Senator Jack Austin is an engaging rascal. He demonstrated his chutzpah anew by choosing the weekend of April 1 as the date to try to transform Canadair Ltd. from an albatross to a phoenix. So, on or about April Fools’ Day, an asset-laden company called “New Canadair” arose, reborn from the ruins of its debt-ridden parent. Forget about the company that last year announced the biggest loss in Canada’s corporate history. Forget the outfit that gulped down $750 million of “equity” money from the taxpayers without pausing for breath. Forget about the builder of executive jets that can never sell enough to repay the $1.35 billion in government-backed loans that piled up while it was trying to make and sell them. All that’s past. Now we have the new, slim, trim, virtually debt-free company—New Canadair.
New Canadair does not resemble the legendary phoenix in one respect. It leaves behind not the ashes of its predecessor but a corporate entity, “Old Canadair,” with all the debts and none of the assets. But the old legend may work in one way. The first job of the original phoenix was to fashion an egg out of the ashes of its parent and carry it to the priests of the Egyptian temple of the sun at Heliopolis where it was preserved forever. In the Canadair case, the debt of Old Canadair will be paid from money borrowed by the federal government. It will then become part of the national debt, to be preserved forever by the priests of the department of finance. The taxpayers will only have to supply preservative in the form of interest costs.
Whether the snake-oil salesmen of Austin’s Canada Development Investment Corp. can persuade companies to buy 15 executive toys in Canada each year is a question for the future. But I think the senator is onto something. His magic division of a doomed company into a bright new corporation on the brink of profit and a dirty old corporation with a millstone of debt is a technique that deserves wider use.
Whoever emerges from this year’s political brouhaha should apply it to the whole country. We could have a “New Canada” and an “Old Canada.” Old Canada, like Old Canadair, would be left with the debt and anything else we would like to shuck off. Its productivity
Allan Fotheringham is on vacation.
would be rotten. Its strike record would be one of the worst in the world. It would be in perpetual recession. It would get Halifax when the fog closes in, Montreal when a bone-chilling wind is blowing up the St. Lawrence, Ottawa in the freezing rain.
New Canada would get all the good stuff: Vancouver on a clear day, Winnipeg when the spring runoff is tinkling through the streets, Regina after a June rain when the breeze carries the smell of new growth from a million acres of wheat, Ottawa in tulip time.
I can imagine the Prime Minister of New Canada presiding over his nation in the sunny splendor of his capital. A delegation arrives to protest, say, the bludgeoning of seal pups. “You’ve got the wrong office,” the PM would say. “You’re looking for the Prime Minister of Old Canada. That’s where they’re still killing those cute little fellas. In New Canada, we’ve banned the hunt.”
‘The New Canada could have all the wacky and weird things that have made it different from any other land’
Searchers would eventually find the capital of Old Canada, a dank town in the vicinity of Ottawa. And there they would find a Scrooge of a Prime Minister, stained with red ink, spending his time entering ever-higher numbers for his country’s enormous debt.
A few of the mechanical details remain to be worked out. But this is a good time to think about what we would like in a New Canada. The new Prime Minister may not be able to pull off the Austin trick in all its beautiful simplicity. But there are choices to be made.
I would like to see New Canada take over all the wacky and weird things about this country that have made it different from any other. The reasonabove-passion gang has been busy homogenizing us for the past sixth of a century and some of the changes can’t be undone. We can’t go back, for example, to being a nation that had to ask the parliament of another country to amend our Constitution. It didn’t make any sense to keep our Constitution in London. That killed it in the end. But while it lasted it was a wonderful fact to relate to visitors.
The New Canada would still have the absentee monarchy, one of the most useful head-of-state institutions in the world. The Queen does not interfere in our quarrels; she hardly knows about them, and she is too far away to offer advice. She does not cost much. Some may mutter about the cost of royal visits. But that is peanuts compared to the cost of maintaining somebody in regal dignity for the whole year.
We would also keep Queen Victoria’s birthday. It definitely deserves a place in New Canada. Then, when strangers, especially Americans, ask us who is honored by our May holiday, we can continue to tell them that it is not, as they may suppose, for the founder of our country, that old John A. Macdonald. Nor is it for a famous leader such as Abraham Lincoln. It isn’t even for the birthday of our present Queen. It is the birthday of a woman who has been dead 83 years and who never set foot in this country.
The Crowsnest Pass rates are another example. They weren’t nearly as damaging to the economy as alleged. An old fixed charge, like an old tax, becomes fair as people adjust to it. And it was almost worth the cost to have a freight rate fixed forever at half a cent a ton-mile. It is probably too late to reverse the swing to metric, too. But measuring things by the distance from some dead king’s nose to his fingertips has the same fey quality.
We should not, in other words, be trying to make ourselves as much like other countries as we can. We should be rejoicing in our dissimilarity and inventing new, perhaps crazily Canadian, ways to do things.
That is why I would include, in the New Canada, the whole Jekyll-andHyde structure of the New Canadair and Old Canadair. The money is gone, lost forever. But to have two companies, both called Canadair—one full of wrinkles and debt and the other full of youth and promise—is marvellously Canadian. The Crow rate is dead and the British North America Act cannot be returned to Britain.
But in the future we will be able to amuse ourselves and astonish visitors with tales of Senator Austin’s audacity and his hilarious scheme for making a corporate loser into a winner by cutting off the good parts and forming them into a new entity.
Don McGillivray is national economics editor for Southam News.
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