FidelityConnects: New world order: What does it mean for Canada and investors?

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Hello and welcome to Fidelity Connects.

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I'm Pamela Ritchie. Canada finds itself at a pinnacle.

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Trade, defence, industrial capacity, intelligence sharing,

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and national unity, each of these essential pillars must align with

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a strong and forward-looking national defence strategy.

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Time really is of the essence.

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With the Prime Minister referring in his Davos remarks to a new world order

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taking shape the question becomes how does Canada bring together

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its human, technological and geographic strengths to move

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confidently into this next era with a unified crystal clear

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vision. What might today's industrial shifts mean for Canada

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operating in a transformed global landscape, navigating new diplomatic

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challenges abroad while still striving for cohesion at

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home. Our guest today has rolled up his sleeves tackling these issues

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for decades as head of Canada's intelligence agency, overseeing

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the national security apparatus, serving as deputy minister across

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several federal departments, and acting as a key advisor to both

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prime ministers and to the civil service leadership.

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We welcome Dick Fadden to the studio today who is currently senior advisor

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at Capitol Hill Group.

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A reminder that today's webcast features live French audio interpretation.

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Please join us in either of our official languages.

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A warm welcome to you, Dick. Thank you very much for being here.

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Thank you. It's great to be with you.

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Absolutely delighted us by showing up here today.

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You have a storied career resume.

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You have met with everyone that we've ever read about and lots of people that

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we haven't read about. Tell us a little bit about how you're interpreting this

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moment in time for our country.

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I think we're coming to a turning point, to use a phrase that the Prime

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Minister hasn't used yet.

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Turning point, though, implies that not absolutely everything from the past

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needs to be thrown away.

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I do think the Prime Minster in his Davos speech hit the mark

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when he said that we are facing a brave new world.

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It's not just because of the United States, which are causing a

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great deal of instability in the world, but China is increasingly assertive,

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in particular in Asia and a few other parts of the world, Russia is causing

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problems in many places.

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We tend to forget about terrorism. It remains a significant issue in large

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parts of the world.

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Fundamentally, it's left Canada for the first time relatively isolated

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because we're not under the umbrella of the United States which, whether we

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like to admit it or not, I think allowed us to not make a lot of decisions

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because we were so closely attuned to the US we sort of followed along.

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We did take some independent paths in the past

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but I think now we're going to have to try and decide what kind of country we

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want to be. How are we going to prioritize that path

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and forge new relationships, both with other countries, international

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institutions but I also think forge a new relationship with the United

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States because whether we like it or not we cannot ignore the United States.

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No, certainly. We need to know what the United States'

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goals, end game plan is first before we

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either create a plan for ourselves that somewhat reacts

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but also offsets and complements.

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I think that's right.

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Having said that, I don't think we can do that with absolute certainty because

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the current US administration is rather inclined to shifts in

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policy in the very short term.

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I think we have to accommodate the idea that there are a number of scenarios

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that are possible and we have to build those scenarios so that we're ready to

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react to them. Having said that, I don't

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care if it's Mr. Trump or somebody else, we have stuff that the

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US wants both geopolitically and practically and we have stuff that

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we want from them geopolitically and practically.

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We're going to have to find some way of working amidst all of this.

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I think, if anything, the Prime Minister and the government are going to have

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to be fleet of foot and fleet of mind because instability, I

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think, is certainly with us for 2026.

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You mentioned that for a long time we didn't need to think about some of these

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priorities and to prioritize because we essentially followed American foreign

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policy which was neither good nor bad, necessarily, it just was.

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I wonder if one of the things that comes from this

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new moment where we are not protected by the British Empire, which we were

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leading up to the Second World War, for instance, again,

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tell us about this isolation because it does sound a little bit frightening.

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Do we go back to pre-something?

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It's a very good question. I think we have always been under somebody's

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umbrella.

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In both the United States case and the British case they had a world view.

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To some degree we shared that world view.

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I think today the United State is inclining back to a somewhat different

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era where they were more inward-looking than they have been of late.

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I'm not a great, keen supporter of many of Mr.

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Trump's policies but I think we have to be honest.

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This trend towards inward-looking and quasi-isolation started

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a while ago. Mr. Biden did a bit of it.

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Certainly, the Bushes did and Obama.

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They have been criticizing us, for example, about not pulling our own weight on

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defence for quite a number of decades.

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I think it's worrisome, in particular because we don't know how

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far back they want to go.

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I don't think it's practical from the United States' perspective for them to

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isolate themselves entirely.

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There are some stuff from around the world that they absolutely need, including

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from Canada, and also, if they are going to take advantage

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of what they ... the United States president is currently saying he wants to

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bring peace to the world. He cannot do it alone.

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One of the strengths of the United States for decades has been their ability to

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leverage alliances. Well, those alliances are rupturing because we don't

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quite know where Mr. Trump is going and the extent to which he will

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stick with a particular path or policy.

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Is it fair to think that Mr. Trump in this spheres of influence

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sort of theory of things definitely wants fortress North America and

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South America or the Americas to be under

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American hegemonic control? I mean, that just sort of seems logical

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geographically.

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No, I think it does. I mean, having said that, I don't think he wants to take

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over any countries but he wants a

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continent that--

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Phew, I'm glad to hear that.

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--broadly speaking is responsive to the United States geopolitical

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view of the world, which currently means pushing back a bit on China,

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worrying about Russia and a few other things.

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In a strange sort of way it's similar to the Chinese view of the world.

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They like influence but they don't necessarily want to take over other

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countries, possible exception being Taiwan.

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The Russians, on the other hand, if we go back in their history, their view of

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hegemonic control is taking over.

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I don't think he's about to invade Canada or Mexico

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but there are any number of levers that he can

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utilize to bring to bear United States pressure, United States influence.

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I think that's bad. I mean, the basis of

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national sovereignty is that countries should be able to make their own choice.

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Mr. Trump has recently said that he's going to heavily tariff any country that

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sells oil to Cuba.

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I don't think that is a good thing. It's clearly a violation of how

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we've been thinking about international law for many, many decades.

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The people of Cuba don't deserve this nor do other countries

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deserve to be told they can't sell oil to Cuba, in particular.

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Now, I happen to agree that we shouldn't sell oil to Iran because there are

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United Nations sanctions but there's a judgement to be made in every case

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and hegemonic control, hegemonic influence I think may be

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the better way of putting it, but he sure as heck

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wants to have a lot of influence and he wants to make sure that no country goes

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off entirely on its own.

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We, Canada, have been worried over the years, the last two decades, about

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Chinese and Russian influence in Latin America.

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That's not something to be neglected.

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No, absolutely. You can see that that's moving very quickly.

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I mean, you've seen Scott Bessent, the head of Treasury, very

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involved with Argentina and making sure that that has come under the influence

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and, you know, debts are paid, basically, by American backing and so on.

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Let's come back to the Davos speech but really how it worked

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... I mean, I would say it was an opening salvo to the CUSMA negotiations.

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I don't know if you'd go that far  but it seemed like a bit of

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a standing up for yourself as you march into what looks like

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it's going to be a very difficult negotiation coming up in July.

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I think it had a two-pronged plug, if I can put it that way.

