Mr. Speaker, it is a pleasure to address Bill C-103.
The real question governments have to ask themselves when they are creating legislation that deals with issues like cultural trade policy is who is the real guardian of cultural trade or culture in Canada. We have to ask ourselves who is the real protector of consumers. Is it the government or is it Canadians themselves? Those are the critical issues.
I will not talk today about the technical aspects of this piece of legislation. We have done that in committee and over the last several days in other speeches. I will not get into that, but I want to talk a lot about the principle that surrounds who determines what culture is, which culture is worth protecting and why culture should be protected at all. That is the critical issue underlying the debate today. We are having a technical debate about this piece of legislation but it goes deeper than that. It goes right down to who is the guardian of culture in Canada. We can even extend that and say that it applies to the debate we have had on what is going on in Quebec, the referendum campaign, and who makes determinations about who knows best what is culture and that kind of thing.
I will talk about that matter over the course of my speech from a couple of different perspectives. I will to talk about it from the cultural perspective and from the economic perspective. Again the question is: Who knows better what is best for the ordinary consumer of cultural and the protection of culture and who knows best for the ordinary consumer, the ordinary person who pays taxes? I would argue in both cases that ideally it is individuals themselves and failing that it is lower levels of government.
First I will talk about the economic issues. The minister spoke at great length about how it was important to protect the magazine industry in Canada and that we needed the legislation to do it. What about all the other people affected by the legislation? It is not just the magazine industry that has a stake in it. Certainly advertisers use magazines as a vehicle to get their message out to the consumers. What effect will the legislation have on them?
I will give an example of how the legislation harms the ordinary advertiser and why that is a problem. A business somewhere in Ontario is selling computers and using Sports Illustrated to get its message out because it had the perfect demographic and the right audience. All of a sudden it will be denied that vehicle. However its competitor, IBM out of the U.S., will not be denied that vehicle. It will be able to use SI's North American circulation to deliver that message against me. In doing that it will have an unfair competitive advantage.
It is not the fault of the business in Ontario that is trying to sell computers. It is the fault of the government that is denying Sports Illustrated the chance to come into Canada and sell advertising to businesses like that. These products have a value to the people who use them. That is why they spend money on them.
We are denying that business a chance to use that vehicle to capture its own market. We may have a situation where IBM is coming in and is dominant in Canada because it has access to very cheap advertising that the business from somewhere in Ontario does not have. We are discriminating against the advertisers, the businesses that are employers of people and pay taxes to the Government of Canada. We denying them that chance. That is one reason the legislation is wrong.
The hon. minister talked about the fact that there are many Canadian magazines and people have access to them. What about the magazines we do not have access to because of the legislation? We do not know which ones they are. One of the theories of economics is that we never see the sometimes unintended, invisible results of economic policies.
What about those who cannot afford the subscription rates? What about those magazines? What about the ones that use the advertising revenue to get a wider distribution so they can charge more for their advertising? We will never hear about those magazines. They will never come here because they cannot support their subscription rates with more advertising rates. We are denied access to those. We will never know what we are missing because we will never see those magazines.
The same argument goes to the price that we pay for the ones that get here.
It is well known that prices are much higher in Canada for American or foreign magazines than they would be in their country of origin. I would argue that the reason for that is because the subscription price cannot be underwitten by the advertising revenues. So we again have a situation in which the consumers are taking it in the ear so that we can protect a certain privileged class, a group of people who publish magazines in this country and are lucky enough to enjoy the protection of the Canadian government.
In all these ways, consumers and advertisers are paying a high price for this government's policy. I point out again that in doing that we are denying people the chance to take their disposable income and spend it in other areas and cause the economy to grow and create jobs, the multiplier effect, et cetera. That is precisely how it works when there is free trade.
Before I talk about free trade in general I want to talk for a moment about the idea of an 80 per cent tax and about the principles the Canadian magazine industry has fought this issue on. To find out where those principles come from I think we have to go back to an earlier debate, to the debate about the GST.
