Fundamentally conversations on trust take place within a framework of social capital and/or social cohesion.

Trust in a habitable, provisional space allows for the unfolding of social events by social actors in everyday life.

When we trust (a social actor) a person, or a thing, does that imply that we think we can predict future performance and/or behaviour based on what we assume we know about them? But how can this exist in a world of constant change? The light bulb burns out, the road is now covered with black ice, the bank suddenly changes its mortgage rate, the co-worker is fearful of losing his job, the company has been bought out, stock values are dropping, the product you always buy has been recalled, the food in your everyday diet has been found to put you at risk, you witness a friend behaving out of character, you experience betrayal.

In whom and what do we, can we and should we trust?

Can we lie to ourselves? Can we trust ourselves?

In narrating our lives, our inner monologue, we try to understand and organize in the present moment that which we we have experienced and thought in the past. In that way potential patterns emerge about what we trust might happen in the future. But when we review these thoughts and events in the light of more recent and legitimate thoughts and interpretations we realize that anticipated patterns are no longer robust. Data sets have changed. New patterns of potential future behaviour emerge. We nurture new habits to integrate these new more beneficial behaviours. By acknowledging the other in one’s life and the limitations of our own understanding of reality, we engage in conversations of conflicting yet enmeshed ideas, interpretations, projects and ultimately, values. As we encounter others whose ethics resonate with ours while introducing something new, better, we can gradually and purposefully adopt and adapt new habits and change ourselves.

Derrida suggested that humans have always had the choice of belief. There is an unending oscillation between absolute abandonment, despair and trust in God. Humans can constantly blaim or rebuke God or take responsibility for the consequences of their own actions.

See Ricoeur and Derrida.

1759 Adam Smith in The Theory of Moral Sentiments:

“How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it. Of this kind is pity or compassion, the emotion which we feel for the misery of others, when we either see it, or are made to conceive it in a very lively manner. That we often derive sorrow from the sorrow of others, is a matter of fact too obvious to require any instances to prove it; for this sentiment, like all the other original passions of human nature, is by no means confined to the virtuous and humane, though they perhaps may feel it with the most exquisite sensibility. The greatest ruffian, the most hardened violator of the laws of society, is not altogether without it.”

Smith writes (6th ed. p. 350):

… In spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose … be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society (Adam Smith in The Theory of Moral Sentiments).

1800 [Entrepreneurship] was shaped by culture and delivered in trust. Trust was at the base of business activity and it was ultimately formed and informed by religo-spiritual beliefs and tradition (Capaldi 2005:339 citing J.B. Say c.1800).

1816-10-28 Hegel argued that he had dedicated his life to science “and it is a true joy to me to find myself again in this place where I may, in a higher measure and more extensive circle, work with others in the interests of the higher sciences, and help to direct your way therein. [I ask that you] bring with you a trust in science and a trust in yourselves.

1916 The term social capital first appeared in the context of academic debates on the decline of American cities and close-knit neighbourhoods (Capaldi 2005:339)

Wittgenstein (On Certainty) remarked on trust and foundational propositions. Primitive or elementary faith is hasty but excusable for without it one would be incapable of learning and engaging in language games. see also http://www.bu.edu/wcp/Papers/Lang/LangOrba.htm http://cp.unitingchurch.org.au/if_it_be_your_will.pdf

Popper in the Logic of Scientific Discovery argued that the critereon for propositions that belong to the empirical sciences is that they are capable of being falsified by evidence.

1962 Joan Robinson (Economic Philosophy 1962:146) claimed that solutions offered by economists to the moral and metaphysical problems are as ‘delusory as those of the theologians they replaced  (Economic Philosophy 1962:146).” She called for an ideology based on more than monetary values (Capaldi 2005:4). In her chapter entitled “Metaphysics, Morals and Science” Robinson (1962) argued that we enjoyed ontological certitude prior to the Freud’s who exposed us to our propensity to rationalization and Marx showing us how our ideas spring from ideologies.

1977 Glenn Loury used the term social capital to describe sources of certain kinds of income disparities (Capaldi 2005:339).

Pierre Bourdieu described it as one of the forms of capital that held account for individual achievement (Capaldi 2005:339).

Chicago sociologist, James Coleman, employed the term social capital throughout his opus of contributions (Capaldi 2005:339).

1985 The World Bank (1985:29) defines social capital as “the norms and social relations embedded in social structures that enable people to coordinate action to achieve desired goals (Capaldi 2005:339 citing J.B. Say c.1800).

Nan Lin published a trilogy on social capital: theory of social structures and action; theory and research; and foundations of social capital. Social capital is entrenched in popular parlance (Capaldi 2005:339).

1993 Hugh Laurie starred as a conman, Leo Hopkins, who charmed then ruined the lives of his elderly parents, wife, family, friends and strangers (and his prison cellmate) out of millions of dollars in Britain’s ITV network drama entitled All or Nothing at All. Even when he warned others of his untrustworthiness, they trusted him with their careers, lives and money.

2000 Trust is grouped along with personal connections and a sense of community as contributing to social capital in thriving organizations (Don Cohen and Laurence Prusak In Good Company (2001). Social capital which involves the social elements that contribute to knowledge sharing, innovation and high productivity upon which business and corporate life depend (Capaldi 2005:339 citing J.B. Say c.1800).

2005 (Capaldi:339) argued for the need for a spiritual capital which is closely connected to on-going debates on trust, corruption, governance, sustainability and entrepreneurship. An investigation of spiritual capital would consider: The role and scope of personal religious ethics on private economic decisions; the exegetical, economic and historical roots and traditions which give rise to contrasting work ethics and economic systems; the role of societal institutions based on faith ranging (companies, trade unions, political parties, NGOs, intermediating structures); interpretations and practices concerning interest, inflation, growth, government authority, charity, trade in various spiritual worldviews; impact of religion on conduct and rules as employees, employers, consumers, producers, citizens (Capaldi 2005:342.

2005 Daniel Yankelovich, co-founder of the Public Agenda Foundation claimed people are developing a new spiritual search because of a lack of trust in business leaders. 87% of the population believes that there is a decline in social morality.
Business & Economics:

Bibliography and webliography

Capaldi, Nicholas. 2005. Business and religion: a clash of civilizations? M & M Scrivener Press.

Abstract: “Since the late 1960s American culture has been involved in a struggle to articulate an effective business ethics. The scandals of Enron and WorldCom constitute egregious examples of the absence or deficiency of ethical decision-making in matters of commerce. The purpose of this volume is to inaugurate a dialogue on the common elements of all three Abrahamic traditions – Christianity, Islam, and Judaism – that touch on ethical issues in business. With scholars, religious and business leaders joining the debate, this anthology is the beginning of a reconstruction of the understanding of the relationship between religion and commerce. Main Features: The following questions are addressed: Is a purely secular business ethics irremediably deficient? Does a substantive business ethic require a religious and spiritual framework? To what extent does current business practice reflect a spiritual dimension? What are the various religious traditions’ perspectives on the ethics of commerce? Can the various religious traditions generate a non-adversarial, consistent, and coherent business ethic? Is there a role for religion and spirituality in a global and post-modern business world?” Nicholas Capaldi is the Distinguished Chair of Business Ethics at Loyola University in New Orleans where he also serves as the Director of the National Institute for Business Ethics.

 

Gambetta, Diego (2000) “Can We Trust Trust?”, in Gambetta, Diego (ed.) Trust: Making and Breaking Cooperative Relations, University of Oxford, 213‐237

A Trust Crisis Paola Sapienza and Luigi Zingales1 http://faculty.chicagobooth.edu/brian.barry/igm/atrustcrisis.pdf

Notes

Paul Ricoeur, wide-ranging thinkers in the twentieth century, a contemporary continental philosopher whose work on existentialism and phenomenology to psychoanalysis, politics, religion and the theory of language have an enduring quality. One of the areas he investigated was the role of Imagination, testimony, and trust which is a chapter in the book by Ricoeur entitled On Paul Ricoeur: the Owl of Minerva by Richard Kearney

 

 

nurturing authentic relationships of mutual respect between self and the other-I.

