Another bleak update for Postmedia, with a shark waiting to be leaped

It looks like Postmedia has moved into asset-strip mode, based on its latest quarterly report.

The results were dismal, as they have been every quarter since the corporation bought the newspapers of near-bankrupt Canwest in 2010. Revenues are down 11.3 per cent for the first six months of the fiscal year, about $42 million. Expenses were down 10.8 per cent, or $32 million.

Postmedia management appears to have no solutions. They are cutting expenses, but not fast enough to match falling revenues. At the same time, the cuts are reducing value for readers and advertisers, which leads to more revenue losses. It’s a relentless downward spiral.

Paul Godfrey

Earnings before interest, depreciation and taxation were $190 million in 2011. This year, they will be about half that amount. The company is about two years away from being unable to meet the interest payments to the hedge funds that put up the cash to buy the Canwest properties. 

CEO Paul Godfrey initially talked about strategies to increase revenues at the 10 dailies across Canada. He was enthusiastic about  “Digital First,” an early initiative that has been a bust. Digital revenues - subscriptions and advertising - will be about $88 million this year, unchanged in four years. If the future is digital, Postmedia is in trouble.

The latest quarterly update includes a telling note on costs. 

Postmedia has outsourced production at three newspapers over the last 18 months.

Corporations usually contract out because its cheaper. But Postmedia reports production expenses jumped 25 per cent for the first half of this fiscal year, “primarily as a result of outsourced newspaper production of the Calgary Herald in November 2013, the Montreal Gazette in August 2014 and both The Vancouver Sun and The Province in February 2015.” The increased costs are about $9 million a year.

The contracting-out program does free up some real estate for sale, which will let Postmedia reduce its debt load.

But a corporation can look at that process in two ways.

If the debt repayment results in interest-rate savings greater than the increased production costs, the company is protecting its long-term sustainability.

If, however, the increase in production costs is greater than the interest savings, then the company is more focused on loan repayment than its future.

Postmedia looks to be taking the latter approach.

In Vancouver, Postmedia sold the press building for $17.5 million and handed the full amount over to Unifor, the union representing employees. The union agreement had strong language preventing contracting out; the payment was compensation for accepting the change. The deal saw $11.5 million in severance for affected employees, and $6 million paid to Unifor that it can spend “as it sees fit for the benefit” of affected employees.

In Montreal, the press centre was sold for $12.4 million. The Calgary Herald building - constructed in 1980, when newspapers managers thought the future was bright - is assessed at $41 million. Even if it brings $50 million, the interest savings will be barely half the increased production costs.

Which makes Postmedia look like a corporation in the process of wringing value from its assets before selling the remains, or writing them off.

Postmedia’s purchase of Quebecor’s 175 English-language newspapers, including the Toronto Sun and 32 other paid-circulation dailies, doesn’t change that. 

Quebecor sold cheaply at $316 million, or about $1.8 million per newspaper. (Quebecor had spent something over $1.5 billion assembling the group of newspapers since 1998.) The business has been trending steadily downward, but the properties still produce about $85 million in earnings before interest, taxes, depreciation and interest. And Postmedia hopes to make $60 million by selling the newspaper’s offices, and leasing space. (Again, not necessarily a sound long-term decision.)

But the deal does not change the fundamental problems facing Postmedia.

There is a point where business owners decide that the best strategy is to extract the most value in the limited time remaining. Based on the quarterly report, Postmedia looks to have reached that point.

Andrew Weaver, the National Post and media accountability

The National Post devoted just 160 words to the news it had lost a defamation suit launched by Victoria  climate scientist and Green MLA Andrew Weaver and had to pay him $50,000. Even that brief report didn’t come until two days after other media reported the B.C. Supreme Court decision.

It was a striking contrast to the Post coverage when television personality Ezra Levant lost a similar defamation suit in November. That was big news and reported in an 800-word article.

The piece had a catchy headline “Levant guilty of defamation, must pay $80K; 'Reckless.'” The lead was dramatic. “In his blogging about Canada's hate speech laws, rightwing personality Ezra Levant defamed a young law student as a serial liar, a bigot and a Jew-hating ‘illiberal Islamic fascist,’ bent on destroying Canada's tradition of free expression, a judge has found.

The Post’s coverage of its own defamation defeat wasn’t just shorter, it was duller. 

The headline was “Climate scientist wins defamation suit against National Post.” The lead lacked the Levant story’s flair. “A B.C. Supreme Court judge has ordered the National Post to pay climate scientist Andrew Weaver $50,000 in damages in a defamation suit over articles published in 2009 and 2010,” the Post reported tersely.

The Levant judgment was more damning. But a finding that the Post and three of its writers - including the business editor - all defamed Weaver seems like big enough news to rate more than six paragraphs.

And when the Post decided to appeal the judgment this week, that rated a story twice as long as the original story on the verdict. 

Not to single out the National Post. Generally, the news media can dish it out, but aren’t so good at taking it. 

The Toronto Star ran a seriously flawed article on Gardasil vaccines last month. The front-page play and banner headline - “A wonder drug’s dark side” - suggested great importance. The stories of young women who suffered serious problems after vaccination were heartrending.

They far overshadowed the story’s cautions that, despite the headline, there was no established link between any of the women’s illnesses and the vaccination. There was overwhelming scientific consensus the vaccine is safe and effective.

