Wearing Two Hats Gives Me a Headache

We have a new Premier in British Columbia, Christy Clark. One of her first acts as Premier was to shred my labour budget for the year. I run a retreat centre in rural BC and we’d already set our budget when she announced an increase in the minimum wage. In a three stage process over one year the minimum wage will rise from $8/hr (the lowest in the country) to $10.25/hr.. It rose to $8.75 immediately. On November the 1st it will rise to $9.50 and on May 1, 2012 it will complete its rise to $10.25 (the highest is $11/hr in Nunavut). We hire many young people for the busy summer season and this announcement shredded that budget while giving us a year’s notice that more is to come.

I have been a union supporter all my life and my children have worked for the minimum wage for many years in different parts of the country. So, the social justice part of me cheered at this announcement. At the same time the business manager in me groaned at this sudden 10% increase in my labour budget. This battle between the two parts of my brain has kept me awake more nights than I care to admit.

It reminded of Ontario farmers I know who belong to unions in the auto plants in which they work, and who also support the idea that labour laws for farm labour should be different than labour laws for industrial labour. They are living a contradiction based on power. In the auto plants there are many workers and only a handful of employers. If the workers don’t band together the employers will take advantage of their disunity and cut wages and benefits.

In the agricultural sector, farmers grow larger and larger for less and less return. With this kind of pressure, farmers want to control their costs as much as possible and so panic at the idea that the price of hired labour might increase at the same rate as fertilizer or farm fuel. What is hard to see is how this focus on unionized farm labour is a distraction from the real issues.

What is real is the lack of power individual farmers have in the bargaining for the products of their farms. There are many farmers and only a handful of grain buyers or meat packers. It is agribusiness that protects its profit margin and captures the gains in productivity while farmers continue to struggle. They would be better off organizing to lower the costs of industrial farm inputs than heaping scorn on organized labour. The real target of farm labour organizing is migrant workers from Mexico and Jamaica who harvest fruit, grapes and tobacco on farms in BC and Ontario. God bless these workers who want what we take for granted like universal health care, education and pensions.

As an employer, next year I will still be paying minimum wage but the students I hire will be earning 28% more. I will probably spend less on capital improvements but it won’t make the difference between success and failure. As a person and a citizen I am pleased that the government is forcing me to do the right thing for my employees.

Wearing Two Hats Gives Me a Headache
Another Moral Economy Column
By Christopher Lind
May 26, 2011

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• This column is published in The Western Producer, Canada's largest agricultural newspaper

Can an Economy Ever be Moral?

Another Moral Economy Column
By Christopher Lind
February 2011

If I said Big Business can never be moral, would you agree with me? Why is that? In general, people are pretty cynical about commercial relationships. The bigger the business, the more cynical people are. With size, all relationships become more impersonal. You don’t know the owner and they don’t know you, your family or your community. “Buyer beware” is the dominant motto and you better be very careful if you want to protect yourself against the predatory practices of … (shall we make a list?) … oil companies, used car salesmen, cell phone companies, banks etc.

When I ask people what can be done to make the economy more moral, they typically respond with ideas for personal reform. Banks should have Codes of Ethics so employees are forced to be honest. Oil companies should have training programs for their executives so employees don’t lie, and so on.

These are good responses as far as they go, but that isn’t far. You see, I actually think big business can be moral but all of us are caught up in social systems that are far larger and more influential than our personal relationships. Strong personal ethics are necessary for a moral economy but they are not sufficient. A moral economy also requires a social ethic. What goes into a social ethic? There are many principles but one of them would be mercy.

Bankruptcy is an example of the principle of mercy applied to modern economies. Bankruptcy is a declaration that the commercial enterprise is broken and cannot be fixed. So, the principle of mercy is applied. The remaining assets are divided among the creditors according to certain criteria and the enterprise is over. The parties are now free to restart this or another enterprise. This principle of mercy applies both to personal bankruptcy and to corporate bankruptcy.

Sometimes bankruptcy is thought to contradict the principle of responsibility. We all agree that in general, people who borrow money should pay it back, whether they are individual homeowners or big corporations. In practice though, the larger the corporation the more likely it is to be rescued by governments. This is especially so if the corporation is so interconnected to other corporations that its failure threatens the whole lot.

