As Blaze pointed out on Sandbox, and as I don’t at the moment see elsewhere here on Brock, the House of Commons Finance Committee met today from 3:30 through 5:30 today. Most of the second half of the meeting was taken up by the FATCA IGA, with questions of Finance officials (Shoom and Ernewein) mainly by the NDP, with softball lobs by Conservative members.
I’ll repeat here the comment I posted on Sandbox. I’m not going to subscribe to or respond to any replies to this; I just want to call everyone’s attention to the meeting, how to download a video clip of the entire meeting, and how important it is for Canadians affected by the IGA to watch, listen carefully, and reflect carefully.
I was able to download the two-hour video clip of this meeting at this web link
May 1 Finance Committee meeting
It isn’t quite obvious, but at this link directly under the General Information tab slightly down the page, there is a little link named “Play, Download or Subscribe.” If you click on that, a box pops up which lets you download an audio clip, a medium-res video clip or a high-res video clip in English or French, of the entire meeting. You can also view it on screen without downloading, but I recommend downloading to your desktop and then double-clicking the file once downloaded; in Windows, Windows Media Player will launch the clip. The FATCA (“Part 5”) discussion begins at 1 hour 5 minutes into the meeting (slightly more than halfway through) with Ernewein and Shoom as Finance witnesses (the former did most of the talking). The remainder of the meeting focused on FATCA. The meeting adjourned until, if I understood correctly, next Tuesday when the committee will reconvene with the Minister of Finance for an hour and then a resumption of questions on Part 5 (FATCA IGA) and then eventually some issues in Part 6 of the omnibus bill.
I think it is important to pay attention to this video, because it makes very clear how the government will reply, both in Parliament and I suspect in court if it comes to that, regarding the privacy and charter issues. The NDP pressed these issues very persistently, but the Conservative and Finance spokespersons responded in a way that gave me an inkling of some of the reservations that I suspect Joe Arvay may have raised in his legal opinion about how this might unfold. I’m not convinced the charter issue is going to be a slam dunk; it certainly is going to be an intricate and prolonged debate.
I won’t presume to summarize what was said, everyone can view the video and draw their own conclusions. Listen carefully to what is said, and how it is said, in particular in contemplating how you want to proceed for yourself and your family if you’re an affected so-called US person.
Also note that the Finance spokespeople made it very clear (once again) that CRA is NOT going to be collecting IRS penalties or tax liabilities against Canadian citizens. They made it VERY clear however that Canadian residents who are US citizens and who are not Canadian citizens may very well be collected against as a result of information provided under the IGA, if the IRS comes back to CRA with claims against them for specific tax liabilities (not penalties however).
I think all affected persons need to pay attention to the video I link above, and reflect carefully on what is said in it. Also it’s important to tune into the committee’s next meeting, which I THINK the chair said is next Tuesday, though it’s not on the meeting schedule yet.
@WhiteKat
Typical “might is right” attitude we would expect from someone with that handle. I’m no economist so I can’t respond to his comments, but his efforts to poo-poo your comment (which is great by the way) is along the lines of “Erika from Amerika’s” attitude that Canada only exists by the grace of America. It is said that pride comes before a fall. You don’t hear any chants of “we’re #2” from down there do you?
@WhiteKat,
I guess the arrogance, entitlement and hypocrisy in the US is not limited to their congressmen. One of the things this proud American does not realize is that FATCA exists solely because his family, friends and neighbours are tax cheats. And he’s laughing at us?
@Bubblebustin, you took the words out of my mouth literally, as I responded to him with ‘might makes right’ in today’s post. Most people do not go back and look at older posts, so I referenced his comment and commented back in today’s post to keep the discussion going. I get a lot of ‘get lost’ comments over there, but at least FATCA is related to GT’s investment blog, albeit indirectly to some of his posts. So many people there comment about the craziest things having nothing to do with investing and do not get told to get lost. I think I hit a nerve with some of the readers (bankers, investors) who do not want to see any hassle with FATCA implementation.
@WhatAmI, yeah, I know…arrogant jerk. And Americans wonder why so many people do not like them (and thus our own government does not like us much either!)
Actually, I retract what I just posted. According to the president and the director of the IRS, FATCA exists because “Wealthy people who unlawfully hide their money offshore aren’t paying the taxes they owe, while schoolteachers, firefighters and other ordinary citizens who play by the rules are forced to pick up the slack”.
http://www.irs.gov/uac/Prepared-Remarks-of-IRS-Commissioner-Doug-Shulman-to-the-Leaders-&-Legends-Series,-Johns-Hopkins-Carey-Business-School,-Baltimore
@Bubblebustin,
I’m not an economist either. I stole the part about Exon from a comment Petros made somewhere on Brock. I didn’t think he would mind. 🙂 I have no idea how to respond back to TheAmerican re: his contention to that particular point…lol.
