June 2000 Fraser Forum: On Bill 11, Unions Lose, Truth Wins
Although the Alberta legislature has now passed Bill 11, which allows contracting out selected surgical services to private surgical facilities, there's no denying the hostility of ordinary Albertans towards the bill. A recent Angus Reid poll found that 59 percent of Alberta citizens oppose it. The more passionate among that 59 percent have been found protesting outside the Alberta Legislature, some resorting to smashing windows, slashing tires, and attacking security guards. It appears, to quote the protesters, that "This is what democracy looks like."
Is the passage of Bill 11, then, a perversion of democracy? On the contrary, the only evident threat to democracy is the foundation of disinformation and fearmongering on which opposition to Bill 11 has been fomented. It is no wonder that the majority of Albertans oppose Bill 11; they have systematically received a distorted and hysterical view of what the bill embodies.
It was just this outcome that I had hoped to prevent when I surveyed all of the published academic literature comparing the performance of for-profit and government hospitals. This body of evidence, fifteen studies in all, attempted to answer the question fundamental to evaluating Bill 11: do for-profit hospitals provide care (of a particular quality level) at lower cost than do government hospitals?
The answer is yes, according to the vast majority of the evidence. Specifically, eight of the studies find lower costs among for-profits, while only three find the reverse (lower cost among government hospitals), and four find there to be no difference in cost.
Unfortunately, these facts have been obscured by a barrage of advertising and "studies" (although it's hard to distinguish between them) sponsored by the public-sector unions, particularly the Canadian Union of Public Employees (CUPE). The central message of these efforts has been two-fold: disinformation (false claims that for-profit hospitals don't have lower costs), and hysteria (that Bill 11 will mean the end of medicare or health care in general).
The disinformation effort has encompassed "studies," in response to my comprehensive analysis, by a quintet of historically reflexive defenders of medicare (Evans, Barer, Lewis, Rachlis, and Stoddart), by the Parkland Institute, by the Consumers Association of Alberta, and by CUPE. By the sheer quantity of these pamphlets, these advocates have succeeded in diverting interested Canadians from the issue of the dubious quality of their analysis.
For example, while I evaluated all 15 studies, and admit that some of them reach the conclusion that government hospitals are lower-cost, the disinformationists only report on that small subset of those studies which support their claim. Apparently, these authors seem to believe that if they repeat the same erroneous information again and again, it acquires the force of truth. Judging from the decline in Ralph Klein's approval ratings since the start of this disinformation campaign, it appears their cynical ploy has illustrated Abraham Lincoln's dictum: you can fool all of the people some of the time. It's a pity that the public can't sue for social-science malpractice.
The other prong of the Bill 11 opponents' efforts has been largely emotional, consisting of the warning that passage of the bill will engender the end of either "medicare" or of the health care system. These apocalyptic fears have been particularly encouraged by CUPE television ads containing footage of a Calgary hospital imploding.
What all of this has proven is not that Bill 11 is a bad idea, but that an expensive union propaganda campaign can influence public opinion. Evidence of this is found in the Angus Reid poll, which reveals lower support for Bill 11 than for "anything that can be done to improve health care services and reduce waiting times ... including paying private facilities to provide certain health care services." That is, the idea of contracting out is more popular, both in Alberta and in the rest of Canada, than the reality of contracting out as embodied in Bill 11.
CUPE and its friends have demonized Bill 11, undoubtedly because they would suffer financially if it were passed. A recent comparison of public union wages paid to non-medical (cooking, cleaning, etc.) hospital staff and private union wages paid to hotel staff performing the same duties revealed that the public union hospital employees earned 25 to 63 percent more per hour than their private union hotel counterparts.1
And public unions aren't just effective propagandists in Canada, but in the US as well. Two economists studied which US cities and counties were least likely to privatize their hospital services, and found that it was the jurisdictions which had the highest proportion of unionized public employees.
So, it's not surprising that Ralph Klein has encountered such vigorous public hostility. But it is dismaying, given the substantive merits of Bill 11, how readily union disinformation has distorted public opinion. Similar propaganda served for many decades to conceal the flaws of state enterprise in Eastern Europe, and serves now to obscure the path to meaningful reform in our health care system. Canadians deserve better. The passage of Bill 11 is one small step in the right direction.
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