Right On

First Time

2011-05-03T03:25:00.000-07:00

For the first time in my life I am proud to live in the GTA

Looking for comparative information on property tax

2011-03-02T02:06:00.000-08:00

Hello All:

I am quite convinced that us property owners living in the Greater Toronto Area are paying a comparatively high rate of property tax. I live in Brampton and pay 1.2% of the assessed value. Roughly 80% of the 1.2% goes to the city and region (Peel)split equally and the remaining 20% goes to the province for education funding.

How does this compare with your region? I am especially interested to hear from Edmonton and Calgary.

Right On!

And Wisconsin thinks they got a bad deal

2011-02-26T02:35:00.000-08:00

I would bet a lot of money that Wisconsin teachers don't have a total compensation package as generous as this.

I fear Tim Hudak is no Scott Walker.

http://www.etfo.ca/bargainingandagreements/comparingagreements/pages/default.aspx

Right On.

Demanding climate justice from Cancun to Toronto - Discussion with a global warming advocate

2011-01-02T03:17:00.000-08:00

I've taken to posting on Rabble.ca. It is great fun tweaking lefties and injecting some hard facts into debates. Here is a sliver of a dialogue where the entry of a hard fact can't be ignored. The hard fact is $16 million. I'll spare you the article.

Submitted by 2dawall on December 29, 2010 - 7:43pm.

All of the Western governments are completely beholden to corporate interests. Reagan did not reduce power of the state; he used its power to destroy the air traffic union. He did escalate the removal of some social welfare elements but that is hardly the same thing.

The vast majority of scientists confirm the anthropocentric nature of the Green House Effect. The very fact that the PR campaign to deny it mimics the campaign to deny the cancerous effects of smoking are not coincidental.

http://www.ucsusa.org/assets/documents/global_warming/exxon_report.pdf

http://www.guardian.co.uk/environment/2006/sep/19/ethicalliving.g2
»

Submitted by RDP on December 30, 2010 - 7:34pm.

I downloaded the exxon report and briefly read it. Here is what sticks out to me.

From page 4, exxon in 2005 netted $36 billion in net profit. From page 1, exxon has funneled $16 million between 1998 to 2005 to various organizations that the report states manufacturer uncertaninty. $16 million...is this a typo? $16 million divided by 7 years is roughly $2.28 million per year. You would think that this vast corporate disinformation campaign spearheaded by Exxon would "buck up" a little more than .06% of their 2005 profit.

Sorry, it is a vast report severely damning Exxon but when you follow the money, the flow of money (or lack there of) simply undermines the theories of the report.

The appendix letters and documents appear to me to be concerns of those who disagree with Kyoto. I don't smell any conspiracy or plot to conspire.
»

Submitted by M. Spector on December 31, 2010 - 3:58pm.

You think $16 milion doesn't buy a heck of a lot of disinformation when spent in the right places?

How much are you being paid to spread your disinformation? I bet it's a lot less than that.
»

Submitted by RDP on December 31, 2010 - 6:25pm.

If Exxon is worried about protecting their $36 billion in profit, it makes substantial sense to spend a lot more.

Exxon is financing the global warming industry through their tax dollars a heck of a lot more than they are financing any disinformation campaign.

Exxon spends $16 million. Al Gore alone likely spends multiples of that. His movie likely cost at least triple that to produce. David Suzuki has his own weekly television show.

Exxon needs to spend ten time what they do just to level the playing field. How much in governmental grants do these warming scientists receive? They owe a big thank you to Exxon for the tax money.

And, no $16 million doesn't buy a lot of disinformation even if it is spent in the right places.

»

Submitted by RDP on December 31, 2010 - 6:28pm.

Ps Mr. Spector

That is $16 million over 7 years. $2.5 million per year buys 50 commercial spots, on a shoddy channel, per year.
»

* edit

The public service pension plan rip off

2010-05-22T02:36:00.000-07:00

Now this is a rip off! I would need an RRSP of $2,554,273 to be in the same financial situation as this guy. I assume a 2% inflation rate, a 4.5% discount rate, we both die at 85 and we are both 47.

Wages are an understandable number. Large wages attract attention. The value of a pension is harder to grasp. Large pensions attract less attention. The current trend is to pay a great but defendable wage with the big payoff (or ripoff) of a unjustifiably high pension stream, that starts early, waiting at retirement. My numbers are below the article.

Padded Pensions Add to New York Fiscal Woes

By MARY WILLIAMS WALSH and AMY SCHOENFELD

In Yonkers, more than 100 retired police officers and firefighters are collecting pensions greater than their pay when they were working. One of the youngest, Hugo Tassone, retired at 44 with a base pay of about $74,000 a year. His pension is now $101,333 a year.

It’s what the system promised, said Mr. Tassone, now 47, adding that he did nothing wrong by adding lots of overtime to his base pay shortly before retiring. “I don’t understand how the working guy that held up their end of the bargain became the problem,” he said.

Despite a pension investigation by the New York attorney general, an audit concluding that some police officers in the city broke overtime rules to increase their payouts and the mayor’s statements that future pensions should be based on regular pay, not overtime, these practices persist in Yonkers.

The city has even arranged for its police to put in overtime as flagmen on Consolidated Edison construction sites. Though a company is paying the bill, the city is actually reporting the work as city overtime to the New York State pension fund, padding future payouts — an arrangement at odds with the spirit of public employment, if not the law.

The Yonkers experience shows how errors, misunderstandings and wishful thinking are piling hidden new costs onto New York’s public pension system every year, worsening the state’s current fiscal crisis. And the problem is not just in New York. Public pension costs are ballooning everywhere, throwing budgets out of whack and raising the question of whether venerable state pension systems are viable.

In fact, the cost of public pensions has been systemically underestimated nationwide for more than two decades, say some analysts. By these estimates, state and local officials have promised $5 trillion worth of benefits while thinking they were committing taxpayers to roughly half that amount.

