#LiquorLeaks examines Clark's "liquor cabinet"

When Premier Christy Clark shuffled her cabinet on Sept. 5, she also refreshed her "liquor cabinet." 

Several cabinet ministers and MLAs are involved in one of the government’s biggest, most controversial priorities of 2012: to sell the warehousing and distribution operations of the Liquor Distribution Branch to a private operator. 

No business plan has been published by the government to justify the Feb. 21-announced breakup of LDB, which made a $911.1 million profit for government coffers on $2.89 billion of sales last year. 

Much has been written about Exel Logistics, which operates Alberta’s private since 1994 system and hired high-powered BC Liberal insiders Patrick Kinsella and Mark Jiles to lobby for the B.C. gig since 2005. No other company that submitted bids by the June 29 deadline has been as aggressive as Exel, which originally wanted to do a private-public partnership and skip a public tendering process altogether.

Clark is head of cabinet and, what I call, the liquor cabinet. Kinsella was co-chairman of her successful 2011 leadership campaign, a guest at her swearing-in on March 14, 2011 and a guest at the B.C. Place Suite for the Sept. 30, 2011 reopening of B.C. Place Stadium. Kinsella ended his lobbying registration for Exel on March 30, a month before the request for proposals was published.

Rich Coleman (upper right) is the minister responsible for the Liquor Distribution Branch and Liquor Control and Licensing Branch. His business card became more crowded in the shuffle with the designation of Deputy Premier. Coleman's name is mentioned in the Exel "Project Last Spike" internal memo: company vice-president Scott Lyons told his superiors that the company's relationship with Coleman could be used to influence the writing of the RFP. 

Mike de Jong (middle right) replaced the resigned Kevin Falcon as Finance Minister and was given the responsibility to “lead the work on the possible asset sale,” according to a Finance Ministry representative on condition of anonymity. De Jong was the waffling Attorney-General when Dave Basi and Bob Virk made surprise guilty pleas on Oct. 18, 2010 after the ex-Liberal ministerial aides accepted $6 million of taxpayers' money to pay their legal bills. A still-secret transaction that the Auditor-General John Doyle and intervenor/ex-Liberal MLA John van Dongen are seeking a court order to bring to daylight. (Hear more about the controversial sale of BC Rail to CN in The Investigators documentary here.)

Ben Stewart (lower right) replaced Margaret MacDiarmid as the Citizens’ Services Minister. Stewart is responsible for government-wide buying and contracting and it is the staff of his ministry who are handling the LDB tendering process. Three executives of the Coleman-overseen LDB (including acting general manager Roger Bissoondatt) and four executives from the Stewart-overseen Citizens' Services are on the evaluation committee, weighing the bids from four companies (Exel, ContainerWorld, Kuehne + Nagel and Metro Supply Chain Group).

“They will continue in their current roles in the procurement process,” said the Finance Ministry representative.

”Given Minister's Stewart's previous involvement in the industry, out of an abundance of caution and to ensure no perception of conflict, responsibility for this project was transferred to the Minister of Finance.”

Let’s not pussyfoot around the issue, eh? Stewart is both a client of B.C.’s LDB and Exel’s Alberta monopoly, Connect Logistics, through his family company Quails’ Gate Estate Winery of Kelowna. He was also lobbied by Lyons. Stewart advocates private distribution and said in the Legislature on May 7, the day before my story exposing Exel’s "Project Last Spike" broke and NDP critic Shane Simpson stood up in the Legislature during Question Period to demand answers from Coleman. 

Coincidentally, I spoke with Stewart on Sept. 4, the night before he was sworn into cabinet. (Stewart gave no hint about his imminent job promotion). Here's what he said about Exel's push to privatize: 

“We probably only have a very very tiny piece of the utilization of that, we've been working with LDB successfully almost 25 years and this new model is probably comparable a little bit to the Alberta model... 
“Sometimes it takes the initiative of some catalyst to make sometimes these things to happen. I think that Exel may have asked the question. Is the province willing to consider it. They knew that there was other competitors. There's people that house and store wine for imported wines and other products here int he province. The LDB doesn't have the capacity or the interest to be becoming a warehousing depot is what I think Exel is probably more their field of expertise.
“My only point of contact is I knew the distribution systems around the country and other parts of the world because of my background. That's the only reason I probably talked to Scott at any point and was supportive of the concept that if they thought they could do it better, we should look at an open process.” 

Stewart told me he had spoken with Lyons over a year ago. Lyons, we found out in July, had also spoken with Stewart’s brother, Tony Stewart. 

