Federal Support of Bombardier...Good or Bad Idea?

[Veovis]

Even though Bombardier has paid back all the other loans, giving them another loan is a bad idea. Why? Because they're a Quebec based corporation. If they were from western Canada it would be okay.

I just think they have hit the bank of bailout to many times. If it comes with shares (voting) and a management change clause maybe it can be evaluated, but to float a couple billion and then see it get paid out in bonuses will be brutal. This company has had too many issues again and again to be a safe investment.

[The Green Barbarian]

Even though Bombardier has paid back all the other loans, giving them another loan is a bad idea. Why? Because they're a Quebec based corporation. If they were from western Canada it would be okay.

If they were in Western Canada they wouldn't need a bail out.

[Ub2]

I agree. Bombardier, needs to be cut loose and stand on it's own, with one conception -- we could give them the same bail-out like the west would receive from Ottawa.

[Omnitheo]

yeah, they'd have been fine in western Canada, where no company (especially in the oil industry) has ever gone through hard times and requested subsidies or bailouts from the government.

Good thing too, because it would expose a lot of hypocrisy with people complaining that the government isn't doing enough to help the struggling industry and keep Canadians employed.

[Veovis]

yeah, they'd have been fine in western Canada, where no company (especially in the oil industry) has ever gone through hard times and requested subsidies or bailouts from the government.

Good thing too, because it would expose a lot of hypocrisy with people complaining that the government isn't doing enough to help the struggling industry and keep Canadians employed.

If you can show the oil companies that have received 60 years of massive interest free loans while keeping the company owned and controlled by a small family, sure maybe you can make that argument, but if not, it doesn't apply.

[Barney Google]

Why, dontcha get it?

Bombardier is Quebec based...and well, ya know "Quebec and Quebecers are...hummm...just better"

(Havent we heard something along this line somewhere before? )

Better in this case, deserving of yet another bail out.

[Ub2]

As to the so-called hypocrisy if the west.

One of the standard talking points among those opposed to the fossil fuel industry is the notion that it is, in their words, “heavily subsidized.” Take the IMF study last year that claimed, quite dubiously, that Canada doles out $34 billion a year in subsidies for the energy sector. Never mind that the vast majority of those “subsidies” came in the form of unpriced externalities and uncollected carbon taxes, or that the actual value of direct support to producers (through tax credits and incentives) was $840 million – a figure that’s dwarfed by the direct taxes paid by the energy sector, even ignoring the spinoff jobs, wealth and tax revenues they create.

As economist and researcher Youri Chassin noted in “Is the Canadian Oil Industry Subsidized,” an article published last May by the Montreal Economic Institute, even the $840 million figure isn’t exactly accurate. “This is because many of the supposed subsidy programs are actually just a particular tax treatment common to the natural resources sector as a whole, which is faced with a specific economic reality,” he wrote. “Given the large amounts of start-up capital involved, the high degree of risk, and the many years that go by between initial investments and (hopefully) profits, companies are allowed to reduce the taxes they have to pay in the short term and defer them until later in the production cycle. But this is not a subsidy. It’s just a common-sense measure for ensuring the neutrality of the tax system between different industries.

https://www.albertaoilmagazine.com/2015/08/why-the-energy-sector-isnt-like-the-auto-industry/

Canadian taxpayers have sunk into this illustrious symbol of Canadian corporate achievement. Billions in grants, repayable loans, special government funding deals, sweetheart contracts for trains and planes, export trading schemes, and other direct and indirect subsidies have been flowing to the company for decades.

Taxpayers need relief. Instead, now more aid is heading for the Quebec-based plane and train maker, part of a major corporate reorganization and yet another government bailout.

http://business.financialpost.com/fp-comment/terence-corcoran-bombardier-a-symbol-canada-cant-keep-bailing-out

I believe this was written before the last bail-out.

[GordonH]

Province of Quebec not that long ago provided Bombardier with 1 billion dollars, were is that money.

Sorry the tap is dry, as I've said before get the money from private investors.

Added later: hmmm..... wondering was that billion part of the transfer payments from have Provinces.

