Canadian STUDENT REVIEW
WINTER 2016 QUARTERLY STUDENT MAGAZINE
STUDENT ESSAY CONTEST WINNERS SAFETY VS. PRIVACY IN A TECHNOLOGICAL AGE
What’s The Inequality Supreme Court Ruling on Canada’s Physician Inside Trap First Nations Land Dispute Supply Editor: Lindsay Mitchell Canadian Layout and design: Foothills Graphics STUDENT REVIEW Production Editor: Kristin McCahon Cover image: iStock Photo Photo credits: Reproduction rights for the cover images and other photos were purchased from iStock Photo, Dreamstime Photos, and Shutterstock Photo. Public domain and shared images provided by Wikimedia Commons, Wikipedia and Flickr.
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Copyright © 2016, the Fraser Institute Date of Issue: Winter 2016 ISSN 1707-116X (online edition)
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Dear Readers, Since the beginning of the 21st century, government surveillance and access to citizens’ private information has climbed to unprecedented levels. But to what extent should governments be allowed to monitor their citizens and do these actions actually keep us safer? These are some of the questions answered by the 1st place winners of our 2015 essay contest, National Security and the Role of Government: Safety vs. Privacy in a Technological Age, who beat over 700 students to have their winning essays featured in the winter edition of CSR. This issue also looks at Canada’s physician supply and the recent ruling from the Supreme Court of Canada, which allows First Nations to sue private parties over land disputes, lawsuits that were previously only brought against governments. In the Hot Topics section, new Fraser Institute research looks at the trade barriers between provinces and the environmental risks and effects of hydraulic fracturing. Our featured book recommendation, The Inequality Trap: Fighting Capitalism Instead of Poverty, has Senior Fellow and National Post columnist William Watson examining society’s fight against “the 1%” instead of focusing on trying to helping lower-income individuals. Enjoy!
Lindsay Mitchell Editor, Canadian Student Review
Canadian STUDENT REVIEW
CANADIAN STUDENT REVIEW WINTER 2016 1 Contents
4 1st Place Essay: High School Student Category NATIONAL SECURITY VS. PRIVACY IN THE MODERN AGE by Javaria Mughal
11 THE QUOTE WALL Eli Dourdao Technology expert and previous student seminar presenter comments on the future of driverless cars.
12 THE BOOK CORNER The Inequality Trap: Fighting Capitalism Instead of Poverty by William Watson Fighting inequality should not be our top policy priority.
13 1st Place Essay: Undergraduate Student Category GOVERNMENT SPONSORED BLACKMAIL? MASS SURVEILLANCE AND THE THREAT TO PERSONAL PRIVACY by Ben Woodfinden
VIDEO GALLERY 20 For-profit Hospitals and Universal Health Care For-profit hospitals can be part of high-performing universal health care systems.
2 FRASERINSTITUTE.ORG 21 1st Place Essay: Graduate Student Category PRIVACY VERSUS SECURITY: DOES A TRADE-OFF REALLY EXIST? by Demelza Hays
FRASER FORUM 30 Historic Court Ruling Also Raises Questions for First Nations Pursing Aboriginal Title by Ravina Bains A look at a Supreme Court Ruling allowing a damages claim against aluminum giant, Rio Tinto.
Investor confidence is shaking Due to Alberta’s policy uncertainty FISCAL TERMS AND32 ROYALTIES 2014 RANKINGS 2015 RANKINGS INFOGRAPHIC Oil and Gas Sector Losing Confidence in Alberta 14% 39% 16. ALBERTA deterrent deterrent
2014 2015 as a Place to Invest
ENVIRONMENTAL REGULATIONS
38% 52% 38. ALBERTA deterrent deterrent
2014 2015 33 FROM THE ARCHIVES Canada’s Physician Supply by Nadeem Esmail Doctor-to-population ratio will decline unless Canada becomes more reliant on foreign-trained physicians.
HOT TOPICS Harmonize Achieve mutual apprentice training recognition of Allow requirements product and service inter-provincial trade within43 three years in dairy products. standards. What’s New from the Institute
Coordinate a Establish a path single, national towards free corporate registration trade in energy products A look at free trade between provinces and the system for ease of business reporting. environmental risks and effects of hydraulic fracturing.
CANADIAN STUDENT REVIEW WINTER 2016 3 1st Place Essay Contest Winner High School Category NATIONAL SECURITY VS. PRIVACY in the Modern Age Javaria Mughal
overnment surveillance has May 7; Condon, 2013, June 12). Such justifiably developed problems demonstrate a need to a negative connotation due reevaluate the scope of intelligence Gto governments’ mass accumulation operations, and the regulations that of the personal and communications govern them. However, surveillance data of millions of citizens, remains a necessary component in misleading or overblown claims securing a nation and protecting its about the effectiveness of these bulk constituent citizens. surveillance programs in preventing terrorist attacks (Bergen, Sterman, Today, terrorism poses a legitimate Schneider, and Cahall, 2014), and threat to Western countries, as the dubious legal footing of these illustrated by the events of 9/11, programs (Associated Press, 2015, threats from extremist groups such
4 FRASERINSTITUTE.ORG as ISIS, and attempted plots on differed. Consequently, prosecutors Western countries (Bergen, Sterman, found it difficult to establish a Schneider, and Cahall, 2014). The comprehensive picture of the night’s attacks on 9/11 and the conflicts events. The presence of CCTV created by extremist groups in the cameras or other visual surveillance Middle East demonstrate these equipment could have more clearly terrorist organizations’ significant established the facts and better capacities for destruction. To enabled the successful prosecution prevent potentially catastrophic of George Zimmerman, or attacks on Western countries, corroborated his innocence as ruled governments must use preemptive by the court (Bilton, 2013, July 16). measures to identify and neutralize Too often do the facts surrounding possible strikes before they injustices come down to the word occur. Without monitoring highly of those with unreliable knowledge, suspected persons’ communications or reason to lie, and too often do we and activities, government fail to bring justice, or know if justice NATIONAL security programs are less able has been brought, to those actually to assess the severity of threats, guilty or innocent. as their only intelligence sources would be intermittent tips. US SECURITY To prevent potentially catastrophic intelligence claims to have already stopped dozens of attacks through attacks on Western countries, VS. PRIVACY preemptive investigation and governments must use preemptive response, yet some analysts believe measures to identify and neutralize in the Modern Age that these numbers are exaggerated possible strikes before they occur. (Bergen, Sterman, Schneider, and Javaria Mughal Cahall, 2014). Having established the usefulness of surveillance, the next step Today, terrorism poses a legitimate becomes determining the extent to threat to Western countries, as which surveillance is appropriate. illustrated by the events of 9/11 In 2013, Edward Snowden leaked and threats from extremist groups evidence of the US government’s such as ISIS... bulk surveillance programs, including the PRISM program for collecting Internet communications of the Government surveillance can be bulk telephony metadata extraction useful in many domains other justified under Section 215 of the US than terrorism. Cases involving Patriot Act (Granick and Sprigman, unwarranted police violence, 2013, June 27). Since this release, assault, theft, and murder can be US government officials have aided through CCTV cameras. In consistently stressed the need for the State of Florida vs. George these programs. President Obama Zimmerman case, eyewitness defended them as integral to the accounts of the conflict between protection of American citizens Zimmerman and Trayvon Martin all (Baker, 2013, June 17). NSA Director
CANADIAN STUDENT REVIEW WINTER 2016 5 Gen. Keith Alexander stated before Programs Stop Terrorists? Congress that “the information determined that NSA surveillance gathered from these programs only initiated 7.5% of investigations, provided the US government with of which 1.8% involved bulk critical leads to help prevent over telephony metadata under Section 50 potential terrorist events in more 215 of the USA Patriot Act, 4.4% than 20 countries around the world” involved surveillance under Section (United States Congress, 2013, June 702 of the FISA Amendments Act, 18). However, a report from the New and 1.3% involved an unidentified American Foundation casts doubt on authority. On the other hand, these claims. traditional investigative methods, including the use of tips, informants, intelligence from traditional How large a role does bulk CIA and FBI sources, routine surveillance play in counter- law enforcement, militants’ self- terrorism efforts? disclosure, and reports of suspicious activity initiated 60% of investigations. The initiation methods in 27.6% of By analyzing 225 cases involving cases are unclear; though possible, individuals charged with some it is unlikely that NSA surveillance terrorism crime, the authors of the initiated these investigations, as the report Does NSA’s Bulk Surveillance government would have then likely
