David William Schindler OC, D.Phil., FRSC, FRS (born August 3, 1940) is one of the world’s leading limnologists. He holds the Killam Memorial Chair and is Professor of Ecology in the Department of Biological Sciences at the University of Alberta in Edmonton, Canada. Schindler was born August 3, 1940 in Fargo, North Dakota and grew up in Minnesota lake country. He holds dual citizenship in Canada and the USA. After completing his bachelor’s degree in zoology from North Dakota State in 1962 he studied aquatic ecology at Oxford University as a Rhodes scholar. He worked first under Nikolaas Niko Tinbergen. But it was while working under Charles Sutherland Elton, one of the founders of ecology, who also established and led Oxford University’s Bureau of Animal Population, that he began formulating an interdisciplinary ecosystem approach to study water and ecology. Dr. Schindler was an assistant professor in the Biology Department at Trent University from 1966 to 1968. From 1968 to 1989, he founded and directed the Experimental Lakes Project of the Canadian Department of Fisheries and Oceans near Kenora, Ontario. This long-term study of freshwater is part of Schindler’s large body of scientific work which has influenced public policies regarding the protection of freshwater including the regulation of toxins and the limitation of eutrophication (excessive algal blooms) and acid rain in Canada, the USA and Europe.

This post, my new delicious entries, a Google Map in the making, and a considerable contribution to wikipedia article (above)  and related articles on world renowned limnologist David W. Schindler are in response to the Calgary Herald article (2010-08-30) by Deborah Yedlin criticizing Schindler’s science.

A report by Erin N. Kelly, David W. Schindler, Peter V. Hodson, Jeffrey W. Short, Roseanna Radmanovich, Charlene C. Nielsen entitled “Oil sands development contributes elements toxic at low concentrations to the Athabasca River and its tributaries” was published 2010-08-24 in the prestigious and influential journal Proceedings of the National Academy of Sciences in which the team of scientists show that the oil sands industry releases the 13 elements considered priority pollutants (PPE) under the US Environmental Protection Agency’s Clean Water Act, via air and water, to the Athabasca River and its watershed.

“Contrary to claims made by industry and government in the popular press, the oil sands industry substantially increases loadings of toxic PPE to the AR and its tributaries via air and water pathways. This increase confirms the serious defects of RAMP (11–13), which has not detected such patterns in the AR watershed. Detailed long-term monitoring is essential to distinguish the sources of these contaminants and control their potential impacts on environmental and human health (13). A robust monitoring program to measure exposure and health of fish, wildlife, and humans should be implemented in the region affected by oil sands development (38, 39) (Kelly et al).”

The scientific journal The Proceedings of the National Academy of Sciences of the United States of America is second only to the Journal of Biological Chemistry in the list of Top Ten Most-Cited Journals (All Fields), 1999-2009. Journals are ranked by total citations, based on papers published and cited in Thomson Reuters-indexed journals between January 1, 1999 and April 30, 2009 [*].

Yedlin has her finger on the pulse of the business world in general and the oil industry in particular but she is not a scientist. David W. Schindler is.

As I began to search out material to add to the paltry wikipedia entry I found mention of c. 250-300 articles in peer-reviewed scientific journals.  He has nine honorary doctorates from universities within Canada and the United States. The list of provincial, national and international awards is lengthy.

I began to hear his name associated with best practices in the early 1990s when my husband was working on his MA then his PhD where terms like the ecosystem approach and water resource management were part of our everyday conversations. In recent years I have consulted his work to understand the Wabano Lake phenomenon.

The oil industry in Alberta is currently under attack by a well-orchestrated Rethink Alberta campaign which reminds me of the anti-sealhunt ads, posters, postcards. Nervous investors may reconsider placing money in funds associated with industries under heavy scrutiny by major companies and major campaigns. Many are convinced that the oil industry is immune to these attacks and will continue with business as usual, pushing for lax regulations and publicly-funded financial incentives to move ahead as fast as possible with expansion. Indeed potential customers for oilsands oil include governments of countries like Korea, Japan, China who my not be swayed by public outcry over dirty oil.

There is a crisis of confidence in science, or at least in big science. Yet more than ever we need legitimate scientific knowledge claims to guide public policies particularly in those areas in which industry and the market fail us the most, in matters related to the environment.

To be continued

Links

Experimental Lakes Area

A Timeline of Selected Events

1940 Schindler was born August 3, 1940 in Fargo, North Dakota.

1958 Charles S. Elton’s book entitled The Ecology of Invasions by Animals and Plants was published by the University of Chicago Press. Schindler was influenced by his early reading of this book when he was a studying under limnology professor, Gabriel Comita at North Dakota State University in the summer of 1958(?). Schindler argues that Elton’s book is better written and more useful than Rachel Carson’s Silent Spring (Zagorski 2006-05-09).

1961-1963 John F. Kennedy was President of the USA.

1962 After completing his bachelor’s degree in zoology from North Dakota State in 1962 he studied aquatic ecology at Oxford University as a Rhodes scholar. He worked first under [“Niko” Tinbergen]. But it was while working under [Sutherland Elton] that he began formulating an interdisciplinary [ecosystem approach] to study water and ecology.

1963 Lester (Mike) Pearson was Prime Minister from 1963 to 1968.

1963-1969 Lyndon B. Johnson was President of the USA.

1966 Schindler received his doctorate from Oxford University.

1966 Canadian government created the Freshwater Institute (FWI) to study the Algal blooms that were plaguing Lake Erie. The predecessor of the FWI was the Central Fisheries Research Station of the Fisheries Research Board of Canada. Established in Winnipeg in 1944, the station was moved to London, Ont, in 1957 and then back to Winnipeg as the FWI in 1966. New laboratory and office facilities were opened in 1973. The FWI provides facilities for fisheries and environmental research in inland and Arctic waters as well as for the non-research activities of the region, such as fish and marine mammal management and protection in the Arctic; Arctic oceans management programs; protection of fish habitat in the prairies and the Arctic; and the management of federal harbours (FWI).

1966 Fisheries scientist Waldo Johnson proposed to pollute several small lakes intentionally.

The Canadian government set aside lakes in northern Ontario called the Experimental Lakes Area (ELA). I am not sure of the exact location of these lakes but they appear to be to the south of HWY 17, East of Hwy 71 in the Dogtooth Lakes area which is in or near the Provincial Park by that name. See maps here, here and here.

1966-1968 Schindler was an assistant professor in the Biology Department at Trent University.

1968-06 Schindler, D. W. 1968-06. “Feeding, Assimilation and Respiration Rates of Daphnia magna Under Various Environmental Conditions and their Relation to Production Estimates.” Journal of Animal Ecology. 37:2:369-385. British Ecological Society.

1968 Pierre Trudeau became Prime Minister of Canada and remained in office until 1979. He was re-elected Prime Minister in 1980 and remained in office until 1984.

1968 Schindler was at the Freshwater Institute, Fisheries Research Board of Canada in Winnipeg, Manitoba.

1968 Schindler was invited to head  the Experimental Lakes Project of the Canadian Department of Fisheries and Oceans near Kenora, Ontario. He conducted conducting experiments on whole ecosystems to directly test the effects including eutrophication of nutrient inputs, acid rain, climate change and other human insults on boreal aquatic ecosystems. His work has been widely used in formulating ecological management policy in Canada, the USA and in Europe. The Experimental Lakes Area was set aside for large-scale, whole-lake experiments. This had never done before. The project included a stellar staff of senior scientists. The Eutrophication Section was headed by well known ecologist Jack Vallentyne, who had recruited a group of about 15 senior scientists from around the world. Schindler was “one of the two or three youngest members of the group, and it was just a terrific environment for a young scientist to be in (Zagorski 2006).”

1968 Early stages of the oil sands development.

1969 Schindler was part of a team that studied Lake Winnipeg.

1969-1974 Richard M. Nixon was President of USA.

1973 The United States Congress passed the Endangered Species Act considered to be the most comprehensive and powerful piece of environmental legislation (Orians 1993).

1973

Dr. David W. Schindler separated Lake 226 with a a giant shower curtain and “treated one half with carbon, nitrogen, and phosphorous and the other half with carbon and nitrogen only (7). Aerial photographs captured the dramatic results: the phosphorous-treated half of the lake had become green and murky because of algal blooms, whereas the other half of the lake remained clear. Pictures can speak a thousand words, and the stark contrast of the two sides of Lake 226 caught the public’s eye and policymakers’ collective ear (Zagorski 2006-05-09).”1974-05-24 “In a now-famous experiment (Science, 24 May 1974, p. 897), the team divided Lake 226 with a plastic curtain and added phosphorus to one half. When it turned a distinctive murky green, they had their answer. It was an aerial photograph from this experiment that largely persuaded policymakers to phase out phosphorus from detergents. “I think that’s the single most powerful image in the history of limnology,” Elser says. When Schindler took the results— and the photo—to government hearings in Canada and the United States, he put ELA on the map as a hub of innovative,policy-relevant research.”

1974 Gerald R. Ford was President of the USA from 1974-1977.

1976-1988 In the Experimental Lake Area Schindler tackled one of the most contentious issues of the day, acid rain. In a series of experiments conducted between 1976 and 1988, researchers added sulfuric and nitric acid, pollutants that lead to acid rain, to Lake 223 and others.

1977 James Carter was President of the USA from 1977-1981.

1979 The Department of Fisheries and Oceans took over the management of Freshwater Institute and the Experimental Lakes which meant that departmental officials not scientists were in charge. This eventually changed the direction of research. The Department of Fisheries and Oceans focused on marine not freshwater and Experimental Lakes Project suffered from chronic underfunding.

1979-1990 Margaret Thatcher Prime Minister of UK.

1980 Since 1980, “Canada’s total energy production has increased by 87 percent, while its total energy consumption has increased by only 44 percent. Almost all of Canada’s energy exports go to the United States, making it the largest source of U.S. energy imports. Canada is consistently among the top sources for U.S. oil imports, and it is the largest source of U.S. natural gas and electricity imports. Recognizing the importance of the energy trade between the two countries, both participate in the North American Energy Working Group, which seeks to improve energy integration and cooperation between Canada, the U.S., and Mexico (EIA).”

1981 “Atmosphere-Biosphere Interactions: Toward a Better Understanding of the Ecological Consequences of Fossil Fuel Combustion.” Board on Agriculture and Natural Resources (BANR)

1981 Schindler was head of the Committee on the Atmosphere and the Biosphere “Atmosphere-Biosphere Interactions: Toward a Better Understanding of the Ecological Consequences of Fossil Fuel Combustion.” National Academy Press.

1981 Ronald Reagan was President of the USA from 1981-1989.

1982 Schindler was President of the American Society of Limnology and Oceanography.

1984 Schindler was awarded the Outstanding Achievement Award of the American Institute of Fisheries Biologists,

1984 Schindler was awarded  the Frank Rigler Award of the Canadian Limnological Society.

1984 Brian Mulroney was Prime Minister of Canada from 1984 to 1993.

1983 Fellow of the Royal Society of Canada (FRSC).

1985 G.E. Hutchinson Medal of the American Society of Limnology and Oceanography,

1986 “A publication by (Moon et al 1986)  indicated that Suncor permitted effluent discharge of oil and grease to the Athabasca River at 420 kg per day (Moon et al 1986).  Sometimes, operation problems resulted in excessive effluent discharge into the river (Moon et al 1986) In addition to water-born effluents, the two oil sands extraction plants (Suncor and Syncrude) emitted massive amounts of particulates in the atmosphere. Particulates mass emissions from the Suncor powerhouse stack ranged from 547 to 780 kg per hour; the Syncrude Canada main stacks mass emissions ranged from 713 to 1067 kg per hour (Moon et al 1986)  cited in (Chen 2009-02).”

“This study examined trace metal levels in scalp hair taken from 122 children and 27 adult residents of three small northern Alberta (Canada) Indian villages, one of which is situated close to the world’s first tar sands oil extraction plants. The three communities studied were: Fort McKay (the exposed village), Fort Chipewyan (also in the tar sands ecosystem but distant from the plants), and Garden River (not in the tar sands ecosystem). Inductively coupled argon plasma emission spectroscopy was used to determine hair sample metal content. Nineteen metals were included in data analysis. Children from Fort McKay had the highest average hair lead, cadmium and nickel levels. Chromium levels were approximately equal in hair from Fort McKay and Garden River children, and significantly elevated above levels found in the hair of Fort Chipewyan children. Children from Garden River showed highest hair levels of eight metals: vanadium, aluminum, iron, manganese, barium, zinc, magnesium and calcium. Fort Chipewyan children had the highest hair levels of copper, but the lowest levels of all other metals. Among adults, hair lead, nickel and cadmium levels were highest in Fort McKay residents, while phosphorous and vanadium were highest in hair from Garden River residents. Bioaccumulation of lead, cadmium, nickel and chromium in hair from Fort McKay residents may be related to exposure to extraction plant pollution. Plant stack emissions are known to contain appreciable amounts of lead, nickel and chromium. Spills into the Athabasca River, until recently the source of Fort McKay drinking water, have been reported from plant wastewater holding ponds, known to contain elevated levels of lead, nickel and cadmium. An increased number of significant metal—metal correlations in hair metal levels for Fort McKay children suggests a richer source of multiple metal exposure, relative to children in the other two communities (Moon et al 1986).”

1988 Schindler was awarded the Naumann-Thienemann Medal of the International Limnological Society,

1989 Schindler left the Experimental Lakes Project which he had founded and managed since 1968.

1989-90 Schindler was a federal member of the Alberta Pacific Review Panel.

1989 Robert Hecky replaced Schindler as Director of the Experimental Lakes Project.

1989 George H. W. Bush President of the USA 1989-1993

1989-present “Dr. Schindler holds the Killam Memorial Chair and is Professor of Ecology in the Department of Biological Sciences at the University of Alberta.  He has studied the effects of climate warming, alien fish stocks, airborne contaminants and other human impacts on freshwaters of the Rocky Mountains.

1990 The U.S. Congress passed major amendments to the Clean Air Act that helped reduce acid rain (Science, 6 November 1998, p. 1024).

1990 Environmentalist, specialist in biosphere pollutants and water chemistry, David William Schindler received an honorary D.Sc. from the University of Victoria (1990).

1992 Dr. David Schindler  received the Stockholm Prize, aquatic science’s equivalent of the Nobel Prize, for research studies carried out by the Freshwater Institute (FWI) at the Institute’s Experimental Lakes area field station in northwestern Ontario.

1993 Jean Chretien was Prime Minister of Canada from 1993 to 2003.

1993 Bill Clinton was elected as President of the USA and remained in office until 2001.

1993 Schindler was awarded the Manning Award of Distinction for Innovation in Science.

1994 Schindler was awarded the first Romanowski Medal of the Royal Society of Canada.

1996 The Canadian federal government tried to shut Experimental Lakes Project and Director Robert Hecky resigned in protest.

1998 Schindler was awarded the Volvo Environment Prize.

1997 The Regional Aquatics Monitoring Program (RAMP) is a joint environmental monitoring program that assesses the health of rivers and lakes in the oil sands region of northeastern Alberta. The RAMP Regional Study Area (RSA) is defined by the northeastern Regional Municipality of Wood Buffalo. The RAMP RSA is bounded by the Alberta-Saskatchewan border on the east, the Alberta-Northwest Territories to the northeast, the Wood Buffalo National Park to the northwest and various demarcations including the Athabasca River and Cold Lake Air Weapons Range to the south. Within the Regional Study area is the Focal Study area and this area is defined by the watersheds in which oil sands development is occuring or will occur as well as portions of the Athabasca and Clearwater rivers found within the RSA. RAMP has focused on these main aquatic systems: The Athabasca River and Peace Athabasca delta. Tributaries to the Athabasca River including the Steepbank, Clearwater -Christina, Hangingstone, Ells, Tar, Firebag, Calumet, Muskeg, MacKay Rivers as well as several smaller tributaries Wetlands and lakes occurring near current and proposed oil sands developments (Isadore’s Lake, Shipyard Lake, McClelland Lake and Kearl Lake. Acid sensitive lakes in northeastern Alberta. Regional Lakes important to fisheries (RAMP website).

1997-2009 Dr. Hans Peterson founded the Safe Drinking Water Foundation  (SDWF), a small non-profit foundation that specializes in helping aboriginal communities with their water problems and in educating students about protecting freshwaters. In 2010 Schindler chaired the board of directors of the Safe Drinking Water Foundation.

