Sunday, July 28, 2013

(No.242) Executing the innocent as well as the guilty

" Executing the innocent as well as the guilty:
the death penalty as a punishment when errors cannot be remedied"

by Alastair Rickard

When I was a high school student I took part in a formal debate about capital punishment. I was on a team which opposed the imposition of the death penalty. My personal view was also against it.

I still am opposed to the death penalty but mainly today for a different reason than in that long ago debate. The use of the death penalty cannot be defended rationally; the error rate for conviction of capital crimes -- specifically in the U.S. but also Canada -- is too high.

Perhaps I would not today object to the death penalty per se as punishment for premeditated murder if society could be sure of the guilt of the convicted person to be executed -- but it cannot. Too few murderers are as certain candidates for execution as, say, Clifford Olson or Paul Bernardo. Therefore I am today still opposed to the death penalty

The reasons society cannot and should not impose the death penalty on convicted defendants include corrupt and faulty police practises in some cases, defective and/or  invalid forensic evidence, prosecutors more interested in a 'win' than in ensuring that justice is done, inadequate defence counsel for the accused, (in the U.S.) judges up for re-election, 'expert witness' testimony for the prosecution based on junk science (e.g., bite marks), false eyewitness testimony (a notoriously unreliable source), etc etc.

In the United States the Innocence Project recently celebrated the exoneration of the 200th inmate, 143 of whom were on death row awaiting execution. The availability in recent years of DNA evidence has been a major factor.

The magnitude of the challenge for the 35 organizations who are part of the "Innocence Network" is indicated by the fact that at the end of 2011 there were 3,082 persons on death row in the U.S. In both 2011 and 2012 43 executions took place, down from the peak of 98 in 1999.

Perhaps 60% of the U.S. public continue to favour the death penalty and, since its restoration to a part in the legal system by the U.S. Supreme Court after a four year hiatus, executions have resumed led by four states: Texas, Florida, California and Arizona. This quartet accounts for half of all inmates sentenced to death.

Many Americans oppose the death penalty, some of them for the same reason that I do -- the risk and the reality of the execution of people innocent of the crimes for which they have been convicted and sentenced to die. There are those -- including U.S. Supreme Court Justice Antonin Scalia -- who deny, in the face of evidence to the contrary, that innocent people are executed after being processed by the U.S. justice system.

This pro-death penalty support in the face of the evidence from the work of the Innocence Project and other such efforts is irrational to say the least. It is all the more so when one reads the views of various people close to the process. For example, Rev. Carroll Pickett the death house chaplain for 16 years in Texas who accompanied 95 people to the execution chamber.

We in Canada have nothing to feel smug about in comparison with our American neighbours. While Canada has not executed anyone since Arthur Lucas and Ronald Turpin were hanged back to back at the Don Jail in Toronto in 1962, we limped along with no end in law to the death penalty until 1976 for civilians and 1998 for the military.

Indeed so strong was and continues to be Canadian public opinion in support of restoring the death penalty (at least 61% in 1987 and 62% in 2009) that while a 1987 free vote in the House of Commons to restore the death penalty failed, it was not defeated by a huge vote (148 to 127).

Had Canada retained the active use of the death penalty after 1962 one thinks of the many wrongfully convicted Canadians who would almost certainly have been executed but who were instead still alive in prison when their innocence was established. Just a few examples: David Milgaard, Donald Marshall, Thomas Sophonow, Guy Paul Morin and William Mullins-Johnson among many others.

Anyone who supports the death penalty because of a belief in the infallibility in death penalty cases of either the American or Canadian justice systems is naive or uninformed or both.

Before their hanging in 1962 Turpin and Lucas were told they would likely be the last people hanged in Canada, to which Turpin responded "Some consolation".

Just so.




previous columns/blog archive: to access previous columns go to the blog
archive the links to which appear chronologically in the margin beside
each column as it appears on the website -- and use
the links.

to set a 'Google alert' in order to receive automatic notice by email
of new columns as they are posted to, go to


Thursday, July 18, 2013

(No.241) Economical Insurance Co. -- insiders with more nerve than a canal horse

"Economical Insurance Company of Waterloo, Ontario and demutualization:

its insiders have more nerve than a canal horse"                 

by Alastair Rickard

My maternal grandmother, who was too proper to use an epithet to refer to an obnoxious or wrong-headed person, did have a favourite phrase for such people: she would say they "had more nerve than a canal horse".