Stressing your system

December 8, 2007


He was a first generation Canadian and was deeply proud of his Scottish background. Whether saying a prayer, making a presentation or telling one of his many jokes, it all sounded better with his Scottish brogue. When I read letters or emails from him I still hear it. He seemed somehow to embody so much of Herman’s portrayal of his country as described in How the Scots Invented the Modern World: The True Story of How Western Europe’s Poorest Nation Created Our World & Everything in It. We were twenty years younger but we became lifetime friends inspite of physical distance and long lapses in communication. Not long ago we were there beside her hospital bed when his wife died of cancer. He was still involved in the local community and in masters’ athletics.

He worked for many years as mechanical engineer with mining companies in remote and northerly areas. His was the first story of the American-style firing I heard and perhaps for that reason I felt it so deeply. Perhaps it was how and where we learned about it that made it seem so ominous. In the 1980s we were living in a third-world country in a youthful self-imposed minimalist lifestyle that suited the idealism of those who experienced the 1960s. In comparison to where we were living, so much of the Canadian socio-economic, political structures seemed like a mirage, a goal towards which our adopted home could aspire to, perhaps 50 years in the future. When the letter arrived we read it together in disbelief. If he was vulnerable to being fired, to being almost cheated out of a pension, how could others survive? How could this happen in Canada? He talked about a colleague who arrived at work one day and without warning was met at the entrance by Security who accompanied him to his office and observed as he emptied his personal belongings from his desk into a cardboard box. The man left in a daze and was found hours later wandering off along the highway with his box in his hand unable to grasp what had happened to him.

During the 1990s when we were back in Canada, the American-style firing became common practice. Companies learned to use financial incentives to ensure the silence of people they fired. Our Scottish friend eventually landed on his feet, started a successful second career and rarely seemed to reveal any bitterness about the experience. Other friends and family members have not been so fortunate. Were we indeed acquiescing, as Uchitelle (2006 [2007]) suggests and therefore encouraging the counterproductive process of layoffs, mergers and acquisitions and outsourcing, that destroyed the notion of job security and dignity of work in North America?

So as I read synopses, excerpts and reviews from the book entitled The Disposable American: Layoffs and Their Consequences (2006 [2007]) by economist, journalist and professor, Louis Uchitelle, it brought me back to that 1980′s letter, like an old postcard that slipped from between the virtual pages of Uchitelle’s book making this story so intimate, personal and timeless.

Timeline of related social events

1950s and 1960s Economist, journalist and professor, Louis Uchitelle described this period as the heyday in the rise of job security in the United States (Uchitelle 2006; Uchitelle 2007).

1966-1988 Donald W. Davis was CEO of Stanley Works for twenty two years in New Britain, Connecticut, the city’s largest employer. These two decades spanned the city’s largest employer best days to the beginning of the layoffs (which he initiated) and plant closings in the 1980s. Like many chief executives of his era, he had been deeply involved in the life of the city that had supplied thousands of Stanley’s workers. The Davis children attended public school in New Britain where he served on the Board of Education including a stint as president of the Board (Uchitelle 2006; Uchitelle 2007).

1975 Foreign competition made its inroads into the North American economy. Corporations panicked with a knee-jerk reaction by implementing the first major layoffs which eventually spread and multiplied, in time destroying the notion of job security and the dignity of work in North America (Uchitelle 2006; Uchitelle 2007).

1987 Economist, journalist and professor, Louis Uchitelle covered economics for The New York Times since 1987, focusing on labor and business issues.

1988 Donald W. Davis retired on schedule, a wealthy man. He sold his bright yellow Dutch Colonial home in New Britain, Connecticut, and moved with his wife to Martha’s Vineyard, where their summer house on seven acres of rolling lawn became their main residence (Uchitelle 2006; Uchitelle 2007).

1996 Economist and journalist Louis Uchitelle shared a major award for its 1996 series “The Downsizing of America.” He also taught journalism at Columbia University’s School of General Studies.

2006 Former CEO of Stanley Works, 81-year-old Donald W. Davis was running a leadership seminar at the Massachusetts Institute of Technology. This was his final public platform where he could present his explanation of the layoffs and plant closings at Stanley Works in the 1980s. Somewhere between 1988 and 2006 he became too uncomfortable to make the four hour trip between his comfortable home in Martha’s Vineyard to New Britain, Connecticut. His former employees had lost their jobs against their wishes. Although he admits to initiating the layoffs he maintains that no one blames him.

Category

Business & Economics >> Economic Conditions

Keywords, folksonomies:

Business, Economics, Economic Conditions, layoffs, job security, wasteful mergers, mergers and acquisitions, wage stagnation, outsourcing, Business Ethic, labour, labor, downsizing,

Webliography and Bibliography

Herman, Arthur. How the Scots Invented the Modern World: The True Story of How Western Europe’s Poorest Nation Created Our World & Everything in It.

Uchitelle, Louis. 2007. “Le coût psychique du licenciement.” Le Monde diplomatique. Octobre.

Uchitelle, Louis. 2006. The Disposable American: Layoffs and Their Consequences. Random House. 2006-03-28. ISBN: 1400041171

Uchitelle, Louis. 2007. The Disposable American: Layoffs and Their Consequences. Knopf Publishing Group. Apr 2007. http://www.ereadable.com/scripts/browse.asp?ref=5551619605&source=P25

CC Flynn-Burhoe, 2007. Stressing your System. >> Speechless. December 7.

CC Flynn-Burhoe, 2007. Stressing your System. >> Google Docs. December 7.

http://docs.google.com/Doc?id=ddp3qxmz_420g988s8dt


Business Editor Charles Frank (2007) cites a FirstEnergy Capital Corp newsletter to clients comparing Alberta’s provincially-funded analysis “Our Fair Share” chaired by Bill Hunter on royalties, to the modus operandi of socialist governments Kazakhstan and Venezuela. Premier Ed Stelmach commissioned a full analysis of provincial royalties as the price of a barrel of oil soared. It is now c. $82.881 a barrel. (It has to be $50 a barrel to extraction of oil from the oil sands profitable.)

EnCana CEO Randall K. Eresman threatened to redirect a billion dollars of EnCana’s planned capital investment out of Alberta to other parts of Canada or the United States if Premier Stelmach adopt’s the “Our Fair Share” report proposals in their entirety.

2007-10-02 Saskatchewan politicians hope that companies like EnCana will act on their bluff and move at least part of their billion dollar threat out of Alberta and into Saskatchewan if royalties are raised too much. Canadian Association of Petroleum Producers industry vice-president David Pryce adds to the oil companies threats saying that if Alberta opts for their fair share of royalties the oil companies will shift activity to the other jurisdictions like Saskatchewan. However, even though Saskatchewan politicians might hold out for awhile, they would pay at the polls just like Stelmach if they continue to operate their energy sector as if the rules of the 1970s still apply. Alberta has lower corporate taxes, no provincial sales tax and no resource royalty surcharge so how much is Saskatchewan willing to give away to enjoy an Alberta boom? (Wood 2007-10-02). Do they really want the housing crisis, the long delays in service to drive their thriving economy even more? Are they willing to forego their fair share to entice fickle oil companies to their province.

