One more possibility.
4) BC is unnattractive to major corporations. The medical and educational systems are greatly flawed. Regional transportation is a mess. (Hey, new bridges and RAV is not going to solve this one) Corporate head offices see transportation projects as expensive vote getters!

BC is a good place to visit, but not to live!

still another possibility.
5) Corporate head offices are looking for stability, in all ways. The recent political past of BC has seen pendulum shifts left-right-left-right-???. Business hates this sort of instability, just ask former Premiers Bill Bennett or Mike Harcourt. Both of them faced this problem when trying to get new businesses to move here; the constant response was,
"Let's see what the next election cycle brings..."

About the next election, I thought it would be a 'slam dunk' for Campbell, now I am not too sure.

BC Rail sale has backfired in the hurtlands. The promiced passenger rail service has now morphed into a dinner/breakfast tourist train from the NorthShore to Whistler. With prices well over $150, it is not a viable alternative to the the old 'Budd's'.

The fish farm disaster is looming large and unreported in the the Asper press is Alaska's and Washington State's growing alarm on our fish farm practices. This could soon blow up into a major international dispute.

The forest fire season could really add more fuel onto the fire of removing Campbell & Co., especially from the hurtlands, as the Liberals have done little to help.

The Olympic cost is spiralling way out of controll and if we have a warm winter or two, no snow, the venues maybe moved to other locals. (I saw just a week ago, between Baddad bombs and Lebanon rockets, a facinating piece on CNN, from Salt Lake City that Olympic officials were quietly seeking information on how quickly the Olympic facilities could be ready to host the 2010 event!)

If the NDP get smart and dump Carole James, to a real leader, who understands the political process, they may have a good chance to beat the Liberals.

Let's face it Carole, a.k.a. wet noodle James will never win any election and may well cost the NDP votes.

Who would want to locate a corporate head office in this looney bin of a province, where the poor are camped out on the streets and druggies and hypes from all over North America seem to come here. Crime is on the rise, despite the recent media stories. As I said befor, BC is a nice place to visit, but not a place to do business, unless you are in the drug trade!

Alberta continues to race ahead, the article says. Get rid of the stupid offshore oil moratorium and lets start drilling, simple huh? Anyways, most people on this site whine thier faces off about logging and mining, the majority of outfits on this list are into logging, mining and chemicals or related, like Finning. And many that are overlooked like Tolko, Washington Marine, Inland Kenworth etc, that are also dependent or into these industries. So people, whiners out there, what the fuk do you expect? Or want?

Grumpy and Murdock. I don't think either of you are zeroing in on the problem. 1. other areas of the world have left wing governments alternating with right and these economies are doing no worse or better than those that are permanently right wing. 2. Other areas of the world face similar neocon cut backs and resulting social problems, but this too does not appear to effect the overall economy to a great degree. There has to be some other reason or reasons.

Maybe head offices are not such a good thing. Maybe we should be thankful they are not locating here.

Climber, you and I seem to be able to discuss things in a reasonable manner right? Well, don't use snotty language like "whining" in reference to people concerned about the environment. You automatically put peoples backs up. They just have different concerns than you and the point is to find some way in which logging and mining can be done in a way that does not destroy the environment. If no compromise can be reached, well, we have to be left with the consequences which would be to find some other economic base. TANSTAFFL! (There Aint No Sech Thing As a Free Lunch)

Fair enough Anarcho. Wrong choice of words, I think my point is pretty clear though, don't you? And no, I think that most who oppose are preservationists, they want it all to stop. And logging and mining do not destroy the enviroment, they may harm it, but saying destroy is untrue.

It could be the 'high' cost of doing business here such as rent both for business and employees, combined with hidden costs which appear possibly to be graft and certainly is 'who you know' and who likes you in the gov't. All of which contribute to instability. Also, rather than the 'left/right' swing it may be the obviously ideological capriciousness (such as blatant disregard of the rule of law etc and other policy decisions that rival any banana republic) by the libs which will ultimately lead to trouble down the road.
This gov't is spending like a drunken sailor and not on services that benefit the public and traditional businesses that aren't in the business of exploiting either people or resources.
Eventually this inebriated plundering binge will end and people will be accountable. Provinces that haven't trashed their equity and entered into usury contracts with P3s will fare better than those who have squandered it.

Redrivergirl, of all the posts on this subject, I think yours seem to be the closest to the reality as they single in on those aspects of BC which are more unique to it - BC's mix of high rent, graft and political loonyness are all its own...

That's a very good point RRG, the high cost of housing for your employees can be a real deterrent when you're trying to attract people.

Climber, the fact is, just existing harms the environment in a sense. I think however, that past practices have, while not destroying THE environment, have badly damaged it and that this should be avoided in the future. As some one who became active in environmental concerns in 1971 and have had an interest it it since, I question your statement that most enviros want to stop all logging and mining. That is not what I find among the people I associate with, who as syndicalists are also concerned about the work force as well as the environment. What I would like to see is resource industries that worked to minimize the damage and I think this can be done. But we would have to move toward a more "European" sensibility in these matters and borrow some of their ideas. David Suzuki who is demonized by the right-wing as anti-industry, showed in the Nature of Things, how logging is done in a sustainable manner in Germany, and such logging was fine with him. What we need is a continuous dialogue between enviros and resource WORKERS (emphasis deliberate) to find mutually acceptable ways of resource extraction.

Thanks for your post anarcho. I don't think that there are too many 'environmentalists' out there who are so naive as to suggest that we should do away with resource extraction. It is not lost on us 'lefties' that we still utilize resources (paper, electricity, etc.)

Climber, whether or not logging or mining destroys or harms the environment is irrelevant. Just because "harm" is relatively more desirable than "destroy" does not make it OK. Also, Climber, I too appreciate your posts here - it goes to show that productive debate is possible without the mudslinging but I too get my hackles up when the left is accused of simply whining. Lets face it, both right and left can be accused of whining from time to time.

David Suzuki, I'm sorry, was he elected or is he like Bono? We have to get that wizened oracles approval? David Suzuki is opposed to clearcut logging, fact, He has tried his best to stop, not limit logging and mining in this province. B.C. is not Germany, we have are own unique situation. Little selective logging shows are not practicle here, we know how to log, Ingeniuos people in B.C. invented modern logging, equipment from steel towers to boom boats and the know how to do the impossible. Why should loggers and miners have to dailogue with and make compromises with enviros? They don't need to be told how to log or mine, Christ, haven't there already been enough compromises and new regulations, new laws etc.? I think this hostility to resource extraction, the urban consensus that its all bad, this maybe isn't making the province a friendly place for business?

Mr. McMartin fails to point out that the study he is citing is, by its own admission, an analysis of trends in big businesses only. The report says "Given that most enterprises in Canada are small, encompassing one production unit, most do not have separate head offices. Therefore, the analysis presented below includes predominately large, multi-unit enterprises."

