Threads

For some of us there is nothing like a little heart problem to add spice to life. Note, it is important that the problem be little. If it is too big, it is all consuming. That's not good. The goal is NOT to be worried about dying but to feel driven to live, to savour the linked moments we call life.

If you have followed my blog, you will know that my granddaughter, an anglaise, is enrolled in a French public school. This is not a French immersion school, a school for English children whose parents want them to speak French. This is a French school for French children.

My granddaughter seems to be getting by. The school has had no complaints about her work. I believe the school is being very supportive of her efforts. Still, I worry. I feel driven to learn a little French, to chat with my granddaughter in the language she uses at school. I want the French fabric that is her school life to be frayed a little and for threads of French to find their way into her homelife, too.

To this end I have been watching French television (mostly TV5) and reading French news stories. A new world has enveloped me. The fabric of French culture is a rich weave with lots of threads loose along its edges.

Which bring me to Joe le Taxi — a song that is among the top one hundred best-selling singles of all time in France. It is also claimed to have been number one in Canada. Are you surprised? I am. Clearly, it was a big hit in Quebec. And clearly I have not been aware of the French threads that reach into Canada but get cleanly cut at the Quebec border.

Joe le Taxi is about a black taxi driver in Paris who knows the City of Lights very well. If it's a great little bar you seek, Joe's your man. A rum drinking, saxaphone playing dude, Joe is cool on the outside with a hot passion for Latin music on the inside.

How did I find the thread that led to the discovery of this song? TV5 and a story about Vanessa Paradis. This French singer-model-actress had a fourteen year relationship with American actor Johnny Depp. This connection makes her fodder for a news machine pumping out stories for an anglais audience.

Paradis was only fourteen when she recorded Joe. Today, in her forties, she has a fourteen year old daughter of her own, Lily-Rose, who is now evolving into an artist. Her daughter already shares a writing credit with mom and another woman, a close family friend. Lily-Rose co-wrote Love Songs with them after coming up with the melody eight years earlier when she was only six.

Paradis is attempting to foster creativity in her children, she also has young son. Paradis is surrounding the two with creative people who will lead by inspired example. Paradis is filling her children's lives with threads — creative threads.

Life is made up of threads, billions of threads. We all follow threads. It is the way life works. These threads, an uncountable number, are interwoven into the fabric we call culture. I'm hoping this learning of French will encourage my granddaughter to follow threads which lead deep into the cultural tangle that is Canada than I have ever gone. I hope taking French will be inspirational for my developing granddaughter.

Too many Americans and Canadians wear large, thick cultural blinders. Many Yanks cannot get past the "greatest country in the world" hollow boast. Talk of anything outside the United States makes their eyes glaze over. I do not want my granddaughter to be trapped in a cultural straight jacket.

If a young Vanessa Paradis, barely a teen, singing a charming, little piece of pop music seems a fragile thread on which to anchor an interest in French culture, you'd be right. It is very fine thread. And yet, if you follow it, if you allow it to gently pique your interest, you will find your self travelling deeper and deeper into French pop culture.

You may find yourself immersed in French techno pop music experiencing songs like Vive la fete, Bananasplit, or Laurent Garnier, Flashback. I have followed those threads in the past thanks to a woman who was not a small thread but a large swath of wonderfully patterned cloth in my life: My mother.

In her eighties, cruising from channel to channel one evening, searching for something of interest on television, my mother chanced upon an open-air concert by Jean Michel Jarre recorded in Paris. She loved the concert, the music and the light show accompanying it. We followed the JMJ thread and found it led us to Charlotte Rampling, an English actress and his second wife. This new thread connected us with The Night Porter, a difficult movie from the '70s with Dirk Bogarde. Bogarde was one of my mother's favourite actors. The movie was not.

Threads: Life is composed of threads. The threads we follow lead us deep into the fabric we call life. Threads hold never ending interest. We pass threads from the old to the young, from the young to the old, and from the dying to the newborn. Look about, find a thread, follow it. Live!

Ablation for heart flutter in the U.S. and Canada

Health care is expensive. That is a given. How a society covers the cost of health care is the big question facing both Canada and the United States. The Americans, prior to Obama, essentially relied on insurance companies to solve the problem. The solution wasn't perfect but for many Americans it worked.

Unfortunately, if you were dropped by your insurance company and you were unable to replace your coverage, you were in deep trouble. If you had a preexisting condition, the very health issue for which you needed covered, you might not be able to get that coverage. And if you could not afford the insurance premiums, you went without. The result was that in the States something between 35 and 40 percent of all Americans took a pass on health care; They didn't go to the doctor, to the dentist, or the hospital and if they did go they didn't get their prescriptions filled afterwards.