6 FRASERINSTITUTE.ORG indicated such key contributions in Basaaly Moalin with al-Shabaab, an order to emphasize the benefit of its al-Qaeda affiliate. The FBI discovered surveillance programs. Either way, that Moalin was in contact with these statistics are inconsistent with al-Shabaab officials when he was US officials’ claims about the large caught providing $8,500 to an role that bulk surveillance plays in al-Shabaab affiliate. Though bulk counter-terrorism efforts (Bergen, collected metadata was apparently Sterman, Schneider, and Cahall, 2014). used, it is noteworthy that the FBI did not start investigating Moalin In fact, available evidence suggests until two months after the NSA first that bulk collection is not necessary. provided a tip. Furthermore, this During a Senate Judiciary one case which US officials use to Committee hearing in October 2013, argue the necessity of mass data NSA Director Alexander admitted collection does not even illustrate a that the bulk collection of American need for sweeping bulk collection of telephone metadata had only metadata, but rather the collection prevented one known terrorist attack of metadata for communications in in the US (United States Senate, which one party is a known or highly 2013). In this case, the government suspected terrorist. Such a metadata used telephone metadata to collection method would also have connect San Diego cab driver sufficed in other investigations,
CANADIAN STUDENT REVIEW WINTER 2016 7 such as that of Najibullah Zazi. Zazi, Many people perceive mass who was planning to bomb the New government surveillance of York City subway system in 2009, individuals’ communications and was communicating with an email actions as intrusive and ultimately address known to belong to an al- discomforting (CBC News, 2015, Qaeda figure five months prior to January 28). Surveillance advocates the NSA’s interception of Zazi’s email quickly dismiss such apprehensions (Bergen, Sterman, Schneider, and with the phrase, “If you have Cahall, 2014). nothing to hide, you have nothing to fear.” But as computer security expert Bruce Schneier counters, the The failure to prevent the “nothing to hide” argument is built September 11th attacks despite on a premise that “privacy is about the slew of warnings suggests hiding a wrong” (Schneier, 2006, that what intelligence agencies May 18). Privacy does not necessitate require is not more data, but better misdeed, and is a valued right that responsiveness and appropriate provides citizens immense comfort information-sharing within and satisfaction. Thus, privacy is government. worth protecting.
Privacy does not necessitate We are often presented with a misdeed, and is a valued right that dichotomy that has the 2001 terrorist provides citizens immense comfort attacks on one side, and government and satisfaction. surveillance on the other. However, US intelligence agencies were repeatedly informed of possible More complications arise when intelligence agencies seek to attacks by Osama bin Laden for interpret the massive datasets they several months leading up to the have extracted. Innocent jokes or September 11th attacks. In the spring statements can be misinterpreted as of 2001, top officials were briefed by terrorist threats when taken out of reports indicating the existence and their proper context. For instance, advancement of bin Laden’s plans. a man named Joe Lipari spent two These warnings continued through years fighting charges after he the summer with reports indicating paraphrased a quote from the film continuing plans for bin Laden’s Fight Club. The literal meaning of attacks and imminent threats his statement seemed to threaten (Eichenwald, 2012, September an Apple store, but in context, it 10). The failure to prevent the was a harmless joke written without September 11th attacks despite the the intention of pursuing violent slew of warnings suggests that what action (Booth, 2010, September intelligence agencies require is not 24). Due to the clandestine nature more data, but better responsiveness of government surveillance and appropriate information-sharing operations, it is difficult to precisely within government. quantify the number of individuals
8 FRASERINSTITUTE.ORG incorrectly deemed a threat and The government’s mass accumulation inconvenienced by false charges. of telephony and Internet data is However, the fundamental issue of unnecessary for ensuring national context must be addressed. To more security. Furthermore, surveillance of accurately interpret the information those who have done nothing wrong they receive, intelligence agencies can lead to unjust repercussions for must work to develop accurate data the innocent. Therefore, the scope of analysis programs while ensuring the government surveillance should be products of algorithms are checked limited to: by humans, who have greater • Telephony and Internet metadata of capacity to contextually evaluate communications, in which one party statements, and determine the true is a known or highly-suspected level of threat posed. terrorist, or person of threat • Content of telephony and Internet Surveillance of those who have communications of persons done nothing wrong can lead demonstrated to have probable to unjust repercussions for the involvement in terrorist activity—for innocent. which a warrant must be granted • CCTV cameras in public spaces (thus excluding inside residences, It is simply not the case that corporate offices, etc.) government surveillance always allows illegal acts to be prevented Ultimately, some measure of or punished, and better protects government surveillance must innocent citizens. The effects of be maintained to ensure national pervasive surveillance are much security. However, restrictions more ambiguous, and often negative. must limit the scope of information Throughout history, governments monitored to protect innocent have targeted individuals based individuals from unwarranted merely on ideological, political, or targeting, and repercussions. religious beliefs rather than evidence Surveillance is a powerful tool of criminal intent. For instance, that can be abused by unfairly during World War I, the precursor to targeting citizens, or wielded the FBI, the Bureau of Investigation, responsibly to improve public safety. spied on and sometimes prosecuted Only responsible oversight and war critics, anti-draft activists, restrictions on surveillance programs and pacifists. Intense and intrusive will promote the justice we seek. FBI monitoring also targeted the civil rights, feminist, and anti- Vietnam movements (Fischer, 2015). Considering this pattern of abuse, Javaria Mughal is currently a Grade 12 it is best to forego surveillance of student at The Woodlands the communications of an entire School. After graduation, country’s population in order to avoid she plans to study English unjust targeting. and Economics.
CANADIAN STUDENT REVIEW WINTER 2016 9 REFERENCES Associated Press (2015, May 7). US Appeals Court: NSA Phone Record Collection Is Illegal. New York Times.
Baker, Peter (2013, June 17). Obama Defends Authorization of Surveillance Programs. New York Times.
Bergen, Peter, David Sterman, Emily Schneider, and Bailey Cahall (2014). Does NSA’s Bulk Surveillance Programs Stop Terrorists? New America Foundation (January).
Bilton, Nick (2013, July 16). The Pros and Cons of Surveillance Society. New York Times.
Booth, Robert (2010, September 24). Twitter Joke Trial Man’s Bomb Threat was “Hyperbolic Banter”. Guardian News and Media.
CBC News (2015, January 28). Cyber Surveillance Worries Most Canadians: Privacy Czar’s Poll. CBC News.
Condon, Stephanie (2013, June 12). Lawmakers Question Legal Basis for NSA Surveillance. CBS News. http://www.cbsnews.com/news/lawmakers-question-legal-basis-for-nsa- surveillance/ as of May 29, 2015.
Eichenwald, Kurt (2012, September 10). The Deafness before the Storm. New York Times,
Fischer, Linda E. (2015). Guilt by Expressive Association: Political Profiling, Surveillance, and the Privacy of Groups. Arizona Law Review 46: 621-675.
Granick, Jeniffer Stisa, and Christopher Jon Sprigman (2013, June 27). The Criminal NSA. New York Times.
Schneier, Bruce (2006, May 18). The Eternal Value of Privacy. Wired.
United States Congress (2013, June 18). House Select Intelligence Committee Holds Hearing on Disclosure of National Security Agency Surveillance Programs. Congressional Hearings.
United States Senate, Committee on Health, Education, Labor, and Pensions (2013). Continued Oversight of the Foreign Intelligence Surveillance Act. Hearing, video (October 2).
10 FRASERINSTITUTE.ORG QUOTE WALL
“In an inevitable car accident, what object should you hit: the last endangered white rhino or a busload of nuns?”
