Inkless Wells

 Inkless Wells

Paul Wells on all the latest out of Ottawa—along with the occasional post about jazz. Follow Paul on Twitter: @InklessPW
He also offers his thoughtful perspective of Stephen Harper’s last 10 years in his recent eBook, The Harper Decade.

Categories: Capital Read, Inkless Wells

Question, answer: Jack Layton

by Paul Wells on Wednesday, September 16, 2009 4:37pm - 101 Comments

Inkless makes a too-rare visit to the scrums after Question Period and poses this question to Jack Layton.

Question: when you borrowed to finance your campaign, only a year ago, your collateral was your anticipated per-vote public subsidy. How can that be your collateral for another campaign — because the Prime Minister has said he will abolish the per-vote public subsidy?

The Hon. Jack Layton: I’m not sure about this, but we may be the only political party to own a building in downtown Ottawa that has a very good tenant, in fact more than one in it.

Question: That wasn’t your only collateral a year ago.

The Hon. Jack Layton: You’ll, you’ll have to talk to — well there’s actually many sources of collateral. There’s the percentage that comes back as a percentage of the campaign expenditures automatically, there’s all kinds, it’s a fairly complicated set of revenues that make up the revenue of a political party. What I’m very happy about is the surge of financial support that’s come in just in the last five days to our party. And I think Canadians like the fact that we’re standing up and fighting for the unemployed and not chomping at the bit to try and fight an election. And so, we’ll, we’ll keep on this path and try to get those results.

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  • Mulletaur

    The NDP is a rentier, the lowest form of capitalist parasite ! You've got to be kidding me.

    • http://transview.wordpress.com/ stu

      prove it

      • Mulletaur

        "The Hon. Jack Layton: I’m not sure about this, but we may be the only political party to own a building in downtown Ottawa that has a very good tenant, in fact more than one in it."

        Reading comprehension problems, much ?

    • http://intensedebate.com/people/hellomike hellomike

      Bahaha.

  • http://intensedebate.com/people/SeanStok SeanStok

    They're landowners?!!!!! That seems wrong, somehow.

    (p.s.: nicely done, Paul)

    • http://intensedebate.com/people/Jack_Mitchell Jack Mitchell

      It strikes me that would actually be a good way to run a political party: the Real Estate Mogul that fights for the little man.

      • http://intensedebate.com/people/SeanStok SeanStok

        There's already a folk song to go with it:

        Dear landlord,
        Please heed these words that I speak.
        I know youve suffered much,
        But in this you are not so unique.
        All of us, at times, we might work too hard
        To have it too fast and too much,
        And anyone can fill his life up
        With things he can see but he just cannot touch

        (Dylan, for those who aren't familiar)

    • herringchoker

      Actually its fairly standard practice for political parties. You buy a building or two which you can mortgage when an election comes along in order to have a lot of cash. If memory seves Jack and company bought their first property after receiving their first payout under JC's election financing law. Clearly someone in the party has some experience at this type of thing (no doubt someone from the prairies). As for Jack? Well his experience with real estate is well known to the folks in Toronto.

  • http://intensedebate.com/people/SeanStok SeanStok

    "There’s the percentage that comes back as a percentage of the campaign expenditures automatically…"

    Translation: Go buy some more beer. We're short on cash and we can use the deposit money from the empties when we're done drinking it.

    • RayK

      Layton is referring to the fact that Elections Canada rebates 50% of all campaign expenditures to parties in addition to the $1.95 per vote subsidy and donation tax credits.

      • http://intensedebate.com/people/SeanStok SeanStok

        So, as I was making fun of, they're going to spend money to finance themselves?

        • RayK

          Parties get back a percentage of everything they spend during a campaign (I think it's 50%) in the form of a rebate from Elections Canada. So, yes, "there’s the percentage that comes back as a percentage of the campaign expenditures automatically".

          If you $18 million, then you get back $9 million. If you only spend $10 million, then you only get a rebate for $5 million. So, in a very real way, "spending money" DURING THE ELECTION PERIOD AS OPPOSE TO OUTSIDE THE ELECTION does help finance a party based on how our (Canada's) rebate system works.

