Wednesday, February 24, 2010

The Conservative $286M boondoggle: Stimulus for the tobacco industry

As if the Conservative plan to bribe rich tobacco farmers with hundreds of millions of taxpayer dollars to stop growing a deadly crop didn’t seem dumb enough in the first place, we now find out that it’s even dumber than thought: many (most?) took the taxpayer money and went right on growing tobacco:

When the federal government offered $286-million in buyouts to Ontario's tobacco growers last year, the vast majority took the payments, designed to usher them out of a fast-shrinking industry. Given an average of $275,000 each, they were supposed to plant another crop, or maybe even try a different line of work entirely, federal ministers said at the time.

The Tobacco Transition Program has not worked out that way. In the first season since the government issued those payments, just as much tobacco has been harvested as the year before, and as many as 100 of the farmers who took the buyout still seem involved in producing tobacco.
That’s because this Conservative boondoggle of a program has more loopholes that you can shake a stick at.
In fact, federal officials have indicated buyout recipients can legally rent their land and machinery -- or even hire themselves out as employees to holders of new tobacco-growing licences.

In many cases, sources say, the buyout recipients are farming the same land as always after relatives or acquaintances -- some of them with full-time jobs in other places -- obtained a licence to grow.
So what did this program end up being? Not having done much to stop people from farming tobacco, it seems nothing more than smoke and mirrors designed to funnel taxpayer cash to wealthy tobacco farmers who will go on continuing to produce a crop that is harmful to society, and costs our health care system untold hundreds of millions annually.

It seems likely this program has more to do with boosting Conservative fortunes in South-Western Ontario than anything else. Of course it had to be done stealthily; pitching it as stimulus for the tobacco industry isn’t exactly a public relations winner.

And it’s not like the government can say it didn’t see these problems coming. Last March, it was informed of the loopholes in the program and how they were being taken advantage of. And it did nothing.
However, industry insiders say many farmers are taking advantage of the fact they can transfer their quota to anyone who is not their spouse or dependent child, and then apply for a licence to produce tobacco under a new regime being developed by the Ontario government.

"Pretty much everybody's doing it," said one Ontario tobacco farmer, who spoke on condition of anonymity for fear of retribution within the farming community.

"I'll give you an example. You own tobacco quota. You want to continue to grow tobacco, so what you do is you transfer your quota to me, but I don't even grow tobacco. I take the buyout and give you the dollars back, so now you're eligible for a licence to grow tobacco, and plus you get all that money."
If the Conservatives are more concerned about proper management of taxpayer dollars than they are about shoveling money off the back of a truck in an attempt to safeguard Diane Finley’s seat in parliament, they will call in the Auditor General to audit this program immediately, and find some way of recovering taxpayer dollars that have gone to farms that are still harvesting tobacco.

It seems pretty clear where Conservative priorities lay, however, and it’s not with taxpayers.

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CanadianSense said...


would you also agree it is a failure of leadership from all levels of government to not enforce and collect taxes from sales of smokes in Ontario?

Some figures have the loss of over three billion.

Anonymous said...

Prohibition (where absolute like with drugs, or indirectly through excessive taxation) never works.

MaryJane Cannabian said...

"Where there is demand, there will be supply." - Grade 11 Marketing Class

JimBobby said...

I live in the heart of tobacco country in Norfolk County. I see first hand the crybaby tobacco farmers driving their kids to hockey in their Lincoln pickup trucks. I see their lavish mansions. I see their offshore workers toiling the fields in scenes reminiscent of antebellum Dixie.

Tobacco farmers are a powerful lobby. It is their wealth and power that has kept their quest for handouts alive. When people quit buying typewriter ribbons, the typewriter ribbon manufacturers moved to other products or went out of business. When the market fell off for Canadian tobacco, tobacco farmers demanded a $1 billion "buy out" package. Despite the generosity of the $289 million referenced here, the tobacco farmers were not at all satisfied getting less than one-third of what they'd been bellyaching for.

Diane Finley was elected here largely because her predecessor, Bob Speller (LPC ag minister), had been unable to deliver the buy out. By delivering $289 mil, Finley has managed to placate both sides here. For the farmers, at least she delivered something. For the rest of us who saw the billion-dollar-buyout as a cash grab by those who have been snobbishly lording their wealthy lifestyles over us for decades, she at least didn't give them everything they wanted.

Trouble is, when you attempt to please everyone, you can end up pleasing no one.

Around here, it has been no secret that the farmers have been playing fast and loose with the rules of the buyout. While the total crop size has diminished since tobacco's hay day, the size has not diminished since the farmers got the so-called buy out money.

They're appeal for even more public cash so they can demolish the tobacco kilns they no longer need. There's no limit to their gall.

The article talks about how those who speak out against tobacco around these parts put themselves into jeopardy. That's one big reason I blog anonymously.

Here's what I figgered woulda got my windows shot out three years ago. The Tobacco Farmer Song