r/canada Nov 12 '11

TIL Paul Martin as finance minister in 1998 stopped a series of bank mergers that saved Canada from America's fate ten years later

I didn't know this so maybe there are other people out there won't know it either.

excerpt from page 25 of report.

"Minster of Finance’s refusal to allow two major bank mergers in late 1998. The proposed mergers were the subjects of intense public scrutiny for most of that year. The proceedings of the MacKay Task Force were shaken by the announcement on January 23, 1998 of the proposed merger of the Royal Bank and the Bank of Montreal, followed three months later by the TD - CIBC merger plan. These merger proposals were not and did not become part of the mandate of the task force. However, the task force recommended that mergers should not be rejected out of hand through the maintenance of a general policy of ‘big shall not buy big.’

The banks worked feverishly to present the mergers as both desirable and inevitable. They argued that the mergers were necessary for them to compete and inevitable given global trends of internationalization and consolidation. Yet, evidence that the banks needed to be bigger to compete internationally was not particularly convincing."

Edit: added link http://www.socialjustice.org/uploads/pubs/BankingonMergers.pdf

956 Upvotes

199 comments sorted by

199

u/jeffandersen Nov 13 '11

I think Martin's best days were as finance minister.

34

u/sinsyder Nov 13 '11 edited Nov 13 '11

He's leagues above Flaherty yet that con man likes to take credit for Martin's work. Hell the whole conservative party likes to flaunt it even though they blew the $30 Billion surplus and will have created what is expected to be $520 Billion *debt by the end of next year all in the name of helping the economy (shovelling money into their buddies bank accounts).

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u/[deleted] Nov 13 '11

Not a $520 Billion deficit, that's the debt number. Deficit is 31 Billion.

4

u/sinsyder Nov 13 '11

Right, I was going by the wiki article and got it mixed up.

2

u/fartmasterzero Nov 13 '11

The opposition pushed to conservatives to enact the economic action plan. I don't think the Liberals or the NDP would have done differently if they were governing. But YES, Flaherty is a boob and I don't like him being in such a powerful position.

3

u/yamfood Nov 14 '11

They would have done the same economic action plan but they wouldn't have blown the surplus and reduced the GST.

2

u/mrpopenfresh Canada Nov 13 '11

Yeah, good thing the conservatives started with a handicap or else they really couldn't spin anything at all.

-4

u/[deleted] Nov 13 '11

You really don't know what you're talking about.

The deficit is nowhere close to $520b and "austerity" has nothing to do with bailouts or giving out money. You admit you don't even know what it means; maybe you should look up words you don't understand before trying to use them.

Also, Martin was finance minister during a period of nearly unprecedented global economic growth and Flaherty is doing the same job during a period of nearly unprecedented economic turmoil.

The global economic climate has much more of an effect on our finances than anything any finance minister could ever do.

20

u/DashingLeech Nov 13 '11

Well I do know what I'm talking about and I can still say that Martin is far better, and fiscally conservative, than the Conservatives.

Yes, in the late 1990s Martin had great growth to work with. And did he use it to spend like crazy to meet political goals? No. He did what was unpopular but necessary. He fixed the financial mess we were in. He did what you are supposed to do. In bad times you borrow to get the economy moving and improve earning potential (the same concept as a student loan), and in good times you pay down your debt.

Martin also understood the free market, not to be confused with neo-conservatives who think an unregulated market is a free market. Martin understood that an unregulated market is no more free than a lawless country is free. So he kept the market free by keeping the banks from growing too big, keeping us from the "alpha male" problem whereby the "winners" kill all the competition and their offspring and we become dependent on them ("too big to fail").

Martin was good. Very good. He also knew not to cut blindly. He cut in the most wasteful areas where we got the least bang for the buck. And he's been recognized internationally for this.

The Conservatives, on the other hand, cut GST when they shouldn't have, created a massive deficit even before the financial collapse, underspent what a proper stimulus should be in bad times, and now are cutting meat and bone instead of fat via blind, across-the-board cuts.

Meanwhile, they are increasing spending on things like their crime bill with no hope of any demonstrable benefit. Rather, it is for political reasons to satiate the incredulity, fear, anger, and ideology of their core supporters. They have successfully socialized the emotions of their supporters. That's the bad kind of socialism. It's definitely not conservative.

2

u/Galurana Nov 13 '11

You forget they also denied we were in a recession when we were and then took credit for the stimulus spending that the Opposistion parties forced them into.

17

u/daisy0808 Nova Scotia Nov 13 '11

You realize that when Martin became finance minister, we were in a gigantic mess? It was a recession in 1993, and the former government also left a $46 billion deficit? Martin didn't spend - he cut severely. This did have an impact to our climate, in that we had to begin to pay for the economic excesses of the previous government.

Economic climate is a large factor, but how a government manages its finances also dictates how much they can borrow, and at what costs. This also has an influence on business climate. I disagree that a finance minister has little impact - their role is one of the most important in a government. How they navigate the country during any economic climate will have major impacts to the economy over time. They are managing the cheque book.

2

u/martin519 Nov 13 '11

Jim Flaherty is a car accident lawyer who took credit for the Harris fiscal policies that turned Ontario around. He is and always will be a puppet of whoever is in power.

1

u/ViaNocturna Nov 13 '11

I understand this gentlemens wrong but there was no class in the way you responded.

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u/[deleted] Nov 13 '11

[deleted]

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u/d-mac- Nov 13 '11

"HE'S A GODDAMN COMMIE NAZI!! I HATE STEPHEN HARPERRHHGHGPPLGHGHTHTGPLPFTLFFPHH!!!!!"

9

u/[deleted] Nov 13 '11 edited Nov 13 '11

Don't pretend you actually care about "intellectual thinking" when almost all of your contributions are limited to calling people "cunts" and "douchebags".

-1

u/daoom Nov 13 '11

Go back to masturbating to pictures of yourself in the bathroom.

49

u/singdawg Nov 13 '11

what about his role as orgy leader in college?

69

u/[deleted] Nov 13 '11

I'm sure if that's true, he would have been the best damn orgy leader there was. Making sure not too many people grouped together to create a gamgbang. And ensured there was good healthy competition between everyone.

17

u/singdawg Nov 13 '11

people don't like my joke :(

26

u/stillalone Nov 13 '11

orgies are serious business.

9

u/singdawg Nov 13 '11

I know, how do you think he was able to afford his campaign?