@WhiteKat
They’re playing us a symphony of the world’s smallest violins (while Rome burns).
@WhiteKat
“If you ask five economists a question, you’ll get six answers” anyway.
@ Schubert
“The NDP clearly has given the IGA priority in their analysis and attack of the omnibus bill. They deserve credit and thanks for this. I urge you to write to them and thank them; I think it’s important to recognize and thank politicians when they (or some of them) actually do the right thing.”
Absolutely agree. Positive reinforcement. I sent an e-mail to Mr. Mulcair and ALL the NDP MPs yesterday with a clear “Thank You” in the subject line.
@All
At the risk of blowing my own horn (aw, what the hell), for those of you who are in touch with MPs opposing the FATCA IGA, please do send them this:
http://www.thestar.com/opinion/commentary/2014/03/03/enforce_canadian_law_not_fatca.html
It’s important to rub the Government’s nose in the the fact that They. Are. Lying. To. The. Canadian. People.
No matter how damaging the impact of FATCA on individuals, the Tories can (and do) hide behind the excuse that “we had no choice, otherwise Canadian institutions face the 30% withholding. We negotiated the best deal we could.” The implication: the damaging impact on individuals is unavoidable. It’s like an act of nature.
THEY WOULDN’T BE TELLING THESE LIES IF THEY DIDN’T THINK IT MATTERED.
Relevant questions (with the standard excuses), which are [debunked at the link above]:
1. What did the Government do to fight FATCA? (Excuse: We Lobbied the Americans against it.) [In fact, they did nothing, cf. money spent lobbying on Canadian energy. Why is this less important?]
2. What does Canada get from the IGA? (Excuse: We protected Canadians’ privacy rights, Canada gets reciprocal financial information from the US.) [In fact, the IGA is specifically for the purpose of abrogating Canadians’ rights, Canada gets nothing from the IGA it doesn’t get now.]
3. Why did you surrender Canada’s sovereignty to foreign demands instead of fighting? (Excuse: We had no choice, FATCA is here to stay.) [In fact, FATCA’s under increasing fire down in the US. There are any number of legal challenges, WTO actions, and reprisals the Government didn’t even consider. If Canada rejected FATCA it likely would collapse globally.]
4. Why the secrecy about this sellout, trying to slide it through in Finance Bill? (Excuse: We fully consulted with the Canadian public.) [In fact, they colluded in private with selected elements of the financial and compliance industries against Canadian citizens and consumers.)
@Jim Jatras,
It enrages us to no end when a Canadian politician refers to Canadian citizens as “Americans living in Canada” Grrrrrrr. I want to scream we are Canadians living in Canada you dumb ass!
I have a question for you. I have read of rich Americans who have bought land in Canada and other safe countries because they fear a collapse in the US as well as civil unrest. Is there really a large group of “Rich Americans living in Canada?” Is that the reason we middle class are being persecuted? Because we live in the same country that some billionaires may be choosing to escape to because they fear for their lives in the US?
@ James Jatras
You should blow your horn. Can’t thank you enough for helping us from the other side of the border. And I will toot off some e-mails placing a spotlight on your Star performance. I can’t abide the devil-made-me-do-it argument either. We have an English AND American word that would have been most appropriate for this FATCA diktat — NO!
Is this the extent to how hard the Canadian government tried?
http://www.johnweston.ca/?p=6213
@WhiteKat:
Answer to your comment:
“At #14: WhiteKat, your “theory” is well and all, but one little detail you forgot when evaluating all sides… The U.S. holds the pursestrings. Canada does not by any stretch of the imagination. US Economy is easily 10X that of Canada’s, and the USD is still and will remain the global reserve currency. There will be absolutely no backfire against the likes of Exxon or Pepsi Cola. Mark these words. LMAO. Such a narrow minded viewpoint. If Canada didn’t sing FACTA IGA with the U.S. then it would be CANADA in a world of hurt… not the other way around. My oh my, what are they teaching you up there? Canada’s self importance is laughable in this scenario.”
With McCain and Levin encouraging the attack dog at IRS to impose FATCA and IGA withdrawal of ‘negotiations’ makes clear which Senators approve of the illegal implementation of FATCA anywhere. For them to sic the IRS attack dog on Russia by refusing to negotiate so they can impose the 30% withholding on Russias interests shows EXACTLY who and what they are. And the person commenting to you shows by his remarks he knows absolutely nothing about FATCA IGA and the REAL implication of it’s intrusion into the lives of those of other countries.
