Stephen Harper has found the ideal formula to win back disenchanted voters: a consumer manifesto! He will bash the telcos, liberate us from our bloodsucking cable carriers and give us equal pricing with the United States. Forget about those cross-border runs. Now stuff will be just as cheap in Canada.
Well, not all stuff. Not milk, chicken, eggs or cheese. Maybe not even your drugs. Mr. Harper has a new trade deal in the works, the biggest since NAFTA. That’s mostly a good thing, but in order to secure it, he has traded off your interests to two of the most powerful lobby groups in Canada: dairy farmers and Big Pharma. He pledges that he wants to fight the big corporate interests rigging the system against the little guy. But sometimes, his mission is to defend the status quo – or rig it even more.
The deal in question, CETA (Comprehensive Economic and Trade Agreement), is all but done. It gives Canada and the EU unprecedented access to each other’s markets. As always, the biggest sticking points were political. The stickiest of all was the sacred status of Canadian dairy farmers, who are the most pampered and protected folks on Earth. Sadly, their sacred status remains untouched. They are screaming bloody murder because we have agreed to let in a tiny bit more cheese from Europe. Do not be fooled. Their protections are essentially intact.
Yet the Europeans do appear to have extracted costly concessions on drug patents – changes that will enrich international Big Pharma even further and significantly drive up our health-care costs. So now we’ll have overpriced milk and cheese, and overpriced pills.
Mr. Harper hopes you won’t notice these things, and he’s probably right. Roaming charges and cable bills are easy to understand; everybody thinks they’re high and feels ripped off. But scarcely anybody understands the ins and outs of supply management or drug patent protection, which are so complicated and arcane that they make your head hurt. As one former lobbyist puts it, “Politicians win when the issues are very complex.”
How did the dairy farmers get to be so powerful? It goes back 45 years, to when federal politicians were desperate to win the rural vote – especially in Quebec. So they gave the farmers the power to decide how much milk should be produced and what price it should be. Today, a vast bureaucracy exists to protect the status quo. Canada’s 12,500 dairy farmers, who make up 0.04 per cent of the population, own dairy quota worth roughly $30-billion. But no politician will criticize the system, because anyone who raises the issue would be committing political suicide.
The cost of all this lunacy is hardest on the least well off, who have to buy milk, chicken and cheese like the rest of us. Maybe you think those things don’t cost much, but they all add up. Supply management, which keeps cheese prices high, is a big reason why a Costco pizza can cost $10 in the United States and $13.95 in Canada. It’s why you can buy a pound of cheese at a U.S. Wal-Mart for $8.50 and pay three times more in Canada. And because poor people pay the same premium as everybody else, the hidden dairy tax is the most regressive form of tax there is.
Then there are the brand-name pharmaceutical companies. How did they get to be so powerful? Simple: They are among the biggest lobbyists in the world.
The stakes are huge. Canada’s total prescription drug bill was $27.7-billion in 2012. They want to extend patent protection on their brands for as long as possible, because as soon as a drug goes off-patent, the generic drugmakers jump in and sell it for a quarter of the price. When Lipitor went off-patent a couple of years ago, the Canadian health-care system started saving a billion dollars a year on that drug alone.
In Canada, the brand-name pharmaceutical firms were able to negotiate 20-year patent protection back in the 1990s. In exchange, they promised to do basic research here, especially in Quebec. Critics say they never did deliver. Nonetheless, Big Pharma urged the EU to request a three-year patent extension. It will be interesting to find out how much Mr. Harper has given them.
I don’t agree with Maude Barlow about much, but she’s right about drug patents. Canadian consumers are getting sold down the river. So be wary. For every break the government is promising you today, it will take another one away tomorrow.