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Derek Holt: It’s time to stop believing in policy fairy tales

Commentary

This excerpt was originally published at Scotiabank.com.

Canada believes in fairy tales. You see, we’re asked to believe that a national pharmacare program wouldn’t impose any net cost over and above the existing system of provincial plans and private insurers. Believing in that outcome goes against my training as an economist taught not to trust bloated government monopolies.

The PBO (here) had estimated last October that pharmacare would cost the Fed’s $33–38 billion per year as it is fully phased in over fiscal year 24–25 to fiscal year 27–28. They argued it would largely just replace existing spending by provinces and so incremental outlay by all governments would be only $11–13 billion higher per year over the projection period. They then deduct the existing private insurers’ spending that would be replaced by the public plan and arrive at no net incremental impact to spending on drugs in Canada. Presto, it’s magic, a national drug care program suddenly costs nothing! How convenient. Socialism never cost so little.

There are big caveats to their analysis:

1. First, it was assumed there would be a co-payment model but the deal that was just struck last week seems not to feature a co-pay. The purpose of a co-pay is to help ration demand at the point of the user by imposing a relatively small share of the cost on individuals with the rest covered by the plan. It mitigates abuse and waste. Ergo, take-up is likely to be larger than they assumed.

Now obviously when it comes to truly essential drugs for things like cancer treatment or diabetes there isn’t a choice, but what about other drugs? For instance, hasn’t it been understood for many years that wildly excessive prescriptions are doled out for many other medications, like antibiotics, the result of which has been to lessen their effectiveness within the population over time? The lack of a co-pay will make that worse and they could have at least tiered the program. I can see the lack of a co-pay having the effect of inflating many of the other costs for drugs and devices that this deal appears to cover.

2. Also, the scope of the plan seems larger than initially costed and even covers things that private plans often do not. That too would add to the cost. The Feds also indicated they intend to further broaden coverage toward more drugs and devices over time. Also not covered in the costing. The Feds themselves say they don’t know the ultimate cost of the program as it will depend upon negotiations with provinces and territories and presumably drug companies themselves. That’s comforting. Just make it up as you go.

3. Some have noted that the costing assumption that drug prices in Canada will immediately fall with a single-payer system of negotiation is unrealistic. They argue this is unlikely to happen and it’s uncertain how this factor will evolve over time. At a minimum, if this assumption of an immediate decline in drug prices proves to be invalid, then the costs in the early years are likely understated.

My bias is that concentrating purchases in the hands of one single-payer monopoly buyer is not a clearly superior outcome from a price, cost, choice, and quality standpoint. Monopolies can become rather inefficient and folks selling into said monopolies can engage in regulatory capture that drives inefficient outcomes. The Feds are going to be dictating what drugs you can have, and over time I don’t trust that Canadians will have the same choices.

Just ask folks subject to liquor monopolies that are run by self-serving bureaucrats who enjoy many benefits in their positions and drive a system that overcharges and reduces selection. Aren’t we trying to get away from those? I recall reading years ago about the experience of an Australian winery that had to wine and dine (literally…) provincial liquor control board officials for years in order to get listed in that province. Ring ring, hello, you’ve reached the Drug Control Board of Canada.

Just wait until they decide to go on strike too, not that public sector workers hold systems hostage by walking off the job or anything totally crazy like that…

In a bigger picture sense, I’m deeply worried about public policy in my country. Productivity is in a tailspin. A greater share of GDP is spent on here-today-gone-tomorrow current spending by governments and households than in decades. Tax policy is uncompetitive. Business bashing has become commonplace among people who’ve never spent two seconds working in private industry. Competition policy changes face serious criticisms (e.g. here). Changes to labour laws have benefited unions while collective bargaining exercises are driving wage growth to the moon despite collapsing productivity. Major sectors of the economy are literally being taken over by government with recent examples being child care, dental care, and now pharmacare. Do we get better quality outcomes in state-run health and education sectors? Tried visiting an ER lately? ‘nough said.

This excerpt was originally published at Scotiabank.com.