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I do think at one level it was signalling to the

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negotiating team in the United States that when we go into CUSMA we're going

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in with our eyes open, recognizing that the world has changed

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and that we are diversifying, we are doing a whole bunch of things so

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don't assume that we're just going to act like deer in headlights.

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The other prong would be I think he was signalling to the rest of the world

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the world is changing, we need to make different kinds of ties, some

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geopolitical, some trade, some economic, some people-based.

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I'd say there were two equally important but

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in both cases they were, to use your expression, I guess launching

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pads to two totally different geopolitical

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realities that we're going to have to deal with this year.

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It's sort of becoming a cohesive country of industries, of

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companies. For instance, you've worked over the years through your capacity

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with CSIS on various aspects of foreign intervention, interference.

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If you look back at Huawei which was the telecom operator

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for China and we through US relations

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and so on decided that we were not going to play that game and going to make

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sure that Chinese technology of that calibre was not

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in Canada and that was sort of how that all worked.

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Just speak to the difficulty of Canada being on its own, trying

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to broach its own course and actually genuinely having all

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of these different international voices in their heads.

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How possibly could we do it to

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stand on our own or have alliances on our terms?

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That's the $64,000 question, I think.

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Let me back up just a tiny little bit and say, if you have a

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spectrum of relations I think there's a chunk of these at one level

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where we actually are on the same wavelength as the United States.

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We should not be saying that we're rejecting everything the US government

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is standing for. I think people in Canada are saying that

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the United State's administration is currently the personification of evil,

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that's not true. There are a lot of things I disagree with both internally and

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externally but there's a whole bunch of geopolitical stuff we

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have to share with them, for example, in the defence of North America.

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We're now spending billions of dollars on an over-the-horizon radar up

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north and we have to do a bunch of other things.

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There ain't much disagreement there except on details.

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Same thing with the acquisition of a fighter, the F-35

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or the Gripen.

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I think they're holding off deciding what to do as a bargaining tool for CUSMA,

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to go back to your earlier point.

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There's a whole raft of other areas on my spectrum which we

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probably share with NATO, with the Baltic

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countries and the EU.

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I think there we're going to have to push a little bit harder because there are

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issues of disagreement with the United States.

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On the other hand, Europe is beginning to push back as well.

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There is a limit to how much I think the United States can actually force

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Europe to do something they really, really don't want to do because it's

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not in their mutual interest.

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There's a raft of other areas where we might want to take a slightly different

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view.

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Like the Middle East?

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The Middle East is one. China, we'd like to be slightly more open to China.

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The PM went to China, I thought it was the right thing to do.

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People who are worried that we want a strategic relationship with China

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I think are dreaming in technicolour. There is no way at this point...

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Strategic meaning?

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Meaning an all-encompassing relationship as opposed to one that is focused on

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trade or tourism or something else.

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We have a strategic relationship with England, we have a strategy relationship

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with Australia. It would be a big step for anybody to

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honestly think we want a strategic relationship with China,

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but we do want to be a little closer with China than Trump wants us to be.

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I don't know what the current Canadian government's thinking is but we've

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always tried to be supportive of Cuba, for example.

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Now, I don't think we're going to load up tankers and take them to Cuba but I'd

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like to think we might gently push back and say, this should not add to the

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suffering of the Cuban people.

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So we're going to have to be, to use a medical term, and I don't mean

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this in a nasty way, schizophrenic.

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We're going have to hold a whole bunch of things in our mind at the same time

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and be prepared I think also to bring the country along.

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Everybody in Canada, by and large, likes Mr. Carney's speech.

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Well, some people think that it actually alienates the United States and that's

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not good for trade.

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I think it did. I think I did to some degree and I think it's almost impossible

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to not alienate the United States today unless you're being flattering.

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I don't think that is a sustainable view.

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The United States these days seem to be very keen on receiving kudos

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across the board. I think they deserve some on a whole raft of things but we

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just don't agree on some of the things they're doing.

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It's a balancing act.

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I think Carney's speech overall probably was useful,

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to go back to your question, as part of the package of tools that

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we have available to deal with CUSMA.

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We'll see how CUSMA comes out. I don't think anybody knows right now.

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Do we in advance of that, this is sort of a timeline question

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but the idea of a cohesive national security,

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I don't know if you've put defence in there as well but that the industries,

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the actual companies themselves and the government funding to help with growth,

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your term was joined at the hip. Thet were all moving in the same direction.

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Do we have to wait till the end of the trade negotiations to figure out what

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that is or should we actually signal what our identity is first?

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Oh, I think we have to start now because it will help us in the negotiations.

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Are we going to get there before July?

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That's a good question. I think a lot of negotiations take a while.

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You can start off with, I'm making a joke but

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arguing about the shape of the table.

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It takes a while to get going.

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When I say worry about national security I really think about our capacity to

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protect our national sovereignty, which means our capacity to make our own

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decisions. As a middle power I think that if

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we combine and integrate and mutually reinforce

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foreign defence, economic trade, security,

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border control, and a few other things into a coherent whole

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it reinforces our ability not just to deal with CUSMA but to deal with the

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world. For example, we have an Indo-Pacific strategy

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which Mr. Trudeau's government developed.

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I think it's a pretty decent strategy although it required

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more resources than I think it got in the end.

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We developed this in the absence of a broader foreign policy.

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That's interesting. So it was more piecemeal.

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Yeah, and I don't think in this world at the strategic level you can

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go piecemeal. I think you have to be as coherent as you can, particularly

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because we're not a superpower.

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That's really interesting because at the same time it's the exact opposite,

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how can it be coherent when it's suddenly going to be diversifying across,

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I mean, many handfuls of nations, it sounds like.

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It is not going to America first in terms of a trade, or

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it might not be so, in fact, it needs to hold so many other

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things at the same time, meaning countries and alliances and friendships,

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essentially. I think he talked about it as a web, Mr. Carney.

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I think what we need to do, when I'm talking about a coherent set of policies

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it's that coherent set up prioritizations that will enable us to say,

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well, on foreign policy we're going to pick three or four countries in Asia,

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a couple in South America and maybe one or two

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in the Middle East, which we should not ignore.

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I think if in the absence of that...

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And Europe.

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And Europe, of course, sorry.

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In the absence of a coherent

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worldview, for lack of a better way, it doesn't have to be 6,000 pages

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but it needs to be a coherent view. You then start extracting, well, on defence

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we really, really should, for example, develop our relationships with the

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Nordic countries. They're worried about Russia, they're very developed from a

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defence sense.

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From trade we might say, well, maybe it's Indonesia.

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You pick and choose and prioritize the

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extent to which you want to deal.

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To go back to the beginnings of your question, I think this is something the

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government can do but we are not going to be successful in developing

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a fully effective national security policy if the

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government isn't able to bring along parliament, the private sector and

17:56.175 --> 17:58.310
civil society.

17:58.310 --> 18:00.913
Government can do one heck of a lot in order to promote trade.

18:00.913 --> 18:04.049
They can have trade deals, they can have tax packages, they could do a whole

18:04.049 --> 18:07.986
bunch things but if the private sector isn't saying, yes,

18:07.986 --> 18:12.124
I see an opportunity here and pursue it, it's all for naught.

