Quotulatiousness

July 4, 2012

British banks are “a cossetted, subsidised industry with captive consumers”

Filed under: Britain, Economics, Government — Tags: , , , — Nicholas @ 08:46

If any industry has more than its fair share of “too big to fail” wards of the state, it’s the banking sector. Allister Heath in the Telegraph:

There is a horrendous problem, certainly, and urgent reform is required. But the ailment has been fundamentally misdiagnosed: banking has become a ward of the state, a cossetted, subsidised industry with captive consumers, and it is that which has crippled it. We have been there before, in other sectors, and the medicine is always the same. This may come as a shock, but we need more capitalism in banking, not less.

Banks need to be allowed to go bust, like every other private company. It was a disgrace that taxpayers were called upon to bail out some of the City’s grandest names. This must never happen again. The reason capitalism works so well, whenever it is tried properly, is that the principle at its heart — profit and loss — is the toughest of disciplines and the best of motivators. It is more ruthless than anything regulators, however clever, could ever dream up. It allows two conflicting emotions, greed and fear, to balance one another out. Shareholders, creditors and bosses want to make money — but they know that a step too far might entail ruin.

That, at least, is how it works for much of UK Plc — but no longer in banking, where profits have been privatised and losses nationalised. It is an obscene perversion of capitalism. Forget the nonsense about “light touch” regulation: the problem is that the fear of failure ceased to exist. Market discipline was replaced by extreme laxity.

There was no longer much need for prudence, proper capital buffers or strict internal controls: the taxpayer was ready to pick up the bill if anything went wrong, while incompetent regulators signed everything off. The Labour government which introduced this mad system wasn’t deliberately seeking to subsidise risk: it merely made a terrible mistake, though with the politically useful side effect of reducing the cost of credit and increasing its availability. The real blunder was that the Financial Services Authority had no plan to cope with a bank going bust. It simply assumed failure would never happen. After all, how could it? Gordon Brown had abolished booms and busts.

July 2, 2012

Alex Tabarrok on the slow rail and infrastructure bottleneck

Filed under: Bureaucracy, Economics, Government, Railways, USA — Tags: , , , , , , — Nicholas @ 10:58

Writing at Marginal Revolution, Alex Tabarrok wonders “Why haven’t the $500 bills been picked up?”:

High speed rail, especially California’s project, looks to me to be monorail economics, a costly boondoggle whose appeal lies not in rational calculation […] but in the desire of some politicians (and voters) to feel visionary and sexy. In theory, CA HSR might work but the inevitable reviews, delays, lawsuits and special interest payoffs make the prospects of a beneficial project look dim, demosclerosis kills.

Slow speed rail, however, i.e. freight transport, isn’t sexy but Warren Buffett is investing in rail and maybe we should as well. In particular, there are basic infrastructure projects with potentially high payoffs. Congestion in Chicago, for example, is so bad that freight passing through Chicago often slows down to less than the pace of an electric wheel chair. Improvements are sometimes as simple as replacing 19th century technology with 20th century (not even 21st century!) technology. Even today, for example:

    …engineers at some points have to get out of their cabins, walk the length of the train back to the switch — a mile or more — operate the switch, and then trudge back to their place at the head of the train before setting out again.

In a useful article Phillip Longman points out that there are choke points on the Eastern Seaboard which severely reduce the potential for rail:

    …railroads can capture only 2 percent of the container traffic traveling up and down the eastern seaboard because of obscure choke points, such as the Howard Street Tunnel in downtown Baltimore. The tunnel is too small to allow double-stack container trains through, and so antiquated it’s been listed on the National Register of Historic Places since 1973. When it shut down in 2001 due to a fire, trains had to divert as far as Cincinnati to get around it. Owner CSX has big plans for capturing more truck traffic from I-95, and for creating room for more passenger trains as well, but can’t do any of this until it finds the financing to fix or bypass this tunnel and make other infrastructure improvements down the line.