In the United States pressure is building to address the contradiction as virtually bankrupt companies like the insurance giant AIG, and formerly bankrupt corporations like GM, pay out million dollar executive bonuses while homeowners continue to be foreclosed, because banks refuse to renegotiate mortgages. In this case mercy is being applied to investors and responsibility forced on homeowners. Some people argue that the contradiction should be resolved by forcing the same punishment on investors as on homeowners. I take the opposite view. Mercy is a powerful principle and should be available to investors and homeowners, farmers and students alike. It is a reflection of one of the oldest and widely supported moral rules known to humanity – the Golden Rule. Do unto others, as you would have them do unto you.

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• This column is published in The Western Producer, Canada's largest agricultural newspaper

Knowledge For All

Another Moral Economy Column
By Christopher Lind
October 2010

Yeah, yeah, yeah, the world is going to hell in a handbasket. So what can we do about it? This is one of the most challenging questions I hear. On the one hand the questioner agrees with me that things are deeply wrong. On the other hand they see the engine of destruction frozen in place and no mechanic in sight. What is to be done?

My own approach is two fold. On the one hand I focus on the moral values or ethical principles that have stood the test of time and have shown themselves to be reliable guides in stormy weather.

On the other hand I focus on the new possibilities that globalizing technology and new ways of thinking are making available. Take Wikipedia for instance. Wikipedia was only started in 2001 and as of January 2010 it was attracting 78 million visitors monthly to a site created by 91,000 voluntary contributors.

So Wikipedia is not only an online encyclopedia, it is also representative of a new way of solving problems, of forming community and of sharing knowledge. It is a mechanism for harnessing the power of the crowd.

One of the ways an unregulated market economy works is it allows for capital to find or develop monopoly situations which can be exploited until something breaks. One of those little situations involves the publishing of highly specialized but very important scientific journals. An example might be Nature, the most cited scientific journal. This year the University of California threatened to boycott the Journal because proposed subscription charges were going to increase 400%. In spite of the argument by Nature Publishing Group that they were simply trying to eliminate a historical discount benefiting UC and few others, the news resonated deeply with university librarians who had seen journal subscriptions increase in price faster than any other segment of their budget, often after journals were taken over by larger for-profit corporations.

A Canadian librarian from UPEI, Mark Leggott, is leading the rebellion. In his case the last straw was a science database subscription, Web of Science, which was increasing its price by 120%. His response, and the response of UPEI, was to cancel the subscription and then to organize an alternative based on the power of the crowd. The response is called “Knowledge for All” and it is being supported by the Council of Atlantic University Libraries. Knowledge for All is not a small project. The dream is to index all the world’s scholarly journals, which means something between 4 and 5 million separate articles annually, using an approach that could be called community driven, crowd sourcing or open source, or following a wikipedia model. It will save a lot of money too.

Librarians in PEI and elsewhere are saying the system is broken. However, instead of throwing up their hands, they are teaching themselves how to become their own mechanic. Relying on the shared frustration and shared ingenuity of the group, just like the farmers of yesteryear, they are proposing to build a brand new kind of co-op. It will be light on centralized administration and heavy on group participation. It directs the new globalizing technology to the service of the community and aims at Knowledge for All. How cool is that?

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Canada Post in Parliamentary Rummage Sale

Another Moral Economy Column
By Christopher Lind
10 June 2010

Rural Canadians are resilient, multi-talented people. However, they also depend on a few key institutions to support their diverse way of life. One of those institutions is the Post Office. Fortunately Canada Post recognizes their unique role. This is how the Crown Corporation describes its self-understanding on its website:

“For longer than Canada has been a country, Canada Post has been part of the bedrock of rural Canada. Today we remain the only company that serves all Canadians, in their communities, and this is not going to change.”

The last year was a difficult one for Canada Post. Its volume of mail dropped 8% in 2009 and this decline wiped out 5 years of steady growth. Even though net income increased, the Crown Corporation was unable to issue a dividend to the Government of Canada because of the challenging financial conditions.

Canada Post has a mandate to provide postal service to all Canadians. The reason it can carry out this mandate without a massive subsidy is because it can use the profit from more profitable routes to subsidize the less profitable ones. As you might imagine, the Canadian Government faces constant pressure to allow competition on those more profitable routes. It is only the pressure and vigilance from 843,000 rural Canadian households, the ones who most stand to lose from the decline of Canada Post, that keeps the cross subsidy intact.

