Debates of Oct. 29th, 1998

Foreign Publishers Advertising Services Act

[Monte Solberg, Reform, Medicine Hat, AB]

Madam Speaker, my question for the parliamentary secretary has to do with the likely retaliation we will get for continually beating our head against the wall with this legislation. We know it was substantially defeated the first time it went before the WTO. Now we are trying a back door approach which we know will fail again. All we are going to do is incite problems with our biggest trading partner, a country we trade with to the tune of $1 billion every day.

Can the hon. member tell us why he thinks we are not going to face reprisals as we have faced in the past, perhaps in other areas such as farming where we already have a huge crisis in this country? Why would the government risk that type of reprisal to push through legislation it knows will ultimately fail?

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Madam Speaker, I have to disagree totally with the member's premise that this will fail. We believe this will sustain any test of the world tribunals for exchange in respect of our general agreement on services. The notion that we as a country should not proceed because of the threat that our neighbours to the south may not like it is a rather sheepish way to deal with our own sovereignty.

Canada has negotiated international trade agreements that have excluded cultural matters entirely. It is in keeping with this strategy that as a country which is somewhat smaller in terms of population than our neighbours to the south, our cultural sovereignty is not to be put at risk. It is not to be put on the table. It has been excluded from these agreements. This is in keeping with that strategy.

The government is quite comfortable that with this legislation we will continue to have a thriving periodical industry which we would not have if we did not act.

[Grant McNally, Reform, Dewdney—Alouette, BC]

Madam Speaker, it is quite clear what the government is attempting to do with this bill. It is attempting to redefine advertising as a service instead of as a good. It is trying to go through the back door with this legislation. It is very clear.

The hon. member mentioned that this bill is consistent with Canada's trade obligations. How in the world can he justify that comment given the facts mentioned by my colleague and that this legislation in its previous life had no success at the WTO? It is simply bad legislation. How can he say this is consistent with Canada's trade obligations when it goes against NAFTA, an agreement this government applauds?

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Madam Speaker, the hon. member is mistaken to say this goes against NAFTA. Cultural matters have been excluded from NAFTA. Whether or not this is referred to the World Trade Organization is a decision our neighbours to the south will make. It would be a rather sheepish way to run a country to cower because they threaten to do that. We are not prepared to do that.

If the member is not prepared to understand that there is GATT, and GATS where we are talking about services and not products, then that is where he is mistaken. It is the belief of this government that this will withstand the test wherever. Canada's cultural sovereignty has to be protected, defended, encouraged and promoted. That is what this government has done and will continue to do.

[Lee Morrison, Reform, Cypress Hills—Grasslands, SK]

Madam Speaker, I find it rather strange that the word culture keeps being used when we are talking about advertising and revenues. This is commerce. Through this back door legislation the government is trying to bend the intent of NAFTA and other trade organizations.

The member talks of cowering. It is not cowering to maintain good faith in international trade regulations. That is not cowering; that is being honest.

I would like the hon. parliamentary secretary to tell us if he does not feel that Canada is a big enough kid in the world to at least behave decently in its trade relations.

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Madam Speaker, first regarding this notion of the back door, if the member equates the floor of the House of Commons as the back door, then he has a problem. The government is not attempting to use any back door here. It is presenting legislation on the floor of the House of Commons, the Parliament of Canada. That is far from a back door, number one.

Number two, if the member is not prepared to understand that the cultural industries need support such as advertising services which could be scooped up by foreign publications, then obviously he is out of tune and is not in touch.

[Sarmite Bulte, Liberal, Parkdale—High Park, ON]

Madam Speaker, it is with great pleasure that I rise to speak on behalf of Bill C-55, an act that will ensure that a vibrant and successful Canadian magazine industry continues to provide Canadians with stories that reflect our values, our culture and our points of view.

I also rise to speak on behalf of all those Canadians who want to see themselves, read about themselves and learn about each other from other Canadians and not to do so vicariously through others, most notably the Americans.

