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When a Bailout Isn't a Bailout, When News Is Fiction

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When a Bailout Isn't a Bailout, When News Is Fiction
by C. L. Cook
On a recent telecast of the Canadian Broadcast Corporation's (CBC) flagship news program, The National, reporter Terry Milewski informed Canadians; the reason prime minister Stephen Harper felt comfortable playing the scold to foreign finance ministers promoting the so-called 'Robin Hood Tax,' due shortly to appear in Canada for another in a series of transnational "G" meetings, was because Canada had not bailed out the banks in this country as had been done abroad.
 
Milewski's assertion went unchallenged by both anchor, Peter Mansbridge and CBC senior financial reporter, Amanda Lang.

Knowing Milewski's claim to be a blatant falsehood, I sent along this letter to the CBC:

"During tonight's broadcast, (May 18, 2010) The National ran a segment on the so named "Robin Hood Tax" and the Harper government's efforts to derail moves by other G20 countries to impose a tax, (more properly a fund) to avoid future bailouts of big financial institutions. During that report, Terry Milewski suggested, and this point was reiterated by Amanda Lang, Canada had not bailed out "its" banks. This is untrue.

"In October of 2008 Prime Minister Harper publicly announced that: "Canada Mortgage and Housing (CMHC) will purchase up to $25 billion in insured mortgage pools as part of the Government of Canada's plan, announced today, to maintain the availability of longer-term credit in Canada."[1]

"On November 12, 2008, another $50 billion allocation was announced. The official text was; "The Honourable Jim Flaherty, Minister of Finance, today announced the Government will purchase up to an additional $50 billion of insured mortgage pools by the end of the fiscal year as part of its ongoing efforts to maintain the availability of longer-term credit in Canada. This action will increase to $75 billion the maximum value of securities purchased through CMHC under this program."[2]

"I think you do the nation a great disservice by glossing over, avoiding, and revising the historical record, and expected much better journalism for my tax money. I would appreciate a correction and explanation of just how the CBC news staff regards a $75 billion gift to financial operators in Canada as anything but a bailout."

I've responded to CBC reports I felt erred in fact in the past, and I expected this one to go unanswered as had the previous, but to my surprise Mark Harrison, Executive Producer of The National got back to me within a couple days.
 
He disagreed with my assessment of the piece, writing;

Dear C.L. Cook,
 
Thank you very much for taking the time to send your e-mail. I do, however, take issue with your suggestion that we're revising the historical record."
Amanda has reported on the cost of the government's bailout in Canada several times, most recently just last week. You can find that story by following this link:   http://www.cbc.ca/thenational/about/correspondents/amandalang/  The story is titled "Bailout package explained" and can be found on the right hand side of the website.
In that piece, Amanda characterized the $75-billion as a bailout. The government, however, disputes that. We have also been told that these mortgage transactions actually yielded a profit. We've been digging into these transactions and have been told they have yielded a profit for the government. So far, though, we haven't seen the evidence of that. In any case, it was on a different scale from the bailouts in Britain and the United States and that was the main point we were making last night.
Yours sincerely,
 
Mark Harrison
Executive Producer
CBC News: The National

Mr. Harrison's response strikes me as strange. He begins by taking umbrage at my assertion the program is "revising the historical record," yet goes on to prove the point.
 
If senior economics reporter, Amanda Lang knows the $75 billion bailout is a bailout, and characterized it as such on previous programs, then is her silence following the Milewski piece, where he asserts there was no bailout, not "revisionist"?
 
Mr. Harrison goes further though, suggesting the government's claim the mortgages they assumed from private banks using public dollars are yielding dividends, as yet unrevealed. What's left unexplained is: How does the profitability of those assumed mortgages, if real, change the fact of the government's bailout?
 
In a final toss, Harrison maintains the scale of "the bailouts" in Canada differ from those in the United States and Great Britain, (though I would argue that assertion too, given the comparative scale of the Canadian economy) suggesting the "main" point of The National's report was not the fact or fallacy of the actual bailouts to banks, or their definition, but the "scale" of what we both now agree are in fact, BAILOUTS.

Neither the fact: Comparative scales of Canada's bailouts were not mentioned in the report, nor the fact that, in rebuking my original objection to the feature, Mr. Harrison proves the merits of its points seems to strike him as ironic.

I answered Mr. Harrison finally;

Thanks for your response, Mr. Harrison; my objection stands. To say, "last week we called it a bailout," does not excuse the blank assertion on the The National last night that there were no bailouts in Canada, and that is the reason the prime minister can force his policy preferences on foreign finance ministers.
If the fact of the movement of $75 billion tax dollars into private hands can be elastic enough to be termed "bailouts" on one program, and "non-bailouts" on another, then surely the word "omission" can cover for "revision."
Wasn't it Upton Sinclair who commented on the elasticity of reality, where a man cannot see the truth when his income is determined by not seeing it?
I am not convinced, but appreciate your precedent-setting response.

Cheers
Chris Cook
Pacific Free Press

The clip of Terry Milewski's report is below, but be aware; you'll have to endure a commercial, and a full minute of Robin Hood movie trailers, used to aid Mr. Milewski's reiteration of the government's false points.
 
If you are willing to pay the transcript fees, you can read anchor Mansbridge and senior economics reporter, Amanda Lang's response to the piece by going to the following:

CBC Transcripts and Tapes
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Incidentally; the Canadian Broadcast Corporation is owned and operated by the government of Canada.

May 18th, 2010 Milewski report clip:
http://www.cbc.ca/video/#/News/TV_Shows/The_National/Canada/ID=1497893285
 
 
 
 
[1] [2] Thanks to Erik Andersen for the bailout figures, and his tireless work to bring fiscal responsibility and accountability to the Canadian government, in service to the Canadian people.

 
   

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