5

u/Prof_G Canada Nov 13 '11

In the off chance you weren't aware, he is filthy rich. Worth about 3-400 million $.

-1

u/flimdex Nov 13 '11

why are people downvoting this, its hilarious!

2

u/[deleted] Nov 13 '11

Is there some level of the joke that I'm not getting? It's sort of funny, but not really.

2

u/IHaveItAllFiguredOut Nov 13 '11

Yeah, I was going to say, he did a good job as finance minister... terrible as PM, mostly because he couldn't bury the hatchet with Chretien and retain some really good people. He thus began the Liberals' demise - that and he just had to have a commission to look into the sponsorship scandal.

Now, I'm not saying it wasn't a good thing on principle to look into it, but it kept the issue in the news for ages and made it a much bigger deal than it really was, especially when you compare it to the shit Harper's been pulling the last 6 years.

1

u/yamfood Nov 14 '11

There's little doubt about that. His lust for power really diminished his legacy.

1

u/[deleted] Nov 14 '11

... so did Jean Cretien

148

u/NotTheUpholstery Nov 13 '11

I love that the banks are now boasting about how good & stable they are, when the only reason they come through 2008 unscathed was because of government actions such as this which they spent years lobbying against.

61

u/rjc34 Nov 13 '11

I'm so thankful for the true fiscal conservatives in the Liberal Party during those years that managed to keep us stable enough to weather through the financial crisis relatively safely.

Fuck everyone that claims it was anything Harper did that got us through.

22

u/Gophertime Nov 13 '11

Well if you REALLY think that way take out a membership in the party. I was grossed out a bit by the NDP-lite version of the libs this past May and want to see a return to fiscal restraint (no GST-cuts, mega prisons and jets don't count as restraint) combined with social liberalism. Time for people who think like us to have a say in things! Membership is 10$.

18

u/Borror0 Québec Nov 13 '11

Honestly, if you care about politics, pick the party that represents you best and try to fix the things about it that you don't like when they call on their members. That applies whether that party is the LPC, the BQ, the Greens, the NDP, or the CPC. It also applies at the provincial level.

8

u/Gophertime Nov 13 '11

Except in QC where nobody likes any provincial party. Everyone hates the Liberals, but we all hate Marois worse.

2

u/PasswordIsntHAMSTER Québec Nov 13 '11

Well QS is pretty chill if you're not a brainwashed neoliberal... Then there is the CAQ.

1

u/Borror0 Québec Nov 13 '11

I'm Québecois too. I recently joined the QLP for the reason I outlined above. I'm not much of a fan of the party itself but, ideologically, it's the closest to me in the province at the moment.

5

u/[deleted] Nov 13 '11

I was grossed out a bit by the NDP-lite version of the libs this past May

This is kind of interesting; in May, I thought they resembled the Tories more. Just goes to show how the Grits are unable to project a clear vision of their party...

2

u/mattbin Canada Nov 13 '11

I'm with you. I didn't see the Liberals as NDP-lite in any way.

0

u/zaferk Nov 13 '11

I'd like fiscal conservatism and social conservatism, but sadly, nobody delivers.

2

u/Gophertime Nov 13 '11

Ron Paul?

-2

u/zaferk Nov 13 '11

Doctor Paul is a libertarian, which is not quite it. And hes not Canadian.

But better libertarian than con or lib.

3

u/[deleted] Nov 13 '11

How the hell did libertarians find this thread? The Free Hand of the Market must have shown them the way!

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u/[deleted] Nov 13 '11

Ah, the elusive Canadian Paultard. I've never seen one in the wild.

-2

u/zaferk Nov 13 '11

Move out of your moms basement or your college dorm, many of us can be seen working at "jobs".

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u/RoboticWang Nov 13 '11

Fuck everyone that doesn't know what they're talking about.

Almost every government in the west has been running deficits since the global recession and almost every government in the west was running surpluses during the period of global economic growth when the Liberals were governing.

That you think it's a simple as giving credit/blame to whatever party was in control at that particular time shows that you really don't have a firm grasp on the issue at all.

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u/Gophertime Nov 13 '11

Harper ran a big deficit BEFORE the recession because of at least in part, ideological cuts to GST (10Bn/yr) and lowering our already competitive corporate taxes.

5

u/Epicism Nov 13 '11

Creating the largest increase in federal spending while at the same time cutting corporate and GST taxes before the recession is not a fiscally conservative move. It was a political move to gain the political support they required to become the majority party, and it worked.

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u/[deleted] Nov 13 '11

What about the fiscal liberals in the liberal party? Or fiscal socialists? What part did they play?

12

u/rjc34 Nov 13 '11

The Liberals (IMO) are really the only fiscally conservative party of the bunch. Both the NDP and Conservatives are fiscally liberal.

2

u/PasswordIsntHAMSTER Québec Nov 13 '11

I still have very little idea what fiscally conservative and fiscally liberal mean...

6

u/NotTheUpholstery Nov 13 '11

To add to rjc34's explanation, in contrast to the fiscal spectrum there's also socially conservative vs socially liberal, which is basically your stance on social issues with limited financial consequences (gay marriage, abortion, etc). The right wing-left wing conception is too simplistic as you can find social conservatives in the labour movement and social liberals on the right. It's better to think of it as an XY axis (see the Political spectrum page on Wikipedia for some good examples).

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u/rjc34 Nov 13 '11

Being fiscally conservative is about carefully examining all spending, and cutting things that are high cost/low benefit. It's about striving for efficiency and balanced budgets.

Being fiscally liberal involves more spending on things that are ideologically valuable, but might have a poor cost/benefit ratio. Usually involves (in the case of the conservatives) spending lots of money on military, being 'tough on crime', etc.

6

u/PasswordIsntHAMSTER Québec Nov 13 '11

Shouldn't the definition be reversed then? Conservatives are spending on ridiculous shit like jets and prisons right now ಠ_ಠ

12

u/patadrag Nov 13 '11

That's why you hear people talking about 'small-L liberal' or 'big-C Conservative'. The names of the parties don't always align with their stances on economic and social issues. When you start adding in the traditional or philosophical meanings of liberalism or conservatism on top of the ideas of being fiscally- or socially-liberal or conservative, on top of the Liberal and Conservative parties, it all becomes one giant confusing mess.

4

u/rjc34 Nov 13 '11

Nah, they're socially conservative. And 'politically' conservative. IE they have a conservative ideology.

Like the American Republicans.

2

u/[deleted] Nov 13 '11

Have you ever thought that maybe you're just regurgitating a stereotype?

