The Fraser Intsitute:
Right on Target

An Institution

The Fraser Institute was founded by Michael Walker in 1974 and quickly gained a comical reputation for its extreme right-wing views. Commonly dismissed as a “right-wing think- tank,” they initially had no visible impact on public opinion until recent years, as the political climate has changed. With the increasing corporate control of Canada’s news media, and the populace in a frenzy over a spectre called The Deficit, the Fraser Institute’s agenda to promote a totally free-market system is gaining greater approval as it reaches a wider audience. Their campaigns have become increasingly complex and their image has been modified from frothing neo-conservative cultists, to an organization of (self-appointed) “experts” with something to say about most current issues: from unemployment, to the environment, to the free trade agreements. The Institute has become adept at making arguments couched in seemingly rational, objective phrases, but upon closer analysis, the solutions they offer are clearly inconsistent, and in many cases, Victorian.

It all began in ‘74 when Walker, a right-wing economist from the University of Western Ontario, received financial backing from forestry giant MacMillan-Bloedel, largely to counter the elected NDP provincial government of Dave Barrett. Thus was the Fraser Institute spawned. Mac-Blo was soon joined by a host of other corporate sponsors, which, by the mid-1980’s, included the Power Corporation, Southam Inc., Thomson Newspapers, The Molson Companies, BC Timber, Dow Chemical, Dupont, Imperial Oil, Proctor and Gamble, Canadian Tire, BC-TEL, Bell Canada, Boise-Cascade, Kraft Foods, the banks of Nova Scotia, Montreal, Royal Bank, Toronto Dominion Bank, CIBC, Wood Gundy Ltd., McDonalds and Irwin Toys. With such powerful friends as these providing 40% of the Institute’s annual budget (over $2 million), the FI was well on its way to public prominence. Today they have offices in Toronto and Seattle, and headquarters in Vancouver.

The FI has an open mandate to “redirect attention to the use of competitive markets as the best mechanism for responding to change.” This boils down to a philosophy in which an entirely free market system is the best solution to society’s ills, no matter what those may be, and the FI has gone to great lengths to promote this view in many different contexts. It is a view (admittedly) derived from Adam Smith’s economic theories of the 1700’s.

Smith was a firm believer in the “invisible hand,” or what the FI now calls “market discipline.” That is, in a totally free market, consolidation of power by the few would be prevented by natural market forces. Smith believed that market interactions were led by an invisible hand, ultimately resulting in good for all. This helping-hand was provided by a harmonious natural order divined by God.

Walker defends his 18th century viewpoint by observing, “People say to me, ‘You’re applying the ideas of Adam Smith, who wrote in 1776, how can they be relevant to the 1980’s?’ I point out that Newton wrote in the 1650s and that doesn’t change the validity of the rules of motion in the universe.” Newton’s theories of force and motion, however, have been tested and verified in laboratories, whereas Smiths’ ideas concern the less predictable realms of economics, people and societies. These tend to change over time.

SFU economics Professor M. Lebowitz points out that Smith’s 18th century economic system had little in common with today’s world of monopolies and huge corporations. Smith could not conceive of such entities existing without government intervention. Lebowitz notes that in order to recreate Smith’s world, we would have to break up all the large companies of today. Ironically, it is these large companies that provide 40% of the Fraser Institute’s funding, and effectively control most markets--a control made possible by lack of appropriate government regulation.

Public Relations and Debt Hysteria

The Fraser Institute has launched a complex public relations campaign to promote its radical vision of free trade. They commission polls and publish reports, economic analyses, brochures, news releases and an array of free-enterprise propaganda. With a 1993 staff of 24 and budget of $1.5 million, they can afford to be prolific. More than 350 writers have contributed to institute publications which have been sold in 54 countries. They even have multiple departments producing “literature” on everything from media balance (On Balance), to religion and economics, to a board game called Poleconomy; and in 1993 their publication, What Everyone Should Know About Economics & Prosperity, was adopted as a textbook in some Canadian high schools, as well as internationally.

