Some broadcasters are more equal than others

By Jonathon Gatehouse and Philippe Gohier - Friday, March 20, 2009 at 12:38 AM - 32 Comments

Good things come to those who wait. At least that’s Canwest Global Communications’ perspective on Ottawa’s new-found willingness to consider assistance for Canada’s beleaguered private television networks.

On Wednesday, Heritage Minister James Moore confirmed that the Harper government is looking at loosening broadcast regulations and changing tax rules to help the media giant stave off bankruptcy. But the spin from the company’s Winnipeg HQ is that this is less a bailout than a righting of historic wrongs.

“It’s a sign that the government is hearing the growing chorus of voices—consumer groups, organized labour, the Opposition, special interest groups—who are all saying that the way consumer dollars are collected for viewing cable are not being adequately and fairly sent around to everybody,” says John Douglas, Canwest’s vice-president public affairs. “Our position on this is the same as it has been since 1971.”

Canwest, along with CTV and Quebecor, owners of the private French TVA network, have long been asking the CRTC to treat their conventional channels more like specialty networks, which receive a share of cable subscribers’ monthly bills known as carriage fees. Cable providers like Rogers, which owns Maclean’s, are opposed to the idea, claiming the system could inflate customers’ bills by as much as $10 a month. The conventional broadcasters say the estimated $300 million a year fee-for-carriage would generate is essential to their survival. The CRTC categorically rejected that argument last fall, saying the networks failed to prove they really needed the higher revenues. But as the global economic meltdown has taken its toll on advertising, broadcasters are finding that Ottawa is a lot more receptive to being—rather than crying—poor. “We have the CRTC admitting now that the model is broken,” says Douglas. “And anything that would be contemplated by the federal government, I’m assuming, would be in recognition that the state of the industry is what we said it was two years ago.”

But deep cuts to local news coverage by all the private networks, moves by Canwest to sell its five E! channels and threats by both CTV and CanWest to walk away from unprofitable smaller markets, are also clearly forcing government’s hand. And the message that immediate help is needed has been taken directly to 24 Sussex Drive. Both CanWest CEO Leonard Asper and Quebecor’s Pierre-Karl Péladeau, have personally met with Prime Minister Stephen Harper on behalf of their companies in recent weeks. The federal lobbyist database also shows meetings with Minister Moore, senior CRTC executives, and former industry minister Jim Prentice. Douglas would not comment on specific meetings, or reports that Canwest has engaged the lobbying services of Ken Boessenkool, a former senior Harper adviser, but said the company has always kept Ottawa in the loop about its concerns: “The amount of dialogue we’ve had is no different that what we’ve had over the previous years.”

If the government’s aim in saving Canwest is to preserve local programming, easing content restrictions is a curious way to go about it, argues Canada’s largest media union. In a statement released Thursday, the Communnications, Energy and Paperworkers Union of Canada says the federal government should be wary of bailing out from under the weight of its “bad business decisions.” In fact, if the CRTC does eventually allow the broadcasters’ to collect carriage fees, the government agency should use the opportunity to tie the extra funds to “new, original news and information programming,” says Peter Murdoch, the union’s vice-president, media. “Local programming is not the cause of Canwest’s debt problems, nor should it be made its victim.”

The prospect of doling out government aid to Canwest also raises the question of just what the government should be doing to help other types of media struggling in these uncertain economic times. Canwest, for example, also owns 39 daily and community newspapers in Canada. And while they don’t appear to be lobbying Ottawa for assistance on that front (the lobbying database lists “broadcasting” as the subject of all recent meetings), given the industry’s current difficulties south of the border, it is not inconceivable that Canada’s papers will also soon find themselves at a crossroads.

David Black, president and CEO of Black Press, which operates more than 150 community and daily papers in Canada and the U.S., declined to comment on any possible assistance for his competitor (“You don’t want to go there”) but said there is a case to be made for Ottawa helping print too. “I don’t believe that government will work very well without daily newspapers,” he says. “If the opposition raises its voice in the House and no one is there to report it, what good does that do?” Given the current crisis, journalistic ethics may have to take a back seat to economic realities, says Black. “You want to be able to run editorially without fear or favour, but on the other hand we’ve got a problem.”

The one place where the Harper government is emphatically drawing the line, however, is public broadcasting. Moore has already said Ottawa will not provide more money to the CBC after the network disclosed that it is facing an estimated $100 million hole in its budget due to shrinking ad revenue. Ditto to requests for an advance on next year’s funding or a bridge loan. “The only way we’ll get the financial flexibility we had asked for,” says CBC spokesperson Marco Dubé, “is to sell some of our assets.” For his part, the Heritage minister suggested earlier this week that the CBC would have to cut between 600 and 1,200 jobs to balance its books.

Whether the public and private broadcasters—long bitter enemies—will find common cause in these troubled times, remains to be seen. One of the issues that Leonard Asper is registered to lobby on is the future mandate of the CBC. But at this point, CanWest has no position of whether its rival deserves some assistance too. “That’s not for us to comment on,” says Douglas. “We’re in a position to comment on our situation and the realities of our network.”