CBC. 2007-10-05 ConocoPhillips President Kevin Meyers threatened Alberta Premier Ed Stelmach that ConocoPhillips will postpone $8 billion proposed oilsands projects. Meyers claimed that if royalties are raised as suggested in Our Fair Share and by the Alberta auditor ConocoPhillips would lose an oilsands project worth $500 million next year. They threaten to cut 30 to 40% of the $2.5 billion to $3 billion it plans to spend in 2008 on Alberta-based activity. It is estimated that if all the recommendations of Our Fair Share were implemented, the Alberta government would benefit by $2 billion a year. Alberta has a history of hospitality for oil and gas companies with the low energy royalties (based on oil at ?20 a barrel versus $80 and rising4), no provincial sales tax, no Alberta has lower corporate taxes, no provincial sales tax and no resource royalty surcharge. Oilsands developers have been allowed to use Alberta’s limited natural gas resources to extract their oil as quickly as possible instead of slower technology-intense methods. (Even the oil industry DOE report urges the need for patient money). Images of the Fort McMurray’s envirnomental nightmare landscape of Fort McMurray are courteously not shown around at dinner tables (although in quieter voices Albertans will ask, “Have you ever been to Fort McMurray?”).

Who’s Who

EnCana 10th place in Fortune Global 500′s Mining, Crude-oil production Industry: EnCana with an overall Fortune 500 rank of 431/500 (previously 396/500) and revenues of $17,081.0 millions. EnCana’s profits are $5,652.0 million; Assets: $35,106.0 Million; Stockholders’ Equity: $17,466.0 million. CEO Randall K. Eresman. It has 4,678 employees and is located at 855 2nd St. S.W., Calgary T2P 2S5, Canada, Phone: 403-645-2000
Website: www.encana.com
FirstEnergy Capital Corp. (started c. 1994) is a member of the Canadian Investor Protection Fund. Its 79 employees including CEO Jim Davidson, Jill Angevine, Vice-President of institutional research, John

Chambers, Ruby Wallis, Bev Thompson, Sheila Kaiser, Margie Gal, and Angelique Cyr work long days beginning at 6:15 AM and engage in the high-pressure industry of investment dealing. These investment dealings and transactions individually involve multi-millions and even billions of dollars of financings2. It is located at 1100, 311 – 6 Avenue SW, Calgary Alberta T2P 3H2 (FirstEnergy Capital (USA) Corp. is a member of the Securities Investor Protection Corporation.) The firm has raised $7 million for Calgary’s less fortunate. It now supports over 200 charities. (Every year, [they] allocate a minimum of 2.5 percent of our gross profits to charitable organizations and community groups. Often, [they] significantly exceed this minimum donation. These actions illustrate the strong sense of community that is part of [their] corporate culture.” For example a party they hosted during the rodeo with 1500 guests raised $200,000 for Calgary Communities Against Sexual Abuse (CCASA), Calgary Quest School and the Parks Foundation Calgary. In June 2006 CalgaryInc named them as the best place to work in Calgary. As well according to their own site “Canadian Business magazine ran a very complimentary article on FirstEnergy in the August 2007 edition covering the firm back to inception and including a mention of our expanded relationship with Société Générale.”

FirstEnergy Capital Corp FirstNews for investors tracks changes in the price of oil, gas through indicators such as unseasonable temperatures (for example in Toronto) or weather disturbances (such as hurricanes), consumer confidence, industry takeovers, bankruptcies, labour disputes, changes in interest rates, the housing market, oil and gas inventories and industry regulation. For example on September 25 they reported that “U.S. stocks fell on Monday, after news that Germany’s largest bank may take a hit from sub-prime mortgage investments. Citigroup and other banks fell after sources said the exposure could reduce Deutsche Bank’s profit by $2.4 billion. Furthermore, the first nation wide strike at General Motors in 37 years raised concerns about the economic outlook. Shares of auto parts suppliers fell, led by a 3% drop in Lear Corp. The Dow Jones Industrial Average lost 61.13 points to end at 13,759.06, while the NASDAQ fell 3.27 points to close at 2,667.95 (FirstNews 2007-09-25).”

Timeline

1992 Kazakhstan adopted among the world’s most open investment laws in order to encourage development.

2002 After the April 2002 aborted coup against Venezuela’s President Hugo Chávez, many observers accused Washington of having been behind the attempted ouster. The Bush administration denied any U.S. involvement in the affair. However, one relatively clear connection emerged between the U.S. government and the anti-Chávez movement: millions of dollars in U.S. taxpayer money channeled through the IRI and other U.S. organizations that funded groups opposed to Chávez during the years preceding the April coup. Writer Mike Ceaser reported that in an April 12, 2002, fax sent to news media, IRI President George A. Folsom rejoiced over Chávez’s removal from power. “The Venezuelan people rose up to defend democracy in their country,” he wrote. “Venezuelans were provoked into action as a result of systematic repression by the government of Hugo Chávez.” With NED funding, IRI had been sponsoring political party-building workshops and other anti-Chávez activities in Venezuela. “IRI evidently began opposing Chávez even before his 1998 election,” wrote Ceaser. “Prior to that year’s congressional and presidential elections, the IRI worked with Venezuelan organizations critical of Chávez to run newspaper ads, TV, and radio spots that several observers characterize as anti-Chávez” (Ceaser 2002). (IRI 2007)

2007-09-25
Rumours circulate that Germany’s largest bank may take a hit from sub-prime mortgage investments (FirstNews 2007-09-25).

2007-09-25 The first nation wide strike at General Motors in 37 years raised concerns about the economic outlook. Shares of auto parts suppliers fell, led by a 3% drop in Lear Corp. (FirstNews 2007-09-25).

2007-09-28 The Global Energy Conference for members only was held in Toronto, Canada on September 28 and announced on FirstEnergy Capital Corp. website.

2007-09-28 “The Kazakh parliament unanimously approved a bill Sept. 26 that would allow the government to modify or break any contract unilaterally in which the “interests of Kazakhstan” are threatened (as defined by the government). They are demanding royalties of 40% up from 30%. Kazakhstan now produces 1.3 million barrels per day (bpd) of oil, and if the projects currently signed are completed, within 10 years it hopes to be producing 3.5 million bpd [. . .] Royal Dutch/Shell, ExxonMobil and ConocoPhillips are part of the oil consortium developing Kazakhstan’s oil. [. . .] The best that Kazakhstan [might end up with a] Venezuela-like situation, in which foreigners freeze all expansion efforts and focus solely on inexpensive methods of maintaining existing output. In Venezuela output has fallen from 3.5 million bpd to 2.3 million bpd since government restrictions began 10 years ago. One of Kazakhstan’sfields is one of the most technically challenging in existence, boasting vertical and variable deposits loaded with high-pressure hydrogen sulfide. The field itself is in a high wind zone that freezes over in the winter. Kashagan will be the most technically challenging — and expensive — oil project ever attempted.” [China has the capital to invest in Kazakhstan but perhaps lacks the technology for now (Offnews.info 2007)."

2007-10-02 Saskatchewan politicians hope that companies like EnCana will act on their bluff and move at least part of their billion dollar threat out of Alberta and into Saskatchewan if royalties are raised too much. Canadian Association of Petroleum Producers industry vice-president David Pryce adds to the oil companies threats saying that if Alberta opts for their fair share of royalties the oil companies will shift activity to the other jurisdictions like Saskatchewan. However, even though Saskatchewan politicians might hold out for awhile, they would pay at the polls just like Stelmach if they continue to operate their energy sector as if the rules of the 1970s still apply. Alberta has lower corporate taxes, no provincial sales tax and no resource royalty surcharge so how much is Saskatchewan willing to give away to enjoy an Alberta boom? (Wood 2007-10-02). Do they really want the housing crisis, the long delays in service to drive their thriving economy even more? Are they willing to forego their fair share to entice fickle oil companies to their province.