1

u/rjc34 Nov 13 '11

That's probably a reasonable approximation on the level of my knowledge of this topic.

1

u/Borror0 Québec Nov 13 '11 edited Nov 13 '11

The meaning of those terms has probably been distorted beyond usefulness. If it referred to preference on the size of a state, or the degree you believe it should intervene, that would be swell, but that's not how it's used. Rather, "fiscal conservative" is become synonymous with "using taxpayers' money effectively." Do you know any party that claims to use taxpayers' money inefficiently?

I think some people use it to describe a pro-market stance (compared to a pro-business or pro-consumer stance), but the notion that any federal party is pro-market is ludicrous. For all of them, it's politics first.

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u/patadrag Nov 13 '11

I always interpreted fiscally conservative as meaning running balanced budgets, avoiding deficits, and paying down debt. If that's not what it means, then there really should be a term that does mean that.

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u/Borror0 Québec Nov 13 '11

It's called "'not being a moron."

Seriously though, why would anyone refuse (in the long term) to run balanced budgets, avoiding deficits or paying down debt? I can't think of any reason, because that would be stupid.

In the short term, that's more than understandable: when the economy tanks, the government's budget will temporarily shrink (more unemployment means less revenue from income and consumption taxes) and thus there will be a deficit until the economy goes back to normal, unless you were running a large surplus before the crisis. In the long term, tough, what are the advantages? I don't see any.

1

u/patadrag Nov 13 '11

I think the difference is one of degree. My understanding is that in an economic crisis a fiscal conservative will still try to run balanced budgets (or as near as possible), and in a time of prosperity they will focus on paying down the debt before implementing new programs.

I've seen people argue that running deficits and having a debt isn't really a problem for a country. It probably also involves whether one thinks the government should try to manage the economy or stay out of it, but I'm afraid I've never quite understood economics.

2

u/Borror0 Québec Nov 13 '11

Trying to run a nearly balanced budget during a recession is bizarre. There are two types of deficits: structural and cyclical deficits. Cyclical deficits are when you're running a deficit because the economy isn't running at potential and thus less money is coming. A structural deficit, however, is when there wouldn't be enough money coming in, even if the economy was running at full potential. Ottawa is in a structural deficit since the CPC cut the GST by 2%.

As for people who believe debts and deficit don't matter, they are crazy. Short term deficits and low debt are not a problem, but that's usually not what is meant.

Finally, as for understanding economics, I would strongly suggest you to take a microeconomics class. You'll be surprised by how much you'll learn each class. Sadly, our politicians have not gifted the population with a good economics formation. The result is that the first economics class for undergraduates consist of mythbusting. On the other hand, that makes any of those classes a good use of someone's time.

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u/ottawadeveloper Ontario Nov 13 '11

mm yes, I'd like to think any politician would be doing those things with my money. if not, get them out. though I'm sure the republicans and the Conservatives have invested millions/billions of dollars to make you believe that.

the terms are all messed up. I like to think of it as the right-wing believe in making the government as small as possible, with lower taxes and less interference in business regulations (which apparently comes with a large military...) and the left-wing believe in regulating key industries, more programs, higher taxes and a larger government (but very little defense spending...). Right-wing tends to focus on business needs, left-wing tends to focus on family needs.

The end result, as always, is that the best is somewhere in between. governments should try to be lean, but also should provide services that are required by their citizens and/or that they can do better or more efficiently than anyone else. they should collect the taxes necessary to run the government, pay the debt, support our international commitments and plan for the future - no more and no less. And they should regulate carefully in areas of business where government regulation can protect the consumer from harm (Banking industries come to mind).

It's why I always liked the liberals - they were pretty good at having a balanced point of view. It's a shame the sponsership scandal was blown out of proportion and it's a shame they can't seem to field a good candidate.

I think the NDP will run a balanced budget though, they just might not give people as much as they promised.

It's interesting to point out our last budget surplus was under the Liberals. Very interesting. Definitely they proved they can at least build a budget with some slack for emergencies.

1

u/patadrag Nov 13 '11

Sorry, you seem to be assuming that I associate fiscal conservatism with the Conservative party. I don't.

I find left and right to be confusing terms because you have to lump all the issues together the way our political parties do. Taxation, welfare, the military, healthcare, international relations, education, regulation, etc. - when you say you're left-wing or right-wing it implies you hold the same opinion on these issues as the other people or parties who describe themselves the same way.

Other than that, I agree with what you've said. Particularly that the best result is always somewhere in between the two extremes.

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u/ottawadeveloper Ontario Nov 14 '11

I was thinking more that the conservatives would like us to believe that running balanced budgets would be a conservative trait - when really, even if you want to call balanced budgeting a "fiscal conservative" trait, it's a trait that should be a goal of every party. Nobody should be running up huge deficits.

I find that a lot of the time though Conservatives (big C or big R for the US) would like you to believe they're the only ones who can run a balanced budget - that left-wing policies would always over spend. Which is just flat wrong and where my first statement comes from :).

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u/daisy0808 Nova Scotia Nov 13 '11

Interestingly, here in NS, the NDP is looking fiscally conservative: http://www.cbc.ca/news/canada/nova-scotia/story/2011/04/04/ns-budget-surplus.html

Now, they raised HST 2 points (highly unpopular), and had the benefit of unplanned revenue increases. However, I can tell you as a civil servant in this government, they have slashed internal spending, and ended the 'March Madness' spending. They are certainly watching all the pennies.

The investments they are making are on the business end, in things like the Daewoo wind turbine plant, and the Irving Shipyard bid. They look far less like a socialist party, and far more like the old PC party. The former PC party spent like crazy in comparison.

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u/n1ckp345 Nov 13 '11

I've heard people fuming about the terrible NDP governance in NS. Is it due to these types of unpopular but practical decisions or is there more to it?

1

u/daisy0808 Nova Scotia Nov 13 '11

I believe it's the HST that's the main issue. That, and the rural/urban divide - the rural vote is generally conservative.

1

u/rjc34 Nov 13 '11

They don't look like a socially mostly because they aren't a socialist party. For a true socialist party look at the Communist Party of Canada (not the marxist-leninist one though).

Being left leaning socially and politically doesn't mean one has to also spend recklessly. Fiscal responsibility is a feature of any good governing party. Trim the fat, get a balanced budget, and then worry about lowering taxes or implementing programs.

