Farmers for economic freedom
Updates from the Canadian Farm Enterprise Network, Canadian Farmers for Justice and the Prairie Centre. Several of the items appearing here originally appeared in an email list operated by Dwayne Leslie at http://www.prairielinks.com.
web posted October 25, 1999
The Making of a Horror Story
By Craig Docksteader
When the bureaucrats from Environment Canada insist farmers and ranchers have nothing to fear from the upcoming Canadian Endangered Species Protection Act, I don't believe them. I'm not saying they're lying, I just think they're wrong. The course that the federal government has charted for its endangered species agenda spells trouble for landowners.
Based on what we know about the government's proposed legislation, consider the answers to the following questions:
1. Will regulations to protect endangered species apply to private property as well as crown land? Answer: Yes
2. Does this mean the federal government could regulate the use of your land because an endangered species lives on it? Answer: Yes.
3. Could the federal government regulate the use of your land if an endangered species lives on an enjoining property? Answer: Yes
4. Could this regulation of your land result in a loss of income by restricting activity on the land? Answer: Yes.
5. Could this regulation of your land result in a loss of potential future income by limiting your ability to develop the land? Answer: Yes.
6. Could this regulation of your land affect it's resale value? Answer: Yes
7. Would you be paid compensation for personal losses in either income or land value due to the impact of endangered species legislation on your property? Answer: No.
If no-one had ever been down this road before, we might have reason to give the government the benefit of the doubt. But the experience of U.S. landowners under very similar legislation only heightens the concerns of prairie farmers and ranchers.
The story of Mr. John Taylor, from Mason Neck, Virginia, is a typical experience. Taylor, an 80-year-old retired builder, wants to build a modular home on his small, residential lot for him and his disabled wife. Unfortunately, because a bald eagle nest is located on an adjacent lot approximately 43 feet from his property line, the U.S. Fish and Wildlife Service requires him to get what's called an incidental take permit a permit that allows activity that might disturb the habitat of an endangered species.
In his application for the permit Taylor promised not to build during the bald eagle nesting season. Wildlife Service wasn't satisfied. Taylor would also have to pay for and build two bald eagle nesting platforms and an educational exhibit on bald eagle ecology, or contribute to a salmon restoration program. In addition, he must agree to a deed restriction that precludes any disruptive activity, including parties, lawn mowing and children playing on the lot, between the months of November and July the eagle's nesting period.
Until Taylor agrees to these things, Fish and Wildlife has suspended processing his application for a permit. Instead, they have suggested that Mr. Taylor could avoid the permit application process altogether if he simply sold the property to a civic association, or donated it to a conservation organization. When Taylor refused to do either, Fish and Wildlife Service notified him that, in addition to the previous conditions, he may also be required to establish a contingency fund and to post a bond which would be forfeited if the eagles abandoned the nest site -- even though they may leave for reasons beyond his control.
The good news for Mr. Taylor is that at least the U.S. constitution provides some protection for his property rights. This gives him legal recourse to pursue compensation for economic losses resulting from government regulations on his land -- which he is doing. The bad news for Canadian property owners is that there is no such protection north of the 49th.
If Environment Minister David Anderson proceeds on his current plan of action, and pushes through his proposed legislation, we won't have to look south of the border for horror stories. We'll have plenty of our own.
web posted October 18, 1999
In His Own Words: What Kroeger Wrote to Minister Collonette
By Craig Docksteader
Arthur Kroegers recent letter to Transport Minister Collonette on the implementation of the Estey Report has been widely reviewed with the accompanying criticism or praise. But aside from the oft-repeated policy positions, Kroeger also made a number of interesting comments to Minister Collonette which provide some insight into how Kroeger arrived at his conclusions.
In his own words, heres some of what Kroeger wrote to Collonette:
* On the Challenge...
"In the search for common ground, a range of alternatives was examined that went well beyond what would have been permissible on a strict reading of our terms of reference. Nevertheless, the historic divisions among Western stakeholders in the grain handling and transportation system proved too wide to be bridged. The problem of reaching consensus was exacerbated by a degree of fear and mistrust on the part of each stakeholder group vis a vis the others that exceeded anything I have encountered elsewhere in the private sector."
* On the Framework...
"In developing my advice about the points at issue, I was guided by a succession of decisions about grain handling and transportation that have been made by governments since the early 1980s..."
"The general import of these measures is that, for nearly two decades, governments have progressively moved away from regulation and central controls towards providing substantially greater scope for normal commercial decision-making. I am not aware of any recent decision that would indicate an intention to reverse course and return to a more regulated approach. On the contrary, in your statement on behalf of the government on May 12, 1999, you endorsed Justice Esteys call for measures to move further towards a more commercial, contract-based system in which there would be more competition, clearer accountabilities, and greater scope for market forces to influence decision making."
