Among the oaks

There is no better place to sit and think than on one of the rocky outcrops offering entrancing views of the magnificent Haliburton landscape.

I am sitting on one now, staring down at the mysteries of forest life, and into a clearing where perhaps a doe and her fawn, or a meandering black bear, might appear.

This is a wonderfully intriguing place, but not just because of the chance to see wildlife. From my vantage point I get to study a small piece of nature and reflect on what a great teacher it is.

What fascinates me is how anything can grow on this hill of blue granite, created thousands of years ago from a surging of molten rock.

There is little plant life on this tabletop of hard rock. Yet somehow there are trees. Not just any trees, but regal red oaks standing strong and proud like monarchs overseeing their kingdoms.

Somehow these oaks made a home here. Over many decades, decaying vegetable matter carried by the winds gathered into crevices in the rock, eventually becoming soil. Acorns dropped by birds, squirrels or wind found their way into the soil-filled crevices and began the lives of the mighty oaks now here.

However, some of the oaks are mighty no longer because they are not standing. And that’s the reason that I am up here.

A couple of summers ago a wild, twisting wind roared into this forest, knocking down poplars and evergreens in the lower areas. Not content with wreaking damage down there, the wind turned and spun its way up and across this rocky hill.

The oaks are rooted tenuously on the rock, and sixteen of them were uprooted by the wind, which I believe was small tornado. It was sad to find them lying there, their only use now being winter firewood, to which I am entitled because I have legal deed to this forest although in fact I am only its temporary custodian.

Cutting firewood is satisfying, but tiring, work. So whenever I stop the chainsaw to take a rest I sit on the rock and think about this forest.

The similarities between human life and the lives of trees in this forest are fascinating.

The oaks have formed a colony on this rock tabletop because they are strong and conditioned for living in meagre conditions. Enough rain slides off the smooth rock surfaces into crevices to quench the roots’ thirst.

Below the hill, the fast-growing poplars have colonized the soft, rich soil areas. Some now are 80 to 100 feet high, threatening to block the sunlight needed by the oaks on the hill. Poplars, unlike the oaks, have a short life span and the tallest ones will have expired before they become a real threat to the oaks.

Two other interesting trees have gathered in preferred living areas of this forest. Young white pines, once the dominant tree species of this part of the country, are populating open areas featuring sandy soil conditions. Here their roots can spread easily and their needles can catch the sunlight and the open air that they love.

Farther off to my right and out of sight are the clean-cut, smooth-bark beeches. They occupy an east exposure hillside that bathes in the morning sun.

Not one beech is found on the far side of that hill. Why I am not sure. Perhaps they simply favour the morning sun over the evening sun. They seem to have found a place they like and have no intention of spreading farther.

These tree families are much like people families. There are times when change forces them to migrate. When they do, they pick places where they believe they can put down roots, have productive lives and raise future generations.

Looking down from this outcrop I can see patches of mixed forest. Areas where pines, poplars, oaks, maples and beeches are living together despite their different needs and preferences.

The human world also is well along the way to blending into a mixed forest of people.

When you sit staring out from a rocky outcrop, nature tells you that while there are many species of trees, and many different races of people, trees are still trees and people are still people, no matter what their differences.

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The unfair cottage tax

The campaigning has yet to hit full stride, but federal election day is just over a month away with plenty of serious issues to debate. There is one issue that will not see any debate, probably because it does not impact large swaths of voters.

That issue is the unfairness of the capital gains tax on cottages. It is an issue that causes much grief among older folks wanting to pass the family cottage on to the next generations.

Capital gains tax applies when a capital asset is sold for more than the purchase price. For instance, if you bought a stock for $1,000 and sold it for $10,000, capital gains tax applies to 50 percent of the $9,000 gain. So you pay tax on $4,500 at your marginal tax rate.

Seems fair enough. Make a profit, pay tax.

It’s not when it comes to trying to keep a cottage in the family.

Here’s the unfairness: You built a modest cottage on a lake 35 years ago. It cost $35,000 to acquire the lot and to get the bare bones basics built.

The children grew up enjoying the place, swimming, paddling, hiking, nightly campfires and all the other fun things children do at cottages. Suddenly they are adults with their own children and the cottage, which has undergone various renovations and additions, is being enjoyed by three generations.

People don’t last forever so the time arrives when the parents who built the place pass away, leaving the cottage to one or more children.

Improvements over the years added some value to the cottage. But basically it’s the same place, on the same lake, providing the same family enjoyment.

The improvements over the decades might have raised the total cost of the place to say, $100,000. However, when the children inherit it, they are shocked to find the market value is $600,000.

So federal tax law says that the market value of $600,000, minus the $100,000 total cost of the place, means there has been a capital gain of $500,000. The inheritors then are stuck with paying capital gains tax on one half of that gain, which could be a $100,000 or more tax bill depending on their marginal tax rates.

