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Will Niagara Falls Become The Northern Vegas?

By David South

Id Magazine (Canada), May 16-29, 1996

Niagara Falls – Niagara Falls has always been a town that attracted big dreamers with even bigger schemes. The beauty of the Falls has intoxicated many with grand ideas. Towards the turn of the century, the inventor of the Gillette safety razor, King Camp Gillette, tried to transform the American side into a Utopian paradise, planning to house most of the US population in a community of beehive-style high-rises covering an area 135 miles long and 45 miles wide.

Given the long history of grand schemes to remake both sides of Niagara Falls, it is hard not to see the hyperbole surrounding the planned casnio, slated to open by the end of the year, as another over-hyped dream. Just as Gillette spoke of untold riches, the government-owned Ontario Casino Corporation also sees Utopia ready to be born at the edge of the Falls. As provincial tourism minister Doug Saunderson said last month, “The casino and tourist development will provide Niagara with a kick start into the 21st century… I believe they will move Niagara to the very top of the list of destinations for world travellers.”

Those expectations sound even more impressive if you believe the government’s estimates for job creation. In a city of 76,000, the government projects between 3,000 and 9,000 jobs will result from the casino and its spin-offs. With numbers like that, it is hard to find many people who will say no.

Everywhere in Niagara Falls’ tourist district roads are being ripped up. Tourists from New York, Japan and Quebec tread through the clouds of gravel dust to see the Falls. But it isn’t just the government which is dreaming big for Niagara Falls.

Three dreams are fighting in this town for the hearts and souls of its residents, and depending on your perspective, have their merits. One, a scheme being championed by a group of local church leaders, is to build a wholesome theme park based around the exploits of local heroine Laura Secord during the War of 1812. Another more flamboyant scheme that has been on and off again since 1993, involves building a $1.4 billion theme park dedicated to transcendental meditation. So far, the casino is winning hands down.

The casino on its own is helping to raise another dream, phoenix-like, from the ashes. In 1979, the DiCenzo family built Maple Leaf Village as a joint shopping mall/theme park attraction. Now it sits derelict, waiting for renovations by the Buttcon construction company to turn it into the temporary site for the casino.

The run-down Maple Leaf Village, with its old-world European facade resembling a castle, became known for tacky attractions like the JFK Assassination Museum, the Elvis Presley Museum and the Nightmares Therapy Centre.

Judy MacCarthy has fought plans to build a casino since they were first discussed. She helped put together a coalition of church groups called the Try Another Way Committee. MacCarthy’s dream involves a theme park extolling the virtues of Laura Secord, whose claim to fame was snitching on the American invaders, having them ambushed by Indians near Niagara Falls.

MacCarthy says the provincial government has shown some interest in the project, even sending officials from Toronto to meet with her.

As for the more ambitious transcendental meditation theme park, it looks as if the whole project hangs on securing enough funds to get it off the ground.

In 1993, Maharishi Veda Land’s chair, the effervescent magician Doug Henning, told the media that Niagara Falls had to make up its mind: choose between the transcendental theme park, with its centre-piece floating bridge, or the moral decadence of a casino.

Three years later, what many thought to be a project even less tangible than Henning’s metaphysical musings, seems to still have some life left. Tucked away on the 13th floor of a Bay Street office tower in Toronto, Maharishi Veda Land Inc. – Enlightenment, Knowledge, Entertainment – continues to run with a handful of staff. As three office workers scatter behind closed doors, a secretary tells me the theme park is still a go, but refuses to give any more details. But MVL has told a Florida newspaper it isn’t going to build a theme park on property the company owns there.

Ted Cook, the former vice-president of PCL Eastern, the construction company Henning contracted to build the park, says there was a change in attitude: “Henning’s position softened as time passed (over the casino). He became less opposed on moral grounds, and it was now ‘maybe we can make it work’.”

If there was an epicentre to the Niagara dream machine, it is the office of its mayor, Wayne Thompson.

Dean Iorfida is the mayor’s executive assistant. For Iorfida, the casino is a matter of turning a seasonal economy dependent on summer-time tourists into a viable year-round attraction. Even when they do come to Niagara Falls, he says, the average tourist’s stay is just four hours.

Iorfida is dreaming large, imagining the permanent site will include an auditorium, convention centre and amusement park. “Vegas has gone that way,” he says.

