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I'm sititng in Room 253-D in the Centre Block of the House of Commons where, a few minutes ago, a special subcommittee of the House of Commons Standing Committee on Industry, Science, and Technology just got underway. This subcommitee has been set up to address the crisis faced by the automotive industry in Canada. We'll be here to 11 pm tonight listening to a broad range of witnesses from Ford, Mazda, unions, and a series of industry associations.

The chair of this committee is Georgetown (Ont.) MP Michael Chong. His riding is right in the thick of Ontario's car manufacturing area.

Also on this committee: Conservative MP Jeff Watson, the only car plant worker ever elected to the House of Commons; Conservative MPs Terence Young and Mike Wallace, from Oakville and Burlington respectively. Young has Ford's plant in his riding. Wallace has workers and plants for steel mills and auto assemblers. The Tories also have Mike Lake from Edmonton here. On the opposition side, it's Guelph's Frank Valeriote. Guelph has lots of auto industry including parts maker Linamar and Martha Hall Findlay, from Willowdale, used to represent Aurora, home of parts maker Magna. The NDP have Brian Masse from Windsor which,you might have heard, depends a lot on the auto industry. The BQ rep here is Robert Vincent.

In the early going, Ford is calling on feds to ditch their current scrappage program — which pays consumers who own a 10-year-old vehicle about $300 to scrap their car and buy a new one. Problem there, Ford says, is that most 10-year-old cars have a value of about $3,000. Ford says, boost the scrappage fee to about $3,500 and then you'll see some action. Ford — which is not asking for any government money, by the way — also says the credit crisis has got to be fixed. Ford hasn't securitized a car loan since 2006!

“First and foremost, we've got to clear up the credit markets,” Ford Canada CEO David Mandragon said.

A U.S. court is being asked to force a blogger to give up the IP addresses of those who commented anonymously at his blog as well as anyone who even viewed some content that is at the heart of a defamation action.

In response, some are prepared to argue that bloggers ought to afforded the same protections for anonymous sources that protect mainstream journalists (in the U.S. at least.)

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The case involves a Charlottesville, Va. blogger who is being sued over content at his blog. A Washington-based public interest group, The Public Citizen Litigation Group, has intervened in the case and issued a press release today about this, with this paragraph:

“One of our country’s founding values is that the person standing on the soapbox in the town square has the same freedom of speech they have at The New York Times or the Toledo Blade, for that matter,” [the PCLG] said. “Bloggers … may not be ‘traditional’ journalists but they play an integral part in the way people get their news today.”

One aspect of this case I find alarming, is the demand by the plaintiff for the IP addresses of anyone who even viewed the blog posting.

An IP or Internet Protocol address, for those not up on all their geeky goodness, is a unique number that identifies your computer on the Internet. It's how the Internet knows where to find you. Every device connected to the Internet is assigned an IP address while connected to the network. If you connect to the Internet from an Internet service provider (ISP), that ISP will tend to keep records or logs of what IP address was assigned to which customer at what time. That's how your activities on the Internet can be traced back to a physical location. There are ways to connect to the Internet without leaving what are essentially breadcrumbs for someone who really wants to find you but that's a topic for another day …

The bottom line for most users is that when you surf the Web or read a blog and you do nothing else, you probably don't expect, nor should you, that a judge somewhere might want to examine your name, address, and reasons for looking at that online content.

Here's a note from Paul Alan Levy of the PCLG:

Together with the ACLU of Virginia and the Thomas Jefferson Center for Freedom of Expression, we have intervened in the case mentioned a few days ago in which a plaintiff in a defamation case retaliated against a blogger who covered his defamation suit in less than flattering terms by sending a highly invasive subpoena that demands production of the blogger's communications with his sources, IP numbers of all who posted on his web site or even READ the web site. There have been only a handful of cases in which courts have addressed whether bloggers should be treated as journalists for the purpose of considering the reporters' privilege. We are also arguing that, in addition to protecting the commenters on the blog for the reasons usually argued — protecting their right of anonymous speech — posters on a journalists blog should be treated as “sources” whose disclosure violates the journalist's own rights…

In 1997, then rookie NDP MP Peter Stoffer was a bit surprised that Christmas parties on Parliament Hill were segregated affairs by party. The Liberals held theirs here, the Conservatives held their's there and so on. So Peter went out and bought a $1,000 worth of booze and chips, slipped notes under the doors of MPs and let everyone know there'd be an all–party party. Well, Stoffer's initiative paid off in spades.

