Why don’t we turn EI into an insurance plan?

While EI is indeed an abbreviation with the word insurance in it, it is not an insurance plan. Many people have different opinions of what EI is and what it should be. It appears that many if not most are wrong.

In trying to make EI appear as an insurance plan, payments made by workers into the plan are called “premiums”. Sorry folks, but payments made by workers for EI are taxes and nothing less. Revenues from EI were indeed once kept in a fund specifically for the purpose of payouts on claims. When workers paid more into the EI fund than they drew out, a surplus was generated. Surplus funds never escape the eyes of free spending politicians for long unfortunately and EI “premiums” now are directed into government hands thus turning them into taxes.

While serving as Canada’s finance minister some years ago; Paul Martin spotted billions of dollars languishing away from his greedy fingers in an EI surplus. Typically, when an insurance fund generates a surplus either the premiums are reduced or a larger dividend is paid out to the shareholders in the insurance company. As EI was a government program without formal shareholders, premium reduction was really the only option. Surplus funds could have been invested as well so that revenues could lead to further reduction in premiums and the funds could have been saved for increased payouts should there be a sustained economic downturn. What Paul Martin did though was utilize a majority Liberal government in order to change the very nature of the entire program and find a different way to use surplus EI funds. The Chretien Liberal government passed legislation allowing government to take surplus EI funds and direct them to general revenue.

As soon as government could take funds from EI payments and spend them elsewhere, the program ceased being an insurance plan in any manner. Premiums are now actually taxes and payouts are essentially a form of social service. EI is not an insurance plan at all, it is just a large social service program with different steps for qualification and limits on the terms of payout.

The Harper government has been no better than the Chretien government in this regard. Surplus EI funds (overcharged taxes to the employed) are still being directed to general revenue and there has been no indication of an appetite to change the program to an insurance plan. The Harper government is rightly trying to move people away from chronic utilization of EI payouts, but the government is failing in it’s refusal to separate EI as a program.

 With EI being essentially a separate welfare program for the employed, it has unfortunately turned into what some people see as yet another entitlement from the government. Many people are using the program as a supplement to their incomes and they feel it is their right to do so. An insurance plan is not supposed to act as a savings plan, a retirement plan, an income supplemental plan, a regional income balancing plan or a supplemental vacation pay plan. Unfortunately EI is being used as all of the aforementioned things by many.

An insurance plan should be something that covers a circumstance that is unforeseen and can’t be properly planned for. Seasons are pretty predictible in their annual appearances for example so one really should not be insuring themselves for the changes of season. If you know that you will be laid off every year at the exact same time then you need either a savings plan or an alternative seasonal job. No real insurance plan would cover a person for something that happens as predictably as a sunrise.

With a real insurance plan, people’s premiums will rise and fall with their risk levels. Bad drivers pay huge automotive premiums while good ones see a reduction in premiums. A person’s reward for not needing insurance is reduced premiums, not a guaranteed payout. How often do you hear people say “I have paid in all my working life, it is my right to draw out!”.  Damnit no! That is a savings plan then, not an insurance plan. If you don’t crash your car for years, do you get to file a claim and collect anyway? If your house does not burn down, does this mean you get your homeowners insurance premiums back?

I think it is important that workers have a fallback should they unexpectedly find themselves unemployed for awhile. The buffer of insurance benefits can allow workers to seek new employment, move to a different region or retrain for a new line of work. I can live with participation in an insurance plan being mandatory for workers too. Whether run at arms length by government or even privately, an insurance plan can and will work. We need a real insurance plan though!

A real insurance plan will charge higher premiums for people in fields of work that are of a high risk for unemployment and will charge individuals who make more claims than others a higher premium as well. Premiums and payouts would reflect regional needs as well. People who rarely or never claim will find their premiums to be exceedingly small over time. While a minimum participation would be required, people could opt-in for extra coverage (with an increased premium of course) should they wish to. This reduces incentive to be unemployed while still covers a person should they need it.

Let’s be clear, among businesses that I despise insurance companies top the list. Whether privately run or government run, an insurance plan will have to be closely regulated. Benefits must come close to matching premium revenues and surpluses must not go to unreasonable salaries for management or payouts to company owners. Funds must never go to general government revenue either!

Until we actually change EI into an insurance plan we are simply deluding ourselves in calling it one or trying to treat it like one. The current incarnation of “Employment Insurance” is a tax-revenue generating scheme that is used as a political tool for regional political play. It is past time that we re-examined the role of EI and it’s form. The entitlement and abuse due to the current EI (welfare) system is not beneficial to Canadians at large.

If we are going to have an “Employment Insurance” plan, let’s make it a real one.

Let’s face reality, prostitution is simply never going away.