In fact, this narrow analysis does not reflect what is happening widely in the economy nor does it provide any evidence, or lack thereof, of the success of the Liberal tax cuts.

Most would agree that the Canadian economy is driven by the growth of small business. For example, in a May 9, 2006 Federal Government press release entitled "Small Businesses Booming in Western Canada", the Honourable Jim Prentice, Senior Regional Minister and Minister of Indian and Northern Affairs said "Small businesses create jobs and are the backbone of our country’s economy."

As a small business person involved in the technology industry, I couldn't care less about what's happening to the Canadian head offices of large corporations. That's not why I, or my fellow entrepreneurs, favor tax breaks. We need a competitive tax regime to attract and retain management here in B.C. The vast majority of the people we care about are the founders and employees of small enterprises with a single head office located in B.C. They would not be counted in Mr. McMartin's data.

In fact, the effect of tax breaks on the growth of small business is where we get the leverage in this country because that's where real wealth, and jobs, are being created. In the technology industry for example, tax breaks are helping us to attract and retain world class talent so we can compete internationally and grow. Investment dollars follow these people (and favour lower taxes, too) providing the fuel to further accelerate the growth of our companies. This is creating thousands of new, permanent, stable jobs right here in B.C.

In the NDP high-tax era, our ability to attract talent and capital from outside Canada was abysmal. Since the Liberals took power it has become much easier and has contributed to the resurgence of our local industry.

Mr. McMartin needs to get himself out of the "branch plant" economy mindset that plagues all too many Canadians. To him I say "So what ... who cares if fewer large companies have their Canadian head offices in B.C.? Let's celebrate the vitality of an economy that is based on thriving home-grown businesses owned by British Columbians! The Liberal tax cuts are working!"

I'm a small businessman and Campbell's so called tax breaks had no effect on my business at all. The tax breaks were aimed at the upper class and the only effect I could see was, more holidays abroad for the wealthy.

Instead of taxes, we have user fees and reduced money for health and education. Please don't recite the Liberal mantra that we are spending more on health and education, they may be but the money is not going where needed. What I can see is bloated bureacracies in health and education.

We have a 'liar' government, elected soley on the account the previous NDP government was so incompetent. The Liberals are no different, just good spin from the Asper Press and the Libramercial programs on CORUS 98.

The Liberals can fool the local yokels, but they can't fool the out of towners. Why locate here? There is no real reason at all.

With today's technology, big business will locate where they think they can get the best bang for your buck and that aint BC!

Sorry techguy:

BC led the country in the formation of independent (small) business right through the nineties. Unfortunately,the tax breaks and deregulation have not been so much business friendly as they have been corporate friendly, and there is a very distinct diufference. I do wonder about the premice that the presence of corporate head offices is "good" as an earlier post noted. I am not as pessimistic as McMartin's article seems to be however I am concerned. While I don't think that the number of large corporate head offices present here is as much of an issue as what those firms are. 20 years ago, Boeing in Seatle seemed like a really good thing while there was the little shop across the lake in Redmond. Today Microsoft anchors a vibrant software industry in the area, & Boeing, while still very healthy has moved their head office. What is our Microsoft or our new industries? The present policies seem more focused on supporting existing industries (which M & A's are rendering more concentrated) without creating the environment in which new small/entrepreneurial/innovative) firms that will become like Ballard, QLT, Lionsgate, Questair, Helijet etc. can become established and grow.

No, no, moodyguy, I'M sorry.

The 90's were a disaster for business in B.C. Have a look at this presentation on the B.C. economy by a world-renowned economist (and Dean of the Sauder School of Business), Dan Muzyka from June of this year. It's posted on the School of Business website here: http://www.sauder.ubc.ca/faculty/directory/docs/icabc-presentation-bc-economy.pdf

Note (on page 15) that B.C. now ranks FIRST among provinces in terms of the proportion of GDP comprised on small business, 2004. On page 16 it shows that almost half of all jobs in B.C. were in small business in 2004. And the next graph shows that from 1999-2004 there has been strong growth from many of the small business sectors.

I think he summed it up pretty well on page 6:

In the presentation (on page 6) he says "The 1990's were a man-made economic (and therefore social) disaster for the province and people of British Columbia"

Don't argue with me... take it up with the Dean ;-)

The branch plant offices are included in these surveys as though they are "head offices" but they do not have autonomy and have to please their foreign masters.

Only companies that can make decisions on R & D, expansion etc...without having to phone the boss in London, New York, Hong Kong should be considered on the Head Office list. Sadly this would be a very short list as Canadian owned companies are falling like ten pins.

The corporate whores go where they can get the best deal. They're looking for cheap labour to manufacture their products and tax breaks to relocate their factories and offices. The fact that the none of the top canadian international/interprovincial corporations is moving their headoffice here just shows that despite the Campbell tax cuts we're still being outbid by other provices and jurisdictions.

It seems that the Campbell fibs aids basi etal started their own HomeGrown delivery CNR company.

http://bctrialofbasi-virk.blogspot.com/

How can this once great Province ever be anything more than a HQ for organized crime?
Campbell's house of cards will be history soon, but not soon enough!

techguy, have you looked at the numbers from BC Stats? The NDP had better growth in the economy than the previous Socred gov't.

As far as the comparison with the 80's goes I have yet to see anyone on the right declare Bill Bennett and Van der Zalm a disaster for the province.

Its instructive that your professor said "Read GDP growth per capita risen 28% in last two decades vs 42% in rest of Canada". Now why does he include the 80's to make the numbers look bad? Its because the Socred gov't had actual negative GDP years. Repeat, actual negatives. The professor just being a mite political perhaps?

Since the NDP left office the growth has been good but then low interest rates in the rest of Canada has produced similar levels of growth there and the commodity boom has also benefitted BC greatly.

Its also very easy to lower taxes when the feds are paying your bills which they were not doing here in the 90's.

Measuring head office count is a poor indicator. The biggest company in Canada is GM Canada - head office for Canada, sure, but c'mon. . .

The lowering of corporate taxes is but one necessary form of bait to attract foreign investment to Canada - and BC. I used to do this for the government folks, and worked on attracting many foreign high-tech companies to invest in Canada and BC for the government, and let me tell you that corporate taxes ain't the number one factor. But let me be clear, there is no universal number one factor - depends on what kind of business you're trying to attract and what their specific reasons for locating in a particular place is. The key is to find out what the hot button is and then focus on it. I don't some call center in BC - that's a sunset industry - give me some nanotech/biotech or high-end service industry that's not going to get off-shored in the next few months.

