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Bank towers in Toronto (Kevin Van Paassen/Kevin Van Paassen/The Globe and Mail)
Bank towers in Toronto (Kevin Van Paassen/Kevin Van Paassen/The Globe and Mail)

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A braying mule: Comparing taxes to 'ethnic cleansing' Add to ...

These are stories Report on Business is following Thursday, April 19, 2012. Get the top business stories through the day on BlackBerry or iPhone by bookmarking our mobile-friendly webpage.

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Taxing the rich Yes, I know what he was doing, and that he no doubt thinks he was being oh, so clever and provocative. But I'd instead borrow an oft-heard phrase where James Doak is concerned and say that every mule loves to hear himself bray.

Mr. Doak is the Canadian money manager who likened a tax-the-rich proposal by the Ontario New Democratic Party to "ethnic cleansing."

My colleague Barrie McKenna took him on in Monday's paper, explaining to Mr. Doak why the wealthy have become a tax target in the post-crisis era.

Mr. Doak then fired back with a column in the National Post, advising that he knew what he was saying, meant what he was saying, and, dammit, was going to say it again.

First, let me say that I'm not commenting here on the issue of wealth taxes, only on the mule that loves to hear himself bray, a money manager with Megantic Asset Management and, incredibly, a former chairman of the Toronto Society of Financial Analysts.

Besides the fact that his argument was flawed, his comments were, of course, stunningly offensive. We all know, as does he, that "ethnic cleansing" is not taxing the rich. It's murder. Genocide. Rwanda. Kosovo. Nazi Germany.

And that his latest rant should be published yesterday, the international day that remembers the Holocaust on the anniversary of the liberation of Auschwitz-Birkenau, was incredible, on the part of both Mr. Doak and the folks at the Post who published it.

Thus there are 6 million reasons why Mr. Doak should not invoke "ethnic cleansing" when what he's really talking about is that he doesn't want to pay more tax.

The offence aside, his argument is ridiculous. His point, I think, is that the Ontario NDP is trying to "cleanse" the province of the wealthy by forcing them to leave.

The suggestion that the rich, the ethnic in this case, will flee Ontario in advance of the invading socialists is asinine.

G20 to boost IMF The Group of 20 reluctantly agreed at a meeting in Washington today to beef up the lending power of the International Monetary Fund, a win for managing director Christine Lagarde, who risked her reputation by initiating a pledge drive that was received coolly by some of her biggest members, including Canada.

Finance ministers and central bank governors said the G20 would help build a firewall to shield the global economy from the European debt crisis, The Globe and Mail's Kevin Carmichael reports.

Inflation slows Canada's annual inflation rate slowed markedly in March to 1.9 per cent, from 2.6 per cent a month earlier, as increases in food and energy prices eased.

On a monthly basis, Statistics Canada said today, prices rose 0.2 per cent between February and March, faster than the 0.1-per-cent move between January and February.

Food prices stood out in March, rising 2.2 per cent in March from a year earlier, well down from February's 4.1 per cent.

"This slower increase was the result of a month-over-month decline in food prices in March 2012, while a year earlier food prices had been on the rise," the agency said.

While there's no question we're all still feeling the pain at the gas pump, energy cost increases slowed to 5.1 per cent year over year, compared to 7.2 per cent in February. Gasoline prices, in particular, were up by 6.6 per cent, a slower pace than February's 8.9 per cent.

So-called core prices, which strip out volatile items and help guide the Bank of Canada's monetary policy, increased 1.9 per cent over the year, again slower than the 2.3 per cent marked in February.

"This report won’t alter the Bank of Canada’s recent more hawkish tone," said Robert Kavcic of BMO Nesbitt Burns. "With the output gap gradually closing and core inflation running around 2 per cent, some withdrawal of the considerable monetary stimulus is certainly looking appropriate."

Encana strikes natural gas deal Just about everyone wants into Canada's energy sector.

Encana Corp. said today it struck a $600-million deal with Toyota Tsusho Corp. that will give the Japanese company a 32.5-per-cent royalty stake in natural gas production from part of its coalbed methane project, which takes in some 5,500 wells and possible future drilling in southern Alberta.

"This investment from a global partner recognizes the significant value identified in Encana's [coalbed methane]lands which rank among the company's lowest-cost, lowest-risk assets, and signifies another step as Encana pursues a range of opportunities to manage its portfolio and enhance the long-term value creation of its vast inventory," chief executive officer Randy Eresman said in a statement.

"Encana's [coalbed methane]resources cover a great expanse that includes approximately 2.1 million net acres in the Horseshoe Canyon fairway. The vast majority of this acreage is fee lands, where Encana holds the mineral rights in perpetuity, and are estimated to contain significant amounts of recoverable natural gas."

Currently, the wells are producing about 120 million cubic feet equivalent of natural gas daily, and the region, Encana said, holds some 480 billion cubic feet of proven and probably reserves.

Under the deal, Toyota is paying $100-million up front, and a further $502-million over seven years.

CP profit soars Canadian Pacific Railway Ltd. delivered a sharp jump in first-quarter profit today and heralded its improvement in the face of a pitched battled with an activist shareholder.

The Canadian railway, which is fighting against Bill Ackman of Pershing Square Capital Management, said profit climbed more than 300 per cent to $142-million or 82 cents a share, diluted. Revenue climbed to $1.4-billion. Its operating ratio was also better, at a lower 80.1 per cent, down from 90.6 per cent, The Globe and Mail's Brent Jang reports.

Per-share earnings were right in the middle of its previously announced forecast.

Mr. Ackman, now the railway's largest shareholder, has been pushing for change and demanding that chief executive officer Fred Green be replaced by Hunter Harrison, the former chief of rival Canadian National.

"We have improved operating momentum, we are delivering excellent service and we have a stronger, more resilient rail network," Mr. Green said.

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