Her phrase came to me as I read the report (June 25, 2012) by Chuck Howitt in the Waterloo Region Record of the June 24 annual meeting of  the large Canadian mutual property and casualty insurance company Economical Insurance (founded 1871).

It should be noted that Howitt has written most of the (too few) useful newspaper articles about the proposed demutualization of the company (announced in Dec. 2010) and the fundamentally important issues related to it. In the national media most of Canada's financial services paparazzi have been too busy risking hernias carrying water for the Bay and Wall Street crowds to comment on or even take public note of this proposed demutualization.

Yet this move, if permitted by Ottawa, would -- if carried out as the company's board and management propose -- amount to the financial exclusion of hundreds of thousands of Economical's policyholders in favour of a group of 943 company insiders (i.e., "voting policyholders") who now seek to benefit richly from the accumulation of policyholder equity since 1871 and by the fact that policies carrying 'ownership' status were restricted to very limited numbers by keeping such special status policies a de facto secret for decades from most clients and company brokers alike.

Because of the paucity of attention to this matter in the financial media, including the role that must be played by the federal Dept. of Finance and its minister in coming up with a regime to govern such a P & C company demualization (this is the first), I have devoted a number of columns on to the proposed demutualization of Economical Insurance and the creation by Ottawa of a regulatory regime to govern such moves by any Canadian mutual P & C insurance company [see, via the links beside all columns, the columns numbered 159, 166, 179, 206, 208, 209 & 213]

The best detailed analysis anywhere of the key issues raised by the proposed demutualization of Economical Insurance, issues that should be addressed by the federal government, was prepared and submitted to the Finance Department by Claude Gingras, a former life insurance company general counsel as well as a former advisor on life insurance company demutualization to Finance. Gingras is Canada's leading expert on the subject.

The Minister of Finance had invited the public and interested stakeholders to make submissions on the subject of P & C demutualization. However Finance Dept. gatekeepers refused to post on the Finance website  Mr.Gingras'  comments. In certain areas his views were apparently too well informed for certain people in Finance. He refused to allow Finance to post an expurgated version of his submission. His submission was published in its entirety on (No.209).

My own submission on the issue to Finance ( it was essentially one of my previous columns on the subject) was posted by Finance but with certain passages removed. I subsequently republished my submission with the deleted passages marked.

Minister of Finance Jim Flaherty, who occupied the same role for some years in the Ontario provincial government, still has not brought forward for comment a proposed regime for demutualization.

As Howitt wrote in his June 24 Record report of the Economical Insurance annual meeting a number of the 943 voting policyholders of Economical who want to divvy up the "mutual policyholders' equity" among themselves ($1.46 billion at the end of 2012) are getting antsy. They think the wait -- for what they apparently believe will be a windfall of $1+million each -- has gone on too long; the company should hire a lawyer and sue; or bring Flaherty to their meeting; do something. They really want 'their' money.

This corporal's guard of Economical policyholders appear to be dwelling in some sort of  cloud-cuckoo-land. They actually seem to believe that Minister Flaherty will come down from the mountain carrying a tablet on which will be inscribed a demutualization approach that will enrich them -- and only them -- while ignoring the absence of a legitimate basis for doing so while at the same time dismissing the financial interests of the company's many thousands of policyholders.

And how do the members of Economcal Insurance's board of directors and senior management explain and seek to justify what they propose to do in the service of such narrow financial interests? I quote from the company's annual report for 2012 (my comments are in italics):

-- "We see demutualization as the key strategy to sustain the future success and growth of Economical ... we have made progress [with Finance] in furthering the interests of our mutual policyholders [i.e, the interests of the holders of 943 out of Economical's 1.1 million policies] and combating the many arguments by others against demutualization as we have proposed."