Bill C-55 is in keeping with the longstanding policy of this government of promoting and investing in Canadian culture. It is a policy that over the past 40 years has clearly been a success as there are currently 1,500 Canadian magazines on the market.

It has often been stated that the question is not whether we ought to support Canadian culture, but how best to support it. As the Right Hon. Kim Campbell, our current consul general in Los Angeles said in a speech in March 1997, “Cultural industries are our national defence. A country must be able to articulate its own reality in its own voices and it is not always easy in Canada”.

Support for culture is needed in Canada as the U.S. and Canada share the world's largest bilateral trading relationship at over $1 billion a day, 365 days a year and the world's longest undefended border.

As Robert Lantos, the former chairman of Alliance so eloquently stated last Monday evening, “We must never forget that our economic and cultural sovereignty are inextricably intertwined”.

Yet 95% of Canadian movie screens are showing American films. It is almost impossible for a Canadian film to be shown on a Canadian movie screen. Eighty per cent of English magazines on Canadian newsstands are American.

Bill C-55 ensures that Canadian magazine publishers continue to have access to Canadian advertising dollars. Advertising revenue is the lifeblood of this industry, with advertising accounting for an average of 60% of total revenues in the magazine sector. This is an economic fact. At the same time, Canadian publishers are using advertising dollars to produce Canadian stories for Canadians. If this revenue were to decline, it would not be long before Canadian publications and the Canadian magazine publishing industry would suffer and become less viable.

If this bill were not in place, Canadian magazines would not be able to compete with split-run editions of foreign magazines that have no editorial costs. This gives foreign publishers an unfair competitive and economic advantage. These foreign magazines would be in a position to scoop up Canadian advertising dollars by offering lower advertising rates than their domestic competitors. Canadian magazines simply cannot survive without sufficient advertising revenues.

One must not take a short-sighted view of this issue. If this situation were to perpetuate, this would inevitably lead to a reduction in the number of Canadian magazines. A reduction in the number of magazines would also lessen competition and could lead to higher advertising rates in the future.

Those who advocate a completely unfettered free market should consider the potential long term implications on Canadian culture and on our economy. We care about the survival of our culture and our economy.

Last spring in a mailing survey of 50,000 Canadians conducted by 12 magazines, 84% of respondents said that it is important to them to read Canadian stories. This government wants to ensure that Canadians continue to have access to their own ideas, stories and information. This is why Bill C-55 is so important.

The act will only prohibit foreign publishers from supplying advertising services directed primarily at the Canadian market to a Canadian advertiser. Canadian governments have long maintained measures to prevent this from happening. As a result of these measures, U.S. publishers have not had access to the Canadian advertising services market for over three decades.

Some U.S. publishers are not satisfied with their already very generous share of the Canadian magazine market. They also want to dominate our advertising services market by producing split-run advertising editions of the magazines they already sell here.

I cannot overemphasize the fact that this measure deals only with supplied advertising services to Canadian advertisers. It will not affect the importation of foreign magazines. It will not affect any Canadian reader's ability to purchase foreign magazines at newsstands or through subscriptions. The Canadian market will continue to be among the most open in the entire world.

In addition foreign publishers such as Time magazine currently operating in Canada will be exempt from this new bill. They will be able to maintain their current level of activity.

My colleague was absolutely correct that this bill is fully consistent with our international trade obligations under GATS, the agreement on services. Yet culture, as this government has said many times, cannot be seen as simply another trade issue. This bill is about preserving a Canadian voice in a country that shares the world's largest bilateral trading relationship with the United States.

This bill does not affect the content of magazines. Publishers will continue to produce editorial content that they consider attractive to Canadians. Nor does Bill C-55 affect the price of magazines. Canadians will continue to enjoy access to foreign and domestic magazines that are competitively priced.

