The government’s proposed law, which would require streaming services and social media sites to show Canadians a minimum amount of “Canadian content,” is symbolic of a much larger problem.
Back in February, I wrote about a legal challenge that made its way up to the Supreme Court involving a 1996 law called Section 230, which effectively paved the way for the Internet we know today by affording tech platforms immunity from liability for content posted by third parties. It’s a fun read involving the Wolf of Wall Street, Google, ISIS, and an adorable old tech-illiterate lawyer, and you should check it out (though I might be biased).
Should you not be so inclined to support independent writing—instead preferring to spend that time scrolling through TikTok (as an aside, if you want to truly lose faith in humanity, check out Wikipedia’s “list of most-liked TikTok videos” to see what illuminating content the masses are consuming these days)—the basic takeaways of that article were:
- The laissez-faire approach taken by Congress back in the 90s to shield Internet platforms from potentially crippling levels of litigation is directly responsible for fostering much of the technological progress we’ve experienced in subsequent decades.
- With the passage of time and the progression of technology, gaps and unintended consequences have increasingly presented themselves in Section 230 and the general regulatory landscape of the Internet. However, it’s for Congress, in tandem with the private sector, to address those gaps and unintended consequences, not the Supreme Court.
- Ultimately, Congress did the right thing by not over-regulating the market too early. Section 230 allowed things to play out, so to speak, by immunizing Internet service providers—enabling them to innovate, iterate and scale without the fear of being sued or shut down for things third parties said or did on their platforms. As Sen. Ron Wyden, who co-sponsored the amendment that added Section 230 into the Communications Decency Act, said, “The purpose of Section 230 was to encourage the growth of an industry that barely existed in 1996 – the internet – by making sure that online companies wouldn’t be sued out of existence for the actions of their users.” Now that the Internet has matured (metaphorically, at least), Congress should re-evaluate the regulatory landscape to see where additional regulatory safeguards are appropriate.
The third point is crucial. To be sure, this is a difficult, if not impossible, line to toe. As a legislator, you want to be proactive, not reactive. But if you act too fast and forcefully, you risk hindering—or even crushing—nascent industries and markets. Your goal is to craft value-accretive rules of the game, but if you come up with the wrong rules (or even the right rules at the wrong time), you risk destroying value.
In hindsight, Section 230 was fairly unique. For one, it was unique for Congress to have simply passed legislation (an uncommon occurrence these days). It was also unique for Congress to have passed legislation quickly—while the Internet was still nascent. But it was even uniquer(?) for Congress to have quickly passed legislation that let the market breathe, instead of clamping down on it (the latter typically being the approach taken by overzealous politicians wanting to impose whatever power they have). In that vein, Section 230 was also uniquely American. As the bill itself presciently summarized all the way back in 1996:
The legislation promotes the continued development of the Internet and other interactive computer services, and preserves the vibrant and competitive free market that presently exists for the Internet and other interactive computer services, unfettered by Federal or State regulation.
It makes sense, then, that the US would go on to drive much of the Internet’s coming of age (for better or worse).
The reason I’ve decided to take you on this trip down memory lane is to emphasize how good and timely legislation—and (sometimes just as importantly) the absence of overly-burdensome and untimely regulation—can have massive ramifications. In 1996, Congress saw an opportunity to be a leader in this new thing called the Internet, so it passed Section 230 to let the private sector go for it.
A prime example of the counterfactual can be found north of the American border, in the friendly yet frigid nation of Canada. The Canadians are a consensus-seeking bunch. Sure, they don’t agree on everything, but they’re much less polarized than their neighbors to the south. This may seem obvious, but it leads to some less obvious results—namely, Canadians are far more trusting of their government than Americans are. As a result, Canadians are much more willing to allow their government to enact laws that have material impacts on their rights and responsibilities as citizens.
One example is Canada’s Broadcasting Act, which was first enacted in 1932 during the Golden Age of radio but has been amended several times since, most recently in 1991. The Broadcasting Act established a regulatory body called the Canadian Radio-television and Telecommunications Commission (CRTC) and tasked it with overseeing—you guessed it—radio and TV. And, as radio and TV grew in popularity between 1932 and 1991, so did the CRTC’s powers under the Broadcasting Act with each new amendment of the Act.
