The News Rundown

Lockheed Martin promises $16.9B injection to Canadian economy with F-35s

Lockheed Martin Canada is offering the F-35 as a potential replacement for the military's nearly 40-year-old fleet of CF-18 jet fighters, and promises it can inject as much as $16.9 billion into the Canadian economy.
The company conducted an analysis on the impact of its program in Canada and estimates over the lifetime of the F-35, it will pour $16.9 billion into the gross domestic product and that there is the potential for more as sustainment contracts for the warplane eventually come on stream.
Lorraine Ben, the chief executive officer of Lockheed Martin Canada, said the fighter jet program is important to the country's economic recovery from the pandemic because it delivers high-skilled, high-paying jobs.
Steve Callaghan, Lockheed Martin's vice-president of F-35 business development, said he is confident the company has delivered a solid pitch to the Canadian government despite the difference and the possible handicap it faces: "We're delighted to be part of this competition. We understand the rules. We understand the way the competition is structured and the requirements."
Should Canada not choose the F-35, Callaghan said, the existing contracts, which are currently worth $2 billion, would be honoured for the duration of their commitment but might go elsewhere: "Future contracting would likely be placed using industries and best value for those nations that are procuring the F-35. Canadian industry is truly embedded in the global supply chain today and brings great value to the program and of course great value to Canada and Canadian industry. We really do look forward to Canadian industry continuing their contribution."
The previous Harper Conservative government intended to sole source the contract to replace the CF-18s with 65 F-35s with Lockheed Martin, but after scrutiny from the auditor general and the PBO, the plan was shelved.
Prior to their election in 2015, the Liberals promised not to buy the F-35 and instead purchase a cheaper aircraft and put the savings into the navy, instead holding a now 5 year long "competition" between different companies to try to find a cheaper replacement. It was instantly obvious that the Liberal proposal was inherently contradictory: you can’t hold a fair competition while excluding a clear front-runner. Eventually after pressure from allies Lockheed were allowed to enter the competition as well.
Three bids in the often-delayed $19 billion competition were delivered Friday and the federal government expects to narrow the field to two by next spring, with the first fighters not scheduled for delivery until 2025. The other contenders are Boeing's latest version of its Super Hornet, and Saab's updated Gripen.
In 2017 the Liberal's competition hit a snag when their favoured plane, the Boeing Super Hornet, got a deal pulled in retaliation of US trade policy. In 2017 Boeing complained to the U.S. Commerce Department that Canadian subsidies for Bombardier allowed it to sell its C-series civilian passenger aircraft in the U.S. at cut-rate prices. As a result, the administration of U.S. President Donald Trump enacted a tariff of almost 300 per cent against the Bombardier aircraft sold in the U.S. In retaliation, Canada cancelled the deal to buy the 18 Super Hornets from Boeing, which would have cost more than US $5 billion. Canada standing up for Bombardier and causing a tariff war with the US made it untenable for Canada to upgrade their airforce to modern standards, and their plan to spite the Conservative plan of going with the logical choice of Lockheed's F-35s and instead going with Boeing's Super Hornets was now in flames.
In the meantime, while the competition was often delayed, and the deal with Boeing off the table, the Liberals bought 18 used Australian F-18s, costing taxpayers over $1.15 billion, 22% more than the DND claimed it would when the deal was signed. There were difficulties and extra costs involved in upgrading the used jets so that Canada could integrate them into our airforce. At the same time, Australia bought new F-35s to replace the used jets they sold us.
Instead, we're using repurposed old technology, and costs for that are rising as well. On top of that, Canada is forced into paying for development of the F35s, even though we aren't even getting any! Canada is one of nine partner countries in the F-35 project, each of which is required to cover a portion of the stealth fighter's multibillion-dollar development costs to stay at the table. Each country pays based on the number of F-35s it's expecting to buy. Canada has pitched in more than half-a-billion dollars over the last 20 years, including $54 million in 2018.
The core problem is easy enough to grasp: Canada’s fleet of CF-18 jets is approaching 40 years of age, double its intended service life. The basic design is a few years older than that. The jets have been well maintained and periodically upgraded, and remain effective weapons. But there is only so much life that can be squeezed from such a high-performance machine before it simply becomes dangerous to expect any more from them. There is a real risk that they could actually start falling apart, even in mid-air, if pushed much longer and harder than they have been already. The only solution is new jets, and those jets will cost a lot of money, something no Canadian politician has much appetite for. But there is no way around this. And considering the long delivery time for such aircraft, the clock is very much ticking.