* On the Revenue Cap...
"While there are obvious attractions to reducing the transportation costs borne by producers, such a step should not be regarded as a 'quick' fix. Lower freight rates can alleviate, but cannot solve the income problems currently faced by grain producers. In approaching the question of what would be an appropriate reduction in the initial level of railway revenues, it is useful to bear in mind Justice Esteys observation that, the efficiency and economic health of the rail system is of prime importance, ranking next in importance to the economic well-being of farmers. The railway and the farmers cannot do without each other. Mutual survival dictates that efficiencies and economies must be shared between the two."
"Notwithstanding alarmist predictions from some quarters that there would be major rate increases if the rate cap were removed... in each of the three [ proposed options], costs to producers would go down; the only point in question is by how much. During the Steering Committees review... no member disputed this assessment."
* On Railway Competition...
"The stakeholders report states that the existence of effective competition is a fundamental pre-requisite to the operation of a de-regulated system... I agree."
* On Open Running Rights...
"Among the various possible outcomes of imposing running rights, two are particularly unattractive. One is that the proposed plan would fail to yield the enhanced competition forecast by its proponents... The other alternative, equally unattractive, is that the running rights plan would have the severely adverse effects on the railways that they say it will, in which case the system at the end of five years would be worse than it is now."
A complete copy of Kroegers letter to Minister Collonette is available on Transport Canadas web site at: http://www.tc.gc.ca/railpolicy/default_e.htm.
web posted October 11, 1999
Kroeger Insists CWB's Role Must Change
By Craig Docksteader
Arthur Kroeger's recent report on implementing the Estey Report has added fuel to the debate over the Canadian Wheat Board's role in grain transportation and handling. In his report, Kroeger took pains to reiterate why change is necessary, and why preserving the CWB's current role does not serve that purpose. In part, here's what Kroeger wrote in his September 29th letter to Transportation Minister David Collonette:
"Among producers, recent surveys have found an approximately even division of opinion [on the CWB's role]. The Wheat Board for its part insists that a major role in all elements of the grain transportation and handling system is an essential adjunct to its marketing responsibilities. On the other hand, most of the grain companies, together with the two railways, are of the view that the present system is unnecessarily complex, that accountabilities are blurred, and that important efficiencies could be gained if the Board were limited to receiving grain at port to fulfill its sales contracts."
"The Board's objections that the safeguards in [the proposed model] are inadequate to meet its needs as a marketer have as their premise that contractual commitments cannot be relied upon. Yet a system of contracts, with attendant penalties and rewards tied to performance, is the common currency of the commercial world, and should also be applicable to grain handling and transportation. Grain companies in many parts of the world manage to function effectively without controlling a transportation system, and it should not be beyond the ability of Canadian stakeholders to devise contractual arrangements that would work well in this country."
"While the Board has some legitimate concerns about changing over to new arrangements, it must also be recognized that the present administered system with the Board at its center has not prevented serious problems from arising. Justice Estey described these problems as follows:
"At present there is insufficient discipline in the contractual arrangements between the ship owner/grain buyer and the vendor (the Board and the grain company) who is responsible for the arrival time of the train at the port terminal elevator. Mismatches and delays occur, and demurrage charges are imposed where ships are forced to wait for the right grain. The same delays tie up loaded rail cars, necessitating, on some occasions, their removal from the congested harbour area.'
"Under a contractual system, when a party fails to perform, financial penalties are normally levied against that party. Under the present administered system of grain handling and transportation, accountabilities are so blurred that it is often impossible to ascertain who was at fault, with the results that the costs of the failure end up being charged to the Wheat Board's pool account which is to say that the costs are born by the producers on whose behalf the pool account is maintained.
"In 1993-94 and 1996-97 there were major system failures. The Wheat Board's own estimate is that bad system performance in the latter case cost producers $65 million, and there is substantial evidence that the problems encountered were not solely the fault of the railways or the weather. For example, in June 1996 CPR notified the Board that it had over 600 loaded cars which were not being accepted by terminals for unloading...
"When Ministers held their landmark meeting with Western stakeholders in July 1997, there was a clear consensus that major change was required if the Canadian grain handling and transportation system was to be internationally competitive. It was this consensus that gave rise to the Estey Review, and the subsequent implementation process for which I was given responsibility.