Bill C-55 provides a mechanism to promote and support Canadian culture with no new cost to taxpayers. Bill C-55 has also received strong support from the Canadian Magazine Publishers Association and the Canadian Business Press, which together represent some 450 consumer magazines from across the country.

For over 40 years measures have been in place to prevent split-run editions of foreign magazines. New measures have been announced, not new policy. This law is in keeping with longstanding cultural policies. It ensures that Canadian magazine publishers have access to the funds that they need to survive.

This bill takes nothing away from Canadian advertisers. Advertisers will continue to have all the advertising opportunities they had in the past, including the right to purchase advertising services from foreign publishers, as long as the advertising service is not directed primarily at the Canadian market.

In closing, Bill C-55 will guarantee that Canadians continue to have access to stories about Canada, written by and for Canadians and confirms this government's commitment to, and investment in Canadian culture.

[Monte Solberg, Reform, Medicine Hat, AB]

Madam Speaker, the hon. member mentioned a minute ago that magazines such as Time will be grandfathered in this legislation and therefore will not have to comply with these new rules that the government would propose to push through. I wonder if the member can explain why, if the principle of having American magazines in Canada not being allowed to pick up Canadian advertisers, she thinks that principle of allowing them to have Canadian advertising is wrong.

How in the world can she justify grandfathering in a magazine like Time which obviously would pick up a tremendous amount of Canadian advertising? How can she justify the double standard? If it is wrong, it is wrong.

[Sarmite Bulte, Liberal, Parkdale—High Park, ON]

Madam Speaker, the legislation is aimed at split-run magazines like Sports Illustrated which basically takes Canadian advertising dollars with no Canadian content. Time is an exception. Time has been in Canada for years. Time has Canadian content. Time is not a split-run edition. Time cares about Canadians. Time continues to tell Canadian stories.

This is aimed at split-run magazines that are beamed in by satellite without any need, any want or any desire to speak to Canadians about themselves.

[Wendy Lill, NDP, Dartmouth, NS]

Madam Speaker, I would like to ask a question about the member's comment that there would be no new cost to taxpayers.

I checked with the heritage department about the removal of postal subsidies. It made the point that as a result of the changes required by the WTO, Canada Post would eliminate the international publication rate which was higher than the domestic rate. Foreign publishers would therefore benefit from reduced postal rates to a tune of an estimated $18 million.

Where does the mailing cost come from if not from the taxpayer?

[Sarmite Bulte, Liberal, Parkdale—High Park, ON]

Madam Speaker, the hon. member is correct that there will now be a level playing field between foreign magazines and Canadian magazines.

I do not believe there will be additional tax costs for the taxpayers of Canada.

[Lee Morrison, Reform, Cypress Hills—Grasslands, SK]

Madam Speaker, the hon. member seems to talking about split runs. When she talks about Time magazine it is more like the splitting of hairs.

Could the hon. member inform the House if she is in general support of the Canadian Charter of Rights and Freedoms or perhaps the Canadian bill of rights? Does she believe in freedom of expression, freedom of the press, freedom of association or the right to deal in property?

Does the hon. member take seriously, agree with or support any of these principles or concepts?

[Sarmite Bulte, Liberal, Parkdale—High Park, ON]

Madam Speaker, yes, I do.

[Inky Mark, Reform, Dauphin—Swan River, MB]

Madam Speaker, if the hon. member believes in free speech, why are they putting up protective barriers on a split-run issue in Bill C-55?

[Sarmite Bulte, Liberal, Parkdale—High Park, ON]

Madam Speaker, we are not putting up protective measures. Let us stop talking about protection. Let us talk about what we are doing.

We are promoting and investing in Canadian culture. We are not protectionists. Where is protectionism when 95% of our films are American and 80% of our magazines are American? It is not protectionism. It is investment and it is promotion of Canada's cultural industry and arts.

