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The CCPA Study of Bill C-13

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    The CCPA Study of Bill C-13

    If you ask me . . .
    B A C K G R O U N D E R / Morris W. Dorosh

    The Canadian Centre for Policy Alternatives says it is an independent, non-partisan research institute concerned
    with issues of social and economic justice. What it really is is a propaganda engine promoting every left-wing, antifree-
    enterprise, pro-union, bigger-government cause it can find. It is supported by people and organizations with like
    agendas. The strategy of the left has always been to get the government to run everything and then to run or at least
    influence the government. That is the current U.S. direction, as anyone can see.
    It is not enough that Canadian agriculture is already drowning in its own internal politics. Now the CCPA has
    weighed in on, of all things, Bill C-13, the revision of the Canada Grain Act currently before parliament. It has published
    a ‘study’ concluding that this ‘controversial’ legislation threatens “Canada’s grain safety and quality.” Accor ding
    to its authors (including a CCPA ‘senior researcher’) Bill C-13 “ignores the lessons learned about the dangers of
    cutting back public inspection”. The bill seeks to “eliminate independent government inspection” of grain delivered to
    major elevators around the country and leave grain companies “free to arrange their own inspections.” That allegedly
    will permit pesticide-treated grain, glass, rodent droppings and other dangerous substances to contaminate “Canada’s
    food grain system.” The ‘study’ says this work requires “trained inspectors” who are independent of the grain companies
    and “accountable to the public.” In other words, unionized civil servants with full strike rights.
    It also complains that the bill will end “an established security program” that guarantees farmers are paid for grain,
    increasing “risk of catastrophic financial losses” if a buyer “cannot, or will not” pay up. There seems to be no end to
    the disasters uncovered by this purported study from the elimination of unnecessary, redundant and costly activities of
    the Canadian Grain Commission. If Bill C-13 passes, the “reputation and competitiveness” of Canadian wheat in international
    markets will be harmed, a mysterious price premium Canadian producers now receive will be lost, the risk
    of food-safety problems will be heightened and the power of huge U.S. -based multinational grain companies will be
    increased at the expense of Canadian producers. Canada’s existing grain system will be destroyed. The opposition
    parties in parliament should “work in the public interest” to “safeguard this regulatory success.”
    This is the application of simple-minded knee-jerk left-wing dogma to a subject about which the originators of this
    purported paper clearly do not know the first thing. C-13 does not eliminate safety or quality inspections of grain; it
    merely makes optional the inward weighing and inspection at terminal elevators of grain which has already been inspected
    at the time of first entry into the commercial handling system. This is a duplication of a service for which
    grain companies pay, ultimately reflected either in either lower returns to producers or less competitive prices to buyers.
    This is intellectual garbage is in the service of the grain inspectors’ union.
    The notion that “public” inspection is the only acceptable kind derives from the assumption that all private businesses,
    including grain companies, are systemically and generically crooked and irresponsible. The same view is
    obligatory of all very large companies, especially if they are U.S.-based. It happens that the majority of the activity
    and the assets affected by C-13 are Canadian. The inference that farmers might not be paid by buyers because they
    deliberately “will not” meet their commercial obligations has the same twisted, perverted origin. It is not hard to guess
    where the idea that Canadian grain commands price premiums came from.
    C-13 will not destroy the hyper-regulated Canadian grain grading and inspection system, which means that the bill
    does not go as far as it should. The bill just touches the excesses of regulation and intervention that are costly to the
    industry with no offsetting benefit. The entire statutory grading system, which restricts innovation, which is not demanded
    by any buyer and which has not been copied by any competitor, has got to go.
    This is a time of heightened food safety sensitivity everywhere. No one argues for the elimination of grain inspection.
    However raw grain is the least likely source of food safety problems. It is inspected numerous times, especially
    during processing, which is the most critical point and the only level at which all possible sources of quality degradation
    are reflected. The big losers if inspection misses something are the processors and purveyors of foods, who have
    more incentive to ensure product integrity than all the laws in Ottawa.

    #2
    "If Bill C-13 passes, the “reputation and competitiveness” of Canadian wheat in international markets will be harmed." ...

    I agree with that part of the article.

    Comment


      #3
      Just one word "Peanuts". Streamlining the inspection service is good, eliminating it is bad.

      Comment


        #4
        We should be allowed to hire private companies who are not unionized and therefore go on strike once every few years disrupting grain flows and increasing contract risk. Competition in the country will help ensure that grain is being graded properly. Each buyer wants a specific quality characteristic that is different amoung each buyer. There is no set standard like what the CGC has for grains that is exactly what the buyer wants. As you all know my opinion, the fewer the barriers to entry, the more competition, and the fewer the regulations, the better as long as the government enforces the law and contract law and ensures that no one monopolizes anything.

        Comment


          #5
          I agree that inspection and weighing would have and could be been done by the private sector without problems, and making these procedures optional was indeed a step forward. Quality of grain is not made by inspection it is only verified by inspection. The issue with C13 was it also removed licensing and bonding without a plan B in place.

          Given the economic times where world banks are at risk the timing of the removal of risk protection for grain deliveries could not have been worse.