"On the assumption that the government remains intent on effecting major change, therefore, I [recommend a minimal role for the CWB in transportation and handling]."
web posted October 4, 1999
Another Board Game
By Craig Docksteader
In this game, you are a prairie farmer and your wheat is in the bin. In order to survive this long, you have not only beat the weather, the weeds, the long days, the short nights, your banker's nagging, and equipment breakdowns, but you managed to convince your bulk fuel dealer to extend your credit so you could get your crop off.
Now your objective is to turn your wheat into cash and pay your bills so you can play the game again next year. You'll want to get the best return possible by maximizing your sale price and minimizing your costs to get the wheat to market.
However, to make the game more challenging, the designers have incorporated two important rules:
1. You have no control over your costs. You must pay each cost incurred as your grain travels through the system and must go all the way around the game board. Shortcuts are not permitted.
2. You have no control over the sale price of your wheat. Somebody will sell your wheat for you and will neither ask you to approve the sale terms, nor tell you the sale price. Unlike you, this person has nothing at stake in this transaction. Designers of this game insist that you must simply trust them to act in your best interests.
Playing the game:
A. Move your wheat from the farm gate to country elevator. Pay fuel bill, truck repairs, depreciation, municipal taxes, elevation, storage, dockage, unionized elevator employees, and elevator management.
B. The elevator does not receive enough rail cars in this week's allocation. Miss a turn while your grain sits idle. Pay more storage.
C. Rail cars arrive and elevator employees can now load your grain. Pay unionized elevator employees, unionized rail employees, elevator management, railway management, rail regulatory agency bureaucrats and miscellaneous other unionized government employees. Don't forget their benefits, sick pay and pension plan contributions or they might go on strike.
D. Your wheat was not loaded in a block of rail cars and must go through the sorting process in a clogged-up rail yard. Although very inefficient, this happens routinely and you must pay. Miss your next turn.
E. Your wheat is unloaded from rail cars to terminal elevator. Pay elevation, storage, unionized terminal workers, and management, including benefits, sick pay and pension plan contributions.
F. Grain handlers go on strike. You make the mistake of asking why you never get to be at the negotiating table even though you pay them. Miss a turn. Pay storage. Pay negotiating fees. Pay demurrage for loading delays.
G. Negotiators resolve strike and vessel loading begins. Everybody is happy with their decision about how much you will now pay them.
H. Pay grain vessel loaders, International Longshore and Warehouse Union, Grain Shippers' Clearance Association, pilotage fees, tugboat charges, Canadian Grain Commission weighers and inspectors, Port Wardens, and Ag Canada vessel inspectors.
I. Shipping vessel cannot be completely loaded at one berth and must move to another terminal. You pay extra berthing costs.
J. Vessel loading is complete and vessel heads for home. Pay Canadian Wheat Board employees, CWB marketing costs, administrative expenses and CWB Director salaries. Don't forget to pay for CWB advertising which tells you what a great game this is.
Congratulations, you have successfully moved your wheat to market! You may now open the envelope to find out how much money is left from the sale of your wheat. On behalf of the designers of this game, thank you for playing another board game!
web posted September 27, 1999
The Little Red Hen
By Craig Docksteader
Many producers are closely following the talks between the Canadian Wheat Board and the Prairie Pasta Producers (PPP). The success or failure of these talks will have a significant bearing on the opportunities available for farmers to add value to their product without penalty.
Currently, a farmer can feed his wheat or barley to pigs, cows, or other livestock. But beyond this, the producer must jump the CWB's hoops, which amount to a sharing of his potential profit with those who will neither participate in the risk, nor be involved in the process of adding value.
For years a story has circulated which illustrates this attitude. The story portrays the experience of one of these entrepreneurial types who, seeing an opportunity, embarked on a value-added venture. She too was prepared to share her profits with all who participated in the cost, risk, and work. But she too encountered those who, though unwilling to participate, still laid claim to the fruit of her labour.
The story goes like this...
Once upon a time there was a Little Red Hen who scratched about and uncovered some grains of wheat. She called her barnyard neighbours and said, "If we work together and plant this wheat we will have some fine bread to eat. Who will help me plant it?"
"Not I," said the cow. "Not I," said the duck. "Not I," said the goose. "Not I," said the pig.
"Then I will," said the Little Red Hen. And she did. The wheat grew tall and ripened. "Who will help me harvest the wheat?" asked the Little Red Hen. "Not I," said the duck. "Out of my classification," said the pig. "I'd lose my seniority," said the cow. "I'd lose my Employment Insurance," said the goose. So the Little Red Hen reaped the wheat herself.
Later, when she made the wheat into flour, she asked for help to make bread. "That's overtime for me," said the cow. "I'm a dropout and never learned how," said the duck. "I'd lose my welfare benefits," said the pig. "If I'm the only one helping, that's discrimination," said the goose.