The article drew immediate criticism. And The Star’s reaction was to deny any possible problem and to bash the critics. Editor Michael Cooke indulged in insulting Twitter exchanges. Columnist Heather Mallick responded with a generally baffling piece. The Gardasil vaccine story, she wrote “was not about the drug itself — it is safe and effective — but about parents and girls not always being told what they need to know in order to make informed decisions, and being dismissed by doctors when they became terribly ill.”

It’s impossible to reconcile that claim with the actual headline or the story. 

And Mallick dismissed one critic of the story casually. “Here’s a tip: don’t read a website run by a rural doctor whose slogan is ‘wielding the lasso of truth,’” she wrote. Leaving aside the assumption that rural doctors know nothing, Dr. Jen Gunter is an ob-gyn certified in Canada and the U.S. and practises in San Francisco. 

The Star eventually admitted it blew the story. The public editor set out the problems, the publisher apologized.

But the first response was self-righteous defensiveness, and attacks on anyone who dared criticize.

That’s a newsroom instinct. Partly, it’s justified. Anyone who has spent time in news management has faced pressure from the powerful, or people who think they are powerful. Managers know staff are watching to see if they cave.

But it’s also a way of avoiding justified criticism, or self-examination. 

There was a legitimate story in The Star report, especially around the level of informed consent. But it was lost in the torqued presentation. The point of the story, to any reasonable reader, was that the HPV vaccine Gardasil could leave you terribly sick and permanently injured. There is no evidence that is true, and noting that in a few paragraphs is not enough.

The Globe and Mail’s response to columnist Margaret Wente’s serial plagiarism followed the same pattern of initial defensiveness and dismissal of the person pointing out the problem. (An “anonymous blogger,” the Globe’s public editor sniffed.) There is an instant tendency to reject any criticism as uninformed or malicious, attack the critics and claim some imaginary high ground.

The news media got away with that kind response in the old days, when they were more powerful and critics had a hard time finding a platform.

But times have changed. Wente’s serial plagiarism was discovered and documented by Carol Wainio, an artist and university professor. She shared it on her blog and the compelling evidence was widely shared on the Internet. 

Attacking the messenger doesn’t work when people can see the evidence for themselves. 

It’s a welcome development. Newspapers can quit funding ineffectual press councils (as the major daily newspapers in British Columbia have already done). News media no longer need public editors or ombudspeople or readers’ representatives.

If they mess up, they will be held to account in public forums. News media that welcome the new accountability and the chance to learn from mistakes - which are inevitable - will increase their engagement with their audiences. 

And those that opt for defensiveness or unjustified attacks on critics will find credibility fading away.

Clark backs right to unions, except for health workers

Union rights for construction trades...  but not for these women Photo: NS News

It’s tough to buy Premier Christy Clark’s sudden commitment to people’s right to organize a union. 

Not when her government continues to make it impossible for thousands of low-paid workers in seniors’ care homes to join a union and freely negotiate workable collective agreements.

Clark over-ruled B.C. Hydro, the provincial bureaucracy and several cabinet ministers last week and ordered the Crown corporation to ease its efforts to keep the Site C dam a non-union project.

She singled out measures designed to prevent employees from deciding to form a union. "I don’t believe that’s legal, I don’t believe it’s right," Clark said. "I believe they should have the right to organize and BC Hydro can’t take that away."

Clark should meet with the employees at Inglewood Care Centre in West Vancouver. They decided to join the Hospital Employees’ Union in late 2013, and set out to negotiate a first collective agreement with Carecorp, the contractor that provides labour to Inglewood and residences.

By December, the two sides were far apart and the union issued strike notice.

And Carecorp responded by firing more than 230 employees. It is giving up its contract with Unicare, the corporation that operates Inglewood and six other similar residences in B.C., Alberta and Washington. 

Unicare will find a new contractor for Inglewood. The employees will lose their jobs, although many will be rehired by the new contractor, without seniority and at new wages and benefits.

And the union will disappear. 

Sure, the new employees and the HEU or some other union can go through the difficult certification process again. 

But that’s a tough sell once employees know that if they do, they’ll just get fired again. What’s the point?

The contractor shuffle has become common practice across B.C., as care homes  and seniors’ residences - privately owned, but also funded by health authorities - change contractors once employees unionize and try to negotiate a contract.

Bad for the employees, obviously, and bad for residents of the homes as wholesale staff changes every few years create training problems and a lack of continuity.

And certainly a concern for Christy Clark if she really believes employees have a right to organize.

The B.C. labour code allows employers to contract out work, unless an existing collective agreement prohibits it. 

But unionized employees outside the health and social services sectors have the right to appeal to the labour board if they believe that the decision to contract out, or change contractors, is aimed at getting rid of the union. The board can impose remedies, and the union certification and collective agreement can be forced on the new contractor.

That changed for health and social service employees after 2003, when the Liberal government used legislation to remove prohibitions on contracting out from their collective agreements. The legislation also said the labour code sections on successor rights would not apply to these groups of employees.

The government wanted to cut spending. It chose to achieve the goal by weakening the unions, making it harder for employees to organize and driving down wages and benefits for people working in hospitals, care homes and community social services. 

