Economy about to tank, nobody cares from Grandinite
Seems the corporate elites have a thing for New Zealand and Australia. Check out SDA. ... [Read More]

Tracked on June 12, 2005 1:44 PM

Time to buy shares in National Casket.

Go for it Sean. Good luck.

I saw in the Sunday Vancouver Sun a picture of two people who just sold their home for a million bucks and are moving to Victoria. This is just plain scary. Everything goes in cycles. It's happened twice in the last 30 years. Remember the 18% mortgage rates of the 70s and 80s?

In 1992, a year before Paul Martin became Finance Minister, Canada Steamship Lines set up five companies in Liberia, Africa, a tax haven of choice in the offshore shipping business.

Paul Martin’s family business has expanded into a global empire.

Today, Paul Martin’s family business has expanded into a global empire. In Canada, CSL owns eighteen ships which fly our flag. It employs 500 Canadians, and pays Canadian taxes.

CSL also owns, in whole or in part, eighteen foreign flagged ships, sailing around the world, from Montreal to Melbourne.

[See: Flags of Convenience]

It has all made Martin a millionaire many times over. So what part did Martin play in CSL’s success story? As Finance Minister, under the so-called “Blind Management Agreement” he signed, Martin was allowed meetings with CSL–under “extraordinary” circumstances.

[DOCUMENTS: Martin’s Blind Management/Supervisory Agreement, 1994 (PDF) - and Martin's Public Declaration of Declarable Assets and Outside Activities, 1994 (PDF). See also: Ethics Counsellor: Conflict of Interest Code Public Registry: Paul Martin - page includes Martin's updated declarations of assets.]

Howard Wilson

Federal Ethics Counsellor Howard Wilson says Martin never gave CSL any specific direction.
There were about a dozen meetings in all. Both Martin and Federal Ethics Counsellor Howard Wilson (who attended the meetings) say Martin never gave CSL any specific direction.

WILSON: He was dealing with a highly qualified team and of course over the course of the years was more than happy to see how well they were doing.
DISCLOSURE: In the occasions where you had to discuss with him, he wasn’t saying ‘Look, get out of this line of business. Stop doing that, stop flagging your ships oversees, or stop registering your companies’ –
WILSON: This is not – they’re not – this is not reprehensible. It’s how do you operate the vessels and it’s fair to say that yes, the company has been imbued with Mr. Martin’s vision which is that he wants a company that is going to operate with concern for the communities in which they work and so on.

Paul Martin’s dual role as Finance Minister and owner of Canada Steamships Lines has raised concerns of a potential for conflict of interest. Martin has always suggested he could keep his public duties separate from his private interests.

But when it came time to set corporate tax policy, it would inevitably have a direct effect on his company.

In 1992, a year before he became Finance Minister, CSL set up five companies in Liberia, Africa, a tax haven of choice in the offshore shipping business.

Pierre Préfontaine

The companies had names like “Atlasco Shipping” and “CSL Iinternational Inc.” They had no employees and no offices, but they did help CSL avoid paying Canadian tax.

DISCLOSURE: Why did Paul Martin and CSL set up shell companies in Liberia in 1992?
PIERRE PRÉFONTAINE [CSL’s senior vice president]: What we are doing is legal, is recognized in Canada, in fact all Western world countries–
DISCLOSURE: I’m not suggesting it’s illegal.
PRÉFONTAINE: Right.
DISCLOSURE: I just want to know why you decided to set up these companies in Liberia.
PRÉFONTAINE: This, I mean this was part of the normal tax planning system, such that we are in a playing level field with our competitors.

Liberia wasn’t simply a tax haven – foreign affiliates there were also allowed to bring their profits back into Canada, tax-free.

And while CSL was setting up its shell companies in Liberia, Canada’s Auditor General was trying to shut down those kinds of tax havens. Denis Desautels said they were costing the government hundreds of millions of dollars:

“We have had long discussions with the department as to how much money could leak through that particular tax planning scheme,” he said at the time.
Martin delivering budget speech
Martin delivering the 1994 budget speech.
The very next year, a Commons committee urged the government to rethink its generous treatment of tax havens.

In 1994, the new Finance Minister, Paul Martin, took action: “Certain Canadian corporations are not paying an appropriate level of tax,” Martin said in his budge speech. “Accordingly, we are taking measures to prevent companies from using foreign affiliates to avoid paying Canadian taxes which are otherwise due.”

But Martin didn’t shut down all the tax havens. Across the Atlantic, he kept Barbados open, and that’s exactly where CSL went next.