But he also wants to see the whole city transformed by the casino. “We have to spread it around or you get a black hole effect: too much in one location.”

As for the complaints that the casino will only add to the tacky reputation of Niagara Falls, Iorfida believes “the city doesn’t want anything that turns people off, but we can’t stop private enterprise. We are talking about one location, I don’t think it will be like Vegas where casinos try to out-garish each other.”

Many associated with the traditional tourist attractions in Niagara are banking on seeing some of the casino cash. Merchants on Clifton Hill, “The street of fun at the falls,” are hoping they can complement the casino rather than compete.

So far, the tourist trap, despite the shabby strip of Clifton Hill with its wax museums and fudge shops, or even the block after block of cheap hotels and motels, has been able to avoid turning into a seedier form of sleaze – it is still a family atmosphere. In fact, the declasse’ tone of the city hides an impressive stability and prosperity that makes the residents of Niagara Falls, New York jealous. For many opposed to the casino, it is this stability that is at stake.

Overhead is the dayglo pink and turquoise marquee of the Movieland Wax Museum, where one can see wax likeness’ of such luminaries as Jim Carrey. Guy Paone, the general manager of the museum, says he is happy about the casino, hoping it will bring year-round business.

“We get families down here,”he says. “If dad wants to go to the casino, then mom and the kids can come here.”

Paone isn’t expecting any business from the die-hard gamblers though. “The hard-core gamblers didn’t come here any way. You know how it is – in Vegas some people don’t eat or sleep.”

As for some of the doom and gloom about increasing crime scaring off the family tourists, Paone doesn’t buy it. “We are pretty tight on petty crime here. I don’t think the casino will affect the family reputation.”

Paone does have a sobering thought he leaves me with, “we are the suicide capital.”

All the hope has already spawned new jobs teaching the unemployed how to gamble. Frank Cricenti, black jack course co-ordinator at the National Casino Academy, joins a growing number of people employed in the lucrative business of teaching the unemployed casino skills. According to Cricenti, casino schools “are just popping up.” At government employment centres, staff are anticipating more than 100,000 applications to flood in chasing the 3,000 jobs being offered. Such a yawning chasm between expectations and reality means times are good for the adult education business.

At the 47-room Cataract Motel, the casino is an excuse to spiff the place up. “We have painted and renovated the rooms so that they look like they’re brand new,” says the motel’s manager, who will only give his name as B. John.

Other property owners are banking on the casino rescuing them from the slump. Eva Klein of Klein Developments, wants to especially unload her pricier properties. “There has been a little bit of change in the rental market, some casino people are moving into town,” Klein tells id. “We’ve had a high vacancy of higher-end rentals in Niagara Falls and we’re expecting these to be filled by a new influx from the casino.”

For Niagara Falls, the casino looks set to turn the city into a smaller, more Canadian Las Vegas. For a city desperate for more work, that doesn’t sound too bad. For the provincial government’s travelling road show, the next stop is to move the existing Windsor casino’s management over to staff the new casino at Niagara Falls.

Casino Calamity: One Gambling Guru Thinks The Province Is Going Too Far

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CASE STUDY 3: Id Magazine | 1996 – 1997

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2021

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CASE STUDY 3: Id Magazine | 1996 – 1997

Expertise: Editing, investigative journalism, art direction, managing teams, strategy, content development.

Location: Guelph, Ontario, Canada 1996 to 1997

Features Editor: David South  

Click here to view images for this case study: CASE STUDY 3: Id Magazine | 1996 – 1997 Images

Abstract

In 1996 I was hired as Features Editor for Id Magazine, a bi-weekly alternative magazine in Guelph, Ontario, Canada. 

About 

In 1996 Id Magazine, an Ontario, Canada alternative biweekly, was expanding and needed to improve the quality of its journalism, while also making the difficult shift to being a more consistently professional offering. I was hired as Features Editor and set about swiftly assembling a team of investigative journalists. My strategy involved targeting stories overlooked by Canadian newspapers and TV news. In the 1990s, it was often the case the best journalism and the best investigative journalism in Canada could be found in the country’s alternative media. This led to a number of firsts, including an extensive investigation into Canada’s flourishing sex industry, the government’s addiction to casinos to boost revenues, unearthing a plot by neo-nazis to infiltrate Ontario high schools with hate rock, university students’ catastrophic debt culture, reporting from the streets of Port-au-Prince, Haiti on Canada’s UN mission, and probing the government’s public services privatisation plans (including being invited to debate this topic on CBC TV’s programme, Face Off). 

