Attawapiskat is one of the few bands that posts their financial statements online. I actually just finished a course in reading government financial statements, so I skimmed through them. It turns out that First Nations financial statements are a lot more complicated than, say, the financial statement for the Government of Canada. Here’s a long blog post discussing the problems with First Nations financing with references to Attawapiskat. I wrote up a post with what I thought was the smoking gun but then I realized I had misread the statements (and hid my previous post because it’s embarrassing).

The trick with First Nations funding is that the federal government gives them a bunch of payments earmarked for certain areas of expenditure. This is similar to health transfers to the provinces – I’d argue that both violate the Constitutional sovereignty of these governments. The education situation in Attawapiskat is too complicated so let’s look at the housing fund:

The obvious question is why the hell is a housing fund spending so much on wages, “program delivery” and administration, and so little on capital? Are these euphemisms for repairs or fraud?

The huge jump in spending in 2007 was the year before a new chief and council got elected, which doesn’t make that much sense. The financial statements don’t say where the transfers come from (I believe it’s another Attawapiskat fund), but a big transfer in 2009 got spent on some kind of capital. Then a huge increase in government funding for 2010 didn’t get spent on anything.

Attawapiskat’s financial statements don’t make enough sense to say whether there is mismanagement but I’m skeptical of any organization that has so much variance from year to year. Most organization’s financial statements show steady operational expenses with occasional capital purchases. Insofar as protection of the citizens of Attawapiskat outweighs their right to self-governance, I support the federal takeover of their government. But why didn’t someone at Indian Affairs see this coming a long time ago?

1. hold a referendum
2. decide not to replace the bridge
3. get the money somewhere else

I’m not going to speculate on the political cost, but there’s an obvious way to do #3: a design-build-finance-operate public-private partnership. Instead of just constructing a bridge with government money, the construction partner borrows the money on the private market and the government promises to pay them fee over the lifetime of the contract. These partnerships make the most sense when there is a revenue risk, such as a toll.

The Golden Ears Bridge on the Fraser River is the obvious precedent. The Golden Crossing Group is paid a fixed fee and tolls go to Translink (I suspect a private partner would demand power to set the toll if it were their source of revenue). The contract includes things like safety bonuses, maintenance standards and availability guarantees.

The P3 idea was first floated, to my knowledge, by Victoria Vision. Putting a toll on the bridge would solve the complaint of some Victoria residents that they’re paying for a bridge used mostly by people living in eastern municipalities. The BC Liberals like P3s, so the project might attract some money from the provincial government.

I’d like to see a P3 request written generally enough to get both refurbish and rebuild proposals, which can then be compared based on hard, fixed costs. This can be done by specifying a pay scale for the hand-back condition of the bridge at the end of the contract: the company gets a pay-out based on years of life left.

Private-sector US Treasury Bond trades are done entirely electronically. It’s hard to believe, but central banks hold little pieces of paper worth a billion dollars each. Although the US claims that there aren’t enough such pieces of paper in the world for these to all be real.

This is stranger than fiction and of course there are all sorts of fun theories. If they’re all real, then no matter where they’re from, this is probably the end of the US$ as global reserve currency – which this blog keeps predicting over and over again.

You are declared bankrupt if you owe more than you can pay either to another player or to the Bank…If you have mortgaged MONOPOLY property you also turn this property over to your creditor but the new owner must at once pay the Bank the amount of interest on the loan, which is 10% of the value of the property.

This rule would cause Monopoly to be non-zero sum except that the rules also state “the last player left in the game wins the MONOPOLY game.” This imitates life because the last bank to go bankrupt is the mostly likely to get bailed-out.