CBC. 2007-10-05 ConocoPhillips President Kevin Meyers threatened Alberta Premier Ed Stelmach that ConocoPhillips will postpone $8 billion proposed oilsands projects. Meyers claimed that if royalties are raised as suggested in Our Fair Share and by the Alberta auditor ConocoPhillips would lose an oilsands project worth $500 million next year. They threaten to cut 30 to 40% of the $2.5 billion to $3 billion it plans to spend in 2008 on Alberta-based activity. It is estimated that if all the recommendations of Our Fair Share were implemented, the Alberta government would benefit by $2 billion a year. Alberta has a history of hospitality for oil and gas companies with the low energy royalties (based on oil at ?20 a barrel versus $80 and rising4), no provincial sales tax, no Alberta has lower corporate taxes, no provincial sales tax and no resource royalty surcharge. Oilsands developers have been allowed to use Alberta's limited natural gas resources to extract their oil as quickly as possible instead of slower technology-intense methods. (Even the oil industry DOE report urges the need for patient money). Images of the Fort McMurray's envirnomental nightmare landscape of Fort McMurray are courteously not shown around at dinner tables (although in quieter voices Albertans will ask, "Have you ever been to Fort McMurray?").

Footnotes

1. "Crude oil prices posted big gains on the day. The continued decline of the U.S. dollar and concerns that supply may not be able to meet demand this coming winter, fuelled the price increase. NYMEX light sweet crude for November delivery gained $2.58 to end at $82.88 per barrel [. . .] Canadian stocks continued their five day rally closing higher on strong commodity prices. The government also reported a $13.8 billion budget surplus for fiscal 2006-07, which will be used to pay down debt. Suncor Energy was the biggest weighted gainer, up $2.17 or 2.3% to $95.71. The S&P/TSX Composite Index gained 94.76 points to close at 14,129.73. [. . .] U.S. stocks ended higher on Thursday, as energy shares were elevated by higher oil prices. However, a report released earlier in the day showed a plunge in new home sales and the sharpest year-over-year drop in prices in nearly 37 years. The Dow Jones Industrial Average gained 34.79 points to 13,912.94, while the NASDAQ gained 10.56 points to close at 2,709.59. (FirstNews 2007-09-28).”

2. In an online summary FirstEnergy includes in their recent report on their 800 financings and over 200 M&A assignments that they has participated in since c. 1994.$701,000,000 disposition by EnCana Corporation of its Interest in Petrovera Resources LimitedPartnership in January 2004. Others are: $495,000,000: the Sale of Sound Energy Trust to Advantage Energy Income Fund in September 2007; $3,500,000,000: of CCS Income Trust as Formal Valuator and Advisor to the Independent Committee September 2007; $508,000,000: Sale of Capitol Energy Resources Ltd. to Provident Energy Trust. June 2007; $91,000,000 Compton Petroleum Corporation Acquisition of Stylus Energy Inc.August 2007; $980,000,000 for TriStar Oil & Gas Merger with Real Resources Inc. August 2007; $440,000,000 Sale of Find Energy Ltd. to Shiningbank Energy Income Fund September 2006; $431,000,000 True Energy Trust Acquisition of Prairie Schooner Petroleum Ltd. September 2006; $1,500,000,000 Savanna Energy Services Corp. Merger with Western Lakota Energy Services Inc. August 2006; $320,000,000 Highpine Oil & Gas Limited Acquisition of Kick Energy Corp. August 2006; $4,000,000,000 Viking Energy Royalty Trust Merger with Harvest Energy Trust February 2006; $4,400,000,000 Precision Drilling Corporation Reorganization into an Income Trust November 2005; $350,000,000 UTS Energy Corporation Partnership and Asset Sale to Teck Cominco Limited December 2005; $1,400,000,000 Cequel Energy Inc. and Progress Energy Ltd. Merger and Reorganization into a Trust and Spinout of ProEx Energy Ltd. and Cyries Energy Inc. April 2004.

 

3. 1st place in Fortune Global 500′s Mining, Crude-oil production Industry: Anglo American with an overall Fortune 500 rank of 195/500 and revenues of $33,072.0 million; 2nd place in Fortune Global 500′s Mining, Crude-oil production Industry: BHP Billiton with an overall Fortune 500 rank of 205/500 and revenues:$32,153.0 millions; 3rd place in Fortune Global 500′s Mining, Crude-oil production Industry: Rio Tinto Group with an overall Fortune 500 rank of 313/500 and revenues:$22,465.0 millions; 4th place in Fortune Global 500′s Mining, Crude-oil production Industry: RAG with an overall Fortune 500 rank of 345/500 and revenues:$20,365.0 millions; 5th place in Fortune Global 500′s Mining, Crude-oil production Industry: CVRD with an overall Fortune 500 rank of 359/500 and revenues:$19,651.0 millions; 6th place in Fortune Global 500′s Mining, Crude-oil production Industry: Oil & Natural Gas with an overall Fortune 500 rank of 369/500 and revenues:$19,237.4 millions; 7th place in Fortune Global 500′s Mining, Crude-oil production Industry: Occidental Petroleum with an overall Fortune 500 rank of 377/500 and revenues:$19,029.0 millions; 8th place in Fortune Global 500′s Mining, Crude-oil production Industry: Surgutneftegas with an overall Fortune 500 rank of 392/500 and revenues:$18,413.1 millions; 9th place in Fortune Global 500′s Mining, Crude-oil production Industry: Xstrata with an overall Fortune 500 rank of 414/500 and revenues:$17,632.0 millions; 10th place in Fortune Global 500′s Mining, Crude-oil production Industry: EnCana with an overall Fortune 500 rank of 431/500 and revenues:$17,081.0 millions; 11th place in Fortune Global 500′s Mining, Crude-oil production Industry: China National Offshore Oil with an overall Fortune 500 rank of 469/500 and revenues:$16,038.9 millions.

4. Not to mention Tertzakian’s $100 a barrel peak!


Webliography and Bibliography

2007. “EnCana.” Snapshots. Fortune Global 500. September 30. http://money.cnn.com/magazines/fortune/global500/2007/snapshots/11155.html

CBC. 2007-10-05 “Energy giant rages against plan to hike Alberta royalties.” http://www.cbc.ca/canada/calgary/story/2007/10/05/royalties-protests.html

Ceaser, Mike. 2002. “As Turmoil Deepens in Venezuela, Questions Regarding NED Activities Remain Unanswered,” Americas Program, December 9.

FirstNews. 2007. FirstEnergy Capital Corp. September 28. http://firstenergy.com/research/news/News-2007-09-25.pdf

FirstNews. 2007. FirstEnergy Capital Corp. September 28. http://firstenergy.com/research/news/News-2007-09-28.pdf

Frank, Charles. 2007. “Tough Talk Just the Start to Ugly Royalty Fight.” Calgary Business. Calgary Herald. September 29. C1 & c14.

(IRI) International Republican Institute. 2007. Right Web Profile. Silver City, NM: International Relations Center, July 19.

Offnews.info. 2007. “Kazakhstan – End of an Era.” Offnews.info. Buenos Aires, Argentina. September 30. http://www.offnews.info/verArticulo.php?contenidoID=9429

Wood, James. 2007. “Politicians in no mood to alter Sask. energy royalties system.” The StarPhoenix. Saskatoon.


Creative Commons License 2.5 Flynn-Burhoe, Maureen. 2007. “Fear Industry marries Oil Industry: Albertastan? Canazuela? Who’s Afraid of Social[ism] Capital?” http://docs.google.com/Doc?id=ddp3qxmz_380dvhvz9 September 30. Creative Commons License 2.5 Flynn-Burhoe, Maureen. 2007. “Fear Industry marries Oil Industry: Albertastan? Canazuela? Who’s Afraid of Social[ism] Capital?” >> Speechless. September 30.