There clearly was a gap in the news marketplace Id could better fill with solid investigative journalism and features writing aimed at a younger demographic. 

How large a market gap can be confirmed by various analyses on the state of the Canadian media at the time and since. According to the book The Missing News: Filters and Blind Spots in Canada’s Press (Robert A. Hackett and Richard S. Garneau, Canadian Centre for Policy Alternatives, University of Toronto Press 2000), Canada’s media was in a mess in the 1990s resulting from declining resources, staff layoffs and media closures reducing the breadth and depth of news coverage.  

My challenge: Could I bring together a talented, young team and improve the quality and consistency of journalism for a start-up magazine seeking to grow? The proof came in the form of improved audited pick-up of the magazine by readers, the magazine’s confident push to expand on the Internet, and the fact many from that original team have gone on to not only have successful careers in the media and film, but also to be influential in their own right – proof the original belief in their talent was correct.  

Pressure on journalists to toe the line and not upset advertisers was also increasing in the context of ongoing high unemployment, a stagnant economy in a recession, and government austerity. Canadian media as whole also has a “great dependence on advertising, which accounts for more than 70% of daily newspaper revenues, about 64% of magazine revenues,” which means there is enormous pressure to only publish stories that do not upset advertisers. And monopolies exert great control over news content in Canada: “In the United States, ten companies control 43.7% of total daily newspaper circulation. By contrast, in Canada since 1996, one single company controls a comparable share of the media pie.” 

Quoting Jeffrey Simpson in the book, newspapers are “shrinking in size, personnel, ambition and, as a consequence, in their curiosity,” …. “I believe the result has been a diminution in quality.” (p64) 

Fast forward to “Today, we have a crisis in the journalism industry unprecedented in scope. A media implosion. Newspapers being reduced to digital editions, large numbers losing their jobs, circulation falling, ad revenues plunging, near monopoly ownership of big-city dailies, the old business model in a state of collapse.” (Canada’s media: A crisis that cries out for a public inquiry by Lawrence Martin, The Globe and Mail, Feb. 02, 2016). 

Brief descriptions of sample issues are below: 

Can Harris be Stopped? Cover 

My first Id Magazine cover. It was thrown together in a few days after being hired. While a work of resourcefulness under pressure, it did capture the spirit of the times as multiple demonstrations and strikes tried to bring down the much-hated Conservative government in Ontario. 

“Can the UN Help Remake a Country?” Cover 

This cover photo by Phillip Smith was taken in the market area of Port-au-Prince, Haiti. I had never seen such squalor and desperation in my life. It got worse as we visited the city’s morgue, packed to the rafters with the dead and mutilated bodies of children and adults. It was a tough assignment and one that was captured with professionalism by Phillip’s camera.  

Christmas Issue Cover 

Back in 1996, the Thatcher thirst for privatisation came to Ontario with a vengeance. In this issue, we asked if it showed a lack of imagination to just sell publicly paid for assets to wealthy investors. We offered other ownership models and I debated this topic on CBC TV’s Face Off.  

“Pulling the Plug on Hate Rock” Cover 

This excellent cover by Gareth Lind was, as far as I know, the first use of pop art on a biweekly magazine cover in Ontario at that time (I certainly hadn’t seen anyone else do it). It sold the excellent investigation into skinhead rock bands infiltrating Ontario high schools very well. It was timed for release during the North-by-Northeast music festival in Toronto, and had zero returns (as in all issues were picked up). 

Sarah Polley Cover 

A regular contributor to Id, Canadian actor and director Sarah Polley challenged the stale Canadian left with her spiky views. In this issue we tackled the decline in the quality of TV programmes and asked if it was a moral vacuum being hoovered up by consumerism.  

Student Issue Cover 

This cover is by great Canadian political cartoonist and illustrator Jack Lefcourt. Always funny, Jack captures well the corporate take-over of the country’s universities and the introduction of the catastrophic debt culture that leaves so many students in a financial pickle. It was also Id’s first student issue.  