June 27, 2012

California primed to make bad decision for “good” reasons

Filed under: Environment, Food, Government, Health, Science, USA — Tags: , , , , — Nicholas @ 00:05

California’s already bad economic situation could be made even worse by mandating that genetically modified foods be labelled to call attention to themselves:

The American Medical Association resolved this week that “there is no scientific justification for special labeling of bioengineered foods.”

The association has long-held that nothing about the process of recombinant DNA makes genetically engineered (GE) crop plants inherently more dangerous to the environment or to human health than the traditional crop plants that have been deliberately but slowly bred for human purposes for millennia. It is a view shared by the National Academy of Sciences, the World Health Organization, the Food and Agriculture Organization of the U.N., the European Commission, and countless other national science academies and non-governmental organizations.

And yet Californians will consider on their November ballots a law that mandates cigarette-like labeling of food derived from GE plants. Proponents claim to promote opportunities for consumers to make informed choices about the foods they eat. But to build support for the measure, they have played on consumer fears about a promising technology that is nevertheless prone to “Frankenfoods” demagoguery. If successful, they may well imperil the ability of Californians, and consumers around the world, to choose a technology that scientists contend could end hunger and malnutrition, lift hundreds of millions from poverty, and reduce the environmental impact of feeding an evermore populous world.

June 22, 2012

Charities: the Trojan Horse for expansion of government

Filed under: Britain, Bureaucracy, Government — Tags: , , — Nicholas @ 08:51

Some charities are still what they were twenty years ago: organizations that provide help to those in need. Others, however, have morphed into specialized entities that exist primarily to lobby the government for more funds … to allow them to lobby more efficiently:

The relationship between charities and the British state has been significantly transformed in the past 15 years. There is a gulf between the public’s perception of what is charitable – a traditional view still dominated by visions of self-sacrificing volunteers and jumble sales – and the third sector’s view of itself as a more caring, semi-professional wing of the state. The public can be forgiven for being confused about a ‘voluntary sector’ that, according to a 2009 report for the National Council for Voluntary Organisations (NCVO), employs more than 600,000 people. The public might equally be puzzled by the plethora of ‘non-governmental’ organisations which require an Office of the Third Sector to preside over them.

Between 1997 and 2005, the combined income of Britain’s charities nearly doubled, from £19.8 billion to £37.9 billion, with the biggest growth coming in grants and contracts from government departments. According to the Centre for Policy Studies, state funding rose by 38 per cent in the first years of the twenty-first century while private donations rose by just seven per cent.

This surge in government spending coincided with a politicisation of the third sector which was actively encouraged by the state apparatus from the prime minister down. Traditionally, lobbying activity could not be a charity’s ‘dominant’ activity, but could only be ‘incidental or ancillary’ to its charitable purpose. In 2002, however, a report from the Prime Minister’s Strategy Unit called for charities to increase their lobbying activity and for the Charity Commission guidelines to be made ‘less cautionary’: ‘Charities perform a valuable role in campaigning for social change. The guidelines on campaigning should be revised to encourage charities to play this role to the fullest extent.’

The Charity Commission duly revised its guidelines on campaigning two years later, allowing all non-party political campaigning in furtherance of a charity’s goals so long as this activity was not ‘the dominant method by which the organisation will pursue its apparently charitable objects’. A subsequent Cabinet Office report in 2007 called for the rules to be relaxed further still. Accepting that charities had ‘considerable latitude… for political campaigning under existing rules’, the authors expressed concern about the range of legal and regulatory restraints which ‘unjustifiably restricts political campaigning by third-sector organisations’. Stressing the right of charities ‘to undertake campaigns, regardless of any funding relationship with government’, the Cabinet Office argued that organisations whose purpose was wholly political should not be barred from charitable status: ‘Provided that the ultimate purpose remains demonstrably a charitable one, the government can see no objection, legal or other, to a charity pursuing that purpose wholly or mainly through political activities.’