It worked. And those provisions survived the Supreme Court of Canada that found many other aspects of the government’s legislation attacking the unions were illegal.

But if Christy Clark really believes that employees have a right to organize, and that it is “wrong” to try and prevent that from happening, then she needs to fix this problem.

Labour law is about balance. And the current law tilts the balance entirely in the employers’ favour in the health and social services sectors. 

Sure, the employees can decide to form a union, just like other workers. They can try to negotiate a first contract, never an easy task.

But they can’t really bargain like other employees. Because they know that the care home can cancel the contract with one service provider and sign a deal with another contractor. The employees are on the street. The union ceases to exist. And unlike public-sector managers, the employees get no severance. The Employment Standards Act just requires working notice.

And the government has never made an effective argument for denying one group of employees the rights enjoyed by everyone else in the province.

The cynical might argue Clark’s Site C position was motivated by a desire to stay on the good side of Tom Sigurdson and the B.C. and Yukon Building and Construction Trades Council, which represents workers on big construction projects. Or by the lawsuit the the council had filed against B.C. Hydro’s plans.

But assume the premier does believe employees have the right to decide to form a union and try to negotiate a collective agreement (even if they are ultimately unsuccessful).

If it was wrong for B.C. Hydro to deny those basic rights to construction workers, how can it be less wrong for the provincial government to do the same for care aides, cooks and other workers in the health and social services sector?

Letter from Leon: Battling the dust storms

Looking from the square to the Iglesia el calvario on a sunny, dusty Saturday

When we said were heading to Leon once our Cuso International placements ended, our Nicaraguan co-workers warned us about the heat.

They forgot to mention the dust storms.

It is hot, heading to 36 today. But we’re pretty good at handling heat by now.

But the dust, it’s new. We’ve been here a week. For the first few days, we just marveled at the need to sweep four or five times a day and the way every surface was covered in fine black grit in a matter of hours. It didn’t seem that surprising, since windows and doors needed to be open to battle the heat.

Yesterday, things got crazy. The winds were much stronger and the dust storms turned the sky a pale yellow, blocked the view of nearby hills and even made it hard to see churches from a few blocks away. The six-block walk to the market was decidedly unpleasant as dust coated skin and scratched at eyes. Drivers coming into town had their headlights on at midday. (Not the norm here.)

Our house has windows and doors that we can close. Lots of people, including some of our neighbours, make do with sheets hung over the windowless gaps in the wall.

Partly, Leon is just a victim of its environment. Strong winds - about 45 km/h an hour as I write this and gusting way higher - sweep toward the Pacific coast, about 20 kms away. We’re surrounded by volcanos, and the fine ash from past eruptions travels easily.

But people here also point to the loss of windbreaks and ground cover that stopped soil from being blown away. The big agricultural producers of sugar cane and peanuts take a lot of the blame, and the Google satellite view of the region shows vast areas of soil waiting for planting - or to be blown away.

It’s not just the big producers though. Poor families cook with wood, and windbreaks are convenient places to find fuel, whether to use or to stack in the yard and sell to other people.

It’s blowing even harder today. The doors and windows are rattling, and you can see the dust clouds racing across the sky. The winds produce mysterious cracks and bangs from all directions.

We were going to head to the ocean, but it seemed a like a better day to stay in the house. We’ve got a little terrace off the kitchen, with walls about four metres high on two sides and an end wall of brick and corrugated tin that towers about nine metres over the space. They break the wind and it still gets sun.

And the terrace has a pila - a concrete sink with space to store water and wash clothes. We’ve also got a big blue plastic barrel which, as veterans of Central America, we keep filled with water. If you get hot, or dusty, you can just dump buckets of water on your head.

Which, it turns out, is lucky. Yesterday the water was off by 9:30 and didn’t come back until 5 p.m. It’s out again today. 

Angry Leon residents marched in the streets last July to demand the government do something about the dust storms - plant more trees, make stricter rules for the big farmers. They worry about illness as well as the pure unpleasantness of being pelted by dust and finding everything you own covered in grit minutes after you’ve cleaned up.

If they take to the streets this month, I will be with them.

In The Tyee - my piece on why journalists shouldn't be friends with the people they cover

Journalists: Never Befriend a Source

Columnist's athlete admission shows favourable coverage -- not good reporting.

By Paul Willcocks, Today, TheTyee.ca

 

   

A too-cozy relationship between a journalist and source hurts coverage.Flickr photo: by Mr.TinDC

• Journalism's 'Ethical Vertigo'

  In the era of renegade bloggers and newsroom scandals, a UBC prof writes the book on reviving press ethics.

• How Journalists Invented Ethics

  And why they still struggle to get it right.

• How APTN covered Idle No More
• Read more: Media

It probably wasn't the point he wanted to make, but Globe and Mail sportswriter Cathal Kelly set out the definitive argument for keeping a studied distance between journalists and the people they write about.

Kelly was reacting to a rant by Toronto Maple Leaf player Phil Kessel about how unfairly the media has been treating the team's captain Dion Phaneuf.

Maybe that's true, Kelly wrote. But the players don't treat the reporters like people. If the athletes were nicer, learned journalists' names, pretended to be interested in them, then the coverage would be kinder too.

Chat with a reporter in a coffee shop lineup or schmooze in the dressing room, and everything changes.