How to allocate scarce medical resources is a touchstone question with ethical, economic, social and political dimensions. Debates focus on rationally coherent and justifiable procedures for prioritizing health-care. Norman Daniels (1985) provided a useful non-utilitarian ethical principle for distributing health care resources which he later developed with James Sabin into a theory of “accountability for reasonableness” (A4R) (Daniels and Sabin 2002). University of Toronto Political Science professors David A. Welsh and Melissa Williams, wrote an Op-Ed (2002) for the Globe and Mail in response to the Canadian Romanow report on health care. They described how a just health-care system through the Rawls lens would be one that works to the greatest benefit of the least-advantaged member of society.

 

 

In 2007 the US c. 9 million children still have no health insurance. In 1997 the US government introduced a bipartisan program called S-CHIP broadly supported by both Democrats and Republicans which expanded health coverage to millions of at-risk children from low income families. Private insurance companies like Medicare Advantage, backed by the CATO Institute, are lobbying Senators to minimize the access of vulnerable families to health care by equating these social services based on social justice to a step towards socialism and away from the rights of market freedom (Lieberman 2007).


 

“By every measure, the ten-year-old program–passed during the Clinton Administration as a bipartisan, incremental effort to expand health coverage to millions of poor kids–has been a success. Thanks to S-CHIP, the number of low-income uninsured kids dropped by one-third over the decade, even as the number of uninsured adults went up. Three out of four eligible kids participate, and studies show they receive preventive care and have improved health outcomes and school performance. “It has been the only success story in initiatives to improve healthcare access,” says Cindy Mann, who directs Georgetown University’s Center for Children and Families [. . .] S-CHIP enjoys broad support among Democratic and Republican governors. Its flexibility allows states to tailor their own programs or build on existing Medicaid arrangements to target children typically in families with incomes of up to 200 percent of the federal poverty level[1] (about $41,300 for a family of four this year) [. . .] This summer the House and Senate passed bills reauthorizing S-CHIP, but by mid-September it became clear that the House bill, which added 5 million uninsured kids to the rolls and paid for their coverage partly by cutting government over-payments to Medicare Advantage plans, would lose to the more minimal Senate approach. Giving health insurance to more kids instead of overpaying highly profitable insurance companies seemed like a good trade. But the Senate, lobbied all year by the insurance industry, didn’t see it that way [. . .] Influential GOP senators, targeted by sellers of Medicare Advantage plans heavily marketed in rural areas, are adamantly against cuts to Medicare Advantage [. . .] Nearly 9 million kids now have no health insurance, and up to two-thirds of them are eligible for S-CHIP or Medicaid. Even so, for [. . .] the White House, both bills cover too many children. [. . .] Apparently the Administration prefers to unleash families into the Darwinian jungle of the private insurance market, where only the wealthiest and healthiest can buy a policy. [. . .] The price for family coverage now averages $12,000, or about 20 percent of income for a family of four with income at 300 percent of the poverty level. [There are] new bare-bones policies, such as the one sold in Ohio by Anthem Blue Cross and Blue Shield with deductibles ranging from $4,000 to $20,000 ($8,000 to $40,000 if the family uses out-of-network providers). The policy covers only two doctor visits per year, and families must pay 30 percent of any hospital bill after satisfying the deductible [. . .] The Cato Institute held a briefing called “Sinking S-CHIP: A First Step Toward Stopping the Growth of Government Health Programs.” Heritage and the American Legislative Exchange Council called their briefing “S-CHIP Expansion: Bad for Kids, Families, and Taxpayers.” They are equating health-care for poor kids with socialism. If that’s the case, our children will be the first casualties on the way to marketplace perfection (Lieberman 2007).”

 



University of Toronto Political Science professors David A. Welsh and Melissa Williams, wrote this Op-Ed (2002) for the Globe and Mail in response to the Canadian Romanow report on health care. They described how a just health-care system through the Rawls lens would be one that works to the greatest benefit of the least-advantaged member of society:

 


 

John Rawls, one of the most important political philosophers of the 20th century, died last week near Boston. We both had the pleasure of studying under him in graduate school, where we came to know him not only as a brilliant thinker, but as a kind and gentle man. He will be sorely missed. Last week Roy Romanow released his much-awaited report on the Canadian health-care system. As proponents and critics predictably squared off, we naturally wondered what Mr. Rawls might have to say about it. Quite a lot, we suspect. And his particular take on the matter would have productively re-framed what is becoming a tiresomely clichéd debate. Part of what made him such a decent human being was his unyielding commitment both to liberty and to equality. What made him a brilliant philosopher is that he had far more success than most in reconciling the two. In his greatest work, A Theory of Justice (1971), he argued that if we understand society as a scheme of co-operation for mutual advantage, we can best accommodate the demands of liberty and equality by designing social institutions around two core principles. The first is that every member of society should be entitled to the fullest scheme of personal liberty consistent with a like liberty for all. The second, or “Difference Principle,” is that inequalities in the distribution of primary goods (things it is rational to want no matter what your particular life plan or conception of the good might be — such as wealth) should work to the greatest benefit of the least-advantaged member of society. It is perfectly all right to have rich people and poor people in society, according to Mr. Rawls, as long as the poorest would be even poorer under any alternative set of basic principles of social distribution. Advocates of private health-care provision stress the importance of liberty — of the right to choose how and where to spend one’s health-care dollar. Advocates of universal public health care stress the importance of equality, of every citizen’s right to the same quality of health care at the same speed of delivery. Mr. Rawls would argue that access to health care is a quintessential primary good: No matter what your life plan might be, it’s rational for you to want it. It’s a limited resource in all societies, and all societies must decide how to distribute it. Some choose market mechanisms; others socialize it. As a primary good, he’d argue, it should be governed by the Difference Principle. A just health-care system is one that works to the greatest benefit of the least-advantaged member of society. Which model would we choose if guided by Rawlsian principles? Existing systems in countries comparably wealthy to Canada offer us clues. From the perspective of the least-well-off, largely private systems such as the American one fare poorly in comparison to public systems such as Canada‘s (though they have advantages such as speed of delivery for costly cutting-edge procedures). But this casual comparison is insufficient. It’s possible that some creative blend of public and private health care might serve the worst-off in society better than does Canada‘s current system, even if revamped in the way suggested by the Romanow report. Mr. Rawls would ask us to think imaginatively about alternatives, model them intensively, and choose accordingly. He would have us embrace whatever worked to the benefit of the least-advantaged — perhaps some creative blend of public and private. Without scrutinizing the alternatives from the perspective of the least-well-off, he’d say, we cannot know whether inequalities in access to health care would be just or unjust. That strikes us as a perspective well worth pondering. Melissa Williams and David Welch teach political science at the University of Toronto (Williams and Welch 2002).

 

 

Emanuel ‘s review of Daniels and Sabin’s Setting Limits Fairly – Can We Learn to Share Medical Resources? summarizes the strengths and weaknesses in this widely cited theory of “accountability for reasonableness” (A4R).

