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March 6, 2012 - No. 26

Oppose Government's Ultimatum to Teachers

This Week in the Legislature

Discussion of the Drummond Report
What It Means to Be in "Everyone's Interests" - Dan Cerri
Hospitals Under Attack in Every Which Way - Doug Allan, Ontario Council of Hospital Unions/CUPE

Unprecedented Government Attack on Teachers

"Bankruptcy Expert" James Farley to Head Government Negotiating Team
Oppose False Choices to Justify Wrecking Public Education - Laura Chesnik
Teachers and School Support Staff Oppose Attempts to Tear Up Collective Agreements - Christine Nugent

Privatization of Hydro Infrastructure

Toronto Hydro Workers Say No to Job Cuts
McGuinty Opens Space for Brookfield Vultures - Jim Nugent
Example of Northern Ontario Confirms Anti-Social Impact of Privatization

This Week in the Legislature

This past week in the legislature included debates on Bill 11, An Act respecting the continuation and establishment of development funds in order to promote regional economic development in eastern and southwestern Ontario. It is an integral part of the Liberal's plan to attract and support business in different areas of the province.

Debates about the bill included discussion on the handout of money to the monopolies without guarantees. On Thursday, March 1, Taras Natyshak, MPP for Essex, said:

"What we're saying is, give us some job guarantees. Provide the mechanisms, within the context of this bill, to have the checks and balances so that we don't get into another scenario such as the one that played out in Chatham, with Navistar, where they left that region, that community -- 1,100 jobs -- bags of money in hand, and the community at a tremendous loss."

MPP Theresa Armstrong (London-Fanshawe) spoke of the concerns in her riding with the shutdown of the Caterpillar plant. She said:

"When I look at Bill 11, the Attracting Investment and Creating Jobs Act, it really makes me think that I don't want the example I have in my riding to happen again. This government needs to learn that when we give funds to companies, there have to be strings attached to those jobs."

Other debate about the bill expressed concern over the relatively small amount ($20 million) and that the program is being funded with a reallocation of funds, not with any new money.

The debates in the legislature demonstrate that the political system itself comes under the dictate of monopoly right. The discourse is that there is no alternative, that Ontario must invest in the monopolies to attract businesses and jobs, and that the job of the legislature is to simply debate the details of these investments. In this situation, it is not realistic to try to hold politicians' feet to the fire. The issue is sovereignty and the right to decision-making. Workers and people in Ontario have the right to determine for themselves, in coordination with the political system, how the economy should be organized. This requires a renewal of the economic and political systems.

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Discussion of the Drummond Report

What It Means to Be in "Everyone's Interests"

The more the Drummond Report is analyzed, the more it reveals how the rich and their political representatives are trying to convince the working class in Ontario that their interests are the same. It is part of the attempt of the rich and their political representatives to resolve the crises in the economic and political systems in their favour.

In his message to the Government of Ontario, Drummond writes: "A wide-ranging reform effort will reinforce the notion that we are all in this together, that all Ontarians can support the reforms because they will benefit in the end from these changes." Drummond's message is a particular example of the rich trying to resolve their crisis by presenting the interests of the rich as being the same as workers' interests. It is typical of ruling class thinking to present society as if it were free from class interests.

McGuinty is presenting his own brand of "everyone's interests" by playing the pragmatist. He says that the recommendations of the Drummond Report need to be chosen and implemented wisely through pre-budget consultations in the legislature and with the people of Ontario. He portrays himself as being different from PC Leader Tim Hudak who wants all of the recommendations implemented immediately. In this way, McGuinty presents himself as looking out for the interests of all Ontarians, not just monopoly interests.

Despite all of the rhetoric, the reality is that at the same time, McGuinty is trying to implement the main purpose of the Drummond Report, which is to carry on the anti-social offensive, while attempting to preserve the appearance of legitimacy of the system, in general, and of his power, in particular. If McGuinty is successful, he will be seen by the electorate to be looking out for the greater good by not giving into all of the recommendations, but at the same time he will deliver the agenda of the rich.

Workers and their allies must pay attention to how McGuinty will implement the Drummond Report. It must not pass! The workers and people of Ontario do not share the same interests as the rich and their political representatives. They must look at ways of resolving the crises in the economic and political systems in their favour.