''Once that's happened, you'll never rip that guy in print,'' Kelly writes. ''You'll criticize, but the ripping days are over. He's not just someone you cover any more. He's someone you know.”

It was a weird piece. Readers think journalists are doing a professional job of covering sports or business or politics. They don't expect a few fake pleasantries from the subject -- or their absence -- determines what and how the journalist writes...

READ THE REST OVER AT THE TYEE.

Saanich, Atwell, online noise and big issues being ignored

   Train wreck, gong show, circus - the clichés used to describe the municipal meltdown in Saanich, Victoria´s bigger suburban neighbour, have been piling up. Newly elected Mayor Richard Atwell is being likened to Toronto´s Rob Ford, always a bad sign.

   But all that noise is drowning out the fact that important issues are being ignored in a time of trial by Twitter and quick news hits. If this is local politics in the new age of social media, I don’t like it.

   Two narratives have emerged after Atwell´s first 50 days.

   In one, he is an incompetent, untrustworthy, weirdo loner. (Do you have Asperger’s, a TV reporter asked Atwell.)

   In the other narrative, Atwell is the people’s champion, battling media, business and political elites determined to crush him by any means.

   We’ve always liked simple stories pitting good – our side – against evil. And gossip, wild speculation and blindness to unwelcome facts aren’t new.

   But we once recognized reality is more complex, with the help of news media that provided information framing a rational discussion of issues.

   So far, that hasn’t happened this time. Social media and online forums have been giant megaphones for the gossip and wild accusations by Atwell’s supporters and detractors, reinforcing the simplistic narratives. 

   And traditional news media haven’t cut through the clamour in a way that focuses attention on potentially serious allegations about police abuse of power and computer spying.

   Atwell is an outsider who toppled 18-year Saanich mayor Frank Leonard in November. He has no political experience, which his supporters consider a plus. He did help lead the campaign against the Capital Regional District’s sewage treatment plan, a movement built on anti-establishment fervour.

   He got off to a wretched start as mayor, showing up at the municipal offices before he was sworn in to axe Saanich’s chief administrative officer Paul Murray. He hadn’t discussed his plan with council, which is actually responsible for hiring and firing the top manager. Atwell’s action cost Saanich taxpayers about $480,000 in severance, damaged relations with councillors and created the early impression he was clueless.

   Then the weirdness escalated. On. Jan. 6, the Times Colonist, citing unnamed sources, reported police had responded to a 911 call at the home of a woman who had worked on Atwell’s campaign. There had been a dispute between Atwell and the woman’s fiance, the newspaper reported.

   Atwell didn’t respond to Times Colonist calls before the story broke, and avoided the media for another for 24 hours. When he finally appeared, he said it was a small misunderstanding and he wasn’t having an affair with the woman. (He’s married.) 

   Five days later, Atwell called a news conference. He admitted he lied when he claimed he wasn’t having an affair.

   And he went on the offensive, saying he had asked B.C.'s Police Complaint Commissioner to investigate how information about the 911 call became public. 

   Atwell also said that since the mayoral campaign began he had been stopped four times by the regional road safety unit and been given roadside breathalyzer tests twice, blowing 0.0 each time. (One stop was clearly legitimate; he had an expired insurance sticker.)

   Atwell said he wanted the head of the unit to investigate whether he had been singled out by police. (The Saanich Police Department has four officers on the 15-officer traffic regional unit. The police union had backed Leonard for mayor.)

   And Atwell revealed his lawyer had asked Saanich police to investigate the legality of spyware placed on his computer at municipal hall, which he learned about Dec. 11.

   Supporters and detractors flooded the online forums and the news media jumped on the story.

   But, mostly, the two existing narratives prevailed. There was little focus on the real, big issues raised or the holes in the official response.

   Take the surveillance software installed on the Atwell’s work computer, a product capable of capturing all the keystrokes and content as well as sites visited. Saanich police investigated and hired lawyer and former B.C. police complaints commissioner Dirk Ryneveld for advice. (Why an outside lawyer was needed hasn’t been explained.)

Police reported to council, behind closed doors, that no Criminal Code offence had been committed.      Council released a statement on the investigation a day later, on Jan. 11. But given the seriousness of the allegation, it was incomplete and opaque, raising as many questions as it answered.

   The spyware was placed on “a number of District of Saanich computers,” council said, but it didn’t say how many. The program was the result of recommendations from an external audit of computer systems done in May, council said. 

   But the surveillance program wasn’t purchased until ¨late November,¨  after Atwell won the election.

   If Saanich staff had identified a security problem, how come it took six months to act? Why was the mayor’s computer among a small number targeted? What was the written policy around meaningful disclosure of the surveillance to computer users? 

   While the police decision that no Criminal Code charges were warranted was probably correct, B.C. Information and Privacy Commissioner Elizabeth Denham noted covert computer monitoring - “tracking Internet use, logging keystrokes, or taking screen captures at set intervals as part of ongoing monitoring” - had so far always been found to be contrary to provincial privacy protection.

   Those serious issues were mostly lost in the noise, although this week Denham announced her office would launch an investigation into the use of the surveillance software. (The investigation will also provide a useful assessment of the competence of the new Saanich council, which reviewed the surveillance program and found no concerns.)

