Thursday, May 11, 2006

The case against business subsidies

When the Saskatchewan government announced a $1.5 million subsidy to the bankrupt World Wide Pork in Moose Jaw, the news was received with open arms in many circles.

The employee union was happy because it gave them hope that 200 workers might continue to work in Moose Jaw at jobs they knew and liked. The government was happy because the deal essentially threw a lifeline to one of the biggest private employers in Moose Jaw. The Opposition Saskatchewan Party applauded the move saying it helped maintain jobs in the much-loved agri-food business.

But it is really a good move?

Read the rest...

29 comments:

Kelly J Gessner said...

"some business owners become so reliant on government assistance they build expectations of handouts into financial plans."
You couldn't have described agriculture better if you tried, David. But hey, if it's good for farms, why not pork plants, pulp mills or anything else?

R.S. Porter said...

Where is all this "CTF is pro-agricultural subsidies" coming from?

Kelly J Gessner said...

If you are not in favor of ag subsidies,rs, then oppose them in your publications and on this blog. Do so overtly, explicitly and unequivocally.

Spakosky said...

The anti-ag statements are part of an orchestrated NDP attack against the CTF, farmers, SK Party and any others that oppose the NDP. The NDP hope to secure their urban and FN constituencies by using agriculture as a wedge issue.

Also, I suspect that "kelly" knows of what she speaks of when she refers to pulp mills; their have been certain signals, including recent Crown Corp work at the Weyco site, that hints at production resuming, with government help, before the next by-election.

Kelly J Gessner said...

You give me too much credit, spakosky. I am but a hard-working taxpayer who would like a little consistency from those who sanctimoniously preach the gospel of free-market fundamentalism.

Kelly J Gessner said...

"the CTF,farmers, SK Party and any others that oppose the NDP" I thought the CTF were non-partisan. Another non-truth on their (your) part?

Spakosky said...

1) I don't speak for the STF or any other organization, I am expressing my opinions, that are the product of my own mind, based upon several sources of information;
2) your comparison to ag subsidies is not fair: it would only apply if ALL SK hog-producers were being bailed out, and if the reason was, in part, because domestic consumers were heavily subsidized and protected against high prices (for pork), and external competition was being heavily subsidized.

As it stands, it is not a fair critique. And ag is being used, increasingly, IMHO, as a distraction from the real problems. The NDP have used fear in past campaigns, and I think that they are now increasingly fomenting loathing for agriculture, and the only reason is to: shore up their urban and FN support, and to attack their "perceived" enemies, be they a rival political party, a NGO or whatever.It does not matter to them that it is not fair; it does not matter to them that it is a corrosive policy that weakens and divides the province; all that matters is power.

Alberta Conservative said...

One of the problems with business subsidies is they favor specific companies and not industries in general. Farm subsidies are more evenly spread and do not hinder competitive market forces from improving farm productivity on the national level. On the international level farm subsidies are a stop-gap measure to compete with heavily subsidized EU and US farms. The presence of farm subsidies also has detrimental effects on farmers and economies in the third world.

David MacLean said...

Zeker, you can have your opinions and I'm alright with that. But when you keep accusing other people of being sock puppets when I know they are not, I'm going to delete your comments.

R.S. Porter said...

If you are not in favor of ag subsidies,rs, then oppose them in your publications and on this blog. Do so overtly, explicitly and unequivocally.

Who exactly do you think I am?

I have "explicitly and unequivocally" been against agricultural subsidies; all you have to do is read my comments. It seems that you think I'm a CTF staff member, I am not. However, if Mr. MacLean wants to hire me, I'm most certainly willing.

Zeker said...

Well we wil try it one more time, even though DM keeps deleting everything I post here.

r.s. porter. says:

Where is all this "CTF is pro-agricultural subsidies" coming from?

Well David Maclean will issue a press release and/or make a blog comment any time the governmeny of Saskatchewan spends 1/2 a million on anything like advertising or world wide pork

But the 1.5 BILLION that has been spent on agricultural policies over the last 2 years has never been mentioned by the CTF. Ever.