“I think Scott mentioned that he had met with my brother, my brother is responsible as CEO of our company to essentially maintain and do what's necessary to run our business.
“When I chose to go into politics I completely moved everything into a blind trust and have a friend that actually is the trustee, I have no contact at all with the winery. I don't know what my brother is doing in terms of whatever discussions. On a personal note we see each other for Christmas and family events, but it's not about the business. I have the trust in the trustee and him and the board of directors I put in place beforehand to make certain these things were done in a proper manner before I considered giving up a business that I'd spent 35 years creating.” 

Meanwhile, De Jong chairs Treasury Board, the 10-member committee that will approve the winning bidder in mid-October. Coleman and Stewart are also on Treasury Board. Same goes for Jobs and Tourism Minister Pat Bell, Ex-Finance Minister (and co-father of the Harmonized Sales Tax) Colin Hansen and John Les, who was liquor minister in 2005. Exel lobbyist Mark Jiles held several meetings with Les from 2005 to 2007, at which Les apparently expressed his encouragement. De Jong's vice-chair on Treasury Board is Justice Minister Shirley Bond, who was lobbied on Aug. 25, 2011 by Lyons in a meeting at the Premier's Vancouver Office and signed reports to Treasury Board and Cabinet supporting the Exel proposal to privatize LDB's logistics. Earlier that summer, Lyons had lobbied another Treasury Board member, Ida Chong, who helped connect Lyons with Tony Stewart. 

Political football as Liberals kick-off campaign

The Vancouver Whitecaps finally have their long-sought training nest.

.

The provincial government kicked in $14.5 million to the $32.5 million National Soccer Development Centre at the University of B.C.'s Thunderbird Park for a trio of natural grass pitches, a pair of synthetic turf fields and a field house. Another $3 million is on the table for future replacement of the artificial turf. It's near the Doug Mitchell Thunderbird Sports Centre, the white elephant of the 2010 Winter Olympics where few spectator events happen. The B.C. government paid about $19 million of the $47.8 million bill for the Games' secondary hockey venue. 

The soccer complex was originally earmarked for Delta and announced amid the last provincial election campaign on May 2, 2009 -- 10 days before the BC Liberals won another term. Premier Gordon Campbell had announced $17.5 million from the province towards a $31.5 million complex on 20-hectare John Oliver Park. 

But the attempt to buy the soccer vote near tony Tsawwassen got the yellow card from voters and municipal authorities. Liberal parachute candidate Wally Oppal lost on a recount to independent Vicki Huntingdon. By February 2010, Delta municipal council grew frustrated with the Whitecaps and nixed the project. 

Municipal land in Surrey and Burnaby was also eyed and the Whitecaps didn't endear themselves to those city halls. Enter UBC, which isn't a municipality (read: less bureaucracy) and happens to be in the Vancouver-Point Grey riding represented by Premier Christy Clark. Whitecaps' secretive and wealthy principal owner Greg Kerfoot is a personal friend of the premier. In seven donations since 2005, Kerfoot has given the BC Liberal party $36,790 via the Whitecaps and his company, Inspirit Group. 

Tech tycoon Kerfoot, a 1983 UBC computer science graduate, could afford to pay the whole bill himself for the training centre. Through a real estate agent, he was flogging this West Vancouver waterfront mansion on Stearman Beach for almost $10 million and seeking Vancouver city hall approval to build an office tower in downtown Vancouver at the southeast corner of Cordova and Granville. Back in 2005, the Whitecaps proposed using $60 million of Kerfoot's money to build an outdoor stadium north of Gastown. He already bought the land, worth $20 million. City council sent that hot potato to Port Metro Vancouver, where talks stalled for good. The Whitecaps eventually scored a sweetheart rent deal in the renovated B.C. Place Stadium. B.C. Pavilion Corporation refuses to tell me what, if anything, the Whitecaps pay for rent.  

The Sept. 6 announcement happened in Clark's riding, but the Premier was not there! Clark attended the annual Order of British Columbia awards ceremony at Government House in Victoria. Asked where she was in the afternoon, press secretary Mike Morton told me on Sept. 10 "the short answer is meetings." He suggested I make a Freedom of Information request for her agenda if I wanted to know more.  

Ex-sport minster Ida Chong stood-in for newcomer Bill Bennett for the first major spending announcement/re-announcement since Clark shuffled the cabinet a day earlier.  Burnaby MLA Richard Lee, North Vancouver MLA Jane Thornthwaite and Vancouver MLA Colin Hansen (Clark's 2011 by-election campaign chair) joined Whitecaps' president Bob Lenarduzzi for a photo opportunity with the UBC mascot. (Have the Whitecaps' mascot Spike and executive chairman John Furlong suddenly become camera-shy?)