The use of public money for outsize retirement pay really stings when budgets don’t balance, teachers are being laid off, furloughs are being planned and everything from poison-control centers to Alzheimer’s day care is being cut, as is happening in New York.

According to pension data collected by The New York Times from the city and state, about 3,700 retired public workers in New York are now getting pensions of more than $100,000 a year, exempt from state and local taxes. The data belie official reports that the average state pension is a modest $18,000, or $38,000 for retired police officers and firefighters. (The average is low, in part, because it includes people who worked in government only part time, or just a few years, as well as surviving spouses getting partial benefits.)

Roughly one of every 250 retired public workers in New York is collecting a six-figure pension, and that group is expected to grow rapidly in coming years, based on the number of highly paid people in the pipeline.

Payouts for Decades

Some will receive the big pensions for decades. Thirteen New York City police officers recently retired at age 40 with pensions above $100,000 a year; nine did so in their 30s. The plan’s public information officer said that the very young retirees had qualified for special disability pensions, which are 50 percent larger than ordinary police pensions. He said several dozen of the highest-paid New York City police retirees had disabilities related to 9/11 and the rest of the disabilities resulted from injuries in the line of duty.

In virtually every case, the officials who granted the rich pensions thought they were offering something affordable, because the cost estimates were too low.

Before Yonkers adopted a richer pension formula for police in 2000, for instance, it was told the maximum cost would be $1.3 million a year. But instead, the yearly cost is now $3.75 million and rising.

David Simpson, a spokesman for the mayor of Yonkers, said pension cost projections were “often lowballs,” so the city could get stuck. “Once you give something, you can’t take it away,” he said.

Police pensions and overtime have been a sore point in Yonkers for many years and were the subject of an exposé in The Journal News in Westchester in 2009. A special audit of police overtime in Yonkers in 2007 found that the police department had failed to enforce its own rules, creating pervasive opportunities for abuse.

Despite all the attention, police are now being paid as flagmen by Con Edison on their days off, Mr. Simpson confirmed, adding that the city was tacking the extra hours onto their pay, which is then reported to the state pension fund.

“The system encourages police to take as much overtime as they can in the last year before retirement. That’s the way the system is structured,” he said. “There’s nothing illegal or unethical about this.”

In fact, a Con Edison spokesman, Robert McGee, said a number of other towns also require the company to use their police officers as flagmen, raising its labor costs.

A spokesman for the New York State comptroller’s office said that the city was in error and pointed to a 1986 decision by the Supreme Court of New York that found that hours worked by police for outside businesses could not be included in their state-paid pensions.

“It has long been established that such overtime from private special duty cannot be included,” said the spokesman, Mark Johnson.

The question of how to pay for generous benefits is proving a challenge to New York and many other states whose revenue has fallen and whose debts have become harder to manage, while public officials try to limit the kind of deep service cuts that often mean political death. Some hard-pressed governments are belatedly coming to the grim conclusion that they have promised workers more than their sagging economies can deliver.

Outside the United States, Greece and Spain have recently reduced government pensions to deal with burdensome debt that has impeded their ability to finance themselves. The new British coalition government has said it will review public pension costs there as well.

Municipalities in this country cannot easily follow suit even as financial problems mount, though, because reducing benefits for their existing employees is considered impossible under the current laws of most states.

The New York State constitution bars public employers from slowing the rate at which workers build up their pensions over the course of their careers. That degree of protection contrasts sharply with the private sector, where companies can generally change the rate at which workers build their benefits at any time. Furthermore, as companies have reduced pensions substantially over the last two decades, states and cities have embellished theirs with sweeteners like inflation adjustments and lower retirement ages that appealed to unions and their members, who vote.

Police and other safety workers are in many cases allowed to retire with full pensions after 20 years. Other workers can often do so after 30 years, even as young as 55, although future hires in New York will have to work to age 62 to get their full benefits, under a law passed in January.

Census data from 2008 show that the typical state or municipal pension is substantially richer than the typical company pension — $15,941 versus $7,904 — for retirees aged 65 and older. By tradition, public employees have said they accepted lower salaries in exchange for better benefits, but the Census data show this has not been true for a number of years. In 2008 the median pay for a worker in the private sector was $39,877, compared with $45,124 for a state or local employee. The data show broad national aggregates that do not try to compare similar occupations.

And, while companies must adhere to uniform federal guidelines about setting aside money to pay pensions, states do not. Some, like New Jersey, have failed to fund their pensions for years and have fallen so far behind they may never catch up again. New York City and New York State have been more diligent about contributing the required amounts each year — but the required amounts now turn out to have been too low, in part because they counted on solid investment returns that have not materialized.

In Yonkers, contributions to the state pension fund keep rising. This year, to save money, the city is proposing to eliminate about 90 police jobs, out of 640. The savings, though, will not even cover the extra cost of the overtime-enriched pensions. Meanwhile, the police say the layoffs will make the situation worse, because shrinking the police force means those who remain must work even more overtime, driving up pension costs even more.

An online, searchable database compiled by The Times contains the names and pensions of about 3,700 public retirees in New York who receive more than $100,000 a year. Information was provided by New York State’s two big pension plans, one for teachers and the other for other state and local workers outside New York City.

Four of New York City’s five big pension funds also provided data. But the city police pension fund listed the six-figure amounts being collected by 536 retired police officers without giving their names. The pension plan for the city’s firefighters has yet to provide the information, as required by public information law.

Even without names, the pension list from the New York City police plan shows a trend toward very youthful retirement, at a time when the city’s contributions to the police pension fund have risen sharply.

New York City has budgeted a contribution of about $2 billion for this year — about 64 percent of the police payroll, one of the highest pension contribution rates in the United States. That amount does not yet include money to make up for the investment losses of 2008, so the rate is almost sure to rise.

A Variety of Occupations

Not all the people getting six-figure pensions are former police and firefighters from cities with liberal overtime and disability policies. Hundreds more worked at hospitals, power utilities, port authorities and other “public benefit corporations” — hybrid entities that compete with the private sector and pay their officials accordingly, but allow them, at the same time, to participate in the state pension fund.