For some companies, it's access to financing - so here, BC loses out. We don't have a lot investment capital available here - not compared to NYC, London, Silicon Valley, Hong Kong - or even -gulp- Toronto. The only resources we really have are lumber, minerals and hydro - and guess what, those are the guys in the province, but that's because BC's where the lumber, minerals and rivers are. Duh.

But when it comes to other industries - aside from real estate which is a hugely mastubatory industry (your point is well-taken RRG) and tourism - what other strong industries are based here in BC? What else is "world-class"? Sadly, nothing else really.

But here's the thing, business is getting more and more location-independent and there are industries where PEOPLE MAKE THEIR WORK DECISIONS BASED ON QUALITY OF LIFE and not physical proximity to the factory or office. Vancouver has attracted a large number of such people - hell, the company I work for is in Toronto but I cover Asia Pacific so it doesn't really matter where I work. It's on this count that BC has competitive advantage, so let's attract these folks: the tech entrepreneurs, consultants, hedge fund managers, researchers, etc.

On the flipside, these same people find Vancouver - and BC by extension - to be interminably slow and non-dynamic(OK - maybe that's just me). I came-back to this place after working internationally for 17 yrs and let me tell you folks, if all my customers weren't elsewhere allowing me to travel frequently, I would've slit my wrists long ago. But it's great to hit that clean air when I get out of YVR after a trip.

BC has no industry and no clear future industry - maybe entertainment(but it's all "below the line"). When we dig-up all the zinc and copper, chop down all the trees and fish out our oceans - what then? What happens when the real estate market craters after the Olympics and destroys billions of dollars of wealth of average British Columbians who are all leveraged to their underwear buying condos at the top of the bubble? Maybe some Calgary-based oil-fattened private equity shop can pick-us up and take the province private, shake things up and then take us public again. . .

Also, I'm detecting a lot of old-think here about foreign companies and their foreign masters. Guys, it's the 21st century and we're in the post-industrial, globalized, interdependent world here.

You have to think - which is the more wise and long-term position wrt. attracting companies to set-up shop in BC: is it maximizing corporate taxation to fill-up government coffers so they can waste it on the Olympics? Or is to attract employers to set-up quality jobs and give BC a future?

Of course, these are not 100% mutually-exclusive, but folks need to take a long-term view. If the reasons for why a business invests in a location is compelling and sustainable then the business will not relocate, but will only increase its presence over time.

If we stop thinking of business in a Dickensian-sweat-shop way, but expand the definition to include knowledge-intensive industries where no one ever touches a cog, then we'd be surprised how relevant BC's innate strengths play to attracting companies to invest in BC: clean environment, PacRim location, multi-ethnic local population, decent schools and health care(or so foreigners believe), incomparable lifestyle, awesome quality of life.

Not all companies are engaged in widget manufacturing - and these are the industries BC needs to be targeting.

No they aren't since the real choice is whether we want Cdn companies employing Canadians or foreign companies employing Canadians. Since almost all but a smidgeon of foreign investment in Canada is not creating jobs but simply the takeover of existing companies there really is no benefit for us.

If the real choice included the one you listed

it would be a no-brainer. But since only around 3% of such investment is that type we have to compare it against the loss of control of the other 97% and decide if we're getting a good deal.

Frank - first of all, that's a knee-jerk, gross generalization. Toyota's $5B dollar investment in Ontario did not take-over any local companies but represents greenfield investment, for example.

But let's say that you are right - why can't we try and change this percentage? It's like looking at unemployment, or inflation, or infant mortality, etc. and saying - jeez, that's bad but we can't do anything to change it so let's give up and let what happens happen.

Screw that. The fact is that Canada, like other countries, lives in a global economy and that we need to compete. Why the absolute resistance to non-takeover foreign investment in Canada? Does it matter to you that all of our nationally-branded beers are now owned by foreign companies from Labatt to Sleeman? I still drink Canadian beer because the companies still employ Canadians in Canada. Almost half of the cars driven in the USA were made in Canada - more than Toyota and Nissan combined. If there was no Auto Pact, then could Canada have built a car company that could have achieved these volumes and created so many jobs?

So then - the alternative to attracting foreign direct investment is building world-class companies in Canada and BC. Hey, I'm ALL for that - but succeeding on this count takes time, skill, aggressiveness and scale. It's VERY hard - and again, competition is the name of the game. Global scale is virtually impossible to achieve in Canada alone -we're just not big enough domestically as a market, so there is no choice BUT for globally-oriented Canadian companies to go global and buy companies in other countries. I assume that you're all for that, right? As long as it's Canadians buying companies in other countries - or does that upset you, too, because they'll employ people in other countries? Let's not be hypocritical or greedy here - it cuts both ways.

It would be great if we had a Microsoft and Boeing or other world-leading home-grown Canadian enterprise, but sadly we don't. We have Corel and Bombardier.

And that's in large part to the general attitude in Canada about "going for the bronze" and not wanting to compete all-out and go global in a big way. Those Canadian entrepreneurs or businesses who do, are usually labelled too "American", so they usually decamp and go to the USA, like all of our entertainment stars - and let's face it, big business in Canada ain't exactly a segment of society loved by the average Canadian. . .

In the end, if we want more and better future-proof(or future-resistant) jobs, then we need to do both - attract foreign investment AND develop domestic business: it's not an either-or. Finally, given the liquidity in global markets, how "Canadian" is a company based in Canada, anyway, when anyone with money can buy stock in a Canadian company listed on a stock exchange? Hell - China "owns" a huge chunk of the USA by holding their debt - it's all fluid and national ownership is an outdated concept. It's a new world Frank - deal with it.

Well incredulous, it does matter. And the little bit of beer I drink comes from a local micro brewery; I buy bread from a local baker, produce from a farm gate producer and meat and chickens from a local producer too. Eggs and milk and cheese too whenever I can.

My coffee is imported but roasted and ground by a BC company; I refuse to use a debit card because I noticed my bank started laying off workers as soon as they became popular. I still buy all my gas from Petro Canada even though I'm appalled that the government has sold off 'my' interest in the company.

I try to buy Canadian made clothes and shoes as well and I avoid foreign products whenever I can. I never shop at Walmart. On principle.

I'd be happy, and I bet more average Canadians would too, if a lot of us started going for the bronze again. I don't have any sympathy with companies like Barrick Gold or Brascan who exploit foreign workers and ruin 'their' environment and then bring their ill gotten gains here to start business schools at U of T so the University can pretend it is a world-class institution.

Most 'foreign investment' people are so enamored with comes from Canadian banks - we should be building our own country and not trying to attract idiots who are only here for the short run and quick profits.

I’d sooner see small healthy self-sufficient communities throughout the country and no more world-class dumps like Vancouver where, as you yourself acknowledge, the air is foul and hard to breathe and the eyes are the eyes of the hunted.

Your post is nothing but a slightly more polished version of Cappy's philosophy.

