Friday, February 21, 2020

Feeling Buffaloed Yet, Alberta?

So, yesterday Michelle Rempel, and 3 other CPC MPs from Alberta put their names to the so-called "Buffalo Declaration".

The name "Buffalo" is a nod to an early proposal to create a province called that from the region of the Northwest Territories that is now Alberta and Saskatchewan.

Synopsis of the Buffalo Declaration

The Buffalo Declaration is a large-ish document, pushing some 13 pages of fairly dense typewritten text organized into 3 major sections.  The first section is a list of grievances, the second part lays out a group of demands, and the third part is a bit political apologetics self-justifying the need for this document. 

For the most part, the list of grievances is a rehashing of the usual complaints that we hear from "Western Separatists", with the addition of one or two novel aspects like an attempt to claim Alberta as a "distinct culture". 

They then go on to propose a series of constitutional changes which they argue would remedy the problems in the first part.  Much of this reminds me of René Lévesque's "Sovereignty-Association" concept.  

The Grievances

The document lays out several grievances: 
  1. Alberta has never been an equal participant in confederation
  2. Alberta is a culturally distinct region
  3. Alberta is physically and structurally isolated from Canada's power structures
  4. Alberta is treated as a colony
The first grievance is basically a grab bag of complaints reaching all the way back to the acquisition of the lands from the Hudson's Bay Company.  The authors then proceed to engage in a highly selective reinterpretation of history, conveniently leaving out key details, and transitioning from one complaint to the next while never bothering to explore whether a particular issue had been dealt with. There are several examples of this, but the most egregious being a failure to acknowledge that the 1980 constitution negotiations actually directly addressed a lot of the land and resources issues they talk about.  As one might predict, they also go on to rant about Pierre Elliott Trudeau's much maligned National Energy Program.  All in all, it's basically a rehashing of the same old issues that have been whipped up from time to time for political gain.  

The second grievance is more interesting, as it attempts to cast Alberta as a "unique culture" within Canada.  In this section they accuse the Canadian Federal Government of being "colonial" towards Alberta, and then go on to argue that Albertans are a more "independent" lot than the rest of Canada.  Perhaps the great irony here is they inevitably point to our resource economy here as a key part of our "unique heritage", and in doing so return to the usual basis of Western Separatism - economic anxiety.  

The third grievance is that Alberta is not connected to the power structures of Canada.  This is largely the usual "but all the power is concentrated in Ontario/Quebec" issue - which they refer to as the "Laurentian Elites" in the document.  There's a laundry list of nonsense in here, ranging from "not enough Senators" (Canada's Senate is regional, not population driven), the usual complaint about how much Alberta "contributes" to the rest of Canada through taxes, and a broad complaint about how Albertans have to *gasp*TRAVEL*gasp* to get to Ottawa if we want to lobby the government - funny - I don't hear BC bitching about that.  Also, apparently we're "underrepresented" in the Federal bureaucracy.  Odd - I thought the bureaucracy's job was to execute the government's agenda?

The last complaint is that we are "treated as a colony" by "The East".  Again, it's largely a complaint about money (it's odd how that keeps coming back up in Alberta's grievances).  "We send so much to Ottawa and get nothing back", etc.  The reality of why Alberta "sends more to Ottawa" has to do with having higher incomes - this has been explained time and again.  Proportionately, we send as much to Ottawa as any other province - there is no "lives in Alberta, pay more" clause in the taxes.  If you make $200K in Alberta, you pay the same federal taxes as you would in Ontario.  

Largely, as you might expect, the grievances come down to the usual assortment of economic anxieties that have long fuelled western separatist grievances.  This particular version adds a half-baked attempt at making it a "cultural" matter, but when your cultural issue turns out to be one of money as well, that isn't exactly persuasive, is it?  

The Solutions

The first part of the "solutions" is basically a giant whine of "WE WANT AN APOLOGY" (for the NEP, of all things).  

Then they go on to the following:  

I highlight the last two of these because they basically add up to being another NEP.  I'm not sure that the authors even realize that is what they are demanding, or that their demands are self-contradictory. An open market economy that "prevents foreign energy from displacing Alberta energy" is in fact not an open market, is it?  

I don't even know where to start with this one.  What "western based journalists" are there?  Most of our journalism is concentrated in the hands of a handful of powers (e.g. PostMedia), which aren't based in Western Canada (or Canada at all).  Again, this would require completely restructuring the media landscape - undoing the massive consolidation that started with Hollinger.  

