'Surely we owe it to
Canadians to avoid any
Stuart Langford is a
maverick in the closed world of Canadian broadcasting regulation.
When appointed to the Canadian Radio-television and
Telecommunications Commission 18 months ago, he made it known he
wasn't going to play by the old rules based on backroom deals,
furtively dispensed favours and institutionalized cronyism.
Those who condemn the
CRTC as outdated, corrupt and hostile to the public interest
would likely regard Mr. Langford as a hero. Those who defend it
for taking a pragmatic approach to protecting Canada's cultural
industries might view him as a well-intended nuisance.
Mr. Langford arrived
at the CRTC with an intriguing curriculum vitae. While he
doubtless owed his appointment to Liberal connections from his
days as an Ottawa political aide, he is a lawyer and former legal
correspondent for CBC TV's national news. He's also,
incidentally, the uncle of Matthew Perry, the
US$1-million-per-episode co-star of the hit U.S. sitcom Friends.
At the CRTC, Mr.
Langford is known as a rigorous, no-nonsense commissioner. The
most interesting line in his biographical synopsis reveals he's
not without a sense of humour. "He has published two novels
that did not sell well," it says, followed by a stern
warning: "Mr. Langford does not do lunch."
It's Mr. Langford's
refusal to "do lunch" that baffles and irritates so
many CRTC colleagues and lobbyists in the cozy world of Canadian
communications regulation. Doing lunch, after all, is what
lubricates the system by establishing "good will"
between CRTC commissioners and the industry players who come
before them. What's wrong with that? Mr. Langford believes
socializing with industry players -- he calls it "viva voce
contact over a bon Chablis" -- corrupts the regulatory
Mr. Langford publicly
clarified his position at a recent Ottawa conference organized by
the Law Society of Upper Canada. The annual legal powwow, which
brings together a few hundred communications lawyers, lobbyists
and CRTC officials, is usually a polite affair. But this year's
event broke with the traditional code of silence and addressed
some touchy subjects, including the controversial matter of ex
parte contacts between lobbyists and CRTC officials.
"Can I, or can I
not, do lunch with the folks from Bell Canada?" asked Mr.
Langford. "If the Cable Association invites me to its annual
convention, waives the registration fee and lays on a hospitality
agenda that looks like it had been drawn up by the editors of
Gourmet magazine, may I attend? Should I attend?"
Mr. Langford's answer
is an unequivocal no. He noted, however, that most of his CRTC
colleagues see nothing wrong with schmoozing with industry
players. Their usual justification is that they're
"learning" about the industries they regulate. "I
disagree with that approach," he said. For him, innocently
sharing a bottle of Chablis with a cable lobbyist "just
isn't worth" exposing himself to the possible accusation of
Inside the CRTC, Mr.
Langford is dismissed by some as an officious purist. Outside the
commission, industry players have given up trying to co-opt him.
Morally celibate to a fault, he even politely returns corporate
annual reports in the mail. It's doubtful he will be seen
schmoozing next week at the annual Banff Television Festival,
where high-ranking CRTC officials show up to mingle with industry
heavyweights and lobbyists in a resort setting.
by-the-book professionalism is subversive because it constitutes
an indirect indictment of a regulatory system that, in many
instances, has become scandalously compromised over the years.
Evidence of the CRTC's indifference to the public interest is
pervasive -- from its condoning of cable TV's negative-option
billing to its aggressive hostility toward Power DirecTV as a
competitive alternative to the cable monopoly.
The CRTC's detractors
often argue, correctly, that new technologies, market
globalization, trade liberalization and the erosion of state
powers have made such heavy-handed, paternalistic bodies
increasingly irrelevant. Yet regulators -- in Canada and
elsewhere -- not only persist, they stubbornly continue to affirm
New technologies and
market forces are external challenges to state regulators. But
less attention is given to the sociological phenomenon that has
corrupted regulators from within -- namely, a creeping complicity
between quasi-judicial tribunals and the industry interests they
are supposed to regulate.