Edward A. Stolzenberg makes a good example. He started out more than three decades ago in the Westchester County government; today, in retirement, he collects $222,143 a year, one of the biggest pensions paid by the New York State pension fund.

In between, he became county health commissioner, running the Westchester Medical Center when it was a big, struggling county hospital. The county made it a public benefit corporation in 1997, with a mandate to grow and compete with the big hospitals in New York City.

In the process Mr. Stolzenberg’s salary shot up. By the time he retired, he was the highest-paid official in Westchester County, he said, with a salary of more than $400,000 a year. That was still less than the rate at a for-profit hospital, he said.

“In a time when the state budget is pretty bad and money is pouring out, people look at pensions and say, ‘This is terrible! Why are people getting this kind of money?’ ” he acknowledged. “It may not be viable. But that’s the way the state structured it.”

He added that his successor at the medical center was making more than $900,000 and accruing a pension.

Companies that find they have overpromised have a way out. They can declare bankruptcy, and if a judge approves, they can send their pension plans to the federal agency that insures corporate pensions. That agency limits its coverage to what is considered a basic pension, currently $54,000 for a 65-year-old retiree, much less for younger people. If Yonkers could send its police plan to the federal guarantor, for instance, Mr. Tassone, at 47, would have his benefit cut from $101,333 to just $15,660.

But state plans don’t have such an insurance program, much less any definition of a basic, guaranteed benefit.

Federal tax law does put a cap on pension payouts, currently $195,000 a year. Congress set this cap, which has risen with inflation, more than 30 years ago to keep employers from turning their pension funds into abusive tax shelters.

But New York State found a way around it. In 1997, lawmakers created a safe-harbor mechanism allowing retirees to collect bigger pensions legally — a second pool of money called the Excess Benefit Fund. Towns all over the state pay the associated costs, even though only a few of them have retirees who qualify. At least 28 recipients in New York get pensions above $195,000 a year. One of the highest is George M. Philip, who gets $261,037 after retiring as chief executive and chief investment officer of the New York State teachers’ pension fund. Since retiring, he has gone back to work as president of the State University of New York at Albany, drawing an additional $280,000 last year.

New York’s attorney general, Andrew M. Cuomo, has said public pensions are getting out of hand, and has begun an investigation of places, like Yonkers, where there are unusual concentrations of six-figure retirees.

But he may well find that most recipients have done nothing illegal. The benefits have been enacted by legislators, signed into law by governors, hailed by comptrollers and adopted by local officials — all of whom were told by actuaries and other financial advisers that the pensions would cost just a fraction of what they are now turning out to cost.

“In very few cases do they know what they’re agreeing to,” said Edmund J. McMahon, director of the Empire Center for New York State Policy, which tracks pension costs. “They almost always obscure the costs, from themselves and from the public.”

Offended by Comments

Mr. Cuomo did not name Mr. Tassone but spoke of a Yonkers officer who had retired at 44 on $101,033 a year. Mr. Tassone said all his neighbors knew it was him, and he bristles at the implication that he got more than he was supposed to. He said he could correctly document all the overtime he worked, and that the practice was approved by the mayor and city council.

The special audit in Yonkers named Mr. Tassone in its sample of retirees with unusual overtime records, but did not accuse him of doing anything wrong. Disciplinary proceedings were brought against only one officer, who is now retired.

Mr. Tassone said the only reason he joined the police force was the promise of a full pension after just 20 years, and it would have been wrong for the state or city to go back on the promise after using it to recruit him.

He said he put up with hardships for 20 years as a police officer, “and now I’m at the end of it and I’ve become a target,” he said. “I broke my hand three times. I broke my left ankle. I blew out my knee. In my last two years alone, I made between 350 and 400 arrests, and a lot of those people weren’t volunteering.”

Because he could retire young, he added, it was important to start out with the largest pension possible. In the coming years, inflation will eat away at his benefit. Public pensions in New York City and State have had a cost-of-living adjustment feature since 2000, but it applies only to the first $18,000.

“I concede, I have a very good pension, but what’s that pension going to be worth when I’m 70 years old?” Mr. Tassone said.

Although limited to the first $18,000, the cost-of-living adjustment was the most expensive pension enhancement enacted in recent memory in New York, according to the Independent Budget Office. The cost has, once again, proved higher than expected.

Yonkers still offers full pensions to police after 20 years, but just in theory. For the moment, the city is too broke to send any new cadets to the police academy, and retirees are not being replaced.

Hugo Tassone
Approximate Current Value of Pension Plan


	Current Value of DBPP		$2,554,273	Based on assumptions

	Inputs:
	Payment	$100,000
	Current age	47
	Retirement age	47
	Age of Death	85	assumption
	Inflation rate	2%	assumption
	Discount rate	4.5%	assumption


			Current
	Age	Payment	Value
	47	$100,000	100,000
	48	102,000	97,608
	49	104,040	95,273
	50	106,121	92,993
	51	108,243	90,769
	52	110,408	88,597
	53	112,616	86,478
	54	114,869	84,409
	55	117,166	82,389
	56	119,509	80,418
	57	121,899	78,494
	58	124,337	76,617
	59	126,824	74,784
	60	129,361	72,995
	61	131,948	71,248
	62	134,587	69,544
	63	137,279	67,880
	64	140,024	66,256
	65	142,825	64,671
	66	145,681	63,124
	67	148,595	61,614
	68	151,567	60,140
	69	154,598	58,701
	70	157,690	57,297
	71	160,844	55,926
	72	164,061	54,588
	73	167,342	53,282
	74	170,689	52,007
	75	174,102	50,763
	76	177,584	49,549
	77	181,136	48,363
	78	184,759	47,206
	79	188,454	46,077
	80	192,223	44,975
	81	196,068	43,899
	82	199,989	42,849
	83	203,989	41,823
	84	208,069	40,823
	85	212,230	39,846
			$2,554,272.87

Our own special interest group

2010-05-17T00:36:00.000-07:00

Special Interest Group - definition - confer large benefits to a small group with the cost spread thinly over a large population by lobbying the politician with the promise of votes.

