The Agenda with Steve Paikin (Audio) - The Pros and Cons of Carbon Tax

Episode Date: April 26, 2024

This week, The Agenda debated the controversial carbon tax; examined why Ontario criminal court cases are being delayed or dismissed; looked into whether Ontario can be a leader in AI technology; and discussed the Russia Ukraine war with journalist Tim Mak.See omnystudio.com/listener for privacy information.

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to heat their homes, to drive to work and to paying more for groceries. For example, farmers have to pay the carbon tax on natural gas that they use to heat their barns. So to keep chickens alive in minus 30 degrees all year round. OK, and to truck food to people. So if you say you're a trucker and you're filling up your big rig, to fill up those two diesel tanks now is going to cost you an extra $200 just in the carbon tax charge. This is helping to contribute to the increased cost of everything. Now, there are other ways to skin a cat. Why aren't folks talking more about capturing CO2 as a waste element

instead of trying to tax people to death? All right, let's try. Let's go there right now. Let's go there right now. Stuart, the carbon tax and rebate policy is obviously one option of a number of options that the federal government considered before landing on the carbon tax and rebate. In your view, might there have been a better, more politically saleable option out there? Well, so carbon tax and rebate, it's important to put both halves of the equation, right? Because what Chris hasn't mentioned is that the average family in Ontario is going to get

more than $1,000 back this year as a rebate from the carbon price. In Alberta, it's more like $2,000. That's a lot of money back. And it offsets for most families what they're paying in carbon price. Chris and I can debate whether or not it completely offsets it. For some families, it does. For some, it doesn't. The parliamentary budget officer says the same thing. Some families come out ahead. Most break even. Particularly the highly wealthy families pay a bit more. No, he said most don't actually.

This is where I want to guess. What I want to hear from Chris is this, right? So there's a letter that came out a couple of weeks ago from 420 economists across Canada saying carbon price is driving down emissions and it is the lowest cost way to reduce emissions. So, Chris, you may know something that most of Canada's economists don't know, but I want to hear from you. If you don't want to do it with carbon pricing, and it's achieving about 40% of our emission reductions, how would you get that big chunk of emission reductions? You talked about capturing CO2, that'll get you two or 3% of it. So yeah, we should do that. And

we are doing it. The government has put in place tax incentives. So there's a number of things. Carbon pricing isn't the only policy. We've brought in phasing out coal power, one of the biggest emitters in the world. We brought that down. We're moving towards electric vehicles. We're reducing methane emissions from oil and gas. We're working on home energy efficiency and heating. The government is doing a number of different things, building codes, but the carbon pricing is the centerpiece of it, and it's going to get us about 40% of the emissions we need to meet our global target.

Okay, let's let Chris speak to that. What do you want instead, Chris? How would you, if you're committed to reducing emissions, and you still haven't answered that question, if you're committed to it, what would you do instead to get that 40% of emission reduction? Do I need to have an economics degree in order to answer this question? I hope not. I sure hope not. Because I just wanted to really frame that.

Okay? Because average working people are struggling right now. We have record numbers of people. But how would you reduce the emissions, Chris? How would you reduce them? If you don't use carbon pricing, what would we do instead? How would you reduce the emissions, Chris? How would you reduce them? If you don't use carbon pricing, what would we do instead? Or do you not care about reducing? For example, we have private companies that are capturing CO2 as an element in the air. They're taking it from the air and they're reusing it for things like fertilizer,

pharmaceuticals, even vodka. Even the blue dye that goes into m&ms is used from captured co2 so why don't we let private companies actually capture this as an element instead of taxing average working people for the sin of heating their home and buying food and traveling around this big cold country so i just wanted to very very firmly excuse early. Excuse me. No, excuse me. Please let me finish. The parliamentary budget officer did two different calculations, OK, in that report. One of them was the simple cost for cost. So say you're Monica in Mississauga. You're filling up your tiny hatchback. You're spending about six dollars and 50 cents extra in the carbon tax. Now, based on that first calculation, you might get that fully back in a rebate.

