Wednesday's session #777.

On Wednesday, January 22, we welcomed Ghislaine Richard, Canadian Permanent Representative to the ICAO Council, and her husband, lawyer Max Mendelsohn. Also, returning by popular demand, Judy Roberts from Toronto, one of Canada's leading experts on Distance Education.

The subjects, as usual, were wide ranging, however focused on the Canadian aviation industry, the Arrow, revisionist history, technology and education. There was also mention of President Clinton's inauguration, Desmond Morton's challenge to re-write the role of the Candian military, and other topical items which have not yet appeared in the media.

See the WEDNESDAY Night #777 8KB on the Avero Arrow By Herb Bercovitz
and #775 is well described below by Herb Bercovitz

WEDNESDAY NIGHT - #776

On Wednesday January 15^th, David and Andy Nulman of the Festival Juste Pour Rire had a discussion of the impact of the Federal Government's legislation on advertising/sponsorship by the tobacco companies. What will the effect be on Montreal's "Festival Industry"? Can our city afford to lose these sponsorships and will the loss truly result in downsizing of some of our major summer tourist attractions? What is the combined impact of the festivals on our economy? How do we fill the funding gap? Is sponsorship by the tobacco industry a method of selling more tobacco?

This was a great night ... Robert Stewart's discription will appear here soon!

David & Diana Nicholson

">© 1996 David T. Nicholson ">Send us your thoughts on any Wednseday please.

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January 8, 1997

The CIA Factbook on Hungary

Wednesday night at the Nicholsons number 775 turned out to be one of the more controversial. The unseasonably cold weather attracted a merethirteen guests, facilitating exchanges and favouring controversy. Among those present were Robert Landori-Hoffman, Hamish MacCauley, Julius Grey, Carl Beggie and Ron Meisels. Tony Deutsch, who had had considerable experience in reviving and redefining the Hungarian pension plan for the Hungarian government, was the key figure in presenting the problem, the similarities and differences with the North American situation. Of particular concern of course, was the future of the Canada and Québec pension plans, and the federal Old Age pensions.

Points on which there was consensus were rare. It was generally if not universally agreed however, that:

Present pension plans reflect future employment and demographic pictures predicted at the inception of the plan. These predictions are frequently inaccurate.

Because of the nature of politics, for many politicians, long range planning does not extend beyond their term of office. About eighty percent of recommendations made to cabinet are disregarded. Cabinet members do not work long term, but from day to day. It was suggested that because we reproach our politicians for not being ethical, analytical, etc., we should be thinking about how the political system can be reorganized, perhaps after a model evolved by a think tank.

Medical advances have increased life expectancy. There was lack of unanimity on this point, as there was disagreement as to whether people were living longer, or whether it was a matter of more previously fatal diseases now being curable, so that a higher percentage of the population wasnow surviving to pensionable age. In either case, it was agreed that this has had an unforeseeable impact on the viability of unfunded pension plans.

It was suggested that the Scandinavian plan was in relatively good shape because pensions were only collected starting age seventy. It was suggested that Canada might do well to return to that model. The dilemma among younger people is that they tend to want people to retire early so that more young people might be employed and advance in their employment. At the same time, they resent having to support the cost of pensions for the retirees.

The picture was painted of changes in technology necessitating a change in the pension model. Whereas when government pension plans were implemented, the financial burden for supporting each pensioner was shared among five or six employed persons. This ratio has diminished steadily; it is projected that by 2030, it will be reduced to two workers per pensioner. This is due to a combination of improved productivity and increased longevity.

It was suggested that existing employment positions be shared so as to increase the number of people employed, but it was pointed out that regardless of how it was achieved, improved productivity should really result in the ability if required, for two people to support a pensioner whose pension was based on a working in a less productive, less remunerative environment. It was suggested that the dismal unemployment figures in Canada over the past few years, has been a spinoff of NAFTA, and that this situation should change drastically in the near future. It was suggested that when this happens, the pension crisis might just be manageable.One guest received considerable support in his thesis proclaiming this to be a question of ethics.

When a person votes a government into office and that government introduces a universal pension plan, this is tantamount to establishing a contract between the government and the electors, not unlike an insurance company selling an annuity. The government should keep their word. In reasoned, professorial fashion, Julius Gray argued that the same people who claim that we can't afford the pensions also say that per capita wealth is growing. If these claims are both true, there should be no problem paying pensions and Medicare, provided measures be taken to rethink the appropriate distribution of wealth. Tony Deutsch challenged the notion that per capita wealth is indeed growing. He believed that the anticipation of such growth that had not in fact materialized, was at the source of the problem.There was much pessimism expressed on the future of pension plans, and the political will to face the problem, but there seemed to be a ray of hope coming from those who believe that Canada is on the edge of significant technological advance leading to swift increased growth. The technology which has caused the problem can play a major role in its solution, but redistribution of wealth must be part of the solution.

A partisan guest suggested that the Liberal philosophy is inimical to change, and that until there is a change in government at the federal level, there will be a devotion to the status quo.

There was lively discussion about the role of the media in creating public opinion. The same time and importance is accorded to views expressed by individuals representing a very small constituency, as those representing the vast majority of Canadians.

The Market

If there were general agreement on the state and direction of the stock market, money would be neither gained or lost. In the light of this observation, it is hardly surprising that Wednesday night #755 brought about no perceptible agreement on the direction in which the market is headed. The rate of return in some parts of the world is very poor. There is an increased rate of new offerings in the United States. Real interest rates must rise, bond rates fall. The bull market will end in July of this year.

Money is still flowing into mutual funds; I.P.O.'s are being grabbed up prolonging the bull market. Soon, perhaps within six months, the market will drop, people will redeem their mutual funds, which really only represent their short term savings, and the market could experience a drop of one to two thousand points. Guests were divided on the accuracy of this scenario. One acknowledged expert said that although he could not offer rospects for a bright future for Canada in the near term, because we remain resource-based, and the future belongs to the technology-based countries.

Japan is investing heavily in resources in Russia with non-union labour and modern technology. Within the next decade, these will be competing with our natural resources.

Another guest voiced his observation that Americans have been investing heavily in Québec. As they attain ownership of us, we as any other banana republic will be run by the large corporations. This will bring prosperity to the Montréal region. Things should improve enormously within five years. The world seems to be heading towards two types of countries, namely heads (Japan, Singapore, etc.) and bodies (South China, etc.) The true heads will be found in New York. Seeing its future there, it is not impossible that Ontario will secede to New York, and British Columbia to Asia.

Some members see the ten provinces regrouped into six states of equal importance, with the Maritimes joining to form one and the prairie provinces another.
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This very exciting Wednesday night broke up just before 11:30 p.m.