Canada has taken a different tack. It is called the single payer system, I believe. It isn't socialized medicine but Yanks see it that way. Because so many more Canadians as a proportion of society have health care coverage, the demand for health care in Canada is swamping the health care system. The U.S. system isn't swamped but then almost 40 percent of Americans are being kept on the sidelines. Comparing the Canadian system to the American one is a complex problem. The results of an indepth examination of the two systems really depends upon how you approach the issue.

My take on Canadian health care is from the angle of an aging heart patient. Treating my heart disease is time consuming and expensive. Suffering from a genetic-based heart disease (ARVC), my heart muscle is being slowly converted into fibrous tissue and fat. Neither materials are found to any great extent in strong, healthy heart tissue. As the muscle breaksdown, the weakened heart expands and fails.

I have given up jogging. Asking the heart to pump a lot of blood in a short period of time stresses the heart. It expands with resulting small tears. The small tears heal with fibrous tissue and fat filling the space.

Keeping my heart rate down and keeping a lid on my blood pressure are both important. I'm losing weight to easy the burden on my heart. I'm down to 195 pounds. I take a powerful drug to depress my heart rate. I take Lipitor to keep my cholesterol in check. And I take a blood thinner, Pradaxa, to prevent blood clots forming in my poorly functioning heart.

With my condition, heart arrhythmias are common. I suffer from a heart arrhythmia known as flutter. Arrhythmias cause the blood to swirl and stagnate in the heart. In about five percent of the time, this swirling results in the formation of blood clots which then move to the brain causing a serious stroke. Blood thinner slashes the chance of this occurring.

Sometimes, my heart can runaway. When this happens my heart must be hit with a brief but intense electric shock. In California a defibrillator was used in the Sonoma Hospital emergency room to force my heart back into sinus rhythm. If my heart is not returned to sinus rhythm within about ten minutes I can suffer irreparable brain damage and, within a few more minutes, death.

To prevent this, the doctors in Canada installed an ICD in my chest. ICD stands for
implantable cardioverter defibrillator. My personal defibrillator has stopped my heart from racing and has returned it to sinus rhythm at least three times. The ICD has also acted early to correct potential runaway heart problems, stopping the events from continuing into the life threatening stage.

Oddly enough, when my heart isn't racing, it is hardly beating at all. My heart rate can drop into the thirties! This isn't good. My ICD is programed to notice this problem and at these times it acts like a pacemaker. In one three month period it was found that my ICD paced my heart 98 percent of the time.

Last Friday, a week ago, the cardiac specialists at the London Health Sciences Centre gave me a reprieve from my constant heart flutter. They performed a catheter ablation procedure on my heart. Opening a small hole in a major vein in my groin, the cardiac team threaded fine wires through the vein up into my heart. They found the bad electrical pathway in the heart and burned a path across it. Scar tissue will form and this barrier should prevent my heart from returning to flutter for sometime. Eventually the heart may find another route or another path may form as my heart continues to expand. A second procedure may be necessary.

Today, I feel much better. My heart is out of flutter. My chest feels, for the most part, relaxed. But, more to the point, I am relaxed. Living in Canada, I had to be patient as the doctors went about the task of extending my life but, in the end, I was not saddled with an impossible to pay bill. Nor did I face the possibility of being dropped by my insurance company or seeing my premiums climb into the stratosphere.

What a contrast to the situation resulting from my medical treatment received in California. There the doctors were also excellent, the hospital first rate, the equipment state of the art but the bill was unbelievable. And I do mean unbelievable. When I told my Canadian doctors that I was able to run up a bill closing in on $30,000 in less than 48 hours, they were totally amazed.

After dumping almost $30,000 in California and finding no reason for my V-tach event, my health insurer was exceedingly unhappy. I believe, if I were American, I would have been at risk of having my insurance coverage revoked. On my own, I could never have afforded the wealth of tests that eventually were needed to discover the genetic cause of my problem. I certainly could not have afforded the ICD that has saved my life a number of times. And I could not have paid for the ablation therapy I had last week.

Health care is a complex issue. The stories in the media are more entertaining than informative. I cannot speak for all areas of health care in Canada. But, I can tell you that in London, Ontario, the cardiac doctors at the LHCS are first-rate, the treatment excellent and the options offered very compete.

The LHSC will be mentioned in my will and today I make do by making annual donations to both the hospital and to the Robarts Research Institute which is connected to both the hospital and to the nearby university.