When you are a 10-blog-a-day maniac and you are silent on an issue for two years that is fine - but then one can only assume you support it.

David can prove me wrong by saying on the record that he is opposed. but I won't hold my breath

(and this comment will be deleted quite soon, so read quickly)

Spakosky said...

Hey Zeker, don't forget softwood lumber! Or the fishery! Or the arts! Or handicapped parking spaces! All of these, as far as I know, have thus far been spared CTF censure.

Farmer Joe said...

Looks like some circular arguments have been forming. If the CTF is too consistent they get labeled as extremists, if they act more moderately they get labeled as inconsistent.

Catch-22

Farmer Joe said...

Spakosky, I do believe you are on to something with the NDP trying to use farmers as a wedge issue to shore up urban support.

The Manitoba dippers have certainly been putting the farmers there through the ringer.

Zeker said...
This comment has been removed by a blog administrator.
Zeker said...

Spakoski says:

"Hey Zeker, don't forget softwood lumber! Or the fishery! Or the arts! Or handicapped parking spaces! All of these, as far as I know, have thus far been spared CTF censure."

Yes they have, and from that I conclude that the CTF supports fisheries and handicapped parking spaces. (And good for the CTF)

This proves my point actually. The CTF does not oppose spending money on hadicapped parking spots so they don't critisize the government for spending money on it.

Same with agricultural subsidies. They support them so they don't crtizise the government for doing it.

I agree with spending money on both handicapped parking spots and agricutural subsdies. But I don't claim to oppose all sorts of government spending like the CTF.

I am consistent and rational. The CTF is rediculous for opposing things like the world wide pork bailout but not agricultural subsidies.

Spakosky said...

Zeker, I don't know if you are being deliberately obtuse or simply do not understand: it is picking one player out of a group for preferential treatment that is objectionable; there are numerous pork plants in SK (Harvest, Mitchells, Thompsons etc...), but only this one, in an NDP riding, is being bailed out. And further, other provinces do not need to resort to this blatent pork-barrelling. You are not consistent, you are not rational, in fact, your are being "rediculous".

Spakosky said...

Even worse, Zeker is being REDiculous!

Zeker said...

Let me guess, the fact that some farmers get subsidies while others don't isn't the same thing at all - right?

The fact that large corprate farms get a larger percentage that the samll familiy farms is competly different, right?

And as for other provences not ever giving out corp. subsidies - name the province that doesn't.

Perhaps you meant just in pork.

Well let's look at Alberta. Not only do they give Maple Leaf in Edmontion a 22 million bailout but they have other subsidy programs as well.

Maniotba is in the same boat.

I guess PEI with no pigs doesn't have these subsidies so you are sort of right.

Spakosky said...

Ag subsidies are applied to the entire industry; there are not separate or special programs for separate farms. The same programs are applied accros the board. It is either disingeneous or dishonest to suggest that there is.

And I don't believe that AB is bailing out M.L., or has anytime soon. I don't believe that other provinces than SK would be stupid enough to give millions to a specific operation and ignore the rest of the industry.

Once again, the problem is bailing out one particular failing enterprise (in an NDP riding) at the expence of the industry as a whole and all taxpayers.

Zeker said...

*sigh* learn some hisotry before commenting spakosky

"And I don't believe that AB is bailing out M.L."

This was formerly the Gainers packing plant in Edmonton, scene of one of the longest and most violent labour disputes in Albera History. It was the UFCW v.s. the owner Peter Pocklington.

Pocklington was eventually bailed out by his Tory pals in the Provincial government, the taxpayers paid $22 million to keep Gainers afloat. After the strike when Pocklington couldn't pay off his debts to the Alberta government, they seized Gainers and sold it to Burns Foods of Calgary

Again, I'm not saying this was right or wrong, but to say that other provinces don't do it is just incorrect.

David MacLean said...

In the EARLY 80s Gainers was bailed out -- that's true. In the 90s, however, Alberta passed the business subsidy elimination act -- making tomfoolery like that illegal.