There are still charities that do what most of us think of as “charity”, but far too many of them are just lobbying devices to accomplish political rather than charitable ends. There’s no reason to prevent organizations from political lobbying, but they should not benefit from the special tax status of genuine charities.

June 19, 2012

Big business loves regulation: it keeps competition at bay

Filed under: Business, Economics, Government — Tags: , , , , — Nicholas @ 08:04

Jan Boucek at the Adam Smith Institute blog, with a couple of examples of big business welcoming additional government intervention in their markets:

First out of the trap was Barclays CEO Bob Diamond. In an interview Wednesday with Bloomberg, he reprised his long-standing mantra that “strong banks, like Barclays, want strong regulation.”

This sounds good in our current age of finger-pointing and bank-bashing but serves Barclays well if high barriers to entry keep out more competition from Diamond’s industry.

Then in an interview Friday with The Financial Times, the outgoing head of retail at Royal Bank of Scotland Brian Hartzer suggested regulators should forcibly end free current accounts. He smoothly phrased it in terms that chime with today’s sentiment: “Regulatory intervention might be helpful in forcing banks to the table” and “A large proportion of customers are being cross subsidised — we think that’s unfair.”

Of course, what Hartzer proposes means banks no longer having to compete on price for their most basic product.

Both these sweetly melodious proposals for more regulation need to be treated with Adam Smith’s “most scrupulous” and “most suspicious attention” because they’re music to the ears of our discordant political maestros.

The closer big business and government become, the stricter the regulations against individuals and firms trying to compete with the big businesses. Small firms are almost always disproportionally impacted by industry-wide regulations (and that’s by design), which makes them less able to compete with the established firms. Regulators are more help to big companies than clever advertising, innovative product development, or good customer relations.

QotD: The mottos of “High Liberalism”

Filed under: Economics, Government, Liberty, Quotations — Tags: , , , , — Nicholas @ 07:45

The story is, in a few brief mottos to stand for a rich intellectual tradition since the 1880s: Modern life is complicated, and so we need government to regulate. Government can do so well, and will not be regularly corrupted. Since markets fail very frequently the government should step in to fix them. Without a big government we cannot do certain noble things (Hoover Dam, the Interstates, NASA). Antitrust works. Businesses will exploit workers if government regulation and union contracts do not intervene. Unions got us the 40-hour week. Poor people are better off chiefly because of big government and unions. The USA was never laissez faire. Internal improvements were a good idea, and governmental from the start. Profit is not a good guide. Consumers are usually misled. Advertising is bad.

Thus Anderson: “Externalities, asymmetrical information, and other collective action problems are … pervasive in economic life. Countless ways of conducting business reap gains for some while imposing unjust costs on others. Create a cartel. Stuff rat feces in sausages.” Thus Freeman: “It is a truism to say that in order to achieve the benefits of an efficient market economy (increasing productivity, greater economic output, increasing productive capital, etc.), the basic rules of property, contract, and exchange must be structured [by government] to realize efficient market relations.”

No. The master narrative of High Liberalism is mistaken factually. Externalities do not imply that a government can do better. Publicity does better than inspectors in restraining the alleged desire of businesspeople to poison their customers. Efficiency is not the chief merit of a market economy: innovation is. Rules arose in merchant courts and Quaker fixed prices long before governments started enforcing them.

I know such replies will be met with indignation. But think it possible you may be mistaken, and that merely because an historical or economic premise is embedded in front page stories in the New York Times does not make them sound as social science. It seems to me that a political philosophy based on fairy tales about what happened in history or what humans are like is going to be less than useless. It is going to be mischievous.

Dierdre McCloskey, “Factual Free-Market Fairness”, Bleeding Heart Libertarians, 2012-06-16

June 13, 2012

When is a bribe appropriate?

Filed under: Britain, Bureaucracy, Business, Law, Russia — Tags: , , , , — Nicholas @ 09:59

The British government is trying to crack down on bribery, which on the surface seems like a good thing to do: but will it cripple British businesses in third world countries?

