Tuesday, May 11, 2010

A National Financial Regulatory System...not in Canada!

Canada's Finance Minister, appearing on CBC's Power and Politics, seemed smug when asked about a tax on the banking system. After all, there was no financial meltdown in this country, so why should there be a tax on the banks, so that they would pay for such an event, should it ever occur.
Flaherty is advocating a lump sum supplied by the banks, so that the taxpayer will not be responsible should there be a Canadian bank failure.
As the single most fortunate country in the G-20, suffering the least fall-out from the Wall Street meltdown, Canada may have dodged a bullet this time. However, most economic analysts agree that there are loopholes in the regulatory system, which Flaherty says he is going to plug, on a voluntary basis.
Quebec and Alberta, however, are objecting to a national regulatory system for the financial sector. How surprising! With regulatory systems in each province, money seeking to invest in this country is frightened off by our balkanized regulatory system.
And Flaherty is proposing a voluntary, national regulatory system to which each province may join. Note the word "may"...not "must" but "may"!
I must be mistaken, but I thought a country, in order to be a country, might actually like to function more as a common entity, with common health standards, and common and portable pensions, common educational standards, a national currency, a national post office a national military and even a national foreign policy. And that a national regulatory system for financial management might actually enhance the economic prospects of the country in an increasingly "global" economy.
Could Canada then not speak to potential "foreign" investors with one voice, offering the richness of our human and natural resources, with one set of rules for their participation?
What "freedom" would a provincial government give up, to achieve such a state? And what benefits would trump that "loss"?

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