 This afternoon I decided to take a walk down Center Street North to Lina’s Market to grab some groceries  (strongly recommend that place to anybody for Italian food by the way). I was thinking of blogging further on the deteriorating condition of Center Street North as City Hall continues to sit on it’s hands with whether or not they will run an LRT line up Center Street in the future. This indecision by City Hall has left a large tract of the city in a development limbo which is leading to an increase in crime and a fast growing stretch of slum in what used to be a nice part of the city. Who in their right mind would maintain or develop a property when there is potential that it could soon be expropriated and torn down at any time?

 Walking is better way to get a look at how things are. I drive Center Street quite often but getting out on foot one can see much more closely and clearly how things are doing. Needless to say, in my hike I found that things were indeed even worse than I had thought. Virtually every house on Center that has not already been boarded up or torn down is in brutal disrepair. With an indifference to property maintenance and improvement, landlords have rented to predominantly the seediest of tenants. Crack houses are blossoming and who knows what else is going on in those firetraps along the street.

It is not only  rather undesirable people inhabiting these properties, undesirable businesses have been moving in as well. The are many many houses with sheets over the windows, a lighted “open” sign and the word “massage” painted on the window. A few years back I was quite naive and never really paid much attention to the massage parlours fronting for prostitution in the city and never really realized how many there were. In the 2009 Calgary Glenmore by-election I was tasked with trying to find a space for a campaign headquarters. In one strip-mall, I had found what I thought to be a good office space that we could use. I brought another person along to have a look and he immediately said that it was inappropriate. I was confused and asked why. He pointed to the office next to it which had it’s windows painted over and nothing aside from a lit “open” sign. He explained that it was a massage parlour providing prostitution. We found a better location and the campaign carried on. Media often came by to our headquarters and I can’t help but wonder what sort of awkward scenes may have ensued had we rented the first spot I had found as some “client” of the rub-and-tug next door comes out and bumps into a camera crew.

 I am digressing as is my wont. Either way, that experience led me to peripherally watch for those businesses and when you look for them it is quite surprising just how prolific they are in the city. There are many legitimate businesses providing massage of course. They are pretty easy to identify as they will be sure to trumpet that their massage services are therapeutic and advertise the credentials of their practitioners. I am sure that legitimate massage practitioners want more than anybody to ensure that the clients they get want no services aside from a proper massage.

 Along with these “massage” businesses, street prostitutes are beginning to appear. Our former community association president had frequent and disturbing prostitution issues right outside of his house. I was propositioned while simply sitting in my truck waiting for Jane to come out of a convenience store. It was surprising in her boldness and disturbing personally in that she felt I looked like a potential customer.

 Now in walking back today, I passed the the Northminster United Church on Center and 32nd Avenue. This church provides daycare to children and has a fenced play area right out front. I was mortified and outright disgusted to note a discarded condom while walking past the church parking lot. I can only guess that some creep had utilized the church parking lot to use the services of one of the local prostitutes. This activity, the location where it was carried out in and the bio hazard that was left behind really drives home why prostitution presents a great threat to residential communities and why it needs to be brought under control.

In light of these kinds of problems the kneejerk response is invariably to call for a police crackdown on prostitution in the area. While increased law enforcement may indeed reduce the overt prostitution in my area, it will not end it. The prostitutes, their pimps and their clientele will simply slide over into another district and the problem will be shared with a whole new crowd of innocent residents.

Afganistan has some of the strongest laws against prostitution in the world. Despite that, it is still happening there. If being potentially executed or being incarcerated for decades won’t stop prostitution can we finally safely assume that increased law enforcement is not the solution to this problem?

 I am sure if one interviewed 50 prostitutes they would find 50 different stories as to why they entered that line of work. Whether the person had addiction issues, poverty issues, mental health issues or even they possibly simply like that kind of work, some people will be drawn to taking the route of prostitution in order to make money. The legality of the issue really does not factor into things.

We have to learn to accept that there will always be an element of people who want to pay for sexual services and there will be an element of people providing those services. If we can be realistic and work from that basis we can work towards mitigating the real damages that prostitution causes.

It is not the act of the prostitution in itself that causes the most damages to communities. The problem is the involvement of the criminal element in the trade bringing associated crime with it. Pimps and gangs thrive on the abuse of women in prostitution and prostitutes working without pimp and gang protection can find themselves abused by their clientele. Drug use usually comes hand in hand with prostitution. In following with supply and demand, one can rest assured that dealers are always nearby and ready to supply addicted prostitutes as they earn their funds. These dealers will happily sell to our children as well and cause more neighborhood risks as their violent turf wars occasionally erupt. Massage parlours are notorious for practicing human slavery as dependent immigrant women find themselves trapped in those places. Underage girls can be found on the streets and in these brothels too. Disease is rampantly spread in this unregulated and illegal industry as well.