1991 Schindler was awarded the first Stockholm Water Prize.

2000 Schindler was awarded the NSERC Award of Excellence in Research.

2000-2003 Schindler was a member of Environment Canada’s Science and Technology Advisory Board.

2001-01 George W. Bush was elected as President of the United States.

2001 Schindler was nominated as membership of the Royal Society of London in 2000 and named as Fellow in 2001 (FRS).

2001 Schindler was awarded the Environment Canada’s Vollenweider Lectureship.

2001 Schindler was awarded the Canadian Nature Federation’s Douglas Pimlott Award for Conservation.

2001 Schindler was awarded the National Science and Engineering Research Council’s Gerhard Herzberg Gold Medal for Science and Engineering, Canada’s highest scientific honor.

2003 Paul Martin was Prime Minister of Canada from 2003 to 2006.

2003 Schindler received the Queen’s Jubilee Medal.

2003-05 Schindler received the Killam prize, awarded for outstanding career achievements.

2004-01 Schindler was appointed as an Officer of the Order of Canada.

2004 Schindler was elected to the U.S. National Academy of Sciences.

2004 Schindler was elected as one of 100 Edmontonians of the Century, in honour of Edmonton’s centennial year.

2005 Schindler chaired Alberta Environment’s 2005 review of Lake Wabamun.

2005 Schindler was awarded the Alberta Centennial Medal.

2005 The RAMP report claimed there was no negative impact of the Oil Sands development on the regional water system.

2006 Stephen Harper was elected as Prime Minister of Canada.

2006 “Canada is a net exporter of oil, natural gas, coal, and electricity. It is one of the most important sources for U.S. energy imports. Canada is consistently the top supplier of oil imports to the United States. Canada produced 19.3 quadrillion British Thermal Units (Btu) of total energy, the fifth-largest amount in the world. In 2006, the largest source of energy consumption in Canada was oil (32 percent), followed by hydroelectricity (25 percent) and natural gas (24 percent). Both coal (10 percent) and nuclear (7 percent) constitute a smaller share of the country’s overall energy mix (EIA).”

2006 Schindler was a member of the Alberta Government’s Environmental Protection Committee.

2006 Schindler was awarded the Tyler Prize for Environmental Achievement “In recognition of his discoveries, made through interdisciplinary experimental research and ecological hypothesis testing, that contribute to understanding how anthropogenic stressors affect the health of freshwater ecosystems.”

2006 American Society of Limnology and Oceanography Ruth Patrick Award.

2006-05-09 Schindler and Donahue published their findings in the The National Academy of Sciences of the USA on “An impending water crisis in Canada’s western prairie provinces.”

2006 Dr. John O’Connor, a physician working in Fort Chipewyan, reported a high number of cases of cholangiocarcinoma, a rare form of bile duct cancer, as well as high rates of other cancers (Chen 2009-02).

2007-03-22 At the University of British Columbia guest speaker Dr. Schindler presented his paper entitled “Western Canada’s Freshwater Supply in the 21st Century” in which he argued that Canada’s western prairie provinces (WPP) will experience severe water shortages as a result of natural drought, climate warming, damage to natural drainage patterns and human demands for water.

2007-11 Kevin P. Timoney’s report, “funded by the Nunee Health Board Society evaluated environmental contaminants in the area surrounding Fort Chipewyan. From 2001 to 2005, concentrations of polycyclic aromatic hydrocarbons (PAHs) rose within the sediment around Lake Athabasca. The report indicated that the treated drinking water in Fort Chipewyan was safe, but described high levels of arsenic, mercury and PAHs in fish, which is the main diet of many people in Fort Chipewyan, especially members of its Aboriginal communities  (Chen 2009-02).”

2008 Schindler was appointed to the Alberta Order of Excellence.

2008 Schindler co-authored the book entitled The Algal Bowl: Overfertilization of the World’s Freshwaters and Estuaries with J.R. Vallentyne. In it they describes in accessible language the causes of algal blooms and ways that this excessive production could be avoided and even reversed.

2008-10-26/28 Schindler was a guest speaker along with other internationally distinguished scientists  specializing in Lake Winnipeg’s watershed issues who presented at a conference at the University of Winnipeg entitled The Red Zone: Currents, Chemicals and Change Symposium held in Winnipeg, Manitoba.

2008 An anonymous donor endowed the $1 million David Schindler Professorship in Aquatic Science which will ensure that Trent University will be able to attract and retain the finest faculty in perpetuity.

2008(?) Schindler served on the Board of Directors of the provincial Safety, Security and Environment Institute.

2008(?) Schindler chaired the International Review Committee for the Alberta  Ingenuity Water  Research Center.

2009-05 Schindler received the Royal Canadian Institute’s Sandford Fleming Medal for public communication of science.

2009-02 Alberta Health Services (AHS) released a study entitled Cancer Incidence Cancer Incidence in Fort Chipewyan, Alberta 1995-2006 by Yiqun Chen. The study found that cancer rates in Fort Chipewyan were 30% higher than expected and that community residents had a much higher likelihood of suffering from rare auto-immune diseases than other Albertans.

2009-12-03 Schindler, David W. 2009-12-03. “Ecosystem Services and Biodiversity Issues in the Canadian Boreal Biome: The Cumulative Effects of Human Disturbance and Changing Climate.” IAP: The Global Network of Science Academies

2010-08-24. A report by Kelly, Erin N. Kelly, David W. Schindler, Peter V. Hodson, Jeffrey W. Short, Roseanna Radmanovich, Charlene C. Nielsen entitled “Oil sands development contributes elements toxic at low concentrations to the Athabasca River and its tributaries.” was published in the prestigious and influential journal Proceedings of the National Academy of Sciences.

2010-01-12 Schindler presented IAP Conference on Biodiversity in London.

Academic and Honorary Degrees

  • B.Sc. North Dakota State University (1962)
  • D. Phil. Oxford University (1966)
  • D.Sc. (Honorary) North Dakota State University (1978)
  • D.Sc. (Honorary) University of Victoria (1990)
  • D.Sc. (Honorary) Athabasca University
  • D.Laws. (Honorary) Trent University
  • D.Sc. (Honorary) Brock University
  • D.Sc. (Honorary) University of Winnipeg
  • D.Sc. (Honorary) University of Lethbridge (2006)
  • Awards and Honours

  • Fellow of the Royal Society (2001)
  • Douglas H. Pimlott Award for Conservation, Canadian Nature Federation (2001)
  • NSERC Award of Excellence (2000)
  • ASTech (Alberta Science and Technology) Award for Outstanding Leadership in Alberta Science (1999)
  • Distingushed Member, International Water Academy, Oslo, Norway (1999)
  • J Gordin Kaplan Award for Excellence in Research, University of Alberta (1999)
  • Co-recipient, Volvo Environment Prize (1998)
  • Walter Bean-Canada Trust Award for Environmental Science (1996)
  • First Romanowski Medal, Royal Society of Canada (1994)
  • Manning Distinguished Achievement Award (1993)
  • First Stockholm Water Prize, Stockholm Water Foundation (1991)
  • Naumann-Thieneman Medal, International Limnology Society (1989)
  • Hutchinson Medal, American Society of Limnology and Oceanography (1985)
  • Frank Rigler Award, Canadian Society of Limnologists (1984)
  • Outstanding Achievement Award of the American Institute of Fisheries Research Biologists (1984)
  • Fellow of the Royal Society of Canada (1983)
  • Service in the International Scientific Community

    Selected Webliography

    David W. Schindler.” wikipedia article.
    Stokstad, Erik. 2008-11-28. “Canada’s Experimental Lakes.” Science Magazine. vol. 322.
  • AB. Members Profile David W. Schindler. Alberta Order of Excellence.
  • IAP. 2010-01-12. “Profile on David W. Schindler.” IAP Conference on Biodiversity. London.
  • McGill University Water 2010. Profile of David W. Schindler.
  • Stockholm International Water Institute (SIWI). Profile David W. Schindler.
  • Trent University News Release. 2008-05-21. “Trent University Announces David Schindler Endowed Professorship in Aquatic Science.”
  • University of Alberta Department of Biological Sciences. “Profile of David W. Schindler.
  • Zagorski, Nick. 2006-05-09.”Profile of David W. Schindler.” Proceedings of the National Academy of Sciences of the United States of America.
  • Selected Publications
  • Kelly, Erin N.; Schindler, David W.; Hodson, Peter V.; Short, Jeffrey W.; Radmanovich, Roseanna; Nielsen, Charlene C. 2010-08-24. “Oil sands development contributes elements toxic at low concentrations to the Athabasca River and its tributaries.”. Proceedings of the National Academy of Sciences.
  • Schindler, David W. 2009-12-03. “Ecosystem Services and Biodiversity Issues in the Canadian Boreal Biome: The Cumulative Effects of Human Disturbance and Changing Climate.” IAP: The Global Network of Science Academies
  • Schindler, David W. Donahue, W. F. 2006-05-09. “An impending water crisis in Canada’s western prairie provinces.” 103:19:7210–7216. The National Academy of Sciences of the USA.
  • Tilman, D.J. Farglione, B. Wolff, C. D’Antonio, A. Dobson, R. Howarth, D. Schindler, W. Schlesinger, D. Simberloff, and D. Swackhamer. 2001. “Forecasting agriculturally-driven global environmental change.” Science 292: 281-284.
  • Schindler, D.W. 2001. The cumulative effects of climate warming and other human stresses on Canadian freshwaters in the new millennium. Can. J. Fish. Aquat. Sci. 58: 18-29.
  • Schindler, D.W. 2000. “Aquatic problems caused by human activities in Banff National Park.” Ambio 29: 401-407.
  • Wilhelm, F.M. and Schindler, David W. 2000. “Reproductive strategies of Gammarus lacustris (Crustacea: Amphipoda) along an elevation gradient.” Functional Ecology. 14: 413-422.
  • Hudson, J.J., W.D. Taylor and David W.Schindler. 2000. “Phosphate concentration in lakes.” Nature 406: 54-56.
  • Wilhelm, F.M., B.R. Parker, D.W. Schindler and D.B. Donald. 2000. Seasonal food habits of bull trout from a small alpine lake in the Canadian Rocky Mountains. Trans. Amer. Fish. Soc. 128: 1176-1192.
  • Campbell, L.M., D.W. Schindler, D.B. Donald and D.C.G. Muir. 2000. Organochlorine transfer in the food web of subalpine Bow Lake, Banff National Park. Can. J. Fish. Aquat. Sci. 57: 1-12.
  • Hudson, J.J., W.D. Taylor, and David W. Schindler. 1999. Planktonic nutrient regeneration and cycling efficiency along a trophic gradient of temperate lakes. Nature 400: 659-661.
  • Schindler, David W. 1999. From acid rain to toxic snow (Volvo Environmental Prize Lecture). Ambio 28: 350-355.
  • Donald, D.B., J. Syrgiannia, R.W. Crosley, G. Holdsworth, D.C.G. Muir, B. Rosenberg, A. Sole, and D.W. Schindler. 1999. Delayed deposition of organochlorine pesticides at a temperate glacier. Environ. Sci. Technol. 33: 1794-1798.
  • McNaught, A.S., David W. Schindler, B.R. Parker, A.J. Paul, R.S. Anderson, D.B. Donald and M. Agbeti. 1999 Restoration of the food web of an alpine lake following fish stocking. Limnol. Oceanogr. 44: 127-136.
  • Wilhelm, F.M. and D.W. Schindler. 1999. Effects of Gammarus lacustris (Crustacea: Amphipoda) on plankton community structure in an alpine lake. Can. J. Fish. Aquat. Sci. 56: 1401-1408.
  • Blais, J.M., David W. Schindler, D.C.G. Muir, D.B. Donald and B. Rosenberg. 1998. Accumulation of persistent organochlorine compounds in mountains of western Canada. Nature 395: 585-588.
  • Schindler, David W. 1998. Replication versus realism: the need for ecosystem-scale experiments. Ecosystems 1: 323-334.
  • Schindler, David W. 1998. A dim future for boreal waters and landscapes. BioScience 48: 157-164.
  • Schindler, David W. 1997. Widespread effects of climatic warming on freshwater ecosystems. Hydrologic Processes. 11: 1043-1067.
  • Leavitt, P., R.D. Vinebrooke, D.B. Donald, J.P. Smol, and David W. Schindler. 1997. Past ultraviolet radiation environments in lakes derived from fossil pigments. Nature 388: 457-459.
  • Schindler, David W. and P.J. Curtis. 1997. The role of DOC in protecting freshwaters subjected to climatic warming and acidification from UV exposure. Biogeochemistry 36: 1-8.
  • Schindler, David W., P.J. Curtis, S.E. Bayley, B.R. Parker, K.G. Beaty and M.P. Stainton. 1997. Climate-induced changes in the dissolved organic carbon budgets of boreal lakes. Biogeochemistry 36: 9-28.
  • Schindler, David W., S.E. Bayley, B.R. Parker, K.G. Beaty, D.R. Cruikshank, E.J. Fee, E.U. Schindler and M.P. Stainton. 1996. The effects of climatic warming on the properties of boreal lakes and streams at the Experimental Lakes Area, Northwestern Ontario. Limnol. Oceanogr. 41: 1004-1017.
  • Schindler, David W., P.J. Curtis, B. Parker, and M.P. Stainton. 1996. Consequences of climate warming and lake acidification for UV-b penetration in North American boreal lakes. Nature 379: 705-708.
  • Kidd, K.A., David W. Schindler, D.C.G. Muir, W.L. Lockhart, and R.H. Hesslein. 1995. High toxaphene concentrations in fish from a subarctic lake. Science 269: 240-242.
  • Carpenter, S.R., S.W. Chisholm, C.J. Krebs, David W. Schindler, R.F. Wright. 1995. “Ecosystem experiments.” Science. 269: 324-327.
  • Schindler, David W., K.A. Kidd, D. Muir, and L. Lockhart. 1995. “The effects of ecosystem characteristics on contaminant distribution in northern freshwater lakes.” Sci. Tot. Environ.160/161: 1-17.
  • Kidd, K.A., David W. Schindler, R.H. Hesslein and D.C.G. Muir. 1995. “Correlation between stable nitrogen isotope ratios and concentrations of organochlorines in biota from a freshwater food web.” Sci. Tot. Environ. 160/161: 381-390.
  • Schindler, David W., K.G. Beaty, E.J. Fee, D.R. Cruikshank, E.D. DeBruyn, D.L. Findlay, G.A. Linsey, J.A. Shearer, M.P. Stainton and M.A. Turner. 1990. “Effects of climatic warming on lakes of the central boreal forest.” Science. 250: 967-970.
  • Schindler, David W., K.H. Mills, D.F. Malley, D.L. Findlay, J.A. Shearer, I.J. Davies, M.A. Turner, G.A. Linsey and D.R. Cruikshank. 1985. “Long-term ecosystem stress: The effects of years of experimental acidification on a small lake.” Science. 28: 1395-1401.
  • Committee on the Atmosphere and the Biosphere. 1981. “Atmosphere-Biosphere Interactions: Toward a Better Understanding of the Ecological Consequences of Fossil Fuel Combustion.” National Academy Press.
  • Schindler, David W. 1977. “Evolution of phosphorus limitation in lakes: Natural mechanisms compensate for deficiencies of nitrogen and carbon in eutrophied lakes.” Science. 195: 260-262.
  • Schindler, David W. 1974. “Eutrophication and recovery in experimental lakes: Implications for lake management.” Science. 184: 897-899.
  • Schindler, D. W. 1968-06. “Feeding, Assimilation and Respiration Rates of Daphnia magna Under Various Environmental Conditions and their Relation to Production Estimates.” Journal of Animal Ecology. 37:2:369-385. British Ecological Society.
  • Selected Awards and Honours

  • Alberta Order of Excellence (2008)
  • Co-recipient, Tyler Prize for Environmental Achievement (2006)
  • Officer of the Order of Canada (2004)
  • Lifetime Achievement Award, Canadian Institute for Environmental Law and Policy (2004)
  • Killam PrizeCanada Council for the Arts (2003)
  • Elected Foreign Member, Royal Swedish Academy of Engineering Sciences (2003)
  • Queen’s Golden Jubilee Medal, Office of the Governor General of Canada (2002)
  • City of Edmonton, Award of Distinction (2002)
  • Elected Member, National Academy of Sciences (USA) (2002)
  • Environment Canada, EcoLogo/Natural Marine Environmental Award (2002)
  • R.A. Vollenweider Lectureship, National Water Research Institute (2001)
  • Gerhard Herzberg Canada Gold Medal for Science and Engineering, Natural Sciences and Engineering Research Council (Canada) (2001)
  • Award of Excellence, Natural Sciences and Engineering Research Council (Canada) (2001)
  • Fellow of the Royal Society (2001)
  • NSERC Award of Excellence (2000)
  • Co-recipient, Volvo Environment Prize (1998)
  • First Romanowski Medal, Royal Society of Canada (1994)
  • First Stockholm Water PrizeStockholm Water Foundation (1991)
  • Hutchinson MedalAmerican Society of Limnology and Oceanography (1985)
  • Fellow of the Royal Society of Canada (1983)
  • Rhodes Scholarship, 1962-1966
  • References

  • AB. Members Profile David W. Schindler. Alberta Order of Excellence.
  • Kosowan, Gene. 2001-07-03. “Schindler named royal fellow.” University of Alberta Express News.
  • McGill University Water 2010. Profile of David W. Schindler.
  • Stockholm International Water Institute (SIWI). Profile David W. Schindler.
  • Trent University News Release. 2008-05-21. “Trent University Announces David Schindler Endowed Professorship in Aquatic Science.”
  • University of Alberta Department of Biological Sciences. “Profile of David W. Schindler.
  • Zagorski, Nick. “Profile of David W. Schindler.”
  • Related Reading
    Elton, Charles S. 1958. The Ecology of Invasions by Animals and Plants. University of Chicago Press.