“In 1985, Norman Daniels published Just Health Care, which articulated the first useful, nonutilitarian ethical principle for distributing health care resources. Daniels claimed that health care was important because it helped to ensure “normal human functioning,” which in turn enhances people’s opportunities to pursue their life plans. In Daniels’s view, a just health care system tries “to make sure that individuals maintain normal functioning, where possible” — an ethically valuable way to ensure equality of opportunity. Although Daniels’s fair-opportunity principle was an important advance, it became clear that it had problems. First, it appeared to justify the provision of almost all available health care services, since almost everything physicians can do is aimed at maintaining normal functioning and enhancing people’s opportunities. In this sense, it hardly seemed to be a way to set priorities; rather, it seemed to be a way to justify doing nearly everything medically possible. To his credit, Daniels was among the most perceptive critics of his own principle and identified other limitations, such as its inadequacy for helping to determine whether priority should be given to lifesaving interventions for a few patients or to services that improve the quality of life for many. In this new book, Daniels and James E. Sabin offer another approach. They argue that in Western democracies, there is no agreement on substantive principles for the distribution of health care services. Consequently, the challenge is to define the conditions under which it is ethically acceptable for institutions to set limits on health care. They propose four conditions, collectively termed “accountability for reasonableness”: first, publicity (decisions to limit health care and their rationales must be publicly accessible); second, relevance (the rationales invoked must be based on evidence, reasons, and principles that fair-minded persons would affirm); third, appeals (mechanisms for challenging allocation decisions must exist); and fourth, regulation (public procedures must ensure the fulfillment of these three conditions). Daniels and Sabin believe that requiring the use of public, explicit decisions “will improve the quality of decisions making” and will improve public confidence that decisions are made for ethical and not self-interested reasons. Daniels and Sabin devote the second half of their book to studies of how accountability for reasonableness works in the real world. They examine approaches to last-chance therapies, ways in which various managed-care organizations have confronted lung-volume-reduction surgery, and the problems of pharmacy benefit design. One conclusion of Setting Limits Fairly is that, because of limited resources and nonmedical priorities, justice does not entitle people to all effective medical services. Another is that justice does not entitle every person to the same set of medical services. Different health care plans might well come to different determinations, for example, about whether to cover the cost of an artificial heart or the latest migraine medication. Consequently, one person might be entitled to an artificial heart, but his or her neighbor might not be. Yet if the plans’ procedures for determining these distributions fulfill the conditions of accountability for reasonableness, both determinations might be ethical. People are entitled not to the same set of services but, rather, to determinations made through fair procedures. Daniels and Sabin note that agreement on substantive principles for allocating medical resources is unlikely; defining fair procedures for priority setting should be the goal. What is at issue is whether accountability for reasonableness is the right approach. In my opinion, this approach is too passive. Powerful health care institutions make the decisions and provide the reasons, and persons subjected to the decisions merely have the right of appeal. There are, however, avenues for influencing the distribution of resources, such as participation in debates about funding priorities, communication with political representatives, and formation of political associations to lobby and advocate. Fair procedures require the empowerment of those who must live with the medical services that are covered. To augment Daniels and Sabin’s four principles, we need at least three additional principles: first, fair consideration (there must be mechanisms to assess and incorporate every person’s interests and preferences); second, empowerment (there must be mechanisms for persons to influence decision makers and to participate in the decision-making process); and third, impartiality (those formulating and implementing decisions about resource allocation should not have a conflict of interest). In the next decade, every country will face very hard choices about how to allocate scarce medical resources. There is no consensus about what substantive principles should be used to establish priorities for allocations. Instead, we will need fair procedures. Debate will focus on what those procedures should be. Daniels and Sabin’s accountability for reasonableness and illuminating case studies will be invaluable in furthering that debate (Emanuel 2002).”

Schlander expert evidence presented (2007) to the UK House of Commons committee clearly outlines the components of Daniels and Sabin’s concept of Accountability for Reasonableness (A4R).

5.1 Recognizing both the difficulty of democratic societies to achieve consensus on distributive principles for health care and the need for legitimacy of allocation decisions, Norman Daniels and James Sabin (2002) proposed a framework for institutional decision-making, which they call “accountability for reasonableness” (A4R). In order to narrow the scope of controversy, A4R relies on “fair deliberative procedures that yield a range of acceptable answers” and consists of four conditions. 5.1.1 Publicity, ie, resource allocation decisions must be public, including the grounds for making them. Transparency should open decisions and their rationales for scrutiny by all affected, not just the members of the decision-making group; 5.1.2 Relevance, ie, “the grounds for decisions must be ones that fair-minded people can agree are relevant to meeting health care needs fairly under reasonable resource constraints.” Arguments should rest on scientific evidence, though not necessarily a specific kind of, and appeal to the notion of “fair equality of opportunity.” Although Daniels and Sabin acknowledge that stakeholder participation may improve deliberation about complicated matters, they believe it is neither a necessary nor a sufficient condition of A4R; 5.1.3 Revisions and appeal, ie, there must be an institutional mechanism to engage a broader segment of society in the process, providing those affected by a decision to reopen deliberation, and to offer decision-makers an option to revise funding decisions in light of further arguments. 5.1.4 Enforcement entails some form of regulation to make sure that the first three conditions are met (Schlander 2007).

In 2003 Daniels, Teagarden and Sabin provided a template for the application of accountability for the reasonableness in regards to benefit decisions.

“We propose an ethical template for pharmacy benefits and a fair process for using it. The template delineates four levels of decisions about pharmacy coverage, connecting ethically acceptable types of rationales for limits with decisions made at each level. It provides a framework for organizing ethically relevant reasons for coverage (or the tiered copayments). The process for using the template assures accountability for the reasonableness of benefit decisions. It requires transparency and relevance of rationales for limit setting and revisability of decisions, including through fair procedures for appeals. The template and the process facilitate broader public learning about fair limit setting (Daniels, Teagarden and Sabin 2003).”

Accountability for Reasonableness (A4R): “Norman Daniels’ and James Sabin’s theory of “accountability for reasonableness” (A4R) is a much discussed account of due process for decision-making on health care priority setting.

Central to the theory is the acceptance that people may justifiably disagree on what reasons it is relevant to consider when priorities are made, but that there is a core set of reasons, that all centre on fairness, on which there will be no disagreement. A4R is designed as an institutional decision process which will ensure that only those reasons which everybody will agree are relevant and appropriate form part of decision-making. The argument which we will put forward in this paper questions whether it is a simple matter to delineate the core set of reasons and claims that it is a potential problem in A4R that it does not provide an indication of the exact content of this process.The paper first briefly outlines the content of A4R. It is argued that disagreement on what services should be high priorities cannot be resolved solely with a reference to “due process.” In order to retain consistency over time, decision-makers are required to agree and articulate what reasons qualify as relevant and how conflicting reasons are to be balanced in the course of the process.The second and main part of the paper then considers how the reason of “solidarity” can be handled within the A4R framework, and it is shown that deciding whether solidarity should be admitted to the core set of allowable reasons is not a simple matter (Daniels and Sabin).”

Vulnerability, “the susceptibility to harm, results from an interaction between the resources available to individuals and communities and the life challenges they face. Vulnerability results from developmental problems, personal incapacities, disadvantaged social status, inadequacy of interpersonal networks and supports, degraded neighborhoods and environments, and the complex interactions of these factors over the life course. The priority given to varying vulnerabilities, or their neglect, reflects social values. Vulnerability may arise from individual, community, or larger population challenges and requires different types of policy interventions; from social and economic development of neighborhoods and communities, and educational and income policies, to individual medical interventions (Mechanic and Tanner 2007).”

“The logic of cost-effectiveness, as adopted by NICE and in contrast to traditional cost benefit analysis, does not represent an orthodox application of economic welfare theory [5-9]. The development of the cost-effectiveness framework was, instead, heavily influenced by decision analysts with operations research backgrounds, who were striving to transfer methods used to optimise the efficiency of manufacturing processes to the production of health (Schlander 2007).”


Folksonomies, tags, categories, folders, keywords: vulnerability, vulnerability to social exclusion, public versus private, ethics, accountability for reasonableness, priority setting, resource allocation, fairness, solidarity, at-risk youth, at-risk populations, social capital, distributive justice, fiduciary relationships, professional ethics, prioritisation, healthcare resources, a rationally coherent and broadly justifiable regime for prioritising healthcare, accountability for reasonableness, benefits accountable, reasonable resource constraints, share medical resources, special moral importance, touchstone question, health care limits, market accountability, fair process, managed behavioral health care, coverage decisions,


Footnotes

1. The 2007 Health and Human Services Poverty Guidelines lists the threshold for poverty as 4 persons in a household with a combined income of $20,650.