   Allegations about police activities have also received too little attention. 

   The Saanich police board met behind closed doors and said Atwell should not take up his role as chair. They wrote Justice Minister Suzanne Anton asking for an investigation, though into what was unclear. (She said no.)

   But neither the board nor the police department has responded to Atwell’s concerns that someone in the department leaked the information about the 911 call. That’s a serious issue of public interest, and the department has the ability to launch an investigation and report publicly. It apparently hasn’t, and the police board has shown no interest.

    And I haven’t seen any news stories following up on the allegation that Atwell was targeted by traffic police. Four stops in a few months seems unusual. The decision by officers to administer two roadside breathalyzer tests which both showed Atwell had consumed no alcohol also demands an explanation.

    At the least, it would be useful to have the media report a response to the allegations. Have senior officers looked at the files and checked the officers’ reasons for deciding Atwell might be impaired? Have they checked to determine if anyone pulled his vehicle files during the campaign? 

   So far, Atwell has been a blundering mayor. That’s just the way democracy works sometimes. Maybe he will get better at the job, maybe he won’t.

   But something has gone really wrong with our collective ability to respond sensibly to his travails and some very big issues that have been raised along the way.

   And that’s much more worrying.

Saanich council fumbles the computer surveillance issue

Saanich council is doing a lousy job of dealing with the suburb´s bizarre political problems.

Mayor Richard Atwell complained to Saanich police on Dec. 15 that spyware had been installed on his office computer without his knowledge.

Police investigated and, apparently, decided to hire former B.C. police complaints commissioner Dirk Ryneveld for advice. They concluded no Criminal Code offence had been committed, and reported to council behind closed doors on Monday. Council released a statement Tuesday.

But it was a lame effort. Weasel words and lack of clarity are warning signs in this kind of situation.

The statement said security software had been installed on ¨a number of District of Saanich computers, including the office computer of Mayor Atwell.¨

How many computers? Three, 10, 30? Was the software placed on any councillors´ computers, or just the mayor´s? A complete report would have answered those questions.

The spyware was placed on the computers in ¨late November,¨  the statement said, based on recommendations  in a May 2014 computer system audit.

The action was after the election. An explanation of why it took six months to deal with a computer security problem, an issue that should be taken seriously, would be welcome. So would evidence – a purchase order for the software from August, for example – to show this wasn´t launched after Atwell won. Given his allegations, answering all those questions fully should have been important.

The decision that no Criminal Code charges were warranted is correct. The law lets employers spy on private communications  to protect a computer system.

But Atwell might have had better luck with a complaint to the B.C. Information and Privacy Commissioner.  B.C. privacy regulations allow overt computer monitoring by employers as a matter of course if employees are told, before the process begins, what is allowed and what isn´t and how they will be monitored. The surveillance is broad – things like websites visited.

The rules are much stricter around covert monitoring, commissioner Elizabeth Denham said in a release this week.  “This type of monitoring could take the form of tracking Internet use, logging keystrokes, or taking screen captures at set intervals as part of ongoing monitoring.¨

It´s only allowed when there is a specific investigation into wrongdoing and only after all less invasive investigative measures have been exhausted, she notes.

So far, the privacy office has found all cases of covert monitoring unjustified. None have been found to be within the province´s privacy law.

Which raises two issues.

First, Coun. Judy Brownoff said Saanich has a well-known policy that tells employees their computers may be monitored. Council should have produced that policy and shown that it was shared with Atwell and other people whose computers were being monitored under the new program.

Second, it´s unclear what sort of monitoring Saanich is doing under the initiative launched in November. Given the controversy, and the capabilities of the software apparently being used, council should have determined and reported on its security activities, especially in reference to the issue of covert versus overt surveillance as defined by the privacy commissioner.

I´m not choosing sides. Atwell´s tenure has been a mess, starting with the destructive, arrogant and expensive effort to force out the city manager.

But that simply makes it all the more important that council do its job well. It didn´t this week.

Letter from Managua: A canal dividing a country

The proposal to build a trans-oceanic canal across Nicaragua seems mostly like the scenario for a slightly implausible summer blockbuster movie.

The movie would have it all. Powerful business forces, environmental risks, social upheaval and conflict and even global intrigue - Chinese interests are behind the project. And lots and lots of mystery. I can see Matt Damon and Angelina Jolie racing from Caribbean villages in Nicaragua to skyscrapers in Hong Kong in a race to uncover the truth.

The canal would be about 280 kms long, more than twice as long as the Panama canal. A short 24-km section would let ships travel through locks from the Pacific to Lake Nicaragua (or Cocibolca, its indigineous name). Giant container ships would travel about 70 kms across the lake, the largest in Central America, and then through a canal across some 180 kms to the Caribbean. 

Der Spiegel

Details are sketchy, but the goal is to allow ships capable of carrying 18,000 containers, about 50 per cent lager than the ones the new locks being built in Panama can handle. (For a fascinating look at how shipping containers transformed the world, I hihgly recommend Marc Levinson’s The Box.)

All that comes with an entirely unsupported price tag of $50 billion, about three times the combined cost of B.C.’s Site C dam and Enbridge’s Northern Gateway pipeline project. And while Site C represents about 3.7 per cent of British Columbia’s GDP, the new canal would represents about 250 per cent of Nicaragua’s GDP. 

