See Gary Spend, Part II

Dan Lett has a column today, where (if I can boil it down) he essentially says the new legislation is a non-issue. However, he eventually makes the following point:

Even if the NDP wanted to require the province to balance its consolidated budget on a rolling, four-year basis, it could continue to balance the operating budget on an annual basis if only to save itself from criticism.

This is exactly what they should have done. Not to save themselves from criticism, but to give taxpayers confidence that they won't spend us into oblivion if Hydro has a few good years. The NDP has done little to give us confidence that they can control their spending -- for example, drawing down the Fiscal Stabilization Fund even though the economy was in full flight and transfer payments were increasing.

Hydro has only lost money once in the last decade. This IS essentially a free pass to increase spending, Mr. Lett.

***

I went to the PC Manitoba web site to see what they had to say about this bill, and found ... nothing! There is nothing but one month-old press releases under the "Current News" and "Where We Stand" links, and there is a tiny link to an audio clip that gives no detail about the bill. WTF? If you're going to get all fired up about a bill and ask people to speak to the government about it, why don't you have something on your web site? Explain to us exactly why you think it's a bad bill!

See Gary Spend

I am not a legislation geek, but I heard about a proposal by the NDP to meddle with the balanced budget legislation on the Great Canadian Talk Show. Well as a concerned citizen, a fiscal conservative, and somebody with an economics background, this caught my attention because responsible financial management is extremely important for any government. Anything that can give the NDP even more leeway for spending is a scary prospect. So, while I also happen to be the laziest blogger in Winnipeg, I actually felt compelled to read the bill.

At first glance it doesn't look that bad, but here's the thing: the balanced budget isn't based on government operations anymore, but on the "government reporting entity" which includes crown corporations. Manitoba Hydro, for instance, while heavily in debt itself, does turn a profit most years ($122m in 2007; $415m in 2006). The government can use these profits to offset deficits in core government operations. In other words, the government can leverage the crown corps to spend more then they could under the current legislation.

This government has a serious spending problem and this legistation is not going to help. I think we need to bring in a professional:



also read: NDP bill crosses line from bad to awful

links: old bill / new bill

Down with Big Taxi

The big two taxi cab companies in town are at it again: trying to crush any competition to their duopoly. Competition is what makes our economy go 'round. It's a good thing. Open up the damn market and let it regulate itself. If some drivers want to start a taxi co-op, let 'em. It can only lead to improved service for the public, which is the bottom line after all.

Last time we saw Big Taxi get its panties in a knot, it was to protest an airport shuttle proposal. Imagine that -- an airport shuttle in a city that takes pride in being a transportation hub. What an outrageous idea. People like to throw around the term "World Class" in Winnipeg. Something as simple as an airport shuttle would do a lot more towards making Winnipeg a World Class city than any interpretive centre for a non-existent fort.

There is no good reason for this over-regulation of the industry. In fact, ditch the Taxi Cab Board completely and replace it with some basic regulations (minimum standards for cabs, etc.) and let the market work. It will be ok. Trust me.

Recommended reading: This column from Peter Holle.

Is that a fly in your water, or are you just crazy?

There have been a number of lawsuits over the years in which people have been rewarded for being unlucky, weak, and/or just plain stupid. The most famous probably being the $3m McDonalds coffee incident. This is a kind of reverse-Darwinism where the genetically deprived prosper, and ordinary folks suffer because of higher insurance rates and reduced share values.

As one of the ordinary folks (I hope) I am therefore pleased to read that a similar case was recently overturned by our Supreme Court:

A hairdresser who claimed the torment of finding dead flies in his bottled water wrecked his sleep, his sex life, his business and his ability to take showers has lost his bid for psychological damages in a ruling Thursday morning in the Supreme Court of Canada.

The decision means Martin Mustapha loses the $341,000 award he won from Culligan Canada after convincing a judge that he suffered enduring distress when he noticed one whole fly and another half one in an unopened bottle of drinking water [link]

I find it ironic that seeing a fly in a bottle of water cause him to stop taking showers, which no doubt attracted more flies. Seriously, how does somebody that sensitive make it into adulthood not confined to a straight jacket?

Inflation

My reply to James, since he does not allow comments on his blog:

Is the Government lying about inflation ?

No.

It is true that some things have gone up more that 2%, which is the Bank of Canada's target rate. Orange juice is one. I used to buy cans of frozen OJ on sale for a buck. Now I have to steal it from my neighbour. However, other things are cheaper. You can buy a brand new car for $10,000 now. When was the last time you could do that? Electronics always go down in price. Milk never changes much. Frozen dinners, meat, etc.. none of it is changing much.

Inflation is not 12%.

Something that cost $100 in 1964 would cost $690.80 this year, a whopping 590.80 % increase in just 44 years !

That may be, but that's only 4.6% inflation, and that period includes the mid 70's when Trudeau had to implement wage controls to try to rein it in, and interest rates sky rocketed.

I don't care what anyone says, I am keeping a majority of my savings in silver and gold. Over time, they have held their value.

If you take one thing away from this post, let it be this: DO NOT PUT YOUR MONEY IN GOLD AND SILVER! Especially not now! Seriously, you would have to be the Evel Knievel of investors to sink your money in something with a chart like this:

Sure, if you bought gold in 2000 and sold now, you would make out like a bandit. But if you bought gold in 1980 and sold 20 years later you would have lost half your money in nomimal terms, meaning that you would have lost more when taking into account inflation. (A lot more if inflation was 12%).

Sure, take a few thousand bucks and play the market, or shift 10% of your money into bullion if you sniff a recession around the corner, but fer gawd's sake, don't risk what you can't afford to lose.

When inflation happens, it only benefits large companies. Because prices always go up before wages.

Inflation does not benefit (most) companies because it causes interest rates to rise which makes the cost of borrowing more expensive, and all large companies borrow money. Lots of it.

Do prices always go up before wages? It's a chicken and egg thing, but sometimes wages go up more than inflation. Just ask the nurses about that.

Woo hoo! Long weekend. I cut outta work a little early today. I'll have to check out Darcy's Friday Night Blues and Beer selection of tunes a little bit later, because I've got international hockey on the tube right now. Canada up by two after an awsome goal by Green. I've been trying out a few new beers lately, but have gone back to one of my fav's today:


I've got to say that I'm I a pretty upbeat mood, despite all of the devastation in Asia and the fact that killing a hooker nets you only one day in jail (if you beleive the headline). I am formulating some thoughts on Waverly West and will stick them up here soon. There have been some stories lately about the insatiable appetite for housing, which makes me wonder why we can't push through geothermal energy and proper road infrastructure as originally planned. There's more than one way to reach equilibrium in a market, but the little ticky tacky house makers will tell you that there's only one: more quantity.

Anyhow. Enough about that. Time to relax and watch Canada bury the Swedes. Have a good long weekend everybody.

The nail in the coffin

I don't comment much on US politics, but I just want to say that this is the nail in the coffin of Hillary's hopes and dreams (at least for 4 years):

Former Democratic presidential candidate John Edwards endorsed Sen. Barack Obama on Wednesday at a campaign event in Grand Rapids, Michigan.

Edwards will get the VP ticket that he was hoping for, and Obama will get the white middle-class draw that he was looking for. Hillary will get a loan to pay for her campaign bills then take a seat on the bench. 48 hours tops before she calls it quits.