FAR from the US holding the purse strings, it is CHINA who holds the US purse strings and they have begun to call in their markers. From taking possession of VERY expensive NY real estate recently to more and more implementation of their ownership of property around the US they have just signed an agreement with Russia for form a union to use the Yuan and Ruble backed by gold for the sale of oil and gas.
THIS more than any other thing rings the death knell of the dollar as the “world reserve currency” . They have printed themselves into debt oblivion from which there is NO escape.
For Canada it is dire. For if FATCA and the horrid IGA our government intends to impose, complete with it’s third party snitches for the banks does not take down our financial house, the implosion of the US dollar surely will. For when the elephant falls the flea falls with it.
Rather than attaching ourselves to what the US has become with treaties and ‘agreements’ we would be wise to distance ourselves as far away as is humanly possible. NO to FATCA. Rein in the banks involvement in the US ( US banks will NEVER reciprocate. They are in no position to do so and are insolvent as we speak ( one of the main reasons for FATCA)
They are already imposing capital controls and questioning customers about THEIR money.
The attitude of this poster illustrates how arrogant and ignorant even those who suppose themselves financially literate can actually be when these issues come up.
The thing that worries me is that it is all too true that the states is 10X larger than we are. How do we cut the tie before the elephant falls into the abyss? The government of the day in Canada seem totally unaware of the dangers the out of control and criminal practices theUS admin present to our country and the world.
@bubblebustin, I think Flaherty did try very hard. I’m beginning to think his resignation wasn’t really a resignation. He may have been asked to resign because he fought too hard and the Americans hated him. Harper may have decided things were going to be worse if Flaherty didn’t step aside. We think Flaherty betrayed us but he may have been betrayed first by the Canadian government. His deputy also resigned about 2 weeks after he did. Harper brought in his own yes men.
If I was Flaherty I would’ve kicked up a fuss before resigning but then he probably wouldn’t have been able to get a lucrative job in the private sector which was his intention but unfortunately he passed away before that happened.
@Omg
I’m having cognitive dissonance as to why John Weston would post that letter. Is it to say, look Minister Flaherty really did try, so don’t be too hard on his memory? For Weston to put that up as a testimony to Flaherty – considering he threw us under the bus in the end, is just too WEIRD. Maybe Weston really believes that we got a better deal with the IGA than without. After all, he’s relied on the advice of his cronies in the US as to what was the best course of action to take.
I tend to agree with you, omg.
Of course Conservative MP Weston believes that Canada got a better deal with the IGA than without — that that was the only solution, collateral damage be damned. And, hey, let’s label those who will be collateral damage “Americans who happen to live in Canada” rather than the Canadians they too are. No one will know the friggin’ difference, especially as we can hide it in an omnibus bill. No one is paying attention — full speed ahead. Creativity for problem solving went out the window with all of the Conservatives toeing the Party line and they’ve learned to be robots obeying the master.
@Jim Jatras:
Great reinforcement of all we have been saying to our MPs and lately the Senate Finance Committee. May we send your post along as well as the link to the article. Perhaps coming from you it might make them sit up and take notice if these points are from one who is completely in the know regarding what is going on to repeal FATCA in the US rather than from ordinary middle class Canadians to whom they actually owe fealty!
And this is the kind of nonsense Canada Finance expects to be attached to via Canadian banking and support against law abiding and innocent Canadians and Permanent Residents.
“Updated, 9:03 p.m. | Bank of America disclosed on Monday that it had made a significant error in the way it calculates a crucial measure of its financial health, suffering another blow to its effort to shake its troubled history.
The mistake, which had gone undetected for several years, led the bank to report recently that it had $4 billion more capital than it actually had. After Bank of America reported its error to the Federal Reserve, the regulator required the bank to suspend a share buyback and a planned increase in its quarterly dividend.
While regulators still believe Bank of America has sufficient capital, the disclosure of the accounting error will most likely add fuel to the debate over whether the nation’s largest banks are too big and complicated to manage.
The error also raises questions about the quality of Bank of America’s own accounting employees, who are supposed to present an accurate financial picture of the bank’s sprawling operations to the public and regulators each quarter.”
@bubblebustin, John Weston probably feels guilty that it was Flaherty who fought the good fight but is taking all the heat when he’s not here to defend himself. He put that letter up to make himself feel better. It was all the other MPs including Weston who chose to betray us. They don’t feel guilty about that but they do feel guilty about their good friend being spoken ill of after he has passed away at a most inopportune time. His widow must be so sad that the one who fought hardest for us is the one taking all the flack when really it’s Harper who should be blamed more than anyone else.