Sounds like a crazy project for a poor country. (Nicaragua was ranked 132 in the 2014 UN Human Development Index report, ahead of only Haiti in the Americas.) 

The canal project is being backed by Wang Jing, China’s 12th richest man with a fortune of some $6.4 billion, according to Forbes magazine. President Daniel Ortega, one-time revolutionary, supports the project and his son Laureano is the link with the government. The largest business group backs the megaproject.

But there is fierce opposition, based in part on the secrecy and lack of real planning. Last week about 3,500 Nicaraguans marched in the streets of Managua. They arrived despite efforts by government transportation officials and the police to keep groups from travelling to the capital. The military has moved into the countryside where canal opposition has been strongest.

There are four big concerns about the project.

First, a lot of people – perhaps 30,000 - are going to get pushed off their land to make way for the canal. That´s no big deal in China, where some 1.5 million people were relocated to make way for the Three Gorges Dam. But it will be in Nicaragua, where land can mean survival.

Second, there have been no real studies of the environmental impact. The project would mean dredging rivers and blasting a 70-km channel across Lake Nicaragua, a beautiful, largely unspoiled treasure. Thousands of hectares would be cleared, new lakes built to hold water to operate the giant locks and both coasts would be affected. The country would literally be cut in half, with plans for one bridge at this point.

Third, there have been no social or economic impact studies, or publicly released information on the business case for the canal. 

Shipping experts are skeptical. The canal would knock about 1,300 kms off the sea route from China to the East Coast of the U.S., but the canal would take longer to transit then Panama. 

The government is claiming the canal will create 50,000 construction jobs and 200,000 permanent jobs, but it hasn’t set out the value of the concessions granted to Wang´s company, which include the right to operate two ports, an airport, tax-free industrial zones, a railway and pipeline and other potentially profitable businesses. One fear is that the canal will never be built while Wang will cash in on the other opportunities.

And fourth, there is wide speculation that the canal is less a commercial venture and more an effort to extend Chinese government influence in the region. Wang hasn’t revealed where the $50 billion will come from, and investments from Chinese state-controlled companies are considered likely. For analysts who doubt the plans commercial rationale, the geopolitical strategy makes sense.

Work is scheduled to start on Monday, with the first projects a new dock on the Pacific coast and roads to receive the heavy equipment and supplies needed for the project. 

The idea for a canal has been around for a long time. In the to-be-read section of my Kobo is the 1852 book ¨Nicaragua: Its People, Scenery, Monuments, and the Proposed Interoceanic Canal.¨ U.S. tycoon Cornelius Vanderbilt was awarded a canal concession in 1849. He never built it, but made money off a train and stagecoach route.

It´s always been controversial. And it still is.

Letter from Managua: Missing the strange

I can see why people wind up travelling to more and more exotic places. After a month in Managua, I recognize a faint disappointment at the lack of full-on culture shock.

The first month in Copan Ruinas, less than three years ago, was a thrill ride of new sensations. The grungy home stay, the cobbled streets, the half-starved dogs and sheer newness of life in the world’s most dangerous country. We would walk along, under the scorching sun, and say ‘Geez, we’re living in Honduras’ in a slightly bewildered way.

The arrival in Nicaragua was wildly uneventful by comparison. Sure, there’s a buzz landing at night in any big Central America city, and it was strange to have the airport staff all in surgical masks and a thermal camera employed to see if we had fevers. (Ebola was their worry, with good reason. If it ever got a foothold in Central America, things would get desperate fast.)

But we quickly found a place to live, having learned the only way was to walk the streets looking for signs and asking anyone you saw about places for rent. Within the first hour or so, a helpful guy guided us to our eventual home. We found the stores, stocked the casa and started work with our Cuso International partner organizations.

Part of the difference is that Copan is a town of about 8,000 and Managua is a city of some 2.5 million. We were plunged into a whole new world in Copan, where a 20-minute walk took you into some dead-poor villages. In Managua, we’re in the Barrio Bolonia, a pretty nice neighbourhood. There’s a PriceSmart a couple of blocks away, a Costco clone.

And part of the difference is that Honduras is a wilder place. Nicaragua actually ranks lower on the UN Human Development Index, ranked 132 out of 187 countries, with Honduras in 129th. GDP per capita is about $4,300, compared with Canada’s $42,000. 

But the taxi drivers in Managua don’t pay weekly extortion fees to the street gangs. The murder rate is around 15 per 100,000, compared with the ridiculous rate of around 85 per 100,000 in Honduras. That meant about 18 murders a day, most never investigated.

Still, Managua is hardly Victoria. I walk a little over three blocks to work, and say hello to half-a-dozen security guards. Horse carts trot through the barrio and there are no street signs, or even names. The cathedral on the main square is a beautiful ruin, shattered in the 1972 earthquake and never rebuilt. A mysterious Chinese billionaire plans to start work next month on a canal from the Atlantic to the Pacific, with the Ortega’s government support and without much of anything in the way of consultation or economic or environmental studies. We’ve been to one giant, crazy market; an even bigger one is considered highly risky to even venture into with any possessions of value. 

