Mark, Chapter 5.
And they came over unto the other side of the sea, into the country of the Gadarenes.
And when He was come out of the ship, immediately there met Him out of the tombs a man with an unclean spirit, who had his dwelling among the tombs; and no man could bind him, no, not with chains: Because that he had been often bound with fetters and chains, and the chains had been plucked asunder by him, and the fetters broken in pieces: neither could any man tame him. And always, night and day, he was in the mountains, and in the tombs, crying, and cutting himself with stones.
But when he saw Jesus afar off, he ran and worshipped Him, and cried with a loud voice, and said, What have I to do with thee, Jesus, thou Son of the most high God? I adjure thee by God, that thou torment me not.
For He said unto him, Come out of the man, thou unclean spirit. And He asked him, What is thy name? And he answered, saying, My name is Legion: for we are many. And he besought Him much that He would not send them away out of the country.
Now there was there nigh unto the mountains a great herd of swine feeding. And all the devils besought Him, saying, Send us into the swine, that we may enter into them. And forthwith Jesus gave them leave. And the unclean spirits went out, and entered into the swine: and the herd ran violently down a steep place into the sea, (they were about two thousand;) and were choked in the sea.
And they that fed the swine fled, and told it in the city, and in the country. And they went out to see what it was that was done. And they come to Jesus, and see him that was possessed with the devil, and had the legion, sitting, and clothed, and in his right mind: and they were afraid. And they that saw it told them how it befell to him that was possessed with the devil, and also concerning the swine.
And they began to pray Him to depart out of their coasts.
Who will watch over this feverish spending?, Rex Murphy, February 14, 2009.
Spend in haste. Repent at leisure.
My instinctive response when Finance Minister Jim Flaherty brought down his (and Michael Ignatieff's) budget was: Does it contain a special, one-off fund for Sheila Fraser? Will the Auditor-General of Canada be granted special resources and extra staff to monitor the great flood of emergency spending?
After all, if Canada is moving back into the era of great federal deficits, if $12-billion for infrastructure were to be spent as fast as possible over the next two years, if all the provinces and the cities are lining up with those “shovel-ready” projects, then surely this is the very time to arm the Auditor-General, so to speak, to the scrutinizing teeth.
If the federal government is about to push buckets of cash out the door in all the haste of an emergency, powered by that fevered eagerness politicians bring to spending great heaps of public money, then giving Ms. Fraser and her office the means to cope has to be a primary consideration. For this is a fire hose of a budget, millions and millions of dollars being sprayed under high pressure in every direction. Or, if you'd prefer a slightly more dated image, it's a runaway stagecoach of a budget, the horses spooked, the driver unconscious and the passengers (that would be you, gentle taxpayers) jostled, terrified and howling the most desperate prayers in the careening carriage.
We've had experience of emergency spending before. Not so long ago. Was it not fear and trembling in the then Prime Minister's Office that launched the notorious sponsorship scandal? Following the “near-death” referendum of 1995 it was decided to assert “the federal presence” in Quebec. The perceived need to plaster everything vertical (breathing or otherwise) in Quebec with Canadian insignia saw millions rolled out to PR firms, friends of the Liberal Party, and led to the fine imbroglio that history now enshrines as Adscam.
Adscam is a delightful example of what happens in bouts of feverish emergency spending if one leaves the little matter of professional oversight and neutral bookkeeping till after the money is spent.
I leave aside almost entirely the question of whether what we may call spending under duress ever really accomplishes its goal. Save to note that the great expenditures of the sponsorship program had only one undoubted (yet, dubious still) achievement: the dismantling of Paul Martin's entire tenure as prime minister.
The essential point is quite basic. In an extraordinary time, when the government feels the need to release itself from normal spending limits and processes, the Auditor-General's office should correspondingly be given greater weight and presence. It appears her office, in fact, has not been.
Our challenges, in this regard, however, are minuscule compared to what the Americans are rushing, Gadarene-like, to do. Readers will recall the famous line of Pascal: “The eternal silence of these infinite spaces fills me with dread.” Reminds me of the American stimulus plan. Who would not, philosopher or otherwise, be “filled with dread” over the billions and billions about to tumble out of the American political system. How great is their overall stimulus package? Is it two or three trillion dollars? Is it, in fact, measurable at all? Are they attempting to stimulate their economy or void it altogether?
The numbers, whatever finally they are, are simply incomprehensible – meaning the mind cannot contain, in any meaningful way, what they signify. Who will, who can guard expenditure on this scale? There are not enough accountants in eternity. One immediate consequence is that amounts that before would stay the attention, drift past with the slight regard we give to pocket change. Twenty billion, for example, in this context is such a paltry sum. Three hundred million – mere pennies. When we hear the Senate ups the amount or takes it down by tens of billions of dollars, the change seems picayune. The Obama stimulus is so large that it has thrown out all the old familiar frames of reference.