Kelly J Gessner said...

So what are you saying spakosky, subsidies are OK if they are industry wide? The position of the CTF is that they are against subsidies period. And David, the AB gov't. still engages in the tomfoolery of subsidizing farm businesses.
Industry wide subsidies are more egregious than targeted subsidies, because tax dollars get showered on successful as well unsuccessfull enterprises. This is not only wasteful but very expensive and only ends up feeding the cycle of dependence, as we see in the ag sector.
Over the last 20 yrs., after all the billions SK taxpyers have thrown at agriculture, after 20 yrs. of whining that last year was the worst since the great depression, and this year is worse than the year before, cultivated acreage has increased by over 40%, while according to apas, the industry is in worse shape than ever, while asking for a $3.4 billion taxpayer "investment." This is insane.
Spakosky, David Maclean, CTF, how can you support this garbage?

Spakosky said...

I for one support programs that equitably protect Canadian industries in a time of need, expecially in the face of unfair foreign subsidies.

I do not like any industry as a whole being villified for selfishly partisan political purposes.

Kelly J Gessner said...

In time of need? This has been going on for decades. The "need" is perpetual. The more that is given, the more that is demanded. Conservatives like to talk about choice. Well, give me choice. If you want to fund this crap, do it out of your own pocket.
And I'm not villifying an industry, I'm villifying BUSINESS SUBSIDIES and the HIGH TAXES required to sustain them, and I'm villifying the hypocrisy of you and the CTF when you preach one thing and practice another for partisan purposes.

Spakosky said...

last time I checked, if anyhting, farmers pay TOO MUCH in property taxes in SK: many farmers I know actually lost money on CAIS: becasue they needed an accountant to figure out that they did not qualify. And these programs have not been going on for decades, and times change, and almost certainly the family farm will survive.
Agriculture is worth billions to the SK economy: input costs keep going up, and farmers generally pay their bills, lately just hoping to break even.
I'm not a farmer, but I respect people for working hard and contributing to SK. And I still beleive that your anti-farmer animus is a deliberately strategy, a ploy to distract, and indeed, it is working, because the real issue here is pork-barreling for one single plant in an NDP riding (and excluding many others, such as Harvest, Drake, Thompson, etc..) and not whether farm programs are unfair. You seek to excacerbate the rural/urban split in SK for your own destructive partisan purposes. Meanwhile, farms keep disappearing, the SK population keeps dropping, the dependancy ratio worsens, and the size of the provincial government is growing.

Kelly J Gessner said...

Farm subsidy programs have indeed been going on for decades. 20 yrs ago we had the thanks a billion, Brian bailout. Since then we've had nisa, grip, aida, cfip, cais, ad hoc, and who knows what else and who knows what else came before. Farmer's vehicle insurance is subsidized, as is their fuel. They pay substantially less income tax than other taxpayers, they have preferential tax treatment for capital gains. In 1991 the cost of direct subsidies in SK was $600.00 per capita (in '91 dollars) Every taxpayer in SK has taken thousands and thousands out of their own pockets and given it to their neighbors and what do we get in return: Grant Devine and waiting in the wings, Brad Wall and the Sask. Party to pick up where Devine left off. That's the genesis of the rural/urban split.
So farmers work hard. So do I. So does everybody I know. What is the justification for farmers forever availing themselves of other peoples labour?

Spakosky said...

Kelly, I think that you have a bad attitude. I presume that your numbwers are off. It is clear that you show great disrespect for people that risk their money and even their lives to grow the food we eat. You show great disrespect for an industry that built this province. Everything you say confirms to me that you are part of a deliberate NDP strategy of fear and villification: farmers will be (one of) your scapegoats as you try to shore up urban and FN (and university student!) support.
Shame on you for failing to condemn the world-wide pork-barreling!

Kelly J Gessner said...

You presume wrong. You got any numbers to substantiate your claims, or just right-wing blather? Taxpayers are the ones being disrespected by farm subsidy extortion. And taxpayers are ill-served by the CTF. The CTF are not part of the solution, they are part of the problem.

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