I may not be the best person to write a response for this as it coincides with my own political bias… but here’s trying!
Overall, really well done. Something I think that could have been emphasized would be the need for an overall political restructuring to actually allow this. Despite the outcome of the most recent election, Canada has a large population of people with right wing ideologies that I would assume would oppose an idea like this. It is likely too big of a topic to touch on, but maybe at the beginning suggest that the country may have to start leaning leftwards in order to continue producing art.
Did you look into the grants / subsidies in Scandinavian countries by chance? I would assume they are higher than both Canada and the States and may offer some insight into how this could actually be an effective model.
In one part you write “[a]uthors could be better-motivated to work in this emerging landscape if they received money not for selling their works to consumers directly, but for having produced the work in the first place.” It may strengthen the essay to compare this to the university model- professors are paid to do research, they release the research on databases, essentially for free (to those with access, like in your model Canadians with an Internet connection).
You touch on how it benefits the readers, many of who are doing this illegally right now anyways. I think the benefit to readers could be elaborated on. Sure, they’re now getting for free what they had to break the law to get for free. But you could maybe argue the increase in self-education / overall reading that may go up? People don’t want to go to libraries, but free online libraries may be an incentive to read more.
When it comes to Publishers you mention an article saying it won’t necessarily affect them negatively. However, in the long run, if the government did increase support for authors and there was a ton of variety of good literature for free, wouldn’t people just opt for those instead of paying for a book? You do kind of mention this by stating “…while mega corporations typically suffered due to a lack of willingness to try innovative methods” but I think the thought could use some more exploring. I personally believe it could end up being the death of Canadian publishing houses, although would offer many employees jobs as editors, etc. for Canadian agencies.
You state that there would be a variety of topics that should be published, but could this model stiffen creativity? People may assume that to receive grants, all their books have to have some Canadian aspects to it. From my experience, any book written about the island is incredibly boring. Should there be steps in place to not have some type of bias within the reviewing of submissions? Not to get too paranoid, but the control of literature by the government seems incredibly 1984-esque.
Although I love the idea, is it a realistic model for the Canadian government to implement? It’s essentially paid for by taxes with no economic benefit. Sure, it increases cultural capital, but in the end of the day, you can’t use that to buy anything. I think addressing the negatives of this model could strengthen it some more.