Other MPs chipped in with party supplies and cash and now, Stoffer's All-Party Party has become one of the most popular events every year on the Hill and raises thousands for a good cause. This year, Stoffer says the All-Party Party should raise between $6,000 and $7,000 for The Leukemia Society.

The money mostly comes from sales of booze at the cash bar. A few hundred staffers, mostly young people who work for the politicians, attend and I'm embarrassed that I don't enough of them by name. Resolution for next year: Get to know more young, political staffers. Stoffer also hits up MPs for a $50 donation, whether they plan to attend or not. A little more than 200 MPs responded to Stoffer's call.

Here's some pics:

A couple of Quebecers: That's your (Montreal-born) correspondent with Bloc Quebecois MP Claude Bachand, his party's defence critic.

Nova Scotia NDP MP Peter Stoffer is master-of-ceremonies of his All-Party Party.

MIchael Ignatieff lets his staff out! From left, OLO staffers Christina Richard, Nina Haugh, Mike O'Shaughnessy, and J.F. Del Torchio.

It's kinda hard to top a guy in red serge playing a banjo — unless you're a guy in red serge playing a drum.

Are these guys ready to run the country? Of course, they are! From left, NDP press secretary Jesse Brady, MP Charlie Angus aide Jeremy Huws, and NDP Senior Press Secretary Karl Belanger.

Check out the rest of the photo album.

Auto analyst Dennis Desrosiers is amazed (and not in a good way) at some of the dumb things the auto industry does. He sent around a note yesterday titled “The Automotive World Has Gone Mad” with examples of some of the strange decisions auto execs and policymakers have made and are making. Here's some excerpts (*See the bottom of the note for some explanations of acronyms and terms):

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• A Detroit – 3 CAW worker comes home early and finds a strange car in their driveway. Curious he checks out this out and finds his spouse in bed with a complete stranger. The worker goes back to work and GM / Ford / Chrysler files the divorce papers for the worker and pays the legal costs for the divorce… or at least part of the legal cost. Why are the D-3 paying for CAW workers' divorces
• Scrappage programs are proven to be an effective way to get older vehicles off the road and to stimulate sales and improve the environment. Our Government launches a scrappage program which gives a consumer $300 dollars to get rid of an older vehicle that is worth $2,000 and they don't even get the $300 dollars instead they get a certificate to buy a bicycle. And our Government wonders why the market is not responding?
• The pension funds of the D-3 are under-funded by billions of dollars and Governments may have to make up the difference. But CAW workers don't contribute to their pension funds. Why should Governments have to fund pension plans for workers who don't contribute to their own pensions.
• Governments are forcing vehicle companies to build vehicles that consumers are unlikely to ever buy. Has anyone looked at hybrid sales this year now that gas prices are low again.
• We have the near identical vehicles for sale in both Canada and the US. About 60 percent of Canadians bought a small fuel-efficient vehicle but only 28 percent of Americans. Yet politicians in the US claim the OEMs do not have a fuel-efficient product mix in the US. If this is true then how in the heck did Canadians find these products to buy?
• Vehicles per driving age population in the US at 101 percent while in Canada it is only 74 percent. I believe the transportation needs in Canada are being filled quite adequately with this lower level of ownership … how is it that Americans need 101 percent ownership?
• For most of the last two decades the dealers in Canada fighting tooth and nail to keep our chartered banks out of leasing and in a matter of months ( when their own OEM leasing companies cut back on funding of leases ) begin to lobby our Government to allow banks to begin leasing vehicles possibly creating thousands of potential competitors ( each and every bank branch in theory ) leasing new vehicles.
• Ford in the US saying they are in better shape than GM because their sales were only down 49.5 percent and GM's were down by 53.1 percent. Chrysler Canada leading their press release with the fact they are the number one selling vehicle company in Canada and ignoring the fact that their sales were down 27.0 percent.
• Labour featherbedding their contracts to the N’th degree and then standing up and declaring they aren’t part of the problem because their hourly wage is the same as Toyota who has zero featherbedding with their workforce.