There was an enlightening article in the Montreal Gazette on Monday, October 30, which I would like to quote. I think it puts the argument of the Canadian magazine industry into perspective and helps us to understand where they are coming from. This is from an article by William Watson, economic affairs editor of the Montreal Gazette :
Those who support the law, i.e., the Canadian magazine industry, argue the Americans have an unfair advantage. Their U.S. stories have already been written and therefore cost the split run virtually nothing. By contrast, editorial content in all Canadian magazines is all new for the Canadian market, so the playing field is uneven.
Well, the playing field for bananas and oranges is uneven too: tropical countries produce them much more cheaply than we do, but we do not insist Canadian fruit lovers buy Canadian-made oranges and bananas. If Canadian readers prefer cheaper U.S. editorial content to more expensive Canadian editorial content, why should Ottawa interfere with their choice?
When the GST was first being debated, the Canadian publishing industry ran an ad campaign, the gist of which was that other countries used to burn books, we just tax them. But now the very same industry is pushing an 80 per cent tax on one form of reading material.
Burning books is OK, I guess, so long as the books are American.
I think a very good argument is made in this article against the argument the Canadian magazine industry was using. They also make a very cogent argument for individual Canadians to be the protectors of culture. They are saying that individual Canadians should be the guardians of culture in this country.
It is the old cliché that beauty is in the eye of the beholder. While the Government of Canada may think something is not very good editorial comment or content and it may somehow be un-Canadian, other people may appreciate it. It enriches their lives, as reading always does. They find it fulfilling. That is why they read it.
By denying some of these magazines a chance to earn revenue by picking up advertisers in this country, we are in some cases denying them the chance to actually send their magazines into this country. I think this article absolutely explodes the argument of the Canadian magazine publishing industry, going back to the GST debate, about the GST being a form of book burning then, but when there is an 80 per cent tax on Sports Illustrated it is somehow different.
I really do think this argument is all about who should be the real guardians of culture in this country. I could go on about that in more detail, but I want to get on to the whole idea of free trade and something I talked about yesterday. It makes the point and so I will raise it again.
I remember from the free trade debate in 1988 all the articles and various newspaper, video, and TV clips that we saw about the effect free trade was going to have on the wine industry in Canada. I bet a lot of people remember that. I remember how people said it was going to devastate grape growers and the wine industry in Canada. There were all kinds of protests. We saw them in the Okanagan and also in southern Ontario.
At the end of the day, completely the opposite was the case. Not only did the wine industry thrive, it is now acknowledged around the world as one of the finest wine industries in the world. We have won all kinds of rewards as a result of the competition free trade brought in, which forced wine growers to become efficient and among the best in the world.
The same happens in every sector when we allow it to happen. It gets back to this whole argument about who decides what is right for the country. Should it be the government or vested interests? Should it be particular interests, which of course will never turn down protection from the government? They will in fact invite it. However, at the end of the day, what is best for consumers? Consumers end up with a cheaper product. They end up with more selection. They end up with the highest quality. Should that not be the standard we strive for? I think that is exactly what we get when we have free trade, even in the cultural industries.
Again I say that Canadians themselves should be the guardians and protectors of their own culture. They are more than capable of doing that. They are very sophisticated people. They can make those decisions for themselves. I want to point to some examples where I think the cultural industry is doing extremely well, where it does compete in the world extremely well.
Before I do that I want to touch on an issue the minister raised. He talked about general interest magazines being of interest to Canadians when they come from the United States but not necessarily the other way around. In other words, Americans may not be very interested in general interest magazines that come from Canada. I do not really disagree with that; I think that is probably true. We could make some arguments that if there are retired Canadian people down in the States there may be some interest in these general interest magazines. That is probably true, but that is really not the point.
I take the minister's point. However, what about all the specialty magazines? What about, for instance, a golf magazine? Why does a golf magazine have to come from the United States? Why cannot golf magazines come from Canada and be exported into the United States? For crying out loud, there is no difference in the game from one country to the other. In fact we have Canadian golfers on the professional golf tour. Why can it not work that way?
We had a witness before us who I guess was representing the interests of the Canadian magazine industry, but that person acknowledged that their magazine has about 30 per cent of their circulation into the United States. Obviously that is not something they would want to lose. It helps them to make a profit and strengthens their industry.