My little artist has discovered depth

It is a small step for a budding artist of four but it is still a major milestone. My granddaughter has discovered depth. Or should I say stumbled upon depth? She clearly liked the effect of the yellow heart sitting on top of the red shape. In fact, she liked the result so much that she overlapped a couple more shapes, creating a little row descending down the page.

I wonder if it is time to teach her about perspective lines?

I know she didn't intend it but I rather like the way the hearts morph into an almost butterfly shape by the time she reaches the top right corner of this piece. I say almost as my wife sees a dove as the final shape morphing out of a grouping of butterflies.

Whatever . . . in the end I like to leave abstract art abstract.

Wow!

In retirement, architecture has attracted a lot of my attention. At some point I was placed on the e-mail list of a firm specializing in soil stabilization. The firm sends me links to interesting sites, from an architectural standpoint, and ones that posed unique soil stabilization problems. The firm sent me pictures of the Sheraton “Huzhhou Hot Spring Spring” Hotel. Amazing. I went in search of more. Now, I want to share a link with my readers.

Lo Sheraton “Huzhhou Hot Spring Spring” Hotel.

Considering the quality of the place, the cost of a stay seems rather reasonable. I picked a couple of dates in February and found I could book a room for my wife and me for a little more than $400 a night. We won't be going anytime soon but if I'm ever in China and want to pretend that I'm a one percenter . . .

Rebuttal to Sun Media column on company closures and layoffs

Last week Larry Cornies examined the rash of plant closures that have battered the economy of Southwestern Ontario. The London Free Press columnist slipped in one of his core business beliefs when he made the following claim: Companies — whether it’s Libby’s, Ford, Heinz, Kellogg or U.S. Steel — all act in the strategic interests of their shareholders or investors — It's their imperative, he tells us.

Mr. Cornies may be wrong, as any long-time investor in the stock market knows all too well. My guess is Mr. Cornies is well aware his position here is questionable. That is why he tries to slip his claim quickly by his readers. He makes no mention of the growing number of experts who believe the "shareholder value imperative" is a myth — a common one, an oft repeated one, especially in the media, but a myth just the same.

An entire book has been written addressing this very subject — The Shareholder Value Myth: How Putting Shareholders First Harms Investors, Corporations and the Public by Lynn Stout, a Distinguished Professor of Corporate & Business Law at Cornell University Law School in Itaca, NY.

Ms Stout wrote in an article published by the Utne Reader and posted online:

If we stop to examine the reality of who "the shareholder" really is — not an abstract creature obsessed with the single goal of raising the share price of a single firm today, but real human beings with the capacity to think for the future and to make binding commitments, with a wide range of investments and interests beyond the shares they happen to hold in any single firm, and with consciences that make most of them concerned, at least a bit, about the fates of others, future generations, and the planet — it soon becomes apparent that conventional shareholder primacy harms not only stakeholders and the public, but most shareholders as well.

Ms Stout points out that between 1997 and 2008, the number of companies listed on U.S. exchanges declined from 8,823 to only 5,401. The Heinz Co. has now joined the growing list of public companies taken private. This a disaster for investors in the market. Retiree shareholders, like me, are especially hard hit. The cream of the investment world is being siphoned away.

Heinz was a cash cow for its shareholders. Those who bought shares in early January 2010 saw a gain of almost 39 percent in three years, and that is just share value growth. Heinz also paid an annual dividend of $2.06 at the time it was taken private .

Admittedly, Heinz shareholders saw an immediate pop in the value of their shares with the purchase of the food giant by Berkshire Hathaway and 3G Capital but it was a one time event. To a great extent, Heinz is now a private cash cow.

Nebraska-based Berkshire Hathaway holds $8 billion in preferred shares paying a 9 percent dividend, or $720 million a year. Compare this payout to the old common-stock dividend. It only cost the Heinz Co. about $665 million.

Larry Cornies assures us that a multinational like Heinz is forced to make some hard decisions. True but Heinz was not facing any immediate hard decisions. The company was awash in $325 million free cash flow.

The hard decisions materialized when Heinz became a private multinational saddled with a lot of new and growing expenses. Heinz faced some 2000 hard decisions. That's the number of jobs cut since the company was taken private.

One big driver of the recent closures, and left unmentioned by Mr. Cornies, is greed — and greed is not good despite what Kevin O'Leary, of Dragons' Den fame, proclaims oh-so-loudly. To understand the damage caused by unbridled greed one needs to look no farther than Mr. O'leary himself.

