Monday, June 08, 2009
BC Rail: CN walked away $1.4 Billion to the good
.What lies buried under BC Rail's track beds?
Somebody had to have arranged for the huge profit CN quietly picked up on the side
By Kevin PotvinThe Republic - June 4, 2009
Even at the time of the auction, things looked strange. It was eventually sold to CN for $1 billion. The now-opposition NDP flew into a rage and the interior towns revolted. The government responded by insisting it had got a good deal for what had plainly been a money loser, as though it was the price they got and not the act of selling it that was the source of all the fuss
To allay these invented fears, Campbell hired the services of a third party auditing firm to test whether or not the government got a good deal. The tactic worked: the price became the issue. But even here, questions arose.
CN annually makes a healthy profit. Since its purchase of BC Rail, CN has been using up BC Rail’s losses against its own profits and saving, by the time it’s done, $1.3 billion in tax payments. It is the same, essentially, as profiting $1.7 billion, since the profit here is an after-tax profit. For this guaranteed $1.7 billion profit (there was no risk, after all, since the tax department would not likely change carry forward rules), CN paid the princely sum of $300 million. Let’s see: $300 million for a $1.7 billion guaranteed profit. The portion of the deal the auditor did look at, covering the cars and sheds, pales by comparison. We can see why the government failed to provide the auditor with sufficient information to be able to evaluate whether the public received fair value for the sale of the tax books portion of the BC Rail deal. Paying $300 million for something automatically guaranteed to be worth $1.7 billion is called theft, at least the way I was raised.
Not long after the closing of the deal, police showed up at the legislative building ...
CN walked away $1.4 billion to the good, and that whole part of the BC Rail deal has all along been obscured, distracted, and hidden, and remains to this day still largely unknown. It had to have taken a few of those thickened envelopes to so effectively paper over such a thing, I say to the grinning guy down the bar.
Read all of Kevin Potvin's excellent article HERE. He is referring to the Charles Rivers Fairness Report.
Special thanks to Anonymous whose comment tipped us off.
And now I see how the PAB trolls think that the railway was going broke.
It's beyond disgusting.
This case has only made sense, to me, when it was said long ago that, "this investigation has nothing to do with BC Rail".
Just like it was said that, "the Mulroney investigation, has nothing to do with air bus"...
Agreed. I was just saying to a friend that if the Opposition New Democrats had only said as part of their election campaign: "We, as government, would immediately open up the secret deal with CN" the May 12, 2009 election results would have been different.
A new judge? No, no, no! A new trial? Good grief, tell me it ain't so.
Even a new judge, in my opinion, is a step backward into further delays.
Interesting, what you say about this trial having nothing to do with BC Rail. I have always thought that it had very little to do with Basi, Virk, Basi but a whole heap to do with how things are done in the Campbell regime with, at that time, BCRail being the biggest blooper of so many big bloopers.
I mean, who could imagine that BCHydro would be deliberately hollowed out for bankruptcy(sale) in the future ... it's beyond my understanding except in terms of something I can think of as a prime example, i.e., BC Rail.
So I hope sincerely that Judge Bennett's years of work aren't tossed aside.
I wonder if you're referring to the trafficking charges which featured in the early phases of police investigation? Interesting how those charges were set aside, I agree.
That's almost as a good as sayINg "it's before the courts".
Any responsible company would step up to be accountable for a report issued under their name, no matter what happened to the staffers who wrote it (perhaps, er, they were fired because of its lack of authenticity/factuality? - if so, though, shouldn't Charles River Assoc. have set about to do a proper one?).
That they don't have the research files or drafts around is also unlikely. I think they're just trying to cover their asses, and it's maybe disappointing that Canadian journalists (and lwwyers) haven't pressed them for more information about the company's work on the report....or to find the staffers who apparently the company is pretending are responsible, instead of their own corporate name....
Makes me wonder who to call at the Boston Globe who might know how to start asking the right questions, and which corner to look in (or corner them in).....
"Mary, please don't call the sale of BC rail a blooper. It is, as with many others, a well planned, organized theft by the moneyed class, with Campbell being the key person making it all possible."
I second that suggestion!!!
The US Corporate subsidiary we know as CN wouldn't have wanted anything to do with BC Rail if it was the loser that the liaRs and the PABlum Brigade would have us believe. The greedy class has NO interest in acquiring LOSERS, even when as it it appears they are PAID to take them over!
How can people fall for this crap?
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