By Goodwin Ginger
There really is no end to the logic of corporate social irresponsibility no matter who the shareholders are. Bell Canada enjoyed for the longest time a state granted monopoly for which it had to submit to the arduous condition that state regulators guaranteed its owners a positive ROI. When competition was finally allowed Bell continued its ownership over the infrastructure which it in turn then leased to its own competitors. Again the terms of the leases were policed by the state to ensure that Bell shareholders received a guaranteed ROI.
Today Bell announced that it will be converting into an income trust. Why you ask? Corporate taxes. Currently Bell has a state granted tax shelter which expires in 2007. Bell’s corporate taxes would have increased from 250 million to 800 million in 2008. The conversion will save them (shareholders) 800 million dollars in taxes that would have gone into government coffers. This is a net transfer from Canadians to the shareholders of Bell of 800 million dollars.
To be clear Canadians will be deprived of around 800 million dollars a year that could have gone to health care education, debt repayment, tax relief for workers or transfers to the impoverished among the elderly. That works out to 8 billion over ten years not including interest. One does not have to be an economist to figure out which way redistribution works in the current era: from the least wealthy to the most wealthy.
Next time you meet an Ontario teacher be sure to thank them for their greed. What a teacher you say? Well yes the OTPF is the teachers pension fund and it has been at the forefront of the shareholder value movement since the 1990s. The teachers pension fund has been demanding value for its stake: causing in train downsizing, contracting out of union jobs and now conversion to an income trust. Sure makes it hard for us to want to stand in sympathy on their strike line. Solidarity forever eh?