The Sixth Estate

The High Canadan Corporate Tax, And Other Myths

Sometimes, a newspaper’s op-ed page actually is a forum for the presentation of new and exciting ideas, or insightful commentary and reflections. Certainly that’s what they’re billed as. Usually, though, they’re just an opportunity for paid shills to spout off without having to be confronted by opponents or misquoted by a reporter. Take, for instance, this Sunday’s anti-corporate income tax screed in the Ottawa Citizen.

The article in question is a demand by Perrin Beatty that Canada lower its corporate income tax rate so that we can grow our way out of the recession. Maybe. But here’s the problem: Beatty is the head of the Canadian Chamber of Commerce. His organization is made up of corporate businesses. So this isn’t sober reflection on a public policy issue. This is a corporate shill saying that his patrons want to pay less taxes. Quelle surprise! (more…)

Middle Eastern Democracy: Elliott Abrams Invents History, Slams Obama

Elliott Abrams, another of the old Iran/Contra gang, crawled back out of the woodwork to publish a denunciation of Obama administration foreign policy in this Saturday’s Washington Post. Abrams says “George W. Bush was right about freedom in the Arab world” and that Obama has done both America and Arabs a disservice by abandoning his predecessor’s commitment to Middle Eastern democracy. Har. This is particularly amusing coming from Abrams, given his history in the Reagan years.

I’m not one to defend the Obama administration’s foreign policy choices. This government has failed to assist democratic movements opposing dictators and military coup-plotters not just in the Middle East but also much closer to home — in Honduras, for instance. This isn’t because Obama “abandoned” the commitment to democracy, though. He’s just continuing the Bush administration’s line — much as they picked it up from their predecessors, too.

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Why Foreign Militaries Like their American Allies

As I was combing through the latest pile of WikiLeaks cables, the batch including inflammatory material contributing to the potential revolution now underway in Egypt, I was struck by this sentence in a secret briefing to General Norman Schwarz in 2009:

President Mubarak and military leaders view our military assistance program as the cornerstone of our mil-mil relationship and consider the USD 1.3 billion in annual FMF (Foreign Military Financing) as “untouchable compensation” for making and maintaining peace with Israel. The tangible benefits to our mil-mil relationship are clear: Egypt remains at peace with Israel, and the U.S. military enjoys priority access to the Suez Canal and Egyptian airspace… Egypt remains a key U.S. ally…

One way to demonstrate Egypt’s continued strategic importance is through shifting more FMF funding to address asymmetric threats like terrorism and improving border security… The EAF [Egyptian Air Force]… [is] prepar[ing] to purchase 24 F-16 aircraft that will require a costly retrofit with less-advanced weapons systems… [Some] systems are either not releasable to any country or denied for political reasons, mainly due to concerns regarding Israel’s Qualitative Military Edge.

This hogwash easily illustrates the inconsistency of American policy short of one key goal: “buying” the political support of foreign governments by bribing their militaries.

On the one hand, Egypt is a “key ally.” On the other, the U.S. is deliberately fobbing off second-rate technology — and, notice, charging them to downgrade it further — on the principle that Israel must always have a stronger military. (Israel is also a major recipient of military aid.) On the one hand, the military funding is supposed to be used to push Egypt into counterterrorism. On the other, they’re selling them F-16 fighter jets, which don’t really have any role in counterterrorism. Of course, there is an obvious benefit for General Dynamics, the American company that manufactures the F-16.

So the Americans get a reliable ally, and the recipient military gets a ton of cash which it can use on American planes, or suppressing protests, or whatever.

SEC Investigation, Part 2: SEC Knew About $8 Billion Fraud for 12 Years and Did Nothing

Recently, I’ve explored issues of dubious investigations at the Securities and Exchange Commission (SEC), the American law enforcement organization charged with enforcing stock trading laws — a job it seems spectacularly bad at, or maybe deliberately bad at.

Another example of this can be shown in the pair of reports issued by the Office of the Inspector-General surrounding the Ponzi scheme operated by Texan billionaire Allen Stanford. Stanford’s scheme was valued at $8 billion, which is enormous but still dwarfed by Bernie Madoff’s far larger scheme. Incredibly, the OIG documents (here and here) reveal that the SEC knew about Stanford’s crimes for years, before finally taking action in 2009. Stanford is now before the courts, being represented by the same lawyer who once defended Iran/Contra criminal Oliver North.

Stanford’s scheme involved CDs (known in Canada as GICs), which both large investors and ordinary Americans sunk their life savings into. In this case, I really do mean “sunk.”

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WikiLeaks: American Targets in Canada

This past week saw another round of WikiLeaks cables released. Few of them seem to have relevance to Canada, but we do (once again) show up on a Secret list of terrorist targets around the world.