“ re we ready for driverless hit both and still save a million more cars? According to some lives than accident prone human safety testers, the answer is drivers?” A“no” because they haven’t been able to answer hypothetical questions, Eli Dourado, Director of Technology such as “In an inevitable car Policy Program, Mercatus Centre accident, what object should you hit: at George Mason University and the last endangered white rhino or a presenter at Vancouver student busload of nuns?” seminar, October 24, 2015: Regulating Emerging Technology: But what if the answer doesn’t How Drones and 3D Printing are matter because driverless cars can Changing the World.
CANADIAN STUDENT REVIEW WINTER 2016 11 Fraser Institute researcher-recommendedTHE BOOK THE books on free market policies andCORNER economics BOOK CORNER
THE INEQUALITY TRAP: FIGHTING CAPITALISM INSTEAD OF POVERTY
S President Barack Obama has called economic inequality the “defining issue of our Utime.” It has inspired the “Occupy” movements, made a French economist into a global celebrity, and given us a new expression—the “one percent.” But is our preoccupation with inequality really justified? Or wise? 1st Place Essay Contest Winner In his new book, William Watson argues Undergraduate Category that focusing on inequality is both an error and a trap. It is an error because much inequality is “good,” the reward for thrift, industry, and invention. It is a trap because it leads us to fixate on the top end of the income distribution, rather than on those at the bottom who need help most. In fact, if we respond to growing inequality by fighting capitalism rather than poverty, we may end up both poorer and less equal. Explaining the complexities of modern economics in a clear, accessible style, The Inequality Trap is a great response to the idea that fighting inequality should be our top policy priority.
William Watson, is a Professor of Economics at McGill University, Columnist for the National Post, and a Senior Fellow of the Fraser Institute.
12 FRASERINSTITUTE.ORG 1st Place Essay Contest Winner Undergraduate Category GOVERNMENT SPONSORED BLACKMAIL? Mass Surveillance and the Threat to Personal Privacy Ben Woodfinden
CANADIAN STUDENT REVIEW WINTER 2016 13 dward Snowden is a No. 755 at 227-230 (1976)). Every polarizing figure. Yet even presidential administration since his detractors must concede Franklin Roosevelt’s has made use of Ethat the information he disclosed the state apparatus to spy on political about the surveillance operations opponents (Downs, 2013, June 14). In of the US National Security Agency the early 1970s, a series of scandals (NSA) and other security agencies involving American intelligence worldwide have led to an important agencies shook public trust in the US public discussion on surveillance and government. Between 1968 and 1975, civil liberties in the post-9/11 world. public trust in government dropped from 61% to 36% (Pew Research Centre, 2014). As a result, Congress Snowden’s disclosures have initiated the Church Committee raised a series of important in 1975 to investigate American intelligence gathering in the wake of legal, philosophical, and political these revelations (Senate Historical questions. Office, 1975).
Snowden’s disclosures have The final Church Committee raised a series of important report, published in 1976, revealed legal, philosophical, and political widespread and systematic abuses questions. Do mass surveillance of power (Senate Select Committee, programs actually keep us safer? No. 755 at 16-17 (1976)). On multiple More fundamentally, can we trust occasions, the CIA, FBI, and NSA the government not to misuse the violated the fundamental rights of information it gains through mass peaceful American citizens. One surveillance? In the United States, specific example is worth highlighting. where many of these debates are The founder of the FBI, J. Edgar centered, there is a history of the Hoover, was notoriously unconcerned state misusing the surveillance with violating certain citizens’ powers it has granted to itself. constitutional rights in the name of Historical government surveillance protecting the country against (often in the United States has resulted in imaginary) enemies (Kessler, 2002: blackmail intended to silence dissent. 140). One such imagined enemy Disturbingly, this is also taking place was Martin Luther King. Despite today. overwhelming evidence that he was not a security threat, Hoover ordered extensive surveillance and wiretapping MASS SURVEILLANCE IN THE of King. The surveillance produced UNITED STATES BEFORE 9/11 nothing to suggest that King was a security threat, but it did produce The debate raging around mass evidence of sexual misconduct. This surveillance is not new. The American included a tape of King participating government has been using large- in an orgy in a Washington hotel. scale peacetime surveillance since at Although this information had no least 1919 (Senate Select Committee, relevance to any security operations, a
14 FRASERINSTITUTE.ORG governments use these programs to violate citizens’ basic rights and discredit political opponents then they become a danger to, and not a guardian of, the people they are supposed to protect.
If governments use surveillance programs to violate citizens’ basic rights and discredit political opponents then they become a danger to, and not a guardian of, the people they are supposed to protect.
MASS SURVEILLANCE IN THE POST-9/11 ERA In the aftermath of the Church
J. Edgar Hoover, first Director of the Federal Bureau Committee, Congress established of Investigation. In office March 23, 1935 – May 2, 1972. the Foreign Intelligence Surveillance Wikipedia photo Court (FISC), a special judicial body that had the power to consider letter was sent out to King that requests for secret warrants to spy included copies of the tape shortly on non-US persons acting as foreign before he received the Nobel Prize. agents within US borders. The court The intention was clear: to blackmail was supposed to end the frequent King and either damage his credibility abuses that the Church Committee or force him to resign his position uncovered by introducing a layer of (Kessler, 2002: 144). judicial accountability.
On repeated occasions, surveillance Only weeks after the September 11 operations were not designed to attacks, Congress passed the Patriot simply monitor for suspicious activity. Act, which vastly increased the power Rather, they were intended to collect of American intelligence agencies. information that could be used to Oversight from both Congress and attack the reputation and character the FISC was supposed to ensure of the individuals in question (Senate the law was not misused. However, Select Committee, No. 755 at 221 many suspected that intelligence (1976)). The temptation to use mass agencies abused the law nevertheless surveillance programs to silence (Greenwald, 2013, September 27). and discredit political opponents is an obvious one, and it is one In June of 2013, The Guardian began with a well-documented history. If publishing leaked documents about
CANADIAN STUDENT REVIEW WINTER 2016 15 secret NSA programs. The suspicions historical abuses by agencies such of several critics of surveillance were as the FBI? Documents disclosed by confirmed, including revelations that Snowden suggests that this is the governments have the capacity to case. One document that Snowden collect, store, and analyze almost released through The Guardian from all of our online and electronic October of 2012 suggests that the communications. Furthermore, NSA had been collecting evidence governments have indeed exercised of online sexual activity, such as these abilities. Programs like visits to pornographic websites, by PRISM, Boundless Informant, and six different targets (Ehrenfreund, XKeyscore allow the NSA to collect 2013, November 27). All six men enormous amounts of information were Muslims, and were believed about anyone it deems of interest by the NSA to have been involved directly from the Internet backbone in radicalization efforts. However, (Bauman, 2014: 122-126). Questions none of the six targeted individuals of constitutionality aside, these were accused in the document of programs completely overstep the being involved in terror plots. The intent and scope of the Patriot Act.1 document identifies at least one of them as being a “US Person,” a Does the NSA’s abuse of surveillance significant legal category that would power have any similarities to preclude surveillance overseen by