"Then I will do it myself," said the Little Red Hen. And she did.
The Little Red Hen baked five fine loaves, and then held them up for her neighbours to see. "I want some," said the cow. "I want some," said the pig. "I demand my share," said the goose. "No," said the Little Red Hen. "I will rest for awhile and then eat these five fine loaves myself."
"Excess profits," cried the cow. "Capitalistic leech," screamed the duck. "Company fink," grunted the pig. "I want my rights," yelled the goose, and they all hurriedly painted picket signs and marched around the Little Red Hen singing, "We shall overcome." And they did.
For when that particular farmer came to investigate the commotion, he said, "You must not be greedy, Little Red Hen. Look at the oppressed cow. Look at the disadvantaged duck. Look at the underprivileged pig. Look at the less fortunate goose. You are guilty of making second class citizens of them."
"But... but... I earned the bread," said the Little Red Hen.
"Exactly," said the farmer. "That is the wonderful free enterprise system. Anybody in the barnyard can earn as much as he wants. You should be happy to have this freedom. In other barnyards, you would have to give all five loaves to the farmer. Here, you give four to your suffering neighbours and keep one for yourself."
And they all lived happily ever after, including the Little Red Hen, who smiled and clucked, "I am grateful." But, her neighbours wondered why she never planted wheat again, and why she never made any more bread.
Anderson's Endangered Species Legislation -- Conservation by Intimidation
By Craig Docksteader
David Anderson, the MP for Victoria, B.C. needs to hear from you. Having recently been appointed as the federal Minister of the Environment, Anderson is threatening to implement heavy-handed legislation to protect endangered species.
For those who have been following the evolution of the Liberal's endangered species legislation, the fiasco is almost dizzying. In 1995, Bill C-65 was introduced, which was supposed to provide a framework to protect endangered species, but incorporated a punitive U.S.-style approach. After being criticized by landowners and land-users as too harsh, and by environmentalists as too soft, Christine Stewart, the former Environment Minister, went to work to develop a consensus on the issue.
Meeting after meeting was held to hammer out differences between stakeholders. Backgrounders, updates, progress reports, regional workshops, national workshops, workshop participant kits, 150-page tabulations of workshop proceedings, a consultation forum on the Internet, draft stewardship strategies, agendas, press releases, proposals, counter-proposals, breakout groups, plenary sessions and more, were all aimed at creating workable legislation with a broad base of support.
The incredible thing was, that -- to a significant degree -- the process was working. Traditional enemies were finding common ground and hammering out joint-proposals. The draconian measures laid out in Bill C-65 were being replaced with recommendations which incorporated voluntary stewardship, positive incentives, and compensation. Farmers and ranchers across the prairies were beginning to sigh with relief that perhaps this time the federal government wasn't just going to ram the legislation through.
Now David Anderson seems intent on changing all that.
Anderson is proposing a law which applies to federal, provincial and private land, and is aimed at protecting both endangered species and their habitat. Wildlife officials will be able to restrict access to any area where an endangered species naturally occurs, or formerly occurred and has the potential to be reintroduced. Even if no endangered species lives there, the enviro-cops can still cordon off the area just in case the species shows up.
To make matters worse, the new Environment Minister doesn't think compensation is necessary. If you end up losing money because your land has been taken out of production -- too bad. In fact, if you dare to step over the line, he's quite happy to slap you with criminal charges.
Anderson appears to be living in a political bubble. His constituency in Victoria probably has more urban tree-huggers per capita than any other electoral riding in the country -- they'll think he's a hero.
To satisfy the other critics he can whip out public opinion polls that seem to say more than 90 percent of Canadians support endangered species legislation. He can wave a letter signed by 631 Canadian scientists which insists that the federal government needs to go further in its efforts to protect endangered species. He can even trot out a petition signed by some 80,000 Canadians indicating their support for the implementation of endangered species legislation on a national level. In his mind, the move towards conservation by intimidation is justified.
If the law passes, it could take years to publicly and politically demonstrate that this kind of approach not only endangers landowners and landusers, but the very wildlife it was supposed to protect. Even then it will take a tremendous effort to get the legislation back on the political agenda in order to fix it.
The only thing that might still save the day is a wake up call from the grassroots. Minister Anderson needs to hear from you. His number in Ottawa is 613-996-2358. His fax number is 613-952-1458. His email is Anderson.D@parl.gc.ca. You can phone him, fax him, or email him. You won't get to talk to him, but he'll get the message.
Craig Docksteader is Coordinator with the Prairie Centre/Centre for Prairie Agriculture, Inc. "Where Do We Go From Here" is a feature service of the Prairie Centre.
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