The list is a document that American diplomats prepare and circulate annually, and when some other versions appeared in the past, the leak was denounced as endangering lives. I disagree. The contents of this list are strategic resources. Terrorists do not attack militarily strategic resources: they aim to produce an emotional and political response, not a military one. (more…)

The Muzzling of Stephen Harper’s Conservative MPs

Stephen Harper’s control over his caucus (or rather, the Prime Minister’s Office’s control over the caucus) is now legendary. After five years, not only the MPs themselves but, more disturbingly, the Ottawa media have largely come to accept the new political reality that every single public moment is carefully planned out by agents in the PMO. As a country we will eventually suffer very serious consequences of this affront to democracy, if it takes root in the institutional culture rather than being an aberration, peculiar only to this particular manic bunch of secretive managers.

In the meantime, I was sifting through my archive of old Wikileaks material when I came across a superb example of this disturbing trend. Wikileaks received a “Constituency Week Caucus Package” sent to Conservative MPs in May 2009, with the theme “Protecting Canada’s Future.” As usual the document is a masterpiece of vague flimflam: the implication is that Canada’s future is under threat, though nowhere is there an indication of what this threat is. The bulk of the package is a “May Constituency Week Stump Speech,” which is not merely a list of key party talking points (that I might expect) but in fact a word-for-word speech which Harper apparently wanted every single riding in Canada to receive. Note the pathetic attempt to make the speech sound “local”: (more…)

Inside a Secret “P3″: Canada’s CSE and Plenary Properties

Insufficient attention in Canada is being given to the expansion of the country’s intelligence services. The Canadian Security Intelligence Service (CSIS) more than doubled in the past decade, from $180 million in 2000 to $480 million in 2009. It is also expanding its foreign intelligence activities, in clear violation of the CSIS Act. The most obvious current example of intelligence largesse, though, is the new building being constructed for CSIS’s “partner” agency, the Communications Security Establishment. CSE’s new “Taj Mahal,” interestingly, also intersects with another critical problem: the hollowing out of government and increasing dependence on shady networks of secret contractors.

CSE doesn’t get a lot of attention in the news and has avoided scandals, unlike CSIS or its predecessor, the RCMP Security Service. This does not make it small or unproblematic, though. The organization has spent most of its history since 1945 essentially as a branch plant of American signals intelligence (the National Security Agency). The government did not acknowledge its existence until the 1970s, and it operated wholly outside Parliamentary law until an enabling act was finally passed in 2001. Befitting its low profile, its offices in Ottawa were until recently crammed into some nondescript buildings on the campus of Canada Post. That’s changed, and the new plans are for a massive new campus referred to (in public) as the Long Term Accommodation Project, or LTAP.

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This is Canada

Over the past couple of weeks I’ve sort of been wandering with this project, searching vaguely for some sort of unifying theme. I’ve decided I have one after all, after being infuriated by this.

First, to be fair, the gentleman with the backpack is being a bit obnoxiously. On the one hand, I understand the logic: just as governments say they will not negotiate with terrorists, acquiescing to unreasonable and even illegal demands by police simply encourages them to continue their unacceptable behaviour. On the other hand, you also have to pick your battles, and I’m sure he did.

That said, this behavour is grossly unacceptable from a Canadian police officer. The officer doing most of the talking is, according to media reports, Mark Charlebois. By the evidence, Charlebois is an arrogant, ignorant goon, so drunk on the power of his badge and gun that he’s forgotten what laws he’s supposed to be upholding. And if this video does force the government to take notice, he may face a richly-deserved punishment for it.

But that, in a sense, would be a shame, because we’ve all seen this tired old play before. Charlebois will be dismissed as an unfortunately overzealous underling, possibly with a record of unacceptable behaviour, possibly not. This will conveniently allow his superiors, the ones who convinced him that it was acceptable to behave this way at the G20, not to have their own even more illegal behaviour unquestioned. Those who are actually responsible, not for one foolish throwaway sentence but for all that happened over those few days, work and live at a level where, from the perspective of the current system, they are simply above and beyond punishment or even accountability.

Inspector-General Reports on SEC Incompetence

One of the most phenomenal aspects of the stock market mayhem of the past two years was the discovery that the American Securities and Exchange Commission (SEC) is one of the most inept law enforcement organizations in the country. There have still been virtually no prosecutions or lawsuits, despite evidence of massive fraud. Despite large amounts of evidence being presented to them by concerned outsiders, the largest fraud in history, that of Bernie Madoff, was similarly missed.

The SEC possesses an outside oversight body, an Inspector-General, who monitors the organization, identifies wrongdoing, and makes recommendations for improvements. Most of the reports are public and unclassified, and most of them even (used to) appear on the organization’s website. Curiously, however, not all of them do. In fact, some of them were even removed from the website, according to the Project on Government Oversight (POGO).

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News and Documents

U.S. Army torture orders, FBI surveillance files on Edith Helm, and Clinton administration immigration crisis plans. (more…)