Harper uses new math to kill the CWB

I’ve come to the disturbing conclusion that Canadians in general and the Conservative Party of Canada in particular can’t count. Here are some examples:

-Between 2006 and May 2011 Stephen Harper and his Conservatives led two minority Parliaments, and yet they tried to run this country as if they had a majority of the seats in the House of Commons, proroguing Parliament whenever the Opposition got uppity.

-On May 2, 2011, 39 per cent of voters in Canada cast a ballot for the Conservative Party of Canada, and yet they control 54 per cent of the seats.

-The Conservatives plan to build more prisons and just rolled out their omnibus crime bill, which has been touted as a response to increased crime, despite the fact that Statistics Canada says that all crime, including violent crime, is at a its lowest rate in almost 40 years.

Most recently Gerry Ritz and his moustache have stated that the Conservatives will move forward with their plan to end the Canadian Wheat Board’s (CWB) monopoly, despite 62 per cent of wheat farmers and 51 per cent of barley farmers voting to keep the “single-desk” system.

On Sept. 19, Opposition MPs asked the “Harper Government” to consider the will of the farmers before dissolving the CWB, but Harper and Ritz stood behind their claim that the plebiscite was non-binding and their argument that, since Conservative MPs were elected in almost every rural riding in the West, they have a “mandate” from farmers.

Frankly I find this logic to be pig-headed. Do the election results also mean the Conservatives have no say in the affairs of Quebec or Newfoundland — which are dominated by NDP and Liberal ridings, respectively? No, of course not. These provinces will be as impacted by the polices of Harper’s Conservatives as Alberta.

In all of the posturing by Harper and Ritz, arguing about what metric should be used to determine what farmers want, it seems like the importance of the CWB, which has provided a valuable service to Canadian farmers since its inception in 1935, has been ignored.

Put simply, the CWB supports Western Canada’s grain farmers. They do this by marketing their wheat, barley and durum — 80 per cent of which is sold outside of Canada; transporting the grain to market; providing farmers with “initial payments” to cover their costs between when the grain is dropped off at an elevator and sold; pool farmers’ crops to spread risk across a large number of individuals; research all aspects of grain production and use this knowledge to increase the crop’s value.

To do all of this the CWB employs hundreds of people around the world, 430 in Winnipeg alone, and claims that, in Manitoba, 3,000 jobs have been created as a direct result of their existence.

Furthermore, outside of its operating costs, the CWB does not keep any revenues from the sale of farmers’ grain. In 2010 this meant more than $5 billion was returned to prairie farmers according to the CWB.

Critics will still say, though, that farmers should have the right to market their wheat as they see fit, and that if the CWB does its job well, farmers will continue to support it in a competitive market. This, however, ignores what a competitive market does to the price of goods, which is decrease them.

The CWB argues that one of the most severe consequences in an environment where several companies are marketing Canadian wheat will be that sellers could be forced to undercut each others’ prices, reducing the return to farmers. This return could be impacted to an even greater degree if for-profit companies step in to market grain, which would no doubt take a cut above and beyond the operating costs currently retained by the CWB.

Why are these benefits of the CWB and drawbacks to its demise not entering the debate over the future of this Canadian institution? Why are Harper and Ritz so content to stand behind their “mandate” and dismiss MPs for being too “urban” instead of engaging in a productive debate?

It’s because they are wrong, and they know it, and acting like politicians instead of dictators would expose the shallow neo-conservative motives behind their “ideals.”

Sixty one per cent of voters didn’t cast a ballot for the Conservative Party of Canada and 62 percent of wheat farmers want the CWB to stay intact, which according to Harper’s sums means he can do anything he damn well pleases.

To read Spencer Fernando’s take on the CWB’s monopoly follow this link

8 Comments on "Harper uses new math to kill the CWB"

  1. I am really disappointed when I read these kind of comments made by people that do not understand what they are writing about. Without going into detail, what you say the CWB does is just plain wrong. (The Initial Payment does not even come close to covering costs.

    The CWB competes in the global market already – it’s a price taker and does not command premiums. It says it earns premiums – about 6.00/tonne last year. But what it doesn’t tell you is that it’s marketing costs were about 10.40/tonne, for a net loss.

    Once we get the single desk out of the way, competition will drive costs out of the system, which are relatively high right now.

    Your idea that if for-profit companies market wheat instead of the CWB that the costs will go up is ridiculous. Right now, farmers pay the CWB’s costs PLUS the grain handlers – the for-profit companies – earn their handling margins. Once the CWB single desk is gone, they won’t have the added costs of the CWB.

    Harper and Ritz understand all this because they don’t listen to the CWB’s self serving spin. They look at facts. I suggest you do the same.

  2. Harry Siemens | September 29, 2011 at 10:07 am |

    Hello – Further to John De Pape’s comments, this is a bout marketing freedom and property rights. In fact 35 per cent of wheat farmers voted in favour of cwb.. the rest stayed home. and 29 per cent of barley growers
    The long arms of the CWB are throwing talking points at every person who can’t think on their own. Yes, the conservative government will govern in all regions and will make laws, change laws, add laws as they see fit. Live with it. Canada is fortunate to have Harper and the conservatives compared to country destroyer King Obama

  3. So by your logic, we should count the opinion of people who choose to not vote in elections?

    Sixty five per cent of wheat farmers voted to keep the CWB; that’s a majority in the book of anyone who has completed grade three math. To ignore the will of that majority is un democratic.

    Not that I would expect the first Prime Minister in Canadian history to be held in contempt of Parliament to understand the word “democracy.”

  4. What facts are Harper and Ritz looking at? If they had any facts to back up their claims, you would have thought they would have showed them to the rest of us. But they haven’t, all they have offered up is buzz words and talking points.

  5. mr depape, farmers pay between 7 and 9 cents per bushel on wheat. maybe you should go into more detail, because you don’t sound very informed. do you work for the anti-cwb task force?

    and to mr. siemens says, you are a scary tea bagger and many people wish you’d stop spewing your back woods hate barf wherever they’ll print or post it.

    and jayson, dont hold your breath for depape and seimens or ritz and harper to provide any facts. that’s not the way corporatists roll.

    “It is not truth that matters, but victory.”- hitler

  6. I think farmers should have the right to market/give their grain to whoever they choose.. Nuff said..

  7. John De Pape | October 22, 2011 at 3:56 am |

    Jilderberg: the 7-9 cents you talk about is just the “administration” cost of the CWB. There’s so much more to the cost of the CWB system – the CWB itself reports it’s “marketing costs” (which include the admin costs) to be over $10 / tonne on wheat and over $30 / tonne on durum. Check for yourself at http://www.quorumcorp.net/reports.html

    This is above the fat elevations that the elevator companies charge.

    You want details, go to http://www.cwbmonitor.blogspot.com

  8. Economist Jim | October 26, 2011 at 3:55 pm |

    CWM is not a monopoly. It is a monopsony. Your credibility falls.

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