By 1968, at the peak of Hollywood’s dominance in the cultural zeitgeist, the Government of Canada determined that it was time to take a more forceful approach to fostering its own pop culture by mandating the CRTC to set content quotas on TV and radio for “Canadian content” (colloquially called “CanCon”). While it might seem strange to most Americans, Canadians born in the ‘60s or later give hardly any thought to the fact that at least 35% of all songs played on the radio and of all programming aired on TV annually must be CanCon (in fact, up until 2015, at least 55% of all TV programming aired annually had to be CanCon).
The law itself is a mess. For one, it’s incredibly hard to police, given that there are a host of exceptions and differing standards for things like “community and campus radio” and “native radio.” More importantly, what constitutes CanCon is, well, not so intuitive. The CRTC outlines a set of ridiculously complex multi-factor, point-based tests to determine what TV and radio content qualifies as CanCon, based on things like if the “producer [is] Canadian and is responsible for monitoring and making decisions pertaining to the program” or that “at least one of either the director or screenwriter positions and at least one of the two lead performers must be Canadian.” This leads to plainly wrong outcomes:
Most Canadians would probably think the objective of the Cancon policy is to create more productions that tell Canadian stories–stories written by Canadian writers, stories set in Canada, stories featuring Canadian actors, stories that reflect Canadian realities, and so on. But they would be wrong […] The current poster child for this anomaly is the Disney animated feature Turning Red, set in Toronto, featuring the story of a young Chinese-Canadian girl growing up in the city, and starring Canadian actor Sandra Oh. It may look and feel Canadian, but it does not qualify as Cancon because it was made by Disney, a non-Canadian entity. Disney financed it and holds the copyright. Nor did the adaptation of [Canadian] Margaret Atwood’s Handmaid’s Tale (filmed in Cambridge, Ont.) or Amazon Prime’s recent series on the Toronto Maple Leafs qualify.
This is because there are complex financial, management, creative and intellectual property formulas that govern what is considered Canadian content. On the other hand, some obscure co-production with another country that has no distinguishable Canadian features at all can qualify.
The same is true in the radio space. Why Canadian artists need what effectively amounts to an affirmative action policy for Canadian musicians is unclear, given that the likes of Bryan Adams, Céline Dion, Shania Twain, Sarah McLachlan, Alanis Morissette, Rush, Drake, Shawn Mendes, the Weeknd and Justin Bieber have dominated airwaves around the world for decades. It becomes utterly baffling, though, when you realize that each one of those artists belongs to American record labels, which take home the majority of the artists’ radio proceeds.
“So what?” you might say. “So the law is a bust. Who watches TV or listens to the radio anymore, anyways?” And you would be right. But, before you pat yourself on the back:
A Liberal government bill that would require online streaming services to contribute to Canadian content is one step closer to passing after the House of Commons approved most of the Senate’s amendments to the proposed legislation.
If passed, Bill C-11 would update broadcasting rules to include online streaming and require tech giants such as YouTube, Netflix and Spotify to make Canadian content available to users in Canada—or face steep penalties.
On Thursday evening, the House agreed to adopt Senate amendments that reinforce the promotion of Indigenous languages and Black content creators, and seek to ensure that funds collected from tech giants go toward promoting diversity, equity and inclusion.
That’s right, as soon as this month, the Canadian Government will likely succeed in extending these CanCon regulations to all social media and streaming companies—forcing those companies to modulate content to ensure that the requisite amount of CanCon is getting to Canadian users. Bill C-11 is as sweeping and vague as the original Broadcasting Act, and would cover everything from videos on TikTok and YouTube to music and podcasts on Spotify and Apple Music (if that’s still a thing).