Politician - definition - one who wants to be re-elected.

Population - definition - likely doesn't belong to a special interest group and is interested only with bettering their lives.

Rational apathy toward special interest groups - definition - Apathetic to special interest groups for rational reasons. The cost of non-apathy is large compared to the benefit of non-apathy.

Politicians are constantly lobbied by special interest groups seeking gains paid by others. The population has little interest or time to offset the lobbying effort with their own lobbying effort. Politicians confer benefits and secure votes without the fear of losing votes from those not connected to the special interest group. Think teacher's union...a special interest group with a whole lot of votes.

We need a special interest group for us rationally apathetic folks. This is why I am a member of the Canadian Taxpayer's Federation. They are at www.taxpayer.com

Public servants and their unions

2010-05-07T02:22:00.000-07:00

http://www.guardian.co.uk/world/2010/may/06/greek-debt-crisis-athens-greece

The violence and death in Greece captured on video would make for a great television commerical. With the video running, the voice over says: "Fire public servants now before they fire (bomb) you." "Paid for by concerned citizens working in the private sector"

Right On!

Sex education in the early grades

2010-04-22T14:45:00.000-07:00

As others, I suspect the push towards sex education in the younger grades is really about exposing youngsters to the concept of homosexuality. Teach them early to gain greater exposure and tolerance towards homosexuality. I have no problem with promoting tolerance towards homosexuality. I have a big problem with the promotion of homosexuality. Exposure to homosexuality can quickly lead to the promotion of homosexuality. The promotion of homosexuality is wrong at any age.

Right On!

Gap between rich and poor

2009-09-19T05:14:00.000-07:00

A distinguishing characteristic between right and left wing thought is the importance given to the income or wealth gap (or however rich and poor is defined) between the rich and poor. The left places more importance on this statistic than do those on the right.

I am on the right and therefore feel the statistic is given too much importance. A thought experiment illustrates why. Say all the rich earn $100,000 per year and all the poor earn $25,000 per year. The gap between the rich and poor is $75,000 per year. Say I have magical power and can halve or double everyone's income. If I halve everyone's income, the gap between the rich and poor falls to ($50,000 - $12,500) = $37,500. If I double everyone's income, the gap between the rich and poor increases to $150,000.

Which group is happy if I halve their income? The rich sure aren't and neither are the poor. The poor may acquire a degree of psychological happiness due to greater income equality but not enough to offset their drop in income. Greater income equality in this extreme thought experiment results in greater unhappiness for both groups. Income equality can be undesirable.

Those on the left say take from the rich and give to the poor to reduce income equality. Income for the rich declines and income for the poor increases by the amount of redistribution. This is what our society does and is valid to a certain extent. A social safety net is desirable. However, redistribution has limits, especially at the margin. Taking from those who produce results in less incentive for them to produce. They therefore produce less. This helps no one.

There are limits to redistribution. Going beyond the limit harms everyone. Placing too great an importance on the gap statistic leads to a redistribution beyond point of harm.

Right on

The Most Powerful Special Interest Group

2009-09-18T03:34:00.000-07:00

Politicians, especially those on the left, are feeling the power of the most powerful special interest group.
The most powerful special interest group consists of citizens who do not belong to a special interest group. Piss them off and you are gone.

Right on!

The U.S. and disabled children from a Canadian's perspective

2009-09-08T17:36:00.000-07:00

I spent last week in the U.S. and was struck by something. This is purely anecdotal but it seemed to me that there are many more disabled children in the U.S. compared to Canada. How could this be, I asked myself, for such a wealthy society. Then it dawned on me.

We abort ours.

God bless America!

Full Day Learning ffor Four & Five Year Olds in Ontario

2009-08-18T19:00:00.000-07:00

The Ontario Liberal government will be pushing full day learning for 4 and 5 year olds. They plan implementation in Sept. 2010. There are so many things wrong with this that it is hard to know where to start the criticism.

Four and five year olds are probably best off with a parent. If this isn't possible, let the parents decide which day care is best. The premise that I accept, and apparently our provincial government doesn't, is that parents will make the best choice for their children.

When my wife and I decided to place our daughter in daycare we researched and visited a number of establishments. We chose the one we thought was right that suited our budget. Our decision proved to be correct. We were confident that the daycare knew who the client was: my wife and myself. We were confident that they knew that if we grew displeased with their service that we would replace them. The bottom line is that choice kept our private daycare, and others, honest, responsible, and incented to do good work. Choice worked. They provided a great service. (Peekaboo daycare in Brampton off Kennedy and Sandalwood for anyone interested)

My daughter finished grade one. The experience we as parents had was less than praiseworthy. We were informed significantly less than daycare. The teachers were not their when we dropped off our child (at 7:45) and were long gone by the time we picked her up. We got to see her daily work periodically, not weekly as in daycare. The attitude of the teachers and staff was what you would expect from someone with union backing and very little competition. (Private schools are out of our price range).

Choice is the key. Government run schools crowd out choice except for the top earners of society. Without choice, we have no power.

On a side note, it is very interesting that private establishments such as Kumon, Oxford Learning Center, and others are popping up all over. There is a market for establishments that will supplement your child's education. If our school system was doing a good job, this wouldn't be happening.

I know how full day learning for four and five year olds will go. The Toronto garbage strike provides a strong clue. The staff will have great compensation packages, great benefits, and a Cadillac pension plan and they will still strike or threaten to strike every three or four years.

Full day learning for four and five year olds is a bad idea the deserves to be stopped. Write to your provincial government representative and tell them so.