David Welch is Professor of Political Science and Director of the Trudeau Centre for Peace and Conflict Studies at the University of Toronto.

 

Melissa S. Williams “is Professor of Political Science and founding Director of the Centre for Ethics at the University of Toronto. She is also Editor of NOMOS, the Yearbook of the American Society for Political and Legal Philosophy. Williams teaches in the history of Western political thought, contemporary democratic theory, feminist theory, American political thought, and ethics in the public sphere. “Williams’s research is predominantly in contemporary democratic theory; it frequently addresses core concepts in political philosophy through the lens of group-structured inequality, social and political marginalization, and cultural and religious diversity. Her first book, Voice, Trust and Memory: Marginalized Groups and the Failings of Liberal Representation (Princeton University Press, 1998), develops a theoretical defense of descriptive representation for historically marginalized groups. It won the Foundations of Political Theory Section’s award for the best first book in political philosophy. More recent work has addressed the relationship between peace and justice in the liberal theory of toleration; conceptions of citizenship in an era of globalization; and justice for indigenous peoples. Williams currently has two book projects under way: Equality, for the Routledge Series on Concepts in Political Philosophy; and Reconstructing Impartiality, which begins from feminist and difference-based critiques of liberal impartiality and seeks to develop an alternative account of “situated” or “contextual” impartiality within law-governed relationships. She has published thirty articles on these and other topics in Political Theory, the Canadian Journal of Political Science, numerous edited volumes, and other international journals. Williams has also co-edited a number of works: Identity, Rights and Constitutional Transformation (1999; with Patrick Hanafin); Political Exclusion and Domination (NOMOS XLVI, 2005, with Stephen Macedo); Humanitarian Intervention (NOMOS XLVII, 2005, with Terry Nardin); Toleration and Its Limits (NOMOS XLVIII, forthcoming, with Jeremy Waldron); and Moral Universalism and Pluralism (NOMOS XLIX, forthcoming, with Henry Richardson). Williams was Visiting Faculty Fellow at the Center for Ethics and the Professions at Harvard University (1996-97), Visiting Professor in the Department of Philosophy at the University of Amsterdam (2000), and Laurance S. Rockefeller Visiting Professor for Distinguished Teaching at the Center for Human Values at Princeton University (2000-2001). A former winner of the Leo Strauss Award for the best doctoral dissertation in political philosophy, she has served APSA as a member of the Leo Strauss Award Committee as well as on the Foundations of Political Thought Section’s First Book Award Committee. She is a regular and active participant in ASPA meetings (APSANET).”

Bibliography and Webliography

APSANET (American Political Science Association) Profile of Melissa S. Williams

Daniels, Norman; Teagarden, J. Russell; Sabin, James E. 2003. “Pharmacy Benefits: an Ethical Template for Pharmacy Benefits.” Health Affairs: the Policy Journal for the Health Sphere. 22:1:125-137.

Daniels, Norman, Sabin, James E. 1997. Limits to health care: fair procedures, democratic deliberation, and the legitimacy problem for insurers. Philosophy and Public Affairs. 26:4: 303-350.


Daniels, Norman, Sabin, James E. 1998. The ethics of accountability in managed care reform. Health Affairs. 17:50-64.


Daniels, Norman, 2001. Justice, health, and healthcare. American Journal of Bioethics . 1:2: 2-16.


Daniels, Norman, Sabin, James E. 2002. Setting Limits Fairly – Can We Learn to Share Medical Resources? Oxford: Oxford University Press.


Hasman, Andreas; Holm, Søren. 2005. “Accountability for Reasonableness: Opening the Black Box of Process.” Health Care Analysis. 13: 4. December:261-273(13).

Lieberman, Trudy. 2007. “Let the CHIPs Fall…” The Nation. September 20: October 8, 2007.

Mechanic, David, Tanner, Jennifer. 2007. “Vulnerable People, Groups, And Populations: Societal View: Definitions & Determinants.” Health Affairs: the Policy Journal for the Health Sphere. 26:5:1220-1230.

Schlander, Michael. 2007. Evidence submitted by the Institute for Innovation; Valuation in Health Care (NICE 18). United Kingdom House of Commons Select Committee on Health. Written Evidence. March 16.

Schlander, Michael. “The use of cost-effectiveness by the National Institute for Health and Clinical Excellence (NICE): No(t yet an) exemplar of a deliberative process.” http://jme.bmj.com/preprint/schlander.pdf

 

 

Welch, David A., Williams, Melissa. 2002. “Medicare through the Rawls Lens.” Globe and Mail. Op-Ed. December 3. Temporarily posted at http://docs.google.com/Doc?id=ddp3qxmz_56f423xr

Emanuel, Ezekiel J. 2002. “Review of Daniels and Sabin’s Setting Limits Fairly – Can We Learn to Share Medical Resources? (2002).” The New England Journal of Medicine. September 19.

Flynn-Burhoe, Maureen. 2007. “How to allocate scarce medical resources is a touchstone question with ethical, economic, social and political dimensions.” >> Speechless . September 24.

Flynn-Burhoe, Maureen. 2007. “How to allocate scarce medical resources is a touchstone question with ethical, economic, social and political dimensions.” >> Google Docs . September 24.

http://docs.google.com/Doc?id=ddp3qxmz_370dx2m96



According to TD Bank Financial Group Economists Drummond and Tulk (2006) wealth disparities will intensify. They paint a dismal picture for Canadians excluded from the top quintile. Prospects are bright for Canada’s 22 billionaires and others in that elusive group of Ultra High Net Worth (UHNW) ie c. .004% of Canadian families (Stenner et al., 2006 ), who hold more than $10,000,000 in assets. In sharp contrast to Canadians in the four lower quintiles, the UHNW benefited with large increases in wealth since 1984. Unlike real estate held by the lower quintile, these rare families saw their luxury homes, properties, businesses and collections rise in price. With these additional assets they were able to invest, many in tax-free RRSPs, so their net worth grew. “If investment returns rise the trend towards growing wealth disparities will likely intensify. This could be compounded by sluggish wage gains in the low end and the financial challenge of immigrants – the main source of growth in the younger, less affluent population (Drummond and Tulk, 2006).”

Considerable wealth was accumulated in Canada between 1999 and 2005. In 2005 net worth increased by 41.7% to nearly $1.5 trillion (US?). The most recent Statistics Canada report revealed today that the Canadian national net worth reached $4.8 trillion by the end of the third quarter. While in terms of an economist’s algorithm this translates into an average of $146,700 per person. In reality only the a tiny number of Canadian households benefited. “The gain in net worth resulted from an increase in national wealth (economy-wide non-financial assets) as well as a sharp drop in net foreign debt. National net worth grew 2.8% in the third quarter, the largest increase in more than two years (Statistics Canada 2006 )”.

Drummond and Turk are concerned that in spite of the dramatic growth in Net Worth, there is a significant portion of the population with little or negative Net Worth (debts/assets ratio) in 2005.

Although Drummond and Turk cite the World Institute for Development Economics Research as their source in regards to situating the seemingly overwhelming disparity between the 10% of households that are extremely wealthy and the lower quintiles. (I believe they refer to reports by Senior Researcher of the World Institute for Development Economics Research (WIDER) of the United Nations University, Mark McGillvray (2005) whose research is available only of the deep Internet — an exclusive members-only club.)

For the first time however, 165 of the UNHW families accepted to be interviewed by the Stenner Group. The True Wealth Report (Stenner 2006 ) reveals that the most popular past-times of UNHW are traveling (particularly to London, Paris, Vienna, New York and Vancouver staying in ), playing golf and taking part in other sports, collecting art and antiques, drive BMW’s, Volvo’s or Porsches. They claim their philanthropy is tied to both their religious faith and strategic money management (Stenner et al., 2006 ).