Its no such thing, its just a stat the Globe and Mail was talking about a few months ago.

You're arguing with a straw man now since I wasn't saying the 3% was a bad thing. I don't know why you assume I think it is. I'll happily go on the record and say, I'm quite happy with the 3% of foreign investment in Canada that produces jobs.

Well I didn't compile the stat, it was a Stats Canada figure quoted by the Globe. And yes I'd be quite happy to see that number increase.

Are you sure you need me here to argue with you? When did I say we should give up? I think we should reverse the trend by returning to the pre-Mulroney days of FIRA and make sure foreign investment that doesn't create any jobs and is simply a takeover of a Cdn company passes a review.

Again, argue with what I write, I write quite a bit, you don't need to make up stuff, there's plenty of what I actually do write for people to disagree with.

Yes it does.

The auto-pact is not something we could have acheived in the era of globalization. It is what? About 40+ years old?

And preventing their takeover by bigger fish as soon as they are successful enough that they attract attention.

No it isn't, its because successful Cdn companies can be easily taken over and therefore they become a part of a bigger foreign company. How do you propose to build a successful Cdn company like Microsoft or Boeing without blocking their takeover?

Strangely this last line of yours sounds like it comes from someone who doesn't believe in fighting and instead believes in giving up.

Its not a new world incredulous, its the same old world with the same economic system and the same problems.

Barney Frank in the NY Times recommends a book on the 19th century robber-baron days as the best book to read to understand the here and now. Same old same old.

Yep, it's another gilded age!
Mark Hanna would be right at home.

Frank - yes, you are correct - apologies for mis-reading your position.

So we agree that raising the 3% of non-takeover FDI is a good thing. The 97% of remaining FDI based on takeover of a Canadian company is not a good thing in your opinion. While I'd like to see more balance between the two, I come at it from a different perspective and I don't necessarily agree that foreign companies taking over Canadian ones is bad in and of itself from a job creation point of view.

It seems that your resistance to foreign companies taking-over Canadian ones is based on the premise that foreign companies will do. . . what? Why is this bad?

Is it because you believe that foreign acquirers will lay-off workers, shutter facilities and strip the acquired company of all its value and then leave it bleeding and weeping on the side of the capitalist freeway? Yeah, that'll happen in some cases, but are foreign companies any worse than domestic acquirers? Will an Ontario company treat a BC company better than an American one, or Japanese or French? Don't know - that claim is hard to prove.

Here's what I do know though - there was a little company here in BC called Distinctive Software that made computer games. They got bought in 1991 for $11M by California-based Electronic Arts and have grown to over 1000 full-time employees still in Burnaby where they were founded - damn robber barons.

Then there's this company called PMC-Sierra in Burnaby that used to BC Tel's R&D arm but got bought by an American company called Sierra Semiconductor back in 1984. Now PMC-Sierra is a NASDAQ-50 company and has grown to almost 900 employees in BC(Sierra is gone and the merged company is based in Canada). Yeah, that really sucks.

Then there was this other Vancouver company called Crystal Decisions that got bought by Paris-based Business Objects for $1.2B - they're over 1200 employees now and are taking up more space in Yaletown than the condos are.

Of course, I could go on with Vivendi Universal buying Vancouver's Radical Entertainment and growing it, same with Rockstar Games buying Barking Dog also in Vancouver, Flickr bought by Yahoo, ActiveState bought by Swedish Sophos, Kelowna's Workfire bought by Packeteer(US), blah-blah-blah-blah. . . look - there are many cases where foreign acquirers do not do evil things to poor helpless Canadian companies.

See a trend? These are all knowledge-based industry companies, ie. high-tech. In the new business world, the ONLY value a company has is people. These days, companies get acquired for the talent/people that write the code, sell the stuff and deliver the product - instead the product itself. Pretty revolutionary, eh?

It's also usually the case when the acquired Canadian companies are strong, have world-class talent and competitive advantage. Yes, it would be great if all of these companies above could have IPO'ed on some exchange so we could've bought their shares and owned parts of some real Canadian success stories. As it is - we can buy shares in Yahoo or Business Objects - and participate this way. And that's my main point - it DOESN'T matter anymore where acquiring companies are based. In the above cases, the acquiring companies invest MORE money into the local economy and retain if not create MORE jobs in BC.

That kind of acquisition FDI I can live with - and that's what usually happens in tech. It ain't always this way - ask the people who worked at Abatis Networks in Burnaby after they got bought, but then their whole industry was in the dumpster.

So, Frank - that 97% ain't all bad. . .

My last line about getting with the new world is not a capitulation, but a realization of the new ground rules and adaptation to the new environment. When confronted with a changed game, one has two choices: cry foul and sit-out and lose the game; or adapt to the new rules and try and get out on the ice and beat the other guys. "Whaddya mean the two-line pass is legal now?!?!" Are you going to continue playing by the old rules or adapt? Unfortunately, this is not a game we can afford to sit-out and lose.

Yes

True

I would like to see the numbers much less lopsided. I don't have an ideal figure in mind, even 97% in our favour would not be good either, as I'll explain. If 97% of foreign investment was creating jobs it would say our economy has real problems generating jobs on its own. The fact that only 3% of foreign investment is doing this speaks well for our ability to create our own jobs and therefore our own wealth.

My concern is that any nation where foreign investment reaches levels that can best be described as foreign takeover that nation can be viewed as more a colony of that foreign power than as a trade partner. When you add to that the fact that to this day so much of our wealth is derived from the extraction of resources for the markets of the same nations that buy up our most productive companies then I think it reinforces the view of Canada as a colony no different than our relationship to Britain or France in the past. To quote an old phrase, it means we are not masters of our own house.

Repatriate profits from our resources and labour without putting anything back in to make up for it. When a Cdn company is taken over it means not only are the decisions about our resources and labour made outside the country (which is bad enough) it also means the profit derived from those resources and labour is lost to us. When a colony receives income from the sale of its resources it needs to make a profit and reinvest that profit back into the country or it will never escape its colonial status.

No, as you say, domestic companies can do the same thing. A difference is that domestic companies benefits from a strong domestic market and therefore care about laid off workers here. Foreign companies using our labour to extract our resources don't care what our domestic market looks like because they don't sell to it. Therefore, when possible, I prefer decisions about Cdn workers and resources to be made in Canada.

The examples you put forward on the knowledge sector are all well and good, but what does Canada gain from the profit of its knowledge workers going to some other country?

Did the workers at Distinctive Software for example become more knowledgeable after they were taken over? EA is not in the business of providing charity, they took over DS because they were successful and believed they would profit from their ownership of it. If EA's Burnaby operation didn't make money it wouldn't remain open. So in that sense its no different than a takeover of a BC forest company.

The product is the code. No one yet has ever paid for the box, they want the finished code. Whether the profit of a company comes from a worker coding software or a worker cutting a tree its the same relationship, workers create a product and the company sells that product.

