Canadians Don't Think Politicians Debate Important Issues Well.

The fundamental underpinning of an effective democracy is debate amongst citizens as well as their elected representatives. The belief is that an informed and engaged citizenry will make for better democracy and better governance because, as the theory goes, the quality and substance of the public debate will create these preferred outcomes.

According to an April 11, 2008 Ipsos Reid release of on-line survey results 77% of Canadians think this is not happening in Canada. Only a third believes our politicians are doing a god job of debating the important issues facing Canadians. Ouch…considering that is a large part of why we elect them. And, just as bad, 79% of us think that we Canadians are “too reserved” as a people when it comes to debating important issues.

These findings are at the heart of some of the reasons why citizens are not participating in elections and the political culture of the country. On the up side, 86% of Canadians “enjoy being exposed to people and ideas that challenge the way they look at the world.” Perhaps our political parties, our public intellectuals and thought-leaders need to get out more and start talking to people where they live, work and try to raise a family.

The media is seen as doing a good or great job on thinking about the issues by 65% of Canadians, but 66% see NGO’s in this positive light. Not bad but 73% see more awareness and thoughtfulness about important issues coming from friends and family and 72% see universities as thoughtfully engaged in the issues of the day. The church is no seen as a source of thinking on issues – 63% say they do a poor to terrible job in this area.

In a time when it is hard to find an institution in our society that has not lied to us or betrayed our trust in some significant way it is not surprising to see these result. The gut-check most of us political activists do around civic engagement and political participation is confirmed by this survey. This authentication of the collective intuitive sense of what is happening to and in our body-politic does not alleviate the problem but it sure brings it into a sharper focus.

A comprehensive and contentious citizen engagement initiative that is not a tepid tinkering with the electoral process is an idea whose time has come. I hope the Stelmach government with consider such a genuine trans-partisan effort to understand why our democracy seems to be failing our citizens and our society and adding to cynicism as the default political position of so many people

Laurie Blakeman Was Like "Donna" Quixote in Her Chase for the Speaker's Chair

I admire the pluck and posturing of the Liberal MLAs Blakeman (Edmonton Centre) and Pastoor (Lethbridge East) efforts for their personal ascension to the Speaker and Deputy Speaker position. Kind of reminds me of Don Quixote.

All Hail “Donna Quixote” (a.k.a. Laurie Blackman) and Sandra Panza (a.k.a. Bridget Pastoor) on their Quixotic excursion and parallels and spoofs the same over-the-top chivalric romance of the Cervantes original “novel” idea.

Still these two Liberal MLAs showed some independence and spunk in putting themselves up for election as Speaker and Deputy Speaker of the Alberta Legislature. Their rationale was Ken Kowalski has been there long enough and it is time for a woman to hold these positions - simply because no woman has done so before.

Hummm...I wonder if basing such a decision on gender really makes sense as sufficient justification? We sure need more women in politics and I acknowledge the system is stacked against them. However, when women really want more women elected to public office they have a large enough voting potential to influence the outcomes and to make it happen. They have to show up and engage - particularly in party politics.

Maybe this effort by Blakeman and Pastoor will help focus the attention of women and attract more of them to a more active political engagement. That would be a good thing...regardless of party and policy preferences. Time will tell.

Still this was an interesting proposition these two put forward - but futile politically given the size of the PC majority in the Legislature. Yesterday their futility came to fruition as Ken Kowalski was once again ensconced into the Speaker’s Chair.

The Liberal’s did score a political point or two by helping to elect Calgary PC MLA Wayne Cao as Deputy Speaker - and not the preferred first choice of the reigning government. I know the small Liberal opposition will have to enjoy this political "victory" while it lasts. This is likely the last time the PC Caucus will split in a way that the Alberta Liberals will actually determine an outcome.

Jim Prentice Kills Satellite Deal - The Right Thing for the Right Reasons

This week illustrates another reason why I value Jim Prentice as a politician and a person. The progressive and positive positions he has taken as Minister of Industry is a continuation of his quality governance capabilities. His move this past week to kill a sell off of a publicly paid for Canadian space technology is the most recent case in point.

