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others if they have refinements that would aid everyone’s understanding about BCH. … Yes there needs to be an "accounting" for misuse and abuse of accounting regulations. For the last couple of decades governments have gamed the financial reporting system. The motivation is to bulk up the GDP number without having to book much new "debt". A few years ago John Doyle helped me understand a critical way governments can get their way with not much penalty. GDP is calculated two ways. The first is to add together all spending/investments made in the year. It is obvious the more a government borrows and contracts P3s and IPPs the greater will be the GDP. The second way is to calculate all the values added, more of a totalling of revenues, real or declared. The two ways should total the same in the end. For a long time the credit rating agencies looked at the ratio of GDP divided by the "debt". You can easily see that if a government wants a good credit rating then they work to get more GDP while at the same time keeping "debt" as low as possible. John explained to me that "debt" was a narrow term describing interest and principal repayment only driven by the calendar, not by any performance term. Because of the narrow definition, our Provincial "GDP to "debt" ratio appears good by comparison with other jurisdictions. However, if you open up the Comptroller General Annual Reports and turn to the

section contributed by the Auditor General, specifically the note to the balance statement and titled "Contingencies and other liabilities," you will find the amount the province is carrying as a liability, apart from "debt." The last fiscal year this was about $102 billion, a large share coming from the BC Hydro IPP contracts. If you go back into recent history you will see how this total has grown. These liabilities are overlooked when determining the "GDP" to "debt" ratio; at least that is my impression from a few years of asking folks about this matter. Credit rating agencies and maybe the auditors are getting nervous about this reporting gaming. So, for example, when the Minister said the mining industry could have a deferment on electricity bills until commodity prices rebounded, I expect this deferral is reported as a receivable by BC Hydro even though there is no cash from the sales. Doing that can only go on so long before people get upset providing the shareholders of the mining companies a subsidy or free ride.. I think the Enron story provides a number of lessons in accounting that relate to the BC/Hydro story. The establishment suppressed those declaring the "king (Enron) is not wearing cloths" yet in this he/they were not. I know of a few who said so before the collapse who were summarily fired. It is a good thing I am no longer in a job as an economist. Erik Andersen, twolabradors@shaw.ca ♣

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A Series Exploring Alternatives to the Monopoly of Corporate Power and Networks PART III – “Chaining The Beast” John Olsen, Parksville BC, August 2016 This series began in Dialogue Vol. 29, No.2. In Part III, John Olsen traces the rise of uninhibited corporate power and explores what will be needed in order to restore democratic governance.

The Asian elephant is a strong and useful servant of mankind but, should his mahout lose control, the animal can become a threat to the community he serves. He must then be chained. The modern corporation is such a beast. it “Corporatocracy.” To introduce the course, I pointed Not long before he retired, Ed Finn, then the editor of the CCPA Monitor, out that capitalism and the new nation, The United States of America, were born in the same year: 1776 for wrote a strong article on the subject both Adam Smith’s opus and the 13 colonies’ founding. of reasserting controls on corporations. He titled it, I reckoned that the confluence was significant for both “The Charge of the Left Brigade.” (Loved the title, Ed: parties to those coincidental births. it evokes both the heroism of the brigade and its futility in charging the enemy’s guns head on.) When I later looked up what Ed wrote about corporaIn 2006-07 I wrote and delivered a course for Vancouver tions, I saw that his treatment reflected his seasoned journalistic style and was more direct and parsimonious Island University called “Capitalism: the Second Coming.” After delivering it to the Nanaimo and Parks- than my more academic treatment: to each his own métier. Nevertheless, to introduce this contribution to …/ ville campuses, the next year I re-wrote it and re-named www.dialogue.ca

VOL. 30, NO. 1, AUTUMN 2016

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Dialogue Vol.30, No.1 digital edition  

Canada's unique volunteer-produced magazine for ideas, insights, critical thinking & radical imagination - shared in letters, essays, storie...

Dialogue Vol.30, No.1 digital edition  

Canada's unique volunteer-produced magazine for ideas, insights, critical thinking & radical imagination - shared in letters, essays, storie...

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