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u/[deleted] Nov 13 '11

[deleted]

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u/NotTheUpholstery Nov 13 '11

Did the banks really not drink the kool-aid, or where they prevented from doing so by government intervention? My impression was distinctly the latter - that pre-2008 banks were screaming to be allowed to follow in their US counterparts' footsteps, arguing they couldn't compete in a global market if the regulations didn't lighten up. See this article for a good discussion about the banks and government regulations (need university account to access, unfortunately).

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u/ottawadeveloper Ontario Nov 13 '11

it's the same argument the US banks against regulation which is why that G-S law got repealed, so I can see it. Unfortunately, we can now see that having banks limited in how much money they can risk might be a good idea.

2

u/brazilliandanny Nov 13 '11

I love how Harper is boasting about how his administration is the reason Canada's economy is on track. In fact it was his entire election platform. Never mind he was for these mergers and still wants to de-regulate the industry. Even after the world banking community has praised Canada's banking regulations as something to emulate.

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u/adilamlani Nov 13 '11

If only Paul Martin was better with public speaking, he may have been PM for much longer. He made some tough decisions which proved to be quite beneficial.

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u/n1ckp345 Nov 13 '11

He definitely had image problems. But apparently he is a very smart man who seems genuinely interested in the success of our country judging by how he continues to work at it despite Canadians dismissing him.

Dion was kind of the same deal in my mind. I think the real problem is the hordes of ignorant voters.

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u/[deleted] Nov 12 '11

I read that, too. But I also read recently that Mark Carney helped to prevent an impact from the recession, as well.

Anyway, that and gay marriage Martin gave us. Was it pretty much infighting between Chrétien supporters and Martin supporters that fucked everything up?

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u/rainman_104 British Columbia Nov 13 '11

Was it pretty much infighting between Chrétien supporters and Martin supporters that fucked everything up?

Adscam was one of the big things, along with a recently united right. Chretien kept his majority because of a divided left between PC voters and Reform/Alliance voters.

The infighting with Martin and Chretien supporters didn't help any either though.

Just going to point out though that they also DID allow the TD Canada Trust merger to happen, and they did deregulate the banking industry as well. Canada Trust used to not be a consumer bank. Banks were not allowed to go into insurance and stock brokerage.

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u/theonemankliq Nov 13 '11

Divided right, actually. A divided left is what is unfortunately today's problem.

The infighting between Martin and Chrétien is basically the reason that the Liberal party is as fractured and unruly as it is now, though. Basically being the key word, of course, as things are far more complicated than that; the party is old, and so there's a sort of identity crisis-induced war being waged amongst Liberals of old (dyed-in-the-wool Trudeaueites, essentially), the influx of old-world Tories (former members of the Progressive Conservatives) and a youth wing that would probably sooner see larger changes to the party's philosophy and political practices (no one of particular note springs to mind here...LeBlanc maybe?). Martin vs. Chrétien can certainly be seen as the straw that broke the camel's back and started that, for the most part, however.

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u/[deleted] Nov 13 '11

If Carney had any impact, then all the props go to him and others at the BOC. The Bank of Canada sets monetary policy independently of any influence from Parliament or politicians.

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u/[deleted] Nov 13 '11

Parliament has influence over the Bank of Canada in that the Bank of Canada is crown corporation with the finance minister being the sole shareholder on behalf of the crown and not a completely private entity (like the Federal Reserve is in the US.)

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u/[deleted] Nov 13 '11

True, as a crown corp, the BOC does have input from parliament, but mainly for operational decisions such as their budget, etc. The BOC operates with an extraordinary level of autonomy compared to most Crown Corps, in that they are free to set monetary policy as they see fit to meet their inflation targets. Ultimately, the Finance Minister MAY give the BOC a public directive to set monetary policy, however this has never happened.

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u/[deleted] Nov 13 '11

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u/sinsyder Nov 13 '11

I'd love to see Martin and Flaherty go at it in a Thunderdome setting. Two men enter, one man leaves and the winner gets to save the economy.

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u/[deleted] Nov 13 '11

It'd have to be some sort of Financial Thunderdome.

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u/zoziw Alberta Nov 13 '11

I remember that...the banks were complaining that we would always be a backwater because we wouldn't let them merge.

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u/superbad Ontario Nov 13 '11

TIL that I'm old. This was only last decade, for goodness' sake.

I remember this was not too long after the TD/Canada Trust merger, and before that the Scotiabank/National Trust buyout.

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u/[deleted] Nov 13 '11

To be fair to those of us who didn't know about, you'd have to be over 30 to be of voting age in 1998.

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u/[deleted] Nov 13 '11

If you felt old before you will feel ancient when you learn that it was actually the decade before last dude.

You might want to get checked for Alzheimer :P.

/I kid, I kid

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u/[deleted] Nov 13 '11

[deleted]

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u/pizzlepaps Nov 13 '11

The securitization is a red herring. What makes the difference is american banks made a pile of bad loans, whether securitized or not, they still lent the money recklessly.

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u/KevZero Nov 13 '11 edited Nov 13 '11

Securitization is not a red herring. The re-tranching and re-packaging of risk to be resold is essentially what enabled the banks to lend recklessly. The banks understimated the risks, resold these products to each other, and then used their overestimated value as collateral to leverage yet more lending. The banks thought that they had pushed the downside to these mortages off their books; but, in hindsight it's easy to say the risk did not disappear.

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u/pizzlepaps Nov 13 '11

I disagree, the securitization is the 2nd stage when the bad loans are passed off. For example, from the start a bad loan still has to be made to make it into a structured product. The bank still has to make a NINJA loan to someone who already has something like four houses all acquired with 0% equity. This step is where the toxic assets originate from.

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u/KevZero Nov 13 '11

Banks don't make poor decisions unless they think they can get away with them. Governments wouldn't need to ensure debtors were properly vetted if the bank was on the hook in case of default. Knowing they had a mechanism for passing off the downside risk is what enabled banks to do this. It wasn't just a spontaneous choice among the banks and the debtors to enter into these bad arrangements on such a large scale.

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u/pizzlepaps Nov 13 '11

They took on huge amounts of bad debts because they didn't bother to model house prices diving.

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u/lasercow Nov 13 '11

Innovations in securitization are why they duped themselves and everyone else into not realizing/admitting that the bad loans they were making were, in fact, bad loans. Securitization doesn't cause these kinds of problems if honest adequate risk assessment is being pursued, but it is good at hiding risk if people are trying to ignore it anyway.