          • http://intensedebate.com/people/SeanStok SeanStok

            OK, I get your point now. But you have to admit it's still a bit funny sounding as a financial plan. :)

  • BobsYourUncle

    Shoppers Drug Mart moved out of the NDP building this monday. They are without tenant, and by my calculations, their brilliant commercial real estate strategy has turned into a giant white elephant.

    • http://intensedebate.com/people/BCerInToronto Jeff Jedras

      That's what I've heard as well.

      Is there a new anchor tenant? Or do they maybe just not keep the leader up to date on their real estate strategy?

      • http://www.intensedebate.com/people/avr avr

        It's not a particularly new or attractive retail space, either. Shoppers' had to do some significant renovations the year before last, just to bring it up to their chain standard, and it was still kind of grubby and cramped at that.

        Maybe they can entice the secondhand childrens' shop next door to move in…

        • Dot

          Hey, that must be the big beautiful store that they were bragging about in their earlier press release. They were trying to rent it to the Liberals.

    • RayK

      This is incorrect. The NDP has a long-term lease for that space that runs until 2016.

      "BTW – the New Democrats are welcoming a new store to its downtown HQ, where the long term lease which runs until 2016 will be introducing a new operation."

      http://www2.macleans.ca/2009/09/16/protest-much/

    • http://intensedebate.com/people/VinceClortho VinceClortho

      Not saying this would happen but what if the the CAW suddenly decided to rent space to store….say oxygen, nitrogen and some other assorted gases….and they paid the highest level of rent in the city, in fact prepaid their rent and signed a contract taht said this was non refundable if they decided to move their poxygen somewhere else.

      Would that be a campaign donation or would that just be the normal income generation of NDP Inc?

      • RayK

        Any payment to a party is considered a contributions if the payment exceeds the fair market value of any goods or services that the payer receives in exchange for the payment. The amount of the contribution is the amount of the payment less the of any goods or services that the contributor received.

        There can, of course, be debates about what constitutes fair market value, but ultimately–in such a case–it would be up to Elections Canada and the courts to decide if a given case constituted a breach of the Elections Act.

    • Dr_Funk

      The Shoppers' Drug Mart is being replaced by a Murale outlet, one of Shoppers' new upscale boutiques.

  • http://intensedebate.com/people/Gaunilon Gaunilon

    Good grief.

    Good questions Wells.

  • http://intensedebate.com/people/Dennis_F Dennis_F

    Current and primary NDP objective: To convince everyone that they're not a 100 lb weakling as a result of this latest and utter flip-flop.

    • http://intensedebate.com/people/Jack_Mitchell Jack Mitchell

      A flip-flop which is propping up the party you support. Ah, gratitude.

    • http://www.intensedebate.com/people/Jack_Mitchell Jack Mitchell

      A flip-flop which is propping up the party you support. Ah, gratitude, thy name is CPC.

      • http://intensedebate.com/people/avr avr

        You're right. Making the NDP look more weak and foolish than usual was the icing on the cake, and we should be more grateful they folded so easily.

        • http://intensedebate.com/people/Jack_Mitchell Jack Mitchell

          Yup.

      • http://secondthots.blogspot.com Dennis

        a) I don't "support" any party.

        b) What in the world does your comment have to do with mine?

        Geez. Next.

        • http://intensedebate.com/people/Jack_Mitchell Jack Mitchell

          My mistake, I thought you were a card-carrying Conservative. Apologies.

  • http://nottawa.blogspot.com mark

    "There’s the percentage that comes back as a percentage of the campaign expenditures automatically…"

    That's money owing to the individual candidates. Is he going to take it all? He can't without their permission.

    Funny how earlier in the day they were preaching local empowerment when it came to their appointment of candidates. I guess you could call it turning sacrifical lambs into cash cows.

    • RayK

      Goodness gracious there's so much mis-information in this post and in the comments.

      In addition to riding rebates federal parties get direct rebates on their spending as well–I believe it's 50% for parties and 60% for ridings.

  • Mulletaur

    Oops.

    • http://intensedebate.com/people/Ed_Sweeney Ed_Sweeney

      Oops indeed. Was that just a fabrication?

      • Mulletaur

        Nope, it was just on Newsworld and it's on the Toronto Star Web site.

        • http://intensedebate.com/people/Ed_Sweeney Ed_Sweeney

          Yeah, I checked out the Star, then had a shower to clean up. So why the delete?