Closing Thoughts

This manifesto is little more than a rehashing of complaints and grievances that so-called Western Separatists have been bandying about for decades.  They have added a few more pieces for flavour, and tried to whip in some more contemporary issues, but at the end of the day it's largely the same old economic anxieties driving this.  

The solutions they propose cannot solve the actual structural problems that are afflicting Alberta's economy today.  We could build all the pipelines these people demand, and it would make no difference - the oil and gas industry is in transition.  Alberta's problems aren't a result of Canada's federal structure.  The problems we face today are a direct result of the energy industry changing dramatically, and the province's abject failure to recognize that is happening.  The blame for this resides firmly in the offices of Premier Kenney, who among his first acts was to dismantle every government program which wasn't solely focused on the oil patch.  Since then 19,000 jobs have vaporized from this province.  

The Buffalo Declaration is a political distraction meant to deflect attention away from the damage being done to this province by the current UCP government.  

Sunday, December 15, 2019

And The War For Control Over The CPC Begins

With Andrew Scheer announcing his resignation as CPC party leader this week, the war for control over the party begins in earnest.  Make no mistake, this is not a fight between individual candidates espousing different visions for the party.  This is about the factions within the party trying to gain (or maintain) control.

In particular, the Social Conservatives (SoCons) have their eye on "the big prize" - reinforcing the base of control and power that they asserted when they pushed Andrew Scheer up the middle as their second choice behind Brad Trost.  You would think that a group whose beliefs and policies have cost conservatives elections - even in Fortress Alberta - would find themselves on the outside by now.  But, we have to remember that this isn't how SoCons operate - they operate from a well of deep, uncompromising belief that they have the solution, and they are willing to spend a very long time organizing to achieve that goal.

The first volley in that war was published in the National Post yesterday.  Titled "How Social Conservatism Done Right Can Actually Help The Tories Win Again", it is an intriguing view into some of the key mistakes that SoCons have been making for years.  Let's take a closer look.

Monday, December 02, 2019

Fraser Institute Claims That Alberta Public Sector Employees Are Overpaid

The Fraser Institute is notorious for pushing a hard right, neo-liberal, approach to economic and fiscal policy.  In my experience, their methods are at best sloppy analysis and at worst outright twisting to push a particular policy agenda.

This past week they have published a battery of "reports" that they claim show the public sector workers are being paid considerably more than their peers in the private sector.  They have produced these reports for Alberta, Ontario, and British Columbia (so far). Presumably, this is because once you have set up the analysis for one province, it's pretty much boilerplate to apply it to other provinces with similar datasets available.

For the sake of simplicity, I will focus my commentary on the Alberta version of this report.

Saturday, November 16, 2019

On Williams' Defence of Bill 207

In today's Calgary Herald, UCP MLA Daniel Williams has published a defence of his recently introduced legislation on Bill 207.

I've already discussed my concerns after reading the First Reading draft of this legislation here.  The head of the Alberta Medical Association has stated that the legislation is unnecessary, and the troubling breadth of this legislation has been discussed here.

However, I do think it's worth exploring Mr. Williams' comments about his bill and to examine them more carefully.

Friday, November 08, 2019

Alberta's Bill 207 (Conscience Rights)

Now that Bill 207 has been tabled in the Alberta Legislature, we can look at the bill and its implications more closely.  What follows here is my personal analysis of this bill and the potential implications for Albertans.  Since it isn't a very long bill (8 sections, 8 pages of legislation), I'm going to go through it one piece at a time.

I will foreshadow my comments with a general statement that this bill is extremely broad in its wording, and that has significant implications for Albertans accessing health care.

Sunday, March 10, 2019

Thinking About SNC-Lavalin

The whole SNC-Lavalin business is a mess.  It contains a nasty combination of commercial, criminal, and political matters that need to be teased apart to make any sense of it.

Before I go into this in any depth, I want to be absolutely clear here:  I do not believe that the Liberal government has handled this situation well at all, nor am I here to defend the actions of any singular party.  This post is mostly an attempt to tease apart the various threads of the matter so that I can make sense of it all.

Sunday, February 10, 2019

On Deferred Prosecution Agreements

With the uproar over SNC-Lavalin this past week, I decided it would be a worthwhile exercise to familiarize myself with this legal construct that the government introduced with Bill C-74 (2018 Budget Implementation).  Because this is a large chunk of the legislation, I'm not going to do a detailed analysis of its clauses.  Instead, I will refer to a number analyses in various legal journals that are readily available online.

I will endeavour to be objective in the first part, and reserve my personal comments on the matter for afterwards.

What Is A Remediation Agreement (Deferred Prosecution Agreement)?

