Prime Minister Mark Carney and other Canadian prime ministers should be required to divest their investment portfolios when they assume office, not just put them in a blind trust, the House of Commons ethics committee recommends in a new report.
In its report made public Thursday morning, the committee said putting assets in a blind trust isn’t good enough, recommending instead “that the Government of Canada amend the Conflict of Interest Act that, for the application of subsection 27(1) the prime minister, as a reporting public office holder, is fully divested from their controlled assets through sale, since placement in a blind trust does not constitute true divestment.”
The committee also wants the law amended to require public disclosure of “high-level holdings categories placed in a blind trust by reporting public office holders (sector/asset class, and whether the holdings are Canadian-market concentrated),” a recommendation that could shed new light on the financial interests of a number of top officials and cabinet ministers.
While amending the law might be a good idea, doing it by firing baseless attacks in the back of the very people at the front line is IMHO despicable. The Conservatives are playing political games while the country needs serious leadership to face a global trade war. They always used “Potential” conflict of interest in their official communication because there is no actual fraud committed, a fact that allot of people in the comments seem to ignore. Get this, PP claims “Mark Carney is doing nothing and has signed no deals since in office” and in the same breath, he’s in conflict of interest… hum. Speaking with both sides of their mouth.
There is this… https://youtu.be/Gb_qMHGW68A
Ah yes armchair YouTuber clearly knows what they’re talking about. Scott Bessent is also a fucking idiot and serving about as corrupt a government as we will ever see in America so I wouldn’t believe a drip of the shit that falls out of his or any other American Republicans mouth.
That video was so stupid though. We really trying to get back on the one note PP train?
Carney also has a conflict of interest screen designed to prevent him from being involved in any decisions that could affect Brookfield Asset Management, Brookfield Corporation and Stripe.
Didn’t previously know about this, but how is that even supposed to be possible? Brookfield is massive. The idea that someone could lead foreign policy on trade and economics for Canada without affecting Brookfield just doesn’t make any sense. There’s no way to make important decisions and act as a leader on these types of topics without having an impact on Brookfield.
Regardless, his investments are in a blind trust. He hasn’t known what specific companies he is invested in since placing them in the trust. All he knows is what the overall performance of his investments is. That’s it.
There is a lot of misinformation and half information being thrown around about how blind trusts work, but the premise is as simple as that.
That’s a bit silly. Assuming his portfolio was well designed before it went into a trust, the asset manager is not going to entirely rebalance the portfolio. It would actually be irresponsible gor them to do so because of the size of costs it would incur to him via forcing realized taxable gains. Also, things like stock options aren’t tradable assets in the same way as simple equities. It’s true he won’t know exactly the composition of his portfolio now, but he’ll have a decent idea of it, and when he has to pay taxes on any asset sales he’ll have an idea of movesthat were made. He’s the opposite of a financial neophyte. And, wrt the ethics screen, it’s really silly to think it’s actually going to prevent him making decisions that would affect Brookfield or businesses owned by Brookfield. Brookfield is just too big with fingers in too many pies not to be affected by economic and trade policy.
You don’t have to assume any negative intent or abuse to recognize that the blind trust and the ethics screen are not sufficient.
I see what you’re getting at. We should figure out how to make someone asked to do that whole for their taxes owed as a result of selling. That would be a way to avoid potential conflicts arising
Yeah, we don’t want to financially punish someone for taking up public office, but we definitely need a better mechanism for preventing conflict of interests, especially in cases where someone is stepping into office from such a significant private sector life. That’s what I was getting at elsewhere in this discussion with my other comment about creating special funds for this purpose
No asset manager is going to completely up end an entire portfolio.
There’s no way to make important decisions and act as a leader on these types of topics without having an impact on Brookfield.
He’s already doing it. Dropping the DST and Carbon levy, steering Ottawa to fund AI projects. All benefit Brookfield more than Canada.
So the PM can’t have any investments?
This seems like overkill to me. Are they supposed to take the full capital gains hit and then stuff their money in a bank account while they’re PM?
What is insufficient about a blind trust?
What is insufficient about a blind trust?
A very naive question. Carney knows exactly what his investments are, and how his trust would be impacted by his policies in the longer term, post political career. Data centers? Ottawa spending on AI initiatives? Brookfield projects, what a coincidence.