  • http://intensedebate.com/people/Jack_Mitchell Jack Mitchell

    You're on something of a germane allusion roll today, eh?

    • http://intensedebate.com/people/SeanStok SeanStok

      I can't help it, sometimes.

      • http://intensedebate.com/people/Jack_Mitchell Jack Mitchell

        "It ain't easy bein' apropos"

  • MJ Patchouli

    I'm curious to know why the delete too! It's over at thestar.com.

    Admin? Why was the verbatim news report censored, please?

    • http://intensedebate.com/people/Inkless Inkless

      I asked for that. I wanted to make sure the news report was authentic and in any case, it's not germane to this thread.

      • MJ Patchouli

        Yes, well I did say Whoa, sorry to switch gears, or something like. Also never noticed before that we had to be GERMANE to the article on here, but thanks for letting me know why it disappeared.

        You wouldn't want Macleans.ca to become known as a news site that censors its commenters for questionable reasons, would you?

        And it is very interesting news, well worth an interruption of the regularly scheduled rants. Will you be posting anything about how the cons are going to battle this pr nightmare — maybe make an example of him (if proven guilty, of course) for their get tough on crime platform?

        • Anon

          Yeah, I definitely wouldn't want to be Jaffer appearing in front of Justice Harpe…what? He's not a judge? The PMO isn't reponsible for individual sentences? This story really has no political angle other than the fact that it's kind of embarassing when a former MP and cabinet minister's husband is found in possession of blow?

          Huh. Who knew.

      • bruce

        So was it the Jaffer thing that was censored? Just curious, not wanting to start a long off-topic discussion or anything.

        • http://intensedebate.com/people/Inkless Inkless

          Arrrrgh. Yes.

          • http://intensedebate.com/people/madeyoulook madeyoulook

            You see what happens when you censor something, folks? Just makes the silly thing more likely to arouse interest…

            Kidding! I kid! Macleans and Rogers can do whatever it likes with its property. Probably in them terms of service I might get around to reading one day.

  • Smith

    Jack is such a fool. Maybe he’s getting ready to run against David Miller. As a land lord he’s sure to get the capitalist vote.

  • MJ Patchouli

    I just flagged my own immediately previous comment and asked the administrator why it's deleted. It seems to me the bloggers here, and most of us commenters, regularly link to other news sources. I don't like being censored on something so benign.

  • http://intensedebate.com/people/Lord_Bob Lord Bob

    See, this is why I could never be a politician.

    If I was caught flatfooted with a question I didn't know the answer to, I'd hem and haw and probably make something up. I wouldn't launch into how the lease agreements in the building we own are totally nails for working-class Canadians etc. etc. as if I thought that was totally germane and precisely what inexperienced Parliamentary journalist, renowned non-cynic, and uncritical swallower of party bologna Paul Wells wanted to hear.

    Jack, there's nothing wrong with not knowing every detail of your party's finances off the top of your head. Just admit it and move on. Don't try to save face with insane, half-senile rambling.

    (Reposting a comment that was deleted automatically because, er, let's just say I accidentally used the name of Penn and Teller's television show.)

  • http://intensedebate.com/people/macphear macphear

    Folks THIS is what twitter is for :)

  • Harvey

    What bank do they use? I wonder what the Banks position on securing loans with voter subsidies that the government wants to elimate is?

    • RayK

      According to the book Well's cites it was Citizens' Bank which is owned by a credit union.

      • http://intensedebate.com/people/madeyoulook madeyoulook

        And really, for the NDP, would you expect it to be anything else but a credit union?

  • http://intensedebate.com/people/Jack_Mitchell Jack Mitchell

    This is rather O/T, but why do we have to have 3- or 4-week campaigns? Couldn't we just have a 10-day campaign? That might make Canadians less averse to them, save everybody money (or we could raise the spending caps during the campaign), and frankly get the voters to pay more attention to politics when it's not in (official) campaign mode.

    Also, I'd like to see ways of creating an iron-clad online voting apparatus. May not happen now, may not happen tomorrow, but the days of everyone not having easy access to the Internet will soon be gone. Elections Canada should keep exploring it.

    • http://intensedebate.com/people/ottawasteph ottawasteph

      39 days

    • http://www.intensedebate.com/people/ottawasteph ottawasteph

      1. 39 days
      2. Online voting would help Canadians who have disabilities.