-- "We are demutualizing because it is the right thing to do [for whom other than the 943?] ... We will either grow or risk becoming marginalized" [nonsense; for Economical to become a stock company virtually guarantees its subsequent takeover, likely by foreign ownership, of this already large company and its post-takeover disappearance, q.v. the demutualized and then soon disappeared Mutual Life of Canada, founded 1870 also in Waterloo, Ontario]

-- "Demutualization will allow us to make the strategic acquisitions at a scale necessary to place Economical among the five largest property and casualty insurance companies in Canada [it's already in the top 10 and has over the years acquired a stable of p&c companies as subsidiaries]. Demutualization will deliver greater strength and stability for our industry and that's good for all of us."

[Economical, with assets of almost $5 billion and double the regulatory capital requirement, has ample resources as a mutual company -- including $1.4 billion retained earnings -- to use to acquire whatever it actually needs to grow at an even faster pace in Canada. Such cant from the company reminds me of one of several empty rationales used to try to justify the demutualization and inevitable subsequent disappearance of the Mutual Life of Canada which had, as a mutual and not long before its unnecessary demutualization, purchased the Canadian operations of both Prudential of England and Metropolitan Life].

Such lame attempts at explanation offered by Economical's insider group to justify their gormless attempt to divide the company's "mutual policyholders' equity" among themselves are entirely unconvncing. Their arguments are not merely pretentious crap, they are transparently so.

In fact there is a singularly conventional motive available to explain this particular proposal to demutualize generated by the small insider group:  plain, old-fashioned greed.

Consistent with this reality is the apparent celebration of 2012's 12.6% increase in "mutual policyholders' equity" by the May 2013 announcement of the termination of 143 company staff. Perhaps we are to understand that company expenses must be reduced in order to allow for increased but vitally important costs like much higher CEO compensation ($1.5 million in 2011 increased to $2.6 million in 2012).

The proposal from Economical is risible. The desire to divide $1.46 billion of "mutual policyholders' equity" among 943 "voting policyholders"  to the exclusion of others would (if accepted by Ottawa) preclude any dilution of their narrow financial self-aggrandizement by evcn the tossing of some crumbs to the holders of the company's 1.1 million policies who are outside the tight little group. Be assured that, among other clangers, Ottawa has taken note of that one.

Of course one does not need to have the forecasting skills of the 'Amazing Kreskin' to predict that if they were to somehow obtain Ottawa's permission for such a massive financial grab it would be followed by a shit storm politically for Minister Flaherty and the government and legally by what would almost certainly be the launching of a class action on behalf of all or many of Economical's 'non-voting' policyholders. Indeed, depending upon how much of the company's treasury Ottawa allows the Economical insiders to divvy among themselves, there could well be a suit(s) anyway.

Economical Insurance's 2012 annual report is distinctly perverse in its highly selective references to the demutualization so eagerly sought by the company insiders. It is as if the company's board and senior management wished the report's readers to think not in terms of realistic outcomes but rather of what the shit was doing just before it hit the fan.

Those who control and direct Economical Insurance will not get from Ottawa the sort of demutualization formula for which they so eagerly petitioned  if only because Minister Flaherty is far too wary to make such a misstep. He has been in the game of politics too long to fall into the trap of allowing his department to produce, even for public comment, the outline of what would be bound to be widely viewed as a seriously defective regulatory regime but one that would become the vade-mecum for senior executives in terms of federal P & C demutualizations.

Nor will Flaherty, I predict, fall for the cack-handed attempt by some associated with Economical Insurance to grab all or even most of the demutualization pie for themselves.

At its June 2013 annual meeting, 2 1/2 years after the announcement  of the company's proposed  demutualization, it was reported that the chair of the board's committee on demutualization declared that "we are convinced [the regulations on demutualization] are coming."

Perhaps but be careful what you wish for ....




previous columns/blog archive: to access previous columns go to the blog
archive the links to which appear chonologically in the margin beside
each column as it appears on the website -- and use the links.

to set a 'Google alert' in order to receive automatic notice by email
of new columns as they are posted to, go to



Monday, July 8, 2013

(No.240) Americans and guns: a dark wonderland

"Americans and guns: by the numbers a dark wonderland"

by Alastair Rickard

Many Canadians look with incredulity at certain aspects of our American neighbour's society. Gun crime and gun ownership are at or near the top of such a list.