    Yedlin, Deborah. 2010-08-31. “Athabasca water study misses bigger picture.” Calgary Herald.

    Chen, Yiqun. 2009-02. Cancer Incidence Cancer Incidence in Fort Chipewyan, Alberta 1995-2006 . Alberta Health Services (AHS).

    Moon J, Smith TJ, Tamaro S, Enarson D, Fadl S, Davison AJ et al. “Trace metals in scalp hair of children and adults in three Alberta Indian villages.” Sci Total Environ 1986; 54:107-125.

    Draft! My Google Map entitled Oil Sands, delicious, papergirls, EndNote, YouTube, Draft!

    See also

    Places of interest:
    MacKay River: In the story on The difference is spelling of McKay in Fort McKay and MacKay River is confusing. Is McKay River (known locally as Red River) the same river as MacKay River? Where is Devon?

    National Geographic suggests the potential worth of the Alberta oil sands is $80 trillion.

    See also

    Notes

    Bitumen is basically oil-soaked sand.

    Timeline

    1965 Karl Clark, a patient chemist, took 45 years to perfect a hot-water process in which bitumen frothed to the top and sand settled to the bottom. He used his wife’s washing machine. In 1965 the Great Canadian Oil Sands Company (now Suncor) ran the first commercial application of Clark’s hot-water process producing 45,000 barrels a day. In order to create the mine to feed the hot-water process, thousands of trees were bulldozed (Nikiforuk 2008).

    1976 The Canadian Council of Chief Executives (CCCE) founded in 1976, has been Canada’s private sector leader in the promotion of international trade and investment liberalization. The members of the CCCE include the chief executive officers of 150 leading Canadian corporations. These companies collectively administer close to $3.0 trillion in assets, have annual revenues of more than $650 billion and account for a significant majority of Canada’s private sector investment, exports, training and research and development.

    1997 Among other initiatives, the CCCE organized and hosted the first-ever APEC (Asia- Pacific Economic Cooperation) CEO Summit in 1997, during which it received His Excellency Jiang Zemin, then-President of China.

    2002 Suncor began producing oil at MacKay River in 2002, while Firebag stages 1 and 2 began producing oil in 2004 and 2006 respectively. The sequence and timing of additional stages of Firebag and a potential expansion of the MacKay River facility will be considered as part of a review of oil sands growth projects.

    2006 “In 2006, more than 100 of Canada’s public companies were acquired by foreign interests. The list includes some of the oldest and most well-established companies across a broad spectrum of industries – everything from hotels to retailing, to metals and mining. And the trend continues. I sometimes worry that we may all wake up one day and find that as a nation, we have lost control of our affairs. I think we ought to have a vigorous debate about the extent to which it matters whether or not ownership of our economy resides in Canada. I believe that ownership matters a lot. It matters not only for economic reasons but, more importantly in my opinion, for our own sense of self-esteem and pride in our country. My concern is not rooted in any chauvinism or in any antipathy towards foreign investment. Far from it. I happen to believe that globalization is a very positive development and that trade and investment across borders is to be encouraged. Canada benefits mightily from being “open for business” and we mustn’t do anything to change that. My concern stems from the fact that the world is awash with capital and that the consolidation trend in many industries will inevitably continue. We are a small country with a relatively small population. Canadian companies typically are not of a size to be global players. All too often, decisions affecting the future of important firms and the communities that they sustain are made solely with a view to the short-term financial consequences. I find it particularly bothersome that so many of our natural resource companies – which I would argue represent unique and irreplaceable assets – are now owned elsewhere. So what are some actions that we might consider taking? Well, what if we were to consider the feasibility of adopting ownership restrictions for certain sensitive sectors of our economy that would be similar to those that now apply to our financial institutions? After all, I would argue that it is a demonstrable fact that public policy regarding the ownership of our banks and insurance companies has served the country well; there is no shortage of competition in the financial services sector and the services available to Canadians are as comprehensive and as affordable as exist anywhere in the world. Securities regulation is another area where some useful debate could be undertaken. Many feel that Canada now has the most bidder-friendly environment in the world and that this may not always be in our country’s best interests. Under our rules, shareholder rights plans – also known as takeover defenses or “poison pills” – fall away after a very short 60 or 90 days, leaving the target company’s board with far too little time in which to explore alternatives. I believe that it is important for us as Canadians to have companies based here that are global leaders (D’Alessandro 2007-05-03).”

    2005-11-18 “CEO Mission to China Builds on Canada’s Strategic Partnership with the World’s Largest Emerging Market.” Seventeen senior business leaders representing a wide swath of the Canadian economy will arrive in Beijing on Sunday for a five-day mission to further the development of stronger trade and investment ties between Canada and the People’s Republic of China. Organized by the Canadian Council of Chief Executives (CCCE), the mission marks the first purely private sector visit to China by a broadly based group of chief executives from among Canada’s largest enterprises. “Since the Council several years ago designated China as a country of the highest strategic importance, we have continued to seek opportunities to build an ever-broader foundation of mutual trust and fruitful bilateral cooperation.” The mission is led by Mr. d’Aquino and Richard L. George, Chairman of the CCCE and President and Chief Executive Officer of Suncor Energy Inc. Other participants include the CEOs of AGF Management Limited, Bentall Capital LLP, Brookfield Asset Management Inc., Canadian Oil Sands Limited, CanWest Global Communications Corp., Enbridge Inc., Harvard Developments Inc., Palliser Furniture Ltd., Pengrowth Management Limited, Petro-Canada, Polygon Homes Ltd., Power Corporation of Canada and Yanke Group of Companies. The CEO mission to China follows the recent establishment of the Canada-China Strategic Partnership by the Right Honourable Paul Martin, Prime Minister of Canada, and His Excellency Hu Jintao, President of the People’s Republic of China. The Partnership, which was announced during President Hu’s visit to Ottawa in September, represents a watershed in relations between Canada and China, encompassing a wide range of bilateral and international areas. China is Canada’s second-largest trading partner, after the United States. The Canadian and Chinese governments have pledged to double bilateral trade within five years, to about $60 billion a year by 2010. The Canadian CEOs will spend three days in Beijing followed by two days in Shanghai. The agenda includes meetings with senior officials of the Ministry of Foreign Affairs, the Ministry of Commerce, the National Development and Reform Commission, China International Capital Corporation, the China Securities Regulatory Commission and CITIC Group. “The emergence of China as a world economic power is opening up huge trade and investment opportunities for Canada,” Mr. d’Aquino said. “The Canadian Council of Chief Executives is committed to working closely at home and abroad to transform opportunity into success.” The CCCE, founded in 1976, has been Canada’s private sector leader in the promotion of international trade and investment liberalization. Among other initiatives, the CCCE organized and hosted the first-ever APEC (Asia- Pacific Economic Cooperation) CEO Summit in 1997, during which it received His Excellency Jiang Zemin, then-President of China. The members of the CCCE include the chief executive officers of 150 leading Canadian corporations. These companies collectively administer close to $3.0 trillion in assets, have annual revenues of more than $650 billion and account for a significant majority of Canada’s private sector investment, exports, training and research and development. In addition to Mr. d’Aquino and Mr. George, the members of the CCCE’s Executive Committee are: Honorary Chairman A. Charles Baillie; and Vice-Chairmen Dominic D’Alessandro, Paul Desmarais, Jr., Jacques Lamarre, Gwyn Morgan and Gordon Nixon, the chief executives respectively of Manulife Financial, Power Corporation of Canada, SNC-Lavalin Group Inc., EnCana Corporation and Royal Bank of Canada.

    2009-09-01 “In a blockbuster [tentative] deal, privately owned Athabasca Oil Sands Corp. said PetroChina International Investment Co. Ltd. will buy a majority stake in its operations for $1.9 billion, marking the largest venture by China in the Canadian oilsands to date. [This is still to be reviewed by federal Industry Minister Tony Clement under the Investment Canada Act to evaluate the transaction’s net benefit to Canada.] Athabasca Oil Sands said the state-owned firm, one of the world’s most valuable oil and gas companies, will acquire a 60 per cent working interest in the MacKay River and Dover oilsands projects. “This deal shows that the biggest energy company in the world has chosen Athabasca as their partner,” chief executive and president Sveinung Svarte said in a conference call Monday. ” They clearly told us that’s because they like our assets the best and, obviously, they (the oilsands) are the crude oil story.” The two in-situ projects sit on approximately five billion barrels of bitumen that have yet to be developed, and are part of Athabasca’s almost 10 billion barrels of bitumen reserves. The play is one of the largest in the Athabasca region:about 121,400 hectares. “The reason we chose PetroChina over other some of the other bids was, obviously, their financial strength,” chairman Bill Gallacher said. “But also their technological capabilities related to heavy oil and(steam assisted gravity drainage), which we believe will benefit our project both efficiency-wise and production-wise (O’Meara 2009-09-01.”

    Who’s Who

    Bill Gallacher is Chair of the privately-owned Calgary-based Athabasca Oil Sands Corp which made a blockbuster deal with state-owned PetroChina International Investment Co. Ltd. -one of the world’s most valuable oil and gas companies- who will acquire a 60 per cent working interest for $1.9 billion in the MacKay River and Dover oilsands projects which Athabasca Oil Sands Corp will continue to operate, marking the largest venture by China in the Canadian oilsands to date. company said the projects, which it will continue to operate, will cost between $15 billion and $20 billion to develop. It has filed for provincial approval for both projects and intends to file an application for the first 35,000-barrel-per-day phase of MacKay River at the end of the year [. . .] Athabasca Oil Sands said it had notified federal and provincial officials on the proposed Chinese investment, which would make the foreign entity a majority stakeholder in the oilsands projects. Gallacher did not anticipate any issues to arise from the Competition Bureau on the deal. (O’Meara 2009-09-01.”

    Canadian Council of Chief Executives (CCCE), the mission marks the first purely private sector visit to China by a broadly based group of chief executives from among Canada’s largest enterprises. The (CCCE) founded in 1976, has been Canada’s private sector leader in the promotion of international trade and investment liberalization. The members of the CCCE include the chief executive officers of 150 leading Canadian corporations. These companies collectively administer close to $3.0 trillion in assets, have annual revenues of more than $650 billion and account for a significant majority of Canada’s private sector investment, exports, training and research and development. Among other initiatives, the CCCE organized and hosted the first-ever APEC (Asia- Pacific Economic Cooperation) CEO Summit in 1997, during which it received His Excellency Jiang Zemin, then-President of China. “Many of our members have friendships and commercial relationships in China stretching back years and in some cases decades,” said CCCE Chief Executive and President Thomas d’Aquino.

    Thomas d’Aquino is “President and Chief Executive of the Canadian Council of Chief Executives. He has been described by Peter C. Newman as “the most powerful influence on public policy formation in Canadian history”, and listed by historian Jack Granatstein as one of the 100 most influential Canadians of the twentieth century. A prolific writer and speaker, he has worked as special assistant to the Prime Minister, special counsel on international trade law and international advisor on strategic business problems (Northern Edge).”

    David Stewart-Patterson is the “CCCE’s Executive Vice President. He is also the author of Post Mortem: Why Canada’s Mail Won’t Move, described by the Financial Post as “rather like reading a less gentle version of one of Studs Terkel’s oral histories”. A former journalist, he has worked as parliamentary correspondent for The Globe and Mail‘s Report on Business and as business editor for CTV’s Canada AM (Northern Edge).”

    Northern Gateway project The multi-billion dollar proposed Enbridge Northern Gateway Project to transport 400,000 barrels of oil sand production involving a new twin pipeline system running from the oilsands in Alberta, to a new marine terminal in Kitimat, British Columbia to export petroleum and import condensate. In 2005-04-14 Enbridge CEO Patrick D. Daniel announced that Enbridge had entered into a memorandum of understanding with PetroChina International Company Limited to cooperate on the development of the Gateway Pipeline and supply of crude oil from Canada to China. Daniel noted that the agreement with PetroChina was built on the favourable environment for trade between Canada and China which was cultivated by [former] Prime Minister Paul Martin, and the efforts of [former] Alberta Premier Ralph Klein to stimulate Chinese interest in the oil sands.” The project was shelved in 2006 when the market cooled. By 2009 as China’s thirst for energy and need to secure supply has increased perhaps the Northern Gateway Project might be reconsidered ( (O’Meara 2009-09-01).”

    Enbridge Enbridge Inc. is involved in energy transportation and distribution in North America and internationally. As a transporter of energy, Enbridge operates, in Canada and the U.S., the world’s longest crude oil and liquids transportation system. The Company also has international operations and a growing involvement in the natural gas transmission and midstream businesses. As a distributor of energy, Enbridge owns and operates Canada’s largest natural gas distribution company, and provides distribution services in Ontario, Quebec, New Brunswick and New York State. Enbridge employs approximately 4,000 people, primarily in Canada, the U.S. and South America. Enbridge’s common shares trade on the Toronto Stock Exchange in Canada and on the New York Stock Exchange in the U.S. under the symbol ENB. Information about Enbridge is available on the Company’s web site at http://www.enbridge.com. Enbridge proposed the Northern Gateway Project and is involved in internal pipeline inspection and invests heavily in innovative leak detection technology. Enbridge has a computer system that can electronically monitor pipelines 24/7 from the Enbridge operations control centre. They also promise to put in safety control valves and leak detection systems to provide a strong safeguard for the environment.”

    Andrew Nikiforuk published Tar Sands: Dirty Oil and the Future of a Continent with Vancouver-based David Suzuki Foundation-Greystone Books in 2008 in which he argues that, “Canadian taxpayers, who made $150 million [Canadian] in royalties from mining activities between 1966 and 2002, have spent more than $4 billion tidying up scores of contaminated sites…” (2008:100)..

    Webliography and Bibliography

    D’Alessandro, Dominic. 2007. “How can we preserve Canadian ownership?Perspectives: 8.

    d’Aquino, Thomas and David Stewart-Patterson. Northern Edge: How Canadians Can Triumph in the Global Economy.

    Gelsi, Steve. 2009-09-01. “Energy stocks fall hard as broad market weighs.” MarketWatch. Issue:

    O’Meara, Dina. 2009. “China’s $1.9B Alberta oilsands deal: PetroChina partners with Athabasca Oil Sands.” Calgary Herald.

    RTTNews. 2009. “PetroChina To Acquire 60% Stake In Two Athabasca Oil-Sands Projects For US$1.7 Bln – Update.”

    Nikiforuk, Andrew. 2008. Tar Sands: Dirty Oil and the Future of a Continent. Vancouver: David Suzuki Foundation-Greystone Books.