I would argue that if we want to strengthen the industries then we cannot rely on the tiny population, relatively speaking, that Canada has compared to the United States or the rest of the world. To further make the point, when we had a member of the Quebec magazine publishing industry before us he talked about the threat Quebec magazines faced if split run publishing was allowed in Canada. He talked about the possibility of all these magazines from other countries in the world coming in. He was not so worried about the U.S., of course, because it did not publish that often in French, but the big competitor was France. He talked specifically about France and actually Germany. He also talked about the Swedes, the Swiss, the Belgians being a threat. That struck me as very odd, because here are tiny countries, smaller in some cases than Canada, and they are a threat to Canada with their publishing industry. That struck me as extremely odd.
If you think about it, what they have realized and what they are doing is saying they cannot survive, probably the French juggernaut as well, by remaining insular, by looking inward. They have to take their product and market it to the rest of the world. They were trying to do that in Quebec and no doubt in other places around the world. That is how they were not only surviving but thriving.
To me that makes eminent sense. If you have a small market, the best way to turn the tables on the guys who are using the economy of scale on you is to turn around and use it back on them, to use your editorial comment and mass produce it to get into other countries around the world. In specialty magazines that can be done. We are seeing it to some degree through Canadian magazines already in the United States, but there is certainly a tremendous market to keep doing it or there is a tremendous market there and tremendous potential to keep expanding.
If we put impediments in place that prevent us from doing that, like the clause in the split run bill, Bill C-103, which does not allow Canadian magazines-this is unbelievable-that have a circulation in the United States that is less than it is in Canada to send back the editorial content via split run to Canada, then we are putting up an impediment that prevents our magazine industry from becoming bigger and from going out into these other countries and really making it more viable over the long run. I do not understand why in the world we are doing that.
We had people before the committee and one of the magazines doing that is Harrowsmith , a Canadian magazine that has a circulation in the United States. It is publishing out of New York and sending stuff back by split run to Canada and using the same content, but it is a Canadian magazine. Those people voluntarily said that if this is to be an argument used against this legislation, they will quit doing split run because at the end of the day it is in their best interest. That is not an argument, in my judgment. It is fine for them to say that; they are established down there now. But what about the guys who want to go down there and get established by having, for instance, a specialty magazine that appeals to Canadians and to Americans and to anybody who speaks the English language? Why are we standing in the way of that? That is the way to make our industry viable.
From what I have seen in the book publishing industry, we have some of the best writers in the world. We can produce editorial content that is better than anybody else's in the world. We have proven that before. You look at the book publishing industry and at how widely read Canadian books are around the world and you know we are producers of great writers. We can do that. The same argument applies when we are talking about French writers. We could produce some of the best editorial content in the world, but we are being denied the right to do that, partially through this split run clause in the legislation.
It is more than that. It is the attitude. We are saying do not let the Americans in and we will not go in there. It is kind of a saw-off. It is crazy when we have so much to share with the rest of the world, the best artists and writers and creators of all kinds in this country. It is absolutely crazy that we are doing that.
Yesterday I mentioned this, but I will bring up again the Canadian Association of Broadcasters convention I attended on the weekend. The minister was there as well and spoke to the convention. What I want to talk about is how Canadian broadcasters have really gone out and made a success of themselves around the world because they have not been afraid to use the economies of scale, taking Canadian product and using it across the world.
One of the best examples of this is CanWest Global of Winnipeg which is huge in New Zealand and in Australia. Another very good example is Power Corp. which is now very big in Europe. I understand it is the biggest broadcaster in Europe and is doing extremely well. Another example is Electrohome Ltd. and there are others.
These companies take the programming they produce here and to take full advantage of the economies of scale they have marketed around the world. They have done extremely well. It means jobs for Canadian film makers, jobs for Canadian actors, jobs for Canadian screenwriters. Already we have the beginnings of a cultural industry which is doing extremely well in so far as it is allowed to compete freely in the world.
We should not be looking inward. I go back to what I started with, the real guardians of Canadian culture cannot be the government. It cannot make those determinations. There are too many different opinions out there. The real guardians of Canadian culture have to be individual people. People are very intelligent. They can make these determinations. They do not need the government dragging them around by the nose telling them that this is worthy of protection. That is crazy. We are too grown up for that.