1 For more information on the scope and constitutionality of the Patriot Act, see Etzioni, 2004.
16 FRASERINSTITUTE.ORG the FISC. The intention of collecting is dulled. Individuals lose the full this information, according to the freedom to speak as they please, document, was to release evidence afraid of sanctions from a government of sexual transgressions online to that does not welcome certain views. discredit and destroy the reputations Thus, in the name of security, these of the individuals in question. programs harm the very freedom they are supposed to protect. As we have seen, this is not without precedent. The FBI under Hoover In his dissenting opinion in Olmstead is the most obvious example of v. U.S, Supreme Court Justice this. Not only has the NSA used Louis Brandeis offered a famous surveillance tools to discredit those formulation on the value of privacy. it deems dangerous, it has also used Brandeis wrote that: those tools to spy on the members The makers of our Constitution of Congress tasked with overseeing undertook to secure conditions NSA programs and funding (Pengelly, favorable to the pursuit of 2014, January 4). While it is unclear happiness. They recognized the how extensive this spying is, the significance of man’s spiritual potential for abuse is evident. Mass nature, of his feelings, and of his surveillance programs are known intellect. They knew that only a to have been used by the NSA to part of the pain, pleasure and blackmail individuals who were satisfactions of life are to be found not involved in planning any terror in material things. They sought to attacks against the United States. protect Americans in their beliefs, their thoughts, their emotions and their sensations. They conferred, The power that mass surveillance as against the Government, the gives to governments creates right to be let alone—the most comprehensive of rights and the a historically verifiable threat to right most valued by civilized men. individuals by creating the potential (Olmstead, 277 U.S. 438 (1928)) for state-sponsored blackmail. From formulating heterodox opinions to character evolution, privacy is a vital component in the development CIVIL LIBERTIES AND MASS of our personal identities. Studies SURVEILLANCE have shown that human behaviour changes substantially when people The power that mass surveillance believe, correctly or incorrectly, that gives to governments creates a they are being watched (Ernest- historically verifiable threat to Jones, Nettle, and Bateson, 2011). individuals by creating the potential There is a reason that we do not for state-sponsored blackmail. But have toilets in the middle of living why is this so dangerous? Put simply, rooms: we naturally value privacy. when governments blackmail their There are things about ourselves, citizens, the potential for dissent from our bodily appearance to the
CANADIAN STUDENT REVIEW WINTER 2016 17 websites we visit to our personal often violate our civil liberties and banking information, that we do not abuse the immense power they want others to know. Regardless of wield to silence dissent and discredit any positive impact this may have opposition. on the behaviour of individuals, we should be wary of attempts by Mass surveillance in the modern governments to influence and change era fundamentally changes our our behaviour. State mandated paternalism reduces the autonomy relationship with the government. of the individual and invites even more government intrusion in the Privacy enables us to have private private lives of citizens. Even if the lives and to do things we may not behaviours of anti-war activists, want others to know about. When we or Martin Luther King, or Islamic lose this sphere of privacy, anything preachers, were questionable or embarrassing or questionable in our unpopular, they should not have personal lives becomes a weapon been used by their government as a that can be used against us. This weapon to silence their speech. It is information can then be used to in the private realm that we can think, silence dissent or opposition, as both write, speak and act away from the the FBI and the NSA have attempted judgement of others. Privacy is thus a to do. Time and time again, security foundational part of what it means to agencies have shown that they be a free individual. cannot be trusted with the sensitive information they collect about Privacy is a foundational part individuals; the temptation to use this of what it means to be a free information is simply too strong. individual. Mass surveillance in the modern era fundamentally changes our relationship with the government One of the major findings of the by creating the potential to destroy Church Committee was that that the private sphere. If we cannot “covert action programs [had] been have privacy, we cannot have used to disrupt the lawful political secrets. What’s worse, those who activities of individual Americans are not willing to give up their and groups and to discredit them, secrets become potential victims using dangerous and degrading of state-sanctioned extortion. The tactics which are abhorrent in a deck is stacked against privacy free and decent society” (Senate either way. From FBI spying on Select Committee, No. 755 at 211 prominent civil rights and anti- (1976)). A 21st century investigation war activists to present-day NSA of the contemporary activities of spying on Islamic preachers, there American intelligence agencies would are too many examples of state- very likely find evidence of similar sponsored blackmail for us to trust wrongdoings. Government agencies that the government will not use
18 FRASERINSTITUTE.ORG the information it collects against dissidents who pose no threat to Ben Woodfinden is a current national security. While surveillance graduate student at Carleton programs are designed to protect University, specializing in Political Philosophy. He graduated from us, ultimately the misuse of the Carleton with a B.A in Political information collected through these Science and History in June programs endangers the very rights 2015. Ben has public policy they are supposed to protect. experience having previously worked for Transport Canada and the Canadian Federation of Independent Business.
REFERENCES Bauman, Zygmunt, Didier Bigo, Paulo Esteves, Elspeth Guild, Vivienne Jabri, David Lyon, and R.B.J. Walker (2014). After Snowden: Rethinking the Impact of Surveillance. International Political Sociology 8 (2): 121-144.
CANADIAN STUDENT REVIEW WINTER 2016 19 VIDEO GALLERY
For-Profit Hospitals and Insurers in Universal Health Care Countries
1st Place Essay Contest Winner Graduate Student Category
SEE THE VIDEO HERE
FOR-PROFIT HOSPITALS AND UNIVERSAL HEALTH CARE
Contrary to the way they are often perceived in Canada, for-profit hospitals are a part of high-performing universal health care systems in other countries such as Australia, France, Germany, the Netherlands, and Switzerland.
Learn more ››
20 FRASERINSTITUTE.ORG 1st Place Essay Contest Winner Graduate Student Category PRIVACY VS. SECURITY Does a tradeoff really exist? Demelza Hays
he recent disclosure of the government to stop terrorism before National Security Agency’s it happens. However, this claim (NSA) “PRISM” program cannot be substantiated. Government Tby Edward Snowden has sparked surveillance programs function under a debate concerning the trade- an implicit assumption: surveillance off between privacy and security. is the best method for preventing Proponents of government terrorism. In order to investigate this surveillance argue that security is assumption, the costs and benefits of more important than privacy, and surveillance must be compared with that these programs enable the the costs and benefits of alternative
CANADIAN STUDENT REVIEW WINTER 2016 21 strategies. The remainder of this paper demonstrates that an analysis of the As you have watched the developments in news stories about monetary and nonmonetary costs government monitoring programs and benefits of government spying over recent months, would you say cannot be conducted with sufficient that you have become more confident precision. Therefore, the assumption or less confident that the programs that public safety requires the are serving the public interest? curtailment of privacy is unfounded.
The assumption that public safety requires the curtailment of privacy % is unfounded. 38 % More Confident In response to the Parliament Hill 62 shootings in Ottawa last year by Less Michael Zehaf-Bibeau, Prime Minister Confident Stephen Harper pledged to expand government surveillance (Northam, 2014). However, he failed to explain why the current level of spying was insufficient to prevent Mr. Zehaf- Pew Research, 2015 Bibeau from committing a terrorist act or how expanding surveillance will that the NSA accessed details of prevent future attacks. Government customer conversations from at least websites and official speeches do nine companies including Google, not reveal specifically how these Yahoo, and Microsoft (Gellman and programs work, what types of data Poitras, 2013). Slides released by they collect, or what results have been Edward Snowden show that the achieved. The bulk of the information NSA collects data ranging from live available has surfaced thanks to communications to stored information whistleblowers such as Edward such as emails, videos, photos, and Snowden, Thomas Andrew Drake, and Skype calls too. In the US, court cases William Binney. such as Jewel v. NSA have accused Opponents of government the government of overseeing surveillance claim that bulk data an “illegal and unconstitutional collection infringes upon individual program of dragnet communications rights. On June 6, 2013, the Guardian surveillance” (Jewel, 2008). Although, reported on an NSA court order the government has dismissed these to a Verizon subsidiary to disclose claims, the US district court judge the phone records of millions of for the District of Columbia, Richard domestic customers (Greenwald, Leon, stated that bulk data collection 2013). The next day, the Guardian probably does violate the Fourth and the Washington Post reported Amendment (Klayman et al., 2013).