    The Public Sector Equitable Compensation Act, a non-budgetary amendment to an act of Parliament, was introduced in the 550+ pages of the 2009 Budget Bill C-10 as part of a fast track process intended to boost the flailing economy. Most of the document dealt with issues not directly related to economic stimulus measures. In effect these proposed amendments involve 42 acts of Parliament that have no connection to the budget at all. The move has been called “legislation by stealth” (CFUW 2009-02-26) since there could be no parliamentary debate on the Public Sector Equitable Compensation Act as a new law independent of the Budget. It was hoped the Senate could stall passage of these amendments such as the proposed the Public Sector Equitable Compensation Act which would effectively dismantle decades of work towards ensuring pay equity. On March 12, 2009 Bill C-10, the Budget Implementation Act, 2009, received Royal Assent.

    “The new legislated criteria for evaluating “equitable compensation” will reintroduce sex discrimination into pay practices, rather than eliminate it. Under the Canadian Human Rights Act, it is a discriminatory practice for an employer to establish or maintain differences in wages between male and female employees employed in the same establishment who are performing work of equal value. In assessing the value of work performed by employees, the criterion to be applied is the composite of the skill, effort and responsibility required in the performance of the work and the conditions under which the work is performed (section 11). The new legislation adopts these criteria, but adds new ones that completely undermine the commitment to equal pay for work of equal value for women. Section 4(2)(b) of Public Sector Equitable Compensation Act adds that the value of the work performed is also to be assessed according to “the employer’s recruitment and retention needs in respect of employees in that job group or job class, taking into account the qualifications required to perform the work and the market forces operating in respect of employees with those qualifications.” This permits any evaluation to take into account that male-dominated jobs are valued more highly in the market, requiring the employer to pay more to attract new employees or retain current ones, even if the value of the work when it is assessed based on skill, effort and responsibility is no greater than that of female-dominated jobs. [T]he new legislation defines a female dominated group as one in which 70% of the workers are women; only these groups can seek “equitable compensation.” This is too rigid a definition as it simply puts outside the boundaries of the legislation those job groups in which women are 51 – 69% of the workers, no matter what the context is. [F]urther, unionized women cannot have the assistance of their unions to make pay equity complaints. Indeed, unions will be fined $50,000 if they assist any woman to make a complaint. We point out that this legal imposition of a fine violates international human rights norms, since it contravenes Article 9(3)(c) of the Declaration on the Rights of Human Rights Defenders. Article 9(3)(c) states that “everyone has the right, individually and in association with others, … [T]o offer and provide professionally qualified legal assistance or other relevant advice and assistance in defending human rights and fundamental freedoms.” ((CFUW 2009-02-26)

     

    In the Senate in early March 2009, Senators cautioned that only 27 of the 550-plus pages of the budget bill actually relate to the budget and economic stimulus measures. The rest involves making amendments to 42 acts of Parliament, many of which have no connection to the budget (PSAC. 2009-03-09).


     

    Timeline

    1977 The right to equal pay for work of equal value was introduced in Canadian federal human rights legislation to expunge sex discrimination inherent in market pay practices from assessment of value of work.

    2009-03-12. Bill C-10, the Budget Implementation Act, 2009 was passed in the Senate and received Royal Assent. This includes the amendment: Public Sector Equitable Compensation Act: Enactment of Act: 394. The Public Sector Equitable Compensation Act

    2009-03-23. Proceedings of the Standing Senate Committee on Human Rights: Issue 2 – Evidence. Ottawa, ON.

    Senator Nancy Ruth: If the bill [Bill C-10, the Budget Implementation Act, 2009] was passed in the Senate and has received Royal Assent [March 12, 2009], why are we studying anything in it?
    The Chair: Can you discuss that question with the leadership? We are not studying the bill. We were asked to study the subject matter. 

    2009-03-31 the Standing Committee on the Status of Women (Members of the Committee present: Sylvie Boucher, Patricia Davidson, Nicole Demers, Johanne Deschamps, Hon. Hedy Fry, Candice Hoeppner, Irene Mathyssen, Cathy McLeod, Hon. Anita Neville, Tilly O’Neill-Gordon and Lise Zarac) planned to hold four extra meetings to examine the Public Sector Equitable Compensation Act and invite Minister Vic Toews, the Public Sector Labour Relations Board, Public Service Alliance of Canada, Professional Institute of the Public Sector of Canada, Communications Energy and Paperworkers, Canadian Labour Congress and Marie-Thérèse Chicha, Pay Equity Task Force Member and any other witnesses that the Committee agrees upon.
    Notes

    1. PART 11: Public Sector Equitable Compensation Act: Enactment of Act: 394. The Public Sector Equitable Compensation Act is enacted as follows:

    An Act respecting the provision of equitable compensation in the public sector of Canada

    Whereas Parliament affirms that women in the public sector of Canada should receive equal pay for work of equal value;
    Whereas Parliament affirms that it is desirable to accomplish that goal through proactive means;
    And whereas employers in the public sector of Canada operate in a market-driven economy;
    Now, therefore, Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:

    Webliography and Bibliography

    Canadian Federation of University Women (CFUW). 2009-02-26. “Pay Equity Emptied of Meaning.”

    GC. 2009-03-12. Public Sector Equitable Compensation Act: Enactment of Act: 394. The Public Sector Equitable Compensation Act

    PSAC. 2009-03-09. “Senators on the right track with budget bill.”

    The credit crisis erased $14 trillion (McKeef 2008-12-31) from world stock markets in 2008. Where does $14 trillion in world stock markets go? How can that much capital disappear from the market? The infamous year 2008 will be known in the future as the year that fundamental concepts in the moral mathematics of the market were forever changed. This credit crisis was the worst since the Great Depression of the 1930s but its ramifications may be even deeper.

                                                                                                                                                                              
    100,000,000 dollars How can we visualize a billion dollars? How much more difficult is it to imagine a trillion dollars?

    The most recent wiki entry (2009-01-01) describes how any attempt to visualize numbers higher than a million is complicated because there are too systems of numeric names and the difference between the two scales grows as numbers get larger. Million is the same in both scales, but the long-scale billion is a thousand times larger than the short-scale billion, the long-scale trillion is a million times larger than the short-scale trillion. The short scale system is used in the US and a long scale system is used in the UK. The short scale system of numeric names means every new term greater than million is 1,000 times the previous term: “billion” means “a thousand millions” (109), “trillion” means “a thousand billions” (1012), and so on. Long scale refers to a system of numeric names in which every new term greater than million is 1,000,000 times the previous term: “billion” means “a million millions” (1012), “trillion” means “a million billions” (1018). (wiki).”

    6 zeros = 1 million, a thousand thousands or (106)1, 000, 000
    8 zeros = a hundred million (108) 100, 000, 000 this image
    9 zeros = 1 billion in the short scale system used in the US = a thousand millions or (109) or 1,000,000,000
    12 zeros = 1 trillion in the short scale system used in the US = “a thousand billions (1012) or 1,000,000,000,000
    12 zeros = 1 billion in the long scale system used in the UK: 1,000,000,000,000
    18 zeros = 1 trillion in the long scale system used in the UK is a million billions (1018) or 1,000,000,000,000,000,00


    1,000,000 6 zeros = 1 million, a thousand thousands or (106)1, 000, 000

    This Adobe Photoshop image posted in my ocean.flynn Flickr account was my attempt to visualize 100,000,000 dollars

     “World stock markets ended on an uptick for the year on Wednesday, after some bourses registered their worst annual losses in history. Global stocks as measured by the MSCI world index ended up 0.76 percent for the day and posted their first monthly gain in seven months, but lost 43.36 percent for the year. About $14 trillion (9.6 trillion pounds) in market capitalisation was erased from world stock markets in 2008 in the wake of the worst credit crisis since the Great Depression of the 1930s. “It has been a shocking year, hardly anything was spared in the carnage,” said Michael Heffernan, strategist at Austock Group in Australia. U.S. stocks edged up on Wednesday and saw their first monthly gain in five months, but the year has been the worst for Wall Street stocks since the Great Depression (McKeef 2008-12-31).”

    read more | digg story

    McKeef, Clive. 2008-12-31. “World stocks end up after historic losses.” Business News. Reuters.

    This could be the beginning of a new Robertson Davies’ novel.

    “The director of the National Gallery of Canada fired his deputy director for “just cause” — twice — in June and then found himself in Federal Court accused of being “medically” unfit to perform his job, according to previously secret court documents released yesterday (Gessell 2008-07-26).

    It is important that the Affadavit which Gallery upper management attempted to conceal, has not only been unsealed but is now available online at Affadavit of David Franklin and National Gallery of Canada and Pierre Theberge, Ottawa, ON. It is evident from the tone of the affadavit and even minute editing oversights and grammatical errors (unlike editing errors in this blog resulting from my desire to go outside and play), that David Franklin was distraught when he wrote it in collaboration with his legal council.

    It may prove to be a destroyer of careers and reputations.

    But the National Gallery of Canada is not a private organization. The 40, 000 plus works in the permanent collection belong to the public. It is a Crown Corporation.

    The Affadavit reveals far more than the possibility that an old man has outworn his usefulness, it reveals a culture of silence in the Gallery that has been a part the Gallery since at least 1997. Earning, achieving and maintaining an international reputation is crucial to this cultural institution. Thanks to the hard work of previous directors and current and previous curators, etc the National Gallery has achieved a great deal of credibility in ICOM particularly in regards to expertise in curating, conservation and restoration.

    David Franklin’s concerns about Theberge’s management style should be taken very seriously and investigated in-depth. Questions should be raised about the loss of curatorial expertise and productivity as valued, experienced curators were forced to retire early, castrated by the administration while remaining in the institution or leaving out of frustration because they lost favour with Pierre Theberge since 1997, not just recently under the guise of illness. Let’s not blame the disease for a style of governance that created havoc in the granite and glass building.

    Arts journalist noted in his blog that “Official advertisements seeking a replacement for the retiring Pierre Theberge have started appearing in newspapers. Far more emphasis is placed in the ad on management abilities than on knowledge of art. Maybe one of the government’s friends in the Calgary oil patch could take the job, assuming he or she was bilingual (Gessell 2008-05-21).”

    read more | digg story

    Excerpts from 2008- Affadavit of David Franklin and National Gallery of Canada and Pierre Theberge, Ottawa, ON.
    27. [David Franklin is] concerned that [he is] now the target of Mr. Theberge’s most recent effort to push someone out. [Pierre Theberge’s] motivation to remove [David Franklin’s] candidature for consideration as Director of the Gallery by blackening [his] professional reputation and terminating [his] employment for “just cause” unless [he] agrees to resign (Affadavit p.10)”

    4. “Mr. Theberge’s Medical Position:

    “Pierre Theberge suffers from Parkinson’s Disease. This fact has been known for several years by the Board, the senior management team and publicly. [David Franklin claimed that based on his own daily observations ] that Mr. Theberge’s medical condition has deteriorated rapidly over the past year [2007-2008] (Affadavit p.8)” “[ . . . David Franklin claimed that Pierre Theberge] “is no longer capable of performing the full duties that his position demands with the vigour or the proficiency that is required for the Director of a major Crown Corporation. Some of the symptoms that I have observed first hand are falling asleep during meetings, including one-on-one meetings; losing his temper with staff; acting erratically and reacting emotionally out of context; loss of memory; increasing nostalgia; short working days; inability to write his signature; difficulty concentrating and focusing on complex issues; lack of leadership qualities; contempt towards senior management; vindictiveness; violent mood swings; insulting and intimidating behaviour; appearing to be heavily medicated; requiring staff accompaniment at all times; requiring staff to prepare his meals at work; and occasional refusal to meet with major donors or be interviewed publicly due to deterioration in his public speaking abilities (Affadavit p.9)”

    Pierre Theberge management style:

    26. David Franklin “noticed a pattern whereby Mr. Theberge orchestrates the departure of curators from the Gallery. Mr. Theberge often seems to revere a given curator for a short while but then grows disenchanted with them to the point [where] he determines that they must be dismissed. Mr. Theberge regularly solicits negative gossip about Gallery employees and uses it against them when it suits his purposes. Unfortunately, Mr. Theberge seldom actually “fires” the people himself. Instead, he directs that the person is no longer to be supported in their work. In the past, I have seen him decide that he no longer values someone’s contributions and then start refusing approval for, canceling, blocking or reducing their exhibitions, acquisitions and even travel. This prevents the curator from being able to function in their job in any meaningful way and the person ends of leaving out of frustration. Mr. Theberge has also asked me to accelerate the early departure of curators near retirement whom he had taken a dislike to. I can think of at least three (Affadavit p.10)”

    Random notes:

    National Gallery of Canada is a Crown Corporation pursuant to the Museums Act, 1990, c. 3.

    National Gallery of Canada is also governed by the Financial Administration Act, RS, 1985, c. F-11.

    Pierre Théberge came to the NGC at the same time as outdated top-down business models already under scrutiny in more progressive sectors of the private sector were being embraced by those in positions of governance in the public sector. He did not invent his top-down parachute-in management style.

    The arms-length policies intended to protect Crown corporations like the National Gallery of Canada from unwarranted state intervention, are particularly vulnerable to abuse by upper management should certain types of management styles prevail.

    She was young, blond, trim, athletic, focused and fierce. She was hired by Bell to fire hundreds of employees in the 1990s and that was her opening remark in her first meeting with us along with, “If you don’t like it you can leave.” The aftermath of her arrival could only be described as tense. Everyone was tense all the time. I was so relieved I was not there anymore. She wasn’t a high-noon face-off girl. She was more like an execution squad facing powerless blind-folded victims. Those who were fired lost all rights to tell their stories openly. And there are so many stories to be told. Even today the image of security escorting friends trembling with shock carrying cardboard boxes sends shivers . . .

    But perhaps the greater sadness came as we watched valued and experienced curators and administrators leave of their own volition unable to accept a dictatorial management style that was so unlike the two predecessors. So many exhibitions canceled and with them years of research seemingly lost . . .

    Pierre Théberge’s arrival at the NGC in 1997 coincided with the formation of the National Gallery of Canada Foundation and with it fund-raising at the gallery reached new levels.

    Philanthropic foundations like the National Gallery of Canada Foundation created in 1997 are part of the golden age of philanthropy which is a global phenomenon. These new philanthropists are legal categorizations of nonprofit organizations that are highly specialized and concerned with measurable impact. Their work is strategic, market-conscious, knowledge-based, high-engagement and always involves maximizing leverage of the foundation’s assets.

    Pierre Théberge’s arrival at the NGC in 1997 also coincided with changes in the capital-gains tax which led to a sharp increase in donations. “Until 1997, the full normal capital- gains tax was due; reducing the “inclusion rate” to 50 per cent in 1997 led to a sharp increase in such donations. The federal finance department told Angus’s committee each foregone dollar in tax revenue was linked to $13 in extra giving. (Angus 2005-01-30).”

    Selected (subjective) timeline of events

    1970s Pierre Théberge worked at the National Gallery rising to the position of curator of contemporary Canadian art.

    1979 Pierre Théberge joined the Montreal Museum of Fine Arts as chief curator and later became director. He was nicknamed “Mr. Blockbuster” which can be considered as a derogatory term.

    1987-1997 Shirley Thomson, C.C. 2008 Laureate was born and raised in St. Mary’s, Ontario, she left a teaching job for Montreal and, ultimately, Paris, where she worked as an editor for NATO. She returned to Canada to become assistant secretary-general of World University Service of Canada (WUSC), and later assistant secretary-general of the Canadian Commission for UNESCO, working in the UN agency’s fields of education, science and culture. A decade later she was back in Montreal, enrolled at McGill as a Ph.D. student in art history, exploring the hunt theme in 18th-century palace decoration in France. Her McGill experience launched her career as a cultural administrator. As director of the McCord Museum (1982-1985), she turned a small university museum into a public research and teaching museum dedicated to the preservation, study and appreciation of Canadian history. After serving as secretary-general of the Canadian Commission for UNESCO, she was appointed director of the National Gallery of Canada in 1987. Dr. Thomson and her professional team developed, over the decade of her tenure, a strong program that helped raise the Gallery’s profile. She served as director of the Canada Council for the Arts from 1998 to 2002, and as chair of the Canadian Cultural Property Export Review Board from 2003 to 2007.” www.citizenvoices.gg.ca/_pdf/ReportArtMattersVisualMediaArts2008.pdf

    Colin Bailey was named as the National Gallery of Canada’s chief curator replacing Shirley Thomson.

