the late ing a scene of havoc and destruction in that where international law deems 19th century: how to rid their coveted the homes visited. The members of the occupation to be the temporary Greater Israel of its Arab demographic household were beaten, abused and custody of an occupied people, the while preserving the allure of moral their furniture destroyed.” bleak reality is that Israel treats the rectitude in the eyes of the interna- The occupation was a method of occupied inhabitants of Palestine as tional community. social control hinging on punishments inmates, to be denied all civic and It was a public relations challenge and meagre rewards (i.e., some basic human rights. that entailed squaring the circle. They civil and human rights). But these If at first the book reads as a thus studiously devised the tactics scant allowances were contingent straightforward chronological narra- that would obscure both their ulti- on utter subservience. At any time, tive, punctuated by a series of salient mate objective—annexation—and if Palestinians resisted they could be episodes—the 1967 expulsion of Arabs its violent means: the incarceration stripped of these fundamental rights. from the Old City of Jerusalem, the and humiliation of the indigenous With this carrot-and-stick approach depopulation of countless Palestinian inhabitants. Here Dayan features as the system guaranteed its built-in villages (among them Beit Nuba, Yalo the one-eyed king amid the blind— permanence. Over time, it proved and Imwas, whereupon Canada Park men who covered their eyes as they to be a windowless prison; its exits was built), the two Intifadas, the Oslo hatched a plan to condemn millions were merely revolving doors, and no Process and the dismal fate of the of innocent people to a life of hell. In amount of perks for “good behaviour” Gaza Strip—it is also a schematiza- the collaborative energy of Knesset guaranteed Palestinians a release into tion of the prison’s operating system, discussions was thus born what Pappe veritable freedom and human dignity. with each chapter illuminating a calls “the bureaucracy of evil.” Political rights for the inmates, accord- crucial mechanism in that apparatus. “There are very few evil people in ing to the Zionist view, would simply The book is not only the historian’s modern human history but there are “threaten Israel’s existence”—its 80% delineation of political time, but quite a few evil systems,” clarifies Jewish majority. his depiction of repressive political the author in his introduction. “The Since its inception in 1967, the occu- space—the enclosure of Palestinians mega-prison of Palestine is one of pation has not fundamentally changed, within a grid of degradation. them. The villains of…this book are it has only become more intense and The Biggest Prison “does not seek to therefore the Israelis who worked out more entrenched. “Movement within demonize Israeli society as a whole.” the fine detail of the system to begin the West Bank is…severely restricted. Rather it yields a psychological por- with, those who upheld it for all those All major roads…are apartheid roads; in trait of Israel’s ruling political elite, years and those who ‘perfected’ its other words, Palestinians are banned a lineage of generals, ministers and operation: namely its power to abuse, from using them. Control of the roads bureaucrats. Breathing life into dry, humiliate and destroy.” has tightened since 2007. Movement now declassified government minutes, Inspired by other military regimes has become even more of a challenge Pappe succeeds in holding the reader’s (e.g., British Mandatory Emergency since the Israeli authorities recently attention, converting the tedious stuff Regulations and British counter-in- finished building a new highway (di- of cabinet meetings into an arresting surgency methods employed against vided by a wall segregating the road political disclosure. He also achieves Palestinians during the Arab Revolt into Jewish and Palestinian lanes), the rare feat of sustaining a sober of the 1930s), Israel’s occupation has which bisects the West Bank in two prose style while not dulling the edge successfully fused extreme human from north to south.” of his devastating critique. He allows brutality with routine bureaucratic A 50-year occupation, however, the facts—the words of Knesset behaviour. The Biggest Prison makes is no longer an occupation. It is, as members—to speak for themselves. this plain. It shows how the occupa- Pappe notes, an annexation, lodged The result is a startling revelation tion routinized a complex system of in the bedrock of Israel’s longstanding not only of the ministers’ proposed tyranny, discipline and surveillance expansionist agenda. For years, state course of action, but something of governed by a civil administration spokespersons have flouted Geneva their psychological makeup. that “not only regulated the freedom conventions and managed to define 42 the occupation as a temporary scenario. All the while they impact on clean water, sewage, medical aid, food and ensured its permanence, guarding it as a cover for settler technology, crippling Gaza’s already collapsing economy. interests. The arc of Pappe’s historical account allows us to The occupation’s endgame is surely evident in this lethal see the far-reaching logic of this hidden scheme. stranglehold over the impoverished Gazan population. In In effect, the lawmakers, ministers and