“The Great Education Swindle: Are Reforms Destroying Your Future?”

“Today’s Sex Toys are Credit Cards and Cash” Cover 

As Ontario’s economy experienced year-after-year of high unemployment and stagnant salaries, its sex economy flourished. In another first, the Id team tackled all aspects of the growth of the sex economy and changing attitudes to sexual behaviour. Beating the big papers to this story, they wrote with honesty and verve and made a refreshing break from the limp journalism of most Canadian newspapers. 

Timeline

1996: Hired as Features Editor and assembled editorial and creative team.

1997: Id Magazine begins to simultaneously publish its content online, a pioneering move at the time. 

Impact 

Micro 

  • reducing returns and boosting audited pick-ups of the free magazine – a key metric for a publication reliant on local advertising
  • assembled talented investigative team and graphic design and photo team
  • introduced pop art front covers
  • increased news coverage, especially impact of austerity in Canada
  • increased foreign coverage, including on Canada’s United Nations mission in Haiti
  • introduced high-profile contributors, including actor and director Sarah Polley
  • debated stories on other media, including CBC TV’s Face Off 

Macro

  • most of the team have gone on to very successful careers in the media
  • magazine still receives good comments on Facebook many years after its closure
  • one of the first Canadian magazines to embrace the Internet and publish simultaneously online

A sample of published stories is below:  

Casino Calamity: One Gambling Guru Thinks The Province Is Going Too Far 

Will Niagara Falls Become the Northern Vegas? 

Land of the Free, Home of the Bored 

Man Out Of Time: The World Once Turned On the Ideas of this Guelph Grad, But Does the Economist John Kenneth Galbraith Know the Way Forward? 

Porn Again: More Ways to Get Off, But Should We Regulate the Sex Industry? 

Redneck Renaissance: A Coterie of Journalists Turn Cracker Culture into a Leisure Lifestyle

Swing Shift: Sexual Liberation is Back in Style 

State of Decay: Haiti Turns to Free-market Economics and the UN to Save Itself 

TV’s Moral Guide in Question – Again 

Citations 

Schizophrenia: A Patient’s Perspective by Abu Sayed Zahiduzzaman, Publisher: Author House, 2013 

Other Resources 

Freedom of Expression: Introducing Investigative Journalism to Local Media in Mongolia 

Ger Magazine Issue 1 

Ger Magazine Issue 2 

In Their Own Words: Selected Writings by Journalists on Mongolia, 1997-1999 (ISBN 99929-5-043-9) 

The back issues of id magazine reside at the Bibliothèque et Archives Canada / Library and Archives Canada [has v.5(1995)-v.8(1999)] collection.

OCLC Number/Unique Identifier: 1082496695

ISSN: 1208-4476

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2017

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CASE STUDY 1: Investigative Journalism | 1991 – 1997

Expertise: Investigative journalism, editing, start-ups, content and magazine design, digital content, digital strategy.

Locations: Toronto and Guelph, Ontario, Canada and London, UK 1991 to 1997

Investigative Journalist, Editor, Reporter, Writer: David South

Click here to view images for this case study: CASE STUDY 1: Journalism | 1991 – 1997 Images

Abstract

I worked as a journalist for magazines and newspapers from 1991 to 1997 in Canada and the United Kingdom and as a radio host for a weekly spoken word interview programme, Word of Mouth (CKLN-FM). 

CKLN-FM’s “Word of Mouth 6 pm-6:55 pm Hosts: David South, Jill Lawless This show goes well behind the headlines for the real story behind the events.”

This included working as an investigative journalist for Now Magazine, “Toronto’s alternative news and entertainment source”, as a Medical and Health Correspondent for Today’s Seniors, and as an investigative journalist and reporter for two Financial Times newsletters, New Media Markets and Screen Finance.  

Samples of published stories can be found here (below) and on the Muck Rack platform here:https://muckrack.com/david-south

About

Could it be possible to do high-quality investigative journalism in the context of a shrinking economy undergoing austerity, and where the media sector is contracting and consolidating around a small number of media companies? Is it possible to launch new media products in the face of a contracting economy and reach new audiences and create new markets?