The scheduling could have been a very clever tactic, to keep Premier Photo-Op away from cameras at what was the de facto kickoff of the fall 2012 phase of her 2013 re-election campaign (however futile it may be). 

Make no mistake, the joint government/Whitecaps/UBC news conference was to curry favour with a large portion of voters. Soccer is the biggest participatory team sport in B.C. The B.C. Soccer Association claims 100,000 youth players and 20,000 adult players, plus 2,000 registered referees. That's a lot families and their votes could mean a lot to the desperate-to-stay-in-power governing Liberals next May.

The Vancouver Whitecaps and the B.C. Liberals. Both mired in a slump.

They never got to go home. We must never forget.

An apartment block with ivy stretching across and up a sunbathed wall under a blue sky morning. A water fountain. A lost kitten poster nearby. Bicycles parked. It was a serene atmosphere on the morning of Sept. 24, 2010 in Munich as I strolled along, taking photographs. 

It wasn't like this on Sept. 5-6, 1972 at Connollystrasse 31, in the Munich 1972 Olympic Village.

This is where the world of sport forever changed. This is where Palestinian terrorists, calling their group Black September, took Israeli athletes and coaches hostage. The 11 innocents were eventually killed in what became known as the Munich Massacre.  

Perhaps the biggest tragedy was that the ugly incident was preventable. In fact, a psychologist advising Munich 1972 organizers, Dr. Georg Sieber, submitted a list of 26 potential security scenarios, according to Sports Illustrated's Aug. 26, 2002 edition. One of Sieber's scenarios came true.

The psychologist had submitted to organizers Situation 21, which comprised the following particulars: At 5:00 one morning, a dozen armed Palestinians would scale the perimeter fence of the Village. They would invade the building that housed the Israeli delegation, kill a hostage or two ("To enforce discipline," Sieber says today), then demand the release of prisoners held in Israeli jails and a plane to fly to some Arab capital. Even if the Palestinians failed to liberate their comrades, Sieber predicted, they would "turn the Games into a political demonstration" and would be "prepared to die.... On no account can they be expected to surrender."

Organizers wanted to have "Carefree Games" as they intended to welcome the world back to Germany. They were hoping to put behind them the ugly past of World War II. So Sieber's Scenario 21 was shelved. Denied. Ignored.

With security tossed aside, the Olympics became one big party. Mimes, jugglers, bands and Waldi, the dachshund mascot, gamboled through the Village, while uncredentialed interlopers slipped easily past its gates. After late-night runs to the Hofbräuhaus, why would virile young athletes bother to detour to an official entrance when they could scale a chain-link fence only 6 1/2 feet high? The Olys learned to look the other way. A police inspector supervising security in the Village eventually cut back nighttime patrols because, as he put it, "at night nothing happens."

New information this year reveals that Neo-Nazis aided the terrorists and that German authorities were warned that something was going to happen. It never should have happened.

I was only two-years-old at the time. Since 2006, I have covered two Winter Olympics, two Summer Olympics, a Pan American Games and a Commonwealth Games. I have often criticized the apparent overwhelming spending waste on Olympic security. Security is absolutely necessary, but is absolute security necessary? How much is too much? I always wonder, if the fundamentals are followed, can the same goal of a safe and secure Games still be achieved for half the price? In 1972, German authorities simply didn't take care of Basic Security 101: The terrorists, wearing tracksuits, jumped a fence that was inadequately patrolled, along with bona fide athletes, including Canadians.  

The incident unfolded before the eyes of the world and it came to a horrible conclusion.

ABC's Jim McKay delivered the grim news to viewers, in one of the most dramatic moments in sports broadcasting: "There were 11 hostages," he said. "Two were killed in their rooms, yesterday morning. Nine were killed at the airport, tonight. They're all gone."

Their names are still there. Inscribed on a plaque, in Hebrew and German, above "Ehre Ihrem Andenken" (Honor to their memory): David Berger, Seew Friedman, Josef Gutfreund, Elieser Halfin, Josef Romano, Amizur Shapira, Kehat Shorr, Mark Slavin, Andre Spitzer, Jaakow Springer, Mosche Weinberger. 

They went to Munich to compete in peace. They never got to go home. We must never forget. 

What now, #JesusLeaks? Crikey!

I'm taking a short break... a very short break... from the long-running, hit reality blog series called #LiquorLeaks and the new spinoff called #LotteryLeaks (I hear Deputy Premier Rich Coleman is a big fan -- not!) to bring you #JesusLeaks.

