THE TRUTH ABOUT INCOME TRUSTS #6

The Sorrow & The Lack Of Pity:
The Damage Done By Conscience Challenged Politicians

“It wasn’t just that the Composite Index dropped almost 300 points, shedding $26 billion in capitalization in one day (and $36.3 billion in the trust sector in two days!). The real story was the people who took the biggest hit. They weren’t cigar-smoking Wall Street moguls, they were ordinary folks. Many retirees and 50+ baby boomers saw a big chunk of their life savings melt away before their eyes” -- Gordon Pape, GlobeInvestor, Autumn 2006


"I am dismayed at the turn of events. I personally will survive, but tears come to my eyes when I think of all the retired people (both in the US and Canada) who had 50% or more of their "nest eggs" invested in these trusts and had a late night announcement on October 31st destroy their future. They have no capacity to earn income to replace what they have lost. They are helpless, frightened and bewildered. This is not what one would expect from a mature, civilized, democratic, and principled country such as I always considered Canada to be." -- M. K., USA, December 2006

"I do not want to go into the nitty gritty but I was looking forward to doing some traveling before I reach the pearly gates (hopefully). This [the Finance Minister’s new income-trust tax proposal] has now put a big strain on my financial situation and I am afraid that my dream will have to be put on hold. I am however afraid my dream will not be reached due to health problems. If I knew months ago that the government was going to do this, I may have been able to soften the blow. In all my years as a law abiding, tax providing and dedicated hard working Canadian, I have not seen such downright dirty trickery. Is there any hope this may change???? I will pray tonight that I will wake up from this nightmare."-- Anonymous, TRUSTS online forum, November 2006

"With the governments ill-considered action my account has gone down by $55,000 and most likely will not recover given the brutal shock to the royalty trust sector that occurred. I am back to worrying continuously about money, my future, and that of my wife. I do not expect this will be good for my health since I am a cancer survivor, the low grade lymphoma is still with me and might lead to more demands on the government purse, an interesting footnote on the government's concern for alleged tax leakage." -- A. Hurd, Victoria, November 2006

"Mr. Harper, you LIED to us and I take this very personally! I'm not just disappointed that you went back on your word, I'm so angry I can't wait for the next election to get rid of your Conservative government. I don't know who you guys are 'catering to', but it certainly isn't the average lower middle class retired Canadian like myself. I'm NOT rich and because of you I'm going to get a lot poorer now. All I need is income of about $34,000, but it looks like that goal will go up in smoke! I do not know how I will cover my modest cost of living as I face retirement in 2 months, but I guess you think this is OK as billions in [tax] surpluses keep rolling into your coffers." -- MLR, November 2006.

"You have to go some distance to upstage former Prime Minister Pierre Trudeau's heinous NEP, an ill-conceived government initiative that devastated the oilpatch in the early 1980s, in the minds of Calgarians. But Stephen Harper's Tories weren't far off the mark when they decided to renege on an election promise not to tamper with income trusts -- without bothering to warn either the industry or investors that changes were in the air. As a result, The Halloween Day Massacre as it has come to be known, is already inscribed in the annals of political infamy. In the meantime, investors are struggling to recoup the billions of dollars lost following the announcement." -- Columnist Charles Frank, Year-end Review, Calgary Herald, December 31, 2006

"Broken promises have consequences. Just ask any kid in grade school. But when a Prime Minister and Minister of Finance of a modern, Western, democratic society lie to and deceive their people the consequences are far reaching and…sometimes tragic.

"Yesterday, when I read a post on a popular financial forum, it took the concept of “betrayal of trust” to a whole new and tragic level. The poster said that an “old man” who had worked all his life, did the best he could to provide for his family and wife of many years, lost a huge whack of his savings in income trusts, and took his own life in mid-November of 2006.

"We don’t know the 'old man’s' name. We don’t have a picture of him. We don’t know how many grandchildren he had. We don’t know how many years he worked and saved. We don’t know his life’s story. We don’t know if he was like your grandfather or mine. From the post, what we do know is….he was depressed, he lost a large portion of his life savings after Oct. 31, 2006 , and he had most of that savings in income trusts.

"I think it is safe to say the 'old man', like most good, honest seniors….took [Prime Minister] Harper at his word. I know that many politicians, bureaucrats, and media types -- trying to comfort their own guilty (and not so guilty) souls -- will dismiss this financial loss nine ways from Sunday. I can hear it now: 'He should have been diversified.' 'He should have known the Income Trusts couldn’t last.' 'Besides, this action [by the Harper government] was for the greater good of our society'."

"And, this ladies and gentlemen, is where we are with today’s political and bureaucratic mentality….dismiss, deny, obfuscate, blame the victim. They will do anything but confront the real issue….the broken political promise and betrayal of trust.

"On November 1, 2006 , Harper & Flaherty’s premeditated BETRAYAL OF TRUST not only set up this grandfather and every senior/retiree for a financial catastrophe, but also destroyed any remaining faith we ever had in government, politicians, and bureaucrats -- R. Cox, Ph.D., January 2007