In Canada, the early to mid 1990s were the years of government austerity and economic crisis. After the crash of 1989/1990*, institutions came under great stress. Health care, for example, was pitched into a period of turmoil and change. Drawing on my experience working in the health sector (Princess Margaret Hospital/Ontario Cancer Institute), I covered this crisis in many stories for various publications, in particular Today’s Seniors.

The Canadian economy severely contracted and unemployment was at 11.4 per cent by 1993 (Statistics Canada), and as Statistics Canada says, “Because employment recovered at a snail’s pace after the recession of the early 1990s, the decline in the unemployment rate was delayed until 1994”. 

The media in general could not avoid the wider economic crisis. According to the book The Missing News: Filters and Blind Spots in Canada’s Press (Robert A. Hackett and Richard S. Garneau, Canadian Centre for Policy Alternatives, University of Toronto Press 2000), Canada’s media was also in a crisis throughout the 1990s, as declining resources, staff layoffs and media closures reduced the breadth and depth of news coverage. Canadian media as a whole also has a “great dependence on advertising, which accounts for more than 70% of daily newspaper revenues, about 64% of magazine revenues,” which means there is enormous pressure to only publish stories that do not upset advertisers. And monopolies exert great control over news content in Canada: “In the United States, ten companies control 43.7% of total daily newspaper circulation. By contrast, in Canada since 1996, one single company controls a comparable share of the media pie.”

The impact of this crisis was summed up by Jeffrey Simpson in the book The Missing News, where he said newspapers are “shrinking in size, personnel, ambition and, as a consequence, in their curiosity,” …. “I believe the result has been a diminution in quality.” (p64)

This is the context in which, ironically, it was possible to flourish as a much-sought-after investigative journalist who could get the story and get the quotes and as an editor. And it was also a time for opportunity, in particular as new media rose in importance, from cable and satellite television, to the rise of the Internet.

I broke original stories for Now Magazine as a member of their investigative reporting team, for Today’s Seniors as its Medical and Health Correspondent, and as a reporter for two Financial Times newsletters in London, UK. I also broke original stories as a freelancer for many other magazines and newspapers, including Hospital News, The Toronto Star, This Magazine, The Annex Gleaner, Flare, The Financial Post Magazine, Canadian Living, and others. I drew on strong contacts in health care, media, politics, international relations and the military. 

I was an editor for magazines, newspapers and newsletters as well, gaining invaluable experience and contacts. This included as Editor-in-Chief for start-up youth publication, Watch Magazine (see Case Study 2), and as Features Editor for Id Magazine (see Case Study 3). 

Themes covered included the uses – and abuses – of data, the impact of military engagements to uphold international law, how to re-structure health care when budgets are tight, with populations ageing, and technology and scientific advances quickly expanding options, the emerging new media world of cable and satellite television and the Internet, the sexual revolution 2.0, urbanization and how it re-shapes politics and community, international development, and youth culture. 

Story highlights include covering data concerns over Canada’s border screening measures, questions about the air quality of aircraft cabins, the debate over airstrikes in Bosnia, scandals involving peacekeepers in Somalia and reporting on the UN peacekeeping mission in Haiti, reforms to medical education in Canada, innovators in health care, the tug of war over health care spending during austerity measures, London, UK designers, the growing role of Nordic countries in cable and satellite television, the film financing scene in Europe and the UK, the new sexual revolution and its impact on cable and satellite television and the rising Internet, changes to Canada’s media industry, and Toronto’s embracing of the megacity concept and the political battles it sparked. 

I edited newsletters and newspapers aimed at specific communities, from Canada’s medical history community to part-time students. And had the privilege of helming a start-up youth magazine as its Editor-in-Chief to its commercial success (see Case Study 2). 

It was an exciting time of great change, best reflected by the fact in 1997 Id Magazine (Features Editor: see Case Study 3) was one of the first Canadian publications to regularly publish an online version (https://web-beta.archive.org/web/19970207103121/www.idmagazine.com).  

* “The last two recessions in Canada occurred in 1982 and 1990. … The most recent Canadian recession began in the second quarter of 1990 and over the next 12 months GDP fell by 3.2%. … The recovery from this recession was unusually slow; there was almost no growth between mid-1991 and mid-1992. This slow recovery was export driven.” (The Canadian Encyclopedia)

 “In early 1994, Canada’s economic situation was not that favourable—our economy was facing some rather serious problems.