CAW – Canadian Auto Workers, the union representing a lot employees at the D-3. Honda and Toyota manufacturing employees in Canada are not represented by the CAW.

Detroit-3 or D-3 refers to the three car companies who had their corporate roots in Detroit: General Motors, Ford, and Chrysler

OEM – Original Equipment Manufacturer

The Bank of Canada hopes the answer to that question is a resounding yes. But here's the funny thing about borrowing money: Whether your rate is zero per cent or 10 per cent or 50 per cent, you still have to pay the money back …

The Bank of Canada made a bet Tuesday that, if interest rates were virtually zero, businesses might be more inclined to borrow to build new factories, buy new equipment, and put unemployed Canadians back to work.

The central bank lowered its key overnight rate Tuesday to 0.5 per cent — a record low — and many observers say the bank could even take the rate as low as it could go, to zero, in all all-out effort to make it cheaper and easier for commercial banks to lend money and spur economic growth.

Several commercial banks did lower some of their interest rates within hours of central bank's announcement.

But the new, lower rates are unlikely, by themselves, to get the economy moving again.

“You can have the cheapest money in the world, but if people keep reading about the layoffs and falling housing prices, that takes away confidence and makes people much more cautious about borrowing, and leaves all the stimulus that you're trying to put in place basically on the sidelines,” said Warren Jestin, chief economist at The Bank of Nova Scotia. [Read the rest of the story]

Technorati Tags: banks, economic stimulus, economy, Bank of Canada, warren jestin

Gross Domestic Product or GDP is the sum total of a country's economic activity. It should always be getting bigger. When GDP shrinks, that's a bad thing. When it shrinks a lot — as the U.S. and Canadian economies did for the three months ending Dec. 31, 2008 — that's a really bad thing:

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It’s almost as if someone turned out the lights on Canada’s economy after October. November saw a 0.7% monthly drop in real GDP, and December followed up with a 1.0% decline. The cumulative two month decline was by far the worst since that particular series began in 1997, but also eclipsed the worst two month plunge in the early 1980s recession under the measure used at that time. Only the public sector was still growing in December. Financial markets have every reason to be concerned by the very steep pace of decline.
– Avery Shenfeld, CIBC Capital Markets

While the Canadian economy succumbed to the global pressures in the last quarter of 2008, it still remains amongst the best performing countries across the globe, and managed to outstrip a 6.2% decline in the U.S. However, the fourth quarter marks just the beginning of Canada’s recession. As producers attempt to correct for the unintended inventory build up, and as falling income puts further downward pressure on the domestic economy, we expect at least a 5% decline in the first quarter of 2009, to lead an overall annual decline of 2.2% in 2009.
–Diana Petramala, TD Bank

One would be stretched to find any good news in today’s dismal GDP report, with the economy recording its biggest quarterly retrenchment since the recession of the early 1990s (-3.4% q/q annualized). Moreover, the much larger-than-expected drop in December GDP (-1.0% m/m), the biggest monthly decline since the recession of the early 1980s, points to an accelerating pace of deterioration into the New Year. We now expect an output decline in the first quarter which is at least as large, if not larger, than in the fourth.
– Adrienne Warren, Scotia Capital

The decline in Q4 GDP was well in excess of the 2.3% drop projected by the Bank of Canada in its January Monetary Policy Report Update. They had suggested that the first quarter might even show a greater decline of -4.8%, which does allow the central bank to argue that the weakness in growth may be hitting the economy sooner than anticipated. However, the steady decline in monthly growth through the fourth quarter suggests little indication that the pace of decline is poised to reverse going into 2009. As a result, we expect that the Bank of Canada will opt to cut the overnight rate another 50 basis points to 0.50% following tomorrow’s policy-setting meeting.
– Paul Ferley, RBC Economics Research

“My own belief is if we were going to have some kind of big crash or recession, we probably would have had it by now.”
Prime Minister Stephen Harper speaking in Ottawa, Sept. 15, 2008, just two weeks before the beginning of that now-infamous fourth quarter.

I posted a new photo to AlbumArtMuseum.