    1995 David Franklin won the 1995 Eric Mitchell Prize for Rosso in Italy: The Italian Career of Rosso Fiorentino (published by Yale University Press, 1994)

    1995 David Franklin won the Governors’ Award for Yale University Press for best press book by an author under the age of forty.

    1997 The exhibition Renoir’s Portraits: Impressions of an Age, organized by the National Gallery of Canada in 1997, set a Gallery attendance record of 340,000 visitors.

    1997 The exhibition entitled Baroque to Neo-Classical: Sculpture in Quebec was held at the National Gallery of Canada from February through May, Vancouver Art Gallery from July to October and the Mendel Art Gallery in Saskatoon from October to January 1998. It was ten years in the making. Gallery director Shirley Thomson had charged Rene Villeneuve , Assistant Curator of Early Canadian Art with the task of mounting the exhibition in 1988 which was to cover Quebec sculpture from the 17th, 18th and 19th centuries. Villeneuve also wrote the research-intense 201 page exhibition catalogue by the same name. Twenty important works were restored for the exhibition. Charlie Hill provided Villeneuve with constant encouragement during the preparation of the exhibition which Thomson described as having “masterfully convey[ed] an important, rich, and indeed fundamental aspect of our culture, inherited from France (Thomson 1997:7).” With the arrival of Pierre Theberge, Villeneuve’s research and unique curatorial skills were no longer promoted with any enthusiasm.

    1997 Pierre Théberge, risk-taker in charge at Gallery: Pierre Theberge succeeds Thomson (Gessell 1997). Dr. Shirley Thomson was a popular director who treated everyone in her employ with respect.

    1997 Until 1997, the full normal capital- gains tax was due; reducing the “inclusion rate” to 50 per cent in 1997 led to a sharp increase in such donations. The federal finance department told Angus’s committee each foregone dollar in tax revenue was linked to $13 in extra giving. Angus believes the multiplier would be even greater if the capital-gains tax were dropped altogether (Angus 2005-01-30).”

    “The tax treatment of donations of shares is more favourable in the US than in Canada, and it was argued that the remaining capital gains tax on gifted securities in Canada should be eliminated. Since the 50% reduction in the capital gains tax for such gifts was eliminated in 1997, there has been a dramatic increase in donations. Eliminating the remaining 50% would stimulate even more. A member of the Council for Business and the Arts in Canada stated that, “the single most important step which the government can take to assist our arts organizations and every charitable sector, including health care, education and social services, to raise additional money, is to eliminate the remaining capital gains tax on gifts of listed securities.” (NACF 2002:6)

    1997 The NGC Foundation was created. Donald and Beth Sobey gave generously oftheir time and financial support through the Foundation.

    1997 The Audain Foundation was established. Michael Audain, Chairman of the Vancouver-based Polygon Homes Ltd., and his wife, Yoshiko Karasawa, are active supporters of the arts since the 1980s. Michael Audain served on the Vancouver Art Gallery board for many years, including in the role of president. Michael is now Chair of their Foundation. In 2004, Business for the Arts honoured Michael with the Edmund C. Bovey Award for leadership in the arts. He was appointed to the National Gallery of Canada Board of Trustees in 2005 and to the Order of British Columbia in 2007.

    1997-2009 Pierre Théberge served as director of the National Gallery of Canada, the second-longest term for a National Gallery director.

    1998 David Franklin joined the National Gallery as Curator of Prints and Drawings.

    NGC. 2000-04-03. “National Gallery of Canada Comes to Amicable Agreement with Educator Guides.” Press Release. NGC:Ottawa. http://www.national.gallery.ca/english/558_890.htm

    2000 Kitty Scott began working at the NGC in contemporary art where she found that the NGC collection did not include many works by highly sought after artists from Western Canada who were working in a complex way across film, photography, video and installation. There were no works by Janet Cardiff and George Bures Miller, or by the younger artists Brian Jungen, Geoffrey Farmer or Althea Thauberger at the time. She began to acquire more works by Jeff Wall and Rodney Graham as well as a film and a photographic series by Stan Douglas. http://www.canadianart.ca/art/features/2007/06/01/serpentine/

    2001-02-21 Pierre Théberge National Gallery of Canada Director and Curator Appointed to the Order of Canada

    2001-05-10 On May 10, 2001 200 technicians, installers and administrative staff at the National Gallery of Canada and the Canadian Museum of Contemporary Photography embarked went on the first general strike in the history of these institutions. It is noteworthy that David Franklin brought strikers doughnuts on the strike line (Geddes 2008-07-09). Relations between gallery staff and Pierre Theberge remained rocky ever since this strike.

    The strike was timed to coincide with an $1.8 million exhibition of the works of Austrian artist Gustav Klimt which opened on June 15. Strikers won the support of the public as well as prominent Canadian artists such as Michael Snow. And the strike seems to have attracted visitors since there were 500 more visitors than the projection figure of 18,000 for June! One of the areas of concern was the need for a corporate anti-harassment policy. Gallery administration spent lavishly to hire lawyers and security officers instead of tabling a fair offer. The red shoes displayed on the Gallery plaza have become the symbol of their strike. Red shoes became a symbol of solidarity as strikers “placed hundreds of pairs of donated footwear — painted a brilliant, scarlet hue — outside the museum (on Rideau Street) and gallery (on Sussex Drive) every day. […] The whimsical appearance of the red shoes inspired workers to create songs, poetry, T-shirts and posters, delighted passers-by, and garnered more frequent media attention than any conventional, non-violent protest action could ever have done (Bemben 2002).”

    “Art can be a form of action, and our picket lines can be seen as a work of performance art. In order to reinforce that concept, we, as a group, will create a collective work of art. Walking on the picket line is a burden on our feet, and our shoes become part of our plight. We are literally wearing out our shoes! […] By placing our old shoes next to us on the picket line, we are visually representing the many, many miles that we have walked, and the labour that goes into walking the line. We are labouring on behalf of labour. Our shoes also embody our individuality — they are personal artifacts. By painting our old shoes all the same shade of red, we are symbolizing our passion and solidarity as a group. […] Lately, our feet have been taking us in a different direction, but we hope to soon have a fair contract and be walking back inside our beloved institutions (Strike posters cited by Bemben 2002).”

    The NGC was forced to “postpone indefinitely an exhibition of work by Montreal photographer Pierre Boogaerts at the Canadian Museum of Contemporary Photography (part of the National Gallery). “Attendance to our permanent collections has been down,” admits Joanne Charette, the National Gallery’s public-affairs director. “We’ve had to cancel educational tours for students, which usually adds to our figures in May and June.” The strike was in full force when the museum’s Gustav Klimt exhibition opened on June 15. Charette says that attendance for the show, at 18,500 visitors in June, is actually above the projected figure of 18,000. The show cost Can. $1.8 million and required three years to organize. To compensate for the postponement of the Boogaerts show, the current exhibitions of work by Larry Towell and Diana Thorneycroft have been extended until September 3 (Jana 2001).”

    2003 NGC. 2003-09-23. “Board of Trustess Supports National Gallery of Canada Director. Press Release. NGC: Ottawa. http://www.national.gallery.ca/english/552_1072.htm

    2003 Attendance at the National Gallery of Canada 455,000, down 13 percent from 2002. http://www.national.gallery.ca/english/550_988.htm

    2003 Donald Sobey, entrepreneur and collector of Canadian art from Stellarton, Nova Scotia, donated $1 million gift through the “Donald and Beth Sobey Chief Curator’s Research Endowment. Under the guidance of the Gallery’s Chief Curator, Dr. David Franklin, this fund gives the National Gallery the opportunity to conduct and publish scholarly research of national and international scope (NGC. 2007-01-11).”

    2003-2004 “The Government increased the Gallery’s acquisitions budget in 2003-2004 to restore some of its lost purchasing power and allow it to continue building the national collection for future generations. The budget, supplemented by the generous support of the National Gallery of Canada Foundation, made possible several important purchases, including Quebec painter Ozias Leduc’s Portrait of Gertrude Leduc, Jacopo Pontormo’s Renaissance drawing Reclining Male Nude, and Douglas Gordon’s contemporary video work Play Dead: Real Time. The Gallery increased its holdings of First Nations and Inuit art with works including Norval Morisseau’s Observations of the Astral World and Brian Jungen’s whale skeleton sculpture Vienna.” http://www.national.gallery.ca/english/550_988.htm

    2004 David Franklin’s book entitled Treasures of the National Gallery of Canada

    2005-04-06 The appointment of Diana Nemiroff as the new Director of the Carleton University Art Gallery (CUAG) effective July 4 was announced. “Diana Nemiroff has garnered an international reputation in the contemporary art world. She has been a senior curator at the National Gallery of Canada since 1990 and has held assistant and associate curator positions with the Gallery since 1983 dealing mainly with contemporary and 20th-century art. She has organized many successful exhibitions including her favourite Crossings, a highly acclaimed 1998 exhibition of works in various media that examined the situation of people migrating from one country to another. The exhibition Land, Spirit, Power: First Nations at the National Gallery of Canada, which she organized with Charlotte Townsend-Gault and Robert Houle, broke new ground in the recognition of First Nations artists in Canada, and won the Janet Braide Memorial Award for its contributions to Canadian art history. Two of her exhibitions, 3 x 3: Flavin, Andre, Judd and Protean Picasso: Drawings and Prints from the Collection of the National Gallery of Canada [toured Canada in 2005]. She also planned and installed the collection of contemporary art for the opening of the National Gallery’s new building in 1988.” http://www.carleton.ca/duc/News/news04060501.html

    “Diana Nemiroff has been the director of the Carleton University Art Gallery since 2005. Before joining the staff of Carleton University, she worked for over 20 years at the National Gallery of Canada, where she developed a national reputation as a curator of contemporary art. She has numerous exhibitions to her credit, including recent monographic displays by Damian Moppett (2006), Lyne Lapointe (2007) and Pascal Grandmaison (2008). As a curator at the National Gallery, she has been recognized for her work on group exhibitions such as The Canadian Biennial of Contemporary Art / La biennale d’art contemporain canadien (1989); Land, Spirit, Power: First Nations at the National Gallery of Canada / Terre, esprit, pouvoir: les premières nations au Musée des beaux-arts du Canada (1992); Crossings / Traversées (1998); and Elusive Paradise: The Millennium Prize / Paradis insaisissables : le prix du millénaire (2001). These shows surveyed the national and international contemporary art scene, identifying issues around the presentation of Aboriginal art, globalization, and the environment, and how it has affected the art world in recent years.
    Diana Nemiroff was born in London, England, and was raised and educated in Montreal, where she studied at the École des beaux-arts, before earning both a bachelor’s degree in fine arts and a master’s degree at Concordia University. She is a board member of the Canadian Museums Association and is vice president of the University and College Art Galleries Association of Canada. In addition to her museum experience, she has a background as a critic and writer, and continues to write on contemporary and modern art for a variety of independent projects.” http://www.citizenvoices.gg.ca/_pdf/ReportArtMattersVisualMediaArts2008.pdf

    2005-05-28. The National Gallery of Canada Foundation held its first national fundraising event, the Renaissance Ball which generated one million dollars. Thomas d’Aquino, Chairman of the Foundation’s Board of Directors thanked Marie Claire Morin, President and CEO of the Foundation and her team and she in turn thanked thanked Thomas d’Aquino, saying, “Through his leadership, vision and commitment, Thomas d’Aquino accomplished an incredible feat by bringing together such a prestigious group of art patrons and philanthropists. Without him, the Renaissance Ball would simply not have been possible.”(NGC. 2005-06-03).

    2005 David Franklin’s “first big splash as chief curator was the exhibition Leonardo da Vinci, Michelangelo and the Renaissance in Florence. It was the Florence show that caught the eye of curators at Los Angeles’s J. Paul Getty Museum, leading them to partner with the National Gallery on a Bernini sculpture show, slated to open in [July of 2008] at the prestigious Getty, before moving to Ottawa for a fall and winter run (Geddes 2008).”

    2006 “Kitty Scott left her post as National Gallery curator of contemporary art [in 2006], in part, because of her frustration in getting gallery management to mount contemporary art exhibitions (Gessell 2008-06-10).” In a interview with Canadian Art she described changes that the NGC should consider, “In terms of contemporary art there needs to be more of it, both national and international. This means more exhibitions, acquisitions, publications, conferences and talks with artists, writers and theorists. The best institutions work closely with their curators, the experts, to bring these programs to fruition. And these programs must be seriously marketed—nationally and internationally—and use the Web in innovative ways. As well, I think the NGC would benefit from being more closely aligned with artists. Many museums have artists on their boards. I also believe that the NGC should play a more formative role in teaching students of museology, art history, conservation, museum management, design history, art and curating across Canada. I am sure universities would welcome this. And I think there could be stronger ties with the major collectors and dealers across the country. These people should be regarded as family and they should be made to feel more welcome. It would also be great if the National Gallery of Canada could develop relationships with other Canadian institutions so that the collection of contemporary art could be seen more widely. While the idea of summer exhibitions in Shawinigan is interesting, I wonder about it, practically speaking. Ottawa is already remote, as the number of people visiting the institution shows, so why explore even more remote territory? What is the logic? Why not open a small space in the heart of Montreal, or St. John’s for that matter?” http://www.canadianart.ca/art/features/2007/06/01/serpentine


    2006
    The National Gallery of Canada Foundation is extremely proud to announce an extraordinary gift of $2 million dollars for the creation of The Audain Endowment for Contemporary Canadian Art. The Audain Foundation, a British Columbia-based family trust, generously made this donation, the largest in the history of the National Gallery of Canada Foundation. “This fund will ensure that the National Gallery of Canada will have the ability to acquire Canadian contemporary art, and to focus on the unique talents of artists from Canada with an emphasis on British Columbia” says Pierre Théberge, Director of the National Gallery of Canada. “We wish to thank the Audain Foundation, and in particular Michael Audain and Yoshiko Karasawa, or their generous gift to the National Gallery and the visual arts commmunity.” “Canada from coast to coast has many important contemporary artists who deserve to be in the National Gallery’s collection, so our foundation is pleased to be able to give help in this regard,” said Michael Audain. “We are deeply grateful for this endowment, the single largest leadership gift to benefit living artists right across the country,” says Marie Claire Morin, President and CEO of the National Gallery of Canada Foundation. Established in 1997, The Audain Foundation has made grants to 25 organizations for projects related to the visual arts. Mr. Audain, Chairman of the Vancouver-based Polygon Homes Ltd., and his wife, Ms. Karasawa, have been active supporters of the arts for over 25 years. Serving on the Vancouver Art Gallery board from 1992 to 1998, including the role of president, Mr. Audain is now Chair of their Foundation. In 2004, the Council for Business and Arts honoured Mr. Audain with Canada’s Edmund C. Bovey Award for leadership in the arts. He was appointed to the National Gallery of Canada Board of Trustees in 2005. The National Gallery of Canada Foundation is dedicated to supporting the National Gallery and its affiliate, the Canadian Museum of Contemporary Photography, in fulfilling their mandates. By fostering strong partnerships, the Foundation provides the Gallery with the additional financial support required to lead Canada’s visual arts community locally, nationally and internationally. The blend of public support and private philanthropy enables the National Gallery of Canada to preserve and interpret Canada’s visual arts heritage.”

    2007 “Publication National Gallery of Canada Review V gets the support of the renowned Donald and Beth Sobey Chief Curator’s Research Endowment.” Mr. Sobey was Chairman of the NGC’s Board of Trustees and a member of the NGC Foundation’s Board of Directors. Donald Sobey was Chairman of the Board of Trustees, National Gallery of Canada; Director, Board of Directors, National Gallery of Canada Foundation; Member of the Founding Partner’s Circle of the National Gallery of Canada Foundation; Chairman Emeritus, Empire Company Limited; Director: Sobey Inc., Alliance Atlantis Communications Inc., Atlantic Shopping Centres Limited, High Liner Foods Incorporated and President of the Sobey Art Foundation (NGC. 2007-01-11).

    2007-12 Michael Audain, Chairman of the Vancouver-based Polygon Homes and his wife donated another $2 million to the NGC towards the creation of the Audain Curator of Indigenous Art Endowment. Combined gifts from the Audain Foundation have created a new threshold of $4 million for gifts by a single donor.