[Monte Solberg, Reform, Medicine Hat, AB]

Madam Speaker, it is a pleasure to rise to address Bill C-55. I am a bit familiar with the bill. It first came into being three or four years ago in a different version. At that time I was critic of the Department of Canadian Heritage so I had the chance to explore what the government was up to at that point. As the Reform Party predicted, that legislation was ultimately defeated at the WTO.

I will go out on a limb and say that this will be pounded down again by the WTO, which will leave Canada wide open to retaliation on all kinds of trade fronts. I cannot believe the government is so imprudent that it would allow the legislation to go through and threaten in many cases other industries that are already in great peril. For instance, I point to the farm industry which is important in my riding. I will get to that in more detail later.

I want to address a couple of remarks made by my colleague who just finished speaking a minute ago. She mentioned that Time cares about Canada. I point out that it is the Time Warner corporation of the United States. I do not think anyone really believes that Time Warner Inc., a huge media conglomerate, cares about Canada. It cares about making money for its shareholders.

Incidentally that is exactly the same thing that drives Ted Rogers and the Canadian Magazine Publishers Association that are naturally in support of the bill. They do not care about Canada. They want to make a profit. If the government ensures that they can make a profit by protecting them with huge fines, contrary to what the member said we should not be very surprised. They do not care about Canada. They want to make a lot of money. That is their right and we understand it. We do not think there should be government intervention that allows them to do it. Let us see some real competition in this country.

I want to expand on that point for a moment. Recently the National Post was launched in Canada. It will be Canada's second daily national newspaper, which means that the Globe and Mail , an excellent newspaper, has some tough competition.

The Globe and Mail has improved a lot over the last several months as it has geared up for this launch. The National Post is producing an excellent newspaper. What we are seeing are the benefits of competition.

When we have competition, we have better newspapers all of a sudden. It is amazing but it happens over and over again. Everyone has to get better. I see the same thing happening on TV. We had News 1 launched on CTV and all of a sudden we see Newsworld is improving its set and changing its hosts. What would happen in Canada if we had wide open competition in our magazine industry? Canadian magazines would improve.

My hon. colleagues across the way know this is true. Otherwise they would not have reversed their stand on NAFTA. They know that real competition makes everyone stronger. They completely changed their stripes on NAFTA because they know that is true.

Now they want to have their cake and eat it too with protectionism of an industry as my colleague from Swift Current pointed out. They can cloak it in language about our sacred culture all they want, but this is about making money and my colleagues across the way know it.

I want to expand on a point I made at the outset. Under the WTO rules if a piece of legislation is struck down, goes back for a second time and is struck down, the field will be wide open for retaliation from the country which was the target of the legislation. In this case it is the United States.

My colleagues across the way have had some experience in dealing with the United States and trade problems in the past. It was not very long ago when we saw Canada get into some trouble with the U.S. over protection for poultry and dairy. As a result what did the United States do? It capped exports for durum in the west. It did not go after the industry it was concerned about. It picked another weak spot, one that it knew was politically sensitive.

What will happen when this is ultimately defeated again at the WTO? Will the Americans say they will ban our magazines coming into the United States? I do not think so. That would not be very much. They will go after wheat exports, cattle or something that has a profound impact on Canada. The government knows that. It has been warned about it for the last four or five years.

The government is going ahead anyway because the minister is so stubborn. Because she cannot spend a bunch of money any more on Canadian heritage she has to justify her existence somehow. She is going into this area willy-nilly, not caring one bit about the damage it will ultimately do to the rest of the country. She knows exactly what the outcome will be but she does not care.

When I go back to my home town of Brooks and sit in the coffee shop, in Aces Cafe; when I go to Bow Island and sit in Grandma's Kitchen; or when I go to Medicine Hat and sit in the co-op, I sit around the table with my constituents. We do not talk about the horrible tragedy of Sports Illustrated coming into Canada with Canadian advertising. They talk about the fact that they will not be able to make their payments for fertilizer, fuel and such things.