In his memoir, Cold Hard Truth, O'Leary called The Learning Company, his patched-together business, a money-making machine. The Tuck School of Business at Dartmouth University begs to differ. According to the business school TLC had "questionable profitability" and "two of Learning Co.’s deals . . . rank among the 10 worst U.S. acquisitions during 1994-1996 as measured by shareholder value two years after the deal." According to The Globe and Mail, an SEC filing shows that TLC suffered net losses of $376 million in 1996, $495 million in 1997 and $105 million in 1998.

Erik Gustafson, manager of the Stein Roe Growth Stock Fund, a major shareholder in Mattel at the time of the TLC acquisition, is widely quoted as saying, "The present management team [at Mattel] has vaporized two thirds of the value of the company." While shareholder value was tanking, long-time Mattel workers were also suffering. 3000 lost their jobs.

So, who benefited from the Mattel financial meltdown? Kevin O'Leary for one. Bain Capital for another. When Mattel handed O'Leary his walking papers, after just months with the company, his TLC division was killing the company. O'Leary's pain of being, what some have called, fired was eased by a $5.2 million golden parachute.

Landing on his feet, O'Leary appears regularly on CBC as their business go-to-man. The Ivey Business School at Western University thinks so highly of his philosophy of greed that they have placed him on their advisory board. Does this tell you something is wrong in our accepted business model?

One can learn more about why the Southwestern Ontario region is experiencing so many mergers and subsequent closures from reading the news reports of Norm DeBono in The London Free Press and staying clear of the opinion pieces by journalism professor Larry Cornies.

According to DeBono:

A U.S. investment firm has bought and closed three London businesses in four years, shortchanging workers on severance in at least two of those businesses — and might do it again. Apparently, there are no federal or provincial restrictions in Canada that a company has to respect the law in how it treats its former workers before it can buy another business in the country. . . .

"There are laws that protect employees when there is successor-ship (another company taking over). But if a company is winding down a business, their obligations to fund may disappear," said Tim Gleason, a Toronto labour lawyer.

• Sun Capital Partners in Boca Raton Fla in 2007 bought McCormicks in London, laying off 275 workers, refusing them severance and vacation pay and their pensions. Workers won vacation pay after a two-year legal fight.

• In 2008 H.J. Jones Packaging in London was sold to Knight Packaging of Chicago, a Sun Capital firm. H.J. Jones was closed, cutting 45 jobs. Workers were also refused severance, but finally won a deal that gave them half of what they were owed.

• In 2011 the year-end closure of Specialized Packaging Group in London was announced, cutting 189 jobs. It's owned by PaperWorks of Philadelphia, another Sun Capital company.

It is one thing to watch American interests close their long-time Canadian branch plants but it is quite another when an American company buys a successful Canadian business, folds it into the U.S. firm, and then closes the Canadian operation — often moving the production Stateside.

For an example of this think of Bick's. This Canadian company made pickles in Dunnville, Ontario, until the giant American company J.M. Smucker bought the operation, closed it, and moved production to Ohio.

Deals from Hell

London, Ontario, has been hard hit by company closures, as has all of Southwestern, Ontario. With thousands of Canadians losing their jobs, Sun Media columnist Larry Cornies has come out in print as an apologist for the companies. The companies are only acting in the strategic interests of their investors, he tells his readers. Corporations must seek to maximize value for shareholders, he claims.

The problem with Cornies' argument is that the executives running companies do not always put the shareholders' interests first. They might but then they might not. In many cases, the executives are looking out for Number One, themselves.

Mennonite Mutual Aid

Mennonite Mutual Aid

The title of this post was inspired by a book of the same name by Robert F. Bruner, professor of business administration at the Darden School of Business at the University of Virginia. An article in The New York Times examining business mergers and whether or not they make good financial sense reported:

"Bruner is critical of this process [business mergers], which he calls financial cosmetics. 'It invites the creation of growth for appearance rather than growth that creates wealth for investors and society,' he says."

Another good name for this post would have been Pay Without Performance after the book by Harvard professor Lucien Bebchuk with Jesse Fried. Why? Because so many of the recent closures did not benefit shareholders to anywhere near the extent that the closures benefited the deal makers

Consider Heinz. If your grandparents had bought just 100 shares for $2500 when the company went public in 1946, you would have owned, after stock splits, 16,200 shares, which would have been worth almost $1 million at the time Berkshire Hathaway and 3G made their offer. Those shares were yielding $33,372 annually in dividends. (Admittedly, Heinz shares did enjoy a $12 pop thanks to the buyout.)

Over the years, Heinz, the-public-company, was a cash cow for its shareholders. Now Heinz, the-private-company, will be a cash cow for Berkshire Hathaway Inc. and 3G Capital. It will not be a continuing cash cow for its buy-and-hold shareholders.