(Morissette and Zhan, 2006)

According to Stats Can economists in their recent report who refer to research by Western University Economist James B. Davies and Shorrocks Economist with the United Nations World University, it is to measure the actual holdings of the uber-wealthy. Forty-eight percent of Canadian wealth might be held by less than 1% of the Canadian population; (Davies and Shorrocks, 2000, Davies, 2003).

Western University Economist and co-author of publications with Shorrocks, editor for the United Nations World University publications and Financial Post journalist (Chevreau, 2003) both cited Shillington’s C.D. Howe Insitute report (2003), revealing an unintended disincentive for the those who earn under $50,000/annual to save. “Shillington (2003) has used Statistics Canada’s 1999 Survey of Financial Security to illuminate what he calls the “futile saving” problem. He looks, first, at the savings of “near-seniors”, those households where the older spouse is aged 55 – 64. He finds that 21% of these households have no retirement saving, and in total 53% have retirement savings of less than $100,000. On the grounds that savings of $100,000 would not permit the purchase of an annuity of more than about $10,000 Shillington believes that the majority of these people will be GIS recipients in retirement. Their savings are thus “futile”, since they will be at least half confiscated by the GIS taxback.17 Turning to actual GIS recipients, Shillington reports that about 23 percent have an RRSP, with an average value of $43,000; 29 percent have an RPP, with an average value of $65,000; and about 40% have either an RRSP or RPP. In Shillington’s view this represents the result of a gigantic fraud, however unintentional. Governments and financial institutions have advertised the importance of saving for retirement very heavily, and the annual campaign to get RRSP contributions is a vigorous one. The voices warning low-income people that this is in no sense an “investment” are tiny ones.” (Davies, 2003) p. 28

Shillington concluded that

poor seniors dependent on the federal Guaranteed Income Supplement (GIS) and its means-tested provincial and municipal counterparts should not bother with RRSPs. To do so means losing GIS benefits, rent subsidies, drug benefits, provincial aid programs like Ontario’s GAINs and similar welfare programs.” Once RRSPs create income from Registered Retirement Income Funds after 69, $1 in income reduces GIS benefits by 50¢. Since half of GIS recipients pay income tax, they face an effective marginal tax rate of 75% on extra income. In some cases involving dividend gross-ups, the effective top-rate savings may pass 100%, Mr. Shillington said. For them, “RRSPs are a terrible investment. They are victims of a fraud, however unintentional.” Saving $100,000 in RRSPs may be futile if that is your target. However, it does not mean younger people with $100,000 already saved should stop, as long as they are on the way to accumulating several hundred thousand dollars by the end of their working lives. “RRSPs can be dangerous to your financial health” is the subtitle of Free Parking, a self-published book by “reformed financial planner” Alan Dickson. “I totally agree with the report,” Mr. Dickson said. Citing 2001 Statistics Canada data, Mr. Shillington said of $1-trillion in retirement assets, $600-billion is in employer pensions, $340-billion in RRSPs and $70-billion in RRIFs. (Chevreau, 2003)

“National net worth reached $4.8 trillion by the end of the third quarter, or $146,700 per person. The gain in net worth resulted from an increase in national wealth (economy-wide non-financial assets) as well as a sharp drop in net foreign debt. National net worth grew 2.8% in the third quarter, the largest increase in more than two years (Statistics Canada 2006 )”.

Clever people like Derek Foster who know how to work the system trigger angry responses against publicly-financed assistance for the lowest quintile. (Heinzl, 2005) Foster (born c. 1961) began making astute investments while still in university. He learned from finance gurus Peter Lynch and Warren Buffett. In 2005 he continued to earn enough from his total investments (which total six digits) in Starbucks, Colgate-Palmolive, Rothmans Inc., Royal Bank of Canada, Corby Distilleries Ltd., Manulife Financial Corp., George Weston Ltd., Pembina Pipeline Income Fund, Canadian Oil Sands Trust and a dozen or so others, that he and his family of four can live modestly without ever having to work again. Their low income c. $30, 000/annual actually allows them to enjoy certain publicly-financial benefits designed for low-income earners with no assets (Heinzl, 2005). Others include Dianne Nahirny’s Stop Working, Start Living (http://www.smartmakeovers.com) and Alan Dickson’s Free Parking and Advance to Go (http://www.freemoneypress.com)

(McGillivray, 2005)
(McGillivray, 2005)

Unfortunately I cannot use this source. References have no weight: [1.4 million Canadian children -- about one in five -- living in poverty, an increase of more than 500,000 since 1995. [. . .]“Housing, health, education, labour rights and a healthy environment are all included in the covenant,” she said. “Wealthy nations like Canada are expected to take steps toward meeting the goals of the covenant, but since Canada last reported in 1993, it has taken many steps backward.” [. . .] But life may not be as rosy as the UN survey found. A recently released Indian Affairs study said off-reserve aboriginals came in about 35th and on-reserve natives rank about 63rd in the world, putting their standard of living in Canada at the same level as Mexico’s and Thailand’s. The Ottawa-based Centre for the Study of Living Standards recently said anyone who has tried to measure Canadians’ quality of life has found it’s worsened considerably during the 1990s, even though the economy has bounced back from the last recession. (McGran, 1998 )

With more than a billion people living on less than one dollar per day, some evidence of increasing gaps in living conditions within and between countries and the clear evidence of substantial declines in life expectancy or other health outcomes in some parts of the world, the related topics of inequality, poverty and well-being are core international issues. More is known about inequality, poverty and well-being than ever before as a result of conceptual and methodological advances and better data. Yet many debates persist and numerous important questions remain unanswered. This book examines inequality, poverty and well-being concepts and corresponding empirical measures. Attempting to push future research in new and important directions, the book has a strong analytical orientation, consisting of a mix of conceptual and empirical analysis that constitute new and innovative contributions to the research literature.Mark McGillivray is a senior researcher with the World Institute for Development Economics Research (WIDER) of the United Nations University.

Selected webliography

Chevreau, Jonathan (2003) RRSPs a bad option for low-income earners Financial Post.
Davies, James B. (2003) Social and Economic Risks to Seniors in Ontario. Ontario Panel on the Role of Government (OPRG). Toronto.
Davies, James B. & Shorrocks, Anthony F. (2000) “The Distribution of Wealth.” In Atkinson, A.B. and Bourguignon, F. (Eds.) Handbook of Income Distribution.
Drummond, Don & Tulk, David (2006 ) Lifestyles of the Rich and Unequal: an Investigation into Wealth Inequality in Canada. TD Bank Financial Group.
Heinzl, John (2005) The ‘Youngest Retiree’ Tells How To Punch Out Of The Workplace. Globe and Mail.
McGillivray, Mark (2005) Inequality, Poverty and Well-being, Helsinki, Finland, Palgrave Macmillan.
Mcgran, Kevin (1998 ) Anti-poverty activists take case to the United Nations. The Canadian Press. Toronto, ON.
Mcquaig, Linda (1995) Shooting the Hippo: Death by Deficit and Other Canadian Myths, Toronto, Viking
Mcquaig, Linda (1998 ) The Cult of Impotence: Selling the Myth of Powerlessness in the Global Economy, Toronto, Penguin Books
Morissette, René & Zhan, Xuelin (2006 ) Revisiting Wealth Inequality. Perspectives on Labour and Income. Ottawa, ON, Statistics Canada.
Shillington, Richard (2003) New Poverty Traps: Means-Testing and Modest-Income Seniors. C. D. Howe Institute. Backgrounder. 65.
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This post is being written on line back and forth between articles, EndNote, zotero and the slow world. It is currently being updated.

Flynn-Burhoe, Maureen 2008. “Food Fertilizer Fuel.” >> papergirls.wordpress.com

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