bureaucrats Pappe’s telling there is but one conclusion we can draw designed a blueprint that would introduce intolerable from Israel’s historical record: the occupation is the work conditions for Palestinians—with the strong suspicion of a cabal of men who deemed themselves the figureheads that these jailed inhabitants would likely resist and ul- of a master race, entitled to dominate and incrementally timately receive their “just desserts.” The severity of the annihilate another people in the interest of “racial purity” occupation’s disciplinary measures did in fact provoke and economic profit. further resistance: two historic intifadas. The reaction was The Biggest Prison is not for the fainthearted. But it is predictable. The administrators construed these uprisings a must-read. It requires of those who deem themselves as “bad behaviour” and grounds for escalating degrees of progressive, but are reluctant to challenge the Zionist collective punishment (and land-grabbing): checkpoints, enterprise and its ideological underpinnings, to peer into separation walls, night raids, abductions, beatings, torture the abyss, to look horror in the face. Pappe does not spare and house demolitions. us the graphic details of collective punishment. The violent tactics of the Israel Defence Forces, as revealed in reports lan Pappe’s The Biggest Prison is arguably the most radical by the non-profit B’Tselem, do not make for easy reading historical critique of the occupation to date. The book anymore than the brutality of depopulation that Pappe Icasts light on hitherto sequestered facts: Israel’s military records in his Ethnic Cleansing of Palestine (2006). rule in the territories did not erupt suddenly on the morrow But to avert one’s gaze from the gravity of the occupation, of the Six Day War but was schemed four years prior to with its integral relation to the settler-colonialist project of the outbreak of hostilities in June 1967; the apparatus of 1948, is to plunge head first into denial, as did the cabinet military rule, imposed on Israeli Arabs between the late ministers of 1967. One hundred years ago, Freud put it 1940s and early 1960s, served as an important template for squarely when he said: “It is because we are creatures of the architects of the 1967 occupation; their blueprint, which the unconscious that we try to exert false authority over also drew on German and British precedents, was conceived ourselves…. We do not want to hear the internally unsettling and “perfected” in anticipation of an “opportune” crisis, and; news that might come from anywhere else. We are never the Six Day War was precisely such a crisis, not “an exis- more ruthless than when we are trying to block out parts tential threat.” In short, the war “justified” the occupation of our own mind.” and satisfied an unrequited expansionist impulse among Countless disturbing facts can be listed to describe the erstwhile Haganah warriors “to finish ‘48.” the unconscionable character of the occupation. Most With these disclosures, Pappe links the means and ends salient among these is the brutal violence to which youth of David Ben-Gurion’s ambition (i.e., to establish an expand- in the West Bank are regularly subjected. The kidnapping, ed and predominantly Jewish Israel) with the aims of a incarceration, and torture of children by Israel’s military generation of men who, in 1963, took charge of instituting forces constitutes a violation of human rights unmatched a military regime in the West Bank. Both the Nakba and in all self-proclaimed democracies. (See, for example, Ahed Israel’s biggest prison are key episodes in an overarching Tamimi’s 15-year-old cousin, Mohammed Tamimi, who was settler-colonial project. Both are forms of ethnic cleansing, permanently disfigured by Israeli soldiers when they shot differently achieved but harnessed to a common goal. him in the face at close range with a rubber-coated bullet.) One occurred through expulsion and massacre, the other It is no surprise that Pappe dedicates his work to these continues to unfold through endless, and ultimately lethal, victims, who have been, and continue to be, wounded, incarceration. killed or traumatized by living under occupation. In their Both the expulsion of 800,000 Palestinians in 1948 and tender youth, they represent the extreme vulnerability of the “enclaving” of 1.5 million Palestinians in 1967 were highly the Palestinian inmate, immured in prison cells and choked premeditated actions. Both were the result of intensively by Israel’s military grip. wrought schemes designed to empty Palestine of its in- On the question of Israel’s military rule, The Biggest digenous inhabitants for the benefit of Jewish settlement. Prison proffers what no swift soundbite can deliver: 300 Both occurred under the mantle of an “opportune” war, pages of in-depth historical knowledge and rare political with “existential threat” as a so-called pretext. insight. In these dark and desperate times, such enlight- Pappe’s chronicle of the collective efforts invested in enment is sorely needed. But Pappe’s book is more than a building the biggest prison on earth reaches its highest work of erudition and cogent analysis; it is also a display of pitch in the case of Gaza, “the maximum security prison.” courage and political conscience, an indictment of all those The deleterious effects of Israel’s merciless blockade on who have drawn up belligerent policies, revelled in military Gazans are enough to shatter the cornerstone of the state’s domination, and callously followed orders from above to self-proclaimed virtue. In the summer of 2017, Special wage a relentless war on the native inhabitants of Palestine. Rapporteur to the United Nations Michael Lynk declared In a pre-emptive strike, The Biggest Prison scuttles the the blockade a humanitarian crisis of catastrophic pro- claims of many who may one day say remorsefully: “Alas, portions. Severe cuts to electricity have had a devastating we did not know.” M 43 Books