 The vast majority of the associated problems with illegal prostitution can be eliminated if we simply accepted reality and legalized and regulated prostitution. A red light district can be established well away from residential areas. Sex trade workers can be properly screened for diseases and it can be ensured that they are of legal age and willingly participating in the trade. Pimps can be eliminated and both clients and prostitutes can have their safety ensured in a protected environment. Taxes could be paid by businesses as well of course.

It is true that many addicted or otherwise troubled prostitutes would not qualify to work in a controlled brothel. These people would find the industry in street prostitution to be far less lucrative though as I imagine that most of those who frequent prostitutes would prefer to go to a safe and legal facility rather than take on the associated risks that come from patronizing street hookers. Police could focus on the remaining illegal and unregulated prostitution activities which could greatly help in reducing the practice. It can be hoped that with illegal prostitution being less lucrative the troubled people participating in in may be more likely to seek help to get off the streets.

 Legalizing prostitution will hardly solve all problems by any stretch of the imagination. Considering that the practice has been happening for millenia though we have to accept that it is not going away and we really should work on a realistic approach to this practice. This facade of enforcement and illegality is simply making things worse and pretty much everybody is losing here.

Essentially, if a person is of the age of majority it is none of our business what they legally chose to do with their own bodies. Supporting the legalization of prostitution does not mean one condones the practice, it simply means accepting reality. Nobody wants their daughters to make a living that way and paying for services cant be the most healthy sexual practice for men. One can oppose the law without condoning the practice.

The late great George Carlin covered this in a great rant. It is laden with expletives though and I do suggest that people not play this video at work or around kids.

Lets deal with this issue realistically. I am tiring of seeing the damage that the current setup for prostitution is doing to both people and my community. This hybrid of legal/illegal prostitution is simply a failure for all of us.

Just do your job.

A quick post before I head out for another adventurous day on Australia’s highways.

I am not a huge Louis CK fan but his rant directed at our whining, entitled youth is spot on and I just had to share it.

This goes out to the pissing/moaning/rioting students in Quebec, the “occupy” clowns around the nation and anybody else who was offended that Flaherty dared suggest that any job is a good job.


ht to The Authenticity Hoax who intially dug up this vid.


I guess BC is getting tired of the prosperity.


While it still is a year away and we certainly saw the collective worthlessness of pollster’s projections in the recent Alberta election, the current polled trends in BC are disturbing. It appears that like a beaten wife who keeps returning to her abuser, BC wants to again embrace the governance of the party that castrated their economy for nearly a decade. It looks like the BC NDP is polling at about 50% right now.

 There are few reliable constants in the world but one that can be relied upon is the economic disaster that comes with a provincial NDP government. Bob Rae proved that the largest and most robust provincial economy in Canada could be brought to it’s knees with his catastrophic term as the Premier of Ontario. Saskatchewan lagged the nation in economic growth and activity under an NDP government as the province lost most of it’s youth in an exodus to Alberta seeking jobs. Manitoba is determined to remain a dependent little brother in confederation and under the inept guidance of their NDP government they are achieving that goal in spades.

 I remember very well working on oil exploration projects in the North where I literally would survey the perimeter of our program right on top of the BC/Alberta border. We would not venture an inch on to the BC side as our costs would explode and it simply was not worth it for our clients to pursue data there. Fort Saint John and Dawson Creek were in dire straits as the BC NDP government regulated and taxed the economy to the point where BC became a have-not province within Canada.

 Along with the consistency of NDP governments destroying economies is the consistent rebound for the economy when the socialists are finally tossed out. Saskatchewan is now a fast growing economic powerhouse in Canada thanks to the rational guidance of the Sask Party government. BC has been booming for over 10 years as the Liberal government undid much of the economic neutering caused by the previous NDP government. Ontario’s economy exploded under the Conservative government that replaced Rae’s grossly inept NDP. The pattern is clear and constant.

Despite such stark and repeated examples of the damage that NDP government’s cause, a large segment of Canadians simply refuse to accept this reality. Like a crack addict who knows the pipe is killing him yet can’t resist putting it back in his mouth again, provinces seem prone to repeated self-destructive behaviour in electing socialist governments.

 Please, please, please BC wake up! If you are tired of the Liberals than by all means pursue an alternative. Going back to the NDP however is simply an example of the cure being worth the disease. I do hope that this trend changes as I would hate to see our provincial neighbors dropped back into the economic toilet again.

 Alberta and Saskatchewan can’t keep up with subsidizing Quebec alone.


How long before we crash?