 “… the recession here was more severe than in the United States.

“Working their way out of these difficulties was disruptive and painful for Canadian businesses. Defaults, restructurings, and downsizings became the order of the day. With all this, unemployment took a long time to recover from the 1990–91 recession and, in many instances, wages and salaries were frozen or reduced (Bank of Canada: Canada’s Economic Future: What Have We Learned from the 1990s?)

A small sample of published stories with links is below:  

Investigative Journalism 

An Abuse of Privilege?

Aid Organization Gives Overseas Hungry Diet Food

Artists Fear Indifference From Megacity

Casino Calamity: One Gambling Guru Thinks The Province Is Going Too Far

Counter Accusations Split Bathurst Quay Complex: Issues of Sexual Assault, Racism at Centre of Local Dispute

False Data Makes Border Screening Corruptible

New Student Group Seeks 30 Percent Tuition Hike

Peaceniks Questioning Air-raid Strategy in Bosnia

Safety at Stake

Somali Killings Reveal Ugly Side of Elite Regiment

Study Says Jetliner Air Quality Poses Health Risks: CUPE Takes on Airline Industry with Findings on Survey

Top Reporters Offer Military Media Handling Tips

Will the Megacity Mean Mega-privatization?

Will Niagara Falls Become the Northern Vegas?

Health and Medical

Changing Health Care Careers a Sign of the Times

Critics Blast Government Long-Term Care Reforms

Cut Services to Elderly, Says Doctors’ Survey … But Leave Our Salaries Alone!

Feds Call for AIDS, Blood System Inquiry: Some Seniors Infected

Government Urged to Limit Free Drugs for Seniors

Health Care on the Cutting Block: Ministry Hopes for Efficiency with Search and Destroy Tactics

Health Care in Danger

Lamas Against AIDS

New Legislation Will Allow Control of Medical Treatment

New Seniors’ Group Boosts ‘Grey Power’: Grey Panthers Chapter Opens with a Canadian Touch

Philippine Conference Tackles Asia’s AIDS Crisis

Private Firms Thrive as NDP ‘Reinvents’ Medicare

Psychiatric Care Lacking for Institutionalised Seniors

Seniors Falling Through the Health Care Cost Cracks

Specialists Want Cancer Treatments Universally Available

Take Two Big Doses of Humanity and Call Me in the Morning

Taking Medicine to the People: Four Innovators In Community Health

US Health Care Businesses Chasing Profits into Canada

Magazines

The Ethics of Soup: Grading Supermarket Shelves – For Profit

Freaky – The 70s Meant Something

Land of the Free, Home of the Bored

Man Out Of Time: The World Once Turned On the Ideas of this Guelph Grad, But Does the Economist John Kenneth Galbraith Know the Way Forward?

Oasis Has Arrogance, A Pile of Attitude and the Best Album of 1994

Porn Again: More Ways to Get Off, But Should We Regulate the Sex Industry?

Redneck Renaissance: A Coterie of Journalists Turn Cracker Culture into a Leisure Lifestyle

Safety at Stake

Swing Shift: Sexual Liberation is Back in Style

Time Machines

Too Black

Media 

The Big Dump: CP’s New Operational Plan Leaves Critics with Questions Aplenty

Channel Regulation: Swedes will Fight Children’s Advertising all the Way

Do TV Porn Channels Degrade and Humiliate?

Is the UK Rushing to Watch TV Porn? 

Playboy ‘is not for sad and lonely single men’

TV’s Moral Guide in Question – Again

UK Laws on Satellite Porn Among Toughest in Europe

Undercurrents: A Cancellation at CBC TV Raises a Host of Issues for the Future

Special Reports

From Special Report: NMM (New Media Markets) Spotlight on the Emergence of Satellite Porn Channels in the UK

From Special Report: Sexual Dealing: Today’s Sex Toys Are Credit Cards & Cash: A Report on the Sex-for-Money Revolution

United Nations

Freedom of Expression: Introducing Investigative Journalism to Local Media in Mongolia

Starting from Scratch: The Challenge of Transition

State of Decay: Haiti Turns to Free-market Economics and the UN to Save Itself

Traffic Signs Bring Safety to the Streets

Magazines

Watch Magazine

Id Magazine

Newsletters

Hannah Institute for the History of Medicine

New Media Markets

Screen Finance

Blue Sky Bulletin

Other Resources

Ger Magazine: Issue 1

Ger Magazine: Issue 2

In Their Own Words: Selected Writings by Journalists on Mongolia, 1997-1999 (ISBN 99929-5-043-9) 

Mongolian Rock and Pop Book (ISBN 99929-5-018-8) 

Wild East: Travels in the New Mongolia (ISBN 1-55022-434-4)

Timeline 

1991: Begin career as investigative journalist and editor.