Fine. But what the parliamentary budget officer also did was calculate the economic impact of that carbon tax for Monica. That includes her home heating, and that includes everything being more expensive because of the cost on trucking and the cost on farmers. Now you're out money. So I think it is important for us to look at the entire picture of the cost of the carbon tax in

Canada before we start saying that you're made whole or better off. By this logic, keep in mind, if people generally or in the majority are made richer by having a higher carbon tax, why don't we make it $500 a ton? Everybody would be super rich. That's nonsense. Okay. Everybody with common sense understands that that doesn't make any sense. People on average are out money because of the carbon tax. Further, if they weren't out money, two things. Why did Prime Minister Justin Trudeau make a car vote for a home heating oil for folks in the Maritimes if it wasn't really a financial burden? And two, where's the stick then? If people are magically getting carrots in their inbox all the time, in their bank accounts, because the carbon tax rebate makes them all rich, then where's the incentive to switch to something that actually doesn't exist for them? Kristen, I'll put you to work first right away. You obviously watch this as the AG critic for the NDP. What's going on in our provincial justice system today that's got you

so concerned here? It's not just myself that's concerned. Many legal observers have expressed the same concern. And essentially what we're seeing is a historic high backlog in cases taking an extraordinary amount of time to get to trial. And we're also seeing a chronic underfunding of the court system, meaning that it's not adequately staffed. We have sometimes courtrooms going dark, courtrooms not being used the maximum number of optimal hours. And most significantly for the general public

is that we're seeing violent offenders sometimes walking free. So that means sexual assault cases, as we know, charges are being stayed or withdrawn, and simply trials are not happening in a timely fashion. So all of this is leading to quite a bit of chaos. And I would say that the legal observers are now starting to call it a crisis. And I would tend to agree. Let me get Kate to follow up on that. Why is this issue so critical right now, Kate? It is critical for everyone because it can happen to anyone. I was nearly murdered July 31st, 2021. My abuser was subsequently charged eight times and all eight charges were stayed two times.

There was five charges in the provincial court and three charges in the federal court. And that result is completely abhorrent because now my abuser is free and leased side and free to do this again to someone else without a single consequence. It's terrifying. It creates a very unsafe culture. And unfortunately, given my experience after speaking out about this, thousands of people have reached out to me and hundreds of victims with the same story. So I am not unique. I just want to be a conduit for change. And we need we need to change this because it is so unfair to innocent civilians and unfair to the victims and their families. Kate, let me do a quick follow up here. Did you get an explanation as to why your case ended the way it did? Attorney General, I wrote to them. I had to write to them.

Well, we just, we didn't have time to prosecute it. His Chapter 11B rights overstepped yours, essentially. So his rights outweighed mine this entire time. I was the victim of attempted murder. I mean for my attempted murder we have it on video we have pictures of him doing this we have me in the moment after the SWAT team if you will

came to my house and found me and pulled my blood that night and it still doesn't matter I've been hired a high profile criminal attorney and it still doesn't matter. It's not a matter of resources. It's a matter of criminal rights outweighing victims' rights. And Canada isn't safe. It's a good thing we've got a lawyer here, because I think Kate just mentioned something

that we need some explanation around. Chapter 11b rights and this kind of thing. What's she referring to? Sure. In the Canadian Charter of Rights and Freedoms under Section 11b rights and this kind of thing what's she referring to sure in the canadian charter of rights and freedoms under section 11b every canadian has the right if they're charged with a criminal offense to have a trial within a reasonable time and the way our supreme court of canada has looked at that is they've said that this is uh well it's a right that belongs to the accused person in a sense it's also a right that belongs to the public and the whole Canadian community. Because when that right isn't enforced properly,

what we see are massive backlogs. The current timetable is about two and a half years to get to a trial. For what kind of case? For a serious case, for an indictable offence, being a reasonable amount of time. And without those kinds of limits, we can start to see backlogs of four, five, even six years. This has happened historically, which is a bad outcome for everyone involved in the justice

system, including victims, their families, witnesses, and the accused person. Okay, going to do a follow-up with you too, Stephanie, because the case we hear about all the time is the Jordan precedent. Tell us what that is and why it's impactful here. Jordan is a case where the Supreme Court of Canada changed the way the 11B right was interpreted by courts to try to make it clearer and easier to enforce and interpret. And what they did is they set basically maximum time periods for reasonable delay for cases prosecuted in the Ontario Court of Justice. It's 18 months. In the Superior Court of Justice, it is 30 months. And that delay is focused on delay created by the state. And so delay created