DISCLOSURE: Why did you move your shell companies to Barbados in 1995?
PRÉFONTAINE: We moved them to Barbados because of the change in the Canadian tax rules.
DISCLOSURE: Was Paul Martin aware of this – when you moved to Barbados in 1995?
PRÉFONTAINE: Mr. Martin’s assets are in a blind management trust.
DISCLOSURE: Was he part of this decision to move to Barbados?
PRÉFONTAINE: This is a question that you should ask Mr. Wilson [Federal Ethics Counsellor].
DISCLOSURE: Was this discussed at any of your meetings?
PRÉFONTAINE: These are all questions that should be put to Mr. Wilson.

We had put those questions to Howard Wilson, but he can’t reveal details of those meetings without permission from CSL and Paul Martin.

DISCLOSURE: What was discussed at these meetings?
WILSON: Well I’m, I’m not really in a position to go and tell you. These are matters that are covered by the Privacy Act.
DISCLOSURE: We’re just asking what went on in those meetings. And what was discussed I those meetings.
WILSON: Well, you’ve got my answer on that.
DISCLOSURE: We’re not going to know.
WILSON: No.

Canada Steamship Lines now has nine shell companies in Barbados, eight of them at a lawyer’s office near Bridgetown. They share the same mailbox and the same tax rate: about 2.5 percent.

CSL is not alone. Canadian companies have set up about 1,700 affiliates in Barbados to take advantage of this loophole, most of them in the financial sector.
Robert Brown
Robert Brown was part of a committee of tax experts set up by Martin that urged himi to close loopholes like those in Barbados.
And just like Liberia, the companies can bring their profits back into Canada without paying Canadian tax. In the year 2000, the companies brought $1.5 billion dollars back into our country.

Robert Brown is the former CEO of Price Waterhouse. He was part of a committee of tax experts set up by Martin himself. In 1997, the committee urged Martin to close loopholes like those in Barbados.

BROWN: The whole thing is set up artificially for tax reasons.
DISCLOSURE: The substance is that they’re a tax dodge.
BROWN: The substance is that there isn’t much reality to them, yeah.
DISCLOSURE: The reality is they’re getting a tax holiday.
BROWN: That’s correct.

But Martin’s ministry said closing the loophole would only keep offshore money offshore. That wouldn’t help Canadians; and it would hurt those Canadian companies compete abroad.

BROWN: That’s true, but it doesn’t mean that we have to go into international tax for the race to the bottom to see how much we can give away.
DISCLOSURE: Why wouldn’t Mr. Martin then act on that recommendation?
BROWN: Well, there are always different views on the matter. I can’t explain the rationale of the people that looked at it.

Howard Wilson says he considered –but rejected– the idea of asking Martin to remove himself from any decisions involving foreign tax havens. He didn’t see it as a conflict.

Paul Martin left the Finance Ministry last June, leaving the Barbados loophole –and others– wide open.
“My concern is that the public interest has been fully protected,” says Wilson. “Why? Because he did not ever take decisions as Finance Minister that would be directly beneficial to his company.”

But that’s all in the past now. Paul Martin left the Finance Ministry last June, leaving the Barbados loophole –and others– wide open. But shortly after he left, the latest Auditor General called upon his replacement to finally plug the hole.

Paul Martin refused all of our phone and fax requests to sit down for an interview with Disclosure to discuss taxes and CSL. We wanted to ask him how he reconciles his use of tax havens and shell companies outside Canada with his desire to lead the country.

“I wish to see him as Prime Minister to Canada,” one of the CSL Pacific's workers told us. “I feel very proud to work for him."

Martin refused our requests, so we asked professor Elizabeth DeSombre instead. She studies the effect of flags of convenience at Wellesley College near Boston:

DeSOMBRE: Canada has chosen to tax its industries, to tax its workers, to have a system of environmental safety and labour standards, to have a wage rate. And by essentially flagging ... ships somewhere else, you’re opting out of that system that Canada chose to have.

DISCLOSURE: And how does that strike you?

DeSOMBRE: [It’s] an odd thing for a politician to do. Not at all a surprising thing for a businessperson to do, but an odd thing for a politician to do.

The new sailors on Martin’s ship, the CSL Pacific don’t think it’s odd. They’re proud of Paul Martin.

“I wish to see him as Prime Minister to Canada,” one told us. “I feel very proud to work for him." "When the owner of company have power, this is good,” says another.

If they could vote for him they would, but they can’t. They’re Ukrainians.

[Next: Paul Martin Timeline]

Librano$$$$$$$$$$$$$$$$$$$$

"If they could vote for him they would, but they can't. They're Ukrainians."

Big money flies way.

Martin did it; Librano$ love him.

All other Canadians are suckers to AdScam Martin.

Alarmist ??