No one can predict if the American stimulus plan will work. Anyone can predict it will entail some of the ripest and richest scandals that country has ever seen.
Our piddling $40-billion, by contrast, looks hesitant, trifling, a costive, miserly thing.
It surely is not. Which speaks all the more for insisting at the beginning of this great bailout/stimulus/injection that the protocols of oversight are far greater here than they have ever been. Sheila Fraser's office is one of the precious few Canadians will trust with at least an attempt to monitor that a great emergency stimulus doesn't morph into a pit of waste or worse.
Obama's faith-based bailout, Margaret Wente, February 14, 2009.
My cousin lost his job last week because of the recession. It was a pretty crummy job, but it paid the rent. Now he cleans out people's basements at 50 bucks a pop.
I sure hope Mark Carney, our Bank of Canada Governor, is right. Just suck it up this year, he promises, and by next year everything will be fine.
Well, maybe. But it sure doesn't feel that way.
Paul Volcker was in Toronto the other night to have dinner with a bunch of well-heeled people who hung on his every word. Everyone looks up to the former U.S. central banker, because he whipped inflation in the ‘80s and also because he's over six and a half feet tall. He genially admitted that the old system is finished. “Finance doesn't work without some sense of trust and confidence,” he said.
But all the trust and confidence are gone. The smartest people in the world thought that financial markets obeyed mathematical laws. They believed that people, in the aggregate, acted rationally. It turns out that they don't. The markets are only human after all. And so are people.
Will Barack Obama's giant bailout package do the trick? No one knows because it all depends on trust and confidence. If you believe that it will do some good, then you might spend money instead of putting it in a sock. The pundits don't believe in it, although they disagree as to why. It's either too little, too timid, too vague and too late, or else it's just another swindle of the taxpayers. In any event, after less than three weeks, they have declared his presidency an utter failure.
The only thing we know for sure is that all those billions are just the first instalment. According to Mr. Volcker, fixing the banks will cost several trillion dollars. The hardest part, if I understand the business terminology correctly, is to exorcise the voodoo loans from the zombie banks. In other words, what Mr. Obama really needs is a good witch doctor.
If only the witch doctor would arrive in time to drive out the evil spirits from my neighbourhood. But I'm afraid he won't. It has always been a hotbed of hopeful entrepreneurship. Every year a bunch of new businesses open up, and every year – generally after the January clearance sales – a few go bust. This year is worse than usual. Just last month, one brave soul (a woman, I suspect) opened a lovely little store that sells exquisite home accessories. I imagine she's been planning it for years. Every time I pass by the freshly painted storefront, I whisper to her: “Don't do it! Don't do it!” The world of retail has become ruthlessly Darwinian, and good people will get wiped out.
The voodoo bank loans aren't the only problem. Because of the recession, ordinary loans are going sour too. In the United States, everything has collapsed at once – house prices, home sales, car sales, jobs. Coming soon are widespread defaults on credit-card debt. Cities and school districts across the country will run out of money because their pension funds invested in zombie assets and their credit is no good. Florida and California are flat broke. No one has a clue what will happen next, but it's safe to guess it won't be pleasant.
“You guys in the Toronto media are spreading too much doom and gloom,” said a friend of mine who lives in Winnipeg. I admitted that it's easy to feel gloomy, especially when being in the newspaper business feels a bit like working for GM. On the other hand, we're not the only ones who are contemplating a diminished future. The other day I ran into someone who owns a service business that has survived through thick and thin.
“How's it going?” I asked. “I'm laying off half my staff tomorrow,” she told me. “I'm thinking that maybe I should close up shop.”
I am truly, truly proud, as are we all, that poky, conservative Canada has turned out to be a pillar of financial rectitude amidst the smoking ruins. Not too many cowboys here, unless you count the shooters at the Quebec pension fund, who managed to lose a staggering $38-billion last year. “Don't feel bad,” I consoled a girlfriend whose RSP went down 24 per cent. “Those big shots did even worse than you did.”
Who ever would have guessed that Canada's boring old banks would be the model for the new world financial system? If only anybody had a clue how to build it. Meantime, we'll be borrowing from ourselves for years and years, then paying it back for years after that. I'm thinking that we'll have a long, long time to learn to live on less.
If only bailouts were like Tinker Bell, it would all be so much easier. Mr. Obama could say, “Clap, clap if you believe in my bailout plan!”, and we'd all clap like mad, and the economy would magically spring back to life. Faith saved Tink, and only faith will save us all. Failing that, there's not much that you or I can do, except renovate our houses and apply for a tax rebate. Personally, I'm willing to try anything. I don't need a deck, but I'll build one anyway. I'll build two. I'll ask the contractor to hire my cousin. He needs a job.