Is your industry a) strategic, b) high-tech, c) no-hope, but located in swing ridings an hour's drive from a major media centre, d) whatever will get me a grant

By Andrew Coyne - Thursday, December 18, 2008 at 7:54 PM - 65 Comments

But, you ask, where’s my stimulus? Where’s my bailout? 

Stop it. I hate it when you use your Mr. Whiney voice. And in any event, it’s a perfectly simple procedure. Just fill out this form. And send it along to the good people at Stimulus Canada.

Visions of sugar-plums

By Andrew Coyne - Thursday, December 18, 2008 at 12:17 PM - 7 Comments

“I’m sorry for your situation, but it is difficult to justify giving trillions of US taxpayer dollars to a private company that is outmoded, headquartered offshore, and, frankly, imaginary.”

– Latest bailout applicant faces skeptical reaction in Congress.

(Swiped from one of Wells’s commenters.)

Stimulus, explained

By Andrew Coyne - Wednesday, December 17, 2008 at 3:38 PM - 10 Comments

In The Know: Should The Government Stop Dumping Money Into A Giant Hole?

Stimulated yet?

By Andrew Coyne - Tuesday, December 16, 2008 at 4:30 PM - 44 Comments

So the Bush presidency draws to a close, with a four-month barrage of economic recovery plans issuing forth from various parts of the US government, most of them improvised in great haste with little thought for their long-term consequences. Politico adds up the bill:

It’s a package of about $8.7 trillion dollars’ worth of potential taxpayer commitments for loans, guarantees and other bailout goodies for businesses and distressed homeowners.

Amid the tissue paper:

• More than $1.5 trillion in Federal Deposit Insurance Corp. loan guarantees, including a $139 billion assist to the lending arm of General Electric Corp.

• $1.8 trillion in cash, tax breaks and loan guarantees doled out from the Treasury Department to taxpayers, financial institutions and credit companies.

• $300 billion for homeowners from the Federal Housing Authority.

• $25 billion in assistance for auto companies from a program overseen by the Energy Department, which is separate from the bailout proposal that tanked last week in the Senate.

• And $5 trillion worth of new money, loan guarantees and loosened lending requirements from the Federal Reserve Bank.

According to Bianco Research President James Bianco, who crunched these numbers, that amounts to more government aid and assistance than nine other historic bailouts and big government outlays combined.

The New Deal, for instance, cost an estimated $32 billion in its day, which would be about $500 billion in today’s dollars. The Marshall Plan cost about $12.7 billion, which is the equivalent of a paltry $115.3 billion. The Louisiana Purchase? The French got $15 million, which would be worth about $217 billion today. 

If you take those three items, add in the adjusted costs of the Race to the Moon, the savings and loan crisis, the Korean War, the Iraq war, the Vietnam War and assistance for NASA, you still get to just $3.92 trillion — not even half of the taxpayers’ exposure today, according to Bianco. 

If that weren’t enough to make you want to upgrade your holiday gift list, it’s useful to remember that Congress isn’t done and President-elect Barack Obama’s team hasn’t even started.

From all, to all

By Andrew Coyne - Monday, December 15, 2008 at 2:43 AM - 59 Comments

The precedent’s hardly been set, and already…

Tories set to add forestry, mining to bailout list

After pledging more than $3-billion to rescue the auto sector, the Harper government is now poised to offer similar aid to the struggling mining and forestry industries in next month’s budget.

Industry Minister Tony Clement said Sunday on CTV’s Question Period that a number of industries are “under distress” and “other industrial sectors, other extraction sectors are on the table for our budget coming out on January 27th…”

In the Throne Speech, the Conservative government had pledged relief for automotive and aerospace sectors but nothing was proposed for the fisheries, mining and forestry industries.

NDP Leader Jack Layton credited the creation of the coalition between his party and the Liberals that is supported by the Bloc Québécois with forcing the government to act swiftly.

“It looks like the government’s finally changing direction,” Mr. Layton said on Question Period. “We’ve been saying for quite a number of months and during the election that we’ve needed strategies for these key sectors that were in trouble, and I think the Prime Minister was either in denial or just ideologically felt governments shouldn’t be helping out.”

Well thank goodness that’s over with — out with ideology, in with practicality! And what could be more practical, more pragmatic, more … Canadian, than to have everyone pitch in to bail each other out? The forestry sector bails out the auto industry. Mining bails out forestry. Aerospace bails out mining, fisheries bail out aerospace — and the auto industry bails out the fisheries! What each pays in taxes it gets back in subsidies. And vice versa.

But why not? There is no budget constraint. Deficits are no longer to be avoided. They’re “essential.” Spending is no longer to be controlled. It’s “stimulus.” The NDP are no longer socialists. They’re the Conservatives.

IN OTHER PRAGMATIC NEWS: Ottawa eyes shipbuilding as economic stimulus  

AIG – A question for our readers

By Steve Maich - Wednesday, September 17, 2008 at 11:58 AM - 17 Comments

Last night’s shocking bail out of AIG hasn’t done much to calm the fears roiling through the markets this morning. It has, however, got me to thinking.

Clearly Paulson felt he was in a no-win situation, and made a decision based on the cold calculus of pragmatism. He ahd to decide which was the lesss terrible of two terrible options:

Continue…