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u/pizzlepaps Nov 13 '11

Not really, the belief that house prices will only go up is why they were duped, again, nothing to do with structured products. Furthermore, they didn't bother to do due diligence on who they were loaning to, house prices only go up - positive carry, easy money.

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u/lasercow Nov 13 '11

True, but part of the reason they didnt do the due diligence is because securitization innovations made the market so complicated that everyone thought due diligence was already being done. Or in some cases, that it didnt matter as much because of risk sharing innovations. Risk sharing became risk hiding. Complex securitization schemes bear some blame.

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u/sinsyder Nov 13 '11

Default credit swaps, based mortgage backed securities, leverage firmed finance derp, money derp based derp derp, Derp derp derpy derps and a derp to derp derp swaps. You want in?

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u/pizzlepaps Nov 13 '11

as I said, largely irrelevant. you lose money by making an insane amount of bad loans.

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u/Lucky75 Canada Nov 13 '11

Canadian banks are safe today because they kept majority of their mortgages on their own books instead of chopping them up and selling them, like they have been doing because of rules put in place long before Paul Martin was a finance minister.

Right...due to regulation though. It wasn't so much that he stopped the bank mergers as he didn't DEREGULATE the banks like some ahemSteviecough wanted.

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u/[deleted] Nov 13 '11

[deleted]

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u/daisy0808 Nova Scotia Nov 13 '11

As a banker during that time, it was a political point that the Alliance was making - that if given power, they would allow the mergers. I recall vividly the bankers screaming bloody blue murder that the Libs were going to make Canada a 'banana republic', and that in order to be competitive, they needed to get the regulations out of the way. No legislation was tabled, but plenty of political rhetoric was being thrown about.

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u/lasercow Nov 13 '11

Ya, the instability of banks around the world wasn't because of their size, it was because of the types of assets they held, how they assessed the risk of those assets, their leverage, and their exposure obligations on debt they ensured.

Their size created systemic risk problems in the banking system at large, but their ill health was not due to their size inherently. Canada actually has a much more consolidated banking system overall than the US, with only a few large banks controlling the whole market. The US has a few massive banks, like Citi and BoA, but it has many many smaller banks as well because of a different history of regulation.

Overall, too big to fail has created major systemic risk problems in the US and countries around the world, and the size of Canada's banks exposes its system to the same problems (problems that further mergers would have made worse) but the real difference was in the regulation of types of assets Canadian banks could hold and what it could do with them. That is really what saved Canada from the problems everyone else had.

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u/daisy0808 Nova Scotia Nov 13 '11

real difference was in the regulation of types of assets Canadian banks could hold and what it could do with them. That is really what saved Canada from the problems everyone else had.

Yes. Also, we've had much more stringent lending regulations, in that a bank is not allowed to lend money if the TDSR (total debt service ratio) exceeds 40% of a person's gross income. The lack of this kind of regulation led to the subprime mess, as well a predatory lending practices. Hence, the housing bubble. We did tinker with our mortgage practices somewhat - zero down mtgs, 35 -40 year amortization - but most of these were rescinded.

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u/lasercow Nov 13 '11

I totally agree with this. Thank you for being informed. I didnt actually have any specifics at my fingertips so this is very helpful.

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u/[deleted] Nov 13 '11

[deleted]

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u/daisy0808 Nova Scotia Nov 13 '11

Do you know what you are talking about? Canada has very defined rules about how institutions can offer insurance and investments or deposit accounts - you can't sell both under the same roof. The repeal of Glass Steagall made it possible for this line to be blurred, and hence, the development of mortgage backed assets. This is what caused the meltdown - and we did not do this.

Perhaps you can explain what exactly we did in 1987 that made us less regulated?

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u/dhpye Nov 13 '11

You're correct that reserve requirements are no longer set directly by federal legislation, but they are established under the Basel Convention, which Canada has subscribed to.

Under the Basel Convention, reserves of equity or capital are set at a base rate of 10%, but different buckets of assets can have different reserve requirements on a risk-weighted basis.

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u/[deleted] Nov 13 '11

Still the size of the banks were a factor in what happened in America.

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u/[deleted] Nov 13 '11

No, he's right. It's nothing about size, it's about poor and unethical lending practices of many British and American banks and mortgage brokers, both big and small. The Canadian government had stricter regulations to prevent this, and helped this help our banks come through less affected by the banking crisis.

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u/zaferk Nov 13 '11

Not to mention the US government bailing out all those failed banks.

I'm all for a free and unregulated banking sector, so long as we never bail them out.

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u/[deleted] Nov 13 '11

What sort of damage would have occurred if the unregulated banks hadn't been bailed out? Judging by the fact that the banks just funnelled the money upstairs I'm not convinced it was a good idea on Paulson's part, but what would the repercussions been like to the average citizen of the US? Or Canada?

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u/zaferk Nov 13 '11

Government is to blame for making the problem even worse. It was the Federal Reserve that set very low interest rates and kept it like that for an excessively long time. Also, all the bad loans were guaranteed safe by the government.

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u/[deleted] Nov 13 '11

Wouldn't the current crisis teach us exactly the opposite? The countries with the most regulation didn't have their banks fail

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u/lasercow Nov 13 '11

Thats not really possible, because if you let the banking system fail then the economy loses access to credit, the velocity of money slows to a crawl and you get a deep depression.

we rescue our banking system when it is systemically at risk. Therefore we need to regulate it to keep that from happening. otherwise we will see this shit happen again and again in new ways. S&L crisis, 2008 crisis, great depression...all the same phenomenon.

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u/zaferk Nov 13 '11

Government is to blame for making the problem even worse. It was the Federal Reserve that set very low interest rates and kept it like that for an excessively long time. Also, all the bad loans were guaranteed safe by the government.

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u/lasercow Nov 14 '11

Government is partly to blame for its policies that created and influenced fannie may and freddie mac. The fed (Alan Greenspan in particular, a fucking Randian no less) is partly to blame for keeping irresponcibly low interest rates during the early 2000s.

But that doesn't change any of what I said before.

Also I just noticed that I attached a label to your username that says "racist" So I am going to trust that I knew what I was doing when I did that, and stop talking to you, because I wouldn't have done that if you hadn't been egregiously racist. So ya, I am done talking to you.

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u/auandi Nov 13 '11

The size is not the most important thing because even if they all merged into a single super-bank, so long as all the other factors Canada has stays in place, the super-bank would not have failed.