A better question is why would a very wealthy man bother to become a civil servant?
Are they supposed to take the full capital gains hit and then stuff their money in a bank account while they’re PM?
Oh no, what precedent would a Prime Minister set for paying taxes? “Full capital gains hit” = half the income tax rate and a >$1M lifetime exemption.
People in this country just want a corrupt government, small wonder we have one.
Thank you for (a) insulting me, (b) belittling me, © providing incorrect information, (d) building a straw man, and (e) making an unrelated and silly conclusion.
No - Carney knows exactly what his investments were when they entered the blind trust. He does not know what they are now.
That’s very much not the case for his stock options, he will still know exactly what those are
Edit: after researching it, Carney’s stock options were included in the blind trust. This confirms he does not know what happens with them.
Regardless, options [to purchase stock] aren’t worth anything until they vest and are exercised by purchasing them. Unvested stock options are a promise by the company to allow the individual to purchase the options at a set rate once they vest. That’s it. They hold no immediate value. Generally breaking ties with a company means that your unvested options and RSUs are forfeit.
Just FYI it wasn’t me who downvoted you - but for one thing, Carney will obviously know the vesting schedule. Secondly, I almost don’t even want to entertain this claim because it’s just not how things work, but, if they aren’t worth anything, then why did Carney agree to be paid in stock options? And why is he holding onto them now, despite the criticisms?
In his book, Carney himself champions the idea of paying out things like executive bonuses in future options, because he says it incentivizes making decisions that will benefit the company over longer periods than just the next quarter or year.
The fact that it also creates a clear conflict of interest when that person suddenly jumps into government, well, that’s his own damn problem brought about by his own lack of forethought, and he should waive his right to exercise (or have the “blind” trust exercise) those stock options.
I see what you’re getting at. We should find a way to make people in this situation whole after forcing the sale of their positions when they enter the trust
I guess a 14 year old would believe this. Look up Brookfield’s track record on tax evasion. This group does not play by rules.
Carney is just another Harper.
No, someone who understands how blind trusts work would believe it. Brookfield and Carney have nothing to do with how blind trusts work and zero control over the investments in his. You’re free to be a crazy conspiracy theorist, but own it.
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They could just not be PM.
Exactly. If their money is more important than Canadian interests I’d rather them not be PM. (or even a politician)
Perfect so you’re team Poilievre, a political lifer who has done nothing else and has nothing to show for it over someone like Carney who became successful before entering politics?
I’m no fan of wealthy people making themselves richer on the public dime, but I also think that setting up barriers to entry for people who have achieved success in other areas is a losing proposition in the long term.
Of course we should have measures in place to prevent people from using their offices to enrich themselves, but to call for people to divest their portfolios as a pre-requisite could repel candidates whose experience and know-how in financial and economic matters might be of great benefit to us all.
Liquidating portfolios is no joke, 50% capital gains inclusion to income tax when triggering a distribution is more than enough to cause someone to reconsider running for office.
Perfect so you’re team Poilievre
We don’t need the turd sandwich or shit burrito choice. Poilievre promoted CDN government investing in crypto when he was a holding crypto.
Perfect so you’re team Poilievre
You seem like an ass.
I want a government where people are only in it to make Canada a better place. I have no problem with them getting paid enough to support their families, but there is no reason they should ever need to profit beyond that from their position. If they are in it for the money or fame they have no business in politics.
I agree with what you say here, but my original question was why he should be forced to sacrifice the investments he had before he was in power - and why putting them in a blind trust is insufficient to keep him from profiting from his decisions as PM.
Oh, I didn’t mean he should give up the value or anything. The point about capital gains tax is somewhat fair as well, but I think there could be ways around that. I’m not a finance expert, but maybe the capitals gains tax could be cancelled and his investments moved to a broad canadian index fund or something.
The problem with a blind trust (as I understand it) is that the existing investments aren’t going to be changed immediately or even soon, so he still could profit via policy decisions based on what he already had invested.
You guys are literally in favor of a policy that would have set barriers to entry to the guy who unseated the consensus favorite career politician after the last career politician fucked this country up well and good for ten years.
Had Carney been dissuaded by overly rigid policies like those being suggested here we would have had Poilievre in office for the Trump disaster. Wake the fuck up, ass.