22 FRASERINSTITUTE.ORG Although the legality of bulk data conclude that the government cannot collection is still being debated, the vindicate the surveillance of citizens. assumption that surveillance is the For purposes of this paper, objectives best method for abating terrorism is costs and benefits are factual unwarranted. The theoretical tools expenditures and revenues that were used by central planners to conduct generated by the operation of a cost-benefit analyses are structurally government surveillance program. It is unsound because they function under difficult to precisely measure objective the assumption that interpersonal benefits from surveillance because and intrapersonal comparisons of the subverted plots will not occur; utility are possible. Even the most any attempt to estimate the damage careful analyses can therefore only subverted would be hypothetical. yield tentative figures that do not If a surveillance program stopped a include nonmonetary valuations. terrorist act from being implemented, The twentieth century economist, analysts could estimate the number Ludwig von Mises, explained that of lives saved and the monetary cost governments couldn’t distribute of the damage prevented. However, resources rationally in an economy the Justice Department’s Inspector without a free market for the means General, Michael E. Horowitz, admitted of production (Mises, 1990). Although Mises described the calculation that FBI agents had not stopped any problem in the context of socialist terrorist acts because of snooping countries, any government that powers granted by Section 215 of operates outside of the free market the Patriot Act (Office of Inspector cannot conduct truthful cost-benefit General, 2015). During a press meeting analyses. The price mechanism on with German Chancellor Angela the free market is the only institution Merkel, President Obama announced, that encompasses the subjective “We know of at least 50 threats that valuations of individuals. have been averted because of this information not just in the United States, but, in some cases, threats Although the legality of bulk data here in Germany. So lives have been collection is still being debated, saved” (Office of the Press Secretary, the assumption that surveillance 2013). However, an independent is the best method for abating report commissioned by the White terrorism is unwarranted. House does not cite a single example where the NSA’s data collection actually stopped a terrorist attack This paper investigates two separate strategies for measuring the costs and (Clarke, Morell, Stone, Sunstein, and benefits of government surveillance. Swire, 2013, Dec. 12). First, an analysis of the objective, Since bulk data collection on citizens or financial, costs and benefits is has not prevented any known attacks, presented. The second method the objective benefits are negligible. involves an analysis of the subjective, However, the objective costs of or personal, costs and benefits that surveillance are quite substantial. each individual incurs. Both methods An example of an objective cost
CANADIAN STUDENT REVIEW WINTER 2016 23 is the estimated CA$4.2 billion to Instead of taxpayer funds construct and maintain Canada’s supporting education, health, most expensive government building, infrastructure,... billions of dollars the Communications Security are being spent on opaque and Establishment (Weston, 2015). Other examples include the CSE’s annual apparently ineffective surveillance budget of $829 million and Canada’s programs. Department of National Defence As the graph shows below, budget of CA$24.495 billion researchers at George Mason (SIPRI, 2011). The objective costs University estimated the cost of of surveillance programs amount the American War on Terror to be to transfer payments from productive US$1.7 trillion since 2001. Although sectors of the economy to public the American government releases bureaucracies and government information on the annual budget contractors. Instead of taxpayer of intelligence spending, these funds supporting education, reports do not describe how the full health, infrastructure, or simply not budget is used. The only information being extracted from the private we have about the allocation of sector in the first place, billions these funds comes from the “black of dollars are being spent on budget” leaked by Edward Snowden opaque and apparently ineffective in 2013. According to the black surveillance programs.
Estimated WarEstimated Funding War by Agency, Funding FY by 2001 Agency, - FY 2015 FY 2001–FY 2015 $200 195 billion DOD 170 165 State & USAID 157 159 VA Medical 124 130 108 96 100 $100 95 74 74 budget authority
36
$0 FY01–2 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 Cumulative Enacted DOD $35 $71 $74 $104 $118 $164 $189 $150 $155 $151 $115 $87 $85 $64 $1,562 bn
State & USAID $1 $4 $22 $5 $5 $5 $5 $5 $9 $5 $11 $9 $6 $9 $101 bn
VA Medical $0 $0 $0 $0 ** $1 $1 $1 $2 $2 $3 $3 $4 ** $17 bn
Total $1,680 bn Source: Amy Belasco, CRS, "The Cost of Iraq, Afghanistan, and Other Global War on Terror Operations Since 9/11," Dec. 8, 2014. FY 15 data comes from US Senate Committee on Appropriations, "Summary: Fiscal Year 2015 Omnnibus Appropriations Bill," Dec. 9, 2014. Produced by Veronique de Rugy and Rizqi Rachmat, Mercatus Center at George Mason University.
24 FRASERINSTITUTE.ORG budget, U.S. spy agencies received information. Even if it could be US$52.6 billion in 2013 (Delong, shown that privacy violations 2013). However, this document only increase public safety, people pertains to one year, and it does vary greatly in how they prioritize not include all military surveillance privacy or security. For example, expenditures. some individuals could incur what Although it is difficult to compare Ludwig von Mises referred to as a the objective costs and benefits of “psychic profit” from surveillance (Mises, 2007). A psychic profit (or surveillance, individuals can conduct loss) is a concept that describes an analysis of their own personal, an increase (or a decrease) in an subjective costs and benefits. individual’s utility or happiness. An Subjective valuation refers to the individual may prioritize surveillance idea that the value of a good or over privacy because surveillance service is determined by each acting provides a sense of safety. This is individual instead of how much labor an example of a subjective benefit went into the good’s production because the sense of security offered (Menger, 1950). Each individual is not worth the same amount for desires a good or service according everyone. In comparison, subjective to their personal ranking of ordinal costs include the value that each values (Mises, 2007). Subjective individual places on their loss of valuation makes it impossible for privacy due to unwarranted data another party to precisely measure collection, domestic drones, and an increase or decrease in an intrusive law enforcement agents. individual’s utility. Subsequently, it Some individuals may be willing to is impossible to compare changes in pay their full salary for a reduction in utility between individuals. Therefore, terrorism. Others might prefer it is impossible for governments to to fund the construction of new quantify the subjective valuation that school instead. an individual gives to reducing his or her probability of death from a terrorist attack. The innate human drive for survival Researchers cannot quantify utility; will always generate demand however, individuals can decide for security. However, different how much they value surveillance individuals will demand different based on their unique preferences. types of protection. The innate human drive for survival will always generate demand for security. However, different Since policy makers cannot measure individuals will demand different the subjective valuations of their types of protection. Similarly, the constituents, the subjective valuations costs that individuals will be willing of all of the citizens cannot be to pay will vary, and furthermore an aggregated. The theoretical tools individual’s demand and willingness that central planners use to quantify to pay will also fluctuate throughout and aggregate individual subjective his or her life in response to new valuations rely on the assumption that
CANADIAN STUDENT REVIEW WINTER 2016 25 the measurement, aggregation, and lives should be saved from terrorism comparison of subjective valuations, even at great cost to taxpayers. or utility, is possible. Government Furthermore, terrorism has increased agencies, such as the Department since the “War on Terror” officially of Transportation (DOT), conduct began in 2001. According to the quasi cost-benefit analyses of Global Terrorism Database maintained various programs by comparing the by the University of Maryland, estimated number of lives saved to terrorist attacks worldwide initially the objective cost of implementation plummeted from roughly 5,000 (Thomson and Monje, 2015). The incidents annually during the 1980s to most common measurement that 900 incidents in 1998 before steadily government agencies use to quantify increasing after 2004 to new record the value an individual places on a highs today. Although more research marginal change in their likelihood of is required for understanding the death is the Value of a Statistical Life triggers of terrorism, the data confirm (VSL). In 2015, the DOT estimated that terrorism is increasing despite an individual’s life to be $9.4 million surveillance efforts worldwide. on average; however, this assumes that all lives have the same value and that each individual values their The data confirm that terrorism life to be worth $9.4 million. VSL is increasing despite surveillance estimates are unreliable because they efforts worldwide. depend on Willingness to Pay (WTP) estimates, which vary according to the assumptions used in the economic Independent researchers posit that model. For example, the DOT’s WTP cheaper and more efficient ways of estimate assumes a linear relationship combating terrorism are available. between risk and WTP for avoidance One solution may be to engage of the risk (Thomson and Monje, in “defensive defense” instead of 2015). Since these tools are unable “offensive defense.” Political scientist to accurately measure individual Robert Pape studied the impact of subjective preferences, governments military intervention by NATO or cannot conduct thorough cost- the US on the number of terrorists benefit analyses. Without a cost- originating from the Middle East benefit analysis of government (Pape, 2006). Based on data from surveillance, governments cannot 315 suicide attacks between 1980 and verify that surveillance effectively 2003, Pape found that most terrorists prevents terrorism. were motivated by nationalism and Since September 11, 2001, 67 occupation of their homeland instead Americans have died in terrorist- of poverty or Islamic fundamentalism. related acts on U.S. soil, yet billions of Following this research, economist US taxpayer dollars are being spent Jean-Paul Azam briefed the Obama on the War on Terror (University administration on the impact of of Maryland, 2015). This illustrates “boots on the ground” in oil producing that surveillance programs implicitly countries. Azam made the simple function under the assumption that all suggestion that removing US soldiers
26 FRASERINSTITUTE.ORG Terrorism Increased After Launch of War on Terror
5,400
4,500
3,600
2,700
1,800
900
1973 1991 1970 1976 1979 1982 1985 1988 1995 1998 2001 2004 2007 2010
University of Maryland (2015). Global Terrorism Database. Various database searches.