But why doesn't it? Where do you see the relationship being different? Software coding is perhaps even less safe from foreign competition than cutting trees is, since you can't easily move a forest as easily as you can move your coding farm from Burnaby to Austin, TX.

I agreed at the top that the 97% isn't all bad, it reflects the fact we're successful. However, Canada doesn't profit from our success, foreign ownership does. Which means the software coders might as well be selling beaver pelts as all Canada gets out of it is the price of their labour. The profit will leave the country.

If the guy that owns the other team also bought your team then it doesn't really matter who wins, your team won't benefit either way, you're just playing for your own paycheque.

Techguy,
Thank you for the presentation, it was a good one and actually to a large extent supports my point. Incidently, Dean M provides no support for his statement regarding the 1990's being a man made disaster other than the 20+ year decline in productivity. My concern, actually highlighted in the Dean's presentation is that rpoductivity growth, export, and increase in GDP have all been driven by a boom in commodities. The labour productivity in non resource based areas, where many small businesses are found is very low. In addition, we are dependent for export on the US (not totally bad) but worse than this is what we are exporting-commodities and we are currently in a high point of the commodity cycle. If Dean M had looked further back, he would have seen that our small business growth is the continuation of a trend that has been occuring for years. I concur with his concerns on the concentration in the resourse industries and I am very concerned that we are increasing our reliance on these areas and not making it easier for entrepreneurial ventures, particularly in the non-traditional industries which were represenrted by some of the firms that I named, to thrive in BC.

Incredulous, Couldn't agree more with your first post. Hpoe that we can overcome this circumstance though.

And here we come to the crux of the argument: no real company(not just EA) is the business of charity - that's why there are -um, charitable organizations run as non-profits. Non-profits being the operative term as opposed to profit-driven, which would mean regular business, small, medium, large, etc.

Frank, no company - whether owned by Canadians or people from Mars (though I hear the Venutians are anarcho-syndicalists) would keep a campus/facility open if it were losing money for long - this destroys profits - that thing you're so concerned about.

Yet again I point to the fact that ownership is no longer national. Just because a company is based in the USA, it doesn't mean that its ownership is American. You see, there's this apparatus called the stock market, and on it, companies sell little pieces of themselves known as "shares". These "shares" represent ownership of equity in the company. If someone owns enough shares, then they own the company.

Often in VERY large companies with global operations, the mix of ownership of these companies' shares is VERY complex. Sometime entities called hedge funds, private equity funds, other companies - or really, really rich people who live in faraway lands buy large numbers of shares in a company - thus controlling, or in effect "owning" them. But the neat thing is that ALL of the shareholders are in effect "owners" of the company, and they are the ones who benefit from the profit made by that ASIC verification engineer beavering away at PMC-Sierra in Burnaby. Oh, but guess what - that ASIC engineer also owns "options" or shares in PMC-Sierra so he(it's usually a guy sadly), too, is actually an owner of the company -albeit much smaller than Megatron-Cyclops-Humungoid Partners LLC based in Greenwich, CT.

So since ownership is complex, usually quite distributed and NATIONALITY-INDEPENDENT, your thesis of profit flight out of Canada from foreign owners is not completely valid. Indeed, one could argue that many Canadian companies are ALREADY owned by foreign owners who have bought their stock on the open market.

But you see, Canada is not alone - EVERY country must deal with this same situation - though some are not as seriously affected as others - but the pace will only accelerate and ownership even more transnational and the economy more interdependent.

So Frank, let the Finns, Swedes, Russians and even the Americans play on our ice - in the end it makes for a richer game for everyone.

Frank - one more thing, it would seem that you don't understand the tech industry at all. Yes, the product may be code in the case of software, but far more valuable are the people who architected, wrote and then verified the code(though this last group is usually the smallest). Google buys companies JUST to obtain skilled people, as did Microsoft with Ray Ozzie.

I know it's tough for you to understand because you may believe business is still all about factories, widgets and foul-mouthed foremen - but it ain't the case in high-tech. The highest line item cost for software companies is payroll - not equipment, not facilities, but salaries of their people. In the end, that's really all they have - so it isn't like beaver pelts. Bad comparison.

Incredulous
It may not be like beaver pelts, but, your high tech hero entrepreneurs will source the people where they can get them cheapest - education and talent doesn't just happen in North America. A few Canadians may be chosen, but, the operative strategy is to cut costs, always costs and they’ll go to India or China or wherever to do that.

The high tech talent in India, or China, is as competent as the talent in America. This is a race to the bottom, no matter how you slice it.

Interestingly enough the error rate in much of the most elementary radiograph analysis done in India is far higher than the same activity performed in the US; and, parenthetically, the error rates are still lower in Canada where much of the analysis is done within the public system.

Commodifying talent is no better than commodifying people.

Back to my point:

Yes, Alcibiades & Incredulous, companies will source talent people from the cheapest source but good talent is actually much more scarce than is assumed. Our resouces should focus on development and maintenance of talent and a welcome environment for talent in BC, regardless of the field. I am concerned that we still seem too commodity focused which will not serve us well in the long term

incredulous,

I'm aware of the stock market, I think it was mentioned in the back of an economics text I might have perused one day. Unfortunately I have to tell you that stock markets were not just invented recently. Nor does their existence mean repatriation of profits from Canada doesn't exist or should be ignored. Perhaps when we live in a borderless world and we all pay our taxes to the United Nations it won't matter, until then, where profits go matters greatly to people like our finance minister, the Bank of Canada, our commercial banks, the business sections of newspapers etc. We would all be well advised to care as much as they do. After all, StatsCan doesn't track that data because Frank in BC might like to read it.

Actually that wasn't the crux of the argument. We weren't arguing over whether companies should try to make profits.

Stay respectful incredulous... I've stated my profession many times here on the Tyee, I just don't think its relevant to this discussion.

Yes, and trees are important but far more important are the people knowing how to maximize the amount of board-feet of lumber you get out of them. The tech sector isn't the only sector in the world to require people to be more than beasts of burden. I realize you work in the industry but surely you aren't telling me that microeconomics doesn't apply to the tech sector?

Unfortunately its not as different as you are telling me.

Was it? My comparison was not about saying killing beavers and writing software is the same job, its just the same end result. The thing about economics, and I realize you've never studied it, is that the text books don't care what the employee produces. The reason is because it doesn't matter. Nor is the tech sector the first industry where wages exceed other costs.

On what basis do you make this broad claim? I've worked in tech for the past 12 yrs and with engineers in India and in China, as well as with engineers in Silicon Valley, Europe and Canada - there are many, MANY talented engineers and developers in India(software is not as strong in China, but every chip ever made will soon be made there), but it's still most of the lower-level stuff that's done there. This will change within a decade to be sure - but is a fact now.