18:12.124 --> 18:15.327
It has to be, I think, a symbiotic relationship.

18:15.327 --> 18:19.031
It exists in some sectors of the economy,  I'm not a trade expert but it exists

18:19.031 --> 18:22.367
in some of the sectors of economy. In others, not so much.

18:22.367 --> 18:26.205
We need to build that if we're going to develop that relative independence you

18:26.205 --> 18:27.239
were asking about.

18:27.239 --> 18:31.243
It comes out of the ground, it then possibly gets refined, whatever it is, then

18:31.243 --> 18:33.979
gets used to build ...

18:33.979 --> 18:37.049
if it's copper it's going to get used in pretty much everything but something

18:37.049 --> 18:42.287
technological, if it's steel maybe it goes to cars, maybe we develop

18:42.287 --> 18:46.391
... there have been various discussions about EVs, this is part of the

18:46.391 --> 18:50.362
trade talks that Mr. Carney held with China, we're going to buy a

18:50.362 --> 18:54.933
certain number, 49,000 EVs from China, sell them.

18:54.933 --> 18:58.403
In one point of view, I think it was in the Globe and Mail, said to see whether

18:58.403 --> 19:02.508
Canadians buy them up, whether we care, whether we want them, and

19:02.508 --> 19:06.178
then maybe we'll build our own if there seems to be an appetite for it.

19:06.178 --> 19:09.481
It's sort of this chain, creating our own supply chains to some extent.

19:09.481 --> 19:12.851
I think that's right but I would argue that we didn't agree to bring in, is it

19:12.851 --> 19:13.552
50,000 Chinese...

19:13.552 --> 19:16.021
I think it was 49, just under 50,000.

19:16.021 --> 19:17.756
I don't think we did it for that reason.

19:17.756 --> 19:20.592
I think we did it because if we didn't agree to that we weren't going to get an

19:20.592 --> 19:24.496
agreement with the Chinese. The Chinese are very tough bargainers.

19:24.496 --> 19:28.100
They're very good at what they do.

19:28.100 --> 19:33.105
We're letting in some 50,000 EVs and then we're going to have to decide ...

19:33.105 --> 19:36.842
they're going to be, I understand, quite a bit less expensive than some that we

19:36.842 --> 19:40.379
have now so individuals will have to make their own choices.

19:40.379 --> 19:43.749
A lot of people in this country don't have a surfeit of money so some of them

19:43.749 --> 19:47.419
are going to buy Chinese EVs.

19:47.419 --> 19:51.456
If they're all sold, not overnight, but over a period of time we're going to

19:51.490 --> 19:55.427
to decide what to do because this is annoying to

19:55.427 --> 20:00.299
the United States, to put it mildly, that we're sort of breaking the

20:00.299 --> 20:05.804
barrier that they're trying to construct between the West and China.

20:05.804 --> 20:09.808
But then, to your point, there's nothing on this

20:09.808 --> 20:13.111
planet that prevents us from building our own EVs.

20:13.111 --> 20:17.182
If you listen to Ontario's Premier, Doug Ford, he's ready to

20:17.182 --> 20:19.818
do it with his colleagues in the private sector now.

20:19.818 --> 20:21.220
We have...

20:21.220 --> 20:22.888
With the Ring of Fire and it becomes the whole chain.

20:22.888 --> 20:26.758
Yeah, and all of that. We certainly have the technological capacity to produce

20:26.758 --> 20:30.929
all we need and if we're lucky and entrepreneurial eventually start

20:30.929 --> 20:33.332
exporting them elsewhere.

20:33.332 --> 20:37.402
One of the issues I think that we've been sort of dancing around a little

20:37.402 --> 20:41.006
bit in our conversation is that none of this is going to happen tomorrow.

20:41.006 --> 20:43.208
These things take time.

20:43.208 --> 20:47.145
I think part of the issue is going to be for 2026 is

20:47.145 --> 20:51.183
that people are going to have to accept it takes a bit of time and some of

20:51.183 --> 20:53.352
this timeframe may involve a little bit of pain.

20:53.352 --> 20:57.189
I don't think it's going to destroy the country or people in it but you cannot

20:57.189 --> 21:01.293
turn 180 degrees in most sectors

21:01.293 --> 21:04.896
of the economy overnight.

21:04.896 --> 21:09.735
But what you could do is draft up the national security

21:09.735 --> 21:14.306
policy that would then direct actually putting that all together and

21:14.339 --> 21:17.209
have that framework in a shorter period of time.

21:17.209 --> 21:18.176
Absolutely.

21:18.176 --> 21:20.279
Is that happening or...

21:20.279 --> 21:23.315
I'd like to think it is. There's been a rumour around Ottawa for some months

21:23.315 --> 21:27.419
now that they have a national security policy sitting on somebody's

21:27.419 --> 21:31.657
desk somewhere and they haven't been quite relaxed about putting it out, in

21:31.657 --> 21:35.594
part, I think, because of Mr. Trump's ability

21:35.594 --> 21:38.230
to move around very quickly.

21:38.230 --> 21:41.099
I think it's absolutely possible. If the government decided tomorrow, the

21:41.099 --> 21:45.003
federal government decided tomorrow that it wanted a comprehensive national

21:45.003 --> 21:48.240
security policy of the type we were talking about it could be done in six

21:48.240 --> 21:49.941
months. It really could be.

21:49.941 --> 21:53.545
You'd want to have a few consultations with the provinces at a fairly high

21:53.545 --> 21:55.647
level, maybe get a...

21:55.647 --> 21:57.015
Maybe that happened last week.

21:57.015 --> 21:59.951
Could be, I don't know, but it's doable.

21:59.951 --> 22:04.489
I think once you've done that you then decide, you know,

22:04.489 --> 22:08.527
when I was still working I think we identified 13 critical sectors of the

22:08.527 --> 22:10.195
economy for a variety of purposes.

22:10.195 --> 22:11.963
Can you name them? Don't worry.

22:11.963 --> 22:14.266
I'll name some of them because I won't remember them all.

22:14.299 --> 22:18.270
I mean, nuclear was one, electrical, oil, gas, financial,

22:18.270 --> 22:22.541
there are a number of others that were judged to be critical to the country.

22:22.541 --> 22:25.844
Most of them are pretty obvious.

22:25.844 --> 22:28.280
You then say to yourself, if you've got these, I don't know if there's still

22:28.280 --> 22:32.517
13, there may be more, there may be fewer, are we doing enough in those sectors

22:32.517 --> 22:36.555
of the economy to push the national security framework?

22:36.555 --> 22:38.724
I'm making it sound simple. It's not easy.

22:38.724 --> 22:41.960
There's a lot of discussion, there's lot of detailed work.

22:41.960 --> 22:45.897
But it needs to happen and in your view, if I've got this right, it

22:45.897 --> 22:46.998
has not happened.

22:46.998 --> 22:50.969
Not entirely. I mean, over the years the government has, for

22:50.969 --> 22:54.940
example, on the cyber side they've talked to and pushed the financial

22:54.940 --> 22:58.944
sector, the nuclear sector and a few other sectors to do a variety of

22:58.944 --> 23:02.381
things that needed to be done. In some cases they've given them help, in other

23:02.381 --> 23:06.051
cases they haven't. Some sectors are further ahead than others and they

23:06.051 --> 23:09.621
reflect, I think, the priorities that we probably would have today.

