If you are a TD Bank customer you should be concerned. Another interim report to the Ontario government has been received from TD Bank Chair Ed Clark. He and his panel of former politicians are supposed to be telling Ontario Finance Minister Charles Sousa what assets should be sold or become more profitable to help with the province’s deficit problem. What we are hearing does not sound like very good financial advice.
In his 77-page report amusingly entitled “Retain and Gain: Making Ontario’s Assets Work Better for Taxpayers and Consumers.” Clark seems to forget he is a banker and tells us how to create jobs in liquor stores and sell off hydro-electric distribution. And somehow, this is expected to make billions for Ontario. While the expertise Clark’s panel brings to liquor sales might be questionable, the collective expertise of the panel in electricity distribution is likely non existent.
What we would really like to know about these recommendations is what criteria are used to determine if something should be a monopoly or a competitive business? Maybe others wonder what we gain in Ontario by keeping some businesses as a monopoly. And what would we gain by having our monopoly liquor stores catering to the wishes of their local markets? Would not competitive independent retailers do a far better job of meeting the market needs for ethnic liquors and wines?
And what fairy godmother advised the panel to suggest privatizing Ontario’s confused mess of monopoly power distribution systems? And why do we get the impression that Clark and friends have got it all backwards?
Would it not be more logical to retain as a monopoly something that is a logical monopoly? If power distribution has no competition, what is to be gained from privatizing it? Would you not just be licensing people to take money from the taxpayers for a service requirement that government can more fairly satisfy?
On the other side of the coin, why not privatize those businesses that would benefit from privatization? If the government could make more revenue, the taxpayers have more choices and Ontario entrepreneurs get to do their stuff, what the hell is the Ontario government’s problem?
And to advise the government to rip off more money from the beer monopoly to keep their monopoly is advice we would not accept from any banker. This banker is way out of his depth and he should quit now.
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Copyright 2014 © Peter Lowry
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