Last week, Economy Shoe Shop owner Victor Syperek complained to Chronicle-Herald reporter Remo Zaccagna about the hole in the ground over on Argyle Street, the approved but unbuilt convention centre complex, which has become a cesspool overrun with rats.
Zaccagna went on to interview developer Joe Ramia, who admitted that he has no tenant for the "financial centre" part of the convention centre complex, which is why nothing positive is happening on the Argyle lot.
This is a wonderful metaphor for Nova Scotia's economic development strategy, which too often leads directly to a rat-infested cesspool.
See, after two decades of deregulation, the invention of complex derivatives ---financial side bets like Collateralized Debt Obligations and Credit Default Swaps---and the creation of global capital markets with no controls whatsoever, the world financial industry was booming, at least on paper, and our local mucky-mucks decided to hitch our economic horse to the continued growth of the false economy of derivatives. Halifax would be "the next Singapore," they promised; big banks would set up shop downtown and hire Dal Business School grads to shill bullshit Triple-A rated bonds to pension fund managing schmucks in Ohio, or wherever.
All that was needed was a nice taxpayer subsidized office tower, and so Ramia stepped up to the plate offering just that as part of the convention centre complex---and the city, provincial and federal governments agreed to subsidize Ramia's centre for $383 million over 25 years, valuing Ramia's contribution at $500 million.
Interestingly, the day after Zaccagna interviewed Ramia came news that the giant investment bank MF Global had, against all financial regulations, simply stolen $600 million of clients' money and bet it in the derivative market ---specifically, MF Global was betting the proposed European Central Bank and International Monetary Fund bailout of banks lending to the government of Greece would be a huge success. Whoops.
And yes, MF Global connects back to the Halifax convention centre: MF Global was created and run by Jon Corzine, one of the most insider-y and connected people in the entire global financial industry. Corzine was a former US senator and served as chairman and CEO of the world's largest financial corporation, Goldman Sachs, and so had been re-writing and gaming the rules for derivatives and influencing government-backed bailouts of financial firms for 30 years.
Of course Corzine bet that European banks would get bailed out---that's what the corrupt financial industry forces upon corrupt governments. Just in the last few years, the "recapitalizations," off-market accounting, emergency no-interest loans and other forms of bailing out of giant banks has totalled over $10 trillion. So making those bets on European debt made absolute sense to Corzine, and if he needed to steal some customer money to shore up the bets for a few days, who's going to be the wiser? Too bad for Corzine and his suckered customers that the Greek people and a busted investment class had other ideas.
Which brings us back to Nova Scotia. I don't know if Ramia will figure out a way to lure a tenant to his financial centre, but I do know this: If some big financial or insurance firm does move in, it'll be thanks to gigantic government bailouts somewhere along the way.
National governments long ago gave up sovereignty to the financial industry, so it's not inconceivable that, say, a British insurance company sets up offices in Halifax thanks to tax forgiveness in London. There's no doubt at all that our local mucky-mucks will insist that the new tenant get millions of dollars in on-going "payroll rebates." When I asked premier Darrell Dexter directly if he was prepared to subsidize a tenant for the financial centre he scoffed, telling me that "is a ridiculous question." We'll see.
Still, to this day, even in the face of an imploding global financial industry that is once again plunging the world and Canada into recession, our mucky-mucks continue to look at failed policies of shovelling the real money of taxpayers into the false economy of the global financial industry.
And this, and exactly this, is why the Occupy Nova Scotia encampment at Grand Parade is entirely relevant. This shit has got to stop.