We used to draw a distinct line between what was acceptable business conduct here at home and what we did abroad with Johnny Foreigner.

Inviting Bertie from your major customer to Henley or the Derby, or waving Cup Final and Olympic tickets in his face was entirely acceptable. Slipping him £500 for an order was bribery and both illegal and immoral.

But what you did abroad was an entirely different matter: bribery was until very recently tax deductible.

[. . .]

This is of course very different from the system of old. Which was, essentially, that soft soaping someone with experiences and days out was just absolutely fine while any mention at all of cash was not just legally but also socially verboten.

At home, in Britain, that was. Having worked in some pretty odd and even rough places I’ve done my share of bribing people, but even so I would be profoundly shocked if I was asked for a bung in Blighty. But the system also most definitely facilitated the payment of bribes to Johnny Foreigner.

At one point, working in Russia, I needed to get cheap railway prices out of the Russian railroads to make the numbers on a metals shipment add up. The only way known to do this was to make a deal with the North Koreans who had special state-set prices on said railways. Which is how I found myself inside the N. Korean embassy in Moscow handing over $10,000 in crisp notes to their KGB-style guy after the successful conclusion of the shipment.

Yes, of course, it’s terribly naughty subverting the employees of a communist dictatorship, but the reaction here at home was the most interesting. When I made gentle enquiries to the taxman as to how I might account for this transaction, hinting gently at first, he finally pointed out that since I’d paid the bribe in a foreign currency to a foreign chap that was just fine. Just list it as a business expense and it was tax deductible.

June 1, 2012

Bloomberg’s latest “nudge” experiment

Filed under: Food, Government, Health, Liberty, USA — Tags: , , , — Nicholas @ 08:28

In his Maclean’s column, Colby Cosh explains the problem with New York City mayor Michael Bloomberg’s attempt to solve the obesity problem 32 ounces at a time:

Stopping people from exercising preferences is harm. You say Internet Commentator X doesn’t think having a Big Gulp is an important freedom? Does he not see Commentators Y through Upsilon standing right behind him, making the same case against marijuana and hijabs and labour unions and skiing?

This innate prejudice against social engineering for its own sake, which ought to be strong in liberals but is utterly absent in Bloomberg, is paired with an empirical prejudice against social engineering because of the near-inevitable consequences — chief among them being that the institutions created to enforce a for-your-own-good law wander very quickly from anyone’s good but that of the enforcers. I stacked the deck a little by mentioning the Eighteenth Amendment, because it shouldn’t form part of the justification for anything: it took literally six years [for] the U.S.A. to go from “Let’s roust these poor addicted creatures out of the saloon” to “Let’s deliberately poison thousands of Americans to death, that the majesty of the law may be respected”. But the Eighteenth Amendment is worth mentioning, because modern-day prohibitionists never feel the need to accept its lessons or even acknowledge its existence.

When Bloomberg and his deputy mayor for health are ridiculed and their volumetric crusade is ignored, whom do you suppose will end up crucified by bureaucrats in defence of their “nudge’? The logic requires it. If soft drinks really are prematurely killing thousands, and a ban on large containers is the magic answer, how far will be too far when it comes to encouraging compliance? When it comes to “nudges”, we have to recognize a distinction between what is being enforced and the means of enforcement; the mildness and restraint of the former does not guarantee that of the latter.

He also links to this wonderful piece at Hit and Run by Jacob Sullum saying “The mayor’s own pretext for the program had logical holes that Reason‘s Jacob Sullum quickly drove five tanker trucks of frappuccino through.”