So you’re saying that Carney doesn’t care enough about the future of Canada that he’d be willing to make sure he’s not in a position to personally profit from holding office?
That’s what the blind trust is for.
This is actively forcing people to take a loss by liquidating assets. It’s a weird idea to begin with. It won’t do much of anything but repel people who are independently successful by their own means.
And you think that people relying on a salary of a couple hundred thousand dollars as members of Parliament can mount campaigns on their own steam?
They cannot. So you won’t sit still for someone who is financially independent holding office without charging them to make sure they “care enough” but you’re okay with people who will need financial backing to get the job and then owe those people once they are in power?
And your original question is flawed to begin with. Do you not care enough about Canada to want the best person for the job, or is your anti-success prejudice more important to you than finding the best person for the job instead of the person who fits your narrow criteria?
Sorry dude, but I still feel that way. Carney has more than enough money to live comfortably without any more income for the rest of his life. If money is more important to him than Canada, then yeah I’d rather him not be PM. That doesn’t mean I like the conservatives, but if we never fix our political problems then people like Polievre will continue to be a problem forever.
No you’re missing the point on the Poilievre thing. I didn’t mean to imply that you would like conservatives, I’m saying that PeeWee Bumblefuck who lost his own riding and had to cobble together a face saving Alberta seat to remain quasi relevant is a career politician. Trudeau who was weak in almost every facet of his tenure was a career politician AND a nouveau aristocrat wealthfare baby.
Trudeau didn’t have to worry too much about assets because they were already locked into his inheritance.
Poilievre got elected before he had to shave regularly and has been nuzzling the public tit since.
Neither of those people are who we want to lead us, but the idea that we will be choosing socially responsible, wise and selfless leaders as PM if we force candidates to abide by a liquidation law is laughable. We will end up with career politicians or worse, career civil servants who are able to mount campaigns not because they are the sharpest minds available but because they know how the game is played and they are the most able to cut the throats of their opposition. Or perhaps we’ll have the odd child of a Laurentian aristocrat unfrill their sleeves and deign to spend their salad days playing Parliament.
I would rather the middle-class-raised, self-made-dynamo Mark Carneys of the world have a path to mount a campaign without the price being too high to make it worth their while, and these people are the ones who would be stung by this law, not the Trudeau aristocrats or PP government cheese mice.
Yes, why the fuck does a Prime Minister need additional investments while in office?
Its not like they will ever hurt for money again after they leave the position.
If you want successful people to hold office, you can’t make them divest their portfolios and take capital gains tax hits that could ostensibly cost them more than their salary and pension combined.
I know I know “boo hoo rich people” but if you think that Mark Carney is a good PM, why would you then set up a pre-requisite that repels people like him from even considering taking the position?
I don’t want “successful” people in office!
I want someone who has community building experience. Someone with non-profit experience. Someone with the interest of people not someone that has demonstrated a thorough understanding of how to acquire personal wealth.
We have financial and economic specialists to advise the PM, but we act like that’s the only fucking metric we can weigh our worth on.
I want a PM that is grateful for the opportunity to help Canadians and is humbled by the $400 000 salary as compensation, not someone that sees it as a small asset to their inflating portfolio.
Can we go higher on the salary, sure. Let’s make it $1milion a year.
But, who do we want running the country? I’d like someone with the guts to raise the salary, but also say that they’ll willingly dis-invest and put their assets in a blind trust.
Carney’s assets are in a blind trust. He has zero visibility into what investments he holds. All he knows is the overall performance of the total.
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That’s great, but I want someone who knows what they’re doing with the economy, and as valuable as community building is, it’s not a particular responsibility at the federal level.
It fucking should be. Running government as a business is what got the states into the fucking mess its in right now, and is also why all of our major infrastructure costs so fucking much compared to other countries.
We need a government that sees the current price gouging and foreign ownership of our resources as a bad thing, not as something that can benefit them personally.
Community building is a grassroots issue. I know a lot of community organizers who are fantastic people and good at what they do. I’m not sure they would do particularly well on the international stage.