Right On

History of the World

2009-08-15T06:13:00.000-07:00

The history of the world is one of tyranny and misery. People throughout history have lived under tyranny of an all powerful leader or state. The grandest exception to this is the United States for the last 233 years. The United States has been a pond of freedom and prosperity in an ocean of tyranny and misery.

Why? The DNA of the American is no different than others. Look no further than the constitution and the bill of rights. The right to Life, Liberty and The Pursuit of Happiness is the foundation. The bill of rights lists the protections that the citizens have from their own government. How profound. Freedom is unleashed. With freedom, citizens are unshackled to pursue their interests. And pursue they do. This pursuit leads to achievement and effort and individual betterment.

Do not muck this up. Allow the individual to pursue, achieve, and advance and you have a better citizenry and country.

Right On

Nationalized Healthcare - To Our American Friends

2009-07-01T03:50:00.000-07:00

You are in the middle of the great debate. Which mode of health care delivers health care most efficiently; public, private, or a combination of the two. Many have pointed to Canada's system to argue that public delivery is the "best". Maybe it is, maybe it isn't. This I don't want to argue. But, you should have an idea about the difference in what we pay in tax compared to what you pay in tax.

We have roughly similar societies. We don't have to finance a per capita defense budget as large as yours but everything else is similar. There is a great Canadian income tax calculator at http://www.ey.com/CA/en/Services/Tax/Tax-Calculators. This provides the amount of tax on income owed to the federal and provincial governments on various levels of taxable income. Taxable income is a close proxy to salary.

At $50,000 of taxable income, $9,497 of tax is owed in the province of Ontario.
At $100,000, $28,036 is owed.
At $150,000, $50,453 is owed.

Canadian's can use RSP contributions (similar to IRA contributions) to lower taxable income by $20,000 and defer tax to retirement years but there aren't many other methods to lower tax.

This doesn't include federal and provincial sales tax of roughly 14% on non-staple items nor property tax of roughly 1% of the value our homes nor many other nuisance taxes and tariffs.

Dear Americans, calculate your total tax and add your insurance premium to it and I will bet that the sum doesn't come close to what our total tax bill adds up to. It may if you choose the public health care delivery method.

Good luck.

Right on

Why I don't want a public daycare service

2009-06-27T05:45:00.000-07:00

The Toronto garbage strike. Garbage collectors earn between $45 and $60K per year, have a great pension, bank up to 18 sick days per year and have other benefits. They still strike. Doesn't everyone see the connection.

Public daycare workers will be offered overly generous compensation and benefits and with time will push for more. The push will never end. They will hold parents hostage with strikes or threatened strikes.

The system as it stands is a vast transfer of wealth from those working in the private sector to those working in the public sector. Public daycare only adds to the problem.

Right On

Iran, Iraq, & exporting democracy and freedom

2009-06-26T15:09:00.000-07:00

Interesting this uprising in Iran. Could it be that they look at Iraqis without Saddam H. with envy. They see Iraqis' upcoming freedom and want some for themselves. I hope they succeed.

Is this the Bush doctrine in effect? Bring democracy to a region and eventually all tyrannical governments in that region will succumb.

Who says you can't export democracy. And who says you especially can't export it by force. Japan and Germany beg to differ; and are thankful.

Freedom is the natural yearning of the human heart and unleashes the human spirit. Democracy and capitalism are the natural extension of freedom. A free nation is a better nation. The proof is in.

Right on

Conservatism taught to my children

2009-06-24T15:47:00.000-07:00

Why are there wars daddy?

Well, because countries, like people, have differences.

My teacher says that these countries should just talk and not go to war.

I agree to a certain extent. All options should be explored and exhausted before going to war. However, once all options are exhausted, there are two paths; appeasement or war. What is appeasement daddy? It is giving the enemy what it wants. Appeasement never works. It leads only to further demands. It delays the inevitable war or leads to surrender. It is like the bully at school who demands a dollar. If you give him a dollar to make him go away, I promise you he will demand another dollar tomorrow.

Your teacher says we should talk to our enemies. There is one truism son: When good negotiates with bad, good loses every time. Son, we believe in freedom, democracy, and capitalism for everyone. It is a system that has proven itself to produce the most human happiness where ever it has been tried. All other systems fail in comparison. If the enemy rejects freedom, democracy , and capitalism, we have nothing to negotiate.

To often those who want to negotiate to promote peace just want to be left in peace. Peace can be had instantly through surrender but this is no way to live. Our system is the best and we will have to sometimes fight to keep it.

Thanks for the question son.

Right on

Conservatism taught to my children

2009-06-20T05:06:00.000-07:00

How was the game son? Great dad. I played well. Did you win? Well, they don't keep score. Why don't they keep score dad? Yes, that's right. I forgot about that.

They don't keep score because they want to protect the self esteem of the players on the losing side. When you lose you don't feel good do you? No, I feel bad when we lose. But dad, the Toronto Maple Leafs keep score. The players must feel really bad all the time. That's funny son. Yes, they keep score. They aren't children so they don't need to protect their self esteem. Is it good that we don't keep score. No son, it's bad.

They want to protect your self esteem. In other words, they want your self esteem to develop and grow. But they misunderstand how self esteem develops. A positive self esteem comes from accomplishment. When you can look in the mirror and say "I did a good job" you are developing positive self esteem. If you know you didn't do a good job but someone tells you that you did your self esteem doesn't grow. You know they aren't being truthful but simply want you to feel better.

When you win; rejoice, but also ask yourself what you did well and what could use improvement. When you lose, ask yourself why you lost. Try to correct it. True self esteem will come when you beat the team that beat you. This is accomplishment. You improved yourself and the proof is that you beat the team that could once beat you.

By not keeping score the league is robbing you of this process. But do you know what the dirty little secret is son? No dad. The kids are keeping score in their heads. I bet you know what the score was don't you son. Yes dad. We won 3 -2. Atta' boy son. Thanks dad.

That's a lesson for you. Accomplishment and overcoming obstacles will make you a better person.