1992: Work as a Medical and Health Reporter for Today’s Seniors and as an Investigative Journalist for Now Magazine. Work as Editor and Writer for the Hannah Institute for the History of Medicine’s newsletter. 

1993: Published in many publications, including The Toronto Star, Canadian Living and This Magazine.

1994: Work on re-launch of Watch Magazine 2.0 and its expansion (see Case Study 2). 

1995: Work as reporter for two Financial Times newsletters in London, UK.

1996: Work on re-launch of Watch Magazine 3.0 and its expansion. Begin work at Id Magazine as its Features Editor (see Case Study 3).

1997: Begin two-year assignment with the United Nations mission in Mongolia (see Case Study 4). 

Testimonials 

David South … proved himself to be a penetrating, thorough and hard-working journalist. He produced a lot of very good stories …” Neil McCartney, Editor, Screen Finance, Telecom Markets and Mobile Communications, London, UK

This work is licensed under a Creative Commons Attribution 4.0 International License.

ORCID iD: https://orcid.org/0000-0001-5311-1052.

© David South Consulting 2021

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Province For Sale: Step Right Up For An Opportunity To Buy What You Already Paid For

“This is not being driven by fiscal or ideological motivation, though that may seem funny.” Conservative advisor James Small

By David South

Id Magazine (Canada), December 12 to December 26, 1996

It is looking more and more like the Conservative government will launch a massive privatization campaign by the middle of next year. And it is becoming clear how key government assets such as Ontario Hydro, liquor stores and public broadcaster TVO will end up in private hands. The prevailing ideology of key advisors to the Harris government, including influential financial heavyweights at Canada’s top underwriters, is leaning towards a free-for-all where the highest bidder will win. 

To date, the government has been coy about its plans, occassionally making vague threats that certain services need to be “looked at.” Assets that could go on the block include road maintenance, jails and the Ontario Clean Water Agency. In August, the government appointed former banker Rob Sampson as the minister for privatization. His days as vice-president of corporate finance at Chase Manhattan make him a popular candidate with the suit, tie and blouse crowd on Toronto’s Bay Street. 

While Sampson is so far surrounded by only a handful of advisors, the plan is to create a privatization agency that will supervise each sell-off after getting the go-ahead from Cabinet. 

Sampson’s policy advisor James Small, sums up the government’s attitude: “This is not being driven by fiscal or ideological motivation, though that may seem funny. We can do better for less, even though that may sound trite.”

The government’s taxpayer-is-always-right attitude means it believes the best option is to float the newly privatized companies on the stock market, letting the highest bidder win. 

“We have sophisticated investors in Ontario,” continues Small. “[Privatization] is not driving us to expand shareholders in Ontario. Can we, as taxpayers, benefit? What will give the best results. It is not ideological. In Canada we have a consumer culture and a very mature social structure. The market will determine what people will pay for things. We didn’t get elected to sell the family silver.

“There has been 16 years of this happening. But is Margaret Thatcher the way to go? One of the advantages for Ontarians is that we can pick and choose the best approach. It’s difficult to point to one part of the world, one way we could provide better service.”

Shareholder Democracy

A concept popularized by British prime minsiter Margaret Thatcher in the 1980s, shareholder democracy actually saw the light of day in British Columbia back in 1979. Then, premier Bill Bennett embarked on an ambitious scheme to give every citizen of the province, including children, five shares in the British Columbia Resources Investment Corporation, a mining and logging company. Out of a population of 2.4 million, 2.07 million applied for the shares. While that idealistic experiment eventually failed as a series of bad deals pushed the share price down and arrogant executives pissed people off, it was a bold initiative. 

Similar schemes have been used in Eastern Europe to increase private ownership in the economy. 

