Martin's Pants Appear on Fire

The PM's been asked again and again about how he runs his shipping firm. Why does he keep mangling the sad facts?

By Murray Dobbin 29 Dec 2004 |

Murray Dobbin is an author, commentator and journalist. He is the author of five books and is a former columnist with Financial Post and Winnipeg Free Press. He is a board member of Canadians for Tax Fairness and on the advisory council of the Rideau Institute. He lives in Powell River, BC.

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Does Paul Martin have a pathological aversion to telling the truth? When it comes to his shipping company it seems Mr. Martin believes he can simply deny the facts and continually get away with it. And so long as reporters asking the questions haven't done their homework, he is probably right.

In an interview with the new prime minister on December 19th, Mary-Lou Findlay, host of As it Happens, asked Mr Martin about his image problem with Canada Steamship Lines,  specifically CSL's foreign flagged ships. Called flag-of-convenience ships (FOCs) they allowed Mr. Martin (and now allow his sons) to pay a quarter of the Canadian wage rate, avoid paying taxes altogether, and to ignore Canadian labour standards, health and safety laws and environmental regulations. Experts in the field estimate that each ocean-going ships saves on average $700,000 a year from this unethical practice.

Sweatships? Who me?

Mr. Martin's response was the same as it has been over the years when challenged on his part in this rogue industry: deny, deny deny. He told As It Happens "Five hundred of [CSL'S] over 600 employees are Canadian. The vast majority - the overwhelming majority - of its ships fly the Canadian flag."

Yet this flies in the face of numerous investigative pieces done on CSL - including a meticulously researched investigation by the CBC television program Disclosure. In a one hour documentary on CSL last spring, Disclosure revealed "Today, Paul Martin's family business has expanded into a global empire. In Canada, CSL owns eighteen ships which fly our flag. It employs 500 Canadians, and pays Canadian taxes. CSL also owns, in whole or in part, eighteen foreign flagged ships, sailing around the world, from Montreal to Melbourne."

In other words, half of CSL's ships are FOC ships and half are Canadian-flagged. How does 50 percent become an "overwhelming majority?" Easy. Mr. Martin simply refers to CSL Inc,  based in Montreal, and tosses in the ships owned by CSL Asia. He neglects to add in the ships owned by CSL International, based in the United States, and conveniently leaves out all those ships that CSL co-owns with other international shipping companies and those that it leases and reflags as FOCs.

Try and follow the flags

It's not the first time Mr Martin has cynically misled the public about the sleazy side of CSL. In 1996 he was asked by Montreal Gazette reporter Jules Richer about his foreign flagged ships and how many he had. Mr Martin's reply? "The last I looked it was about 90 per cent of CSL ships that are registered in Canada.'' But even CSL's vice-president Pierre Prefontaine told the same reporter that only 12 of the company's 17 ships were registered in Canada. That is, 70 per cent.

When Martin answered the question, he also knew, from his regular "Blind Management Agreement" briefings about major decisions made by CSL, that it was building two more ships for delivery in 1998 and 1999. Both of these would be registered in the Bahamas. In other words, rather than 90 percent of Martin's ships being registered in Canada, the figure was 63 percent -- and getting steadily smaller.

Sounds like we'd all do well to keep an eye on the length of our new Prime Minister's nose.

Murray Dobbin is a Vancouver author and journalist whose latest book, Paul Martin: CEO for Canada? published by James Lorimer is in BC bookstores now.  [Tyee]

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