Some of the titles which Walker has authored for the media include: “Medicare Plan just like scams of Jim Bakker” (in the Financial Post Daily); “Selling Self Interest;” “Public Property? the habitat debate continued...;” and in a 1990 Readers Digest, “Why the national debt should alarm you.” Indeed, the FI has played an important role in convincing us that the national debt should be of primary concern, when previously nobody gave it much thought. To put today’s debt in context, note that in 1946, right after WW2, the Canadian national debt was about two thirds, per capita, what it is now. The debt hysteria which presently exists was created, in part, by the Fraser Institute due to their repeated publications and articles on the subject. When their angle was picked up by the media, it allowed the FI to spring- board from the panic they helped generate to push for less government control and more free markets.

The FI also specializes in coining ideologically loaded new phrases and then attacking these ill-defined entities. “The deficit/debt problem is a political structure predicament,” they state in one of their annual economic Report Cards issued to the provinces. “Deficit spending is an outgrowth of unrestrained democratic politics.” By “unrestrained democratic politics,” they mean any instance in which politicians downplay market interests when making economic decisions, and allow themselves to be swayed by the interests of the populace. A system in which stocks & bonds have a greater right to freedom than do people may seem strange, yet it is one of the many self-contradictions to which the FI’s logic leads.

In public debates, Institute representatives typically avoid answering any challenging questions. Irrelevant points are commonly introduced to direct the discussion down tangential paths. A classic example of this strategy was Walker’s 1987 Free Trade Arrangement (FTA) debate with historian David Orchard, author of The Fight For Canada. Walker’s opening statement, “Let’s talk about the reason we originally sought this deal,” attempted to sidetrack the discussion from the actual debate, which was over the details of the final FTA document.

A similar move was made by FI policy analyst, Fazil Mihlar, when he gave a presentation at SFU in 1995, entitled “The Negative Consequences of Employment Equity.” Clearly out of the realm of the talk, Mihlar stated that NAFTA had increased the number of employed people in Canada. Once pushed on the issue, he finally agreed that this was false and that the unemployment rate had, of course, increased.

Media Coverage

In 1993, the Fraser Institute commanded a total of almost 90 minutes on CBC and CTV’s national newscasts and granted over 600 media interviews. Their voice is clearly reaching a large number of Canadians through the mass media, and few opposing viewpoints are being offered.

This may have something to do with the fact that Conrad Black (co-chair of Southam Inc.) is an FI member. Southam Inc. and Thomson Corp. (another FI sponsor) account for 90% of papers purchased in BC, and a majority of newspapers in Canada. It is unsurprising that a think-tank which supports unrestrained corporate control of the market finds almost unlimited access to the corporate-owned media. Indeed, in 1981, a memo was issued to all the daily papers of the Sterling Newspaper Chain (controlled by Black), clearly stating that they would soon receive the first of two columns by Michael Walker and carrying instructions to run them “within a week of receipt.”

Such overt control of ownership over newspaper content has worked in the FI’s favour; this memo resulted in Michael Walker’s right-wing message being piped directly into at least 12 communities, in papers which the community identifies as their own voice. This is not an isolated incident. Jim Sinclair, a former editor and reporter at Sterling’s Nelson Daily News has seen this control up close, and states, “the media fundamentally created Micheal Walker and the Fraser Institute.”

Of course, the FI has published its own right-wing critiques of the press, but this is more of an example of nibbling the hand that feeds them rather than posing any serious criticisms. Their own media watching group which produces On Balance uses “content analysis” to determine how balanced or unbalanced they believe the news coverage to be. Interestingly enough, they found that environmentalists are quoted twice as often as scientists. Presumably there are no scientists who can be considered environmentalists. They also claimed that media coverage [CBC TV news and the Globe and Mail] was imbalanced against the FTA. In this study, On Balance excluded both the Globe and Mail’s Report on Business, and its editorials. These constituted some of the most positive coverage of the FTA in the country at the time, as Lorne Slotnick, a former Globe & Mail labour reporter attests: “At the Globe there was an outright effective ban on stories that made the free trade deal look bad, reporters were told and were subtly made to feel that stories that made the free trade deal look bad were not welcome in The Globe and Mail.”