But it is looking more and more like the government is going to try and avoid even a semblance of giving Ontarians a fair shake, by selling shares on the stock market to whoever can afford them. While the NDP and unions are opposed to privatization for some very good reasons, they are missing out on an opportunity to push the government to divide the shares up amongst all Ontarians (not necessarily a big stretch for the NDP, who brought us toll highways). 

Shareholder democracy has developed two broad – and opposing – interpretations. For the left, a shareholder democracy in its truest sense is public ownership. For right-wing idealists, it means a nation of share owners playing the stock market with all the aggressiveness and greed of free-market capitalists. 

Like any ideal, the reality is far more disappointing. Any small-time stock holder will tell you about arrogant CEOs and board members not listening to them. Ask any Ontarian on the street, and they will tell you about arrogant and incompetent civil servants who aren’t listening to them. 

There is a more radical and fairer approach to privatization that would suit the populist rhetoric of the Conservatives. It involves selling shares along the lines of WWII war bonds. This solution would satisfy left-wing concerns the rich would run away with all the loot, while massively increasing share ownership in Ontario and raising funds to improve services and infrastructure. By selling millions of shares cheaply, and forbidding the trading of those shares, millions of Ontarians could reap the benefits of profit-making assets. This scheme would be contingent on reorganizing those agencies to become profitable, but could avoid a fire sale of taxpayer-funded agencies to wealthy corporations and investors. If critics of the government took the opportunity to guide the Conservatives, when a privatization is announced, towards mass share ownership, some good would come of it. 

With all its scandals, bad publicity, grotesque executive salaries and inconsistent service that has turned privatization into a dirty word in the UK, the fact is share ownership did go up. In 1979 when Conservative prime minister Margaret Thatcher was elected, shares were owned by 2.5 million people; by 1992, 11 million people had shares or a quarter of the population. Narrowly defined, that is a success. 

But the mainstream financial community loathes the idea for obvious reasons. At consultants KPMG, corporate evaluater John Kingston symbolizes the opposition to anything other than a straight sell-off at the stock exchange. “Issuance of shares to employees doesn’t put any new money into the coffers, like in the Eastern European example of gifting shares,” he says. “But selling shares to the public does provide some compensation. They must satisfy taxpayers by getting the right amount.”

“I think if government is going to privatize then it is a good time to do it,” says Deloitte and Touche’s Jim Horvath, a veteran of privatizations in Argentina, Hungary and Brazil, who supports a quick sell. “The stock market is up. There are a lot of deep pockets looking for investments.”

The mantra for an open sale will get louder as each privatization approaches. But such a sale does have its disadvantages. 

Advantages of an open sale: 

Can get the highest price. Use the funds to pay down debt or a one-time only increase in funds for something like health care. Argue protecting taxpayers’ interests by selling for the best price. The asset could raise funds on the stock market to improve infrastructure/services. Once in private hands, future governments will have a hard time trying to buy assets back. 

Disadvantages of an open sale: 

Taxpayers are also consumers; they could get screwed by any increase in rates. There is no guarantee the government will use funds for public good (maybe they will build another casino?). Any pay-off is once only, whereas the LCBO for example, makes money every year. Government could make a mistake and sell for too low a price. 

Government Agenda

Two factors could significantly slow down the government’s ability to launch privatizations. The Conservatives have relished making cuts to government services despite labour unrest, but it has shown little skill at the more intellectual task of implementing a new philosophy. Major planks of their Common Sense Revolution, such as workfare, are bogged down and in chaos. Privatization will need a sophisticated sales job to counter-attack the slick television and newspaper ads unions have been running for the past year attacking privatization. Encouraging mass share ownership would show that leadership the government sorely needs. 

The second liability is its own ambitious agenda. Already the Legislature has had to extend its term to try and deal with a backlog in reforms, including chopping another $3 billion, rearranging how government services are delivered and fighting the province’s doctors. But if it must privatize, then the honourable thing to do is to offer mass ownership. To do otherwise will show Ontario isn’t even capable of the heights of imagination some of Eastern Europe’s new democracies have shown. 

Note: I debated this topic on CBC TV’s Face Off after this was published. 

Cover headline: “The Harris Tories have an opportunity to turn Ontario into a shareholder democracy. Will they take it?”

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© David South Consulting 2021