Yes, the B.C. Conservative Party is imploding under the leadership of John Cummins. The party failed to win either seat in last April's Chilliwack and Port Moody by-elections. It has been downhill ever since. Next May, will the Conservatives be a viable option to form the next Official Opposition (or be kingmakers in a minority scenario)? Or will the party simply be a vessel for a protest vote against the crumbling BC Liberals and little else?

Members are complaining that Cummins didn't do enough on the summertime barbeque season and isn't doing enough to support John van Dongen's noble (and costly) legal quest to unearth the truth about the BC Rail scandal and, especially, the $6 million deal that appeared to have induced surprise guilty please from Dave Basi and Bob Virk on Oct. 18, 2010.

Cummins is facing a leadership challenge. Some B.C. Tories want Cummins to be "goins" before October. 

The last straw for his opponents may have been Cummins' infamous quote in the Vancouver Sun comparing his plight to that of Jesus Christ. 

“I hate to use a biblical reference but Christ had 12 apostles and one turned him in,” Cummins said. “We share the same initials but I can’t rise from the dead and I can’t get unanimity on the board. I wouldn’t expect to be able to. He couldn’t. I can’t.”

While we wait for the ex-fisherman to drop a line about multiplying loaves and fishes or ponder his political resurrection, enjoy the latest Conservative internal communication provided to me by a source on Sept. 5:

Hello, BC Conservative Presidents: 

The feedback I’ve been getting from my address to the membership, this past week, has been positive in the fact that I have had a chance to clear up issues relating to party communication and administration that have been weighing heavy this past term. 

It seems as though there are issues affecting our party that many of you had wished the respect of knowing sooner, but were not privy to. 

Please let me clarify, too, that my intent on bringing to light party matters and the encouragement to vote yes in the leadership review, is that this party can ensure a strong success in the next general election. 

Although you may not be aware, it has been made public knowledge, that our party has limited funds and has weekend its ability to raise funds this term. In fact, last month our expenses were twice that of funds raised. With this in mind, in a vote that was not permitted to go to secret ballot at a board meeting, by our party president Reed Elley when asked for; and in contrast to our one MLA putting up his own money to fight the BC Rail case. John Cummins is now taking $4000.00 per month, plus his expenses, of the party’s limited resources, to add to his extremely high personal income, at a time when we need every resource possible to fight the next general election. With this in mind, we must ask ourselves what the motivation of the leadership of this party is when we have not seen, although we have gone through two by-elections, one workshop to train our volunteers in election readiness. When we had seen the growth of this party’s organisation develop, on an average rate at one Constituency Association (CA) every two weeks from 2010-2011, to a stagnant term where CAs have now resigned and dissolved. To the inability to provide in many instances a positive work environment, respect to volunteers, and a proper channel of communication to you our CA presidents and local representatives. 

The fact of the matter is that we will not be relevant in the next election, even in times like these, through a campaign of press releases and limited resources.

I hope this brings more clarification to recent statements.  

If there are other items I can clear up, you can give me a private call. 

Ben Besler

BC Conservative Party 

Vice President

#LiquorLeaks salutes a New Champion (in name only)

Q: What's the easiest way to become a champion when it looks like you're the captain a losing team?

A: Go to an event where it's on the marquee and bring home the T-shirt!

Premier Christy Clark is returning to China, this time for the World Economic Forum's Annual Meeting of the New Champions 2012 in Tianjin, China, to speak on a natural resources panel and host a wine-and-cheese party on Sept. 11.

There are two natural resources-related panels on Sept. 11 (The Future of Energy and The Future of the Resource Industry), but neither the speakers nor the times are listed on the program. The day's climax is a speech by Chinese Premier Wen Jiabao, whose Communist Party governs a country with an atrocious human rights record, where many of the citizens view the one-party, authoritarian state as a bullying force.

WEF in Tianjin is nicknamed "the Summer Davos" in reference to the Swiss town where the World Economic Forum meets every January. In 1992, NDP Premier Mike Harcourt and Finance Minister Glen Clark (the future premier who is unrelated to the current one), attended WEF in Davos. WEF even has a Centre for Public-Private Partnerships. Here is the WEF FAQ, which includes the following nutshell explanation for its activities:

"The World Economic Forum brings together leaders in business, politics and society for reflection and connection to generate ideas and proposals, bridging countries and cultures to address the issues affecting our world. We also bring the very best minds and experts to provide the necessary insight to allow leaders to make decisions that can bring about change for the better. Conferences like the Annual Meeting in Davos and regional summits are an occasion for leaders to outline major challenges and define strategies to address them.