To argue that Heinz, an American company, would not have closed its large, Canadian plant is impossible. I have no crystal ball. But I can tell you this: Bloomberg Personal Finance reports that annual interest expense at Heinz probably doubled to $560 million since the takeover. Plus, Nebraska-based Berkshire Hathaway now holds $8 billion in preferred shares paying a 9 percent dividend, or $720 million a year.

If $720 million sounds like a lot, it is. Going private may have eliminated the common-stock dividend but that dividend only cost Heinz about $665 million.

Larry Cornies tells us: "For a multinational like Heinz, the comparative costs of labour, raw materials, power, land, machinery and other inputs in some other part of the world forced hard decisions here."

He's right. But what Cornies doesn't mention is that Heinz posted $2.01 billion in ebitda last year on $11.5 billion in revenue. Ebitda stands for earnings before interest, taxes, depreciation, and amortization. After deducting those expenses, the company was awash in $325 million free cash flow. Heinz wasn't facing any immediate hard decisions.

The hard decisions materialized when Heinz became a private multinational saddled with a lot of expenses associated with going private. Heinz faced something in the neighbourhood of 2000 hard decisions. That's the number of jobs Heinz has cut since being taken private.

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One last thought. One that I couldn't fit into the post above. All shareholders are not as shallow as Cornies apparently believes or as amoral. Cornies is a Mennonite and proud to be a Mennonite. Yet, I believe, there are Mennonites who would take a different tack that he does in his Free Press piece.

The following is from Crossroads, Eastern Mennonite University:

"No business that wants to last can afford to ignore in its financial statements the depletion of its productive assets, yet that is precisely what the global economy is doing. . . . Disaster looms precisely because the current economic model has no built-in limits – no stopping point short of a crisis generated by environmental or social collapse."

– James M. Harder and Karen Klassen Harder, Bluffton University

I'd like to see Cornies tackle the closure of so many Canadian plants, many successful. These Canadian businesses were bought by American interests, sometimes private equity firms, the work moved to the States and the Canadian operations closed.

Possibly Cornies should read David Steward's Doing Business by the Good Book. Steward writes: "The investment community can apply tremendous pressure to produce quarterly profits. This outside persuasion sometimes tempts management to think short-term, reduce expenditures, and forgo quality. . . . the demand put on management for three-month gains isn’t necessarily good for a company’s [or its shareholders] long-term interests.”

Civilizations don't die, they commit suicide

London, Ontario, the city I call home, has problems. These problems are common and challenge cities everywhere. London the town grew into London the city but it did so without a vision, without a plan. Like so many places, London sprawls out over the precious farmland of Southwestern Ontario, like ink leaking from a faulty pen destroying the shirt. Most cities on the planet leak people.

Sprawl has been going on for as long as there have been cities. It is not a new problem. It is the scale and global nature of today's sprawl that is new. As I write this my memory flashes back to the early '70s and my days at university in Toronto and I recall a book that I had to read for one of my classes: The Limits to Growth, a report on a Club of Rome project.

Selling more than 30 million copies, that book had a big effect on a lot of people, young and idealistic at that time four decades distant. Unable to find my copy, I found the following linked article online: Revisiting The Limits to Growth: Could The Club of Rome Have Been Correct, After All? (Part One) by Matthew Simmons.

Simmons' article was interesting in that it didn't find fault with The Limits to Growth but instead found fault with many of the criticisms that have flooded the popular press in the intervening decades. Simmons tells us:

Nowhere in the book was there any mention about running out of anything by 2000. . . .

The book postulated a continuation of the exponential growth of the seventies . . . would result in severe constraints on all known global resources by 2050 to 2070.

The task was to examine the complex problems troubling "men of all nations; poverty in the midst of plenty, degradation of the environment, loss of faith in institutions, uncontrolled urban spread, etc."

While many readers concocted various 'imaginary' assumptions, the book's conclusions were quite simple. . . . a limit to the growth that our planet has enjoyed would be reached sometime within the next 100 years.

The Limits to Growth is not the only book with a tone that reflects my gut concerns about the massive loss of  Southwestern Ontario farmland. For a more on-point discussion of the problem (without actually confronting it head-on) read Collapse: How Societies Choose to Fail or Succeed by Malcolm Gladwell and published originally in the New Yorker.

This is a review of the book Collapse: How Societies Choose to Fail or Succeed by Jared Diamond. According to Gladwell, Collapse is a book about the most prosaic elements of the earth’s ecosystem — soil, trees, and water — because societies fail, in Diamond’s view, when they mismanage those environmental factors. . . . The lesson of Collapse is that societies, as often as not, aren’t murdered. They commit suicide . . .