But let’s say maybe they are great leaders and would do well as PM. Would it not be better to establish laws that take money out of the campaign landscape and level the playing field so that people like this are able to have a fighting chance? That doesn’t mean forcing them to liquidate once they’re elected. It means controlling the influence of wealth on campaigns and providing guidelines that socializes the campaign process.
If you force liquidation on the PM, you won’t solve the problem. You will just make sure that the average PM is a stooge. The guy who made his own fortune won’t bother with this shit, but the sleazy prick with nothing to lose, out the career politician with skeletons in their closet will damn well jump at the chance to gain power at the behest of anyone willing to throw money at their campaign.
You’re fixing the wrong problem. We want people with the wherewithal to become Carney-esque in the first place to run just as much as we want community organizers to have that opportunity, but placing barriers to entry to the former won’t ensure the latter gets the job.
Like I said, we have a job for that. Its called the Finance Minister. The Finance Minister should absolutely be an experienced economist laser focused on the economy. The Prime Minister should be taking the Finance Minister’s expertise into consideration, the same way they get expert advice from Foreign Affairs, National Defense, Agricultural, Industrial, Energy, and Environment Ministers.
The Prime Minister should be a leader for Canadians - the community of people that call this land our home - backed by the expert advice of their specialized ministers to best serve Canadians in all aspects of our lives. But the focus is always on them being a leader for our economy, which is a series of numbers that seeks to enrich the mean average which allows the rich to get richer and the poor get poorer so long as the rich can get more rich than the poor get poor. And we need someone who can temper the advise to make the average Canadian richer from the Finance Minister with the actual impact to Canadians. No community leader would ever yield “acceptable losses” to the the most vulnerable to benefit the well off.
I mean, that’s nonsense. You’re presupposing that a successful businessman or economist’s only asset is their financial knowledge. To gain the success that someone like Mark Carney has achieved takes a lot more than just financial knowledge. It takes leadership, vision, guts, tenacity, and many other qualities that would make them excellent PMs, as he has shown himself to be.
Your prejudice against financially successful people is not constructive. Just because people have leadership qualities that they have acquired through means other than financial success doesn’t mean that people who do enjoy financial success should be held away from leadership with a barrier to entry like this. It is flat out stupidity.
The article is about the idea that he should divest his assests so personally enriching himself is not a motivation for political action and your argument is that would dissuade people like him from taking office.
I’m saying people that seek power to personally enrich themselves that would be dissuaded from taking office if they couldn’t stand to profit beyond the salary are not the people I want as Prime Minister.
If you can’t see how someone refusing to divest their assets to be in a position of power could be a problem, I don’t know what to tell you, other than look south.
If the loss of assets is enough to prevent you from considering the position, I don’t want you in that position. The PM is supposed to make decisions good for Canada, not their assets in particular.
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It would be interesting to explore something like requiring a PM to liquidate assets they hold beyond things like a primary residence but making it free of any capital gains tax, then have a separate fund that tracks a basket of assets designed to be representative of the wealth and wellbeing of Canadians broadly but having an adjustable RoR based on broad measures of wellbeing. Could even make that available to all MPs and requiring ten years before divestment or something.
Totally just spitballing, but interesting to think of different ways of aligning incentives.
This is functional reform in a capitalist representative democracy. So it will never happen! I expect guillotines before accountability.
There’s more than one way to read “I expect to see guillotines before accountability.”
liquitate these assets, buddy
It’s insuffient because …
" … the prime minister, as a reporting public office holder, is fully divested from their controlled assets through sale, since placement in a blind trust does not constitute true divestment."
The committe is also advising revisions that will affect other officials and cabinet ministers …
The committee also wants the law amended to require public disclosure of “high-level holdings categories placed in a blind trust by reporting public office holders (sector/asset class, and whether the holdings are Canadian-market concentrated),” a recommendation that could shed new light on the financial interests of a number of top officials and cabinet ministers.
It’s all in the very short article link.
Well that’s something of a circular argument.
It’s absolutely true that placing investments in a blind trust isn’t divestment - but I didn’t really see why they considered full divestment (rather than a blind trust) necessary in the first place. The article made is sound like the committee just declared that as their goal.
Regardless, the public disclosure on a broader scale of politicians is a great idea. We deserve to see that.
Well their home is provided so I suppose they really have no need for assets while in power.