      • http://intensedebate.com/people/Jack_Mitchell Jack Mitchell

        Seriously, 39 days last time? That's insane. It's just an orgy of cant.

        Good point about disabled Canadians. I guess the argument against online voting, apart from security (which is serious, of course), is that not everybody could figure it out and not everybody has an Internet connection. But to my mind those non-security arguments apply, mutatis mutandis, to the paper ballot situation too: not everybody knows where to go on election day, and not everybody knows what they do when they get there. Also, as I said above, the number of people who aren't part of the online world is rapidly diminishing. Anyway, I guess we'll see it before too long, one way or another.

        • Mulletaur

          I would like to see six month campaigns where each party leader is required to take trains and buses from one end of the country to another and meet as many Canadians as possible. That will result in two things : a real fixed date election law with no escape clause, and much better transportation links. Wells might even get that high speed train we've all been dreaming of.

    • http://intensedebate.com/people/madeyoulook madeyoulook

      Election experts will happily correct me, but is there not a time frame for candidates to secure the nomination in each riding? Since not only the big parties feel compelled to put a candidate in every riding, even obvious loser ridings, don't we think all those loser independents deserve a chance to get on the ballot, too?

  • http://intensedebate.com/people/macphear macphear

    The building was purchased by unions and given to the NDP before the new party funding rules came in place.

    • Mulletaur

      You mean UNION DUES were used to pay for this TREACHERY OF THE WORKING CLASS !!!

      Preytell, which unions and when ?!

  • RayK

    Perhaps you are just not aware of all the details of election financing, but there are three sources of public funding to political parties: the $1.95 per vote subsidy, donation tax credits and election rebates (a 50% rebate for party spending and a 60% rebate for riding-level spending, if memory serves). The book to which you link is clearly referring to rebates, not the per-vote subsidy, as ridings don’t get a per-vote subsidy.

    The Conservatives have said they will abolish the per-vote subsidy—the one source of public funding they rely on less than other parties—not election spending rebates.

    Both your post and your question are based on an utterly baseless premise.

    • http://intensedebate.com/people/Ed_Sweeney Ed_Sweeney

      Ray,
      the post is about the questions put to Layton and his answers, which speak for themselves. The link is just a backgrounder on how the NDP finances its campaigns, it is definitely relevant, and interesting reading.

      • RayK

        The questions are based on a false premise. The link is not a backgrounder at all, but rather it is supposed to provide the factual basis for the premise of Wells questions. That premise is on a factual claim–that "when [the NDP] borrowed to finance [its] campaign, only a year ago, [their] collateral was [their] anticipated per-vote public subsidy"–that is contradicted by Wells source.

        Furthermore, once you understand the difference between the per-vote subsidy and election rebates, Layton's answer makes perfect sense: he was saying that in addition to the per-vote subsidy parties receive direct rebates from Elections Canada and that is what the NDP uses as collateral. That claim is backed by Wells own source.

        • http://intensedebate.com/people/Ed_Sweeney Ed_Sweeney

          Ray, how is it contradicted? You say the source is not mentioning per-vote subsidy, but it does. It says that part of the collateral used, albeit for 2006, was the per-vote subsidy: "the local riding rebate from the state, operational if 10 percent of the vote is received, was estimated to provide an additional $2 million". Due to the election expense rebate, that $2 million really translates into $3 million out of a total of $10 million. How would the NDP make up that kind of shortfall, assuming they have already been maximizing their efforts to bring in donations? Its an extremely relevant question.

        • http://www.intensedebate.com/people/Ed_Sweeney Ed_Sweeney

          Ray, how is it contradicted? You say the source is not mentioning per-vote subsidy, but it does. It says that part of the collateral used, albeit for 2006, was the per-vote subsidy: "the local riding rebate from the state, operational if 10 percent of the vote is received, was estimated to provide an additional $2 million" (p.102). Due to the election expense rebate, that $2 million really translates into $3 million out of a total of $10 million. How would the NDP make up that kind of shortfall, assuming they have already been maximizing their efforts to bring in donations? Its an extremely relevant question.

  • http://intensedebate.com/people/Ed_Sweeney Ed_Sweeney

    I bet the audio on that interview would be interesting. So the NDP want to risk their (presumably only) blue-chip asset in order to participate in an election whose outcome will almost certainly diminish their presence and their future outlook. They want to get the sound-financial-stewardship card off the table earlier, I suppose.

