Evidence of meeting #18 for Industry, Science and Technology in the 43rd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was need.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Jim Balsillie  Chair, Council of Canadian Innovators
David Paterson  Vice-President, Corporate and Environmental Affairs, General Motors of Canada Limited
Donald J. Walker  Chief Executive Officer, Magna International Inc.
Christian Buhagiar  President and Chief Executive Officer, Supply Chain Canada
David Montpetit  President and Chief Executive Officer, Western Canadian Shippers' Coalition

3:20 p.m.

NDP

Brian Masse NDP Windsor West, ON

Thank you.

I know, Madam Chair, my time is up. Thank you.

3:20 p.m.

Liberal

The Chair Liberal Sherry Romanado

Thank you very much.

Our next round, the third round, will start with MP Van Popta.

You have five minutes.

3:20 p.m.

Conservative

Tako Van Popta Conservative Langley—Aldergrove, BC

Thank you, Madam Chair.

My first question will be for Mr. Balsillie. Thank you for being here.

You made the point, Mr. Balsillie, that Canada's productivity measures have been lagging for the last 25 years compared with some of our trading partners, but you said, and I hope I'm quoting you correctly, “Crises always clarify priorities.”

I like that optimism, but given this historic lag of productivity, is it realistic to think that Canada, in a post-COVID relaunch of its economy, can actually be competitive in the innovative space?

3:20 p.m.

Chair, Council of Canadian Innovators

Jim Balsillie

We can, 100%. We just have outdated policy thinking.

The whole world, 25 years ago, approached productivity as a two-legged race. There was neo-liberalism for the tangible economy, where you got rid of friction and had free trade, and then for the intangible economy, based on restriction, they built a set of digital policy infrastructures. Canada thought it was a one-legged race and the rest of the world ran it as a two-legged race. All I'm suggesting is perhaps we invoke the second leg.

That's what I mean by updated thinking. We have lots of experts, but they're not used because the keepers of the policy orthodoxy don't think it matters. What's the old expression? “I've seen the enemy, and the enemy is us.”

3:20 p.m.

Conservative

Tako Van Popta Conservative Langley—Aldergrove, BC

Thank you. That's a good answer.

Still about productivity lag in Canada, do you see a correlation between Canada's lagging productivity growth on the one hand, and on the other hand our inability to grow homegrown technology companies from start-up to scale-up? That comes from your website, the distinction between start-up and scale-up.

3:20 p.m.

Chair, Council of Canadian Innovators

Jim Balsillie

I do, 100%, yes. The ideas economy is based on the principle of restriction. It's an abstract construct. Ownership is based on what are called marketplace frameworks. You can only be successful in the ideas economy and to scale in a way that moves the dial if you have a full and complete digital policy infrastructure that's created in what you call a public-private framework.

The whole world went hands-on 20 years ago when we went hands-off. We will only scale up and we will only reverse this productivity once we understand how the game is played and get rid of these corrosive neo-liberal approaches for the purposes of the ideas economy.

3:20 p.m.

Conservative

Tako Van Popta Conservative Langley—Aldergrove, BC

Thank you for that.

You also made the point.... I find it intriguing, the concept of an IP collective. You draw the parallel to the history of western Canada in particular and the development of it.

Has the concept of an IP collective proven successful in any other situation, in any other country?

3:25 p.m.

Chair, Council of Canadian Innovators

Jim Balsillie

Many countries use IP collectives. In fact, all of these state industries were, at their origins, IP collectives through their telcos and their various industrial Crown corporations around the world. Korea has it. Singapore, France, Japan—they have multiples of them.

Also, we should employ a data trust, which is just another form of collective for data. These are organized tool kits as a result of creating institutions that create an environment in which you can prosper. These are hands-on technical realms.

We have to take charge of our own future, our own destiny, and build our country. Nobody's going to build it for us. We built this country 100 years ago with courage and deliberateness. For some reason, we caught this narrative that it was hands-off 25 years ago, and the whole world was double hands-on.

I did business around the world. Every country is hands-on in its ideas economy. We were the only one I ever encountered that were hands-off on all these things. That's why I'm trying to explain this to you. We don't have to do anything novel; just do what all the other successful economies are doing.

3:25 p.m.

Conservative

Tako Van Popta Conservative Langley—Aldergrove, BC

Would an IP collective require any legislative measures, like amendments to the Patent Act or the Trademarks Act, etc.?

3:25 p.m.

Chair, Council of Canadian Innovators

Jim Balsillie

No, and it's allowed through USMCA, as are data trusts, and it was approved in the budget two years ago. We just have to choose to implement it. It hasn't been implemented yet, because I don't think that people think it's important. We don't think that owning our ideas is important. We think it will just go out to the world and somehow it will work out. It's hands-off. We don't even tie our funding to it. Tens of billions of dollars we've funded, and we don't make sure that it stays for the benefit of our economy, security and prosperity,

I've seen no country in the world do it like we do. It's unfathomable to anyone who's skilled in the arts.

3:25 p.m.

Conservative

Tako Van Popta Conservative Langley—Aldergrove, BC

I have one quick question. How does our Canadian Intellectual Property Office, CIPO, compare to regimes in other countries in its effectiveness and its ability to be responsive to industry?

3:25 p.m.

Chair, Council of Canadian Innovators

Jim Balsillie

It's fine, and they are doing a good job on education, but we just have to understand that what they do is strategic, and we have to do a lot more of that.

It is the upstream funders that matter, not the implementers of the owned ideas. CIPO just processes what comes to them.

3:25 p.m.

Liberal

The Chair Liberal Sherry Romanado

Thank you very much.