They understand what the government does not understand, that people have to make a living. When they see legislation like this which threatens their existence at a time when they are already in tremendous danger, they wonder what goes on in Ottawa. They call it the puzzle patch. I do not blame them because I am pretty puzzled about what the government is up to.

It is beyond absurd that the Liberals are preparing to endanger trade with the United States, a billion dollars a day, at a time when according to the finance minister we are facing an economic meltdown, an apocalypse of some kind. On the other hand they are endangering trade with the one partner we can count on. Eighty-five per cent of our trade is with the United States. Yet the government is setting us up for a trade war with the United States. How ridiculous can that be?

I wonder if my friends across the way, who are laughing right now, would like to come back to Brooks, Alberta, to Bow Island or to Vauxhall and sit and laugh when my constituents tell me they will not make it through the winter or be able to sow their grain in the spring. It is not a laughing matter; it is deadly serious.

The Liberals across the way had better wake up and understand that the bill has implications far beyond magazines. It does not make sense to subsidize Ted Rogers. He already has enough millions in the bank. We do not need to subsidize Philippe de Gaspé Beaubien. He already has enough money.

It is ridiculous that the government has to try to justify its existence as a player in Canadian culture by putting in place a foolhardy piece of legislation like this one. It is absurd. It is no wonder Canadians are so cynical about this place.

I encourage government members to wake up, especially rural members who know how much this can damage their own constituents. I see the industry minister here. In the past he has had some knock-down, drag-'em-outs with the cultural minister on this issue because as a businessman he knows that this is bad business.

I encourage members across the way to wake up, defeat the legislation and ask the minister not to pursue it because it will damage Canada a lot more than it could ever help it.

[Mauril Bélanger, Liberal, Parliamentary Secretary to Minister of Canadian Heritage]

Madam Speaker, I want to point out some of the contradictions the member across does not shy away from. He claimed at one point that people have to make a living. We all agree with that. However he would discard, out of hand, without a second thought, the 6,000-plus Canadians who work in this field. He does not seem to care about that field.

We care. A government has to be responsible and take a balanced approach. The government has an incredible reputation worldwide as a trading nation. We have participated in international treaties to allow free trade. We have respected those treaties. We have been consistent in saying that cultural matters are not to be included. We protect, enhance and promote Canadian cultural industries.

There does not seem to be a problem over there with people making money except when it comes to people working in the cultural fields. There are 6,000 people working in those fields. What about the people working in the film industry, the TV industry, the book publishing industry and the music industry? They would discard them out of hand. They say that they cannot make money. They say it is okay for others to make money but not for people in the film industry, the publication field or in periodicals.

Such inconsistencies speak exactly of the attitude of this party. It cowers in front of the Americans. The Americans say boo, it sheepishly says it cannot do this.

This government is standing up for Canadian cultural industries and will continue to do so.

[Monte Solberg, Reform, Medicine Hat, AB]

Madam Speaker, I do not know what to say to that other than that is absolute rubbish.

If the government really is as brave as the member suggests, why is it putting up huge protection barriers around the magazine publishing industry in Canada? He just said we were cowering. It is his government that is putting up the barriers. It is going to impose huge fines on Sports Illustrated or whatever because the government would dare to allow Canadian advertisers in advertise in those magazines.

It is ridiculous. The member argues on the one hand that the government is going to protect Canadians. On the other hand it is denying Canadian advertisers a vehicle by which to promote their goods and services. He cannot have it both ways. We want these people to make money too. We do not make money by giving them a subsidy and protecting them from competition. That is how we kill industry. My friend should know that.

We had protectionism in this country for years. As an example, we had textile producers in southern Quebec. What happened to them? Ultimately they could not compete when the barriers came down. We need to get rid of those protectionist walls. We want Canadian cultural industries to make money.