Conservatism taught to my children

2009-06-19T03:32:00.000-07:00

Thank you for helping me mow the lawn. What kind of chocolate bar do you want? The reason I am buying you a chocolate bar is you assisted me with my tasks. You earned the chocolate bar. The reason I am not buying your brother or your sister a chocolate bar is that they didn’t help. This is an important lesson in life. If you want something, you must earn it.

Here comes mommy. Mommy is a liberal. Mommy wants you to share your chocolate bar equally with your brother and your sister. Now that she is gone, I want to reiterate, it is your chocolate bar and you decide what to do with it. Any decision is fine with me. Let me point out one thing. Your sister has a broken leg and I believe she wanted to help but couldn’t. She hung around the whole time. I agree, I think you should give her a piece. This is an important lesson in life. It is noble to help those who can’t help themselves.

We’ll continue tomorrow.

Right on

Obscene profits

2009-06-14T17:19:00.000-07:00

There is only one number quoted when the charge is obscene profit. That is the profit number. One billion dollars, for example. That is a big number. Any business that has one billion dollars of profit must be regulated.

It is a big number. But, what if $10 billion was invested. The return is then 10%. Not too obscene. If $20 billion was invested, people are getting fired if profit is one billion.

The profit number doesn't tell the whole story.

The Canadian Dollar

2009-06-06T03:30:00.001-07:00

I love it when our dollar rises. I am richer when our Canadian dollar rises. I can buy more lettuce and golf balls and gas per dollar when our Canadian dollar rises. Some get hurt when our Canadian dollar rises (vs. the US dollar). Manufacturers who export to the US get hurt. Their product becomes more expensive to Americans and less will be bought. This is somewhat mitigated if inputs needed to manufacture the product are bought from the US.

There is an attitude in Canada that a rising Canadian dollar is bad for Canadians. It isn't. It is nothing but a positive except for exporters. As there are more Canadians than Canadian exporters, a rising Canadian dollar is a net positive for Canada.

Let it rise Bank of Canada!

Right On.

LCBO & profit

2009-05-30T04:30:00.000-07:00

Again I heard on the radio that the LCBO (liquor control board of Ontario) was great for Ontarians because it generates a profit. This is hogwash.

The LCBO is a pure monopoly with a product that is relatively price inelastic. Inelastic means that if the price changes, sales do not change by much. If the price of a 6 pack goes up by 1$, I will still by the six pack (my name is not Joe).

The LCBO generates a profit by inflating prices with the full knowledge that sales won't decline by much. Who pays the bill? Me the consumer and other business. If I have $100 of disposable income per week and I pay $13 for a 6 pack, I have $87 to spend elsewhere. If the price was $7, I would have $93 to spend elsewhere. I lose by not being able to buy an additional $6 of other goods and other business loses by not selling me an additional $6 worth of goods. Should I decide to save the $6, the banks have more money to lend to a budding entrepreneur.

Government should not be in business. Government business reduces disposable income and crowds out other business.

Right On

Pension payments to public servants is where we get taken

2009-05-28T02:51:00.000-07:00

I sat down with a 55 year old lady who is contemplating retirement. She works for the federal government and earns $90,000. She has been with them for 30 years. Because she has been there 30 years she is entitled to full pension. She will get $55,000 per year plus inflation starting now. I did a present value calculation. If inflation averages 2.5% and she lives to 85, the present value of her payment stream is over $1,000,000. The RRSP account of someone her age without a pension would have to be over $1,000,000 to be in a similar situation. I have never seen an RRSP account over $1,000,000.

You can argue that her salary of $90,000 is too much. But, her pension is definitely too generous. This is where the tax payer gets shafted.

Unions inflate pensions rather than wages because they know that this draws little attention from the taxpayer.

Right On

2009-04-11T14:26:00.000-07:00

http://www.economist.com/debate/overview/142&sa_campaign=debateseries/debate21/ads/house/125

This is scary. This is the byproduct of a leftwing dominated eduction for two generations.

Individual income has a direct correlation with productivity. There is no disputing this. People rarely get paid big bucks unless they earn them (unless they are union protected or work for the government).

If you take from the most productive and give to the least productive you get less productivity.

Teach your children about the beneficence of capitalism and freedom. Our schools and universities won't.

Right On

Do you dream of peace?

2009-03-31T14:33:00.000-07:00

I've got a daughter in grade 1. Cute as a button and pretty darn smart (I fear the comparison may be self relative). Swinging on the right side of the political / philosophical spectrum, I am well aware of the left wing bias in our school system. Although I haven't seen much (except for my post "It's all about the children"), I have a friend with a daughter in grade 5.

My friend went to his daughter's school concert recently and was wee bit annoyed with the content. They sang a song where the chorus was "Do you dream of peace"? The chorus was repeated ad nauseam. The message was loud and clear and I don't want my daughter learning it. War is always wrong, never justified and we should resolve our conflicts by dialogue.

As I watched the movie Saving Private Ryan I was thinking what would happen to the teacher who produced this concert in 1942. The parents would have shouted "we dream of victory" and beat the daylights out of the teacher. I would ask the current teacher do you dream of peace or do you want to be left in peace. Peace can come instantly through surrender.

Will my daughter be taught that nothing in life is worth dying for? If so, when did this begin? As Reagan said in his 1964 speech, "should Christ have refused the cross, did the fallen allies in WW2 die in vain, should slaves accept slave masters.

I will teach my daughter that the concept of peace at any price is wrong. The world has a history of war and we have and will have enemies. If we can avoid war great; but there are some lines the enemy can't cross.

Right on

Ontario Budget

2009-03-26T22:22:00.000-07:00

"•Cutting personal income tax rate from 6.05% to 5.05% on the first $36,848. Rates for next two categories ($36,848 - $73,698 and greater than $73,698) stay the same, at 9.15% and 11.16%."

I love the rich. One day I hope to be one. The rich pay most of the tax. The top 10% of income earners pay something like 40% of total tax revenue. The bottom 50% pay something like 10%. Hug the rich; they pay the bills!