If enacted, Bill C-11, which would reinvigorate what has largely become an obsolete, ineffectual law, would surely send shockwaves through the tech industry… were it not for the fact that Canada’s population of roughly 38 million makes up a tiny fraction of these companies’ user bases. In fact, even though the impacted companies will almost certainly make a good faith effort to comply by providing Canadians with a diluted product, it wouldn’t be all that surprising if Spotify—a company with nearly 500 million monthly active users—decided that the cost of doing business in Canada outweighed the benefits of complying with this law and simply pulled out of the country altogether.
Now, you might say, “Fine. The original law was a practical failure, but surely the Canadian Government will get it right this time around, when it applies it to the Internet.”
Well, in addition to the same old flaws that were present in the TV and radio CanCon regulations, from a practical perspective, the bill might actually hurt Canadian content creators and consumers. As YouTube’s CEO, Neal Mohan, explained, the bill would mean “that when viewers come to the YouTube homepage, they’re served content that a Canadian Government regulator has prioritized, rather than content they are interested in.” That’s because user interaction with content pushes that content up or down based on user engagement. According to Mohan, “globally, Canadian creators will have a harder time breaking through and connecting with the niche audiences who would actually love their content.” Mohan also noted that more than 90% of the “watch time” on content produced by Canadian YouTubers comes from outside Canada. In fact, Justin Bieber’s own mother recently said that she doesn’t think her son would have been discovered on YouTube had Bill C-11 existed at the time (I bet you didn’t think I’d find a way to bring the Biebs’ mother into this).
But, even beyond the practical ramifications, the proposed regulations are sure to fail for two, much more profound and pervasive reasons—reasons that actually drive many of Canada’s worst laws.
The first reason stems from the original purpose of the Broadcasting Act, as described in the Act itself: “[The Act’s purpose is to] contribute to the development of Canadian culture and . . . reflect the attitudes, opinions, ideas, values and artistic creativity of Canadians.” On first glance, you may think that makes sense—the Canadian Government would naturally want to promote CanCon to develop Canadian culture and ensure that Canadian culture is sufficiently displayed throughout Canada. But beyond all of the practical criticisms of why the actual law fails to do that, there’s a more basic problem with this approach: no one really knows what “Canadian culture” is. Don’t believe me? According to one revered former Canadian politician:
Canadian culture is the product of the mixing of different cultures and traditions, one as rich as the other. Our distinctive features are enriched by the contribution of Aboriginal cultures and other cultural customs that have gradually been added. Our way of life is Western, North American, but at the same time Aboriginal, Ukrainian, Pakistani, Senegalese, Acadian, Irish, and so forth…
It’s hard to promote national content when your national motto is effectively, “We are the United Nations.” See, Canadians have long since defined themselves by being not just one thing, but by being everything (everywhere all at once…sorry…). Indeed, Canadians have committed so much to this notion of an all-encompassing identity that some Canadians even profess to have transcended the very notion of a national identity. If you think that’s a fringe sentiment, you’d be sorely mistaken. As Prime Minister Justin Trudeau said back in 2015:
There is no core identity, no mainstream in Canada. There are shared values—openness, respect, compassion, willingness to work hard, to be there for each other, to search for equality and justice. Those qualities are what make us the first post-national state.
How can Canada craft and successfully implement a law that forces every tech platform that distributes creative content to promote a minimum amount of “Canadian content” in order to advance “Canadian culture” when Canada’s own leaders don’t know what makes something Canadian and what Canadian culture is? Bill C-11 even states as a purpose of the bill:
[To] serve the needs and interests of all Canadians, including Canadians from racialized communities and Canadians of diverse ethnocultural backgrounds, socio-economic statuses, abilities and disabilities, sexual orientations, gender identities and expressions, and ages, and provide opportunities to Indigenous persons…
If you’re legislating for everyone and everything, aren’t you really just legislating for no one and nothing at all?
The second reason, not wholly unrelated to the first, is even more pervasive in Canadian politics: the government’s first instinct is always to legislate, and to legislate for equality of outcome, rather than for equality of opportunity.