23:09.621 --> 23:13.558
Whether it's true across the 13 and beyond those 13, I

23:13.558 --> 23:14.960
honestly don't know.

23:14.960 --> 23:18.163
Hello, investors. We'll be back to the show in just a moment.

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DialoguesFidelity podcasts available on Apple, Spotify, YouTube, or wherever

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else you get your podcasts. Now back to today's show.

23:46.591 --> 23:51.029
Do you think that Canadians are at a point, or will this be part of the policy

23:51.029 --> 23:55.066
... you'll read in Europe that in

23:55.066 --> 23:59.037
order to increase defence spending they've had to sacrifice

23:59.037 --> 24:02.574
an entire other piece of the national budget and in some cases it's almost

24:02.574 --> 24:05.844
shocking, it seems like a very serious ...

24:05.844 --> 24:08.380
it's not an entitlement, it's a big piece of the budget.

24:08.380 --> 24:10.982
Are we ready to do that here?

24:10.982 --> 24:14.352
Well, I think we're going to have to whether we like it or not.

24:14.352 --> 24:18.557
The government has identified a clear policy intention

24:18.557 --> 24:22.894
to reach 5.5% in a few years, some of which is for R&D

24:22.894 --> 24:26.731
which is good for everybody in the private sector and in academe.

24:26.731 --> 24:32.137
We have been underspending in defence for a long, long time.

24:32.137 --> 24:35.507
I was the Deputy Minister of Defence for a little while and we had something

24:35.507 --> 24:37.476
like 19 or 20 billion.

24:37.476 --> 24:40.812
I think we're closer to 30 now and we want to get to 60.

24:40.812 --> 24:43.515
That's a big jump.

24:43.515 --> 24:45.517
How do you spend it all?

24:45.517 --> 24:49.855
You buy 12 submarines, 78

24:49.855 --> 24:53.792
fighters and then, in fact, you have a problem that if you

24:53.792 --> 24:57.829
spend on these huge, huge purchases, which are necessary,

24:57.829 --> 25:01.933
what do you do to provide the Army with trucks and jeeps, or the Air

25:01.933 --> 25:03.702
Force with tactical helicopters?

25:03.702 --> 25:06.304
And raises.

25:06.304 --> 25:10.375
It's a lot of money. If I read the polling correctly I think Canadians have

25:10.375 --> 25:14.846
been prepared to say, yes, we need to do this.

25:14.846 --> 25:18.416
I think one of our challenges is going to be, we have this agreement with

25:18.416 --> 25:22.420
Europe that our companies can sell things in Europe

25:22.420 --> 25:24.122
and vice versa.

25:24.122 --> 25:27.492
Part of the challenge right now is simply the availability of the industrial

25:27.492 --> 25:30.829
capacity to provide defence equipment because the Europeans are going through

25:30.829 --> 25:31.863
exactly the same thing.

25:31.863 --> 25:33.765
The factories aren't built to build the things.

25:33.765 --> 25:36.668
Or if they are they're way too small.

25:36.668 --> 25:40.472
Again, all of this fixable, it really is fixable, it's just it takes a little

25:40.472 --> 25:43.041
while and a little bit of money.

25:43.041 --> 25:46.177
Maybe they should issue, finally, a Eurobond.

25:46.177 --> 25:48.113
Who knows?

25:48.113 --> 25:51.917
It's only taken them ... they find ways not to issue Eurobonds daily but maybe

25:51.917 --> 25:53.385
this is the moment.

25:53.385 --> 25:57.322
Sometimes you take advantage of crises. There are a

25:57.322 --> 26:01.726
lot of things that we might have done over the years and we wait

26:01.726 --> 26:05.764
... to give you a small example, 9-11 seems a long time ago,

26:05.764 --> 26:09.801
we fundamentally changed Canada's national security law because we had to

26:09.801 --> 26:13.104
do it, and we'd been talking about it for 10 years beforehand.

26:13.104 --> 26:17.742
If you have a real crisis, not that I'm arguing that we need crises,

26:17.742 --> 26:21.246
but you should take advantage of every component of that crisis, including

26:21.246 --> 26:25.984
dealing with the crisis, to move a variety of files, and your Eurobond may

26:25.984 --> 26:26.751
well be one of them.

26:26.751 --> 26:30.288
Maybe they'll finally issue one. Probably much of the world would take a look

26:30.288 --> 26:33.658
at buying it. Tell us a little bit something that all of us don't know.

26:33.658 --> 26:36.761
You're speaking to financial advisors and we all are interested.

26:36.761 --> 26:40.699
The Five Eyes are the countries that we

26:40.699 --> 26:44.836
share intelligence and we take their intelligence and it's a tight-knit group.

26:44.836 --> 26:48.807
Does it shift at all with the discussion of alliances

26:48.807 --> 26:52.377
in the world shifting? Are you concerned that it'll be the Four Eyes or

26:52.377 --> 26:53.578
something else?

26:53.578 --> 26:57.582
I think everybody believes and hopes the Five Eyes will survive.

26:57.582 --> 27:03.588
Which are Australia, Canada, New Zealand, UK and the US.

27:03.588 --> 27:09.694
The US being the senior partner followed I think quickly by the United Kingdom.

27:09.694 --> 27:13.665
I think one of the things about the Five Eyes is that it's almost

27:13.665 --> 27:17.602
in our DNA. It developed during World War II and a lot of it I think

27:17.602 --> 27:21.339
will survive virtually anything.

27:21.339 --> 27:24.743
You'll remember some years ago we had a big disagreement with the United States

27:24.743 --> 27:28.079
about Canada joining them on the war in Iraq.

27:28.079 --> 27:31.783
People were really worried whether that would have the impact of breaking the

27:31.783 --> 27:35.820
Five Eyes, and it did not because a lot of the stuff, the sharing that

27:35.820 --> 27:39.557
takes place takes place beneath the political level.

27:39.557 --> 27:42.394
I would argue that aside from that ...

27:42.394 --> 27:44.629
you get all sorts of information from the Five Eyes.

27:44.629 --> 27:48.800
You get economic information, intelligence, political intelligence, the

27:48.800 --> 27:51.970
intelligence that's really important from a nation state's perspective is

27:51.970 --> 27:55.974
threat intelligence. Is there a threat being directed at Canada or Australia or

27:55.974 --> 27:59.978
the United Kingdom, I have great deal of difficulty are

27:59.978 --> 28:03.281
ever declining to give the United States threat information and vice versa.

28:03.281 --> 28:07.285
If that chunk continues as is,

28:07.285 --> 28:11.456
and beneath the political level stuff continues, I mean the UK has

28:11.456 --> 28:14.759
said the other day that they were reluctant to share intelligence with the

28:14.759 --> 28:17.262
Americans because of what they were doing with Venezuela.

28:17.262 --> 28:19.297
I don't think we've got to that point.

28:19.297 --> 28:23.401
I rather think the Five Eyes will survive but there might be

28:23.401 --> 28:26.971
little carve-outs because of particular concerns.

28:26.971 --> 28:28.640
I think it's been very, very valuable.