Our next round of questions goes to MP Jowhari.

You have five minutes.

3:25 p.m.

Liberal

Majid Jowhari Liberal Richmond Hill, ON

Thank you, Madam Chair.

Thank you to all the witnesses. This has been quite an informative session.

Let me start by going back to a number of different topics that came up that resonated with me. To move on, we have to get the economy up and running. Then we have to keep it up and continuing to run.

I also heard a lot about resiliency and about a two-legged race, that we excelled in one and we forgot about the second, and we are hearing we did that some 25 years ago.

We also heard from Mr. Balsillie that he had hoped our committee or the government would have a list of sectors that would be prioritized in ramping up the economy and building resiliency on that.

Traditionally you could take a GDP-by-sector approach and say these are the sectors where we would ramp up and build in resiliency by putting in safety, tracking, testing and all of those things, and ramp it up and make sure that you bring confidence to the consumer to increase general demand again, but what I'm hearing from you, Mr. Balsillie—and I'll start the questioning with you first—is that we need to bring in the IP collective and we need to bring in the second leg.

If my understanding was correct, in the absence of not having a strategy, can you help us depict a strategy forward on which sector the economy will focus, in what area would we launch and how we build resiliency in that?

3:25 p.m.

Chair, Council of Canadian Innovators

Jim Balsillie

What we pick is a bit of a normative exercise, so you tell me what's important and I'll tell you how to do it right.

If we think being sovereign in our medical industries is important, then we should be doing a whole bunch of things very differently. If we think our energy sector matters to us and our agricultural sector matters to us, then we should be doing whole bunch of things in an investment act, in data trusts, in patent collectives and vertical forms of investment.

You decide what is important to be a sovereign nation. What mattered 100 years ago is different now, and certainly a pandemic heightens other forms of priorities, so you have to say what is important and then you have to design the tool kit to make sure you protect the importance of those things. There was a time 100 years ago—

3:30 p.m.

Liberal

Majid Jowhari Liberal Richmond Hill, ON

Yes, I understand, so in your opinion—

3:30 p.m.

Chair, Council of Canadian Innovators

Jim Balsillie

In my opinion? Oh, my goodness, I think—

3:30 p.m.

Liberal

Majid Jowhari Liberal Richmond Hill, ON

Yes, what sector should we lead with to support our nationality in the new norm after COVID-19?

3:30 p.m.

Chair, Council of Canadian Innovators

Jim Balsillie

What others call the family business—our traditional resource industries like energy, mining, agriculture, fisheries, forestry—should have an IP and data strategy with them so that they don't get done to them what Uber did to taxi drivers and what John Deere and Bayer can do to our farmers. We have to protect ourselves in what are called value chains.

The car drivers had control of the supply chain of the car, but they lost control of the value of their business and the price of their job, and it all went to those who controlled the IP and data, and that's what I'm talking about in collective forms of value chains that we need to have strategies for.

I would apply them, most importantly, to our traditional businesses and include medical in that. I would certainly include manufacturing and automotive in that, by all means.

3:30 p.m.

Liberal

Majid Jowhari Liberal Richmond Hill, ON

What you are saying is to do a traditional and parallel approach. Certain sectors or central industries still remain core, but then we should go back and re-evaluate based on the new norm of what we think we should add as a priority and start building resiliency and launch these reopening initiatives one by one.

3:30 p.m.

Chair, Council of Canadian Innovators

Jim Balsillie

Yes, you should have offensive and defensive forms of protecting the value in those core Canadian traditional businesses, because the world has shown it has become much more mercantilist and rivalrous. Everyone is a lot more by themselves than they realize, so you have to create more sovereign approaches, and what you will find out is that if we don't control the value chain, then we're just competing on cost to the bottom, if even that.

3:30 p.m.

Liberal

Majid Jowhari Liberal Richmond Hill, ON

Thank you.

I have 15 seconds, which I will yield to the chair.

3:30 p.m.

Liberal

The Chair Liberal Sherry Romanado

Thank you very much.

Our next round of questions goes to MP Dreeshen. You have five minutes.

3:30 p.m.

Conservative

Earl Dreeshen Conservative Red Deer—Mountain View, AB

Thank you very much, Madam Chair.

I want to thank all of the witnesses for coming today. Your presentations have certainly given us a lot to think about.

I think the big question is, what will this government learn from the pandemic? Will it continue to use it as a tool to hypnotize the masses, or will it abandon its global initiatives and focus on Canadians?

Those of us with secure jobs or fixed retirement incomes, minus the stress of investment depletion, will weather this storm for now, but printing billions of dollars a week to cover the Prime Minister's daily cuckoo clock appearances will hurt us for generations to come, and those people working for businesses teetering on the brink will need to make wage concessions that the public sector would be appalled by, so we need a plan. We can't make the same mistakes again.

Health and social distancing decisions made for high-density communities are necessarily different from those for communities that are more sparsely populated. Supplying funds to help small business owners adapt to this new reality would have been much better received than having them watch their clients all flock to big-box stores for their purchases. The most common theme we've heard throughout this nightmare has been the concern over both the lack of any federal government plan to reopen Canada's economy and the lack of any plan to build and support Canada's future economy. Let's call that a 10-year plan for the economy of the future.

This Liberal government is devoting huge resources to so-called “green economy businesses”. We've just heard from Mr. Balsillie how we really should be thinking about and concentrating on our core values. Regardless of the damage that it does to these other economic sectors, they fail to recognize—

3:30 p.m.

Liberal

Lloyd Longfield Liberal Guelph, ON

Madam Chair, I have a point of order.