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Hospitals Under Attack in Every Which Way

The implications of the Drummond Commission recommendations for the public health care system in Ontario are discussed in an article by Doug Allan of the Ontario Council of Hospital Unions/CUPE, entitled "Hospitals Under Attack in Every Which Way." It was published on the Ontario Council of Hospital Unions/CUPE blog "Leftwords: Defending Public Healthcare." Posted below are extracts.


The Drummond Commission into the reform of public services in Ontario has proposed the province shrink and privatize hospital services.

Funding: Drummond has recommended that health care funding be limited to 2.5 per cent until 2017-18. This is considerably less than the 3.6 per cent increase proposed by the Liberals not long before the election, a drastic reduction in health care funding increases, which have averaged 7 per cent since the Liberals came to power eight years ago. [prior to the election the Auditor General estimated that for McGuinty to realize his election promise to limit health care spending would amount to $1 billion and require extending the hospital wage freeze an additional two years -- OPF Editor's Note.]

Hospitals: The main target for Drummond cuts in health care spending is hospitals. Diverting patients from hospitals is central. [...T]he funding the Drummond Commission proposes is not adequate to strengthen non-hospital services -- quite the contrary. Replacing hospital services by home and community care is not a new policy -- it has been government policy for decades [resulting in] thousands of hospital bed cuts, dangerously high hospital bed occupancy levels, cancelled surgeries, backed up emergency rooms, EMS "code zeroes" (which occur when no ambulances are available for emergency 911 due to delays at overcrowded ERs), and a privatized home care system which has been in crisis for years. There are now 24,000 people on waiting lists for long term care services and 10,000 people on waiting lists for home care services.

Restructuring: Drummond suggests more amalgamations and more specialization by hospitals. In effect, hospital services would be moved from local communities to more distant, centralized locations. [P]art of the rationale is to introduce fee-for-service funding for more hospital procedures and force hospitals to compete to provide services. Services will be moved out of local hospitals into those that provide larger volumes for lower prices. Hospitals will specialize so they would no longer provide such a range of services and patients would have to travel to different hospitals or private clinics to get different services.

Hospitals as acute care providers only: ...The Commission recommends: "Divert all patients not requiring acute care from hospitals and into a more appropriate form of care that will be less expensive ..." There are thousands of hospital beds that are not acute care -- providing rehabilitation services, complex continuing care, mental health care, restorative care, and long term care. There are also millions of hospital procedures provided to non-acute patients in outpatient clinics. Removing these services from hospitals would have a very serious impact on hospital services and jobs.

Privatization: Drummond recommends health care privatization [and] also proposes the introduction of contracting for hospitals services. Home care compulsory contracting has led to low wages, high staff turnover, and breaks in the continuity of patient care.

Private, for profit clinics providing surgeries and other hospitals services through fee for service funding is one privatization initiative Drummond especially prefers.

Arbitration: The Commission attacks the interest arbitration system used to settle collective bargain disputes in essential service industries (such as hospitals). ... For the interest arbitration system to work, arbitrators must be acceptable to both parties, which is why arbitration has traditionally rested on a consensual basis, with the arbitrator chosen by the parties themselves in the majority of cases.

[...] The Commission would replace this system with one where an "independent tribunal or commission" would establish and manage a roster or a panel of arbitrators who would be assigned to cases without any input by the parties affected.

Other Commission recommendations:

- Where feasible, services should be shifted to lower-cost caregivers
- Increase the use of personal support workers
- Plans that extend out-of-hospital services such as those for outpatients should not be entertained
- Resist the natural temptation to build many more long-term care facilities
- Establish incentives to discourage Family Health Teams from referring patients to acute care
- Put to tender more service delivery
- Reduce Ontario Drug Benefits for seniors
- Do not let concerns about successor rights stop amalgamations that make sense and are critical to successful reform. Successor rights as currently defined do not necessarily limit the right of the government [...] Inherited agreements do not live forever; provisions can be accepted initially and bargained differently when they come up. [...]

Complete article available at http://ochuleftwords.blogspot.com/2012/02/hospitals-under-attack-in-every-which.html

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Unprecedented Government Attack on Teachers

"Bankruptcy Expert"  James Farley to Head
Government Negotiating Team

Banner from the time of Stelco's bankruptcy fraud, denouncing then-Justice Farley's treacherous role in the affair.