28:28.640 --> 28:32.644
The other thing people forget, there's that Five Eyes, there's also an

28:32.644 --> 28:35.780
immigration Five Eyes and a customs Five Eyes.

28:35.780 --> 28:39.784
They really do serve everybody's benefit not just the United States.

28:39.784 --> 28:43.888
In the case of the traditional Five Eyes that you were talking about,

28:43.888 --> 28:45.957
the United States is the major contributor.

28:45.957 --> 28:50.028
On customs and immigrations and things like that it's more

28:50.028 --> 28:52.397
of an equal sharing of information from around the world.

28:52.397 --> 28:56.801
I hope, I think there's a general agreement that it's worthwhile.

28:56.801 --> 29:00.805
So here's a question coming in about AUKUS which is the intelligence

29:00.805 --> 29:04.309
organization. This is back during the pandemic.

29:04.309 --> 29:06.077
Why was Canada not invited?

29:06.077 --> 29:08.213
Because we didn't have anything to offer, basically?

29:08.213 --> 29:10.348
We seemed to take that as a blow.

29:10.348 --> 29:15.386
Well, I think it was a realistic assessment of where the then government was.

29:15.386 --> 29:20.058
Mr. Trudeau's government made a number of significant investments in defence

29:20.058 --> 29:24.229
but, generally speaking, I don't think his government accorded

29:24.229 --> 29:27.198
defence a great deal of priority.

29:27.198 --> 29:29.134
Maybe because it didn't have to.

29:29.134 --> 29:32.403
Possibly, you may well be right, but in the end they didn't.

29:32.403 --> 29:36.608
It would have required us to invest in a variety of things that

29:36.608 --> 29:40.211
we probably didn't want to spend the money on.

29:40.211 --> 29:43.114
I think in the end ...

29:43.114 --> 29:47.218
people were going on about the Australians

29:47.218 --> 29:48.920
acquiring nuclear-powered submarines.

29:48.920 --> 29:52.657
I don't think we're going to go that route.

29:52.657 --> 29:55.527
We seem to have decided as a country this is not a good thing.

29:55.527 --> 29:57.395
That sort of took over everything.

29:57.395 --> 30:00.298
But there's a component to that agreement dealing with R&D.

30:00.298 --> 30:05.136
I don't see why we couldn't deal with R&D in a few other specialized area.

30:05.136 --> 30:07.872
I wasn't insulted when this happened, it would have been nice to have been

30:07.872 --> 30:11.976
invited, but honestly, at that time our government wasn't very

30:11.976 --> 30:14.512
keen on that kind of defence activity.

30:14.512 --> 30:17.382
I think our allies read that.

30:17.382 --> 30:20.885
And now would it be changed?

30:20.885 --> 30:24.022
I was going to ask you actually broadly about sort of the international

30:24.022 --> 30:28.626
organizations that may shift around, I mean, the WTO, these

30:28.626 --> 30:32.764
organizations have piles of cash in them that maybe even if

30:32.764 --> 30:36.534
hegemonic powers change around they still want to keep that as an organization,

30:36.534 --> 30:40.305
and maybe some they want to throw right out the window.

30:40.305 --> 30:43.007
We could talk about AUKUS and then sort of spread out from there.

30:43.007 --> 30:44.475
Do you think we're more interested in it now?

30:44.509 --> 30:47.979
I think we would be because I think we've indicated clearly we want our own

30:47.979 --> 30:52.083
defence policy and we're prepared to spend the money.

30:52.083 --> 30:56.054
Now, in order for us to join that trilateral group we would need

30:56.054 --> 31:00.124
the United States agreement. I don't see why they would not agree,

31:00.124 --> 31:04.562
off the top of my head, but you never know.

31:04.562 --> 31:08.466
We've changed our attitude towards defence, I really think we have.

31:08.466 --> 31:12.403
By signalling the amount of money that we're spared to spend we've been putting

31:12.403 --> 31:15.907
our, what's the expression, our money where our mouths are, is.

31:15.907 --> 31:19.611
I think that message is there so I think we would be more likely to be invited

31:19.611 --> 31:23.548
today. But then we're going to have to ask ourselves, going back

31:23.548 --> 31:28.052
to our earlier conversation and our prioritization exercise, do we want to do

31:28.052 --> 31:32.223
this particular alliance or do we want to really ratchet up

31:32.223 --> 31:34.726
NATO or do we want to do something else?

31:34.726 --> 31:38.763
Is the glue for NATO going forward in 2026 and beyond

31:38.763 --> 31:40.198
the Arctic?

31:40.198 --> 31:43.034
I think it's the Arctic/Russia.

31:43.034 --> 31:43.935
Which is the Arctic.

31:43.935 --> 31:45.670
Yes, absolutely.

31:45.670 --> 31:51.943
We tend to forget that our issue with the Arctic is that it's a border.

31:51.943 --> 31:55.413
The Nordic countries have all reinstated conscription because they're so

31:55.413 --> 31:58.316
worried about Russia. I think...

31:58.316 --> 31:59.550
That's my next question.

31:59.550 --> 32:03.655
We tend to forget that actually the Canadian Arctic is part

32:03.655 --> 32:07.892
of NATO. When we defend NATO or we ask the Swedes

32:07.892 --> 32:12.263
to come and help us defend NATO we're defending NATO.

32:12.263 --> 32:16.434
As worrisome, I think, as is China

32:16.434 --> 32:21.039
from a variety of perspective our close my strategic

32:21.039 --> 32:22.974
adversary is Russia.

32:22.974 --> 32:24.075
Because we border it.

32:24.075 --> 32:25.810
Yeah, exactly, exactly.

32:25.810 --> 32:26.344
We border it across that piece of water, ice.

32:26.344 --> 32:30.915
I think they've demonstrated by what they're doing in Ukraine that they're not

32:30.915 --> 32:33.217
particularly friendly to the West.

32:33.217 --> 32:37.422
Hoing back to my earlier point, there's no doubt that China pushes its

32:37.422 --> 32:41.626
influence and it pushes its view of the world but they tend not

32:41.626 --> 32:45.596
to take over countries like Ukraine.

32:45.596 --> 32:48.967
One of the things we have to do if we develop this you know umbrella national

32:48.967 --> 32:51.869
security policy is I think decide is the...

32:51.869 --> 32:55.907
Is that called the Golden Dome, or is that not necessarily...

32:55.907 --> 32:59.744
No, no, no. No, that's another one. We have to decide, going back to my point

32:59.744 --> 33:04.349
about Indo-Pacific, is that going to be a priority or are we going to say,

33:04.349 --> 33:08.119
Europe is more important than Indo-Pacific what do we do with Latin America and

33:08.119 --> 33:11.589
what do we do with the Middle East? We cannot act at the same level in all of

33:11.589 --> 33:15.560
them. In the absence of deciding that there's this

33:15.560 --> 33:19.564
package the government of the day, and this isn't a criticism

33:19.564 --> 33:22.266
it's just reality, they're going to have to decide if there's a crisis in the

33:22.266 --> 33:26.904
Middle East what are we gonna do? Will we have allocated

33:26.904 --> 33:30.908
time, money, intellectual power and resources to thinking about

33:30.908 --> 33:33.978
the Middle East as much as Russia.

