Former prime minister Brian Mulroney once levelled the bizarre charge that the first thing then NDP leader Ed Broadbent would do if elected to replace him would be to nationalize high-end menswear retailer Harry Rosen. It was a personal shot at Broadbent, who was renowned for his ill-fitting brown tweed jackets, but also a reminder to voters that elements within the New Democratic Party were in favour of nationalizing swathes of the Canadian economy, including banks and railways.
In recent years, the fervour for public ownership in the NDP has abated — at least it had, until Avi Lewis was elected as leader last month.
His activist agenda promised the launch of a public grocery chain, a public mobile provider and a public pharmaceutical company. Corporations would be hit by an “excess” profit windfall tax and “people of means” with a wealth tax. In short, it was a platform that threatened wealth destruction on a scale that would have made Venezuela look like free-market Singapore.
It was, then, a pleasant surprise to see that Lewis’ first major policy announcement last week was not to promise the nationalization of Loblaws or Rogers but a more modest proposal to ban “surveillance pricing,” where companies use personal data to determine how much they are willing to pay.
With prices rising inexorably — the latest inflation numbers suggested fresh vegetable prices rose another 7.8 per cent in March — consumers already think they are being ripped off. They need little persuasion that big corporations are now using technology to personalize prices, undermining the principle of equal access to the marketplace.
Lewis introduced a motion in the House (via MP Leah Gazan) last week that suggested that the NDP under his leadership will pursue populist policies that might cause the Liberals some disquiet.
Lewis said in his announcement last week that governments need to act before algorithmic pricing becomes a “predatory new normal in Canadian life.” He accused Big Tech of squeezing people who are already weathering an untenable rise in the cost of living.
Wab Kinew’s NDP government in Manitoba has already banned the practice, based on widespread suspicion about unpredictable pricing, rather than hard evidence of any gouging.
As I wrote last month, there is a danger Kinew and Lewis are using a sledgehammer to crack a walnut. Researchers of a Competition Bureau discussion paper in January heard about the prospect for unfairness, discrimination, price fluctuations and price fixing. The worry is that companies leverage vast amounts of personal data to set personalized prices. Lewis used the example of a parent whose baby is sick discovering that the price of medicine is based on their search history. But to this point, these types of abuses are unconfirmed.
The retail industry argues that algorithmic pricing uses transactional data to target discounts and promotional offers, lowering the price to consumers. The arbiter of these claims must be the Competition Bureau, rather than politicians playing on unproven fears.
The discussion paper researchers also heard that the use of algorithms improves efficiency, matching supply and demand more quickly, allowing companies to respond faster to market changes. If competition is working as it should, companies charging high prices will lose market share to lower-priced competitors.
What is not yet clear is whether the technology itself leads to anti-competitive behaviour by detecting and responding to price changes made by a competitor, essentially leading to algorithmic price collusion. There seems, at the very least, room for narrow regulatory intervention to increase transparency and oversight.
What can be said with certainty is that this is an issue that is only going to become more contentious and there has been no federal government response yet. Lewis has shown sound political instincts by focusing on something that polling suggests is the cause of public anxiety.
The NDP is up off the canvas, polling at much higher levels than the 6.3 per cent support it won in the last election.
New Democrats clearly need a Broadbent-type figure to rebuild their shattered party: a pragmatist democratic socialist able to create a new coalition between factions, rather than an uncompromising dogmatic ideologue. Lewis campaigned as the latter, but he may prove adept enough to exploit the unease that progressive Liberals feel with the Carney government’s agenda.
He’d be wise to encourage more initiatives such as NDP MP Jenny Kwan’s private member’s bill on a stricter arms-control regime that saw 14 Liberals vote against their own government’s position, while a further 15 abstained.
As perhaps befitted his previous career in broadcasting, my early impression of Lewis was of someone who slipped easily into melodrama and theatricality in an almost Justin Trudeau-like fashion. Yet, in last week’s pricing policy press conference, he was dressed in a dark suit and a darker tie. He played it straight and kept it real. If he continues to do so, he may be able to capitalize when voters inevitably sour on the Liberal man who currently commands the Patagonia-brand vote.