          While I am STILL an avid proponent of the Ontario Corn Growers model of
          short term terporary insurance being used to cover grain deliveries as a more effective measure than the less
          predictable licensing & bonding program in place today, clearly the need to insure grain delivery against default is essential, and even more so in todays economy. The fact that there was not a transitional program in place to insure that an industry had access to insurance to guarantee payment on deliveries was the fatal flaw of this bill. Given the fact that, while you can (for the most part) protect immediate deliveries by a cash payment, deferrals would have not been covered at all, not even for 90 days! Given the instability in todays financial economy where even world banks are at risk, the bill had to fail for this reason. And really good on the department for recognizing this.

          Special crop companies spent decades trying to convince the industry that
          short term insurance was a much more effective and bankable program to use for special crop purchases. Proof of the programs success and simplicity and efficiencies was (and is ) alive and well in Ontario. After much review, the western industry chose then to keep and enforce the draconian measures of licensing and bonding: a less bankeable more combersome bureaucratic and costlier model.

          One might hope its time has come to take a second look at the short term insurance model. Lowering premium rates in Ontario made on question
          all why spend a few dollars a tonne on licensing and bonding when we can spend a few pennies (one does wonder!? but then there are all those jobs in Winnipeg!?)

          So like the CWB, where Ontario gets one system and we get the other the saga of the west goes on, and we continue to pay for inefficiencies.


          However, in the typical manner of Canadian agriculture politics, good and bad, is mixed together by (hmm, wonder which bright minds whips these things together) until it is a grey sludge that meets no specific criteria, nor seems to have the ability to respond and change rapidly to the needs of the day, then in a knew jerk last minute effort any progress will be lost. Our short term insurance model once a bill, died the same death before second reading.

          Let us hope that brighter minds prevail and this bill is tweeked, not scrapped, with a new protection system in place, (I know some prefer the clearing house model, but I prefer the simplicity and proven performance of short term insurance) and we do what must be done, eliminate uneccessary costs, where we can, and streamline those that we require.

          Let us hope it does not take another 20 years.

          Comment


            #6
            Private food inspection is a recipe for disaster. Grain is a food product in case you didn't know.

            Why do you think that governments got into food inspection in the first place?

            Answer: Because business wouldn't or couldn't be HONEST with the public. Standards were a hodge-podge and needed to be codified and enforced. Manufacturers and traders of food products used harmful additives, dyes, preservatives and sub-standard ingredients which were detrimental to the short and long-term health and well-being of consumers.

            Comment


              #7
              So, there is food inspection and it's government run and government trained and government paid....how come all the probs?

              And tell me about grain. if it goes straight from farmer to end user and both are happy....where is the prob?

              Comment


                #8
                parsley: The end-user may not have the equipment or the expertise to properly ascertain if the product is wholesome and not adulterated with some harmful ingredient, such as liquid grain treatment for seed-borne disease, etc.

                Such contamination must not enter the food chain. All it takes is one farmer out of 1000 to wreck things.

                Comment


                  #9
                  Kind of what happenened when the Government's Wheat Board's got a ship load full of Government 's CGC graded "deer poop", is that what you mean?
                  LOL Pars

                  Comment


                    #10
                    And here organics filled a niche market, throngs of people with full purses, who no longer trust Government inspected meat because Government inspectors allowed cattle to be fed big bags of feed made from ground up cows. Yum.
                    And your point is? ......

                    1. You want more of the same?

                    2. Or is your point "That happened a long time ago, and we've moved on",

                    3. or is your point,nothing wrong with cows eating dead cows, or any kind of cannibalism is okay as long as you bread it and deep fry it

                    4. Or is your point, consumers are 100% satisfied with government inspection and farmer retrospection and wilagro's introspection, that there is no such thing as an organic market?
                    Trust me wilagro, I'm devilish, tonight.

                    Pars

                    Comment


                      #11
                      Parsley; An imp for sure.

                      Anyway, I believe in government inspection versus private inspection. Business has been in trouble here and in the States with "company" oriewnted inspectors.

                      Comment


                        #12
                        I can respect your ideology, wil. What you believe in. At least you have one. and vote. And at least you care. Pars

                        Comment


                          #13
                          No other business has a government organization that forces companies to keep a line of credit for their accounts payables which is a huge expenses, especially when commodity prices are high and accounts receivables for most companies, unless you buy credit default swaps or have export insurance like Export Development Canada which will pay out 90% of receivables but it costs you a certain percent of the receivable.

                          The current grain situation in Canada has a lot of barriers to entry such as the bonding system which reduces the competition available in the market. Don't complain that there isn't enough competition when you want things like the CGC to have excessive bonding and grading requirements because we are likely paying for it already.

                          Also, only grain elevators, dealers, processors and terminals have to post bond, what about the many other people that buy grain such as feed mills, feed lots who buy grain? They don't have to be bonded and thus it is a double standard. They don't have to post bond while everyone else does, that is not fair.

                          I suggest that farmers learn how to manage their credit exposure like every other business in the world does and don't do business with any fly-by-night company.

                          Comment

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