Yes . . . this is just so much paranoia, heard it all before.

there is too much outside scrutiny for even Liberanos to steal the EI & the CPP funds.

Not that I like Liberals, I hate the bastards, but this kinda stuff comes up every few years and people dig holes, stock them with food and then wait for Armageddon.

FYI . . . those BC house prices are still going up . . if you have $850k I have a downtown condo, good size >1300 sq ft and a killer view that we could discuss :).

We were offered $750k a year ago . . . next year a Mill ??

Fred, I'm a survivor of the dot com bomb. In 2000 I quit my nice secure job as a techie at Red Deer College after I was lured to Edmonton by filthy dot com lucre. A couple months after I had started with the new employer the bottom fell out of the dot com market. And the NASDAQ. And the Dow Jones.

I'll never forget how the guy who hired me at the dot com told me that we were riding a wave that 'would never end'.

All waves have to crash against the shore at some point.

I purchased my home for $145,000 in 2001. It's currently listed at $198,700 and we're getting a lot of interest in it. When a house goes up that much in that short a period of time, it tells me that we're riding a bubble. Or a wave.

I don't buy everything HD said, but I do agree that things are looking pretty bad. The entire world economy is currently being propped up by the U.S. consumer and their willingness to borrow against the equity in their homes to finance other purchases. The debtload in the U.S. is staggering. What happens when U.S. consumers run out of credit? What happens when the ripples hit Canada?

I don't want to be right about this, but I'd sure as hell hate to not do anything and be wrong. That would be a very bad thing.

Thanks so much for the LYRICSFREAK.COM website- anything you want- it's all there. Check out The Who's 'Won't Get Fooled Again':
And the men who spurred us on
Sit in judgement of all wrong
They decide and the shotgun sings the song.

And to my old bud 'Tiny', ( retired OPP), for your advice: "Go for the Mossberg riotgun- it's cheap, and it does the job." (It's a short barrel pump, 12guage. Load is: one buck, one slug, one buck, one slug).....

If nobody else, it sounds like Martin is well situtated to leave Canada when the time is right.

And "outside scrutiny" doesn't mean much if the agency conducting it has no power to do anything about it. Or if it's the same "outside scrutiny" the UN had in the form of Volcker.

The Global Shift

Yes, we are witnessing one of the great transfers of power and influence that have traditionally changed civilization itself, as money, influence, and military power are gradually inching away from Europe. And this time the shake-up is not regional but global. While scholars and economists concentrate on its economic and political dimensions, few have noticed how a new China and an increasingly vulnerable Europe will markedly change the image of the United States.

As nations come to know the Chinese, and as a ripe Europe increasingly cannot or will not defend itself, the old maligned United States will begin to look pretty good again. More important, America will not be the world’s easily caricatured sole power, but more likely the sole democratic superpower that factors in morality in addition to national interest in its treatment of others.

China is strong without morality; Europe is impotent in its ethical smugness. The buffer United States, in contrast, believes morality is not mere good intentions but the willingness and ability to translate easy idealism into hard and messy practice.

Most critics will find such sentiments laughable or naïve; but just watch China in the years to come. Those who now malign the imperfections of the United States may well in shock whimper back, asking for our friendship. Then the boutique practice of anti-Americanism among the global elite will come to an end.

— Victor Davis Hanson is a military historian and a senior fellow at the Hoover Institution at Stanford University. His website is victorhanson.com

http://www.nationalreview.com/hanson/hanson200506100747.asp

Wow, you create a lot of excitement over an unsubstabtiated rumour. You should work in the stock market.

The balance of $3.5 billion would have to come from the surplus (if there is one after another $2 billion debt paydown) at the end of the second year, around August 2007.

Finance officials also caution that any year-end emergencies -- akin to the SARS outbreak or mad-cow crisis -- would also be funded from any surplus ahead of the Martin-Layton deal.

Of course, if the surplus is less than the $2 billion allocated for debt reduction, not a dime will flow to anything in the bill.

In that case, Layton will join the homeless, students and aboriginals as the latest Canadians to be screwed at Paul Martin's great government garage sale.

Greg Weston. canoenews.ca

Librano$$$$$$$$$$$$$$$$$$$$$$$$$$$$$$

The cost of a Librano$ membership card is unknown.

Join the screwers; don't be a screwee.

"Wow, you create a lot of excitement over an unsubstabtiated rumour. You should work in the stock market."

It's not just me saying things like this. It's magazines like the Economist. It's people like Edward Greenspan.

"It's people like Edward Greenspan."

Alan's evil twin, no doubt.

Ah, crap. Pardon me while I pull my foot outta my mouth. Been having one of THOSE days, y'know.

