CBC History: Lost Horizons Chapter 2

This chapter examines the factors that led to the creation of the CBC
as well as the vision that guided it during, roughly, the first 50 years
of its history. The chapter chronicles the period of broadcast scarcity,
when the CBC was largely a singular and powerful voice able to shape
Canadian life, to the cable era, when audiences were fractioning and
the public broadcaster became just one voice amid a multiplicity of
broadcast services. As Amanda Lotz has argued, cable changed the
tide of broadcasting not only because it used a different broadcasting
model, one based on appealing to narrow rather than broad interests,
but also because it ushered in a new era of experimentation and excel-
lence.1 The chapter highlights a number of key decisions that led to the
abandonment of the CBC’s original vision: its forced retreat from local
TV news, the decision by the CRTC to deprive the CBC of a significant
place in the cable universe, and the complex and tangled relationships
with governments that distorted its priorities and limited its budgets
at the very time when it should have been expanding its services and
ambitions. In short, this chapter is about the CBC’s lost horizons and
the role that successive federal governments have played in helping to
undermine that original vision.
The State or the United States?
British scholar David Hendy argues that public service broadcasting
was one of the most important political and social developments of the
twentieth century.2 This was certainly the case in Canada. Prime Minis-
ter Mackenzie King, who established the CBC in 1936 (after the failure
of the first experiment, the Canadian Radio Broadcasting Commission,
or CRBC, created in 1932 by Conservative Prime Minister R.B. Ben-
nett), believed that through radio, “All of Canada … became a single
Chapter 2
Lost Horizons

Lost Horizons 27
assemblage swayed by a common emotion….”3 Politicians immediately
understood the value of having their own voices heard from coast to
coast, and governments intrinsically understood the power that came
from being able to penetrate Canada’s vast distances with the flip of a
switch.
Part of the motivation for launching the CBC was that, by the end of
the 1920s, the government was losing control over radio. Commercial
broadcasting had become a free-for-all. Beginning with the issuing of
the first radio licence in 1919 to the Marconi Wireless Telegraph Com-
pany of America for a station in Montreal, by 1927 the number of radio
licences had mushroomed to close to 75. Most crucially, major Ameri-
can broadcasters such as RCA, Westinghouse, and CBS were making
inroads into Canada’s largest cities. But it was also that a hodgepodge
of different models and interests had emerged. The Manitoba govern-
ment owned two radio stations; the University of Alberta had initiated
the first educational station in 1927; the Canadian National Railway
had begun broadcasting on trains in 1923, eventually creating the first
national radio network; and religious broadcasters were quick off the
mark with their own stations. In addition, there was a growing wireless
subculture of amateur operators and radio clubs. The federal govern-
ment faced the need to bring order out of this chaos but also ensure that
Canada’s national interests were being served.
What worried the federal government the most was that radio recep-
tion was being compromised by powerful signals from south of the bor-
der and that Canadian commercial operators would serve only larger
cities such as Montreal and Toronto, where they could make money,
leaving vast parts of the country in silence, without radio. The main
concern, however, was the fear that the Canadian radio system would
become an adjunct of American broadcasting. Vancouver alone was
bombarded by six high-powered American stations that dominated the
airwaves from early morning to late at night. By 1930, an estimated 80
per cent of Canadian listeners preferred US programs.4 To some Cana-
dian nationalists, it seemed as if the game was lost almost as soon as it
had begun.
What’s interesting is that while so much has changed in the world of
Canadian broadcasting, so much has remained the same—namely, the
problem of how to enhance Canada’s cultural sovereignty while living
beside a financial, entertainment, and cultural behemoth. This primor-
dial question in relation to Canadian broadcasting was famously posed
by Graham Spry of the Canadian Radio League, a lobby group formed
by prominent Canadians in 1930. The choice, he argued, was either
“the state or the United States.”5 In other words, broadcasting could be

28 The End of the CBC?
Canadian only if it were a public service. Canada could either choose
a national public broadcaster that would be a “single glowing spirit of
nationality” or allow Canadian broadcasting to become entwined with
the American commercial system.
A.W. Johnson, the president of the CBC from 1975 to 1982 and one
of the principal architects behind the creation of Canada’s social pro-
grams, believed that countering the influence of the United States was
at the core of the decision to found the CBC. As he put it, Canadians
exposed to a relentless flood of American programming were “absorb-
ing American interpretations of events … soaking up the value system
of the United States … [they are] coming to expect Canadian traditions
and institutions to look and behave as if they were American traditions
and institutions.”6 In other words, the CBC’s supporters saw public
broadcasting as almost a life-or-death decision for the country.
The federal government faced another difficult dilemma, one that is
largely forgotten today. Some religious broadcasters had begun using
the airwaves to spread poisonous views about other religions and
attacked governments as “the work of Satan.”7 Preventing radio from
becoming a launching pad for religious warfare was a real, if a largely
unstated, goal of public broadcasting.
The decision in favour of public broadcasting was made more likely
by the fact that there was a successful example that could be emulated:
the BBC, which had been created in 1924. It has to be remembered that,
at the time, Canada was very much a British country. Most of its peoples
had originally come from the British Isles; its institutions, including the
monarchy and Parliament, were inherited from Britain; the Judicial
Committee of the Privy Council (JCPC) in Britain would remain Can-
ada’s highest court until 1949; and Canada had yet to achieve foreign
policy independence from Britain. The BBC was not just another broad-
caster; it was for Canadians the premier example of what broadcasting
should be.
The BBC was the product of forces that seemed to be coming together
at the same time in British society but were also emerging in Canada.
The BBC was, in part, a response to the fact that the old world was
crumbling. There was the feeling not only that a better world had to
be created following the carnage and suffering of World War I but also
that new social forces had to be accommodated, including women’s
suffrage, the expansion of the vote to men who had previously been
excluded because of a lack of economic means, and the rise of socialism.
There were also the lingering vestiges of an age-old Victorian paternal-
ism, which believed in helping the less fortunate. Consequently, under-
pinning the BBC’s mission was a kind of social gospel. The BBC was all