I'll tell you why, because software is not a tedious, assembly-line endeavour: it's highly creative, rigorous and something where an expert can produce more than 10 non-expert developers.
It takes time to create advanced expertise in technology - it isn't like dropping a pulp factory next to some logs and pressing a button.

I didn't think I was being disrepectful by stating that you do not understand the tech industry. There are a great many, MANY things that I don't understand - but I'm not really one to go around pushing an uninformed opinion (unless it's at a bar and I've had a few too many - mea culpa) - and if I'm caught out of my depth, then I'm be happy to get called on it. Though it still stings. . .

And for the record - I think this is first time we've tangled, so forgive me if your reputation doesn't proceed you: what is it your profession.

Also, speaking of respect

I could ask the same courtesy from you as you've asked from me.

Moodyguy - I don't agree. I've worked in attracting FDI to Canada for the government and have spoken to and worked with many large, foreign tech firms who do NOT look for cheap labour: they look for access to markets, existing local markets, access to talented empoyees, business & social infrastructure.

Every tech company I ever brought over to visit BC had at the top of their agendas: visit the universities and colleges to see about new employees, look at housing, education system, social infrastructure, talk to customers who are already based here(if applicable), and gov't sweeteners like the SR&ED tax credits for R&D performed in Canada - cheap labour, was close to the bottom of the list. Companies aren't stupid - if they want cheap labour, they know better than to consider Canada.

Exactly. I threw that in there to drive home the point that one doesn't have to belittle the person you're talking to. I prefer a conversation that doesn't degenerate just because we disagree.

As for my profession, well, mainly, I've been coding software since before the TRS-80 appeared. Ran my own software company and have since branched out somewhat using the money I made from software development in the so-called Research Triangle of Raleigh-Durham. Coding-wise I've been on both sides of the management equation and found life to be much better away from the programmer farm of a large windowless room with all of us separated by little carpeted cubicle walls and constantly checked on by our managers to see what new code we had produced that day. Its easier and cheaper to get coders nowadays than it used to be. Which is why you see surveys showing kids aren't interested in it as a career the way they used to be unless its making the new version of Doom.

Cool - then you DO know what you're talking about. . . ah, the TRS-80, fond memories. RTP - not so fond memories. Apologies if my comment sounded belittling - that wasn't my intention. That's my second apology to you - so I don't mean any offence.

So then - having run a software shop and being in the biz for so long, you understand the value of talent. Let's get to the heart of the matter then IMHO, why is that you think we cannot produce great, world-class tech companies in Canada - while other countries can? RIM seems to be our only champion now that Nortel is severely diminshed.

Is it really the Bay Street crowd that inhibits us from fostering great, world-beating companies, or rather a lack of ambition to try and go for businesses that scale globally? How can we change this - or is this something you think we need to change?

Sorta, but then again the "tech sector" is an awfully big place and I don't claim to have wide knowledge of it. I have a deep understanding of my area, and a superficial understanding of the rest of it.

I didn't think it was, but its easy to do on here, I wish I could go back and retract a lot of my own statements of the past.

Yes, which is why a 25 year old C++ coder who leans back on his chair all day and sits on the internet isn't worth half the pay of the single mom at the convenience store who knows the biz inside out.

I honestly believe that innovation lives here. We do a fine job of starting companies, my only problem, as you know, is that whenever we do something right we get taken over, as your earlier list demonstrates.

To start up I had to pay an interest rate of 15% from a vulture because a bank wouldn't lend me the money.

The financial sector of this country has always been the problem, if you wanted to do anything besides resource extraction, focused as they are on the US.

YES! Absolutely - it irks me so much when the gov't keeps pushing this whole Innovation Agenda. That's not our root problem - Canada and the Canadian tech business have never had a problem innovating - EXECUTION is the problem.

I lived and worked in Silicon Valley for 5+ yrs - and Canadian engineers/talent were easily on-par or better than folks from Bangalore or wherever - and this is a recognized fact. Canadian employees have good "brand" - we have good schools and enough talent.

What we don't have in BC and Canada in general is access to plentiful venture/risk capital, top-notch sales & marketing, and related infra like lawyers, accountants, PR, et al. that make the difference between being picked-off for a few million by some bigger company, and a Google, for example.

In the end, it isn't about the technology, as you know, it's about the stuff done before and after the code/chip ships, aggressive growth and getting scale through customer wins, sufficient funding and momentum in the market. Now that ATI has been bought by AMD, and Nortel is a shadow of its once mighty self, who do we have anymore? RIM?

I think where we diverge, though, is how we address this. Having worked in government, I've seen firsthand how policies designed to protect and foster such companies can destroy what we need to grow. As imperfect as the market is, I have more faith in it than I do in our gov't.

That's a friggin' tragedy, I agree - no wonder you hate the banks 8)

Yes, by and large the financial community in Canada is backward, too risk-averse and a major obstacle to building world-class companies in Canada.

So, how about foreign investors then 8)?

incredulous, I have to agree-

I became focused on labour only and my point was that labour is not equal, talent and innovation varies immencely. However, labour is only one element in the investment decision for an organization.

hehe

Yes it probably is where we diverge, I've never worked in gov't, except for the army. But I don't want hand-holding, I just want FIRA to have some teeth and decide if a takeover is good for us and turn it down if it isn't. That's not that different from the policies of other countries who face the same issue.

There is no reason for a place like BC to be dominated by US corporations in everything from lumber to retail as if we were living in 1880's India. I'd prefer if things like Terasen, for example, had remained Canadian. I'd feel better if most of the Canadian workers chopping down Canadian trees for the US market and fighting the US in court weren't foreign owned. And as you mentioned the stock market, its not impossible nowadays to impose limits on foreign ownership like 40% or something. Let foreigners invest in Cdn companies but prevent them from taking over our best companies and dominating entire sectors of our economy.

There is a simple way to make it easier so companies will remain Canadian. You don't need a vast bureaucracy. Pass a single, simple law democratizing shareholding. One vote per shareholder no matter how many shares they own. It is unlikely that small shareholders would want foreign takeovers. With the present feudal system of running corporations a handful of the biggest and therefore richest shareholders make the decisions. They don't care what the effects upon the community, the workforce or the little shareholders are, just so long as they can make big money.

I guess those with money would stop investing, woudn't they anarcho?
That would be great.
Nobody investing.
It's easy to see where you are coming from.
You want to destroy our society.

You're like a dog Ron, marking each thread.

If you're an exemplar of society there isn't much left to destroy is there? Thank God you're not.

So democracy is a bad thing. Democracy = destruction of society. Exactly what every brown shirted seig heiling SOB has always claimed. We know what you really stand for, Ron.