According to the
theory of "regulatory capture," bodies such as the CRTC
go through successive stages toward their own inevitable
corruption. In their infancy, regulators show youthful activism.
By middle age, they have succumbed to subtle co-option by
industry interests. In their final stage of bureaucratic
senility, they degenerate into passive instruments of the
corporate interests under their purview.
It would take
formidable powers of self-delusion to deny that the CRTC's
evolution has followed the capture theory with alarming fidelity.
Created in 1968, the commission was already slipping into
complicity with industry interests by the late 1970s. A decade
later, it was totally captured. This was especially true in
broadcasting. The telephone industry, over which the commission
wasn't given authority until the mid-1970s, has been regulated
with more rational instruments such as rate-of-return
calculations -- though telephone executives are no strangers to
Most accusations of
regulatory compromise are anecdotal, though some have been
levelled in the courts. But few succeed in exposing unethical
conduct. Such things as bias and cronyism are difficult to prove.
When a CRTC commissioner has breakfast with a cable executive,
the currency they are exchanging is good will. Good will has a
value. But does it constitute an indirect form of bribery?
The question is
debatable. Most major industry players will tell you, however,
that CRTC officials often welcome the exchange. Few industry
players do not have an anecdote about getting lobbied over lunch
by a CRTC commissioner looking for a job down the road. Indeed,
the most effective way to corrupt a regulatory official is
through an implied offer of future employment.
Within the commission
itself, the most coveted promotion is a job offer from outside --
preferably from one of the big TV networks, cable companies or
telephone giants. The one-way door between the CRTC and the big
industries it regulates has been swinging for so long there's no
longer any distinction between state and market. So thoroughly
has the CRTC been captured, its corporate culture puts a premium
on defection: The best and brightest leave.
Should the government
simply abolish the CRTC and throw the rascals out? Some argue
that competition law suffices to police market behaviour in the
media industries. Australia has moved toward a competition law
approach. And in the United States, antitrust laws have long
proven effective -- even if you disagree with their outcomes --
at breaking up combinations and conspiracies deemed not to be in
the public interest.
In Canada, however,
the Competition Bureau has weak statutory power, takes a myopic
case-by-case approach, and is generally considered excessively
permissive toward market failures. There is, moreover, evidence
the bureau is just as compromised as the CRTC. According to a
recent Democracy Watch report called Revolving Doors, many
lawyers working for the bureau also lobby the watchdog on behalf
of corporate clients.
One solution might be
to give the Competition Bureau a new statute, stronger powers and
the mandate to clean up internal conflicts of interest. Then the
CRTC could be declared redundant and abolished.
In the meantime,
Stuart Langford is left alone with his clean conscience. Don't
expect him to land a big job at Rogers or Bell Canada when he
leaves the CRTC in 2002. His legal rectitude is probably best
suited to the bench. Perhaps that's his problem -- or, rather,
the problem with the CRTC. Mr. Langford is one of the few
commissioners who take seriously the commission's status as a
quasi-judicial administrative tribunal.
wield enormous power," he says. "A simple yes or no may
spell the difference for a party before them between huge wealth
and dashed dreams ... A judge does not know from one day to the
next who might appear on his or her court docket. Not so a
regulator. We know for a fact that, sooner or later, our tribunal
will deal with each and every industry within our jurisdiction.
Surely we owe it to Canadians to avoid any source of taint by
socializing with those who will surely come before us."
It's doubtful Mr.
Langford's CRTC colleagues will rally to his cause. The moveable
feast of schmoozing, blandishments and cronyism is a mutually
enjoyable cost of doing business. No whisper campaign, media
expose or even finger-pointing court case is likely to put a stop
In the short term,
governments may lack the courage to abolish regulators for their
institutionalized corruption. In the longer term, however, new
technologies and market forces will succeed where public policy
Matthew Fraser is
professor of communications at Ryerson Polytechnic University.