The provincial government has appointed former Justice James Farley to spearhead the implementation of its agenda of forcing concessions from teachers in their upcoming contract negotiations. The current collective agreements between teachers and school boards across the province expire on August 31.

James Farley is Senior Counsel with McCarthy Tétrault, a law firm that specializes in providing legal advice to corporate clients in bankruptcy and restructuring cases. Before joining McCarthy Tétrault in 2006, James Farley was an Ontario Superior Court Justice. It was Justice Farley who presided over the Stelco bankruptcy proceedings which, amongst other things, were used to try and force Local 1005 USW in Hamilton to open its contract and make concessions to Stelco.

Local 1005 refused to make concessions and fought to expose what Stelco was up to. Stelco was far from broke -- steel prices were up and its order books were full throughout the bankruptcy restructuring. Yet Steclo's suppliers, unsecured creditors and common shareholders were shafted. Secured creditors came out okay and a few hucksters made the big score. Because of Local 1005's resistance to these schemes, Stelco's CCAA bankruptcy protection was thoroughly exposed as a fraud and Justice Farley earned notoriety for his role in overseeing and giving his judicial seal of approval to the whole sordid affair.

The provincial government recruited this "expert" in "bankruptcy restructuring" to try and overwhelm teachers in these contract negotiations.

The government has also unleashed a media offensive to paint teachers' remuneration as over the top, unsustainable and a drain on society. Finance Minister Dwight Duncan for example said the government has "no choice" but to bring down teachers wages and working conditions. "You simply cannot get at this deficit without significant savings achieved in the wages and benefits... in the public and broader public sectors."

Teachers should not accept that there is "no choice" but to embrace concessions and cuts to government funding of necessary social programs in order to create a favourable "investment climate" in the hope that at some undetermined point in the future it will lead to prosperity. This is not an option! What will be the outcome for education in Ontario if teaching conditions are driven down? Teachers working conditions are the learning conditions for the youth of our society. By fighting for their rights and for the education our youth deserve, Ontario teachers will show that far from there being "no choice," human-centred solutions to this crisis are both necessary and possible.

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Oppose False Choices to Justify
Wrecking Public Education

Providing a high-quality public education system goes hand in hand with building a modern, innovative and forward-looking society. This is why teachers, support staff, administrators, trustees, parents and students across Ontario are concerned about what the McGuinty government is up to. The recommendations in the Drummond Report, as well as the appointment of retired Justice James Farley to lead negotiations with education workers indicate that the McGuinty government is setting the stage for an assault on the public education system.

Many are rightfully angered by these developments. Before the Ontario election, McGuinty tried to paint Hudak as a disciple of Mike Harris, while he himself represented a "kinder, gentler" Ontario. Now, we can see that McGuinty is following the same direction as Harris: attack the wages and working conditions of those in the public sector by claiming that this is necessary to make the system "sustainable."

The millions McGuinty hopes to remove from public education through negotiations and new legislation will not go to benefit the students of Ontario, their families nor their communities. It will go into the nests of the international financial vultures represented by Don Drummond who hold Ontario's debt and deficit. A debt and deficit that was incurred by the McGuinty government and the Harris/Eves government before it, through pay-the-rich schemes. These schemes have handed billions of Ontario's social product to international monopolies operating in Ontario through "incentives," tax cuts, and various bailout schemes. These monopolies also hope that more underfunding of the public education system can be used to present privatization as a solution and thereby syphon more money out of the public treasury. This is already being done in the day care sector in various communities in Ontario for example.

Education workers are being bullied by the province and certain media outlets in order to try to get them to accept false choices to cover up what is really taking place. The bullying goes like this: accept bigger class sizes, fewer supports and cuts to your pensions, wages and benefits in order to help save the province from economic ruin. In this way we are being told to choose between: our well-being and that of our students; our communities; and the province. This is a false choice. Firstly, our well-being is inseparable from that of our students and our communities. Secondly, how can harming the well-being of the people of Ontario benefit the province? The condition for the well-being of the province is the well-being of its people, especially its youth. We in the education sector are at the forefront of proposing reforms to improve the quality and effectiveness of the education system; however, we won't accept false choices in order to impose an agenda that will harm our interests and those of our students and the communities in which we live.