Another issue needs to be raised and that is the whole issue of what may happen if we become too protectionist of our markets. It was not very long ago-the minister was involved in this-that we ran into precisely that type of problem when we decided to kick CMT out of Canada. CMT was Country Music Television, a video network, which had been in Canada for several years. Then a Canadian service came on and CMT was thrown out. It caused a rift between us and the Americans.
We are an exporting country. I hate to see that market close down for Canadian producers of culture because we make so much money from it. It enables those people to survive. What we saw in the CMT incident was the possibility that we were going to have the market closed off to us for our cultural exports. That is extremely dangerous. A good example of its importance is to look at how fast the private sector cultural industries have grown in the last few years.
As the subsidies from government diminish-the minister will certainly acknowledge they have diminished over the years-the private sector cultural industries have boomed. First, they need neither cultural protection nor subsidization. Second, they have been successful and are continuing to be successful at exporting their products to the United States and other countries around the world which has certainly meant substantial growth in that sector. Returns were around $16 billion in 1993 and were up to $22 billion in 1994, about 3.7 per cent of the GDP. This sector is actually growing very quickly which I believe bodes well. I will discuss this in more detail shortly.
Protectionism is a very dangerous route to go if we depend on other markets to make our cultural industries profitable. If they are closed down we are in big trouble.
I want to talk for a moment about what I see as the way to make cultural industries prosper and really do well in this country. I touched on the fact that private sector cultural industries are growing like crazy due to a couple of reasons. One of the reasons is that as the population ages people are spending more of their money on cultural products like movies, going to the theatre, books, magazines and so on. In a speech in the House not too long ago, the minister pointed out that as disposable income has increased over the years we have seen the Canadian magazine
industry do extremely well. Having more disposable income is the real key.
That brings us back to the whole debate about the deficit, the debt and taxes. I hate to mention it again. I mention it every time I speak but it is a huge cloud that hangs over our heads. The debt in this country is $560 billion. Yesterday we found out that 34 cents, or one-third, of every tax dollar goes toward interest on the debt. That is an unbelievable amount of money.
Can members imagine if we did not have to pay that, if we could keep it in our pockets, how much more people could purchase? Cultural industries would absolutely boom. We would not even be having this discussion about protecting the nation's cultural industries. They would absolutely explode.
In my judgment, we should not be wasting all this bureaucracy and people's valuable time to come up with more regulation and more protection. What we should be doing is beating down the debt, beating down the deficit, getting to a point where we can keep more money in our pockets. Canadians will go out and support magazines, not because they are Canadian but because they speak to us about things we are interested in.
As I said in committee, as long as politicians are wasting money in Ottawa and as long as there is crime in the streets, people are going to want to know what is going on in Ottawa, in their government and in their country.
The best way to do that is to find out from the people who publish Canadian magazines. Canadian magazines already have a huge head start. They already have the history, and the people running them who understand the country. That is a huge advantage over anything that comes in from outside the country.
If they have disposable income, Canadians will make those decisions themselves. Those people are the true protectors of Canadian culture. They will make those decisions for themselves.
Canadians over the years have demonstrated time and time again, better than government, that they can make decisions about important issues far better than politicians in Ottawa can, far better than the bureaucrats can, far better even than the provincial governments and even municipal governments can. I argue that those two levels of government make better decisions than the federal government. Ultimately people have displayed that they are more than mature enough to make excellent decisions on behalf of themselves, their communities and their families.
What this whole debate has been about, if one just sort of looks past all the technical issues and the details, is who should decide what is best for me. Should it be the government or should it be me? My colleagues and I would argue and a whole bunch of Canadians would argue that they should make the decision for themselves. Let us get away from the idea that the government knows best because people do not buy into that any more. Let us get away from the idea that one man or a cabinet can decide for 30 million people and all the different groups that make up those 30 million what is culture, what is art.
It is impossible. It is crazy. We have a chance to roll that tide back by voting against this legislation. I encourage all members to take a close look at the principles behind this legislation and to ask themselves who the guardians should be of Canadian culture. Should it be the Government of Canada, bureaucracies or should it be people themselves?
At the end of the day in their heart of hearts, they will admit that the people are more than capable of making those decisions.