I wonder, for example, why more attention is not paid to the impact on American society of political pandering to inflated fears and civil apprehension about what are actually declining rates of 'crime' but a justice system which incarcerates 2.2 million American adults at one time -- the majority for non-violent crimes.

On the other hand the political failure by U.S. state and federal governments to address in any real way the nexus between prolific gun ownership and crime at a time when at least 5% [sic] of the male population is locked up, on probation or on parole.

It may well be some sort of future reference point in tracking the decline of the dissemination of serious news when CNN (the U.S. broadcast as distinct from its 'international' programming)  under the new direction of the former head of NBC, devotes almost all of its daytime and evening weekday programming hours to the trial of a Florida man (George Zimmerman) who shot and killed another Floridian with a handgun he possessed legally. He was permitted to do so, his defence argues, under Florida's "stand your ground" law.

But consider the context and relevant perspective for this and thousands of other gun homicides each year publicly that are ignored by most of American society's politicians and media:

-- since 1960 more than 1.3 million Americans have died from firearms (homicides, suicides,
accidents). By comparison consider that American combat deaths so far in Iraq and Afghanistan total a few more than 5,280; even the total of American combat deaths in WWI & WWII, Vietnam, and Korea of 431,000 is dwarfed by the country's civilian gun deaths in little more than 50 years.

-- the U.S. firearms homicide rate is 20 times higher than the combined rate of the next 22 high-income developed countries

-- between 2000 and 2008 there were more than 30,000 gun deaths a year in the U.S., an average of more than 80 every day

-- in 2011 the increasing annual number of gun deaths (31,940) almost matched the declining total of U.S. traffic fatalities (32,367)

-- in 2010 alone hospital emergency rooms treated more than 73,000 people for nonfatal gun injuries

-- every year in the U.S. twice as many people are killed by guns than die of terrorist attacks worldwide 

-- an American has a 1 in 3.5 million chance of being killed in a terrorist attack but a 1 in 22,000 chance of being murdered

-- in 2008 the U.S. Supreme Court announced that the American constitution precluded bans on handguns and ordinary rifles.

-- a recent public opinion poll indicated that only 26% of Americans favour banning handguns

-- applications in the various states for permits to carry concealed guns are increasing steadily; a conservative estimate for 2012 indicated 8 million Americans with concealed-carry permits. 

-- in 2002 7 U.S. states still banned concealed-carry guns; by the end of 2012 all 50 states will allow them

-- even after more than a decade after the '9/11' terrorist attacks in the U.S. and the resulting intensified airport security passenger screening, in the first 6 months of 2013 security screeners at U.S. airports found 894 guns either on passengers or in their carry-on bags, a 30% increase over the same period in 2012.

-- in the wake of the Sandy Hook Elementary School mass shooting earlier this year opinion polls indicated that 85% of Americans and 81% of gun owners favoured at least the most modest of President Obama's modest proposed 'gun control' measures: i.e., universal background checks on those who sought to buy guns (at least 40% of guns are purchased at gun shows etc without any checks). Even this provision fell 6 votes short of the 60 needed to overcome a U.S. Senate filibuster.

-- in 2009 the Congressional Research Service estimated there were 310 million firearms in the U.S. (excluding weapons owned by the military); in the same year the American population was 305.5 million

-- these numbers and others suggest that as a practical matter it is virtually impossible to imagine any political passage of meaningful gun control measures on a national basis (much less a ban on handguns).

The human face of the toll on American lives and society wrought by guns can be followed daily on a blog set up by New York Times columnist Joe Nocera, "The Gun Report" ( see 

Reading it is as depressing as contemplating the role and toll that guns take on Americans and their society day after day after day. 




previous columns/blog archive: to access previous columns go to the blog
archive the links to which appear chronologically in the margin beside
each column as it appears on the website -- and use
the links

to set a 'Google alert' in order to receive automatic notice by email
of new columns as they are posted to, go to