As Canada’s Minister of Heritage (which is absolutely not a fake position), Pablo Rodriguez, who is spearheading the bill, recently put it: “[Bill C-11] will level the playing field in Canadian media.” Finally! It’s about time someone’s come along to level the playing field of Big Arts—where dark money and special interest groups pull strings behind the closed doors of recording studios and in smoke-filled musical theaters.
Even under the initial CanCon regulatory framework governing TV and radio, artists were unhappy. Outspoken, liberal, Canadian arts icons like Margaret Atwood and David Adams Richards have openly condemned the Canadian Government for its efforts to expand CanCon regulations. As Richards, who was appointed to Canada’s Senate by Prime Minister Trudeau, recently said on the Senate floor:
The idea of any hierarchical politico deciding what a man or woman is allowed to write to fit a proscribed national agenda is a horrid thing. I am wondering if anyone on the staff of our Minister of Canadian Heritage understands this. Cultural committees are based as much in bias and fear as in anything else. I’ve seen enough artistic committees to know that. George Orwell says we must resist a prison of self-censorship. This bill goes a long way to construct such a prison.
It’s undeniably far-fetched to compare Trudeau’s government to something out of Nineteen Eighty-Four (“Minister of Heritage” notwithstanding). And conservative talking points about how Bill C-11 is a “government censorship bill masquerading as a Canadian culture bill” and that the government just wants to “be able to filter what we see in our news feeds, what we see in our streaming feeds, what we see on social media” are also off the mark. Trudeau does not aspire to be Xi Jinping (well, except for that one time….).
What the Canadian Government does aspire to, though, is wielding its legislative powers to tilt the scales in favor of certain people or issues that it deems in need of protecting. In a general sense, this isn’t just normal, but it’s desired. We want our government to step in with tailored legislation to support people, classes and industries that are disproportionately neglected, impacted by market failures, or are otherwise structurally or systemically disadvantaged in real ways. That’s what government regulation is for. But we want those regulations to be targeted, timely, and tailored to the root cause of the problem.
Rather than legislating from the top, think of the impact disbanding the CRTC would have on Canada’s creative culture 20 years from now if we put the CRTC’s annual budget of $60 million towards grants and scholarships for young Canadians wanting to pursue a career in the arts. The only problem? That approach is too far-sighted for the Minister of Heritage and a government focused only on the next election cycle. As the former head of the CRTC said when he pared back the CanCon TV quotas from 55% to 35%, “[We want to foster] an environment where Canadians want to watch content made by our creators—not because it is forced upon them, but because it’s good.”
The issue with the Canadian Government is that it is far too focused on trying to remedy each and every social outcome it deems unfair. And when you combine that, with a self-righteous government that legislates from a moral high ground in the interest of whomever it deems “marginalized,” and then add in an apathetic population that places just a bit too much trust in its own government, then you get a whole lot of laws (from both conservatives and liberals) that get dangerously close to infringing on the basic rights of all, out of concern for an amorphous and ever-changing few. All the while, granting increasingly more power to the government itself. Rather than seeking to constantly bureaucratize everything, Canadians should encourage their government to, when and where appropriate, stay out of the way—something that would come as a welcomed change from the all-encompassing benevolent paternalism that Canadians face today.
Recall what the stated purpose of Section 230 was back when it was enacted in 1996:
[To] promote[] the continued development of the Internet and other interactive computer services, and preserves the vibrant and competitive free market that presently exists for the Internet and other interactive computer services, unfettered by Federal or State regulation.
Good legislation is sometimes defined not by what you do, but by what you don’t do. Although it runs counter to the very nature and interests of the legislators, when legislating, sometimes it’s best to cast a wide net, stand back, and let the chips fall where they may (to mix metaphors a little). Make no mistake, Canada is an exceptional country in many respects, and even the brightest democracies pass dubious legislation from time to time. But it’s a fool’s errand to try to impose complicated and rigid laws on an industry that represents creativity, individuality, counter-culture and free expression; even if that industry has made its way onto a new generation of technology platforms that have issues of their own. Except, of course, for whatever’s on TikTok—that, we should all just do away with entirely.
Convictions of a Sciolist 
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