    2008-01? Pierre Theberge imminent retirement:

    “In early 2008 the Gallery took steps in relation to starting a search for a new Director to replace Mr. Theberge. The firm of Janet Wright and Associates Inc was hired to assist with the recruitment and selection process. It is well known within the Gallery and its Boards from comments made to me by Mr. Theberge that Mr. Theberge does not want to leave his position as Director of the Gallery. He is extremely distraught at the thought of leaving the Gallery and that a search is underway for a new Director to replace him. [David Franklin . . . ] believes that Mr, Theberge has and will continue to take whatever steps are within his power to delay the date on which he will ultimately be replaced and also to control who that person might eventually be for his own personal gain (Affadavit p.7).”

    2008-05 Arts journalist noted in his blog that “Official advertisements seeking a replacement for the retiring Pierre Theberge have started appearing in newspapers. Far more emphasis is placed in the ad on management abilities than on knowledge of art. Maybe one of the government’s friends in the Calgary oil patch could take the job, assuming he or she was bilingual (Gessell 2008-05-21).”

    2008-04-03 Pierre Theberge announced 10 job cuts, including five layoffs including highly regarded Anne Maheux, a senior paper conservator with more than 25 years of service. Among those laid off are three members of the Public Service Alliance of Canada (PSAC) and one member of the Professional Institute of Public Service of Canada (PIPSC).

    2008-04-16 The The Canadian Association of Emerging Conservators (CAEC-ACRE) argued that the removal of [Anne Maheux who has been constantly active in the conservation field, supervising paper conservation interns on a regular basis and contributing to conservation associations, research and publications] is ill advised. “Furthermore, the remaining senior paper conservator at the NGC, who is due to retire in a short period of time, has not for many years maintained a practice of taking on curriculum interns. The CAEC is concerned that after this gap in practice, the remaining senior paper conservator may not be willing and/or fully able to take over Ms. Maheux’s role as supervisor to future students in the NGC paper laboratory. In addition, the elimination of this position also brings forward the issue of succession planning, or lack thereof, a question which is central to the CAEC’s activities. With this loss in mind, one has to wonder what the state of the paper conservation department at the NGC will be in a few years.” http://caecacre.wordpress.com/2008/04/16/special-announcement/

    2008-04 “Dear Mr. Theberge, The membership of the Canadian Association for Conservation of Cultural Property wish to convey our shock and extreme disappointment over the National Gallery of Canada’s recent decision to eliminate a full time position in the Conservation/Restoration Laboratory. Works of art on paper are among the most fragile and unforgiving of the Gallery’s collections, and are readily subject to irreparable damage if handled inexpertly. The CAC finds it unthinkable that the Gallery would dismiss a Conservator as highly regarded nationally and internationally as Anne Maheux, and assure you that we believe that neither the Gallery’s impressive collections of works of art on paper nor its professional reputation will be well served by this short sighted decision. The letter of explanation delivered to Gallery staff notes that the aim of the cuts was a 5% reduction in the “least performing programs”. By what measure, we ask, is Ms. Maheux’s work considered to be “underperforming”? Ms. Maheux is widely regarded as one of the preeminent leaders in the field of conservation of works of art on paper worldwide. As well as a graduate of both Queens and Harvard Universities’ conservation programs, she is a fellow of the American Academy in Rome, an accredited member of the Canadian Association of Professional Conservators, a former President of this organization and member of our Board of Directors for many years. Her enormous commitment to her profession is self-evident. Among her many internationally significant accomplishments are her seminal research into the works of Degas, her contributions on development of mounting systems for oversized works, her work with contemporary works of art, and her efforts toward establishment of a federal Museums Policy. Colleagues with whom I have spoken are unanimous in describing her work as exemplary. The CAC urges you to reconsider the elimination of this position and the employment of Ms. Maheux personally. Not to do so will cause the Gallery’s reputation irreparable harm in the eyes of the Canadian conservation community. Sincerely, Dee A. Stubbs-Lee, President, CAC/ACCR CC: Mr. Donald R. Sobey – Chairperson of the Board of Trustees, National Gallery; Mr. David Franklin – Deputy Director and Chief Curator, National Gallery; Mr. Stephen Gritt – Chief, Restoration Conservation Laboratory, National Gallery; Ms. Lise Labine – Director, Human Resources, National Gallery.” http://www.cac-accr.ca/pdf/Ministerletter.pdf

    2007-07 to 2008-04 Mr. Baxter and the Strategic Review Committee undertook to reach a 5% budget reduction by “identifying the “lowest performing” programs, including staff in each part of the Gallery. As a result of the review process eight positions at the Gallery including the position of Assistant Curator of European and American Art occupied by Erika Dolphin who is part of the PIPSC union) were abolished (Affadavit p.11)” According to [David Franklin] Erika Dolphin’s layoff was justified because of “overlaps of expertise (Affadavit p.12)” and that “the business case for abolishing the position was sound, even though it resulted in more pressure to perform on those remaining in the department (Affadavit p.12).” The decision to abolish the position was “a business decision (Affadavit p.12).”

    According to [David Franklin] senior management discussed these layoffs very little but “the general feeling [. . .] was that people had not wanted to engage in layoffs, that there had been pressure from the Strategic Review Committee to cut the required 5%, and that the Strategic Review had been a very difficult process which resulted in decreased morale for Gallery senior management (Affadavit p.11)”

    2008-04-29 The PIPSC filed two grievances on behalf of Erika Dolphin.

    2008-05-08 PSAC. 2008-05-08. “Federal Program Reviews Mean Layoffs and Downgraded Services at the National Gallery of Canada.” Ottawa. “Jobs will be lost and corners will be cut at the National Gallery of Canada as a result of the federal government’s revolving “strategic review” of program spending in targeted departments and agencies across the federal government. Selected to undergo a review in 2007 along with 16 other departments and agencies, the National Gallery was directed to cut its budget by five per cent. Where the recent federal budget released in February referred to “better use of internal resources and administrative efficiencies” in the museums sector, the plain truth was announced by the Director of the National Gallery on April 3 when he announced 10 job cuts, including five layoffs – one of those to a senior paper conservator with more than 25 years of service. Among those laid off are three members of the Public Service Alliance of Canada (PSAC) and one member of the Professional Institute of Public Service of Canada (PIPSC). Director Pierre Thèberge also said the five per cent cut dictated by the strategic review process will necessitate other cuts that will have an impact on the Gallery’s publishing and marketing capacity. Events and exhibitions will have to be scaled back and training will also have to be curtailed, according to Thèberge. Reaction to the cuts, and in particular to the position of the senior paper conservator, has been swift. Numerous letters to Thèberge from senior gallery staff, trustees and conservators say the cuts call into question the gallery’s commitment and its ability to fulfill its mandate to expand and conserve its extensive collections. PSAC is currently considering a range of actions in response to the employer’s actions. Ed Cashman, PSAC Regional Executive Vice-President for the National Capital Region, argued that, “These cuts will not only hinder the Gallery’s ability to carry out its mandate, they will also have a significant impact on smaller museums across the country that rely on the gallery’s collections to draw visitors into their facilities.” http://www.newswire.ca/en/releases/archive/May2008/08/c6375.html?view=print

    2008 “The gallery’s contemporary art shows [1998-2008] have been largely limited to retrospectives of aging artists who generally did their best work half a century ago when Pierre Theberge was curator of contemporary Canadian art at the very institution he now heads. Examples in recent years: Alex Colville, Norval Morrisseau, Gathie Falk, Bette Goodwin (Gessell 2008-06-10).”

    2008 National Gallery promotes its blockbuster (June-September 200 8) called “The 1930s: The `New Man’” – which promises to be one of the most intriguing art shows of the year. Featuring more than 200 works by artists including Wassily Kandinsky, Max Ernst, Pablo Picasso, Salvador Dali, Alberto Giacometti, Joan Miro, Diego Rivera and many others, it looks at an era when Marxist and Fascist regimes in Russia, Germany and Italy were trying to create a “superman” without human weaknesses (Knelman 2008). This is a strange choice by a man known for his dictatorial management style. The 1930s has been the subject of major thematic exhibitions in Berlin, Vienna, Madrid, and Paris. The NGC version examines the connection between art and biology. “In the 1930s, biology became a force for change, often destructive, notably in its racist and eugenicist forms that sought to “improve” the human species. During this decade, the opposed concepts of the “degenerate” – or “mentally ill” – artist, as described by the Nazi ideology of the Third Reich, and the “superman” or “new man” became widespread. These ideologies were to have a profound influence on forms of art and representation.” The works presented in this exhibition come from private and public collections in Austria, Canada, the Czech Republic, Germany, Holland, Israel, Mexico, Russia, Spain, Switzerland, the United Kingdom, and the United States grouped under nine themes: Genesis, Convulsive Beauty, “The Will to Power”, The Making of “The New Man”, Mother Earth, The Appeal of Classicism, “Faces of our Time”, “Crowds and Power”, and The Charnel House. The organizing committee is chaired by the director of the National Gallery of Canada, Pierre Théberge. Its members comprise the following curators: Jean Clair, retired director of the Musée Picasso in Paris; Didier Ottinger, of the Centre Georges Pompidou; Constance Naubert-Riser, professor emeritus, Université de Montréal; Ann Thomas, the NGC’s Curator of Photography and the NGC’s director of National Outreach and International Relations, Mayo Graham, who acts as the committee’s coordinator. excerpts from http://national.gallery.ca/english/540_2091.htm

    2008-07-03 National Gallery director Pierre Théberge sent an email to gallery staff “dedicated one nondescript sentence to announcing deputy director David Franklin’s leave and two extensive paragraphs detailing the career achievements of his “interim” replacement, Mayo Graham, who worked closely with Mr. Théberge at the Montreal Museum of Fine Arts before following him to the gallery a decade ago. Some have even described Ms. Graham, who was serving as director of national outreach and international relations, as Mr. Théberge’s protégé. Sources close to the gallery said the current tensions are rumoured to have come out of a dispute between Mr. Franklin and Mr. Théberge over the planned dismissal of another employee, which then escalated into a rift between them and made Mr. Franklin feel unwelcome (Alphonso and Bradshaw 2008-07-18).” Although David Franklin often replaced Pierre Théberge in public relations they were not close colleagues. Mr. Blockbuster, Pierre Theberge promotes activities that are part of a movement within museums globally in the 1990s that are criticized by some as being categorize are part of the dumbing-down of museums. David Franklin is a scholar.

    It was widely believed that the two men were not close colleagues.

    2008-07-26
    Sealed documents were released revealing that David Franklin expressed grave concerns about the mental competency of Pierre Theberge who he argued should be immediately relieved of his duties as director of one of Canada’s most important cultural institutions (Gessell 2008-07-26). “(Gessell 2008-07-26).

    Webliography and Bibliography

    Alphonso, Caroline; Bradshaw, James. 2008-07-18. “Gallery’s dirty laundry receives private airing
    Federal Court seals file on application for judicial review of case involving dispute between top administrators at National Gallery
    .” Globe and Mail

    Angus, W. David. 2005-01-30. “A gift for givers.” Montreal Gazette.

    Bemben, Linda. 2002. “Poetry: Striking Red Shoes, An Introduction” Our Times.

    Gessell, Paul. 2008-07-26. “National Gallery feud revealed: Unsealed documents detail deep rancour at highest level.The Ottawa Citizen.

    Gessell, Paul. 2008-05-21. “But can he discuss art?” Art and the City.

    Gessell, Paul. 1997. “Risk-taker in charge at Gallery: Pierre Theberge succeeds Thomson.” The Ottawa Citizen.

    Gessell, Paul. 2008-06-10. “Let’s have a biennialArt and the City.

    2008-07-03. “National Gallery curator takes an indefinite leave.” The Ottawa Citizen.

    Gessell, Paul. 2008-07-17. “National gallery heads faceoff in court: Judge dismisses mystery case involving directors.” The Ottawa Citizen.

    Jana, Reena. 2001. “Staff Strike at the National Gallery of Canada.” Artforum International Magazine, New York, NY.

    Knelman, Martin. 2008-03-19. “Not coming to a gallery near you.” The Star.

    McCooey, Paula. 2008-07-18. “Day after secret court hearing, national gallery says all’s well.” The Ottawa Citizen. with files from Paul Gessell.

    NACF. 2002-09-18. “National Arts Centre Foundation. Roundtable on Philanthropy in the Performing Arts.” September 18, 2002. Public Policy Forum.

    NGC. 2000-04-03. “National Gallery of Canada Comes to Amicable Agreement with Educator Guides.” Press Release. NGC:Ottawa.

    NGC. 2001-02-21, “National Gallery of Canada Director and Curator Appointed to the Order of Canada.” Press Release. NGC:Ottawa.

    NGC. 2001-06-04. National Gallery of Canada and Canadian Museum of Contemporary Photography sign new agreement with the Professional Institute of Public Service of Canada.

    NGC. 2001-07-11. “Tentative agreement reached for PSAC members at the National Gallery of Canada.” Press Release. NGC: Ottawa

    CBC News. 2003-09-23. Gallery director under fire for $600,000 expense tab.”

    NGC. 2003-09-23. “Board of Trustees Supports National Gallery of Canada Director. Press Release. NGC: Ottawa.

    NGC. 2005-06-03. “One million dollars for the Renaissance Ball.” Press Release. NGC: Ottawa.

    NGC. 2006-06-20. “The National Gallery of Canada Foundation receives the most important financial gift of its history.” NGC: Ottawa.

    NGC. 2007-01-11. “Publication National Gallery of Canada Review V gets the support of the renowned Donald and Beth Sobey Chief Curator’s Research Endowment.” Press Release. NGC: Ottawa.

    Picard, André. 1997-11-22. “A Call to Alms: the New Face of Canada.The Toronto Star.

    Starn, Randolph. 2005. “A Historian’s Brief Guide to New Museum Studies.The American Historical Review. 110:1. Last accessed 2008-07-20.

    The article (2008-05-29) entitled “Is it “peak oil” or a speculative bubble? Neither, really” published in The Economist generated a robust on-line debate. It has been criticized for offering limited or overly simplistic scenarios: text book supply-demand [1] and its extreme variation peak oil and speculation. What about the weak US dollar some ask? See Lewis (2008-06-09) [4] What about the long list of factors listed in the most recent (2008-05-13) Oil Market Report of the International Energy Agency (IEA)? [2] And what about the role of the increasingly complex, volatile, unpredictable, interconnected and potentially destructive financial instruments that are now available to anyone with access to the Internet and capital? The bank of the world’s central banks is very concerned about public policy and their own role in managing (or not) these unmanageable instruments [3]. There was a time when economists could argue that the market would correct itself invisibly. Now all hands are wearing gloves, players are blindfolded and nothing is predictable and certainly not transparent.

    The OMR claimed that the system is self-adjusting to bring the market into balance as the bull market driven by demand potential that has outstripped the slow supply growth – notably non-OPEC. Prices had to rise to choke off demand growth (IEA 2008-05-13:3). Events such as accidents, unplanned or unannounced maintenance and technical problems (Canada and the US:, labour strikes (UK), political unrest (Iran), guerrilla activity (Nigeria), wars and weather-related (Canada) affected supply losses. US companies, in particular, had very low refinery activity allegedly due to maintenance and unplanned outages by Shell, Chevron, ExxonMobil, Valero and BP refineries all during the same period. Lower discretionary driving, more fuel-efficient cars, higher volumes of ethanol blended into the gasoline pool cut into some demand in the US. However, the poorest Americans in rural areas have begun to choose fuel over food to keep mobile. The emergence of other markets, including China of course, as net gasoline importers will offset the so-called gasoline crack. The OMR also indicated that many nation states fearful of even higher prices and concerned about supply security, have been rebuilding their inventories at any cost since January 2008. This has increased competition for oil, bolstered demand and increased price pressures in 2008. While Saudi Arabia is blamed for not increasing oil production to balance the supply-demand equation, one wonders at the maintenance requirements claimed by American oil refineries that have contributed to supply problems and record profits for their companies sustained during the same period.