Why are the rich rich? Because they work hard and smart. They are highly productive people. Sure some inherit their wealth but most earn it.

The Ontario government is cutting tax the typical way. They are lowering tax rates at the bottom of the income spectrum and leaving rates at the top as is. (I am pleasantly surprised they didn't raise them). If the goal is to reignite an economy, the opposite should be done. Or, cut tax rates accross the income spectrum by the same percentage amount. For example, cut all rates by 10%.

Income tax is a disincentive to earn income. The higher the tax the greater the disincentive. A progressive tax increases the disincentive as income rises. In Ontario, income over approximately $126,000 is taxed at 46%. Talk about disincentive! Why not decrease the disincentive (increase the incentive) to work and invest for the most productive in society. Long live supply side economics!

Right On

Let's Create Jobs

2009-03-24T16:38:00.000-07:00

I have a plan that will create jobs and a new industry in Canada.

We in Canada produce very little sugar. We should change this and develop an industry that will create home grown sugar for domestic and foreign consumption and provide well paying jobs for Canadians.

Canada has never had the climate to grow sugar cane and have therefore never had a sugar industry. But, with technology we can circumvent our climate constraints. We have the technology to build greenhouses that can house the climate necessary to grow sugar cane.

The government should embark upon a program that pays for the construction of sugar cane growing ready greenhouses and to hire staff necessary to grow it. This creates construction, administration, marketing, and executive jobs and creates demand for feeder industry and expertise.

Of course, a new industry will need some help to produce a competitive product. Foreign producers have a climate advantage that we can't compete against. For this reason, I suggest a series of subsidies and tarriffs. Subsidies will have the effect of paying some of the cost thereby allowing our sugar company to sell product profitably at a lower price than possible without the subsidy. Tarriffs increase the price of foreign sugar sold in Canada. This increases the competitive position of our greenhouse sugar to Canadians. Canadian sugar on Canadian tables!

There is very little downside to my plan. The upside is obvious. More jobs and a new industry.

Oh yes, that is correct...subsidies come from the tax Canadians pay. We may have to raise tax to finance the subsidies. Tarriffs raise the price of foreign sugar for all Canadians and allows our company to raise its price. Yes, Canadians will be poorer and be paying more for sugar but don't be a downer. We have created a new industry. Yes, it is possible that the nations that export sugar may be unhappy with what we propose. And it is possible that they may retaliate with tarriffs on our exported products. And they may try to create industries that we excel at thereby harming us.

Come to think of it...my plan is CRAP!

Right On

My favorite movie Starring Ronald Reagan.

2009-03-22T12:06:00.000-07:00

I think this is his best work. Sit back, relax, and enjoy the next half hour. It is remarkably relevant today.

www.youtube.com/watch?v=yt1fYSAChxs

Right On

The Tyranny of the Special Interest Group

2009-03-22T03:46:00.000-07:00

The strongest influence on a politician is exercised by the lobbying of special interest groups. The goal of a special interest group is to confer substantial benefits to its membership and have the cost of these benefits spread thinly accross the population. The goal of the politician is to secure the block of voters who comprise the special interest group without losing votes from the rest of the population. Both the politician and the members of the special interest group gain from the relationship at the expense of the population. It is a relationship without much of natuaral check or balance. The result is a poorer population.

Both the special interest group and the politician rely on the rational apathy of the population. The key word is rational. I'll use milk farmers as a an example. If the government mandates a 5% increase in the price of milk and the proceeds given to milk farmers, milk farmers gain a 5% increase in their revenue (I am ignoring the fact that some consumers will choose to substitute other products for milk as a result of the price hike). I am out a only small sum as milk comprises a small portion of my expenses. Let's pretend that a 5% increase in the price of milk raises my total expenses by .1% The milk farmer gains substantially more than I have to lose. What is my rational response to a 5% increase in the price of milk? Not much because it doesn't affect me greatly. The politician relies on this.

Rational apathy is at work. I can devote time and resources lobbying the government to remove the mandated hike, but this is irrational. My gain with a successful lobbying effort is small. My time and resources are better spent on other things. Compare this to the milk farmer. His lobbying efforts brought him a 5% increase in revenue. The return from his lobbying effort is substantial. His lobbying effort is rational. The politician acts rationally by conferring benefits to milk farmers. He gains or secures their vote without much risk of losing mine.

The problem is that there are many special interest groups. Each has as its goal confering benefits on its members while spreading the costs thinly accross the population. These costs add up! The members who don't belong to a special interest group (largely T4 income earners who work outside of the public sector) pay dearly for these benefits. We pay through high taxes and higher prices due to tarrifs and subsidies. As an example, read my previous post "It's About The Children" and consider how and who pays these salaries and benefits.

There is only one solution. We who don't belong to a special interest group must group and act like one. Politicians who succumb to the desires of other special interest groups will lose our vote. The Canadian Taxpayers Federation would be a good grouping mechanism.

Right On

It's About The Children

2009-03-14T05:05:00.000-07:00

In 2004 an income of $89,000 was enough to place an individual in the top 5% of our country's income earners. www.statcan.gc.ca/daily-quotidien/070924/dq070924a-eng.htm. Inflating that figure by 2.5%, a rough proxy for inflation for the last 5 years, gives a threshold of $100,700 to join the top 5% club in 2009.

Thanks to the website of the Elementary Teachers Federation of Ontario, we find this http://www.etfo.ca/BargainingandAgreements/comparingagreements/Pages/default.aspx. Currently a teacher with 11 years of experience in Peel region (a 'burb of Toronto) earns $84,088. I estimate that a teacher has 3 months off. I'll give them one month of holiday and the rest is non-work. $84,088 for 10 months of work equates to $100,900 for 12 months of work.