This makes the initiative of the current federal government all the more puzzling. It has introduced an omnibus bill, C 9, to remove an exclusive privilege from Canada Post to deliver mail to addresses outside Canada. Now Bill C 9 does other things too. In fact, this single Parliamentary Bill amends over 80 separate pieces of legislation. It changes the rules for Credit Unions, it changes the rules for pensions, it even changes the agreement on social security between Canada and Poland. Possible the shortest amendment in the whole Act is the one paragraph that removes international mail delivery from the hands of Canada Post.

Why would the Government want to do this? Maybe because they have tried it twice before and failed – once before the election in 2008 and again when Parliament was prorogued in 2009. This time they have buried it so deep in other unrelated amendments it looks like they are hiding it. Omnibus bills are best used for fine tuning and technical adjustments of legislation. They are poor choices for substantive changes in policy.

What is at stake here is the question of solidarity of urban Canadians with rural Canadians. It is also a matter of fairness and whether rural Canadians can get access to the same level of service from the government as other citizens. It is also a matter of economic development. If Canada Post has to cut back on rural accessibility in order to cut costs, it will make it more difficult for new businesses to start up in, or relocate to rural areas.

This amendment, buried in bin 15 of the rummage sale known as Bill C9, may seem small but its implications are huge. If you care about your rural postal service, call your MP and ask that this fundamental policy change be given its own bill and its own dedicated debate.


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This column is published in the Western Producer, Canada's largest farm newspaper. For other moral economy blogs see christopherlind.blogspot.com

Do Good and Do No Harm

Another Moral Economy Column
By Christopher Lind
April 8, 2010

In the 13th century, Thomas Aquinas summed up our ethical imperatives with the phrase “Do good and do no harm”. This was not original to him. He was affirming what he learned from early Greek philosophers. The medical profession makes the same claim, which it learned from Hippocrates over 2,000 years ago. This simple formulation expresses a very powerful and complex moral command.

For example, humanity is hungry for energy. Even as we fret about the consequences of releasing so many greenhouse gases into the atmosphere from burning oil and gas, we also frantically search for new ways of expanding our dwindling supply. One of the dramatic new developments in the energy field has been the re-evaluation of our supply of natural gas stored in shale rock formations. The largest formation of this type in North America is the Marcellus Shale, which lies underneath New York, Pennsylvania, Maryland, West Virginia and Ohio. It also extends underneath Lake Erie and into southern Ontario between Port Stanley and St. Thomas. In 2002 it was estimated that this shale formation contained 1.9 trillion cubic feet (TCF) of recoverable natural gas. Only 7 years later that estimate was increased over 100 times to 262 TCF. (The largest shale gas field in Canada is the Horn River basin in northeastern British Columbia with an estimated 25-50 TCF of recoverable gas.)

The difference in the estimates has to do with new techniques of recovery. Through a process called hydraulic fracturing, small explosions are created underground by pumping in fluids to create pressure. These explosions create fractures that release the gas and allow it to be extracted. The fluids are mostly water and so many people are concerned about competing uses of water. Similar concerns about water use are raised with the Bakken shale formation in Saskatchewan and Manitoba and even the Tar Sands in Alberta. In an arid climate, who gets first use?

The fracturing can also change the flow of underground water aquifers creating risks for nearby communities. A small amount of the fluid (0.49%) is made up of a variety of chemicals like ethylene glycol (used in antifreeze) and petroleum distillates (used in makeup remover). It used to contain diesel oil, which contains benzene (a carcinogen). In densely populated eastern North America these concerns have caused intensive environmental reviews.

To be concerned about energy production in an energy hungry world is a morally good thing. However, there are two major ethical concerns that need to be addressed. Firstly, it makes a moral difference if we are working to feed someone who is malnourished or if we are feeding someone who is a glutton. No one can argue that North Americans are malnourished when it comes to energy. We are the biggest energy pigs on the planet.

Secondly, when we work to accomplish something good, we need to make sure we are not also causing harm. It would be unethical to increase our energy supply at the cost of polluting our water supply.

Some decisions do require a moral balancing of goods. We might be willing to divert water from golf course irrigation to energy production but we would probably be unwilling to divert it from food production. Food is essential but my favourite six iron maybe not so much.

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Visit the website at christopherlind.ca
Visit the YouTube channel at Moral Economy column on YouTube

This column is published in the Western Producer, Canada's largest farm newspaper. For other moral economy blogs see christopherlind.blogspot.com