I know you guys will miss me but please no tears :-)

The family and I are outta here for a vacation. And being as I try to buy local I'm vacationing on a beautiful BC island. I'll think of all you Tyee regulars while I'm on a sunny beach building sandcastles with my daughter, I just won't think of you much :-)

I'm no economist, so I'm in good company here. No one has mentioned that the FP 500 is based on revenue not profit . Toronto can have all money losing companies they want, we'll take the 20 person company whose employees all make 6K a year, the game engineers, the CRM designers, the intellectual capital. They can have a few well paid executives exploiting all the loop holes, with all of their underpaid administrative assistants, mail room junkies, paper stackers, and phone answers. We only have so much office space downtown, why waste it on dinosaurs.

The loss of FP500 head offices at first seemed like a huge deal, but when you look closer at it, it really doesn't mean much at all. The indicator that I would be concerned with would be profit versus employees, salaries, and the governments bottom line which isn't attracting the biggest but the best. (And there is little money in corporate taxes anyways, you want the shareholders and the +50K workers, not the office space)

The NDP did a fairly poor job, but the Liberals are a bird of the same feather with a better PR team. Neither understands the tax then spend mentality of WAC. (Instead we've gone from borrow and spend to sell and spend) The Liberals have done a good job overall for are economy, not by policy, but by telling us they've been doing so in the last 2 years. The funny thing about the economy is the only thing that really matter is consumer confidence, for a right wing party the Libs are doing fairly well, unlike the bozo to the south who think that telling people to buy plastic sheeting and ducktape is going to spur on growth.

Anyways, don't expect head offices to come pouring back no matter who's in power. There's no office space for them, and if there was, then f*%! the other indicators, thats when we'd have a problem.

I don't understand this statement - what employees in these fields make 6K/year. Do you mean 60K/yr?

Anarcho,

Shareholders - small or big usually make the same proportionate amount of money - it all comes down the number of share one owns. Do you mean that someone who owns 1 share should make the same return as someone who owns 100 shares?

Incredulous. I don't know how you could possibly put that interpretation on what I wrote. One vote no matter how many shares you own. Just like a credit union or coop. This is called democracy. In no way this effects your return on your investment or makes the return on one share equal to 100. To do what you suggest obviously would not work. Coops and credit unions would have never flourished with a policy as naive as that.

Sorry, incred, 6 figure..

Have a good Holiday Frank..

Nuthin` better`n sandcastles with a daughter...

I remember being at a beach near comox with my 8 year old daugter and two nieces some years back..the tide was out..and the sands were festooned with geoduck sp? holes...the nieces would quickly dig and grab the clam by the neck..the clams would resist and the necks would break off...my daughter was horrified and asked them to stop...they said "but theres millions of `em"
My daughter said.."yes and theres millions of us too"
I knew at that moment that she was gonna be alright.
Have a good one Frank..Woody Allen said
" Young daughters are the saviours of the world"

No kid'n btc - we used to do much the same thing at Parksville, time was.

Enjoy Frank - it'll soon be gone.

btw Frank, that last post (hidden decoder ring) on the poverty thread was classic.

Hey Grumpy

While the transit system does need improving here, transportation it is no worse here than anywhere else. A recent study showed commute times in the Vancouver area are about the same as they were 10 years ago while commute times for other Canadian cities have increased dramatically.

Here is a quote from the Stats Can study:

Not surprisingly, the average duration of the round trip for workers living in the largest cities is longer than for workers living in smaller communities. For example, the average duration of round trips for workers living in the metropolitan area of Toronto is 37 minutes longer than for workers living in urban areas with populations under 50,000.

The longest commute was indeed in the metropolitan area of Toronto, where commuters took an average of 79 minutes for a round trip, or roughly 340 hours in a work year, or two solid weeks.

For people in Montréal, the round trip took 76 minutes, up from 62 minutes in 1992, the equivalent of 2.5 extra days a year.

In fast-growing Calgary, the round trip took an average of 66 minutes, 14 minutes longer than it did in 1992.

In Vancouver, however, workers spent virtually the same amount of time getting to work in 2005 as they did some 10 years earlier. Vancouver commuters spent 67 minutes in transit in 2005; 68 minutes in 1995; and 70 minutes in 1992.

http://www42.statcan.ca/smr04/2006/07/smr04_20506_04_e.htm

McMartin and y'all have missed the main reason for the corporate tax cuts. Howe street told the Gordo:

Sure we'll pay your election expenses (100 million and counting) and we will make sure you and your cabinet and party buddies will have high paying fancy corporate jobs on leaving politics (just like former flight instructor now corporate CO Gary Collins) but in return for our largess we want our payback up front!!!!

Cut the taxes now!!!!

climber:

And harming the environment, with its concommitant extinction of species that cannot take the change, may also lead to the extinction of the human race. But the planet would still be here. You comfortable with that?

tech guy:

We don't live in a vacuum. Check out the previous decade world wide, and it's cascade effect on the BC economy in the 90's......

Depending on how you look at it, Canada or suffers from its proximity and open access to the US markets and its own unique characteristics. Canada doesn't have a big enough population to support the success of many industries. Japan was able to succeed at auto manufacturing because it had enough domestic demand for autos and the Japanese govt erected protectionist walls to nurture the industry. And then took them down just in time to establish very competitive plants in the US.

Canada never enjoyed these kind of historical circumstances and benefits. Having ten times Canada's population gives the US lots of economic advantages in terms of scale and finance. It's pointless for a high tech company that's globally successful to remain in Canada- their big market is in the US and you have to be close to your market and bankers. RIM is different as their owners insist on being in Canada and their type of service is fungible over borders. And Electronic Arts- the only reason they're in Burnaby is head office in CA bot a studio owned by Canadians who wish to remain in Burnaby. Plus, Canadians are cheaper to employ than Americans in the coding of games. Americans don't call Vancouver "Mexico North" for nothing.

Bobbyperu,

I don't fully agree with you. It seems that your main points are still based on traditional industries, eg. your HQ needs to be close to your customers.

In some industries, notably in the tech industry, physical proximity to your customers at the HQ-level is simply not necessary. Taiwanese companies build 70% of every PC & laptop in the world yet they are ALL based around Taipei while ALL of their factories are based in China yet ALL of their customers are in the USA (Dell & HP). I'm not even going to bring-up software or ASP's that deliver their products as services over the web. It really doesn't matter from a logistics or distribution perspective where a company's HQ is located.

Where it does matter where your HQ is located is in areas like taxation, access to capital and human talent - and VERY importantly, wherever the senior management & board want the company to be based for whatever reason, which very often is for sentimental reasons. For world-class companies though, it doesn't really matter where they're based because the world comes to them.