It’s nice to wander, as we did Saturday, down a main boulevard where the government is setting up some 20 giant displays dedicated to the Virgin Mary, without constantly looking over my shoulder. I’m keenly looking forward to Dec. 7, when at 6 p.m. we all pour into the streets, set off fireworks and sing and chant to give thanks for her birth. 

Things are still plenty different here. But we’re different too. While I like being better at settling in, I miss the shock of discovery that was so vivid when we landed in Honduras. Or I think I do. 

Letter from Managua: Streets with no names

I got used to the lack of addresses in Copan Ruinas, Honduras. We told people we lived in the Casa de Jorge Ramos on Calle Independencia. They usually knew where I meant.

But Managua has upped the game, shunning not only addresses but street names. Beyond a handful of main highways, streets have no names. Finding your way around a city of 2.4 million people without any street names or addresses is like some kind of strange experiment in ingenuity.

Alexis Arguello statue
- just walk west

Cuso International’s business cards and letterhead do not have an address for the Managua office, or even a street name. There isn’t one.

Instead, the business card says ‘From the Optica Nicaraguense, go up one block and then one-and-a-half blocks south.’ It’s in Barrio Bolonia, the card says, which narrows the search. And ‘up’ means east, because that’s where the sun comes up.

That’s what substitutes for addresses. Every business, or home, is located in relation to some supposedly well-known waypoint. 

I’m working with APEN, the Associación de Productores y Exportadores de Nicaragua. Its address is ‘From the Iglesia San Francisco, 20 varas up.’ (A vara is a largely obsolete Spanish measurement just shy of a yard.)

It can get worse. Some of the addresses refer to reference points that no longer exist. (‘From where the big tree used to be.’)

And standing at a corner in a strange city, without a compass, the whole idea of deciding which way is north is difficult.

Managuans don’t seem to find this strange. But aside from the confusion of people like me, there has to be a significant economic cost. How many deliveries have gone wrong because a driver never could figure out where a store or home was? How many new businesses have failed because customers decided not to take a chance on going three blocks east from the Canal 2 building, one-half block north and then 40 varas west? How weirdly has development been skewed by a desire to locate near a prominent waypoint?

But Cuso volunteers soon learn a basic lesson. Strange is the new normal.

We found a place to live for the next four months, a bedroom with private  bathroom in a nice house in a good neighbourhood, with shared living space and kitchen. It should serve nicely.

If you want to visit, come on down. Look for us 40 varas east of the chess academy in Barrio Bolonia.

Come to the Bard and Banker Thursday for my book launch

It’s been a long time between posts.

Lots of good reasons. We’ve had two weddings in October, two daughters marrying two great guys. They’ve been fun and inspiring, and a chance to re-connect with people who matter. 

I’ve been doing interesting work for The Tyee, BC Business and Douglas Magazine. 

We - Jody Paterson and I - have been looking ahead to new Cuso International placements in Nicaragua. 

And there has been ‘the book.’ The real title is Dead Ends: BC Crime Stories, but for a long time, as I laboured away, it was just ‘the book.’

It’s my first, published by the team at the University of Regina Press. I researched and wrote about 40 B.C. crimes from the 1860s to today. I knew the stories would be great, and the characters fascinating. But I didn’t anticipate that the crimes would reveal so much about us and our history. 

The book was released Sept. 29, and I’ve been trying to figure out, as a first-time author, how to get people to read it. (Munro’s Books listed it among more than 1,200 new releases in September, which sets out the challenge rather starkly.)

On Thursday, at the Bard and Banker pub in Victoria, there’s an official launch party. It will be low key. We have the comfy Sam McGee room. I’ll talk a little bit about writing the book. Copies will be on sale for $20, with $8 going to Cuso International and Casita Copan, an amazing project to support homeless kids and struggling families in Copan Ruinas, Honduras, where we spent more than two years. But it doesn’t matter if anyone buys books. There’s a piano, if you want to play.

Mostly, I hope people will show up and talk to each other. I have almost 400 Facebook friends. Jody has 1,805. I don’t know who they are. But it would be interesting if we all got together for a few hours, especially as we head to Managua in less than two weeks.

We have the room from 6:30 pm to 9. Come on down.

Public might blame both sides, but holds government responsible for inaction on strike

Both sides are losing in the teachers’ dispute. The spin and counter-spin, PR gestures and ad campaigns aren’t moving the parties any closer to a deal.

More and more people - as an informal sampling by The Tyee suggested - are sick of both the BCTF and the government.

Which means the government is going to have to step in and end the strike.

The chances of a negotiated settlement were always tiny. The posturing by both sides and unwillingness or inability even to bargain the key issues has reduced them to about zero.

Each side blames the other. 

But - and it is an enormous but - only one side has an actual responsibility to see that kids get an education, and the ability to make that happen.

All the Twitter ads and press conferences blaming the BCTF don’t change that. Governments are supposed to make sure citizens get the services they need (and are paying for).

The BCTF’s foolish two-week June strike was a nuisance (and self-destructive). The loss of the first week of classes was tolerated by many people.

But the government’s apparent willingness to stand by indefinitely while some 580,000 students are deprived of an education is going to generate more and more public anger. Especially as there is no sign the hard line is going to produce a resolution. 

Each day the government fails to act now adds to the impression that it doesn’t really consider education a priority, let alone an essential service, as Premier Christy Clark once argued.