33:33.978 --> 33:37.849
We have limited resources. We can do a whole bunch of things but we can't do

33:37.849 --> 33:42.320
everything to the tune of 120%, I think.

33:42.320 --> 33:46.557
Unless I've got this wrong, for instance, taking a look at Indonesia

33:46.557 --> 33:50.528
and other ASEAN countries and the Middle East, I think

33:50.528 --> 33:54.899
are a trading discussion which is more about do we build a great big

33:54.899 --> 33:59.303
port so our companies can ship things like canola better

33:59.303 --> 34:03.541
and do that more, whereas the

34:03.541 --> 34:06.244
protection and the defence story is NATO.

34:06.244 --> 34:08.212
I mean, that's where [crosstalk].

34:08.212 --> 34:12.417
I think that's right. There's real trade and economic potential

34:12.417 --> 34:15.720
in Asia, there really is.

34:15.720 --> 34:19.690
I think the fact that the PM has visited these countries proves that.

34:19.690 --> 34:23.094
One of the things that I found when I was still working ...

34:23.094 --> 34:25.329
I travelled in these countries.

34:25.329 --> 34:28.066
I bet you did. You've done all kinds of things.

34:28.066 --> 34:32.136
Most of them, though, didn't want just one

34:32.136 --> 34:35.606
chunk of a relationship. They were happy to trade with us.

34:35.606 --> 34:39.477
They wanted to be treated like a big country that had a range of relationships

34:39.477 --> 34:43.381
that we talk to them about what's going on at the UN, that we talk to them if

34:43.381 --> 34:46.984
we were going to have a major crisis in the WHO.

34:46.984 --> 34:50.288
I think if we do what you're suggesting, and I think we should, we should build

34:50.288 --> 34:54.659
those ports, we should develop a capacity to export towards Asia,

34:54.659 --> 34:58.596
I think that we have to accept that we will be more successful with those

34:58.596 --> 35:02.867
countries if we broaden our perspective of them, in particular

35:02.867 --> 35:06.871
because a lot of them are not full democracies in the same way

35:06.871 --> 35:11.008
that we think of and they tend to be more demanding in terms of what they

35:11.008 --> 35:12.710
want from their partners.

35:12.710 --> 35:15.713
That's really interesting. As you say, if you're having a conversation that has

35:15.713 --> 35:19.450
to do with trade you want the dinner party to be able to talk about other

35:19.450 --> 35:23.054
things as well and not have sort of a curtain come down, oh, nope, that goes

35:23.054 --> 35:28.292
over into national defence or that sort of thing.

35:28.292 --> 35:31.629
This is sort of what you're talking about, this question coming in, what's your

35:31.629 --> 35:35.633
level of optimism that the middle power, so-called, will heed the

35:35.633 --> 35:39.737
call, be coherent,

35:39.737 --> 35:41.339
that web will form.

35:41.339 --> 35:45.843
I think it's going to have to, and it will, the question is the degree.

35:45.843 --> 35:49.347
I think most of the world has now accepted that the United States is

35:49.347 --> 35:53.618
withdrawing a little bit and they will see their interests

35:53.618 --> 35:55.353
in developing alternatives.

35:55.353 --> 35:59.390
Now, I don't think that will mean necessarily a rupture with the United States

35:59.390 --> 36:03.394
but it will mean, I think like we have done, we Canada have

36:03.394 --> 36:07.598
done, talking to China. The British Prime Minister was just in Beijing last

36:07.598 --> 36:10.301
week, I think it was, or this week.

36:10.301 --> 36:14.238
I think we're going to see more of that. To go to your point

36:14.238 --> 36:19.043
earlier about international institutions, the

36:19.043 --> 36:23.047
Security Council has been gridlocked for a long time because of the vetoes but

36:23.047 --> 36:27.018
a lot of the specialized institutions, the WHO, the World

36:27.018 --> 36:30.621
Food Program have made real contributions to the planet.

36:30.621 --> 36:34.659
The United States last week or the week before withdrew from

36:34.659 --> 36:39.363
the WHO. That is a significant and I think--

36:39.363 --> 36:41.566
That's an interesting warning shot.

36:41.566 --> 36:44.969
--that's a bad thing because they provide a lot of funding.

36:44.969 --> 36:49.140
I think the rest of the world is going to want the WHO to survive but if we

36:49.140 --> 36:53.110
want it to survive even closely to the way that it has we're going

36:53.110 --> 36:57.014
to have to up our contributions. So even in the...

36:57.014 --> 36:58.316
And China could step into the vacuum.

36:58.316 --> 37:00.918
They could. They're already a member and maybe they'll do more.

37:00.918 --> 37:04.889
I think in all of these cases if we have an international institution

37:04.889 --> 37:09.093
that's doing good, generally speaking, and it's not geopolitical

37:09.093 --> 37:11.629
I think it's in everybody's interest to maintain it.

37:11.629 --> 37:15.633
In fact, if China becomes more active in some of these

37:15.633 --> 37:19.737
institutions and we start engaging them in dialogue there's

37:19.737 --> 37:22.106
nothing wrong with that. There's an advantage to doing that.

37:22.106 --> 37:26.177
The World Food Program, the WHO,

37:26.177 --> 37:30.114
something as nutty as the World Meteorological Organization, knowing about the

37:30.114 --> 37:36.254
weather worldwide is not unhelpful.

37:36.254 --> 37:36.821
No kidding. As we sit in minus whatever and shivering away.

37:36.821 --> 37:40.224
All of these institutions, I think the middle powers will pull together.

37:40.224 --> 37:44.161
To our earlier point, not necessarily next week but I'm really

37:44.161 --> 37:45.663
quite encouraged.

37:45.663 --> 37:50.201
What are the trade routes

37:50.201 --> 37:54.739
that get opened up with something that goes on in Iran?

37:54.739 --> 37:56.774
There are an awful lot of American ships there.

37:56.774 --> 37:59.310
It looks like there could be something that happens.

37:59.310 --> 38:01.612
We don't know what it'll all mean.

38:01.612 --> 38:05.650
There's an entryway into sort of Central Asia, essentially, south of Europe

38:05.650 --> 38:09.787
that's is at stake for trade, has been discussed for

38:09.787 --> 38:13.524
a long, long time, whether it actually becomes an alliance and the Stans all

38:13.524 --> 38:17.828
link up and can go from the Arabian Sea to the Black Sea to the Mediterranean

38:17.828 --> 38:20.598
and there's routes.

38:20.598 --> 38:22.733
Tell us what we're watching on that front.

38:22.733 --> 38:26.537
I know there's political discussions but there's other stuff at stake.

38:26.537 --> 38:29.573
I think the first thing to remember from that part of the world is that to move

38:29.573 --> 38:33.611
things, goods, you need

38:33.611 --> 38:35.313
land routes and sea routes.

38:35.313 --> 38:39.250
The minute you need both it becomes more complicated.

38:39.250 --> 38:43.587
If you want to get something shipped across the black sea to

38:43.587 --> 38:46.857
Europe, which is the objective of a lot of people because Europe is a huge

38:46.857 --> 38:51.629
market, in many cases you've got to go through or around

38:51.629 --> 38:55.399
Iran. Iran these days I don't think is particularly amenable to anybody going

38:55.399 --> 39:00.504
near them. If the United States does anything in a kinetic sense against

39:00.504 --> 39:03.007
Iran I think there's a real chance that part of the world's going to blow up.