I encourage the government to take some of its own advice and allow them to make money by allowing free competition so they can export around the world. What we want is to see lower taxes so they can compete. We want to see those people succeed like they have already done in other areas of Canadian culture where there is no protectionism.

I point out to my friend that we have many great Canadian novelists. They send their products far afield. They do extraordinarily well. We do not have protectionism for them. When they produce a novel they sell it around the world and those novels come back here. That is not what the government is proposing for the magazine industry. It wants to create a problem not only for the magazine industry by allowing it to atrophy because it does not have competition but ultimately it will cause all kinds of problems for the rest of the country by creating a trade war with our biggest trading partner. It is ridiculous that the government would do that.

[Roy H. Bailey, Reform, Souris—Moose Mountain, SK]

Madam Speaker, the hon. member for Medicine Hat will know where I am coming from when I talk about one of the cultural things on the prairies, weekly newspapers.

Everybody looks forward to a weekly newspaper. Because of the sparse population one of the biggest cost factors this cultural avenue has is the high cost of Canada Post. The hon. member in the NDP asked a question about this. Now we are going to give special reductions to some newspapers coming into the country. I cannot wait until my weekly newspapers that have been fighting with Canada Post forever about special rates to get their cultural piece of information out find out about a special Canada Post regulation to bring magazines into Canada. Every small paper struggling to survive is going to damn this government if this proposal goes through.

I would like the hon. member for Medicine Hat to comment on our cultural activities.

[Monte Solberg, Reform, Medicine Hat, AB]

Madam Speaker, I thank my colleague for his question.

This government thinks Canadian culture is what a lot of people might call high culture. Most people today make connections with their neighbours around their province and around the country through weekly newspapers and little publications like that. One of the things that works against them is the exorbitant prices they have to pay for postage today. The member is absolutely right.

The other point is that these companies are just like any other company. They struggle to make it with crippling payroll taxes. In many case they have a lot of employees. It is labour intensive.

They sit and they stuff flyers in newspapers. I have a good friend who is the publisher of the Brooks Bulletin . They have a big staff. This publisher would love to see EI premiums go down by $500 per employee. Those employees would like to see their premiums go down by $350 which is entirely within this government's ability to do if it would obey the law.

But sadly this government thinks the answer is to protect these business by putting up these high protective walls which ultimately are going to be challenged and defeated at the WTO. We are going to pay a huge price for it when we are retaliated against. Unfortunately the retaliation will not be in magazines. We will be hit where it hurts, in the big industries such as agriculture and lumber. My colleague shakes his head but I will bet him $20 that is exactly what is going to happen.

[Rob Anders, Reform, Calgary West, AB]

Madam Speaker, I have heard about political interference today and it bothers me greatly. I challenge the member for Medicine Hat.

He talked about political interference and about retribution. Indeed that goes on. He talked about regulation and protectionism and the Liberals in this country being wall builders. But the thing the member did not touch on, the thing the member left out of his speech, was the type of corporate welfare we have in this country, the type of corporate welfare the Liberals have been engaging in. The Liberals cut health care and education and they give billions of dollars to their friends such as Bombardier.

I would like the hon. member for Medicine Hat to touch on what goes on in this country in terms of corporate welfare and subsidies.

[Monte Solberg, Reform, Medicine Hat, AB]

Madam Speaker, the member threw me a hardball but let me see what I can do.

I have noted that Bombardier gets a little help from this government. I also noted that Bombardier made a profit last year in the range of $235 million. But we also know, thanks to the Canadian Taxpayers Federation, that but several aerospace concerns have received not hundreds of millions but over $1 billion in subsidies. To me that is unbelievable.

How much of these repayable loans have been paid back? I see the minister of industry is in the House. A fraction get paid back, 2% or 3%. I think it is unbelievable that this government will slash health care, attack all the programs that are extraordinarily important to Canadians but still pump billions of dollars into corporate welfare for companies such as Bombardier and many others.

I hope I have adequately answered the question from my colleague for Calgary West.