Lost Horizons 29
about improvement. It was all about educating the public and cultivat-
ing an appreciation among citizens for high culture, proper language,
and more refined tastes.8
The first rough draft of what would become Canadian broadcast-
ing policy emerged from the work of the Royal Commission on Radio
Broadcasting, chaired by the then president of the Canadian Bank of
Commerce, John Aird. In its 1929 report, the Aird Commission argued
that broadcasting needed to be seen primarily as a public service. The
report was strongly and resolutely in favour “of some form of public
ownership, operation and control behind which is the national power
and prestige of the whole public of the Dominion of Canada.”9
Even with the Aird Commission’s report in hand, creating the CBC
was no easy matter considering the many challenges that the federal
government faced. First, it wasn’t clear that broadcasting was under
federal jurisdiction. Both Quebec and New Brunswick were convinced
that broadcasting was a provincial matter, and as mentioned previ-
ously, the government of Manitoba already owned radio stations. In
June 1931, the Supreme Court of Canada ruled in a 3–2 decision that
broadcasting was a federal responsibility. Although Quebec appealed
the decision to the JCPC, the British court ruled in favour of the federal
government, recognizing Ottawa’s right to legislate under the “peace,
order, and good government” clause of the British North America Act.
Had the courts ruled in favour of provincial control, arguably, much of
Canadian history would have been different.
Deciding how to finance the public broadcaster would take time to
sort out. Until 1953, the CBC was funded by licence fees paid by Cana-
dians when they bought radios and by a limited amount of advertising.
Licence fees ended when the government calculated that the costs of
TV broadcasting, which had just begun, would be far greater than they
had been for radio. The licence fee was to be replaced by an annual
appropriation from Parliament. One can argue that having backed
away from the licence fee, Canadian governments would never again
have a chance to fund broadcasting from what would be, in effect, an
annual value-added tax on the purchases of communications and elec-
tronic equipment without incurring the public’s wrath. The political
price would be too great for any government. Some might argue that
financing the CBC through an annual appropriation from Parliament
also allowed governments to exercise greater political control over the
public broadcaster.
In retrospect, the choice of an annual parliamentary appropriation
was a poor one. The most successful public broadcasters, such as the
BBC, SVT (Sweden), NRK (Norway), ARD and ZDF (Germany), NHK

30 The End of the CBC?
(Japan), and RTÉ and TG4 (Ireland), among others, are funded by
annual licence fees paid by TV owners. The fees are generally set by
governments, with the size of the fees fixed for a certain length of time.
In the United Kingdom, the fee is collected by the BBC itself, while in
other countries, the fee is collected by the post office or comes as part
of the electricity bill. The licence fee in the United Kingdom is approxi-
mately Can$260 a year, a figure that is close to five times higher than
the amount that, according to a Nordicity study, at least, the Canadian
federal government spends every year on public broadcasting in per
capita terms.10 Taking into account that the British population is almost
twice as large as Canada’s, it’s no wonder that the BBC remains the
force that it is. The fee is even higher in Germany, Denmark, Sweden,
and Norway.
The licence fee means that public broadcasters are not dependent for
their funding on the whims, vendettas, and sudden mood swings of
politicians. Since they know years in advance, in approximate terms,
what their funding will be, they have a longer planning window—a
considerable advantage given that programs can take years to develop.
Moreover, licence fees are set high enough so that, in most cases, public
broadcasters do not have to carry advertising. This gives broadcasters
much greater latitude to challenge governments and powerful corpora-
tions, take unpopular positions, and break controversial stories with-
out fearing a backlash from politicians and advertisers. By contrast, the
CBC has often found itself riding a financial roller coaster, not knowing
what its budget will be from year to year. As will be discussed later,
politicians on all sides have had few qualms about using financial
purse strings to warn or punish the CBC. Moreover, since the CBC’s
funding is always measured against other priorities—health care,
infrastructure, transportation, social services, equalization, housing,
defence, university research, etc.—the CBC has often been an easy and
sometimes popular place to cut. When it abandoned the licence fee, the
federal government sowed the seeds of future troubles and constrained
the future development and capabilities of public broadcasting.
After an awkward period in which the CBC alternated between
French- and English-language programming during its broadcast day,
prompting a growing outcry from listeners in Ontario, in particular,
separate French- and English-language services were established in
1941. Despite having a common mandate, the CBC and SRC have, as
discussed earlier, developed different programming content and styles,
reflected different cultural and political values, and drifted into dif-
ferent orbits. Almost from the beginning, there was little contact, few
crosswalks, and only small dollops of sharing. Patrick Watson, an on-air