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Tuesday, August 16, 2011

Privatize the CBC? They can't even do a proper cost-benefit analysis

The Globe and Mail commented today that the CBC published a consultant's report showing that the broadcaster "has a $3.7 billion economic impact every year, while a privatized version without the parliamentary grant would produce only $1.1 billion in economic activity."

Can't these guys even do a proper cost/benefit analysis?

The CBC subsidies, if applied elsewhere or even given back to taxpayers, might well generate economic activity far in excess of the $2.6 billion that the CBC would apparently cease to generate. Until we know how large that alternative benefit might be, it's not possible to say that subsidizing the CBC is a good use of taxpayers' money.

The subsidies, incidentally, are $1.1 billion. Here's the consultant's report.

Economist Fréderic Bastiat wrote about the "broken window" fallacy in his essay "What Is Seen and What Is Not Seen" 160 years ago. The CBC and its consultants apparently still haven't heard of it.