[An hon. member]

Tell us about Ted Rogers.

[Monte Solberg, Reform, Medicine Hat, AB]

The member mentions Ted Rogers. I am glad he pointed that out because under this legislation what this government is doing is pumping more money into the pocket of Ted Rogers, a media mogul in this country, a multimillionaire who hardly needs the help.

I wonder why it is that when the chips are down this government has to help out its billionaire friends? I think it is unbelievable.

[Wendy Lill, NDP, Dartmouth, NS]

Madam Speaker, as my party's critic for culture and communications I am pleased to have the opportunity to speak to the contents of Bill C-55, an act representing advertising services supplied by foreign periodical publishers.

I was not able to be in the House to speak on this bill on first reading last Thursday but our member for Winnipeg—Transcona with his usual eloquence and clarity spoke to the bill so I will, in my own fashion, try to add to that.

To refresh members on the contents, Bill C-55 will make it an offence for a publisher to provide advertising services aimed at the Canadian market to be placed in foreign periodic publications except for those currently receiving Canadian advertising.

The offence is enforceable by a Canadian court after an investigation ordered by the Minister of Canadian Heritage using powers of investigation borrowed from the Criminal Code. The penalties range anywhere from $20,000 to $250,000 for a corporate offender on indictment.

The offences that take place outside of Canada by foreign individuals or corporations are deemed to have taken place in Canada for the purposes of endorsement of the act.

What we have here in effect and without doubt with Bill C-55 is an eleventh hour effort to protect the Canadian magazine industry from being truly swamped and I would say possibly sunk by the thousands of shiny, glossy, glitzy, sexy American magazines which we all see row by row, bicep by bicep, cleavage by cleavage in our airport bookstores and in the chains of American bookstores we now have all over our country.

It is not that I do not like American magazines. I like them a great deal and I have a tremendous admiration for American writers, the political commentators, the satirists, the sports writers, the poets and the playwrights. I like a whole lot about the United States and its talent and its spirit. But it is the volume and the velocity of the American product and the unrelenting manner with which it floods the Canadian shores which concerns me. It obviously concerns the Minister of Canadian Heritage as well or she would not be putting forward Bill C-55.

It is not the first effort and I doubt it will be the last effort to protect the Canadian magazine industry from the American tidal wave of publications. Nor is it the last effort probably to keep Canadian advertising dollars in Canadian publications.

In 1976 passage in parliament of Bill C-58, a statute which disallowed tax deductions by Canadian companies for their advertising expenditures in foreign periodicals and broadcasting outlets, obviously enhanced the attractiveness of advertising in Canadian media.

In 1982 postal subsidies instituted for Canadian magazines helped to stabilize Canadian periodical competitive position vis-a-vis American magazines whose overrun copies were simply dumped in the Canadian market.

In 1982 the Canadian Periodical Publishers Association termed the postal subsidy not only the oldest but in some ways the most effective of all the many kinds of cultural assistance created by the taxpayers of Canada. Postal subsidies were considered a true grant in the public interest.

Now it is 1998 and a lot of water has gone under the bridge. Now we have Bill C-55 and it is a direct result of a GATT panel overturning the Canadian policy on split run magazines, magazines which contain mostly American content but run in separate editions for Canada containing Canadian ads. Sports Illustrated , Readers' Digest and Time magazine are the best known examples.

Eighteen months ago a Canadian conference for the arts report on this ruling on the GATT case said: “World trade organization decision on magazines advances the cultural sovereignty doomsday clock”. What an ominous concept. The CCA strongly recommended immediate action in a number of areas and it is still very relevant to today and I am going to quote some. Number one is, not surprisingly, fix the magazine industry policy.

Second, Canada must aggressively promote and secure an effective and durable cultural exemption in all existing and proposed international agreements. Third, develop a systematic understanding of the constraints and challenges in cultural sovereignty posed by existing trade agreements.