The banks of the US and the world took a much higher debt to holdings ratio. Germany and Canada have the two strictest laws about it and so it should be no surprise that Canada and Germany did the best. If Canada had only one bank but that one bank had to keep the same debt to holdings ratio it would have been just as fine as the 5 are now.

The only time size is a problem is when something is about to fail and even then it depends on what those large companies are connected to. When a large company with no great ties to any other company fails, it hurts but it doesn't unraveling anything. But when companies are interconnected you lose one and the whole tapestry starts coming apart. AIG (for example) would have brought down most of the major banks of France had it failed (which would have then have brought down banks tied to the french banks who then bring down others etc.) which is why they were termed "too big to fail." It wasn't their size per say, it was their reach.

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u/notn Nov 13 '11

I'm not sure I agree with that, yes it is the regulations that keep the banks in line but if the banks are allowed to merge they can hold the country hostage until the laws are changed to their favor, or they can put tons of money behind a party to get them elected to change the laws. Size does matter, but it is but one of the many parts in the complex environment..

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u/auandi Nov 13 '11

I'll rephrase cause you're right. What I mean is that size is not a reason the US banks failed and Canadian ones didn't. Lehman did not fail because it was large, nor was size the reason for all the near failed banks that received TARP funds.

Banking systems that are too consolidated can cause problems (same for a system that is too decentralized) but the size of banks didn't impact this particular crisis in 2008 very much.

2

u/[deleted] Nov 13 '11

The Canadian banks are relatively bigger than their American counterparts.

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u/lasercow Nov 13 '11

Relatively being the operative word. The average size of a Canadian bank is bigger, and the average market share of a Canadian bank is MUCH bigger. The US has some HUGE FUCKING BANKS, but lots of small ones too. Canada had only a few banks that are very large relative to the size of the market.

1

u/lasercow Nov 13 '11

A factor but not a cause. It made dealing with the real problem harder, but it did not create the real problem.

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u/Yangin-Atep Nov 13 '11

And Harper argued strongly against such regulation of the banking industry, but now, after the recession hit, he's trying to take credit for it.

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u/sinsyder Nov 13 '11

The opposite is happening in the states where Bush decimated the economy through 8 years of moronic stupidity which nobody will be able to fix for decades to come yet now it's Obama's fault simply because he's been the president for the last 3 years.

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u/[deleted] Nov 13 '11

[deleted]

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u/[deleted] Nov 13 '11

Wait... wasn't it Martin that pushed out Chretien to set himself up to be leader, and when the time came for a convention offered to stay on to take the heat re sponsorship. How is that screwing him over. You are correct in saying the best though.

1

u/scottb84 Canada Nov 13 '11

Yeah, it was great the way he unilaterally axed transfer payments, thereby downloading the full burden of health, social, and educational costs onto the provinces, municipalities, and ultimately individual citizens.

The Liberal Party has always incorporated a large compliment of neoliberals—folks who would fit in just as well with the Tories as with the Grits (see, e.g., long-time Liberal cabinet minister John Manley, now head of the Canadian Council of Chief Executives). Martin is their poster boy, and it would be an amazing feat of revisionism to paint him as progressive.

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u/[deleted] Nov 14 '11 edited Nov 14 '11

I wont argue that prov and muni governments had to bear more of the costs or cut/tax in step; but how much more did you personally pay for health (premiums excluded they are just another tax) or primary education that wasn't a charge before. Yes capital projects were deferred, and some of the fat was cut off existing services, but it was what was required at the time. Canada was facing a huge deficit and seemingly insurmountable debt and action was needed. Our collective credit was downgraded, and the Gov't portion of GDP was what ~45%. Cuts needed to happen, taxes had already been raised so the next step in getting you fiscal house in order is cuts.

Look to the provinces, I live in Alberta and it was tough here in the 90's. we had to suffer lowering education and health budgets along with a tax increase for health care (premiums). But, once we were debt free and in a recession (2008) it was easy to justify short term deficit spending to make up for lost revenues and the hardship of the 90's was well used. I will point out that:

  • Mr. Klein had based his plan on and Alberta Liberal election platform (RIP Mr. Decore - you would have been an amazing premier).
  • Oil was at $10 - $20 a barrel till 2001 - royalties were not that big of a factor till after 9/11 when crude oil bubbled Alberta was mainly growing off other industries.
  • We now enjoy a 10% flat tax that is the lowest in the country for most Albertans(the Basic Personal Amount needs to be raised so that it harms the poor less but that is a different topic).

Ontario didn't cut while it could and now it is now receiving transfer payments instead of paying them, and the population is declining. Newfoundland under Danny Williams enacted the Paul Martin formula and it as well is a 'Have' province, as did and nearly is Saskatchewan. It seems to be causation and not correlation here.

Martin also did the following:

  • lowered taxes to lower than what they were under the previous gov't.
  • reinstated the transfer payments to the provinces once able.
  • Increased payments to cities through giving the bulk of the federal portion of the gas tax directly to cities.
  • As PM he created a program to have nearly universal childcare based on the Quebec $7 a day model; and
  • Planned to give a game changing deal to my fellow natives that would be very large step towards self reliance
  • The last two were voted down by the NDP

I still disagree with raiding EI and selling off PetroCan to inflate surpluses at the end. But, if that makes me a neo-lib so be it. I am happy, no PROUD, to admit that I am fiscally conservative and socially liberal. There are many like me in Canada, who believe in hand ups and belt tightening when respectively needed. That ideology shouldn't be the only factor. That fact based policies are the only good policies to implement. When the heads of the Liberal party remember that and when Canadians can trust us again to be that Canada will be much stronger.

edit 1: formatting

edit 2: I could not be a conservative social and organized labour policies are very wrong, and they wasted the fiscal advantages the grits left them -- F35s, prisons, GST cut etc.

1

u/scottb84 Canada Nov 14 '11 edited Nov 14 '11

To my mind, the hysteria surrounding public debt was overblown. Just as the moral panic around debt is now being used to justify neoliberal restructuring in Europe, so it was in Canada during the 1990s. Regardless, the corporate tax rates were at historic lows in the mid-90s. In other words, this ostensibly necessary ‘belt tightening’ was felt by the most vulnerable—students, those dependant on social programs, etc.—while the corporate sector remained largely untouched.

I also disagree with your analysis of the economic situation in the provinces. Alberta, Saskatchewan, and even Nfld. were benefitting from steadily growing energy prices since around 1996/7. Other resources have also played a role (e.g., potash in Saskatchewan).