A democracy cannot exist as a permanent form of government. It can only exist until the majority discovers it can vote itself largess out of the public treasury. After that, the majority always votes for the candidate promising the most benefits with the result the democracy collapses because of the loose fiscal policy ensuing, always to be followed by a dictatorship, then a monarchy.

~Alexander Fraser Tytler

Tytler wrote that quote over 200 years ago (yes I understand that some dispute the quote origins). I am still trying to remain optimistic in viewing that quotation as being a warning rather than an immutable prophecy. It certainly is startlingly accurate in it’s application to the current trend among modern democracies.

Ayn Rand painted a world in Atlas Shrugged where weasels and parasites had brought the world’s productive to their knees through punitive and envious policy (always cloaked in the words “fair” and “equal”). The parallels that can be drawn between Atlas Shrugged and many modern governments, industries and actions are almost discomfortingly common and accurate. Look at how our government continues to bail out Air Canada & give them preferential regulatory treatment while essentially punishing upstarts such as Westjet for their daring to be profitable and productive. Now look at it as if it were a railway and change the names of the players; you essentially are seeing Atlas Shrugged being played out.

The sense of entitlement that we see growing in developed societies is disturbing. We saw thousands of kids damaging and squatting in parks around the world essentially protesting nothing aside from a feeling that the world owes them something that they apparently are not getting. Look right now to the thousands of whining students in Quebec who while enjoying some of the most subsidized education in the entire world feel that they should riotously protest for more fruits from the labors of others.

In Greece the government finally went totally broke. Austerity was not a consideration for Greece, it was a necessity. Despite this stark and apparently self-evident reality, thousands of union-led Greeks poured into the streets and rioted demanding money and entitlements that simply did not exist. Despite their demands being about as realistic as asking that the moon be moved closer to the earth for a better view, these people preferred to delude themselves into thinking that their government could somehow produce resources from nothing if only the collective temper-tantrum of the citizens was loud enough.

Even the Socialist government of Greece realized that providing the entitlements was simply impossible. Cuts were tabled and austerity measures came into play. Due to that, the people of Greece elected a government who simply promised the impossible and have ensured their total economic collapse will be coming soon.

France was sucked in with the entitlement siren song in last week’s elections as well as they elected a government that promised to tax the “rich” at 75% while reducing the retirement age to 60. Yes the idiotic electorate has essentially put the last nail in their economic coffin as the productive are doubtless already fleeing and I am sorry folks but early retirement is not what is going to aid a country already mired in massive debt. I wish I could say that only the French would think that the solution to deep debt was to work less but I am afraid that this trend is happening all over.

The collision course with an unsustainable debt was deferred by the Obama government last year but the trend has not changed. The debt is growing at catastrophic levels and eventually it will have to come to a hard end.

In Alberta we are only better by degree. Despite rallying resource prices we are still mired in deficit and will be into true debt soon if the Redford government comes through with even half of the promises that were made. Sadly, making unsustainable promises is an effective electoral tactic as we most recently observed. There was more to the Redford win than simply mass spending promises but that was indeed a large part of it. The electorate simply voted for whoever promised the most goodies and Redford promised in the billions. Nobody wanted to really bother themselves with thinking of how we will actually pay for all that excess.

The temptation remains to spend one’s way into power and for parties it certainly is hard to resist when looking at the success of such strategies. The Wildrose Party will be working and maturing in the next four years and I hope that the party continues to strive to be fiscally responsible despite the temptation to try to outspend the government. The temptation to centralize power in a grassroots party is strong too and we are seeing such attempts well under way in the Wildrose Party as some see the membership as a hindrance rather than a resource.

The quotation at the beginning of this posting does not need to be a prophecy. The Wildrose Party can be the voice of reason who can keep Alberta from sinking even more deeply into the unsustainable defict trap. People are making excuses and justifications for borrowing all over the place. To be blunt, they are baffling with bullshit. We simply can’t spend more than we take in. All we are doing is putting off the inevitable financial crash so that the next generation is forced to pay the price.

The membership of the Wildrose Party must be vigilant and fight the temptation to turn itself into the Progressive Conservative Party under a new name or these years of work will truly have been for nothing. Fiscal responsibility can happen and the electorate will embrace it if it is presented well by a trusted source. The Wildrose Party does not need to change it’s base principles or mandate in order to win down the road. We need to evaluate how we present and pursue those principles though.

Let’s turn Alberta into a fiscally stable island while the world around us buries itself in debt. The way to begin though will be by ensuring that our next government is indeed dedicated to that principle and goal. Ground level activity and AGM participation will be critical for the Wildrose Party in the next few years. If we don’t assert ourselves as party members, I assure you that the party will continue to centralize even further and we will simply be replacing one group of undemocratic opportunists with another one.

Remaining debt-free is the tougher political road but it is the only worthwhile one.