May 28, 2012

Playing definitional games to demonize ordinary people as quasi-alcoholics

Filed under: Britain, Government, Health, Liberty — Tags: , , , — Nicholas @ 10:02

Most reasonable people would agree with the notion of using the government’s powers to help “problem drinkers” to drink less. It sounds like a good idea, unless you’re a weirdo libertarian type. Or a “problem drinker”. Building on this, the Scottish government recently passed a minimum alcohol price law with the stated intent of helping “hazardous” drinkers to drink less. But what’s the definition of a “hazardous” drinker? It’s almost certainly not what you’d expect:

A model of the possible effects of minimum pricing by the University of Sheffield has often been drawn upon by the media due to a lack of definite information on the effects of MAP. On the surface, the results look relatively reasonable to someone in favour of minimum alcohol pricing. At 50p per unit, the study suggests that the average ‘harmful’ drinker would be most likely to reduce their intake, followed by ‘hazardous’ drinkers, with ‘moderate’ drinkers suffering least, which, of course, all sounds very fair.

But on closer inspection, it appears as though my own drinking is hazardous. If you’re male and drink more than a pint a day of fairly standard lager on average, yours is too. If you’re female, you’re entitled to even less before you abandon moderation. ‘Binge drinking’ can be any more than 8 units in a single session, or three pints of lager. No, this is not a joke. Millions of British people, who certainly wouldn’t think of themselves as dangerous consumers of alcohol, are in this category. The words ‘hazardous’ and ‘binge’ seem almost bound to bring to mind serious, tabloid-beloved alcohol abuse. This isn’t the case.

[. . .]

Alcohol addiction is a serious social problem. Like all addiction, it’s closely associated with more severe health risks, mortality and crime, and requires the attention of government. Whether price increases help is debatable. An enormous 2009 meta-study of the effect of price on alcohol consumption certainly shows that alcohol consumption is inversely responsive to price. As the cost of alcohol rises, all groups drink less.

But the study also shows that heavy drinkers are significantly more inelastic than others, reacting less to price. This might well seem logical, as the group contains people who are addicted to alcohol. Alcoholics are less likely to consider increases in prices in the same way that casual drinkers do. Will some of the most dependent drinkers simply increase the amount they spend? We don’t yet know. Scotland is about to find out.

So aside from the basic nanny state meddling, the price hike won’t actually produce the reduction in alcohol consumption by the very folks it’s intended to target. It will increase profits for the producers of the cheapest forms of rotgut booze. What’s that old saw about unintended consequences again?

May 16, 2012

Scotland’s latest moral panic, soon to spread to England

Filed under: Britain, Government, Health, Liberty — Tags: , , , , — Nicholas @ 09:00

A spectre is haunting Scotland: the spectre of cheap booze and binge drinkers. The most recent regulatory answer, raising the minimum price of alcohol, won’t solve the problem.

Scotland announced minimum pricing for alcohol this week, at 50p a unit; the price of the cheapest spirits will now rise by almost 50%. It will arrive in England soon, although possibly at the more timid rate of 40p per unit. It will only make a tiny difference, says the government, as it contemplates raising prices for a commodity almost all citizens enjoy (86% of the adult population drink alcohol), and at a time when prices are rising everywhere.

So why bother doing it? The government says it will save lives, even as it announces the speed limit on some motorways will be raised to 80mph, which will cost lives. I am not sure if the deaths created on the roads will be offset by the lives saved from gin, but it seems that more deaths on the roads are acceptable, but more deaths from alcohol are not. Do I smell snobbery? David Cameron says that alcohol “generates mayhem on our streets and spreads fear in our communities” — so I suppose I do.

Minimum pricing is a result of a national moral panic about alcohol, which follows on the trail of moral panics about tobacco and obesity, which are created by the tabloids and their beloved pictures of girls vomiting into gutters with their skirts hitched round their waists; there is a whole crocodile of moral panics, squeezing its way into Downing Street as more important issues are ignored.

[. . .]