Dentons provides the following summary of the structure:
One distinctive feature of the Canadian DPA regime is the label attached to it. Specifically, the proposed legislation announces that Canada’s version is based on “Remediation Agreements,” eschewing the conventional “DPA” label adopted by other jurisdictions. However, it is clear from the precise provisions of the legislation that, whatever the label, the framework is fundamentally similar to DPA regimes adopted in other jurisdictions, most notably the UK. 
The core elements are as follows: 
  • Remediation Agreements will be available for a range of economic crime offences, including almost the entire gamut of fraud and domestic bribery offences contained within the Criminal Code, as well as—notably—offences under the Corruption of Foreign Public Officials Act;
  • Only “organizations” (as already defined within the Criminal Code) will be able to take advantage of Remediation Agreements – they will not be available to natural persons;
  • The decision as to whether to offer a Remediation Agreement to a corporate accused will be made by the assigned prosecutor, subject to the Attorney General’s consent;
  • The prosecutor will be required to take certain factors into account when deciding whether to offer a Remediation Agreement, including the following (non-exhaustively):
  • How the impugned conduct was brought to the attention of authorities;
  • Any efforts by the organization to remediate the wrongdoing and address deficiencies in its compliance program;
  • Whether the organization has taken disciplinary action against employees involved in the impugned conduct, and whether it is willing to identify individual wrongdoers to the authorities;
  • The gravity of the conduct, as well as any history of offending by the organization;
  • "Any other factor the prosecution considers relevant,” thereby giving the prosecutor considerable latitude to take account of specific circumstances.
This provides a fairly good summary of what the basic construct is.  It appears, superficially to be designed to create an environment where it becomes beneficial to the corporation to cooperate with a corruption investigation, better enabling access to the perpetrators of whatever acts have come under suspicion, rather than attempting to prosecute the entire corporate entity as a whole.

Dentons' analysis goes further to describe what the agreement must contain, and some of the implications of these agreements.
The proposed legislation also sets out the mandatory terms of any Remediation Agreement, which most notably include (summarily and non-exhaustively): 
  • An agreed statement of facts and an acknowledgment of wrongdoing, to be made publicly available (save in prescribed exceptional circumstances)
  • Obligations to fully cooperate in any investigation relating to the alleged conduct, including by providing testimony to support related prosecutions (such as against individuals)
  • Certifying that information disclosed to Prosecutors in connection with the offence is both complete and accurate;
  • An obligation to forfeit any benefit or proceeds derived from the wrongdoing (or to otherwise deal with such benefits/proceeds as may be directed by the Prosecutor);
  • Payment of a penalty to the Government, as well as an additional victim surcharge of up to 30% of such penalty (except in CFPOA cases, as the CFPOA makes no provision for victim surcharges to be applied);
  • Payment of “reparations” to any “victims” (as defined), or if no such payments are proposed, the reasons why they are not considered appropriate;
Given that the required terms include not only payment of a penalty, but also require forfeiture of any benefit (which could include the entire proceeds from a tainted contract or concession), as well as payment of potential victim reparations or restitution, the potential sum payable for a given DPA is potentially vast. 
While not a mandatory requirement, the legislation also contains a framework for an independent monitor to be appointed to oversee the organization’s compliance and remediation efforts throughout the term of the DPA. This potential requirement is likely to incentivize companies to demonstrate to prosecutors that proactive and comprehensive remediation and compliance enhancements have already been carried out, such that ongoing monitoring is unnecessary. 
As expected, the Canadian regime also provides for a significant oversight role for the court, similar to the UK DPA regime. Specifically, Remediation Agreements will require the approval of a Superior Court, which must be satisfied that the DPA is in the interests of justice and that the terms are reasonable and proportionate to the wrongdoing.
Borden Ladner Gervais' overview of the legislation points out that the decision to initiate such negotiations rests with the prosecution, not with the corporation.
Negotiations for a Remediation Agreement are formally initiated by the prosecution, although we expect that corporations accused will typically invite the initiation of a negotiation as part of a company’s cooperation with an investigation. Prior to commencing a negotiation, the prosecution must determine that there is a reasonable prospect of conviction, that the negotiation is in the public interest and obtain the consent of the Attorney General to the negotiation. The prosecution must also determine that the act or omission did not result in serious bodily harm or death, injury to national defence or security, and was not committed at the direction of organized crime or a terrorist group. The prosecution must also inform victims of the negotiation, including non-Canadian victims (e.g., in the case of a foreign bribery prosecution).

What Is The Justification For This? 