by the defense or by an unexpected event like an illness or something like that. You go to trial on the first day and the judge is ill. Those delays don't count, but delay that is caused by the prosecution or congestion in the court system does count towards that time frame. Let me ask our director, Sheldon Osmond, if he would, top of page three, bring up this chart. And those of you here in the studio can see it on the monitors here. This is showing AI investment in Canada in fiscal year 2022. More than a billion dollars invested in Ontario, 600 million in Quebec, roughly 250 million in each of BC and Alberta, and about 360 million for the rest of the country. So add it all up, we're at about two and a half billion

dollars across the country. And yes, Ontario is well ahead of everybody else, but as the biggest province, you would expect that. Sanjana, I guess I want to know from you, are those numbers kind of where you think they ought to be? I mean, ideally, it should be much higher than that. We would like to see much more investment in the ecosystem. And that is why we have, again, like Tom referred to, right, like there's investments that are made in talent through the Pan-Canadian AI strategy, which was effectively a talent strategy for companies like, you know, Cohere, Wabi, CentML, Untether, et cetera, to come out of the ecosystem. There have investments, there've been investments made in generous tax credits that help companies be more capital efficient and move the money into other facets of the business like go to market then you have venture capital investment that is required to put more money into the ecosystem and into founders such that they can scale all of these combined are

required to increase those numbers and I actually think we were talking about entrepreneurs in the ecosystem and the American entrepreneurs how they're different from the Canadian entrepreneurs I think we all need to invest more and more into this ecosystem because the more you invest in the ecosystem the more founders come out they if they're successful they exit they reinvest their you know experiences their capital back into the ecosystem and that's also the story of the founders of Radical, who launched a company, sold the company, reinvested that. And that's our hope with the companies that we invest in that are from the ecosystem. They grow, they scale, and there's a

flywheel because they reinvest in the ecosystem, whether that's their own talent experiences, as well as their financial capital. Well, that does prompt a question for you, Ryan, which is, and we did a program about this actually a week or two ago, we don't seem to have the same appetite in this country for risk-taking and upfront investment in AI, venture capital, et cetera, obviously compared to the United States, but even compared to some of the other G7 countries where we should be more on a par, the thinking goes. Why is that? Well, I understand that's a common perception. I don't think I can comment on the industry as a whole because I don't have that experience, but I could share from my perspective, I've had slightly different experience. I have experienced some of the Canadian ecosystem at least taking risks on us and believing in us as an early

stage company But I guess what's interesting about that is for example the example I would give would be textiles Toronto which is an accelerator the director is a guy called Sunil Sharma and They took a risk invested in us and introduced us to the rest of the ecosystem. However, they are originally an American company So they may go so it may be that Texas, Toronto embodied the spirit of, you know, of the Valley where, you know, they take risks on early stage companies. But it was through that,

that we were introduced to other Canadian venture capitalists who did eventually take a risk on us as an early stage startup. All right, Chris, I'll get you to comment on the same thing. You know, you've seen this both from an American point of view and from a Canadian point of view. Why do we seem to be much less interested in taking those risks? I think a big part is when you look at the size of the investments, it definitely takes a lot to compete at the highest levels here. Take chip development as an example. One chip might take

three plus years to develop in excess of $100 million just to bring one product designed to market. And so while the numbers on the prior chart may seem big, they're actually not in the context of actually what it takes to develop and compete at a global scale in AI. And I think one of the big elements of risk taking is also the community of risk taking. big elements of risk taking is also the community of risk taking. So we've gotten great backing from folks like Radical Ventures, Canadian Pension Fund to have the foresight to have those long lead investments. But if you look at tech hubs, Silicon Valley, Singapore, Taiwan, you have that entrepreneurial spirit that feeds off each other. There is movement of people between companies. They support each other. And one of the biggest differentiators also isn't just the startup mentality.

It's also the consumption. It's your banking sector, your healthcare sector, your agricultural sector at the forefront of using and deploying the solutions that are being developed in your in your ai ecosystem that's also that flywheel effect that starts kick-starting and feeding off each other because then you want people going back and forth between big enterprise small enterprise to seed innovation ideas and experiences back and forth and so it's not just the entrepreneurial startup risk-taking, it has to be risk-taking in your key sectors that can benefit from new technologies like AI. You need to be at the forefront of adoption to make it happen.