    The rising price of oil has also been linked to the increasingly opaque and highly complex financial instruments, that oil executives, politicians, bankers or economists seem to be unable to fully understand and therefore control let alone manage. The unintended consequences of these financial instruments contributed to the mortgage meltdown and the credit crisis. The Bank for International Settlement report also warned of a major principal-agent problem as buyers of derivative and futures contracts lack skills and information required “to manage the risks inherent in the complex instruments they are buying?” (BIS 2007-05-29:9). The Economist‘s on-line forum [1] included a suggestion that technological and communications advances as a democratization of gambling have contributed to expanding the high-risk field of hedge funds (once only for the UHNW or oil industry elites) to include new, inexperienced and aggressive players who are unconcerned about unintended consequences. The increased competition and rates of return were already declining in 2006 leading to riskier and more aggressive hedging evident even in established banking institutions. Many neglect due diligence and are engaged in originating credit then transferring the risk exposure to others through securitisation or derivatives markets (BIS 2007-05-29:9).

    The Bank for International Settlement report also revealed concerns over a year ago that short-term inflation could lead to long-term inflation due to high crude oil commodity prices (BIS 2007-05-29:59).

    The Bank for International Settlements (BIS) report included “pivotal questions in terms of regulation of the oil commodities markets:

    1. What is the appropriate role of monetary and credit aggregates in the formulation of monetary policy?
    2. Assuming that occasional the credit-driven boom-bust cycles are possible, should the public sector seek to prevent the build-up of imbalances, or rather just clean up afterwards?

    “Indeed, in the light of massive and ongoing structural changes, it is not hard to argue that our understanding of economic processes may even be less today than it was in the past. On the real side of the economy, a combination of technological progress and globalisation has revolutionised production. On the financial side, new players, new instruments and new attitudes have proven equally revolutionary. And on the monetary side, increasingly independent central banks have changed dramatically in terms of both how they act and how they communicate with the public. In the midst of all this change, could anyone seriously contend that it is business as usual? There is, moreover, a special uncertainty in the area of monetary policy. While the commitment of central bankers to the pursuit of price stability has never been stronger, the role played by money and credit is being increasingly debated, against the backdrop of the uncertainty about the inflation process referred to above. For some central banks, and indeed many leading academics, neither money nor credit is thought to play any useful role in the conduct of monetary policy. For others, in contrast, the too rapid growth of such aggregates could be either a harbinger of inflation or the sign of a financially driven boom-bust cycle with its own unwelcome characteristics. Against this background, neither central banks nor the markets are likely to be infallible in their judgments. This has important implications. The implication for markets is that they must continue to do their own independent thinking. Simply looking into the mirror of the central banks’ convictions could well prove a dangerous strategy. The implication for policymakers is that they should continue to work on improving the resilience of the system to inevitable but unexpected shocks (BIS 2007-05-29:145-150).”

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    “In the light of history, it is both important and welcome that creditors and debtors increasingly realise the extent to which their fortunes are now intertwined.” (BIS 2007-05-29:9).

    Notes

    [1] Useful comment on The Economist article by ….Professor ???:

    “I might also add, in response to QueenElisabeth, that there is no reason to think inventories would be accumulating unless the futures price rose significantly above the spot price, as it does in many textbook examples indicating one way in which arbitrage drives the futures price into equivalence with the spot price. Since the world doesn’t often behave like textbook examples, the spot price is tracking the futures price closely because every up tick in the futures price causes an almost immediate decrease in supply (which is the part of the process that should lead to inventory accumulation), and a simultaneous increase in demand as buyers seek to avoid higher prices in the future. It’s the increase in demand in response to higher expected future prices, expectations created entirely by goings on in the futures market, that is keeping inventories low. The lack if inventory buildups, in other words, is no evidence of all that futures prices aren’t playing a role in rising oil prices, unless you believe the last word in financial theory can be found in the “derivatives” chapter of a Money, Banking and Financial Institutions textbook. Aside from the usual suspects seeking to exhonerate themselves, which tends to lead one toward the opposite conclusion they would have us reach, the fact that oil prices have risen by about 30% since mid-March suggests that something far more than supply and demand for use are driving oil prices to their current record levels. The coincidence of trouble in the CDO market and rapidly rising commodity prices, as the flow of funds quickens into areas that are less risky and promise higher returns than mortgage backed securities, such as highly liquid commodity derivitives, strenghtens the case for the speculation hypothesis even more. I might also add that, as a financial economist, I typically teach that futures play an important role in facillitating a more efficient inter-temporal allocation of goods that look to become more or less scarce in the future. If futures prices have no effect on the price of the underlying commodity, and therefore on efficient resource allocation, we should have no reluctance about drastically curtailing the market since they would then serve no meaningful economic function that couldn’t just as well be served by less volatile financial instruments like forward contract. If they do effect current prices, as I believe they do, then strict prohibitions against their use for certain puposes should seem no more out of the ordinary, given the importance of oil in determining the structure of the international division of labor, than–for instance–legal arrangements preventing private individuals who have no legitimate reason to be in the market from purchasing opium or plutonium. You can’t have it both ways: either futures prices drive current prices and play an important role in determining the distribution of income and allocation of resources, among many other things, or they’re just financial instruments that serve as substitutes for betting on athletic contests or political elections. If the latter is the case, why not work toward their elimination entirely, and the return to non-standardized forward contracts, which were the main hedging vehicle in oil markets prior to 1983? Of course, the price of forward contracts would serve just as well as futures to indicate what the market thinks is going to happen in the future, and what it would therefore be most prudent to do in the present. The argument made here, and by economists like Paul Krugman, focus on the absence of inventory buildups as evidence that speculation in oil futures is playing an insignificant role in the current run-up in oil prices. One would expect to see rising inventories only if the futures prices rose significantly above the spot price. The spot price has been tracking futures prices closely, however. Why? To put it as simply as possible, a rise in the futures price not only decreases supply, as those who have the commodity seek to withhold it from the market in order to get a higher price in the future, but also an increase in demand, as buyers seek to avoid the higher price in the future by buying in the present. The effect on spot prices is unambiguous, but the effect on the quantity of oil bought and sold should roughly offset. As a result, the price rises, the amount of oil bought and sold remains roughly constant, and inventories neither accumulate nor de-accumulate. It’s insane to attribute a 30% rise in oil prices since mid-March to increased demand for use. Speculation is playing a huge part in this current price run up, as it is in the market for many commodities.”

    [2]The Oil Market Report (OMR), published under the responsibility of the Executive Director and Secretariat of the International Energy Agency (IEA) provides an overview of the global oil market including a full disclosure of supply and demand.

    [3] A useful explanation of the complexity and volatility of the world economy and the confusion surrounding analysis based on supply and demand, can be found in the 77th annual report of the Bank for International Settlements (BIS).

    “[More] scepticism might be expressed about some of the purported benefits of having new players, new instruments and new business models, in particular the “originate and distribute” approach which has become so widespread. These developments have clear benefits, but they may also have side effects, with associated costs. In emerging market economies, the essential point is that liberalisation needs to be preceded by structural changes that will allow financial systems to remain resilient in the face of both domestic and external shocks. While much progress has been made, much more is still needed” (BIS 2007-05-29:151).

    [4] “The weak dollar has had very little impact on the rapid rise in energy prices, Eric Rosengren, president of the Boston Federal Reserve Bank, said today. Although the decline in the dollar against other currencies has been a popular explanation for oil’s record run, Rosengren said that the data show the increases in oil prices have far outstripped the pace of the slide of the dollar in recent years.” (Boston Globe 2008-06-10)

    [5]

    Excerpt from “Challenges in formulating a policy response” in BIS report:

    “There are a number of difficult and important questions facing central bankers, to which there are no agreed answers. A first issue has to do with the appropriate role of monetary and credit aggregates in the formulation of monetary policy. A second issue isclosely related: assuming that occasional credit-driven boom-bust cycles are possible, should the public sector seek to prevent thebuild-up of imbalances, or rather just clean up afterwards? Concerning the first issue, three schools of thought can be identified, each with at least some adherents in most central banks. A first school emphasises the short-run effects on inflation of gaps betweenaggregate demand and supply, with longer-run inflation trends being largely determined by expectations about such gaps. The role of money and credit is generally played down by this group. A second school attaches more importance to monetary developments in influencing longer-run trends in inflation. In practice, this would imply a continuing emphasis on the influence of demand-supply gaps on inflation, but with policy conclusions being systematically cross-checked against the monetary data. Finally, a third school of thought also attributes great importance to monetary, but above all credit, developments, albeit for a rather different reason. Adherents of this school become concerned when they see rapid growth of the aggregates along with rising asset prices, particularly if also associated with substantial and sustained deviations of spending patterns from traditional norms. They admit that the medium-term outcome could be rising inflation, but fear rather more that a boom-bust cycle might have significant economic costs, potentially including unwelcome deflation over a longer-term horizon. Both historical experience and intellectual fashion have played a role in these divergences. Adherents of the first school would contend that forecasts of inflation using gap methodology have proven reasonably accurate in many countries over many years. Their refusal to countenance any more formal role for money rests in part on the unsuccessful “monetarist” experiment of the 1970s, but also on the failure of econometric work to reveal a stable and causal relationship with inflation in their countries. Supporters of the second school of thought would note that their belief in the money-inflation nexus is deeply rooted in theory. Moreover, the Deutsche Bundesbank and the Swiss National Bank have been translating such beliefs into effective anti-inflationary policies for decades. The third school of thought has been influenced not just by pre-World War II business cycle theory but also by the wrenching historical experience of the booms and busts referred to earlier. While fashions come and go, it appears that the influence of the second and third schools has been growing. In recent years, a number of central banks, when raising policy rates, have cited concerns about very rapid growth in both credit and asset prices. A number of other central banks have announced their intention to lengthen their normal policy horizon, to allow them to better evaluate the full range of possible effects arising from their policies. Finally, almost everywhere, one hears reference being made to the “normalisation” of policy rates, a concept which logically implies that the appropriateness of policy cannot be judged on its short-run impact alone. Behind this shift in thinking have been a number of influences.”

    “Forecasting inflation using traditional methodologies has become more difficult everywhere. Central banks are therefore looking for new guideposts, and these include the use of monetary and credit aggregates. Indeed, research in some central banks has recently identified what appears to be a reliable relationship between their monetary aggregates and inflation over long periods. Moreover, with the passage of time, new crises and the further analysis of old ones have provided empirical evidence to support the specific arguments for concern expressed by the third school. Finally, as evidence has accumulated that the global economy is characterised both by many imbalances and by a flatter short-run Phillips curve, the potential economic losses in a subsequent downturn have also been revised upwards. In sum, the possible implications of getting policy wrong have grown. All of these factors have helped to spur debate, and even sometimes to change minds. A second question, eliciting diverse answers, is how best to deal with what seems to be the natural procyclicality of the financial system. Should policy sometimes lean against an upturn, even in the absence of inflationary pressures? And if so, how? Should it rather lean primarily against the subsequent downturn, and if so how? Or, reflecting our lack of understanding, and the shortcomings of each of the individual policy instruments we currently possess, should it do both, using a number of policy instruments simultaneously? Short of serious re-regulation of financial markets, which would create many harmful inefficiencies over time, this more pragmatic approach to procyclicality in the financial system might have much to recommend it.”

    “The principal argument for tightening monetary policy in the upswing is to moderate the excesses in economic and financial behaviour and, in so doing, contain the costs of the downturn. There are of course some significant practical difficulties with this approach. How do policymakers evaluate when imbalances are building up to such a size as to warrant action? What degree of tightening would be required to moderate market euphoria, and might it do serious harm to unaffected parts of the economy? These points have been made repeatedly, and validly, in connection with the hurdles that central bankers would face in targeting asset prices. But the suggestion being made here is different. It is rather to react when a number of indicators – not just asset prices but also credit growth and spending patterns – are simultaneously behaving in a manner that indicates increasing exposures. In principle, such a configuration of developments would be both rarer and easier to identify. Moreover, the more widespread the euphoria, the less worry there will be that tighter policy might inflict collateral damage on unaffected sectors. (BIS 2007-05-29:145-150).”

    Some useful terms

    Arbitrage < Trade and Freight: “The purchase of physicals or futures in one market against the sale of physicals or futures in another market in order to exploit price differentials between these markets. In moving physical oil between markets, the price differential has to be large enough to cover freight, insurance, volumetric loss and other handling charges. When this condition is met, the ‘arbitrage window’ is said to be open.” (OMR 2008-0

    Supply ‘Push’ < Trade and Freight: When trade is motivated by output surpluses at the point of origin often signalled by weakness in local refining margins and/or by weak relative prices.

    Bearish and Bullish < Prices: Factors which are likely to depress prices are defined as bearish while factors which are likely to raise prices are defined as bullish.


    Derivative contracts
    based on different types of assets such as oil commodities, equities (including private equities), interest rates, etc reduce the risk for one party by increasing it for another. By entering into contracts based on imagined or virtual futures, contracts attempt to manage risk by mitigating uncertainties based on the availability of the commodity (supply) or on price uncertainties (demand).

    Futures Contract < Prices: A regulated, legally binding agreement made on the trading floor of a futures exchange to buy or sell a fixed quantity of a commodity for delivery at a specified time and location in the future.

    Futures Transaction < Prices: Purchase or sale of a futures contract; exchange of a futures position for the physical or cash commodity.

    Hedge < Prices: A financial transaction to mitigate risk. For example, taking an equal and opposite position on the futures market to that held in physicals to reduce price exposure in physicals (see Short Position, Long Position, Basis Risk).

    Long Hedge < Prices: The purchase of futures or other paper contracts, against the sale of physicals (to reduce exposure to a price rise). Also called a Buying hedge. (See Short Hedge.)

    Long Position < Prices: The net exposure of a trader (or group of traders) when their bought (long) physical or paper exposure exceeds their sold (short) positions (see Short Position).

    NYMEX – Prices: New York Mercantile Exchange, the commodities futures exchange.

    Short Hedge < Prices: The sale of futures against the purchase of physicals (to reduce exposure when a price decline or bearish trend is perceived) (see Long Hedge).

    Short Position < Prices: The net exposure of a trader (or group of traders) when their sold (short) physical or paper exposure exceeds their bought (long) positions (see Long Position).

    Spot < Prices: A one-time open market transaction where physical oil or products are traded at current market rates. The term is also often used to refer to a front-month futures contract.

    A Selected Timeline of Related Critical Events

    1930-05-17 The Bank for International Settlements (BIS) was established as an international bank for central banks which promotes international monetary and financial cooperation and strongly advises caution against fraudulent schemes. It is still functional and valued as a source of research accuracy in 2008.

    1930s The Bank for International Settlements (BIS) acknowledged that economics is not a science as revealed in such glaring knowledge gaps as this lack of predictions of the Great Depression of the 1930s (BIS 2007-05-29:139).

    1970 “The Great Inflation in the 1970s took most commentators and policymakers completely by surprise, as did the pace of disinflation and the subsequent economic recovery after the problem was effectively confronted (BIS 2007-05-29:139).”

    1990s Economists were unable to predict the crises which affected Japan and Southeast Asia in the early and late 1990s (BIS 2007-05-29:139).

    1995 Due to a naive, under-regulated and poorly managed financial environment, Nick Leeson, a trader at an old respected financial institution, Barings Bank incurred a $1.3 B. loss for the bank causing its bankruptcy by making large, unauthorized investments in index futures trading.

    1998 In terms of microeconomics, economists were unable to predict the failure of LTCM in 1998, “the firm faced price shocks in various markets that were almost 10 times larger than might reasonably have been expected based on previous history. As a result, its fundamental assumptions – that it was adequately diversified, had ample liquidity and was well capitalised – all proved disastrously wrong” (BIS 2007-05-29:139).

    2005-Q4 The combined turnover in the world’s derivatives exchanges for exchange-traded derivatives (ETD) and over-the-counter (OTC) derivatives was $344 USD trillion (Bank for International Settlements).

    2006 Buoyant economic growth from January through June 2006 led to concerns that the global economy might be approaching a “speed limit”. “Oil prices increased by more than 35% in dollar terms between February and August on the back of persistently strong demand growth. Moreover, signs that slack was evaporating in major economies gave rise to concerns about overheating. Long-term inflation expectations in financial markets rose temporarily in the first half of 2006, especially in the United States (see Chapter IV), and financial market volatility increased sharply, if briefly, in May (see Chapter VI).” (BIS 2007-05-29:12).

    2007-06 The total outstanding notional amount of over-the-counter (OTC) derivatives market was $516 trillion USD (Bank for International Settlements).

    2007-05 The Bank for International Settlement report revealed concerns that short-term inflation could lead to long-term inflation due to high crude oil commodity prices in the spring of 2007 (BIS 2007-05-29:59).”