[The Green Barbarian]

yeah, they'd have been fine in western Canada, .

you missed my point. They wouldn't need a bail-out because the government would just let them fail.

[Gone_Fishin]

Trudeau wrote the cheque to a company that said they didn't need the money. Trudeau wrote the cheque not knowing how many jobs it could create. Trudeau's a buffoon.

https://www.facebook.com/ronaambrose/vi ... 019963525/

[Rwede]

Latest subsidy to Bombardier a reminder of the many problems with corporate welfare

— February 8, 2017


The federal government’s recent announcement that it will provide Bombardier, a Canadian aerospace company, with interest-free loans totalling $372.5 million is a piercing reminder of the problems with targeted business subsidies.

For starters, Brazil has already filed a complaint with the World Trade Organization (WTO) against Canada on grounds of distorting the competitiveness of the global aerospace industry. The complaint claims that Bombardier has received “at least $2.5-billion in government support.”

The trade ramifications of the federal government’s actions are important on their own but the bigger issue is that business subsidies (so-called “corporate welfare”) are a failed approach to industrial policy. The historical record shows that policies where governments pick and choose particular companies or industries to support breed chronic dependence, and are unfair and ineffective.


Schnipski



But a more fundamental problem is that such preferential treatment effectively amounts to crony capitalism. It’s fundamentally unfair that taxpayer dollars are used to support such initiatives, which take money from millions of people and businesses, diverting it to a privileged few with special government relationships. The “promotion” of one industry almost invariably results in the “demotion” of other industries, as businesses and people without political clout are forced to pay full freight.


Schnipski




A 2013 Fraser Institute report on corporate welfare summarizes the academic literature as follows:

… as the literature overwhelmingly concludes, there may not be a demonstrable positive impact upon the economy, employment, and tax revenues, because of the substitution effect. In other words, a positive impact in a town, city, province, or country is typically offset by losses in elsewhere in the economy, including tax rates that are greater than would be the case without business subsidies. In summary, the literature suggests that subsidies to business are not the best means by which to encourage economic and employment growth.

Indeed, resources used for corporate subsidies would be more effectively used to reduce tax rates broadly for all businesses. After all, the money would be more effectively invested by market entrepreneurs who actually have the information and expertise to make informed investment decisions.


https://www.fraserinstitute.org/blogs/l ... te-welfare

[Rwede]

yeah, they'd have been fine in western Canada, where no company (especially in the oil industry) has ever gone through hard times and requested subsidies or bailouts from the government.

Glad you brought it up.

Your boy is failing miserably, as are you at defending him.

[Omnitheo]

https://www.google.ca/amp/s/amp.theguar ... on-trudeau

Canada’s attempt to act on climate change is being undermined by $3.3bn in government subsidies flowing to oil and gas producers in the country a year, a new report has warned.

The prime minister, Justin Trudeau, has vowed to place a national price on carbon dioxide emissions by 2018. Last week, Trudeau said he would not be deterred by the election as US president of Donald Trump, who has called climate change a “hoax”, and would forge ahead with the plan to “show leadership that quite frankly the entire world is looking for”.

But a study by four major Canadian environmental groups has shown that carbon pricing risks being undermined by billions of dollars in subsidies to fossil fuel interests, from both federal and provincial governments.

Sorry, your memes only work on the ignorant

[ferri]

*Stay on topic please.

[The Green Barbarian]

Sorry, your memes only work on the ignorant

and your Guardian links are only for the brain-washed. It took me several websites to drill down into what made up the $3.3 billion of "subsidies" and as expected, it was pure unadulterated rubbish. The whole point of this "study" was to give a sound-bite to "activists" to parrot, with no understanding of what they were even talking about.

http://www.iisd.org/faq/unpacking-canad ... subsidies/

This is a completely bogus list. CDE and CEE are expenses that are incurred by companies to drill for resources. All Canadian companies are allowed to deduct their operating expenses. It is ridiculous to call these "subsidies", but that doesn't stop the enviro-nuts from parroting a complete lie. Shame on these people for putting out such nonsense, and shame on the Guardian for reporting fake news.