Education workers do not accept that the public education system should be undermined so the economy can be used to keep paying the rich. Our experience with the McGuinty government shows that we should be our own saviours, rather than hoping this or that political party in the legislature will protect the education system everyone relies on. It is up to us, alongside the other workers in Ontario and everyone else who can be won over, to do it ourselves.

* Laura Chesnik is an elementary teacher in Windsor, Ontario.

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Teachers and School Support Staff Oppose
Attempts to Tear Up Collective Agreements

The Ontario government has launched an outrageous attack on the entire public education system, taken measures to deny the education workers their rights to have a say in their livelihoods and have dictated a reduction in their real wages and benefits.

The government of Ontario has outlined a timetable for the Ontario elementary and secondary teachers and support staff for a Provincial Discussion Table (PDT). The aim is to provide a framework for the settlement of collective agreements for this round of bargaining. The opposite is taking place.

At a February 21 teleconference between Premier McGuinty, Education Minister Laurel Broten and the teachers' organizations, it was made clear that communications would be one-way with no opportunity for the teachers to even ask questions.

On February 22 the government's parameters for the 2012 PDT were released and as identified on the ETFO website they included

1. A two-year term for the next collective agreement with a zero per cent salary increase in each year.

2. Retirement gratuities to be frozen as of August 31, 2012 from both a sick leave bank and salary perspective. All accumulated sick leave not used to calculate this frozen gratuity would be forfeited. No more sick leave banks. Each teacher to receive six days per year at 100 per cent salary and 24 weeks at two-thirds salary, not accumulated or carried forward.

3. A 2012 valuation of the pension plan with a view to not increasing the government's level of contribution. The result of this would be that the benefits of the pension would have to absorb all necessary funding top-up obligations.

4. All teachers currently working their way either up or across the salary grid to be frozen in place for two years with no future adjustments to recognize the missed steps.

5. Restructure salary grids.

To date, two of the teachers' organizations have responded.

The Ontario Secondary School Teachers' Federation (OSSTF/FEESO) stated:

"This is an unprecedented attack on both collective agreements and the collective bargaining process. During the one hour, time-limited meeting, the government representatives could not provide answers to questions about process, timing and impact of the proposals tabled... OSSTF/FEESO may be required to take action to defend our collective agreement provisions and our collective bargaining rights."

The Elementary Teachers' Federation of Ontario (ETFO) said:

"We were told that the government was interested in settling these matters before mid-March. To say we were insulted is an understatement. We posed several questions about process that the government team was unable or unwilling to answer. ETFO was invited back to discuss this document on March 5 and 6. We find the tone and, most significantly, the content of the government's parameters to be offensive to all ETFO members and cannot be a party to what amounts to deep and mean-spirited strips to our collective agreements that would negatively affect every member at every stage of their career. The PDT is not part of the Ontario Labour Relations Act to negotiate a collective agreement with each school board."

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Privatization of Hydro Infrastructure

Toronto Hydro Workers Say No to Job Cuts

On February 27, hundreds of Toronto Hydro workers demonstrated against job cuts at the headquarters of Toronto Hydro. Toronto Hydro is the City of Toronto-owned electrical power distribution company. Workers were protesting against the electrical utility's plan to cut its 1,700 person workforce by 20 per cent. The electrical utility workers' demand is: No Downsizing of Toronto Hydro!

Toronto Hydro has already cut 60 non-union jobs. Four hundred and fifty unionized workers were offered early retirement and buyout packages, which were accepted by 130 workers. There are still about 170 unionized workers under threat of layoff. Hydro workers have rejected the need for any job reductions since the utility has more work than it can handle. Cuts, the workers say, will overload the remaining workers and put maintaining the electrical service in jeopardy.

Toronto Hydro workers are represented by CUPE Local 1. The local president John Camilleri said at the rally, "There should be absolutely no downsizing of workers. There's no shortage of work. In fact, there's a growing backlog of maintenance work to be done. If layoffs occur, they will not only hurt the workers but would seriously damage Toronto's publicly-owned utility."

If there was a layoff, it would affect younger workers the most, including some clerical workers, call centre workers, system support workers and 100 power line technician apprentices recently hired for the capital and maintenances projects currently underway. The current round of job cutting at Toronto Hydro follows its decision in early February to end the contracts of trades contractors working on capital and maintenance projects. It is estimated that terminating these contract will eliminate 700-1,000 jobs.