He is a bright, thoughtful, competent and conscientious man with enormous personal and political skills. He is a former federal Progressive Conservative leadership candidate - and my choice in those days. He is obviously so far above the posturing pettiness and the blatant bullying of the majority of his Reform types CPC “colleagues.”

The proposed sale by Canadian company MacDonald Dettwiler and Associates Ltd. of our just launched earth observation satellite, Radarsat-2, to an American corporation, Alliant, is wrong at so many levels. Prentice knows this and has moved quickly to do something about it.

We have many issues of Canadian interests at stake here, including our sovereignty over the Arctic that the Americans and others are challenging. Those dealing would be seriously compromised with this commercial deal going forward. We also have the loss of technology that we Canadian taxpayers have paid for in large part…and the company would have pocketed the benefits – not us. Then there is the fact this technology is critical new 21st century infrastructure to boot.

Well done Mr. Minister and keep up the good work - and don’t let antics of the small-minded bullys that seem to be all around you get you down.

IMF Weighs In on Pending Global Credit Crunch - It is Not Pretty!

The plot thickens and gets gloomier around the consequences and impacts of the sub-prime mortgage fiasco. The International Monetary Fund has issued a new “Global Financial Stability Report” that says the fall out is “widening and deepening” as it spreads geographically and into corporate debt markets.

Now the financial institutions and security market firms are said to be coming under “considerable stress” caused a weakening of their balance sheets, the deleveraging process due to falling asset prices and the overall weakening of global growth…particularly in the States.

There is a quickening curtailment of credit that may start to impact normal business operations as banks cut back and try to raise capital. Central banks in Canada, the States and Europe are pumping cash into the system to provide liquidity and some semblance of short term stability.

The question remains about how much more money will be required to bolster the bungling and booga-booga economics of the Masters of the Universe types? How big and damaging will the bank’s asset write down actually be and how quickly will it happen – with what global economic consequences?

The system has been into denial for months but the vultures have come home to roost and with a vengeance. The impact is now being felt where 1 home in 5 in Detroit is under foreclosure. U.S Housing prices have dropped for the 9th consecutive month and last month alone a whopping 80,000 jobs were lost in the States...and as Karen Carpenter would say…”We’ve only just begun.” Former U.S. Fed Chair Alan Greenspan has said the States is already in a recession…too bad the current crop in charge can’t be that honest.

Those numbers are impressive and startling but they are nothing compared to the galactic calculations that are happening at the macro levels. Since August last year banks and security firms have written down $232 billion ($232,000,000,000.00) in assets and credit losses. The IMF predicted in February this total would reach $600 billion ($600,000,000,000.00). Two months later in April the IMF is saying the losses and write downs will be one trillion…$1,000,000,000,000.00. Obviously the worst is yet to come and indications are the biggest hump that will the system will have to get over will be in full force in the fall of 2008 and resonate for many quarters afterwards.

Governments are going to be called on to bail out these bozos who love to boast about how much brighter they are than the public service bunch who the like to look down their noses at. The lack of proper oversight by the regulatory authorities in government, their agencies, boards and commissions is a sad consequence of letting-the-market-decide-everything school of far right governing philosophies so “popular’ as of late.

Now we will likely see the reverse reaction and a tendency to over regulate and what I like to call the hardening of the Auditors. We will see a tendency to want to micro-manage and not regulate all in the cause of consumer protection and guarding the value for the taxpayer dollar. Business leaders better start taking the concept of social responsibility and social license to operate concept to heart as core values and not just public relations exercises if they don’t want to find themselves in personal lines of fire from a growing wave of fiercely angry citizens.

There is always lots of blame to go around history repeats itself where we see corruption and cons fueled by greed and abetted by a failure to properly perform public duties. The other truth seems to be every time history repeats itself the price goes up as do the consequences.