from foreign countries could greatly benefits that they personally incur. diminish the probability of terrorist Each individual must decide if the attacks targeted at the US (Azam and sense of security that surveillance Thelen, 2014). provides is worth the reduction in If terrorists were constantly attacking personal privacy endured. us and the only way to survive was to be monitored by government agencies, it might be worthwhile to trade privacy for security. However, the assumption that national security requires any abridgment of rights Demelza Hays is a Frédéric is obfuscated; that it requires vast Bastiat Fellow at the Mercatus invasions of privacy is without Center in Arlington, Virginia. warrant given the existence of more She graduated from the Toulouse School of Economics effective alternatives, including in France with a M.A. in removing troops from the Middle Economics in 2015, and she is East. Although the government currently completely her PhD cannot conduct a proper cost- in Economics at the University of Liechtenstein. benefit analysis of bulk data collection, individuals can conduct an analysis of the subjective costs and
CANADIAN STUDENT REVIEW WINTER 2016 27 REFERENCES Pew Research Center (2015). Americans’ Views on Government Surveillance Programs. Pew Research Centers Internet American Life Project RSS (March 16). Pew Research Center. Azam, Jean-Paul, and Véronique Thelen (2013, April). The Geo-Politics of Foreign Aid and Transnational Terrorism. Revue d’Économie du Développement 27:165-192. Clarke, Richard A., Michael J. Morell, Geoffrey R. Stone, Cass R. Sunstein, and Peter Swire (2013, Dec. 12). Liberty and Security in a Changing World. The President’s Review Group on Intelligence and Communications Technologies.
28 FRASERINSTITUTE.ORG The Fraser Forum blog: expert analysis of issues that matter most Visit: www.fraserforum.org To read posts on other interesting policy issues from leading policy experts, please visit www.fraserforum.org ››
THIS ARTICLE APPEARED IN THE FRASER FORUM ON NOVEMBER 18, 2015
HISTORIC COURT RULING ALSO RAISES QUESTIONS FOR FIRST NATIONS PURSUING ABORIGINAL TITLE Ravina Bains
n mid-October, as noted in a a damages claim without having recent study, the Supreme Court proven aboriginal title. Allowing the of Canada upheld an earlier B.C. Nechako Nations to do so could ICourt of Appeal ruling that will allow result in future aboriginal title the Nechako Nations (Saik’uz First litigation between First Nations and Nation and Stellat’en First Nation) private parties—litigation that was to bring forward a damages claim previously only brought against against Rio Tinto, an aluminum governments. industry giant. The First Nations claim that the These are important questions Kenney Dam (pictured on next page), to ask because it could mean an which has operated for more than additional 20 years of litigation. 60 years on the Nechako River, is causing significant environmental In addition to exposing private harm to the river and thus negatively parties to litigation that was affecting their fishing resources. previously only brought against The Nechako Nations are claiming governments, this judgment will aboriginal title on the land, which also impact economic development houses the Kenney Dam, however opportunities in places like British they have yet to prove title to the Columbia where the number one land. This judgement allows the First impediment for mining investment is Nation to move forward with uncertainty over disputed lands.
30 FRASERINSTITUTE.ORG Furthermore, for First Nations pursing which is not only costly for the First aboriginal title claims, this case raises Nation but could add another decade several fundamental questions. before they are granted title from For example, if First Nations are now governments. able to prove aboriginal title on land Through this recent decision, the through litigation against private Nechako Nations now have the parties, will governments recognize opportunity to pursue a damages that title? Or will governments require First Nations to re-litigate the claim against Rio Tinto and prove case against the Crown? aboriginal title to their claimed territory in the process. These are important questions for First Nations, like the Nechako It remains to be seen if they will move Nations, to ask because it could mean forward with this claim; but before an additional 20 years of litigation. they do, the Nechako Nations ought to seek clarity on these important For example, the Tsilhqot’in title questions. case—the 2014 historic decision granting title for the first time on Read the full study ›› land outside a reserve—took more than 20 years to conclude. So if the provincial or federal governments do not recognize aboriginal title granted Ravina Bains is the Associate through litigation between a First Director of the Centre for Nation and private party that could Aboriginal Policy Studies at mean First Nations would have to re- the Fraser Institute. litigate their case against the Crown,
CANADIAN STUDENT REVIEW WINTER 2016 31 INFOGRAPHIC OIL AND GAS SECTOR LOSING CONFIDENCE IN ALBERTA AS A PLACE TO INVEST
Investor confidence is shaking Due to Alberta’s policy uncertainty
FISCAL TERMS AND ROYALTIES 2014 RANKINGS 2015 RANKINGS
14% 39% 16. ALBERTA deterrent deterrent
2014 2015
ENVIRONMENTAL REGULATIONS
38% 52% 38. ALBERTA deterrent deterrent
2014 2015
32 FRASERINSTITUTE.ORG FROM THE ARCHIVES CANADA’S PHYSICIAN SUPPLY Doctor-to-population ratio will decline unless Canada becomes more reliant on foreign-trained physicians
Nadeem Esmail
CANADIAN STUDENT REVIEW WINTER 2016 33 THIS ARTICLE APPEARED IN THE NOVEMBER 2008 ISSUE OF FRASER FORUM
Table 1: Age-adjustedTable 1: Age-adjusted comparison of Figure 1: Canadian physician-to-population ratio, 1961 to 2017 n recent years, Canadians comparison of physicians per have been paying a significant physicians per 1,000 population for select OECD1,000 population countries, for 2006 select 2.5 amount of attention to the supply OECD countries, 2006 Iof physicians in Canada. Reports Projections and commentaries on the issue of Rank Country of 28 physician supply appear regularly in 2.0 Iceland the nation’s news media, while studies on the issue have been produced by Greece (2005) research organizations, professional Netherlands 1.5 associations, and government Czech Republic committees across the country. Most Norway Physician-to-population ratio of these discussions and studies have Belgium come to the conclusion that there Ireland 1.0 are too few physicians practicing in 1961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011 2016 Slovak Republic (2004) Canada today. Sources: AFMC (2007); McArthur (1999a); OECD (2008); and Ryten et al. (1998); calculations by author. Switzerland
That conclusion is supported by Denmark (2004) the available evidence regarding Austria Canadians’ unmet health care needs Spain and the relative supply of physicians in this country. For example, in France 2007 slightly less than 1.7 million Sweden (2005) Canadians aged 12 or older reported Australia (2005) being unable to find a regular Italy physician (Statistics Canada, 2008). Germany Similarly, a research poll completed Portugal (2005) in 2007 found that 14% of Canadians (approximately five million) were Hungary without a family doctor, more than Luxembourg 41% of whom (approximately two New Zealand million) were unsuccessful in trying to Finland find a family doctor (CFPC, 2007). Korea Poland UPDATE United Kingdom In 2013, Canada’s physician to Canada population ratio was 2.6 per Japan 1,000 population, ranking Canada Turkey
24th among the 28 countries Note: Figure for Turkey was not age adjusted included in Table 1. Canada’s rank due to a low 65+ population not conducive to does not change after adjusting meaningful adjustment. Sources: OECD (2008); Esmail and Walker (2007); data for age. calculations by author. Source: OECD 2015, calculations by Bacchus Barua
34 FRASERINSTITUTE.ORG Further, after accounting for the Canada’s physician supply may fact that most other developed evolve in the coming years. nations have a greater proportion of seniors (aged 65 and older), and THE EVOLUTION OF thus a greater demand for health CANADA’S PHYSICIAN SUPPLY care services (nations with younger In the early 1970s, Canadians populations naturally require fewer enjoyed one of the highest health services),1 Canada’s physician- physician-to-population ratios in to-population ratio in 2006 ranked the developed world (OECD, 2008). 26th among the 28 developed Such generous relative access nations that maintain universal to doctors was, in light of recent access health insurance programs evidence, unquestionably beneficial for which data were available (table for Canadians. Unfortunately, in the 1) (OECD, 2008; Esmail and Walker, early to mid-1980s some government 2007; calculations by author). officials voiced concern about the generous and growing number of These facts, when combined with physicians, and recommended that evidence that increased spending on governments reduce the number physicians has been related to reduced of medical school admissions and wait times for treatment in Canada training positions available (Tyrrell (Esmail, 2003), clearly suggest that and Dauphinee, 1999). While their the supply of physician services in calls for reform were not met with a Canada is not meeting the demand. specific policy on physician supply, medical school admissions were This article seeks to add to the reduced slightly in the years that current understanding of Canada’s followed (Tyrrell and Dauphinee, physician shortage and show how 1999; Ryten et al., 1998).