WEF is not to be confused with the Bilderberg Group, which is cloaked in secrecy and does nothing to discourage millions of skeptics that reasonably wonder if executives of large corporations are lobbying invited government leaders behind closed-doors to change public policy and influence the awarding of contracts. You may remember Gordon Campbell attended the 2010 Bilderberg meeting in Spain during what was his last spring as Premier of B.C. The conclusions of the Conflict of Interest commissioner left many in B.C. shaking their heads.

But there are a few common elements. The WEF website's media guidelines say the Plenary Hall, Davos and Lugano rooms are open to press and on the record, one-on-one sessions are open on a reservation basis, but "all other sessions are off the record... members of the reporting press are not allowed in these sessions."

Some of the world's biggest corporations are involved as partners of the WEF. Participation in the WEF allows the 100 "strategic partners" to gain business intelligence and promote their goods and services to potential new customers, including governments. Or, as the WEF website says: 

"They believe in the power of multistakeholder interaction to drive positive change and work closely with the Forum to help shape the industry, regional and global agendas... Strategic Partners make a tangible impact on global issues and society by contributing to better policy-making, informing business decisions, sharing best practices and engaging stakeholders beyond commercial objectives."

In January 2011, the Sunlight Foundation blog noted how the annual WEF in Davos is a haven for high-powered lobbying. 

"Davos isn't just a place where the wealthy, influential, and powerful get together to swap ideas. It's also a place for the heads of business to lobby the most influential policy makers and regulators in a confined atmosphere."

Don't forget, the Tianjin version of WEF is called "the Summer Davos" by its promoters.

Some of the WEF partners are magnets for controversy:

Adecco Group, whose Norwegian arm was involved in a major scandal uncovered by domestic media.

Bain & Co., which has a deep connection to U.S. Presidential candidate Mitt Romney.

Barclays, the British banking giant involved in the massive LIBOR interest rate-rigging scandal.

Booz & Co., which offers consultation services to the global aerospace and defence industry.

BP Plc., whose Deepwater Horizon oil disaster in the Gulf of Mexico is costing $38 billion.

Deloitte, the accounting firm which is alleged to have had a bit part in the Standard Chartered money-laundering scandal.

Ernst & Young, which is being sued by Hong Kong's securities regulator for failing to disclose documents. 

Goldman Sachs, called "Government Sachs" and "Premier Theme Park of Finance" by the New York Post. 

HSBC, under fire in the U.S. for allegedly helping launder billions of Mexican drug cartel dollars. 

Standard Chartered, which is in trouble for hiding billions of dollars of transactions with Iran.

Dow Chemical Co., which was criticized for sponsoring the London Olympics by the London Assembly. 

Clark will be familiar with WEF partner Accenture, which took over part of BC Hydro in a privatization deal brokered almost a decade ago by her 2011 BC Liberal leadership campaign backer and lobbyist Patrick Kinsella.

And then there's Deutsche Post DHL. 

Perhaps you've heard of them? This WEF partner is the German parent company of Liquor Distribution Branch suitor Exel Logistics and also the parent company of Giorgio Gori. Gori is an Italian company that has a tight business relationship with ContainerWorld that, according to Exel's own internal documents, includes an option to buy the giant Richmond warehouse. ContainerWorld is also seeking the LDB contract. Until March 30, Clark's queenmaker Kinsella was registered as a lobbyist for Exel.

Various arms of Deutsche Post DHL, including Exel, were involved in price-fixing cartels, but the European Commission didn't levy the company fines because it cooperated.

Here is Deutsche Post DHL's profile on the WEF website:

Deutsche Post DHL is the world’'s leading mail and logistics services group. The Deutsche Post and DHL corporate brands represent a one-of-a-kind portfolio of logistics (DHL) and communications (Deutsche Post) services. The group provides its customers with easy-to-use standardized products as well as innovative and tailored solutions ranging from dialog marketing to industrial supply chains. About 470,000 employees in more than 220 countries and territories form a global network focused on service, quality and sustainability. With programmes in the areas of climate protection, disaster relief and education, the group is committed to social responsibility. In 2011, Deutsche Post DHL generated revenues of 53 billion euros. The postal service for Germany. The logistics company for the world.

Don't be surprised if Deutsche Post DHL's big-wigs and heavy-hitters are in Tianjin at WEF on Sept. 11, coinciding with Clark's visit. The company announced in July an aggressive expansion in China and wants to derive a third of its business from China by 2017.