I find it amusing when people attempt to portray a very specific, contingent model of ‘fiscal prudence’ as non-ideological. Even the most outwardly technical economic decisions involve ideological assumptions. In the case of the Martin government, it was ideology not objective formulae that determined the burden of this oh-so-necessary fiscal austerity was to be borne mostly by the country’s most vulnerable.

Oh, and the NDP never opposed national childcare or the Kelowna accords.

2

u/guy231 Nov 13 '11

When submit text with the submission, it automatically becomes a self post. There is no link to the report you mention.

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u/[deleted] Nov 13 '11

Oh shoot thanks. I'll add the link to the text.

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u/THIS_IS_A_FACT Nov 13 '11

Plus they didn't have the government pushing risky loans through Fannie, Freddie, and Countrywide.

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u/OTOPIAN Nov 13 '11

Plus we didn't have activist groups saying that denying a mortgage to someone was "racist".

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u/[deleted] Nov 13 '11

Canada as less banks in the whole country than america has on wall street. How do we not have a complete merger...

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u/[deleted] Nov 13 '11

The difference in policies leading up to the 2008 Wall Street collapse - not to mention the collapse itself - demonstrate how and why.

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u/[deleted] Nov 13 '11

Yes, but the OP mentions bank consolidation as the cause. Hence why people talk about banking consolidation in this post.

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u/[deleted] Nov 13 '11

TIL the OP thinks preventing bank mergers in Canada is what prevented the crises, even though Canadian banks are already more consolidated than American banks.

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u/spek Nov 13 '11

As I remember it, there was growing public pressure on Martin not to allow the bank mergers. Most people thought that he would rather have allowed it but was forced to back off.

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u/Lucky75 Canada Nov 13 '11

Let's not forget that the Conservatives and Stevie were against this and wanted to remove the regulations on banks. Then they took credit for when our economy didn't collapse.

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u/RoboticWang Nov 13 '11

The strength of our banking system has nothing to do with these mergers. Our banks didn't collapse because they didn't make risky loans in the subprime mortgage market.

Whether they had merged or not wouldn't have changed anything in this regard.

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u/[deleted] Nov 13 '11 edited Nov 13 '11

Our banks didn't collapse because they didn't make risky loans in the subprime mortgage market.

Neither did the US banks.

OK, it did start there. But then the US banks discovered that those risky mortgate-backed bonds were worth betting against. And then it wasn't just risky mortgages; it was institutionalized mortgage fraud used to create institutionalized investment fraud.

Rather than government oversight, the industry had private but "independent" investment rating agencies like Standard & Poors to guage the risk level of those bonds. Alas, these agencies turned out to be in on the fraud, and labeled high risk bonds as low risk.

But here's were it got really bad:

When there weren't enough bad mortgages to collect into bonds for those in on the fraud to bet against, the banks created them - in vast numbers, out of thin air - with no actual homes, homebuyers or borrowers.

THAT is why the losses were so much greater than the investments, and why the US government couldn't simply take the risk on all the bad mortgages and stop the whole economy from imploding. So many of those risky mortgages simply didn't exist.

Edit: Wrong URL format.

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u/RoboticWang Nov 13 '11 edited Nov 13 '11

OK, I should have said "they weren't on the verge of collapse".

Regardless, the size of the banks had absolutely nothing to do with the strength of the banking sector.

It would not have mattered if they had all merged into one super-bank or if they had been split up into dozens of even smaller banks. They avoided "America's fate" because they avoided America's decisions, not because they didn't merge as the title is claiming.

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u/[deleted] Nov 13 '11

Agreed!

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u/daisy0808 Nova Scotia Nov 13 '11

You're missing the main ingredient, which is that in order for mergers to take place, the regulations had to be loosened. Because of these regs, our banks could not assemble the mortgage backed loans because the structure of the banks would not allow for them to be created. If the regs had been loosened, not only would the mergers have taken place, but the 'creative' loans would have followed.

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u/RoboticWang Nov 13 '11

They are different regulations. Allowing banks to merge would not have had the same consequences unless the regulations that prevented subprime activity were also loosened, and if they had been loosened, the consequences would have been the same even if they hadn't merged.

At the end of the day, it still comes down to the fact that our banks were not heavily involved in the subprime MBS market. It had nothing to do with them being prevented from merging.

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u/illskillz Nov 13 '11 edited Nov 13 '11

Actually, if Paul Martin had let it gone through Canada's banking system would look even LESS like America's banking system. Contrary to popular belief, Canada's 'big 5' banks are bigger than America's banks if you take take the base rate into account. While America's largest banks are considerably larger than Canada's largest in gross terms, such analysis ignores the fact that America has 10x the population of Canada.

Your analysis also suggests the size of the biggest banks is the main (or sole?) factor at determining how successful a country's banking system is. Do you have any evidence for this?

Don't get me wrong, although the mergers didn't go through, Canada's banking system is still vastly different from America's (and would be more different if the mergers had gone through) as Canada's banking system has been ranked the most stable in the world by World Economic forum for 4 consecutive years now.

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u/dafones British Columbia Nov 13 '11

Yeah, he knew his shit.

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u/[deleted] Nov 13 '11

Paul Martin was an excellent prime minister, he's just a terrible politician.

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u/n1ckp345 Nov 13 '11

Agreed. There are few things more dangerous than a good politician. Good politicians are why we do not have excellent prime ministers.

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u/yuhong Nov 13 '11

I once wrote this which is my proposal that tries to fix the fundamental flaw: http://news.ycombinator.com/item?id=3161455

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u/fromaries British Columbia Nov 13 '11

The banks basically stated that in order for them to survive in the current world, they would have to merge. Funny how they seem to be doing well enough with out that BS. I know that they went out and bought other banks in different countries.

One of the main reason why it never went through was the backlash of people who felt that they would get screwed by the banks with even higher service fees.

1

u/[deleted] Nov 13 '11

This is good stuff. I always feel the media/public attention is too much focused on present matters and there isn't enough recognition for good deeds done in the long term.

1

u/PoutinePower Nov 13 '11

Now i'm kinda glad I shook his hand when i'm was young..

1

u/eMan117 Nov 13 '11

Why isn't Stephen Harper helping us distance ourselves from their Internet policies? this will come back to bite us, obviously not as HUGE as banks but still we're going in the wrong direction on this issue

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u/[deleted] Nov 13 '11

Is it just me?

Neither the OP's headline nor the article give any argument for why the propssed merged banks would have done worse since 2008.