Figure 1: Canadian physician-to-population ratio, 1961 to 2017 Table 1: Age-adjusted Figure 1: Canadian physician-to-population ratio, 1961 to 2017 comparison of physicians per 1,000 population for select 2.5 OECD countries, 2006 Projections Rank Country of 28 2.0 Iceland Greece (2005) Netherlands 1.5 Czech Republic Norway Physician-to-population ratio Belgium Ireland 1.0 1961 1966 1971 1976 1981 1986 1991 1996 2001 2006 2011 2016 Slovak Republic (2004) Sources: AFMC (2007); McArthur (1999a); OECD (2008); and Ryten et al. (1998); calculations by author. Switzerland
Denmark (2004) Austria Spain CANADIAN STUDENT REVIEW WINTER 2016 35 France
Sweden (2005) Australia (2005) Italy Germany Portugal (2005) Hungary Luxembourg New Zealand Finland Korea Poland United Kingdom Canada Japan Turkey
Note: Figure for Turkey was not age adjusted due to a low 65+ population not conducive to meaningful adjustment. Sources: OECD (2008); Esmail and Walker (2007); calculations by author. In the early 1990s, however, specific ratio that increased continuously from policies on physician supply were the early 1960s to the late 1980s, introduced following the publication peaking in 1993 at 2.1 physicians of what has come to be known as per 1,000 people. (The projections the Barer-Stoddart report. In 1991, included in this figure will be researchers Morris L. Barer and Greg discussed later in this article.) Since L. Stoddart published a discussion then, Canada’s physician supply has paper for the Federal/Provincial/ been growing just fast enough to Territorial Conference of Deputy maintain a ratio of 2.1 physicians per Ministers of Health. Their report 1,000 people (except in 1997, when recommended, among other things, the ratio fell to 2.0), now one of the reducing medical school enrollment lowest ratios among nations that by 10%; reducing the number of guarantee their citizens access to provincially funded post-graduate health care insurance regardless of training positions by 10% to meet ability to pay (table 1). In other words, the needs of students graduating Canada’s policies have restricted with M.D.s in Canada; and reducing the growth rate of the phy sician-to- Canada’s reliance on foreign- population ratio in order to maintain trained doctors over time (Barer a level that is now below what and Stoddart, 1991). Governments other nations provide through their responded in 1992 by accepting all universal access health programs, three of these recommendations, with and below the current demand for the goal of maintaining or reducing physician services in Canada. the physicianto- population ratio in Canada (Tyrrell and Dauphinee, 1999). The potential health benefits associated with having a higher Figure 1 reveals the effect of these physician-topopulation ratio (see, for decisions: a physician-to-population example, Or, 2001, and Starfield et al.,
Figure 2: First-yearFigure 2: Firs enrollmentt-year enrollment in Canadian in Canadian faculties of medicine, 1994-95 to 2006-07faculties of medicine, 1994-95 to 2006-07
2,500
ude nts 2,000
1,500 Medical school st
1,000
Source: AFMC (2007).
Figure 3: Location and professional activity of 1989 36 FRASERINSTITUTE.ORGCanadian medical school graduates in 1995-1996
In practice In training Inactive
136
1,300 Medical school graduates
55 216 2 13 In Canada Outside Canada 2005) were lost as a consequence of the number of physicians entering these restrictions. the workforce over the next seven to Figure 2: First-year enrollment in Canadian 10 years (the amount of time it will faculties of medicine, 1994-95 to 2006-07 While it is clear that the current take for these students to become physician supply is insufficient, practicing doctors in Canada). 2,500the numbers to the left of the It is also important to consider projections marker in figure 1 tell us what will happen to the physician nothing of the future. According to supply over that time in order to ude nts 2,00recent0 statistics published by the better understand the impact that Association of Faculties of Medicine government controls have had on 1,500of Canada, provincial governments medical school admissions and have been increasing the number post-graduate training during the
Medical school st of medical school admissions late 1990s and the early part of this 1,00significantly0 over the last six or decade. seven years (figure 2). In order to better understand how Canada’s physician supply will evolve over GRADUATION RATES AND the coming years, it is important to PHYSICIAN SUPPLY TO 2017 consider the impact these changes Extrapolating from Canada’s medical in school admissions will have on Figure 3: Location and professional activity of 1989school graduation rates, it is possible Canadian medical school graduates in 1995-1996to estimate the number of new doctors who will be entering the Figure 3: Location and professional workforce in the coming years. To activity of 1989 Canadian medical estimate the future supply of doctors school graduates in 1995-1996 accurately, however, it is important In practice In training Inactive to take into account the number of physicians currently working in Canada who will die, retire, or leave for employment in other nations, as these physicians must be replaced in 136 order to maintain a constant supply of physicians over time. An article published in the Canadian Medical 1,300 Association Journal sheds some light on both issues.
In early 1996, Ryten et al. followed up Medical school graduates with 1,722 medical school graduates (from an entry class of approximately 55 1,780) who received their degree 216 2 in 1989 (leaving them sufficient 13 time to complete post-graduate In Canada Outside Canada medical training). They found that only 1,300 of the graduates were Source: Ryten et al. (1998). actively practicing in Canada seven
CANADIAN STUDENT REVIEW WINTER 2016 37 years after graduation. A further who either retired or died, and that 216 were still training to practice in roughly 300 to 350 new physicians Canada, while 13 students remained would need to be added in order to in Canada but were not in active replace those physicians who left the practice. Meanwhile, 193 had left the country. In other words, maintaining country (figure 3). In total, only 88% the physician-to-population ratio in of those who graduated in 1989 were the mid 1990s would require adding practicing or training to practice as 1,900 to 2,200 new physicians to Canadian physicians in 1996. the workforce every year (between 3.1% and 3.6% of the 1996 physician Ryten et al. also found that the population)—a substantially greater number of Canadian-trained number than the 1,516 new Canadian- physicians entering the workforce trained additions (who were either in was insufficient even to maintain practice or still training to practice in the current supply of doctors at that Canada) from the class of 1989. time. In the mid-1990s, the authors estimated that approximately 650 By applying the proportions to 750 new physicians would be determined by Ryten et al., as has needed each year in order to keep been done previously by McArthur up with historical rates of population (1999a), to the number of students growth (the physician supply must who enrolled in medical schools grow with the population in order in Canada and the number of to maintain a constant ratio). The students who were awarded M.D.s authors also determined that a from 2000 onwards, it is possible further 900 to 1,100 physicians to estimate the number of new Figurewould 4: be New needed Canadian-graduated to replace thosedoctors in practiceCanadian- compared trained physicians who to the number of new doctors required to maintain physican-to- population ratio, 1995 to 2017 Figure 4: New Canadian-graduated doctors in practice compared to the number of new doctors required to maintain physican-topopulation ratio, 1995 to 2017
2,500
Physicians required
2,000 Physicians 1,500 Physicians added
1,000 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
Sources: AFMC (2007); McArthur (1999a); OECD (2008); and Ryten et al. (1998); calculations by author.
by author.