Toronto Hydro says that the job cuts are necessary because the Ontario Energy Board (OEB) turned down a request for an increase in the rates Toronto Hydro can charge residents and businesses in Toronto. Rates charged by local distribution utilities are regulated by the OEB. The utility had requested rate increases to cover capital and capital maintenance costs previously approved by the OEB. The OEB told the utility to look for internal "efficiencies" before any increase would be considered.

In a statement released after the OEB decision on January 5, Toronto Hydro said, "Toronto Hydro's capital spending in 2011 totalled $378 million. Today, the OEB has cut the capital budget by approximately 65 per cent. This has far reaching ramifications that will impact not only customer service, safety and reliability, but employees within the utility and other industries and suppliers. Further, with this decision, the asset replacement cycle has been changed to approximately 97 years from the previously OEB-approved 30 years."

In response to the OEB's advice about finding internal efficiencies, the Toronto Hydro said it "has made significant productivity improvements. The utility currently operates with 35 per cent fewer employees than were in place prior to the amalgamation of the former metropolitan Toronto electricity utilities."

Although Toronto Hydro's only shareholder is the City of Toronto, it is set up as a corporate entity, with a highly paid CEO and the holders of its $1.2 billion debt enjoying interest payments of $75 million a year. As such, it has the capital-centred approach to any problem: squeeze workers and squeeze service rate payers. But several other powerful interests with the same approach are in play in connection with Toronto's electrical service. They have competing claims on the immense value added to the electrical service every year by Toronto Hydro workers and on the $2.6 billion a year revenue stream extracted from electricity ratepayers.

The construction and real estate industries, for example, demand both electrical servicing for $14 billion a year in new construction and super service maintenance levels on high rent areas like the downtown core. Other interests are pushing for further privatization, as in 2008 when Toronto Hydro's profitable telecommunications unit was chipped off and sold to Cogeco. Rob Ford's gang is pushing for selling off the city's shares in Toronto Hydro as part of his campaign to "sell everything not nailed down."

The biggest claim though is made by the Ontario government. The OEB directs $2.06 billion of the revenue Toronto Hydro collects from ratepayers into the warren of highly privatized power generation, distribution, marketing and financing enterprises set up by the Harris government when it busted up Ontario Hydro. This practice has continued to the present McGuinty government. The OEB also makes sure Toronto Hydro ratepayers pay their "fair share" of the McGuinty government's green energy fraud. An outrageous example is McGuinty's $6.5 billion handout to Samsung. This secret deal was never approved by any regulating body, but the OEB dutifully passes it on to local utility ratepayers.

Other special levies and taxes are imposed directly on the utility by the province, such as the annual "payment in lieu of taxes" Toronto Hydro is forced to pay into the Ontario Hydro stranded debt fund. In 2010 Toronto Hydro was forced to pay $25.6 million of its net revenue to this fund, in addition to the stranded debt charges it collected from ratepayers. The OEB pretended to be protecting ratepayers when it denied Toronto Hydro's recent rate increase request. But with one-fifth of Ontario's energy revenue coming from Toronto utility ratepayers, the OEB was just making sure there is more available for McGuinty to squeeze from Toronto electricity users.

It is difficult to sort out the issues at Toronto Hydro with so much spin coming from the different powerful players and their respective media supporters, which marginalizes utility workers and utility ratepayers as if pawns on a chessboard. It is suggested, for example, that Toronto Hydro management is using job cuts and cancellation of trades contracts as a gambit to put pressure on OEB. But there can't be any doubt about the justness and veracity of the stand that the electrical utility workers have taken against the job cuts and in defence of the services they deliver.

The information workers are providing about the threat to the viability of the system if the work is not done is entirely reliable. It is confirmed by the high frequency of service disruptions and the number of utility vault fires and other major dangerous incidents. The backlog of maintenance and equipment renewal is also a matter of record. The depreciation of distribution line assets, for example, has reached the point where a dollar spent on distribution line assets results in only a forty cent net increase in assets -- assets are depreciating faster than they can be replaced.

Utility workers have a right to a livelihood at Canadian standards for the work they do. There is necessary work for them to do and there should be no job cuts. Electrical utility rates are a heavy and growing burden on the backs of other working people, but electrical utility workers earning standard Canadian wages and having job security are not the cause of this burden. The claim by the OEB that Toronto Hydro has an "efficiency" problem is just a self-serving attempt by the provincial government to inflame service users against workers providing electrical services.