Prosecuting corporations has long been a complex problem.  Even if you can successfully prosecute the company, levying any punishment beyond fines, and possibly imposing some kind of oversight on the activities of the company, is extremely difficult.  

Stephen Aylward, writing for the Globe and Mail, argues as follows:  
These agreements (called “remediation agreements” in the draft legislation) will be available to corporations facing charges of economic crimes such as fraud and bribery. Prosecutors must consider how the misconduct came to light and corrective steps taken by the corporation when deciding whether an agreement is appropriate. The corporation must agree to publicly acknowledge the relevant facts, compensate victims, pay a financial penalty and co-operate in the prosecution of any individual wrongdoers. The bill foresees an important role for the courts in overseeing these agreements (unlike the U.S. model, which leaves greater discretion to prosecutors). 
A conviction may block a firm from bidding on government contracts for 10 years. But the more serious impact may be on a firm’s reputation. Arthur Andersen was one of the “big five” audit firms before it was convicted in 2002 of obstruction of justice for shredding documents relating to its audit of Enron. The conviction was overturned years later by the U.S. Supreme Court but the firm had already collapsed, with more than 100,000 jobs lost. 
These high stakes mean corporations must treat prosecutions as a life or death battle. There is little incentive for corporations to settle or to come forward when they uncover criminal activity internally. Well-funded defendants dig in for drawn out legal battles. Meanwhile, victims wait for years without knowing whether they will be compensated for their losses.
Critics complain of special treatment for corporations. Individuals cannot pay their way out of criminal charges and neither should corporations. But corporations are not typical defendants. They are a legal fiction that represents the shared interests of a wide array of stakeholders, most of whom are innocent bystanders. Failing to recognize this can have perverse consequences. BNP Paribas pleaded guilty and paid US$9-billion in fines for evading U.S. trade sanctions in 2014. None of the bank’s executives were charged, although some were demoted and a few were fired. The focus on punishing the corporation left shareholders to shoulder the fine while those responsible walked away. Deferred prosecution agreements require corporations to co-operate in pursuing individual wrongdoers, and so place the focus where it belongs. 

My Thoughts

I am by no means in complete agreement with the legislative construct that has been created here.  My first thought is that critics are well within their rights to criticize it for creating, at the very least, the appearance of an exemption for corporate elites from accountability for their actions.  However that isn't entirely true.  It appears that the intent of this legislation is to make it easier to ferret out the culprits and make it more likely that they can be brought to justice.  The fact that oversight of this process is in the hands of the courts, and not politicians is somewhat reassuring.  That is, in fact, where oversight belongs.  

Prosecuting corporate corruption has long been a difficult conundrum, especially with larger companies.  The larger the entity, the easier it is for corruption to take hold in corners while not necessarily being connected to the overall operations of the company.

In my own experience, corrupt practices can survive a long time in an organization as long as they are "beneficial" to someone a step or two above, but not necessarily be visible to higher levels of the company.  Ferreting this kind of corruption out should be the job of internal company processes, but oftentimes the doctrine of "enlightened self interest" takes hold and a blind eye is turned towards the problematic behaviours, or they are even actively supported.  From the point of view of addressing this kind of corruption, there is some merit to the approach being taken. 

That said, I would like to see the creation of greater direct accountability for the executive and board of directors in these matters.  While in some cases of corruption, it truly is a small group of malfeasants involved, the executive and board have fiduciary responsibilities that should be seen as including the identification and handling of corruption within the organization.  When, as in the situation of SNC-Lavalin, there is evidence of long term corrupt behaviour, the consequences must include those charged with oversight of the company's operations.  However, that may be somewhat outside the purview of this particular legislation.  It is not clear to me how this would play out when senior management and above become implicated in these schemes.  

For those currently trying to make political hay out of this (especially the CPC), it is worth noting that Scheer met with SNC Lavalin's CEO in May, 2018 on this very subject.  While I am not familiar with the nature of any conversation between the PMO and the AG on this subject beyond the broad allegations in the news, I presume that any request to change course was refused on the basis of the state of the case against SNC Lavalin.  If the PMO in fact pressured the AG to change direction, as Scheer and others have asserted, it seems quite likely that Scheer himself would have done the same thing.  

The only thing about this legislation that puzzles me is why it got stuffed into C-74.  It seems to have little to do with the core of the government's budget, and could easily have been a standalone piece of legislation.  I do believe that embedding it in the budget bill has done a significant disservice to the interests of political debate in this country.  

Feeling Buffaloed Yet, Alberta?

So, yesterday Michelle Rempel, and 3 other CPC MPs from Alberta put their names to the so-called " Buffalo Declaration ". Th...