In addition to the other responses, a blind trust is especially insufficient in this case, since his remaining Brookfield stock options are only be able to be exercised in the future, meaning the operator of the blind trust cannot buy and sell them as they would with any other asset.
In other words, Carney knows the schedule of those options becoming available for him to exercise (or for the blind trust to exercise, depending on the schedule and whether or not he’s still in public office at that point), and the blind trust operator has no control over that schedule.
Brookfield, incidentally, has a lot of money invested in places like Qatar and the UAE, as well as tens of billions invested in AI and data centres worldwide. The value of his stock options, therefore, is tied to the value of those investments.
THANK YOU!
This is the first substantive reason that anyone has given. I hadn’t thought about deferred maturation.
That said, if they can’t be exercised, that usually means he can’t fully divest himself of them, so he’d be facing the same issue.
In either case, I guess the answer would have to be something like setting a fixed payment structure on them (maybe tied to a TSX index).
At the extreme end, forcing him to abandon all non-vested options wouldn’t be the end of the world.
At the extreme end, forcing him to abandon all non-vested options wouldn’t be the end of the world.
Honestly this is what I think should happen.
I mentioned this elsewhere, but Carney’s own book champions the idea of company managers/executives getting bonuses paid in things like future stock options, because he notes that it creates an incentive for that person to make decisions that are good for the company (or, I guess, for its stock price) on a longer time scale than “this quarter” or “this year”.
Well, turns out that same system also creates incentives for that person if they suddenly hop over into government. Carney only has himself to blame for this ending up as a conflict of interest.
If the trust cant sell them then he cant either?
I don’t see any reason why he couldn’t have signed away any claim on those stock options, or asked Brookfield to renegotiate things so he could cash out.
Some people might think it’s somehow unfair, but I mean, he wanted to be PM, no one made him do it.
Does the blind trust need his permission to renegotiate them though? Couldn’t they just do it?
Edit.
Or what if they costless collared them and effectively locked in the price on the date it went into the trust. Then it becomes this $x.xx is locked in at today’s price until you can exercise them, but you wont really make or lose any money on them between now and then.Edit: you need to own the underlying stock for the collar idea, not options.
And how do you pray tell prevent the blind trust from just rebuying what he had?
If they weren’t going to sell it once transferred, they’ll just rebuy it after?
Even if they did, he wouldn’t know and wouldn’t be able to benefit from it - unless there was an incredible amount of criminal fraud happening.
Exactly, so why make them sell it first? The moment the blind trust has it he has no idea if they sold it and cant really benefit, and if there’s any nudge nudge wink wink, thats criminal fraud.
That’s not even close to the same thing though.
The only real difference is the tax consequences of selling it. If you want to force PMs to pay taxes on it by selling it that’s one thing, but if the goal is just to have the trust be able to invest how they want, they could waive the taxes and let them make some special adjusted cost basis change, so whatever the trust invests in instead has an equivalent cost basis, not the current price.
The trusts know what PMs own before as it’s all disclosed. They are either going to keep it, or sell it as soon as they get it, and the PMs have no idea which.
Edit: neutralized the language as it’s about any future PM, not only this one.
You have a wildly inaccurate concept as to how blind trust operate. They’re not cutthroat aggressive day traders. The job of a blind trust is to shepherd a portfolio. It’s not that they’ll never sell anything because obviously they will sometimes but it would be rare for them to aggressively change a portfolio that was already successful. They are largely a conservative and non-reactionary concept. By the time a blind trust ends it would be wildly unusual for it not to look 90% the same as when it went in.
The idea that the PM would not generally know what was in his trust is just bonkers.
How is that going to change if they know what he had from public disclosures and they get a pile or cash instead? It wont.
If what you say is true, they’ll just rebuy the same successful portfolio and it’ll be 90% the same anyway.
That’d be the most conservative approach, dont change what they had that was working.
I’m perfectly okay with them just rebuying it afterwards. That’s fine by me. They’ll be buying it at a higher price. But that’s fair. The point is that they’re not materially benefiting while in office. If when they’re out of office they buy the things that they made stronger then that’s perfectly fine.
The corruption is the difference. The difference is them increasing the value of something while they hold a piece of it. If they don’t have it while they increase the value there’s no corruption, and assuming there’s no other quid pro quo.