There are egregious examples of Toronto Hydro's management using their executive privilege to siphon a few millions of dollars out of the utility every year and scores need to be settled for this arrogant use of privilege. But the cause of job insecurity, high electrical rates and system viability at Toronto Hydro is on a completely different scale. Billions of dollars are siphoned out of Toronto Hydro and other municipal electrical utilities every year by the McGuinty government to fund its privatization and other pay-the-rich schemes in the electrical sector.

Finding the political means to hold McGuinty and other bankrupt politicians to account for this is the task facing working people, including those who make their livelihoods providing electrical services and those who rely on and pay for these services. Support by all of Toronto's working people for the resistance of Toronto Hydro workers to job cuts is a starting point to finding a way forward.

(Photos: CUPE Ontario)

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McGuinty Opens Space for Brookfield Vultures

The Ontario Energy Board (OEB) is currently considering proposals submitted in response to a call from the Minister of Energy and Infrastructure for the construction of a 230kV double circuit power transmission line from Thunder Bay to Wawa (near Sault Ste. Marie) with continuous carrying capacity of 466 MVA. The project is known as the East-West Tie (EWT). The proposals being considered are for development, construction, ownership, operation and maintenance of the EWT.

The privatization rules established by the Harris government's Electricity Act, 1998 and kept in place by the McGuinty government require the OEB to consider contract proposals from private sector companies competing with Hydro One, which owns and operates 98 per cent of Ontario's grid. Seven international consortiums are scrambling to get their hands on this lucrative contract. They are competing not only for the sake of the guaranteed profits from this deal, but also to be dominant players in the game for the multi-billion dollar deals available across Ontario's electricity sector.

The estimated cost of the EWT project is $600 million, part of the McGuinty government's $9 billion plan for increasing and refurbishing the power distribution system up to 2030. These costs will be paid by electricity ratepayers throughout Ontario as distribution fees added to their electric bill. The OEB sets these fees and guarantees the return on investment to the transmission line financiers, designers, builders and operators.

The EWT will join the electrical grid in north western Ontario to the grid in the north east. The EWT will also provide increased grid capacity for power generated in the region to be inputted to the grid. Since the grid is currently operating at capacity, increasing transmission capacity and connectivity will facilitate bringing on line new hydro and other renewable energy projects planned for the region. It will also facilitate the schemes of international monopolies that capture hydro power plants by purchasing paper mills, saw mills, and other enterprises for the purpose of selling the hydro power.

Throughout Canada monopolies frequently purchase mills and smelters having their own hydro power plants with the intention of shutting down production and selling the hydro power to the grid. These moves usually also involve bankruptcy frauds to loot pension/benefit plans of the mill or smelter workers and often destroy one-industry towns. High prices for electricity are the incentive for this and in Ontario, the premium prices paid for selling renewable energy (including hydro) to the grid are added incentive for wrecking mills and smelters.

According to press from Thunder Bay, the likely winner of the EWT contract will be a consortium with three partners, known as East-West Limited Partners (EWT LP). One of the partners is a company owned by six First Nations on whose land the project will be built. The other two are Hydro One, which will build and operate the project and Brookfield Asset Management which will provide financing.

Fraser paper retirees protest outside Brookfield's offices in Gatineau, Quebec, January 15, 2010.

Brookfield is an aggressive international monopoly based in Toronto and New York. It is notorious amongst Canadian workers for its wrecking of productive enterprises, causing job losses and looting workers' pension plans. Brookfield was instrumental in wrecking Stelco and handing this national treasure over to U.S. Steel. It has specialized in shuttering paper mills and saw mills in the Maritimes, in Quebec and across the country to steal the power from the hydro plants connected to the mills and helping finance their big scores by looting pension plans of the workers they throw on the street.

Now Brookfield is expanding rapidly into the Ontario public hydro sector to occupy the private sector space created by Harris and McGuinty. Linking up with Hydro One on the EWT power distribution project will serve Brookfield's strategy of becoming a dominant global force in renewable power generation. A week before the bid for the EWT project was submitted, Brookfield consolidated all of its electricity holdings into one company, Brookfield Renewable Energy Partners, to prepare for competing in Canadian and global markets.