The children don’t have the money to pay the tax so they sell the cottage and pay the tax from the sale price. They now have a nice bundle of cash but the cottage that was a family treasure for 35 years is gone.

There no doubt are people who build or buy cottages to fix up and sell for profit. Their goal was to turn a profit, so it seems fair that they pay capital gains tax on the profit.

However, the family cottage enjoyed by three generations is different. The parents built it for pleasure, with no thought of financial gain. In fact, most family cottages are a financial drain – the price paid for the family’s enjoyment.

Improvements increased the cottage value. But they were made to accommodate the growing family. There was no expectation of financial gain or that the value one day would be $600,000.

A chunk of the increased value came from inflation. So part of the capital gains tax payable on the cottage is simply for inflation.

Look at it another way. You bought stocks in 2008 for $100,000. Over the 10-year period ended June 2018 inflation was roughly 16 per cent. So the $100,000 of stocks bought in 2008 now are worth $116,000 in 2018 dollars.

That $16,000 of inflation is a gain that is taxable if the stock is sold. Yet the $116,000 in 2018 dollars has no more purchasing power than the $100,000 in 2008 dollars. It is a larger number but because of inflation cannot buy more goods or services.

There are ways to reduce capital gains tax on a cottage passed to family members. However, finding the best ways involves hiring lawyers, accountants and realtors to work out the details.

I failed high school math twice so I’m not a reliable source on details of capital gains taxes. However, my rudimentary understanding tells me it is an unfair tax in legitimate cases of parents wanting to pass along the family heritage cottage to their children.

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When presses go silent

Silence is not always golden.

Sometimes it is sorrowful, even hurtful.

It was all that when the thunder of newspaper presses at The Hamilton Spectator faded to a whisper, then silence, last Friday.

It was like watching a heart stop beating. Presses that had printed billions of words of news for millions readers over many decades suddenly still and silent.

Those presses will not roar again. A hole will be smashed through a side wall of The Spectator building and a scrap dealer will dissemble and remove the colossal machines.

A small group of employees and former employees witnessed the final press run. I was among them because I have family connections to the paper, plus those presses printed many of my stories, written as a wire service reporter, later as a freelance writer.

The Spectator will continue to serve its readers in print and online, but printing and distribution will be done elsewhere by other people.

Watching the presses go silent was heartbreaking. But beyond the heartache and the nostalgia is the realization that a final press run is a reflection of what is happening in the newspaper business across North America and around the world.

Presses are going silent and are being sold for scrap metal to save money as newspapers fight plunging circulation and reduced revenues. It is a fight for life that started two decades or more ago. Many papers have not survived.

In Canada, more than 200 newspapers have closed in the last 10 years – 13 of them paid circulation dailies in fair-sized cities and 189 community newspapers in smaller centres.

In the United States there have been roughly 1,800 newspaper closures since 2004, more than 60 of them dailies. Newspaper circulation declined 40 per cent in the U.S. during the same period, and newsroom employment fell 45 per cent.

One result of all this is expanding news deserts – widening areas without newspapers. The number of communities whose citizens have diminished access to news critical to their lives, and to democracy, is growing rapidly.

This is a shame because we live in a time of misinformation, manipulated information and information massaged and shaped to benefit political and business interests and the powerful people behind them.

Newspapers and their professionally-trained editors and reporters are needed to correct and balance one-sided information by gathering and reporting facts. Despite the industry’s problems, the quality of newspaper reporting and writing has increased significantly in recent times.

Newspaper owners and publishers must accept some blame for the decline of newspapers and the resulting weakening of our democracy.

They lacked the foresight and innovation needed to maintain their newspapers’ important role in a changing society. They continued to do things the way they always had done, while new and innovative players like Microsoft, Amazon, Apple, Google, Facebook and Twitter exploded on the scene and changed the world.

The game is not done yet for the newspaper industry. Its future lies in delivering its important work to readers online.

It must, however, regain newspaper readership and that will require much innovative thinking. Much thinking in the past was about how to attract and please advertisers and not enough on readers, who are the industry’s most important customers.

Advertisers are important because they pay the bills and add value to the newspaper products. But without the most important customers – the readers – there is no need for advertising.

The newspaper industry needs to engage readers directly to help them understand

how news is collected, how decisions about news are made and how it affects their lives. To show them that the only true news is news based on provable facts, balanced by context, and free of bias and opinion.

Newspaper owners and publishers need to get out of their offices and talk with readers because there is no future for newspapers without an engaged and committed readership.

There are a lot of intelligent people in the newspaper industry and my guess is that they will figure out how best to revive and revitalize this crucial aspect of our lives.

We have to hope so because as The Washington Post masthead states: Democracy Dies in Darkness.

It also dies when presses, or the digital production equipment that replaces them, go silent.

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