  • http://www.intensedebate.com/people/Ed_Sweeney Ed_Sweeney

    I bet the audio on that interview would be interesting. So the NDP want to risk their (presumably only) blue-chip asset in order to participate in an election whose outcome will almost certainly diminish their presence and their future outlook. They want to get the sound-financial-stewardship card off the table early, I suppose.

    • http://intensedebate.com/people/madeyoulook madeyoulook

      Is Ed suggesting that card was still in the deck?

      • http://intensedebate.com/people/Ed_Sweeney Ed_Sweeney

        pardon me.

  • http://intensedebate.com/people/robert_mccl6309 Robert McClelland

    Inkless makes a too-rare visit to the scrums after Question Period and poses this question to Jack Layton.

    Good try, Paul. From what I know about how organizations operate Jack probably wasn't the right guy to ask though. Anne McGrath would likely have an answer for you.

    • http://intensedebate.com/people/VinceClortho VinceClortho

      Not necessarily true. Depends on the party leader….Dion would have had no clue….Iggy would say Mr Jones handles that, Harper would know the date the contract was signed…Layton strikes me as more a Harper hands on party machinery guy.

    • http://intensedebate.com/people/Ed_Sweeney Ed_Sweeney

      If Jack wasn't the guy to ask, then shouldn't Jack have know that?

  • scf

    I thought the whole idea of collateral was that it had to be stuff that you already own, not potential future revenue.

    • http://intensedebate.com/people/robert_mccl6309 Robert McClelland

      I thought

      If only you would once in a while.

      • scf

        sensitive! go lay an egg.

    • http://intensedebate.com/people/StephenGordon StephenGordon

      No, future revenue can be considered collateral. Think of loans where the recourse in case of non-payment is to garnishee wages in case of default.

    • http://www.intensedebate.com/people/StephenGordon StephenGordon

      No, future revenue can be considered collateral. Think of loans where the recourse in case of non-payment is to garnishee wages.

      • scf

        That's not the kind of risk I'd like – even with a political party.

    • http://intensedebate.com/people/madeyoulook madeyoulook

      Future revenue can indeed be offered up in support of a loan application. It is up to the lender to determine the reliability of that future revenue as it evaluates the credit risk.

      • scf

        lender to determine the reliability of that future revenue

        Interesting – in this case that makes the lender an election predictor.

  • notjacklayton

    parties get 50% of what they spend back from Elections Canada. Candidates also get a subsidy back.

    Eelctions Canada has the annual filing from the ndp released July 1. Would challenge any accountant to review that and say they can afford to spend $20 million on a campaign esp with their revenues thus far this year.

    $4m debt, building worth $4 million, revenue including rent barely paying bills. they would also have to retrofit for their new tenant and that will cost them a few months rent

  • http://intensedebate.com/people/DeliciousLattes DeliciousLattes

    Are you suggesting that Harper would eliminate the per-vote subsidy to an election that had already taken place?

    • http://intensedebate.com/people/Jack_Mitchell Jack Mitchell

      Good point. They're secure for this coming round at the least. Unless . . . well, unless Harper has no shame.

      • http://intensedebate.com/people/madeyoulook madeyoulook

        Harper could CAMPAIGN on "these sick subsidies end at the end of FY 2010-11," or some such, and then the parties (and the enablers who lend to them) could read the polls, estimate the probability of a Conservative majority, and act accordingly.

        Speaking of no shame, wouldn't it be RADICAL if parties chose instead to spend money they already have instead of deficit financing of each campaign? I know, I know, it's crazy talk, but I can't help thinking aloud from time to time.

        • http://intensedebate.com/people/Jack_Mitchell Jack Mitchell

          Ah, right, good point. Hmm. Yes, it would all depend on the likelihood of a Conservative majority. Which I think is not all that lightly, but then again I'm not a bank.

          I agree that it's a bit crazy to borrow the money for every campaign, but that's the NDP for you: nothing but a bunch of entrepreneurs and capitalists.

  • knick

    All of which just goes to show that playing the moral superiority card ad nauseam can come back to bite you. Good to know that Jack Layton persona won't be turning up again any time soon.

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