Drinking is something that terrifies some but delights many. Drinkers can be ghastly, but so can politicians, and so can sober politicians. Minimum pricing comes from an ancient place – the desire for a neat society – and it expresses Cameron’s desire to appear to be doing something, while he does nothing elsewhere. Where one stands on minimum pricing depends entirely on whether you believe it is a person’s unalienable right to get shit-faced drunk at the market price, no matter what your income. When so many rights are threatened, who would dispute it?

May 14, 2012

Scottish minimum alcohol pricing: “Health fascism is back with a vengeance”

Filed under: Britain, Bureaucracy, Government, Health, Liberty — Tags: , , , , — Nicholas @ 09:30

A released statement from Sam Bowman, Head of Research at the Adam Smith Institute, responding to Scotland’s minimum alcohol price decision:

“Minimum alcohol pricing is a miserable, Victorian-era measure that explicitly targets the poor and the frugal, leaving the more expensive drinks of the middle classes untouched. It’s regressive and paternalistic, treating people as if they’re children to be nannied by the government.

“To make things worse, all signs suggest that the minimum price will be successively raised once it’s in place. This is what happened in the UK with alcohol and tobacco taxes, which are now among the highest in the world. It’s like boiling a frog – bring in a low minimum price that only affects the most marginalized part of society, the poor, and raise it gradually every year without people noticing.

“The reality is that Britain does not have a drink problem. The definition of “binge drinking” has been redefined so that a grown man drinking more than two pints of lager is considered to be “binging”. The number of diseases defined as “alcohol-related” has tripled in the last twenty-five years. In fact, we drink less than we did ten years ago, less than we did one hundred years ago, and far less than we did in the 19th Century. Hysteria about drinking alcohol is a red herring invented by the health lobby. Health fascism is back with a vengeance, and minimum alcohol pricing is just another brick in the wall.”

May 8, 2012

Now available for download: License to Work

Filed under: Bureaucracy, Economics, Government, Liberty, USA — Tags: , , , , — Nicholas @ 10:14

The Institute for Justice has released a new study, License to Work: A National Study of Burdens from Occupational Licensing, which shows the negative effects imposed on (especially) poor and minority workers across the United States:

The report documents the license requirements for 102 low- and moderate-income occupations — such as barber, massage therapist and preschool teacher — across all 50 states and the District of Columbia. It finds that occupational licensing is not only widespread, but also overly burdensome and frequently irrational.

On average, these licenses force aspiring workers to spend nine months in education or training, pass one exam and pay more than $200 in fees. One third of the licenses take more than a year to earn. At least one exam is required for 79 of the occupations.

Barriers like these make it harder for people to find jobs and build new businesses that create jobs, particularly minorities, those of lesser means and those with less education.

May 4, 2012

Gordon O’Connor on the abortion debate

Filed under: Cancon, Government, Health, Law — Tags: , , , , — Nicholas @ 13:04

A fascinating moment in the House of Commons, as related by the editors at Maclean’s:

And then Gordon O’Connor rose from his seat on the government side, immediately behind the Prime Minister. O’Connor, a retired brigadier-general, is the chief Conservative whip — the living symbol, in other words, of the ministry’s discipline and unity. His words bit with surprising sharpness. “The House of Commons . . . is not a laboratory,” he admonished Woodworth. “It is not a house of faith, an academic setting or a hospital. It is a legislature, and a legislature deals with law.” The Criminal Code definition of a human being, he said, is not a medical one; it is a purely legal test defining the moment when personal rights receive protection independent from those of the mother. It is quite reasonable, he added, that this should happen at the moment of their physical separation.

O’Connor went further. He denounced the oft-repeated right-wing heckle that abortion is “unregulated” in Canada. It happens to be absent from the criminal law, O’Connor observed, but the provinces regulate their medical professions, and the doctors in turn regulate their own conduct. The provincial governments and the medical colleges have agreed that since abortion cannot be abolished, it ought to be provided safely by, and to those whose private judgment allows for it. “The decision of whether or not to terminate a pregnancy is essentially a moral decision,” said the whip, “and in a free and democratic society, the conscience of the individual must be paramount and take precedence over that of the state.”