REVIEWED BY ROXANNE DUBOIS Vive la Québécoise libre

FREETHINKER: THE LIFE But as the library grew, she was betterment of all people necessarily AND WORKS OF ÉVA CIRCÉ-CÔTÉ eventually demoted, her salary cut, went through books and learning; that ANDRÉE LÉVESQUE, when a man was appointed chief education would lead to the self-deter- TRANSLATED BY LAZER LEDERHENDLER librarian. Still, she fought to keep her mination of her people, francophone cherished place of work secular as and Québécois (or French Canadian at Between the Lines (October 2017), $34.95 the Church established a competing, the time), as they rose above their so- well-resourced library of its own. To cial situation, coming together to forge VA CIRCÉ-CÔTÉ WAS a diehard her, the library was an extension of a better world. The common thread of Montrealer,” writes Andrée her belief in the power of books to lift her entire work circles around advanc- Lévesque in her account of everyone up in the world, regardless ing the right to education and access a woman whose impact has of their wealth or background. to books, in particular for women and been, for too long, underesti- Circé-Côté took explicitly anti-im- girls. “Émated. As it turns out, this Montrealer perialist positions, despite her loyalty Her views were progressive, but was also a skilled journalist, a prolif- to France. Her first play told the story Circé-Côté was never a radical or a rev- ic writer, a provocative columnist, a of French colonizers and their inter- olutionary. She criticized capitalism, lifelong librarian and an independent actions with First Nations, which she but didn’t mix with organized labour. thinker who occupied a prominent viewed as destructive and regretful. She opposed the war, but only after place in the city. Yet her name is barely This unconventional understanding of death tolls and profiteering came to remembered. And without Freethink- history clashed with the common ver- light. She supported the Russian er, references to Circé-Côté would be sion that privileged a victorious view Revolution, but never joined the limited to a handful of historical doc- of France over Canada’s First Nations. Communist Party. She waged a war uments from the early 1900s. When she respected the last wish for women’s rights in the home and at Circé-Côté chose the pen as her tool of her husband to be cremated, Circé- work, but never personally associated early on in life. The vast body of her Côté faced the wrath of the Church, with the feminist movement. written work was published under which sought to discredit her. She She was a thinker in her own pseudonyms: Colombine, Fantasio, condemned the pernicious stronghold right, free of what she perceived as Julien Saint-Michel and others. For this institution held on Montréal. She the dogma and rigidity of popular most of her life she would balance her attacked the Church as a woman, as a movements. Lévesque highlights career, motherhood and friendships worker and as a city dweller. She had the occasional contradictions in while publishing multiple pieces in no patience for an imposed vision of Circé-Côté’s positions: did she mean print weeklies. the world that limited the people of everything she wrote, or was she being Her voice was woven deeply into Québec to being held under the power provocative for argument’s sake? the fabric of a changing city—a of “la Sainte Église Catholique.” Much of Circé-Côté’s writing, includ- Montréal that would traverse two Circé-Côté’s views on education ing entire plays and manusripts, has wars, inch toward industrialization, were socialistic. She believed that the been lost. Freethinker can therefore and welcome several waves of im- only provide a taste of the countless migrants. Circé-Côté’s Montréal is words she strung together over her the battleground between French lifetime. Since the original book is and English ownership and power, in French, it’s important the English between the Catholic Church’s dom- translation provides good context, inance and the dream of a better city since language is important. for everyone. Diving into the life and works of Circé-Côté’s main source of income Éva Circé-Côté is akin to wandering was a job at Montréal’s first public in the streets of Montréal in the library. She made the case to the city early 20th century, an activity which that a technical library would help she wrote about often and earnestly workers access resources to upgrade enjoyed. Circé-Côté remained a free- their skills. After the green light was thinker until her death, a fascinating given, the city appointed her to run woman that could very well have the new library—the project being been forgotten without this careful, too lowly to put a man in charge. and recommended, reconstruction. M 44 HELP US SHED LIGHT ON THE ISSUES THAT MATTER TO YOU. (we’ve got some bright ideas)

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