A teacher's starting salary is $45,744 and grows each year until they reach the maximum of $84,088 11 years later. Every year the grid moves higher with inflation and gains from collective bargaining. For example, the starting - maximum amounts for 2005/2006 were $43,467 -$79,073 and for 2006/2007 were $44,315 - 81,461. I am not sure what their pension benefit is but I bet it is generous. I know it is a defined benefit pension plan meaning they get a percentage of their ending salary for the rest of their life.

I don't begrudge anyone for making a nice salary, especially if I am not paying for it. But, there is too much wrong with the structure of a teacher's remuneration in Ontario that it is worth commenting. Firstly, should teachers earn at the top 5% of income earners? I have a problem with that. It is a tough job with responsibility but so is every job that pays in the top 5% bracket. Secondly, they need to realize the extent of their remuneration. Many teachers complain. This needs to stop. Thirdly, 11 years to maximum salary is a massive benefit. At some point, I will reach my maximum salary. I would have been substantially better off if I reached the maximum 11 years after starting my career. The average teacher will reach maximum earnings at the age of 36. Forthly, they get the two best weather months off.

The power of their union is immense and it amounts to a large special interest group (more on the evils of special interest groups to come in another post). Politicians battle the teacher's union at consederable risk. Ask Mike Harris. There are roughly 170,000 teachers in Ontario out of 12,000,000 Ontarians of all ages. When teacher's say "We need smaller classes" I hear "we want more teachers to make our union even stronger". The politician who secures the blessing of the teacher's union drastically enhances the chance of winning the election and vice versa. But, who has my back?

Teachers and their union are responsible for a large transfer of wealth from the private sector to the (psudo) public sector. This eventually has to be dealt with and scaled back.

RIGHT ON

Supply Side Economics - The Free Lunch

2009-03-10T21:42:00.000-07:00

Canada has yet to have a meaningful discussion about Supply Side Economics and we are poorer as a result. There is a free lunch and it is called supply side economics.

Supply side economics has as its foundation that individuals are rational and incentives and disincentives matter and affect behaviour on the margin. Out of this arose the famous Laffer curve.

The Laffer curve simply makes sense. At a 0% tax rate the government has no revenue. If tax rates rise, government revenue rises but only to a certain point. Once that point is reached, increases in tax rates actually reduce government revenue. At a 100% tax rate the government has no revenue. Who would work if after-tax income is $0? The Laffer curve states that at high (marginal) tax rates, a reduction in the tax rate actually increases government revenue.

Why? Taxes are a disincentive to earn employment income (or interest income, or dividends, or capital gains). Lower the disincentive to earn income and you get more people who want earn income (work). Lower the disincentive to invest and you get more business, savings (earning interest income), and investment. The two add up to a greater desire to work and a greater demand for workers (more people working harder and more people working).

The criticism about supply side economics is that it is tax cuts for the rich and that this creates a greater inequity between the rich and the poor. The response is ask a poor person what they want, greater equality or more money, and they rationally choose more money every time.

Every time it has been tried (both Kennedy and Reagan slashed taxes, Ireland, New Zealand,…) it has worked. “Worked” is defined as an increase in government revenue after tax cuts. With Ontario’s high marginal tax rates (46% federal and provincial combined rate on income over $126,000), Ontario is a prime candidate for a supply side tax cut. Let's eat the free lunch.

Right On(tario)

Why socialism doesn't work.

2009-03-05T17:59:00.000-08:00

Socialism does not work. Why not? The average wage in society is lower due to socialism and everyone has to make do. Socialism destroys wealth. Socialism has many definitions but the one I am using is a redistribution of income from those who have it to those who don't. Ultimate socialism would be determining the average wage, taxing those who make over it down to the average wage, and subsidizing those who earn below it up to the average wage. The problem with ultimate socialism is that those who earn over the average wage have no incentive to keep earning if it will be taxed away. Once they earn up to the average wage they will choose leisure over work. The average wage then falls. Incentives matter and greatly. Socialism does reduce the gap between the rich and the poor. Unfortunately, it does so by making everyone poorer. Socialism is a scaled down version of ultimate socialism. It doesn't work either but collapses slower.

The bottom line is that if you take away more from people who work and give more to people who don't work the result will be less work. For both rich and poor the incentive is to work less.
Right on

Who Pays For Cap & Trade?

2009-03-04T14:41:00.000-08:00

Who pays for Cap and Trade? I work for a non-unionized company in Canada. I receive employment income. Who is going to pay for Cap and Trade or any of the carbon reducing initiatives? Me, and the vast majority of people who work for non-unionized profit-motivated companies.

Business has predominantly one goal and that is to create profit. This is as it should be. Competition keeps them honest. Business has revenue and cost with the difference being profit. It is universally agreed that any carbon reducing initiative is going to increase the cost of energy. Most businesses have an energy cost. Some are large and some small but all have the cost. What will business do if the cost of energy rises substantially? Due to the profit motive, business will pass on at least a portion of the added cost to the consumer. They have no choice. As an example, if revenue remains stable but cost rises 10% the business generates less profit. Assuming that competition is fierce, which it always is in a free market, there is little room to absorb the reduction in profit. The competition has to do the same.

Why do I pay for it? A hike in price of a good or service due to hike in cost is a one-time inflationary event. A hike in the price of all goods and services is a big-time one-time event. If prices for everything go up 10%, inflation goes up 10%. My employer and most employers will be reluctant to increase my wage, which is another cost to my employer. This is especially true if profit is falling. What about the unionized worker and the public service worker? They will bargain for a cost of living increase. Cost of living increases may already be written in their contract. If prices rise 10% they will get a 10% raise (and probably something on top of that). They are no worse off after the inflationary event. I am. I won't get the raise. My company will be in no position to offer CPI offsetting raises. If inflation jumps 10% and my salary doesn't, I am 10% worse off. I pay for the carbon reduction initiative.

I have a proposal. I will agree to the situation if public sector employees and unionized employees forgo cost of living increases for a certain period after the carbon reduction initiative is implemented. If so, they may not be so welcoming of its implementation. This levels the playing field.

Right On