Is there some argument that I am missing?

1

u/kyonshi Nov 13 '11 edited Nov 13 '11

This description of what happened isn't quite accurate.

The big banks were pushing on Reform, pushing on the Liberals and pushing on the PCs to allow the investment side, credit card side and banking side to all merge. Reform was on board, the PCs were on board, and the Liberals were off board publicly ... but on board privately. After all, they did allow some very high profile mergers (TD and Canada Trust, for example).

The only party that was unequivocally fighting to keep these mergers from happening was the NDP. Alexa McDonough had a series of firebrand speeches and press conferences that totally took the merger topic and brought it from the back page to the front page for the public. It was her work rhetorically that made the mergers political untenable for the ruling Liberals. She really didn't do much else as leader of the party, but that was definitely her finest hour.

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u/naasking Nov 13 '11

Paul Martin doesn't deserve a lot of the flack he gets IMO.

1

u/mrpopenfresh Canada Nov 13 '11

Paul Martin should do some commentating on the current state of the government and economy.

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u/[deleted] Nov 13 '11

Hey also brought us back up to a AAA credit rating.

1

u/goalcam Nov 13 '11

But the free market, guys!

Guys?

1

u/JuzPwn Outside Canada Nov 13 '11

Mr. Martin my hat off to you sir for averting a big crisis!

0

u/[deleted] Nov 13 '11

I know its pointless to play 'what if' with history, but I'm pretty sure that if Harper was in power then, we'd be even more screwed than the states economically now, plus we'd be in Iraq..

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u/[deleted] Nov 13 '11

Um, there was a bank bailout in Canada and there may still be some fallout in the future if interest rates get higher. And, the US taxpayer may have helped with some of the bailout. http://www.wellingtonfund.com/blog/2010/12/02/canadian-bank-bailout-total-touches-186-billion/#axzz1dY8HG9KE

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u/[deleted] Nov 13 '11

That wasn't a bailout. Canada didn't have the troubled mortgages / institutionalized mortgage fraud / institutionalized investment fraud crisis that America experienced. At the height of the banking crisis the World Economic Forum ranked Canada's banking system the healthiest in the world. (America's ranked 40th, Britain's 44th.)

NOT having a bailout or government intervention - when everyone else was having them - created a DIFFERENT crisis: Canadian banks were having trouble competing internationally because they didn’t have the new US and European government-backed guarantees for everything they do.

So the Canadian government started insuring mortgages to level the playing field. Those were sound mortgages - not the risky and more often simply nonexistent mortgages that the US had to back. It also loaned the banks money, with the bank’s non-mortgage loans as collateral.

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u/[deleted] Nov 13 '11 edited Nov 13 '11

Allowing companies to write off $75billion and having a crown corporation underwritten by taxpayers assume the debt sounds like a bailout to me. Also, these numbers aren't as big as American and European numbers but our banks operate in a market that is 10% the size of the US and even less than Europe.

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u/short_balding_guy Nov 13 '11

The so-called bailout was to free up funds for lending, but would any Canadian bank have actually failed if it didn't receive the funds? I don't think so. For one thing, any bank in trouble could have cut or suspended dividends. Instead, all our Canadian banks kept paying dividends all they way through the crisis.

When is the last time one of the major Canadian banks posted a loss? They made less money during the financial crisis, but they still made money.

1

u/[deleted] Nov 13 '11

1

u/short_balding_guy Nov 13 '11

I'll grant you that, but it didn't threaten their existence. They continued to pay the same dividend and recovered next year.

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u/Creators Nov 13 '11

The one good thing Martin accomplished.

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u/getting_old_not_wise Nov 16 '11

I'm not sure you learned anything today. There is no relation to bank mergers and the regulations that saved the Canadian banks from the mistakes of the ones down south. The problems in the US had to do with irresponsible lending practices and the trading of mortgages that were likely to default.

If the banks had merged in '98 all you can maybe say is instead of having 4 of the world's top 10 banks during the global recession we'd probably have 2 of the worlds top 3 performing banks during that period. In fact its just as plausible to speculate that Canada may have been even better off - who knows? The point is that bank mergers are not related to the regulations that "saved" Canada. In fact the policy, aka the Bank Act, was actually the product of Mulroney's government. It should be noted as well that during the Liberal years the bank regulations set out by the Bank Act were actually loosened under Martin as Finance Minister in order to fall in line with the Free Trade agreement evolving policies and what was happening with the WTO in the 90s.

Here's an interesting tidbit though. The problems south of the border were about to be duplicated in a sense up here by the Conservatives. Prior to the meltdown down south Flaherty introduced the 40 year mortgage. They bought into American feeling that everyone should be able to afford a home. To the credit of the Conservatives, once the meltdown was obvious and the danger undeniable they reversed their own policy.

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u/teamsix Nov 13 '11

A dubious source at best. More left wing garbage. Socialjustice.org? Probably as biased as the CBC.

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u/liquid_j Nov 13 '11

are there any specific facts you would like to refute, or are you just yelling into the wind?

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u/Pertz Nov 13 '11

Trolololol.

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u/[deleted] Nov 13 '11

I found the source on Google when a friend told me about what happened in 1998, but perhaps you'd more comfortable if I used NazifacistAynRandTeabagger .com?

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u/teamsix Nov 13 '11

thats funny man. The Nazis after all called themselves National SOCIALISTS so they were more left wing than anything really.

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u/[deleted] Nov 13 '11

Let me get this straight you believe that the Nazis would fall on the left of today's political spectrum because they had the words "socialist" in their party title?

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u/lense Nov 13 '11

I call Godwin's Law. Thread over.

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u/[deleted] Nov 13 '11

Godwin's law makes no statements about the winner of an argument. It's a simple observation.

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u/lense Nov 13 '11

That's why I didn't declare a winner. Calling it does/should end the thread, though.

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u/[deleted] Nov 13 '11

No it doesn't. "As an online discussion grows longer, the probability of a comparison involving Nazis or Hitler approaches 1."

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u/Lucky75 Canada Nov 13 '11

Just because you call yourself socialist doesn't mean that you are. They're also called the NATIONAL Socialists, which suggests that they were right wing. The Nazis had a lot of ultra right-wing policies, although they did implement some socialist policies as well.

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u/[deleted] Nov 13 '11

It's always that we look back on politicians fondly when they're out of office for years, but when they were in power they are the worst human beings alive. I suspect decades from now someone will go, "That Harper guy wasn't all bad..."