The consolidated company will have assets of $13 billion. Eighty-six per cent of those assets are in hydro power, with 197 hydro power facilities in Canada, the U.S. and Brazil. Press reports on the consolidation quote Brookfield as saying that now it would not be limited to buying a hydro dam here or there, but can use this pool of assets to leverage enough financing to buy whole electrical systems.

The prospectus Brookfield issued to the financial oligarchy on its recent consolidation describes what a great deal the guaranteed profits from privatized hydro power is:

"Brookfield Renewable Energy Partners (BREP) will have highly stable, predictable cash flow sourced from a diversified portfolio of low operating cost, long-life hydroelectric and wind power assets that sell electricity under long-term, fixed price contracts with creditworthy counterparties. Virtually all of BREP's generation output will be sold pursuant to power purchase agreements to public power authorities, load-serving utilities, and industrial users or to Brookfield or its affiliates. The power purchase agreements for BREP's assets will have a weighted average remaining duration of 24 years, providing long-term cash flow stability."

Brookfield is promising the oligarchs guaranteed cash-for-life from privatized electrical services. But this tribute handed over to the international financiers has to be taken somehow from the electrical power generation, distribution and marketing system. It can only come from the workers producing the services and fees on the service users. When the tribute is squeezed from the workers and service users, it disappears forever from the economy.

The McGuinty government has an electricity capital plan of $45 billion for 2010-2030 underway and is using a high level of private sector partnerships. The recent report on reform of Ontario's public sector by privatization ideologue Don Drummond pointed to the EWT LP consortium and the EWT project as an example of how these partnerships should be set up. But Harris, McGuinty and Drummond are taking Ontario in the wrong direction with their privatization schemes. They increase the claims on Ontario's wealth by the international financial oligarchy, driving down Canadian living standards and weakening the economy.

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Example of Northern Ontario Confirms
Anti-Social Impact of Privatization

The anti-social offensive has already seen various public assets taken out of public control and handed over to private interests. All of this has allegedly been done on the basis of efficiency and other high ideals supposedly in the public interest.

Far from any benefit to the people, prior examples of privatization show precisely the opposite, that these changes are at the public expense to benefit the narrow interests of rich. Take the example of privatization in Northern Ontario. In a February 25 Letter to the Editor of the northwestern Ontario newspaper the Chronicle Journal, Paul Filteau, points out the negative consequences of privatization on the region. This is his conclusion despite being a former consulting partner in privatization of government services. He writes:

"Before we leap into further privatization of government services we should first examine the results of those already privatized from a Northern Ontario perspective. E.g., tourism signage, snow plowing, hydro generation and transmission and medical transport, to name a few.

"Ironically, these contracts actually foster monopoly and oligopoly rather than competition since they are for fixed periods and with one company that usually dominates the service area.

"Some of the questions that might be asked: does privatization actually save money; do we maintain local employment and control of these services; does privatization maintain fair wages; is the local level of service maintained or improved?"

To illustrate his point, Filteau notes how in British Columbia, snow plowing and other highway maintenance is done through local district maintenance corporations, thus retaining local expertise and revenues to develop the local economy and infrastructure. He also points out that with privatization the remuneration means those few at the top get a lot while employees' wages, taking money out of the local economy. He also cites corruption, by the CEO at Hydro One in 2002 and now the ORNGE air ambulance service, as another negative outcome of privatization.

Filteau further notes that, "Here, in Northern Ontario I understand control of much of this work has gone off shore (Switzerland and Great Britain). One can only wonder, since it is us who does the work locally, why are the profits going elsewhere?

"Presently, hydro transmission is being upgraded and expanded with a new 230,000-kilovolt tie line between Thunder Bay and Wawa. This work will likely go to private-public consortiums of local and Toronto interests such as Brookfield Power. While it's good the First Nations are part of these agreements, we should question who is getting most of the benefit, here or Toronto? After all, it is our power."

Filteau adds that, under the North American Free Trade Agreement, once a public service if privatized, it can't be returned to the public sector and also opens the market up to bidding by U.S. companies.

This is to say nothing of what is being planned in the Comprehensive Economic and Trade Agreement between Canada and the European Union, which will greatly exacerbate the nation-wrecking of existing neoliberal trade agreements.

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