    2008-01 through 2008-06 The price of oil on the futures markets climbed 40% between January and June 2008 (Lewis 2008-06-09).

    2008-06 “Oil’s six-year rally has gathered pace this year, with futures markets climbing by roughly 40 percent since January (Lewis 2008-06-09).”

    2008-06-06 The dollar plunged on Friday after U.S. economic data showed the biggest jump in the U.S. unemployment rate for 22 years, denting expectations the Federal Reserve would raise interest rates. It has been suggested that The weakness of the U.S. currency has been a major factor behind price gains across the commodities complex as dollar-denominated raw materials are relatively cheap for non-dollar buyers and offer investors a potential hedge against inflation. (Lewis 2008-06-09).

    2008-06-09 “Oil fell on Monday, but held close to record levels after the biggest one-day price gain in the history of the market left traders and analysts divided over the explanation (Lewis 2008-06-09).”

    Who’s Who

    The Bank for International Settlements (BIS) “is an international organisation which fosters international monetary and financial cooperation and serves as a bank for central banks. The BIS fulfils this mandate by acting as a forum to promote discussion and policy analysis among central banks and within the international financial community, a centre for economic and monetary research, a prime counterparty for central banks in their financial transactions and an agent or trustee in connection with international financial operations. The head office is in Basel, Switzerland and there are two representative offices: in the Hong Kong Special Administrative Region of the People’s Republic of China and in Mexico City. Established on 17 May 1930, the BIS is the world’s oldest international financial organisation. As its customers are central banks and international organisations, the BIS does not accept deposits from, or provide financial services to, private individuals or corporate entities. The BIS strongly advises caution against fraudulent schemes.” Bernanke, an MIT professor appointed by President Bush to head the Federal Reserve is also on the Board of Directors of the Bank for International Settlements.

    Webliography and Bibliography

    2008-05-29. “Double, double, oil and trouble.” The Economist print edition.

    BIS. 2007-06-24. 77th Annual Report. Basel, Switzerland. 244 pp.

    International Energy Agency (IEA). 2008-05-13. “Oil Market Report (OMR).” PARIS, France.

    Krauss, Clifford. 2008-o6-09. “Rural U.S. Takes Worst Hit as Gas Tops $4 Average.” Business. New York Times.

    Lawler, Alex. 2008-06-10. “Oil’s record jump defies single explanation.” Reuters UK.

    Lewis, Barbara. 2008-06-09. “Oil falls after record $11 surge.” Reuters. Boston Globe.

    Ticker. 2008-06-10. “Rosengren: Dollar’s impact on oil is modest.” Boston Globe.

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    see also related webliography

    1965-2005 Between 1965 to 2005 there was no national US real-estate bust as home prices surpassed inflation by a percentage point or two on average. However local reversals have taken place and some cities have never recovered (Christie 2005).

    1973-5 US investors in the S&P 500 lost 14% in 1973 and 26% in 1974 but gained 37% in 1975 (Mann 2000).

    1970s “The additional grades or risk have arisen from the willingness to underwrite mortgages for more risky borrowers, encouraged by the democratization of credit since the 1970s. Lending to more risky borrowers is, by definition, more risky. More loans to risky borrowers increases the total amount of risk to be sold in the marketplace” (Mason and Rosner 2007).

    1980-1990 In Los Angeles real estate was turbocharged for nearly 10 years (Christie 2005).

    1985 In Peoria, Ill. a more traditional area the average home price fell from $60,800 in 1981 to $51,400 in 1985 partially because of strikes and lay-offs at Caterpillar, the city’s biggest employer (Christie 2005).

    1987 Canadian families saved 20 percent of their take-home pay (Ed 2007).
    1987 Stock market crash
    1988 In “oil patch” cities like Oklahoma City prices plummeted 26 percent from 1983 to 1988. They only returned to 1983 levels in 2003 fifteen years later. In Oklahoma City, the inflation-adjusted price in 1983 was $196,600. Today, it’s just $135,100 (Christie 2005).

    1988 Houston home prices fell 22 percent from $111,000 in 1983 to $86,800 in 1988 rebounded only in 2003. Counting inflation, the average Houston home, which cost just $159,700 in 2004, is actually worth less [in 2005] than it was [in 1983]. When, adjusted for inflation, a home cost about $219,000 in 1983 (Christie 2005).

    1988 – 1990s Real estate prices fell in Northern California first followed by the rest of the state “as employers fled, incomes dwindled, quakes rumbled, sales fell and prices slipped. [. . .] Silicon Valley’s housing market crashed into recession along with the state’s economy (Perkins 2001).

    1989-90 The notorious price bubble of 1989-90 was linked to central banks specifically the Bank of Japan. “The Japanese economy continued to suffer during the early 1990s, and remained in recession until the end of 1993. Nominal GDP growth rates, which had been around 7 percent during the bubble period, fell beginning in 1990 and by 1991-93 were close to zero. Profits in the manufacturing sector fell 24.5 percent in 1991 and 32.1 percent in 1992. Bankruptcies began to rise starting in the latter half of 1990; by 1992, bankruptcies with debt more than Y10 million totaled 14,569 cases. Failures of real estate firms or of firms engaged in “active fund management” constituted more than half the corporate bankruptcies in 1991 and 1992 (Miller 2001).”

    1991 Inflation-adjusted take-home pay in Canada froze to this level (Ed. 2007).”

    1992 A new car in Canada cost $20, 000.

    1992 – 2000 “Japan remained pretty stagnant in the last eight years, with the majority of the loss coming in the first two, when it eventually fell by more than 60%. There was never a big drop, just a constant and inexorable drift downward. Real estate prices plummeted, almost no Japanese company ended 1992 higher than it started 1990. In the interim, banks have failed (and if it weren’t for the financial props of the Japanese government, many more would have), and companies have had to reassess some of their basic assumptions, such as lifetime employment and large benefit packages” (Mann 2000).

    1996 There was a housing market reversal in Los Angeles with average house price dropping from $222,200 in 1990 to $176,300 in 1996, a loss of 20.7 percent. “Furthermore, those are nominal prices, not real values. To calculate the loss more realistically you would have to figure in the cost of inflation: $222,200 in 1990 would have been worth $266,700 in 1996 dollars, which means the actual loss for homeowners buying in 1990 and selling in 1996 was closer to 34 percent (Christie 2005).”

    1994- 1996 “In 1994, [Japanese] banks wrote off non-performing assets of Y5.7 trillion, exceeding the previous high of Y4.3 trillion in fiscal year 1993. As yet, no major bank has failed, although a number have reportedly encountered serious difficulties. In December, 1994, the Bank of Japan supervised the takeover of two credit cooperatives, the Tokyo Kyowa Credit Cooperative and the Anzen Credit Cooperative, through the creation of a bridge bank with government support. The Bank’s decision not to let these institutions fail and pay off depositors under the deposit guarantee program was based, largely, on concern for the potential systemic effects of a deposit payoff on public confidence in the banking system in general. The “jusen,” or housing finance banks, suffered the most serious problems; these institutions, which were typically organized and sponsored by major commercial banks and staffed, in part, by former officials from the Ministry of Finance, lost tens of billions of dollars as a result of the collapse of the price bubble, and became one of the most contentious political issues of the day during 1995-86 (Miller 2001)”.

    1996 “How do we know when irrational exuberance has unduly escalated asset values, which then become subject to unexpected and prolonged contractions as they have in Japan over the past decade? And how do we factor that assessment into monetary policy? We as central bankers need not be concerned if a collapsing financial asset bubble does not threaten to impair the real economy, its production, jobs, and price stability. Indeed, the sharp stock market break of 1987 had few negative consequences for the economy. But we should not underestimate or become complacent about the complexity of the interactions of asset markets and the economy. Thus, evaluating shifts in balance sheets generally, and in asset prices particularly, must be an integral part of the development of monetary policy.” – Alan Greenspan (December 5, 1996)**

    1998 There was a market correction in the United States in October of 1998.
    1992 – 2000 “Japan remained pretty stagnant in the last eight years, with the majority of the loss coming in the first two, when it eventually fell by more than 60%. There was never a big drop, just a constant and inexorable drift downward. Real estate prices plummeted, almost no Japanese company ended 1992 higher than it started 1990. In the interim, banks have failed (and if it weren’t for the financial props of the Japanese government, many more would have), and companies have had to reassess some of their basic assumptions, such as lifetime employment and large benefit packages” (Mann 2000).
    2004 British Columbia graduates from university have an average debt of $20, 000.
    2005 Real-estate investing spiked, pressuring prices upward. In Phoenix, according to Bill Jilbert, president and COO of the Coldwell Banker brokerage there, investors from Nevada and California have invaded the Arizona market, and “affordable housing has been pushed to extremes (Christie 2005).”
    2000 In Tampa Bay Florida, high risk adjustable-rate mortgages (ARM) made homes “seem affordable when wages stagnated as prices soared. They were just the ticket for cash-out refinancings and home equity credit lines that bought cars and swimming pools and paid off credit card debt. “What happened in a lot of expensive real estate markets is that first-time home buyers who felt they could not afford a home otherwise, took on a loan that had lower monthly payments than a traditional mortgage would have,” said Allen Fishbein, director of housing policy for the Consumer Federation of America. “They weren’t being underwritten on the basis of the borrower’s reasonable capacity to handle these loans.” The payments started out manageable, especially since many loans offered teaser rates. But borrowers are getting a lesson in what the word “adjustable” means. More than $130-billion in mortgages payments were reset in 2006″ In 2006 nearly a third of Tampa Bay mortgages were the high-risk varieties, up from 10 percent in 2003 (Huntley 2006).
    1991- 2005 “[I]ncreased complexity from increased grading of risk can also result in increased opacity. Risk that is more difficult to see, by virtue of complexity, is risk just the same. There are plenty of reasons to believe that the amount of risk in the marketplace has increased. Figure 3 shows that defaults on ABS and residential mortgage-backed securities (RMBS) increased substantially between 1991 and 2005” (Mason and Rosner 2007).
    2006 Fitch Global Structured Finance 1991-2005 Default Study revealed that, “the overwhelming majority of global structured finance defaults over the 1991-2005 period were from the U.S., accounting for more than 97 percent of the total. While the 1,000 U.S. defaults were mainly concentrated in the Asset-Backed Securities._ (ABS) sector, the 27 international defaults were primarily from the collateralized debt obligations (CDO) sector.” See Mason and Rosner (2007) warn that risk continues to increase, as ratings agencies revise their loss expectations to account for the dynamics of the mortgage meltdown. For instance, on March 27, Standard & Poor’s raised its expectation for losses on
    2006 In Florida millions of homeowners were warned of the mortgage meltdown in which they will “face a financial nightmare brought on by a combination of higher interest rates, risky mortgages and a housing market gone cold (Huntley 2006).
    2007 Since 1991 inflation-adjusted hourly wages rose only 10 cents (Ed. 2007).”
    2007 A new car in Canada cost $32,000 a 60 percent increase from 1992 (Ed. 2007).”
    2007Canadians collectively owe three quarters of a trillion dollars in personal debt. Canadian families not only have no savings, they draw on pension savings to make ends meet.

    “The result of the easy credit is that an average family now owes far more than it takes in. That means we remain solvent only so long as the book value of our assets — things like our home, pension funds or investments — continue to increase (Ed. 2007).”

    2007 British Columbia graduates from university have an average debt of $27, 000.

    2007 It is now acceptable for Canadian families to pay 60 percent of income to pay monthly payments of their home mortgages (Ed. 2007).

    2007 The British Columbia government will allow home owners who are over 55 to defer property tax payments for as long as they live. The government will claim unpaid taxes after you die or sell effectively placing the tax burden on the children (Ed. 2007).

    2007 “The number of corporate failures in Japan rose for the third month in a row totaling 896 cases in December up 18.2%. November flops were up 6.5% and the number of companies going belly up in October were up 7.8%. The amount of debts the insolvent companies left behind were up 30.6% to 463.09 billion yen (Belew 2007).

    2007 In March Bob Lawless reported in his blog that, “The folks at Automated Access to Court Electronic Records or AACER regularly collect data from all the bankruptcy courts for creditors and attorneys. They have a wealth of information that does not show up in the mainstream media. Most recently, they tell me that there were 58,640 total U.S. bankruptcy filings in February 2007 as compared to 55,088 total U.S. bankruptcy filings in January 2007. OK, that looks like a slight increase, but looks are deceiving. It’s actually a fairly hefty increase. The February filings were spread over only nineteen business days while the January filings were spread over twenty-one days. On a daily basis, the February filings were up 17.7% as compared to January (Lawless 2007).”

    2007 Jayson Seth analysed data in National Association of Realtors (NAR) June 24, 2007 report. Seth argues that “America’s easy-credit, quick-flipping, borrow-now-and-forget-the-consequences lifestyle is coming to an increasingly painful, grinding halt” and the “confidence of homebuilders is at a 16-year low (Seth 2007).”

    2007 Lawrence Yun, National Association of Realtors announced that the real estate market is softening due to psychological factors, tighter credit for subprime borrowers. NAR’s Lawrence Yun explained that since late 2006 housing sales have slowed as buyers double up with family, friends or just mortgage helper units in their homes to be able to pay for higher-priced homes.

    2007 Mason and Rosner (2007) warn that risk continues to increase, as ratings agencies revise their loss expectations to account for the dynamics of the mortgage meltdown. For instance, on March 27, Standard & Poor’s raised its expectation for losses on 1. “Residential mortgage-backed securities (RMBS) market has experienced significant changes [from 1997-2007]” Furthermore they caution that “structural changes in mortgage origination and servicing have interacted with complex RMBS and highly volatile CDO funding structures to place the U.S. housing market at risk. Equally as important, however, is that housing market weaknesses feed back through financial markets to further weaken financial instruments backing today’s CDOs. Decreased housing starts that will result from lower liquidity in the MBS sector will further weaken credit spreads and depress CDO and MBS issuance. This feedback mechanism can create imbalances in the U.S. economy that, if left unchecked, could lead to prolonged domestic economic implications for U.S. standing in the world economic order [. . .] The potential for prolonged economic difficulties that also interfere with home ownership in the United States raises significant public policy concerns. Already we are witnessing restructurings and layoffs at top financial institutions. More importantly, however, is the need to provide stable funding sources for economic growth. The biggest obstacle that we have identified is lack of transparency.” (Mason and Rosner 2007).

    2007 In a Marketplace interview Amy Scott asked interviewees about the disturbing consequences of the interconnections between banks, hedge funds, high risk mortgages and pension funds. In June two major hedge funds managed by the investment bank Bear Stearns, who purchased securities that were essentially a “repackaging of all kinds of risky mortgages” to tap into the subprime mortgage market are now verging on collapse as the number of borrowers defaulting on these mortgages increases. Joseph Mason explained that “this isn’t just a Wall Street problem. Your 401k or pension fund may be invested in similar mortgage-related securities.” The investor-base is broad and it is difficult to know who is at risk. “Investment managers don’t have to report their holdings. And unlike stocks, these securities aren’t quoted on an open market.” Mason has been a firm proponent of more transparency in financial dealings (Scott 2007).

    2010-05-06 According to a report entitled “The Microstructure of the ‘Flash Crash’: Flow Toxicity, Liquidity Crashes and the Probability of Informed Trading” in The Journal of Portfolio Management, “The ‘flash crash’ of May 6th 2010 was the second largest point swing (1,010.14 points) and the biggest one-day point decline (998.5 points) in the history of the Dow Jones Industrial Average. For a few minutes, $1 trillion in market value vanished.” Report authors argued that the ‘flash crash’ was the result of the new dynamics at play in the current market structure.”

    Easley, David, Lopez de Prado, Marcos M. and O’Hara, Maureen, “The Microstructure of the ‘Flash Crash’: Flow Toxicity, Liquidity Crashes and the Probability of Informed Trading.” (November 19, 2010). The Journal of Portfolio Management, Vol. 37, No. 2, pp. 118-128, Winter 2011. Available at SSRN: http://ssrn.com/abstract=1695041

    http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1695041

    See also article was written by Heather Stewart and Simon Goodley, for The Observer on Sunday 9th October 2011 00.06 Europe/London

    Credit crunch, Financial crisis, Financial sector, Banking, Global recession, Stock markets, Business, Lehman Brothers, Margaret Thatcher,