@omgheestillanamerican
Re: “Is there really a large group of ‘Rich Americans living in Canada?’ Is that the reason we middle class are being persecuted? Because we live in the same country that some billionaires may be choosing to escape to because they fear for their lives in the US?” Of course not. FATCA is one size fits all, for every country in the world. Canada, for obvious reasons of proximity and links just happens to be the country where the human damage would be greatest.
@bubblebustin
Re “Is this the extent to how hard the Canadian government tried? http://www.johnweston.ca/?p=6213” Yup, p’rt’ much. I respectfully disagree with omgheestillanamerican that Flaherty tried. Hey, if no American paper would print the commentary, why not place it as an ad? Why a one-shot “effort” and not an effect one at that? If you want to change a political dynamic, you have to work at it and spend some money down here. You have to be prepared to tell Treasury “No,” and come up with Plan B of how to resist. Isn’t that what any self-respecting country does? There’s lots they could have done and STILL COULD DO other than capitulate to aggression. But the consulting firms (for their own benefit) told the banks this is the way to go, the banks told the government they “need” the IGA, the government spinelessly obliged. However Flaherty, or Stephen Harper, or CBA’s Terry Campbell or anyone else might have FELT about it, it’s what they did and ARE DOING that’s the scandal. The Treasury Department doesn’t need Ottawa to like FATCA, they just need them to obey.
@FuriousAC
Re “May we send your post along as well as the link to the article.” Please do!
I’ve sent Jim’s Star article along to both committees — House of Commons and the Senate. I don’t know if anyone would like to do the same but at the risk of committing a redundant act, because these have been posted by others elsewhere, here are all the e-mail addresses:
The House of Commons Standing Committee on Finance
Chair:james.rajotte@parl.gc.ca
Members:
murray.rankin.a1@parl.gc.ca; nathan.cullen@parl.gc.ca; scott.brison@parl.gc.ca; shelly.glover@parl.gc.ca; mark.adler@parl.gc.ca; cathy.mcleod@parl.gc.ca; guy.caron@parl.gc.ca; randy.hoback@parl.gc.ca; raymond.cote@parl.gc.ca; brian.jean@parl.gc.ca; dave.vankesteren@parl.gc.ca
Chair:
james.rajotte@parl.gc.ca
Members:
scott.brison@parl.gc.ca; nathan.cullen@parl.gc.ca; Mark.Adler@parl.gc.ca; mike.allen@parl.gc.ca; Guy.Caron@parl.gc.ca; gerald.keddy@parl.gc.ca; Murray.Rankin@parl.gc.ca; andrew.saxton@parl.gc.ca; dave.vankesteren@parl.gc.ca
The Standing Senate Committee on National Finance
Chair:
joseph.day@sen.parl.gc.ca
Members:
joanne.buth@sen.parl.gc.ca; nicole.eaton@sen.parl.gc.ca; percy.mockler@sen.parl.gc.ca; larry.smith@sen.parl.gc.ca; catherine.callbeck@sen.parl.gc.ca; irving.gerstein@sen.parl.gc.ca; asha.seth@sen.parl.gc.ca; diane.bellemare@sen.parl.gc.ca; maria.chaput@sen.parl.gc.ca; celine.hervieux-payette@sen.parl.gc.ca
I hope the committee members aren’t getting too swamped but from listening to the meetings it does appear that they read their e-mail and I applaud them for that.
In my entire lifetime, I have never seen a government representative “fumble” for “smoke and mirrors” answers the way I saw today. They were trying to dodge the answers by carefully trying to pass the buck or snow us with bureaucratic answers. Just picture this… if CanadianCop pulled over a vehicle with possible violators , during questioning, they answered this way…. skirted around answers etc. I bet there would be an investigation which finally got to the bottom. This is what we witnessed here.
SORRY!! Posted this in the wrong thread earlier……I just watched the Finance Committee from Thursday. I will be writing and posting a huge reference to BE’s comments. The biggest one is that there are no Canadians in Canada. You are all DUALS and can be given back to your own country or “origin” for prosecution if you break one of their laws while living in Canada. This was made clear by his remark “the laws of Canada will MAKE SPACE for the IGA” Make space?? Does this mean when driving down the 401 speeding, I can just tell CanadianCop that our laws will make space for me to break the law?? What the hell is LAW anymore in Canada???
@schubert1975, thanks for the update.