I Read Dunn and Valentine and I Still Don't Know If Albertans Are Getting Their Fair Share of Royalties

I have read “Building Confidence” the Peter Valentine document on “Improving Accountability and Transparency in Alberta’s Royalty System” that was released today. Apparently the former Auditor General was asked by the Premier to consider “oversight of the royalty system, a review and assessment of the government’s business processes and controls; and a performance measurement and reporting.” Mr. Valentine has made 13 recommendations that the Minister of Energy was quick to note today the all Valentine’s recommendations will be accepted by the government.

The genesis for this “Building Confidence” undertaking was in response to a report last fall by Fred Dunn, the current Auditor General, who criticized the government on how it reviewed and decided to adjust royalties. Dunn made 5 recommendations and it looks like Valentine has caught all of them in his report. Valentine has also made recommendations that make the Minister of Energy more accountable to Cabinet and therefore Albertans and not just the one-man-show “decider” of all things royalty related as in the past.

Valentine hired KPMG to help him out in his review. They were charged with reviewing the “source and nature of assurance the Department has over the accuracy and completeness of industry and/or other external data. They also were tasked to review the processes in the Department to collect external data and information used to assess the performance of Alberta’s non-renewable recourse revenue policy and collection of royalties. What KPMG was not asked to do was “review of calculations, data input, reporting and verification processes and controls that take place outside the Department, for instance in oil and gas companies and the Energy Resources Conservation Board.”

It is more interesting as to what was out of scope in both reports. Dunn did an analysis on conventional oil and gas and oil sands for a 5 year period starting in 2000. He also did not examine the system the Department used to calculate and collect the royalty and bonus revenues. He did not assess if Alberta Energy “…has adequate controls on the completeness and accuracy of data that form the foundation for royalty calculation.”

Dunn notes that in coming to a calculation for royalty revenues the government uses averages and scenarios covering a range of pool sizes and well characteristics from publically available sources. Industry on the other hand models well data outputs based on “confidential information such as the company’s financial parameters.” The upshot is government models royalty returns on “averages” to estimate economic rents but industry models the specific well or project to determine profitability and rate of return.

The two reports by Auditor Generals present and past are excellent documents but they both beg and profoundly fail to answer the foundational question…are Albertans getting all the royalties they are entitled to under the law? If we don’t know if the input data is accurate and if the model being used is adequate how can we tell? If industry uses one model and government uses another how can we cross check for accuracy in calculations?

Valentine says the Department settles for a vague answer to this foundational question. He says the Department “estimates that it will effectively collect 100% of the available return to Albertans by collecting 20%-25% of the industry’s net operating revenues.” Well my understanding is we have not been at this rate of return for royalties and recommendations by the Department to the former Minister(s) to return to that range of royalty revenues were rejected unilaterally by him/them.

Both Dunn and Valentine noted the royalty system in place no longer served the public interest in the days of high and fluctuating commodity prices. That is where Dunn identified the $1 billion of opportunity losses from uncollected potential revenues. Valentine says there is no substance to support claims we were missing collecting money but the admission of the various systemic flaws makes it difficult to square that conclusion with so many unknowns still unknown.

It looks like industry knows its own numbers on production and costs. Industry’s actual production numbers of our non-renewable resources belonging to Albertans should be made public and used for royalty calculations on a gross basis. Costs of doing business are individual corporate competitive issue and that data rightly belong to the industry players and not the public.

This dichotomy of data and cdifference in alculations between the industry private and the Alberta public interests provides us with a problem in determining if we are getting Our Fair Share. What needs to change is the royalty regime based on net revenues and move to a gross production and commodity price based calculation for royalties. That way we don’t care about the company’s costs of doing business and our government doesn’t need to make wild-assed guesses and averaging calculations to deem a production total.

Mr. Premier, you have two excellent reports on royalties now but neither of them adequately answers the single most important and fundamental question on the minds of Albertan…are we getting our fair share. Until that is answered authoritatively and authentically with information and evidence to back it up the job is not done and the foundational question is not answered.