Mike Ramsay: Divisive DEI ideology is harming our students. It’s time to ditch it

Commentary

Late last month, the public learned that the Toronto District School Board (TDSB) through its Equity, Anti-Racism & Anti-Oppression Department issued a teaching guide claiming the Canadian education system is “colonialist” and designed to uphold the dominant white culture. The document, entitled “Facilitating Critical Conversations,” specifies that “education is a colonial structure that centres whiteness and Eurocentricity and therefore it must be actively decolonized,” and “schooling in North America is inherently designed for the benefit of the dominant culture (i.e., white, middle-upper class, male, Christian, cisgender, heterosexual, able-bodied, neurotypical, etc.)”. It adds that, “race matters—it is a visible and dominant identity factor determining people’s social, political, economic, and cultural experiences.”

While the school board has since temporarily removed the guide pending review after the Ontario Ministry of Education called it divisive, it is important that this thinking which has captured our school systems not be ignored. 

That this handbook was actually produced and distributed by the TDSB did not come as a shock to me, because, in my view, it is representative of what is taking place at other school boards right across Ontario. A reasonable question to ask is how all of this came about.

Having served as a trustee for 24 years, I would suggest it emerged because of the work of frontline activists who truly believe in their cause and that the system is stacked against racialized students. However, many others in leadership positions, who have other motives, simply see this as an opportunity to enrich themselves. They did this by pretending to address the activists’ perception of the issues.

As a Black trustee and past chair of a large school board (WRDSB), I often wondered what good could come from paying  DEI consultants upwards of $500.00 an hour to teach kids that if they are white the successes they experience are not due to personal effort. Meanwhile, racialized students are being taught that despite personal effort, their chances of success are diminished because society is racist and therefore biased against them.

The fact is that we have both white and racialized kids who are doing well academically. Conversely, we have white and racialized kids who are not doing so well. What I have found as a member of my board’s discipline committee is that the kids (from all backgrounds) who are not doing well usually have other issues that are at play, including, but not limited to significant behavioural issues that are impacting their ability to learn. However, you can’t tell this to the proponents of DEI, who have been busy organizing events to celebrate and take credit for the academic success of racialized students who I believe were, for the most part, never in danger of failing school in the first place. The credit should go to the parents and caregivers who worked and continue to work hard to encourage and support their children.

Thankfully, with the passing of each day, more and more people are beginning to question the need for school initiatives that are fixated on identity politics. They are coming to realize that certain aspects of DEI instruction can actually lead to greater prejudice and even harm, as highlighted in a recent study released by the Aristotle Foundation and authored by Professor David Haskell. 

Haskell’s report shows that DEI related to “anti-racism” education and its promotion of “white privilege” doesn’t make participants more sympathetic to disadvantaged Black people as DEI trainers claim, and can in fact make them more hostile toward poor white people.  

As he elaborates, “Teaching students about white privilege, a core component of the DEI curriculum, does not make them feel more compassion toward poor people of colour but can reduce sympathy [and] increase blame…for White people struggling with poverty.”

In light of Haskell’s overwhelming evidence, I feel school boards should be required to justify the expense and existence of DEI in their organizations. Moreover, if it is doing harm as his research shows, do we not have an obligation to use legislation to stop the practice immediately in our classrooms?

I would say we do. And, that is why I agree wholeheartedly with parent Liz Galvin who recently told the Halton District School Board: “Trustees, when your equity and inclusion policies are used to generate administrative procedures by un-elected DEI proponents that contradict the aims and prescribed goals of said policy, then you have an obligation to insist that they be scrutinized, amended and or removed.” 

It seems straightforward, but the practice will not stop if it is left solely to the discretion of the Ontario NDP supporting majority which dominates most school boards.

This is where the Progressive Conservative government of Premier Doug Ford comes in. Even though his government has made it clear through their 2023 Better Schools and Student Outcomes Act (Bill 98) that they want boards to be dead focused on tangible measurable learning achievement,   rather than on faddish so-called “social justice” experiments, boards continue to double down on these DEI initiatives. I don’t know if the government is tiptoeing around the issue out of fear that the far-Left radicals entrenched in our education system will attack them. More and more parents and education workers from all backgrounds across our province are paying closer and closer attention to the damage being done. It is time for the Ford government to respond firmly and issue clear directives to boards to end these divisive practices.