Incredulous, world class companies are world class because they deliver products relevant to peoples's lives. To do that you need some sort of presence in these mkts. In the case of Dell and HP, they both have a huge presence in the USA. Yes, all their notebooks and hardware are built in China, but the subcontract manufacturing part is easier than the selling part. Knowing the US consumer and computing trends is more important and you need a US presence in that particular business to do so. Someone has to tell the Chinese factories what to make.

Ironically, Incredulous- and I'm kidding aside here- I thought computing was now a traditional industry.

It's a fanciful idea to think the world will come to you if you simply have a better product. You need the right vencaps, marketing, timing, luck, banking advice..so many things besides a better product.

Vancouver's problem in attracting all these elements is that it isn't a city or society that admires, envies rich successful people. Decades of left leaning socialism mean most Vancouverites despise the rich. You need reasons for "clusters of competence" to arise. Investment bankers, tech wealth lead flashy lifestyles and need chic places to party. And Vancouver is well known to Americans as the "no fun" city run by aging hippies who try to impose a collectivist vision on everyone, wanting to run everyone's lives. So in Vancouver, we have a socialist establishment that pimps the poor by allowing the homeless to shamelessly parade themselves about. Even in NYC and San Francisco, these kind of people are out of sight and out of mind.

Vancouver is reluctant to pay that price to become a world class high tech, world class whatever center. It's that vacillation and Canadian wishy washiness that drive more aggressive, smarter Canadians down south.

What a waste of time and money. Governments chasing after big business has been a boon for businesses looking for tax breaks to maximize profits.

Governments undercut each other and run themselves into the ground while business laughs all the way to the bank.

Just say no to big business. Help local people and small business and to h*** with the stacked game.

We've been played as suckers for too long.

"So in Vancouver, we have a socialist establishment" One more illiterate who takes his political advice from Fox News. Words have meaning. How often do we have to point this out? Vancouver is no mre "socialist" than Seattle or Portland. A couple of times it has had a mildly reformist social democrat alliance in power, but socialist, regretably no.

Anyone, anywhere, anytime, who uses the locution 'world class' ought to recognize that it renders the relevancy of whatever else they have to say moot.

It should always appear in quotation marks because it is a meaningless aphorism and invariably a cruel lie trotted out to hide the soullessness of something else the person who uses the term is not willing to acknowledge about their philosophy. The only thing ‘world class’ about the world is the world itself and that too is a tautology.

BobbyPeru,

I am actually in violent agreement with you on this. I recall the Greatest Canadian series on CBC a little while ago and was disheartened to see that not one business leader was ever mentioned, though they had created whole industries and created hundresds of thousands of jobs.

In the USA, I'm sure Andrew Carnegie or Bill Gates might have been mentioned if not on the list, but in Canada as a whole I think we have an entrenched culture that believes that if one is extraordinarily successful, then you must have screwed the people. I don't think Canadian businesses are any more rapacious than their American counterparts, but it's our Canadian value system that does not see business as a positive contributor to society. Let's also remember that ALL big business started out as Small Business.

If you read my posts, you'll also see that I didn't disagree that proximity to funding, marketing expertise, etc, or the ability to execute is important. But if you look at examples in India and China, where there was FAR less of this sort of infrastructure, you wonder if proximity to these resources is a showstopper - it shouldn't be. It only is if we allow to be.

The main problem is a spirit of competitiveness and focus on trying to build world-beating companies. That's what we're missing as far as I believe: the faith(some might call it stupidity) that your little company could grow-up and be a world-leading enterprise.

Ah yes, world leading like Enron, Global Crossing, Adelphia, World Com, Dell, Imax,
General Motors, Walmart, Krupp-Thyssen, Archer Daniels Midland, Riggs Bank, BCCI, BNL, Bayoil....I could go on. And on. And on.

Sometimes you have to look at the details of these company migrations to see whether all the selfserving corporate complaints about taxes and regulations are the relevant variables. In many cases they have nothing to do with the company's action.

For Terrasen, the headquarters leaving BC came directly from the Liberal privitization initiative - a corporation-friendly policy. No hydro spinoff to make the budget look better and that head office would still be here.

In the case of CREO, it was a promising hi tech company with innovative products, but management embarked on a large acquisition of an israeli company, then a spin -off of their software, which both turned sour and lost the support of their shareholders. So the company went on the market, and most capital for this is outside of BC. The plant and employees mostly stayed. Again the driving forces were not tax policy or housing costs.

Our jurnalists have to learn to cut through the drivel of selfserving justification. These policies have only an indirect effect on the individual actions, but a very direct one on our taxes and social values.

Most of the emotion in the arguement in BC against cutting individual and corporate taxes displays an undercurrent of "hating the rich", "hating the Man", "hating multinationals". There's no rational reason, only brainwashing over the decades by Canadian socialists. Now, some come on this board and ask since when was BC truly socialist. It's really all relative, isn't it? I don't mean socialist like USSR or Cuba, but certainly left of the political middle especially in terms of business policy. Your avg Canadian is more liberal than Americans on social policies, but more to the middle than the NDP on economic policies. And that's why the NDP has trouble winning elections. And even when it does win, it just takes one despot like Glen Clark and a cabal of left wing loonies spouting left wing drivel to turn off the public. If those on the BC left learned nothing from the NDP's brutal beating in the polls they will never learn.

Someone once said that Canada has created "a culture of envy". That is, we hate rich successful people and want to take their stuff. We want to vilify anyone and any company. At best, the Canadian left doesn't mind you being rich but only if you run through the same gauntlet that Jesus did in "Passion of the Christ". Funny, I think we're run by the same hippies I saw in that rock documentary, "Festival Express" who fervently believed that musicians should play for free. Nothing is for free.

But, Vancouver and its people have tonnes of potential and intelligence and energy. It's the people who run this city and province- bureaucrats and politicians who are holding us back and making it a "no fun city". Big cities are brawling, challenging, noisy, boisterous and lovely and cultural all at once. Vibrancy is excitement is what attracts talented people to cluster in one place. Instead, we have a core group in Vancouver that thinks that people will come here to watch birds shit on rocks and a stand of trees.

You’ve got to be kidding. When have the rich in this country ever run through any kind of gauntlet?

When they start paying the same taxes that wage earners do for every dollar they earn - no matter how - I'll start to listen.

Until then, the rich have nothing to complain about - the system is stacked in their favour and that's why there is virtually no upward mobility in this society and child poverty is still a horrendous problem. The only vibrant rich guys I've ever seen were high on drugs.

I don't envy the rich, I pity them. One day, when we have real deomcracy in this country they'll have to work for a living too.

More "great" news about the race to the bottom this morning: Weyerhauser and Domtar are merging.

There will be redundancies.

The author states:

He fails to mention, however, that Alberta corporate and personal rates are the lowest in Canada. Could this have something to do with Alberta's results in attracting head offices?

If BC still had some of the highest tax rates in the country, as was the case during the NDP time in office, would we have lost even more head office jobs?