38 FRASERINSTITUTE.ORG will be entering the workforce up to account the effects of demographic 2017.2 As figure 4 shows, if 88% of changes in the physician workforce, medical school graduates are part the consequence of which may be of Canada’s physician supply seven that, in the future, more physicians years after graduation, and if only will be required to deliver the same 97% of those admitted to medical volume of services being provided school graduate (as was the case today (see, for example, Esmail, for the class of 1989), then current 2007). Furthermore, this is only the enrollment and graduation rates number of new physicians required suggest that only 2,095 Canadian- to maintain the stock of physicians, trained students will be added to the which is clearly insufficient Canada’s physician supply in 2017. physician supply to meet current demand and will fall well short of Figure 4 also shows the number of demand in the future given that new physicians required to maintain Canada’s health needs will increase the physician-to-population ratio. as our population ages. This number exceeds the number of Canadiantrained physicians entering Making one additional assumption— the workforce every year through that the Canadian population will 2017, though this difference is small continue to increase at its average in 2017. This number of physicians growth rate since 1990 (~1.0%)— required assumes that the number allows us to estimate how the needed to replace those lost to physician-to-population ratio will death, retirement, or emigration, evolve in Canada in the coming and to keep up with population years (figure 1). Clearly, without growth is a constant 3.3% of the a significant addition of foreign- current physician population over trained doctors, the Canadian time (which is equal to the addition physician-topopulation ratio will 5 of 2,000 new physicians in 1996, the decline between now and 2017, just low-middle point in the Ryten et al. as it would have through the 1990s estimates above).3 It also assumes if foreign physicians had not been that only Canadian-trained doctors used to make up for the shortfall will be added to the physician supply caused by insufficient medical school between 2006 and 2017.4 admissions.
This replacement rate is a CONCLUSION conservative estimate: at present approximately 35.9% of Canada’s The current physician supply in physicians are aged 55 or older Canada is clearly insufficient to (CMA, 2008), which suggests that meet the demand for physician the number of physicians needed care under the present structure of to replace those who retire or Medicare,6 and falls well short (in die (900 to 1,100 doctors in the terms of the supply of physicians mid-1990s) will rise significantly relative to population) of what is in the coming years. In addition, being delivered in other developed this estimate does not take into nations that also maintain universal
CANADIAN STUDENT REVIEW WINTER 2016 39 approaches to health care insurance. graduating in 1989. All graduation and Without a significant intake of enrollment rates are from AFMC (2007). foreign physicians, the physician- 3 This replacement value is smaller than to-population ratio will fall in the the 3.5% estimate of physicians leaving coming years because there are not practice in Canada annually (not counting enough new doctors being trained the number of physicians required to in Canada. It would seem that a account for population growth) used by Tyrrell and Dauphinee (1999) to estimate government-imposed limitation changes in the physician supply. on the number of physicians being trained in Canada is a policy choice 4 This second assumption may seem that is not serving the best interests questionable since significant numbers of foreign- trained physicians have been of Canadians, be they patients in added to the Canadian workforce in need of a physician or capable order to maintain the existing physician- students who wish to become to-population ratio. However, the precise doctors but are unable to access number of foreigntrained doctors who medical training in this country. will be added in the future is difficult to estimate. This assumption does not, however, affect the conclusions of this examination. Since the main purpose of this article is to consider the Nadeem Esmail is a Senior effect controls have on the supply of Fellow of the Fraser Institute. Canadian-trained doctors, this simplifying He first joined the Fraser assumption serves to clarify the effect Institute in 2001, served as these training restrictions have on the Director of Health System future supply. Performance Studies from 2006 to 2009, and for the past 5 This decline in the ratio is seen in figure 4 three years has been a Senior as the decline in the number of physicians Fellow. Esmail completed his required to maintain the physician-to- B.A. (Honours) in Economics at the University of Calgary population ratio between 2006 and 2017. and received an M.A. in 6 Shortages can only occur when prices are Economics from the University of British Columbia. not permitted to adjust. Prices will naturally rise in any functioning market where goods or services are in short supply relative to NOTES demand, thus encouraging new supply and reducing demand simultaneously. 1 The methodology used for age-adjustment The outcome is equilibrium of supply here is that employed by Esmail and and demand (no shortage or excess). In Walker (2007). the Canadian health care marketplace, such adjustment is impossible because of 2 This estimate uses graduation rates for restrictions on both the prices and supply students awarded M.D.s between 2000 of medical services. The optimal solution and 2007 (who, between 2007 and 2014 to Canada’s shortage is obviously to will be at the same point in their careers remove restrictions on training, practice, as the students studied by Ryten et al.), and pricing, and to introduce user charges. and enrollment rates for students entering This would increase the supply of services medical school between 2004/2005 and while simultaneously encouraging more 2006/2007 who will, in general, be at informed use of medical practitioners’ time the same point in their medical careers (thus reducing the demand for treatment between 2015 and 2017 as the students overall and improving the allocation of studied by Ryten et al. were in 1996 after physician manpower and effort). Such a
40 FRASERINSTITUTE.ORG change in policy would bring Canada more in OECD Health Statistics 2015 — Frequently line with some of the world’s top-performing Requested Data. http://www.oecd.org/health/ universal access health care programs health-systems/OECD-Health-Statistics- (Esmail and Walker, 2007). Unfortunately 2015-Frequently-Requested-Data.xls, as of for Canadians, the introduction of user fees November 15, 2015. and extra billing are not permitted under the current federal legislation guiding Medicare. Or, Zeynep (2001). Exploring the Effects of The analysis here takes the current legislation Health Care on Mortality across OECD as given and discusses only the supply Countries. Labour Market and Social Policy of physicians. – Occasional Papers No. 46. OECD.
CANADIAN STUDENT REVIEW WINTER 2016 41 rade, rity, T Techn spe olo ro gy P , E du ca t io n , H e Explore Public a l t h c a r e Policy Issues ,
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42 FRASERINSTITUTE.ORG What’s New from HOT the Institute TOPICS
TOWARD FREE TRADE IN CANADA 5 Things the Federal Government Can Do to Open our Internal Market
Harmonize Achieve mutual apprentice training recognition of Allow requirements product and service inter-provincial trade within three years standards. in dairy products.
Coordinate a Establish a path single, national towards free corporate registration trade in energy products system for ease of business reporting.
CANADIAN STUDENT REVIEW WINTER 2016 43 What’s New from HOT the Institute TOPICS
ollowing the conclusion of 3. Create a single negotiations for the national system for 12-nation Trans-Pacific corporate registration FPartnership (TPP) trade agreement and reporting. Such a and the Comprehensive Economic system will facilitate and Trade Agreement (CETA) with greater investment by the European Union, Canada can also foreign and domestic increase its global competitiveness enterprises in the by liberalizing interprovincial trade Canadian market and and commerce. This report outlines eliminate costly five key areas for action for freer duplication. trade among Canadian provinces. The sooner the country takes these 4. Promote market steps, the sooner it will reap the access and regulatory many benefits. coherence in provincial energy and 1. Strengthen the environmental policies institutional framework to help promote of the Agreement on sustainable growth. Internal Trade (AIT). The first focus should 5. Encourage dairy exports be on expanding the and the establishment secretariat. of a common Canadian market to enable Canada 2. Implement policies to benefit from growing that facilitate greater global demand for dairy labour mobility products. between provinces and harmonize Read the report ›› apprenticeship and training programs. Taking these steps will help deploy skilled workers when and where they are needed.
44 FRASERINSTITUTE.ORG What’s New from HOT the Institute TOPICS
MANAGING THE RISKS OF HYDRAULIC FRACTURING: AN UPDATE
ctivist groups continue to environmental risks related to oppose hydraulic fracturing, hydraulic fracturing (or ‘fracking’), a new application of old the practice of injecting sand, water, Atechnologies that is unlocking vast and a relatively small quantity of supplies of oil and natural gas in chemicals deep underground at high the United States and Canada. pressures to extract fossil fuels, and This opposition has resulted in the spotlights the latest government and establishment of moratoria in several academic research about the actual Canadian provinces, preventing the effects of fracking. extraction of resources that could ›› provide Canadians with significant Read the study benefits. This study examines the
Impacts on air
Water requirements Risk to surface and groundwater Well integrity and fracturing induced stress
Induced seismicity
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