It is clear that the federal government understands the impact of international trade agreements on culture as poorly as the rest of us. Who can forget the assurances that the former minister of Canadian heritage, the Hon. Michael Dupuy, gave to the Senate that officials in his and other departments assured him that C-103, the split-run legislation, was fully consistent with our international trade obligations. This has proven to be far from the truth.

The nature of the case made by the international trade officials at the WTO appears to provide abundant evidence that the situation has not improved. The government must move with dispatch to ensure that we have a clear and solid appreciation of the constraints and opportunities presented in the full network of international trade agreements and their impact on cultural sovereignty. We must develop a solid base of knowledge and talent in foreign affairs and international trade as well as within all government departments active in this area and the cultural sector itself.

Those were some comments from the CCA bulletin, the Canadian Conference of the Arts bulletin, of July 1997.

Eighteen months later I look at those cautionary remarks and I would say that we still have not gained the kind of understanding and self-knowledge that we need to pull this critical cultural issue out of the fire.

Instead, with Bill C-55 we see the failure of the Liberals to adequately protect the Canadian magazine industry under international trade agreements or admit, more to the point, where the problem lies.

Since the panel has proclaimed that Canadian policy cannot discriminate against foreign-owned goods, such as the product on paper of split-run magazines, the government will now try it under the definition of services such as the placing of advertising.

Will it work? Will it save the Canadian magazine industry? I am afraid this bill will likely be challenged as well, possibly under the NAFTA or under the FTA. I might add that it would definitely have been disallowed under the MAI which the Canadian government fought to keep alive until the end, which came last week.

With Bill C-55 we see the disappearance of the postal subsidies for Canadian magazines which were described in 1982 as a true grant in the public interest. As a result of the changes required by the WTO, Canada Post will eliminate the international publication rate which was higher than the domestic rate.

Foreign publishers will therefore benefit from reduced postal rates. There will be an estimated $18 million reduction in mailing costs.

The last section of the bill, section 24, the grandfather clause, is a legal surrender to American magazines which have already broken into the Canadian market. The NDP will closely examine that exemption in committee with a view to opening up new opportunities for Canadian publications.

In effect, this bill entrenches the status quo. There is nothing in the bill to promote Canadian content, to encourage more community periodicals or to bring forward new Canadian or regional voices. But it is an effort by the government and any effort cannot be spurned.

However, I would like to reiterate the central point made by my colleague from Winnipeg—Transcona that this is an effort to please, to kowtow to trade agreements and not, first and foremost, to protect and nurture our culture.

I would also like to reiterate his point that government members are not critical enough of the agreements in which they find themselves. I am talking particularly about the WTO.

There is a fundamental contradiction between the ideology, the world view embodied in the WTO, and the whole notion of protection of culture.

There is the fundamental contradiction between culture and free trade as it is understood by the WTO and the NAFTA. The fact is that our previous policy has been tested against the ideology and the world view of the WTO and has been shot down.

It is important for our government and our Minister of Canadian Heritage to admit to the fact that there are fundamental problems with these trade agreements. It is important that they recognize that their hands are tied by the rules of trade agreements which they were deeply involved in formulating.

The Liberals are in a box right now. The country and our culture is now in a box which is of our own government's making.

Now we have Bill C-55, a quick fix which will likely be challenged as well by the trade agreements which the Liberals and Tories before them were intricately involved in formulating.

The government is trying to provide a quick fix for a much larger problem which it had a hand in creating, the sacrificing of culture at trade negotiation tables.

Bill C-55, inadequate as it is, does represent a small effort on behalf of the government to protect our magazine industry, an industry that supports thousands of cultural workers, writers, publishers, copy editors, photographers and many others.

It is an industry that continues to go a long way, despite the onslaught of American magazines, to tell Canadian stories to Canadian people.

In conclusion, the NDP will support the principles of the bill and we will be voting in favour of it at second reading.