O’Connor concluded by reaffirming that the Conservative determination not to reopen Canada’s abortion debate is unwavering. “Society has moved on and I do not believe this proposal should proceed,” he said. “As well, it is in opposition to our government’s position. Accordingly I will not support [this] motion. I will vote against it and I recommend that others oppose it.” [. . .]

What is interesting about O’Connor’s brief speech is that it frames reproductive choice as a matter of small-C conservative principles. He appealed not only to libertarian considerations of individual conscience, but to the idea that regulations should be made at the political level closest to the citizen. Viewed in this light, the Harper rule against legislating on abortion is not just a convenient, cynical means to social peace and election success. It suggests the influence within the government caucus of a Charter-friendly breed of conservative, one whose first instinct is not always to “stand athwart history yelling, stop.”

April 26, 2012

The public choice analysis of the “Jeremy Hunt affair”

Filed under: Britain, Government, Media, Politics — Tags: , , , , , — Nicholas @ 08:18

On the Adam Smith Institute blog, “Whig” explains why the Jeremy Hunt affair should be no surprise to anyone, regardless of their party affiliation:

First of all, it is salutary to remember that this is not a party political issue. As evidence to the Leveson Enquiry itself shows, politicians are drawn to newspaper proprietors and editors like flies to the proverbial. The two have a symbiotic relationship with each other, and always have done. Clearly this relationship is the result of a classic public choice style problem — politicians have power but need votes and newspaper editors can deliver votes in exchange for a chance to influence how that power is directed. Of course, this is a very reductive description of the relationship but that is what it boils down to.

Such a relationship is evidently corrupting and open to the exploitation of special interests at the expense of general ones. How should we prevent this? Whilst party politics calls for the minister to fall on his sword, such an action will hardly prevent future occurrences. The general tone of public discourse suggests the introduction of rules, guidelines and procedures on ministers with greater bureaucratic control and less personal control by the minister. In many ways this represents the general trend of constitutional developments over the past 100 years or so. Powers should be vested in ‘disinterested’ civil servants or, better yet, in ‘independent’ Quangos like OFCOM or the Competition Commission, rather than politicians.

The bureaucratic solution, however, is no more acceptable — as any fan of Yes Minister will confirm. Aside from the issues of democratic accountability such developments raise, we should remember that civil servants and bureaucrats are human beings and have a series of vested personal and ideological interests of their own. Bureaucratic rule-making is just as susceptible to corruption as ministerial rule-making. This is especially true in the case of newspapers, which are extremely well-placed to use their influence in order to promote their own interests. Again, the Leveson Enquiry shows us exactly this situation: journalists allegedly entering into corrupt relationships with police officers.

April 25, 2012

Complaint submitted to CRA over the David Suzuki Foundation’s charitable status and partisan political activity

Filed under: Cancon, Law, Media, Politics — Tags: , , — Nicholas @ 08:56

It’s been an open secret for years that some organizations with charitable status under the Canada Revenue Agency’s rules are stepping over the line with regard to partisan political activities. A complaint has been lodged with the CRA over the David Suzuki Foundation on these grounds:

The David Suzuki Foundation on Tuesday became the target of a complaint to the Canada Revenue Agency, just days after its namesake co-founder stepped down amid heightened tensions between environmental charities and the Conservative government.

EthicalOil.org, a non-profit organization that promotes oil from Canada and other democracies, sent a letter to the agency asking it to investigate whether the David Suzuki Foundation is breaking rules that pertain to political activity. Registered charities are allowed to devote only a small fraction of their resources to political activity, although they can never be partisan.

“If you find the Suzuki Foundation is in contravention of the CRA rules, then we request that you consider whether the Suzuki Foundation should have its charitable status revoked or otherwise be sanctioned,” EthicalOil.org said in its 44-page letter, which was drafted by Calgary-based JSS Barristers and obtained by the National Post.

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