39:03.007 --> 39:06.744
I don't mean in a nuclear sense but I think there is a real possibility of a

39:06.744 --> 39:06.811
problem.

39:06.811 --> 39:12.350
It's very intertwined. If you pull on the string too hard...

39:12.350 --> 39:15.986
The Stans vary as well in, not that I'm an expert in that part of the world but

39:15.986 --> 39:19.490
some are relatively developed, some have a lot of oil and whatnot, others quite

39:19.490 --> 39:23.928
a bit less so. If they are going to prosper

39:23.928 --> 39:27.898
they have to find a way of not irritating

39:27.898 --> 39:31.135
Russia too much as well because the Stans used to be part of Soviet Union so

39:31.135 --> 39:34.672
they have to maneuver their independence as well.

39:34.672 --> 39:39.477
They have to find routes. They have to find ways of selling things.

39:39.477 --> 39:42.913
I think they should try and to the extent the West can help them we should but

39:42.913 --> 39:45.783
the fact that they need land routes and sea routes to get to where they want to

39:45.783 --> 39:50.187
go, it's complicated particularly because the Black Sea borders Ukraine

39:50.187 --> 39:52.823
and all the trouble that's going on there.

39:52.823 --> 39:57.228
The shipping routes could be very difficult to protect, essentially.

39:57.228 --> 39:57.395
Indeed.

39:57.395 --> 40:00.398
Let's talk a little bit about shipping routes here across Great Lakes.

40:00.398 --> 40:04.902
Do you see anything in a national security thing happening there?

40:04.902 --> 40:08.873
I really don't. There's a long, longstanding treaty with the

40:08.873 --> 40:13.844
United States which basically demilitarizes the Great Lakes.

40:13.844 --> 40:17.982
I've heard nothing to suggest that the mutual benefits,

40:17.982 --> 40:22.820
and it really is mutual, the movement of goods across.

40:22.820 --> 40:27.491
To use bad English, it isn't just one way it's both ways.

40:27.491 --> 40:31.495
I would be honestly surprised if something affecting the Great

40:31.495 --> 40:32.229
Lakes occurred.

40:32.229 --> 40:34.165
That's really interesting.

40:34.165 --> 40:36.066
Are we going to have an election in this country?

40:36.066 --> 40:38.836
We have a minority government.

40:38.836 --> 40:42.940
Pierre Poilievre has just been overwhelmingly

40:42.940 --> 40:47.778
given huge confidence to take the Conservative Party forward, what

40:47.778 --> 40:49.246
do you think?

40:49.246 --> 40:52.049
Well, I'm not a politician but I've hung around prime ministers and ministers

40:52.049 --> 40:56.053
for most of my career. I would say there's a decent chance of it

40:56.053 --> 41:00.357
because a minority parliament, even if Mr. Carney's government acquire

41:00.357 --> 41:06.096
another one or two MPs from the Conservatives, it is inherently unstable.

41:06.096 --> 41:10.167
Given everything that we've been talking about, if I were prime

41:10.167 --> 41:13.671
minister, and I will never be, I would look at my numbers in April and May.

41:13.671 --> 41:16.273
Maybe you will be. Maybe you're just exactly what we need.

41:16.273 --> 41:18.042
I don't think so. I think the country's safe.

41:18.042 --> 41:22.246
If I were the Liberal Party I would look at the polling

41:22.246 --> 41:26.217
numbers in April and May and if Mr. Carney is as far ahead

41:26.217 --> 41:32.323
as he is now I think we'll have an election.

41:32.323 --> 41:38.195
It is particularly likely because I see with

41:38.195 --> 41:41.999
a lot of difficulty the NDP resurrecting itself.

41:41.999 --> 41:46.103
Yes, Mr. Poilievre has received resounding support

41:46.103 --> 41:50.241
from his convention but all of the pundits are saying he

41:50.241 --> 41:54.278
still hasn't demonstrated yet that he can broaden his base.

41:54.278 --> 41:59.350
If he continues along that path I

41:59.350 --> 42:02.586
would argue ... and I'm not partisan, I've had that beaten out of me after 40

42:02.586 --> 42:06.624
years as a public servant, both sides, I

42:06.624 --> 42:10.928
would say it is in the national interest to have a majority government.

42:10.928 --> 42:13.297
Because there's a lot of projects to push through.

42:13.297 --> 42:16.467
If every time you want to get a statute through parliament you have to, you

42:16.467 --> 42:18.736
know, there's always some negotiation.

42:18.736 --> 42:22.706
I don't mean to suggest that it's quite that black and white but

42:22.706 --> 42:27.278
given the difficulties of dealing with Mr. Trump, to

42:27.278 --> 42:33.417
just paint a simplistic scenario we're negotiating something with Trump

42:33.417 --> 42:37.187
and he says, well, you can have CUSMA but you've got to do these two things and

42:37.187 --> 42:40.891
both things require legislative change and we have a minority parliament.

42:40.891 --> 42:43.861
May well get there but it could take a long, long time.

42:43.861 --> 42:47.765
I'm not suggesting just because there's a majority the government should get

42:47.765 --> 42:51.802
everything that it wants but at least it provides it and our

42:51.802 --> 42:56.307
allies and negotiating partners with a measure of certainty that

42:56.307 --> 42:57.975
they can move the file.

42:57.975 --> 43:01.312
You were at Natural Resources for a long time, the Department of Natural

43:01.312 --> 43:05.115
Resources. You've seen us through a different super cycle.

43:05.115 --> 43:08.485
Do you think we're entering another super cycle?

43:08.485 --> 43:11.388
What do you mean by super cycle just so I make sure I understand.

43:11.388 --> 43:15.426
That the insatiable demand for commodities out of the ground that we

43:15.459 --> 43:18.095
have to sell to various places.

43:18.095 --> 43:23.801
I think so. Mostly because China

43:23.801 --> 43:25.736
has a lot of the same things we have.

43:25.736 --> 43:29.073
Not forestry but a lot of other things.

43:29.073 --> 43:32.610
They are being very parsimonious in deciding to whom they're going to sell

43:32.610 --> 43:34.778
them.

43:34.778 --> 43:38.749
I think we have more mineral resources than virtually any other

43:38.749 --> 43:41.752
country in the world. Our problem is, of course, none of them are easily

43:41.752 --> 43:45.255
accessible. I think, yes, there will be a demand.

43:45.255 --> 43:49.360
Mr. Ford's Ring of Fire efforts,

43:49.360 --> 43:53.564
there is gold, there are any number of things, including oil

43:53.564 --> 43:57.568
and gas, which we can meet, I think, a

43:57.568 --> 44:01.672
world demand. The way the world is going right now I think

44:01.672 --> 44:05.876
demand is going to continue increasing. It's not going to diminish at all.

44:05.876 --> 44:10.080
Just as a slight aside, everybody is applauding AI, I'm

44:10.080 --> 44:14.418
sure you and I do, but the energy and the water demands

44:14.418 --> 44:19.023
to support AI are going through the roof.

