Canadian Culture? Whatever It Is, They Want to Preserve It

When home electronics dealer Mirek Matuszewski sells a satellite television system to a customer, he hands out a little legal advice to go with it.

There’s nothing wrong with owning one of the pizza-sized dishes in Canada, but the minute it starts receiving U.S. programming via satellite, the owner is in breach of Canadian law. There are as many as 300,000 such outlaws in Canada today, watching television beamed from such U.S.-operated services as DirecTV and Echostar. To avoid detection, they pay their bills via post office boxes and other dummy addresses in the United States.

The prospect of Mounties prowling the suburbs in search of telltale dishes on rooftops is too ludicrous for most Canadians to seriously contemplate, and authorities have done little to enforce the law, which is intended to protect Canadian-owned satellite television broadcasters.

The satellite television market here has become an example of how technology, globalization, falling trade barriers and consumer demand are eroding the policies that Canada traditionally has used to nurture its performers, producers, artists, writers and composers beneath the giant shadow cast by Hollywood.

That erosion has triggered a national soul-searching and prompted the country’s deputy prime minister, Sheila Copps, to rumble last month about a trade war against U.S. “domination of the world culture community.”

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The cultural impulses of the United States and Canada, two countries that share the same land mass, a common language and many of the same values, have long been intertwined. Movie star Mary Pickford may have been known as America’s sweetheart, but she was born in Canada. Copps’ comments, however, reflect Canadians’ acute awareness that they are very much the junior partner in this relationship, holding only about 10% of the population and wealth of the U.S.

Few here expect the government to follow up on Copps’ threat to “play hardball” with Hollywood, if for no other reason than that Canada would probably lose any culture war with the United States. Prime Minister Jean Chretien has been notably silent on the issue since Copps spoke out.

In the meantime, the proliferation of illegal satellite television reception in Canada underscores the government’s frustration.

Virtually all of the programming satellite users receive originates in the U.S., circumventing laws that require conventional broadcasters to devote 60% of their broadcasting time to Canadian-originated programs. And, unless they augment their satellite coverage with cable service, many users receive no local programming.

Canadian satellite services are bound by government regulation to include a strong representation of Canadian-made programs. So far only one company is open for business, and it offers fewer channels than the U.S. services. Electronics dealer Matuszewski doesn’t expect many buyers to go Canadian.

Unlike some of his competitors, Matuszewski, a former satellite engineer, does not set up American billing addresses for customers who buy a U.S. dish. But he does advise them of the latest court decisions on the issue--and of the government’s hesitation to hunt down violators.

“The client is the one who pays my bills; he’s the one I’m serving, not some bureaucrat in Ottawa,” he said.

Still, Matuszewski said he finds the entire exercise silly and distasteful. It reminds him, he said, of his childhood in Communist Poland, where he stood lookout while his father engaged in the forbidden practice of listening to Voice of America on the radio.

Many here would find that analogy objectionable. Canadians, in fact, are probably exposed to the widest range of entertainment and literature of anyone in the English-speaking world.

Booksellers offer nearly the entire output of the British and U.S. publishing industries, along with that of Canada. Cable television subscribers in Toronto can receive 60-plus channels that include all four major American networks; a sampling of U.S. cable channels; three Canadian networks that carry varying amounts of home-grown programming; and a variety of specialty channels that air British, French, Australian and other foreign shows.

Still, the U.S. presence is dominant: more than 90% of the movies shown, more than 75% of the newsstand magazines sold and an estimated 50% of the music heard on the radio.

That creates a “maelstrom of competition” for Canadian products, in the words of Dennis Browne, director of the Center for Trade Policy and Law at Carlton University in Ottawa.

The government’s response has been to prop up domestic industries and support Canadian artists with a combination of subsidies, grants, tax credits and regulations that set minimum broadcast standards for “Canadian content” and limit the intrusion of foreign products.

But in the last few years, government cutbacks have reduced the amount of money available to subsidize artists and support such institutions as the Canadian Broadcasting Corp., the state-owned television and radio network.