There are several options. A legislated end to the strike combined with an imposed settlement or a report from an industrial inquiry commissioner, for example, or an appeal to the Labour Relations Board for a ruling that education is an essential service.

Leaving students and parents adrift during a PR war with teachers - will increasingly be impossible.

And the government’s willingness to do nothing despite the damage to students  will increasingly carry a political cost.

Clark's press conference bad news for province's court prospects

The tit-for-tat press conferences by Premier Christy Clark and BCTF head Jim Iker did nothing to advance negotiations, and left most people appalled by both sides.

But Clark’s comments seem especially damaging to the government’s long-term interests.

Assume the union holds out and the government legislates teachers back to work and imposes a new contract. 

Teachers would then challenge the agreement in court, pointing to the failure to negotiate class size and composition issues, as the B.C. Supreme Court has said it must. 

The court didn’t say the provisions, stripped in 2002, must be restored to the contract. But it said there must be good-faith bargaining. (And compensation for the damage done.)

A transcript of Clark’s press conference will be very helpful for the union cause.

Clark said the government would not begin bargaining on class composition until the BCTF reduces its wage and benefit proposals and an agreement was in place on those issues. She didn’t even acknowledge class-size limits as a topic for negotiation.

Clark’s comments indicated the government has made no serious effort to bargain the contentious issues, or address the B.C. Supreme Court ruling that class size and composition issues had been illegally stripped from the contract.

Her public insistence on preconditions before any real negotiation on the issues  makes a strong case that the government has not yet accepted the court ruling - or learned how to avoid another court loss.

It will weaken the government's ability to defend an imposed contract from a new legal challenge.

Footnote: The issue isn't complex. The teachers' union had successfully bargained to have class size and composition limits in contracts. (Composition refers to the number of special needs students in a class.) 

In 2001, the newly elected Liberals thought the limits were too restrictive, costly and properly a matter of education policy. 

So they passed laws in 2002 to strip them from the contract and bar the union from negotiating the issues in future.

The Liberals had a point. Class sizes are matter of education policy, which should be the responsibility of school trustees and MLAs.

But a sensible government would recognize they are also an issue of working conditions. Unions negotiate working conditions. There needs to be some balancing of interests, or at least a good-faith attempt.

The Supreme Court agreed. And it found the law violated the teachers’ rights. They had, presumably, traded off other items in past negotiations to get the clauses in the contracts. Government can not just pass laws to violate agreements without consequences. (The Liberals have accepted this principle in other areas. When it retroactively banned uranium mining, the government agreed to pay more than $30-million to Boss Uranium, recognizing there is a cost to ripping up legal agreements.) 

Teachers' dispute down to public pressure and first to fold

You can tune out all the rhetoric from both sides in the teachers’ dispute at this point. 

It has come down to a simple question - who will fold first.

The government hopes the BCTF will accept a negotiated deal, to avoid - or reduce - the risk of legal challenges. Given its losing record in the courts, that’s understandable.

The union would rather be legislated back if an acceptable deal can’t be reached, for the same reason. (The union leadership, after taking members out in a costly, ineffective strike strategy, also doesn’t really want to try and explain why the result was a mediocre negotiated settlement.)

So they are hunkered down, blaming each other and trying to rally support for their cause.

The government’s brave rhetoric about letting the strike/lockout continue is empty. Parents and the public won’t tolerate a government that fails to use its power to re-open schools. Especially given Premier Christy Clark’s past claims that education is an essential service.

But the Liberals hope the BCTF will cave before it has to legislate an end to the strike. Teachers lose, on average, about $1,700 a week in gross pay as the strike continues. They are already out $3,500-plus, with the losses mounting by the day. And they know that any settlement is not going to recover those losses.

Teacher support for the strike is fading, according to columnist Bill Tieleman. His piece in The Tyee argued that the union should continue the strike. One reason, he said, was that if the BCTF called a pause in the strike members would refuse to go back to the picket lines.

So parents and students wait, the parties wage a PR war and the schools stay closed.

What is most irritating is that the union and government have had five or six years to act on sound proposals to improve this hopelessly flawed bargaining process, but have done nothing.

RCMP's political response to budget cuts, or give us the money or we shoot the police dog

The only real surprise in RCMP budget cuts in British Columbia was that they didn’t threaten to chop the musical ride. 

The provincial government has reduced its contribution to the RCMP for policing in the province by $4.2 million.

RCMP management has decided to make all the cuts in the budgets of the special enforcement unit, including the squad investigating biker gangs, and the major crimes section, responsible for the missing women file, among other things.

Nowhere else left to cut, says Deputy Commissioner Craig Callens, the top RCMP manager in B.C.

Come on. The $4.2-million cut is less than one per cent of the RCMP budget for the province. The notion that the only areas to cut are two high-profile investigative units is laughable. 

A family with a $60,000 income facing the equivalent cut would have $540 less to spend. I’m betting they could find relatively painless ways to handle the shortfall.

Not the RCMP managers.

It’s a standard ploy to resist budget cuts, in any organization. Find the most visible, valued service and say it will be hurt. Claim cuts in admin, or travel, or overtime, are impossible.

And it’s a reminder that B.C. still has no real ability to set priorities or policies for the RCMP, even though its officers police about 70 per cent of the province.