Wow - Edward Greenspan - prominent celebrity lawyer. I guess he would be an expert on the global economy. Or not. You rumor-mongers should take a chill pill. The world economy isn't going into the dumpster. There are a lot of people who don't like how successful modern Western society is, and they make careers out of regularly predicting its demise. They are consistently wrong. But this is lame even for them - a story about a guy who knows a guy who played golf with a guy who talked to a guy who said some guys who can't be named are doing terrible things in secret that are gonna BE OUR DOOM!!!?? Give me a break. It's the Protocols of the Elders of Westmount.

If you want a clear-headed, big-picture type view of the global economy, try Columbia University economist Xavier Sala-i-Martin. You should check him out anyway, because his web page is very cool. And he has both data and arguments to sustain the case that the world economy has been getting better for 3 decades, everywhere except Africa. Here's a link:

http://www.columbia.edu/~xs23/home.html

The Captain in the wheelhouse of the ship of Canada registers his own fleet under the Barbados logo.
Captain's friends who leave the ship, head for Turks and Cacaos, with their secret trusts in tow.
Smacks of piracy to me.
The part about laying off Canadian crews and hiring on through Barbados bugs me too.
We see Conrad Black on television, packing off black filing boxes of corporate files. No evidence of RCMP curiosity. I thought Conrad was under indightment for fraud.
Seems like more piracy to me.
I guess when Martin, Black and Gov. Gen. Clarkson eventually settle in the Turks and Cacaos, they will raise a glass to Canada and it's sleepy citizens. 73s TG

Rats always go first.

Edward Greenspon?

sean said "I purchased my home for $145,000 in 2001. It's currently listed at $198,700 and we're getting a lot of interest in it. When a house goes up that much in that short a period of time, it tells me that we're riding a bubble. Or a wave"

Or the worls discovers you have a really good place to live and wants to live there too. Like Vancouver.

Many of teh people buying in at a million are from England and the US . . they think the prices are CHEAP in comparison to what they are used to . . . so will thre be a market levelling some time . . Yes. Will there be a bubble bust . . not likley here. And even if thee is a burst teh laws of real estate valuation still apply . . "the best places go up the most first and down the least, last"

Coal Harbor & Yaletown in Vancouver in the first-most/least-last category so what happens elsewhere is someone else's reality to deal with.

Wealth, being created as we live here.

Not Edward, Alan, as was previously pointed out.

Mea culpa, mea culpa, mea culpa.

Okay? Okay!

This situation really does not have a lot to do with the appreciation of house prices. It may, however, affect the cost of mortgages when interest rates go up.

I have gotten numerous interesting emails. All I can say is don't rely on the mainstream media for news or the various "talking heads" that placate or sedate Canadians over the state of our economy.

Also, I would not take ANY financial report by this Federal Government with anything but a sceptic's view.

Nobody except the governing party and whomsoever they assign has been able to see the real true books of this country for 12 years.

And, as we speak the paper shredders and bank documents and contracts and paper trails are fast disappearing.
Thanks to all of you who have sent me more info.

My home deep in the Ottawa Valley was bought for $129,000 less than three years ago. It's now worth about $175,000.

I'm willing to take offers of a CHEAP $500,000. I don't want to sound gready and ask for a million... :-)

Where is the proof?

Dont make baseless allegations unless you have some proof other wise this site will be no different then all the other left wing conspiracy sites.

http://tinyurl.com/e4j2t

http://tinyurl.com/8djuu

http://tinyurl.com/cgz8e

http://tinyurl.com/9de5r

anon - I thought this site was for crazy RIGHT wingers :-)

It is HappyDaze, we both belong here.

Tho personally I'm having doubts (at least about myself) lately.

I kind of flip-flop around the middle. But I *am* crazy, so am I allowed to play with you guys?

Thanks for the link Sean...

I happen to agree with Fred that the economy is, in fact, booming. But it is also on a knife edge with a great deal of that boom being financed with loans drawn on the appreciation of peoples' homes.

There are any number of factors which can tip the economy into a) full on recession, b)a nasty inflation, c) a nasty asset deflation.

While 28.8 sucks, it is sometimes better to have a slow modem and cash than a fast one with debt.

2 years til my house is paid off! If interest rates hit 20% like they did with Trudeau, I don't even have to adjust my payment, but the 2 years....

Oh plus 60% of the homeless in Ottawa were not born in Canada. How does the homeless figure in?

I laughed at one of my cow orkers over a year ago the payroll didn't go through and he was claiming he couldn't survive because all his credit cards were maxed out. For no good reason other than he couldn't control his spending. DINKS too, eh. Here I thought plastic was for emergencies. If we ever hit Trudeaus interest rates the economy will crack open and we'll make an omelet :)