Shifting technology and world trade rules are undercutting other barriers. In 1994, Sports Illustrated magazine evaded a long-standing Canadian law barring the import of most Canadian editions of U.S. magazines by beaming the content of its new Canadian edition over the border by satellite. When Canada retaliated with a new law seeking to tax the magazine out of existence, the U.S. responded with a successful appeal to the World Trade Organization.

The globalization of the entertainment industry has even obscured the definition of what constitutes a Canadian performer.

Take country singer Shania Twain, who was born in Timmons, Ontario, north of Toronto, but who now lives in upstate New York, pays U.S. taxes and records in Nashville. Twain’s recordings are considered Canadian music by most government and industry standards here, but exactly what is intrinsically Canadian about her rendition of “Whose Bed Have Your Boots Been Under?” remains a mystery.

All of this shifting ground has prompted the current rethinking of government policy on the arts, a debate that carries implications not only for Canadians, but also for the U.S. entertainment industry, which counts Canada as its fifth-largest market.

Among policy proposals now under discussion:

* A government-imposed limit on the amount Canadian television broadcasters could pay to buy U.S. programs, supposedly to free more money for Canadian productions.

* Regulatory changes that would permit greater substitution of Canadian TV broadcasts for U.S. broadcasts on cable systems. For example, broadcasters here would like to black out NBC’s 1998 Winter Olympics telecast from Canadian cable systems on grounds that it would cut into the audience for the Canadian network coverage.

* Redefining “Canadian content” rules that determine which productions are eligible for tax credits, subsidies and other government assistance and qualify to meet broadcast quotas.

* Copps has launched talks with France to see if the two countries can make common cause against the “Hollywood juggernaut,” and would like to expand the negotiations to other European nations.

Such questions are being raised even as Canadians are having unparalleled success in the world entertainment market. Singers Twain, Alanis Morissette and Celine Dion are top sellers in the United States, and Dion, who also records in French, is equally popular in France. Jim Carrey is one of the world’s highest-paid movie stars. Canada is the second-largest exporter of television programming after the United States. Disney is so impressed with Canadian animators that it’s setting up shop in Toronto and Vancouver.

Indeed, some here fear that any barriers to imports by Hollywood or other foreign producers could backfire on the Canadian industry.

“Why should we subject some of our most successful export industries to retaliation just to subsidize our losers?” asks Stephen Harper, an economist with the National Citizens’ Coalition, a conservative public advocacy group based in Toronto.

Trade Minister Art Eggleton seemed to be making a similar point in a Jan. 27 speech in Toronto that helped ignite the current debate.

“Canada’s artists, writers and performers have always known that the domestic market for their work is small, which is one reason they have fought to secure their fair share of it,” he said. “But their ability to survive in the long term will depend on their ability to find an international audience.”

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Noting that most of Canada’s cultural policies are 30 years old, Eggleton asked whether “our cultural interests are best served by the blunt instruments of limits on foreign investment and control of Canadian culture.”

Eggleton immediately was accused of selling out to the Americans.

“We’re inundated with American cultural product--I mean, you can buy USA Today from Toronto street boxes,” said Toronto music executive Alexander Mair, a self-described “raving nationalist.”

“I don’t think the polices we have should be etched in stone, but I also don’t feel like we ought to throw out everything.”

But Mair conceded that as government support for the arts shrinks, infighting has broken out within the industry over how to divide what’s left.

There is growing resentment over the use of tax credits and other incentives for television productions intended mainly for the U.S. and other foreign markets and that disguise their Canadian locations to appear American. Critics argue that those tax breaks drain public money from programs aimed primarily at a Canadian audience.

But Robert Lantos, chairman of Toronto-based Alliance Communications, argues that the tax breaks allow Canadian producers to “level the field” in their competition with the Hollywood studios.

What ultimately will decide the issue for Canada, economist Harper says, is consumer demand, and that is running in the direction of freer trade: “Canadians are voting with their channel changers, their satellite dishes and their pocketbooks.”