Let's talk about what's happening right now. You obviously saw that the United States Congress, some might say miraculously, passed a huge aid package for Ukraine, 60 plus billion dollars. You would understand this better than most. What impact can that amount of money and materiel have on this war? Well, first and foremost, I think what Ukrainian and Western leaders will try to do is stop the bleeding, right? And I mean that literally and figuratively. Right now, Ukrainian forces are reporting that Russian troops are making serious progress in eastern Ukraine, in the Donbass region. And they've been able to make much faster progress than they had been in weeks prior. And that's because the Ukrainians are simply put outgunned. They are firing a very small percentage in response in

terms of artillery that the Russians are firing. They don't want to run out of ammo. They want to run out of ammo. And effectively, in many cases along the front lines, they have run out of ammo. So the first priority for them will be to stop the advance of Russian troops because the Russian troops have the initiative right now. This is a logistics question. How does Ukraine get as much 155-millimeter artillery rounds right to the front lines as quickly as possible? That's the first step. But the second step is for the Ukrainian military and political leadership to develop a broader strategy of what does victory mean and how are we going to get from here to there? That's something that they haven't been able to do because they haven't been able to understand what kind of tools, equipment and resources they've been working with. So now the ball's back in their court.

they've been working with. So now the ball's back in their court. And the Zelensky administration and his generals, they're going to have a really tough task for defining what are we going to do over the next year? We've got this aid package. It's probably going to be the last aid package from the United States for the foreseeable future. How are we going to use this in the best possible way to get the aims that we want to achieve in the near term? I still think people want to know what constitutes victory or defeat in this war. You know, it's not going to be like we think of in a traditional World War II setting where they're going to meet in a train car and they're going to sign a document. And presumably at some point, somebody decides it's over.

So apropos of your example there, how do we get from here to there? When you ask 100 people, you'll get 100 different answers of what victory entails. Right. Some people will say that it means that Ukraine reclaims all of its territory, including Crimea. Others will say that it's a sort of just negotiation. One Ukrainian official said something really interesting, saying that he defined victory as being able to get onto an aircraft in Kiev, a plane, a commercial flight in Kiev, and fly to the Hague where he would observe war crimes trials at the ICC. So two elements there, the resumption of normal economic activity and accountability for the atrocities during the full-scale invasion. You know, the Zelensky administration

has taken a very hard line, which is to say this war isn't over until we've reclaimed everything. I don't know if reality is going to set in and force him to change his tune on that. Do you think that's just a negotiating position? Well, I think it's likely. I mean, right now we have very, very, very, very exhausted Ukrainian troops.

They're going to need to make hard decisions like are they going to mobilize hundreds of thousands of new soldiers, train them and use them. But right now, the military situation, strictly speaking, because of the deadlock on the front lines right now and how slow progress is made, as well as how dug in Russian troops are, it's hard for you to see in the near term Ukraine reclaiming all of the territory that it had gained to date. Right now, what they have to do is stop the bleeding and then regain the initiative. And then they can have a conversation about, you know, how far can they go? I don't know how often it's the case that a war between two countries and the outcome of that war is dependent on elections held in a third country. But that could be the case here. Biden versus Trump. Does the future of the war in Europe depend on who wins the American election this fall? Not only the future of the war in Europe, but also what happens in the Indo-Pacific

region, right? Authoritarians all across the world are watching to see what the United States does, not only with the passage of aid to Israel, Ukraine, and Taiwan, but also whether the United States decides to elect Donald Trump and heads in a more isolationist direction. You know, the war in Ukraine is not just about the combat and the conflict in Eastern Europe. It's also part of an emerging Cold War between authoritarianism and democracy all around the world. It really does feel to me, I don't know if it feels like this to you, Steve, but it feels to me like we're entering a much more dangerous phase of global affairs. Can I speak to that for a second? I grew up during

the Cold War when there were tens of thousands of nuclear missiles, Soviet and American, and we were right in the middle of the two of them. We knew that if World War III started, the missiles were going to go over Canada. But we always had, at least I always had the sense that there were sane people who were on either side of that, of pushing the button. I don't get that sense here. I get the sense this thing could spiral out of control because nobody's sane in this one. Is that fair? Well, I grew up in the sweet summer of the 1990s and a different kind of phase of geopolitics. So it's a new and unexpected and unwelcome shock to me. and unexpected and unwelcome shock to me. But it really does feel... There are new rules and they're being written right now. We don't know who's writing them and they're being done in real time.

The Agenda with Steve Paikin is made possible through generous philanthropic Thank you.