44:19.023 --> 44:22.960
The world is going to have to find a way to provide the power for all of these

44:22.960 --> 44:27.097
AI innovations and we can provide a lot of the base materials

44:27.097 --> 44:28.966
needed to provide that power.

44:28.966 --> 44:33.003
Many people say that the AI story for the next whatever amount of time

44:33.003 --> 44:34.705
is energy.

44:34.705 --> 44:36.974
I think there's a lot of truth in that.

44:36.974 --> 44:41.011
We're going to have to work our way through dealing with AI much like we've

44:41.011 --> 44:43.147
worked our way to trying to deal with social media.

44:43.147 --> 44:46.583
I don't think we're there yet but people talk about it and understand it a

44:46.583 --> 44:48.052
little bit better.

44:48.052 --> 44:51.789
As an intelligence side of things what is the threat of AI?

44:51.789 --> 44:53.424
What is the benefit?

44:53.424 --> 44:57.895
Well, the benefit of AI is it allows you to marshal vast,

44:57.895 --> 45:02.599
vast amount of information in a much more rapid way.

45:02.599 --> 45:06.837
The downside, just to give one example, is the ability that AI has

45:06.837 --> 45:11.075
provided to create absolutely picture-perfect,

45:11.075 --> 45:16.013
say, videos of world leaders, of corporate leaders.

45:16.013 --> 45:19.383
We were chatting earlier, and I'll just repeat my example, let's just imagine

45:19.383 --> 45:23.387
somebody with totally ill intent generates a

45:23.387 --> 45:27.458
video through AI that shows the Supreme Leader of

45:27.458 --> 45:32.930
Iran being assassinated and then that is shown in Iran as

45:32.930 --> 45:38.268
truth. Can you just imagine the reaction?

45:38.268 --> 45:42.272
Or the CEO of this company or any company with which the company deals,

45:42.272 --> 45:46.210
there's a video, an AI, that says

45:46.210 --> 45:49.079
X, Y and Z and there's a run on the stock.

45:49.079 --> 45:53.016
The number of things that could happen today because of AI in the

45:53.016 --> 45:55.119
negative sense I think are almost unlimited.

45:55.119 --> 45:59.423
A lot of it is derived I think from what we broadly call mis-dis

45:59.423 --> 46:03.227
information and I don't think we've quite come to grips with it yet and we have

46:03.227 --> 46:05.696
to try a little bit harder. I don't think the world's going to come to an end

46:05.696 --> 46:09.767
because of this but it's a new thing and all new things bring both

46:09.767 --> 46:13.537
positive, I think, and negative and we have to work our way through them.

46:13.537 --> 46:16.874
It's been fascinating to talk to you. I feel like we could go on for a very

46:16.874 --> 46:21.712
long time. How would you like to sort of wrap up as investors

46:21.712 --> 46:23.814
walk into this new world?

46:23.814 --> 46:28.385
There's obviously opportunity and opportunity to invest in Canada, do

46:28.385 --> 46:31.855
you think this is actually a pretty interesting moment to invest in this

46:31.855 --> 46:33.357
country?

46:33.357 --> 46:37.394
I do because I think we retain all of the advantages

46:37.394 --> 46:41.698
we've always had. We're stable, we have an independent judiciary,

46:41.698 --> 46:47.137
we have stable contract law, we have an educated population, we

46:47.137 --> 46:51.308
have all those things that we've always had, and I think we have them

46:51.308 --> 46:55.746
relatively speaking today more than we used to because they're more problematic

46:55.746 --> 46:58.415
in a whole raft of other countries.

46:58.415 --> 47:02.352
I used to do a little bit of trade when I was at NRCan and elsewhere

47:02.352 --> 47:06.290
and people tended to forget, it's all very well and fine to say, we are

47:06.290 --> 47:11.929
going to export forestry products to country X and

47:11.929 --> 47:15.265
that country doesn't have established contract law.

47:15.265 --> 47:19.570
The courts are corrupt, we're never paid.

47:19.570 --> 47:23.507
We forget about that. That's one of the challenges of dealing

47:23.507 --> 47:27.611
with Russia. Some things go there perfectly well but if it doesn't

47:27.611 --> 47:31.748
suit the government of the day a contract is not anywhere near as

47:31.748 --> 47:35.786
valid as it would be here. Both intrinsically because of the things we already

47:35.786 --> 47:39.756
have and because in relative terms we're in better

47:39.756 --> 47:42.960
shape. Just in closing I would say, I mean, we've talked about a number of

47:42.960 --> 47:45.095
negative things, and there are negative things.

47:45.095 --> 47:48.866
I think one of the things that we have to be is clear-eyed.

47:48.866 --> 47:52.169
We've gone through the Cold War, we've gone through COVID, we've gone through a

47:52.169 --> 47:55.339
whole raft of crises while I was alive.

47:55.339 --> 47:59.243
Not a young person like you but all these things and we've gotten through them

47:59.243 --> 48:03.380
in one piece. It doesn't mean we're not going to have a tough year

48:03.380 --> 48:06.049
or two but I think we also have to put it in perspective.

48:06.049 --> 48:10.120
The last point i want to make is,

48:10.120 --> 48:14.258
yes, the United States is causing a migraine right now but we still

48:14.258 --> 48:18.295
share a vast number of interest and values and we need to keep

48:18.328 --> 48:22.933
working at them while we try and fix those parts that are problematic.

48:22.933 --> 48:25.502
I'm asking one more question even though you just wrapped up, are we going to

48:25.502 --> 48:29.339
have some version of conscription in this country?

48:29.339 --> 48:33.543
I don't think so. I think the history of this country is very, very

48:33.543 --> 48:37.247
anti-conscription. We were almost through World War II before the government

48:37.247 --> 48:40.217
imposed conscription.

48:40.217 --> 48:43.921
That was a problem in particular with Quebec which wasn't very keen.

48:43.921 --> 48:47.557
I think the current generation would be less enthusiastic unless we were

48:47.557 --> 48:51.695
actually attacked. As a preemptive policy I would

48:51.695 --> 48:55.465
say no. I think it would be more likely that either a provincial government or

48:55.465 --> 48:58.902
the federal government might develop some form of national service.

48:58.902 --> 49:03.206
You help out with disaster

49:03.206 --> 49:07.344
relief or you help out in far north communities, a bit like

49:07.344 --> 49:12.616
a domestic peace corps if I can put it that way, but it's compulsory, you

49:12.616 --> 49:14.851
get paid something and you go where you're told.

49:14.851 --> 49:16.186
You have to do your service [crosstalk].

49:16.186 --> 49:20.524
You do your service but not in a military sense would be my guess.

49:20.524 --> 49:23.293
Fascinating. We really owe you a great debt.

49:23.293 --> 49:26.263
Thank you, Dick Fadden, for being here today on Fidelity Connects.

49:26.263 --> 49:27.898
We hope you will come back again soon.

49:27.898 --> 49:29.366
I'd be glad to. Pleasure.

49:29.366 --> 49:33.303
Thanks for watching or listening to the Fidelity Connects

49:33.303 --> 49:37.441
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50:06.970 --> 50:10.807
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50:10.807 --> 50:14.745
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