Excluding major news sources which contradict the initial hypothesis that the news media is anti-FTA would, and did result in a greatly misleading analysis. On Balance states that the content analysis they were performing was a “completely objective analysis.” SFU communications Professor and leading expert in content analysis studies Bob Hackett points out that content analysis is an inherently subjective method of analyzing media. One can obtain virtually any result one wishes. Indeed, by accusing the press of being too left-liberal, the FI provides their corporate buddies like Black and Thomson a convenient excuse to swing their newspaper content further to the right, thereby justifying greater coverage of organizations like the FI. It is an arrangement whereby everybody (who matters) is happy.

Attack on the Social Security System

The FI takes an active role in attempting to dismantle welfare and UI while advocating privatization of medical care, education, and the penal system. As the FI’s senior economist, Walter Block condemned minimum wage as “immoral” and protecting people with low productivity. Such peoples, unworthy of even $1 per hour, were identified by Block (in 1983) as “uneducated, unskilled, alcoholics, unreliable workers, teenagers, native peoples, downtrodden ethnic and national peoples, the physically and mentally handicapped.”

Fraser Institute publications recommend the replacement of all social programs with charity. This could be a realistic solution in a world of altruistic and benevolent transnational corporations, but it is sadly inapplicable to this Earth. Of course corporations have been generous to the FI, especially considering their charitable tax status; as a registered charitable society, corporations and individuals can and do donate money to the FI as a tax write- off.

The Environment

The Fraser Institute will say anything which they think will lead to free markets, no matter how ridiculous or dangerous. They repeat how free trade will lead to greater environmental protection and prevent excessive deforestation and excessive fishing.

It is the unchallenged power of the multinationals that is allowing the destruction of Canadian wilderness at the rate of 240 acres per hour and the death of the Cod stocks. Lack of government control over business interests worldwide has lead to the staggering rate of extinction of one species every 20 minutes. There is ample evidence that unregulated multinationals will exploit the natural resource base as fast as possible to turn a profit, yet the FI persists in its blind faith that private property rights “will do more to secure...sound resource management than will centralized control over the economy” (from the FI’s Economics & the Environment: A Reconciliation). For example, one FI representative suggested that the best way to save the whales was through private ownership, involving electronic corrals to contain the whales in the same manner as cattle. And after the Exxon Valdez disaster, the FI proposed the private ownership of the oceans themselves as the only way to responsibly manage this resource, and reduce the occurrence of such incidents in the future.

A Proud History

Perhaps the worst (or best) example of the FI’s presentation of its ideology to the public was embodied by Walter Block. Block was the senior economist until 1984 and remained a director in the FI until 1991. He is infamous for stating that sexual abuse or discrimination from male employers on female office staff are “part of the package deal in which the secretary agrees to all aspects of the job,” and that child labour is an institution with a “long and glorious history.” He has since gone on to an influential career as a University professor in the United States. Indeed, he was one of the most sincerely outspoken FI employees and is sadly missed by FI supporters and opponents alike.

University Recruitment

The FI has not overlooked universities as the site of potential converts to the cause. They publish the mostly- student written Canadian Student Review, which features such progressive articles as “Cut post-secondary education,” “Thatcherism’s vigorous virtues,” and “Students must accept share of debt.” In addition, several university profs contribute to FI publications; at SFU these include Herbert Grubel, Zane Spindler, Gary Mauser, and Steven Globerman. Grubel was on the FI’s editorial advisory board for many years.

With a steady stream of corporate funding and by substituting rhetoric for accuracy, the Fraser Institute has risen from relative obscurity to become a considerable force on Canada’s political landscape. Quoth Walker: “Our greatest joy is to see many of the ideas that we have advanced and championed come to be accepted so universally.”

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