Alberta’s back to school plan for September has been announced for a while but there’s always been the question of what happens if a kid gets the virus?
This week Education Minister Adriana LaGrange and Chief Medical Officer of Health Dr. Deena Hinshaw announced a mask requirement for students in grades 4 to 12 and all educational staff and teachers.
This was a recommendation made by Dr. Hinshaw based on medical evidence.
The NDP and Alberta Teachers’ Association but said there was a lack of consultation with educators.
The NDP also called for reduced class sizes while the ATA said that these new guidelines do not respect “distancing in Alberta’s overcrowded classrooms”.
Time and time again the NDP and their union allies are using this pandemic to push their agenda.
Sun News columnist Rick Bell asked a question on Tuesday to Dr. Hinshaw about whether or not she was being told what to say by the Alberta government.
Her response was: “I have children in school. I have nieces and nephews in school. I have friends and family members who teach or work in schools. I have many people who I personally love and care about who will be in schools in the fall. I have provided my best advice and recommendations. The recommendations I have made based on best evidence have been accepted and supported.”
When the pandemic began the doctor was the hero and her word was taken as gospel. Our chief medical officers are seen by many as those who have guided our provinces successfully through the pandemic up to this point.
There has been a consistent stream of information released by public health officials only later to be invalidated by new research.
First we heard masks wouldn’t be helpful and now people are encouraged to wear them.
It can be chalked up to medical research or perhaps we also need to realize that public health officials didn’t want to create a run on masks to starve hospitals and doctors from their necessary equipment.
The point is that in any scientific field when new evidence comes forward there needs to be the ability to adapt.
What this doesn’t mean is attacking a public health official who has repeatedly been on the mark closer than her federal counterpart has.
When examining the world through a filter of new information we see common talking points rise through, these of course being the focus on smaller class sizes, hiring more staff, and putting more money into education. These are three pillars of NDP orthodoxy that were true yesterday, are true today, and will be true tomorrow.
The reasoning has just changed and the pandemic is the new reason today.
While Dr. Hinshaw’s advice was good enough for the NDP throughout the pandemic and they encouraged the UCP to listen to the science, it’s clear that the UCP has done just that.
Now when they disagree because it comes down to NDP orthodoxy, some say that Dr. Hinshaw is being told what to say but that’s clearly not the case.

CSIS warns about China’s efforts to recruit Canadian scientists

It's a new month and we're constantly finding new ways that China is trying to infiltrate Canada and subvert our democracy. The Canadian Security Intelligence Service has warned the country’s universities and research institutions that Beijing is using academic recruitment programs such as its Thousand Talents Plan, known as TTP, to attract scientists to China in hopes of obtaining cutting-edge science and technology for economic and military advantage.
CSIS says the TTP, which Beijing created in 2008 to identify and recruit leading scientific experts around the globe, is an example of the way China is attempting to get academics to share – either willingly or by coercion – the results of work conducted and financed in Canada so that China doesn’t have to rely only on traditional intelligence-gathering.
John Townsend, the head of CSIS’s media relations, said in a statement that some countries looking to acquire sensitive Canadian technologies and expertise use this non-traditional method of intelligence-collection: recruiting academics who will provide what a hostile state wants, or could be compelled to do so through offers of reward or threat of punishment: “Academic talent plans are one way to incentivize academics to participate in such activities. While the Thousand Talents Plan is one example, academic talent plans are used by multiple hostile states by other names.”
CSIS has increasingly noticed national security concerns with TTP, which has also drawn the attention of US Congress and law enforcement. China stopped publishing the names of people who have participated in the program in September, 2018, after the U.S. Justice Department began investigating allegations that some scientists illicitly provided China with technology and high-level research funded by U.S. federal agencies. Townsend notes that CSIS has spoken to universities and other research institutions about its concerns over this and other foreign recruitment programs after evidence of technology transfer emerged in recent years.
At least 15 Canadian academics have participated in the Chinese program, including experts in quantum computing, advanced electronics and engineering, vaccines, chemistry and artificial intelligence. The scholars have defended the program as mutually beneficial for Canada and China, and said they did not encounter any untoward conduct during their involvement.
In November, 2019, a U.S. Senate report, Threats to the U.S. Research Enterprise: China’s Talent Recruitment Plans, described the Chinese programs as a campaign to recruit talent and foreign experts to benefit China’s economic and military development. The Senate report says participants in the Thousand Talents Plan are asked to sign contracts that require them not to disclose that Chinese institutions will retain the rights to at least some of the intellectual property created by the U.S. researchers: “The contracts can incentivize members to lie [about their participation in TTP] on grant applications to U.S. grant-making agencies, set up ‘shadow labs’ in China working on research identical to their U.S. research, and, in some cases, transfer U.S. scientists’ hard-earned intellectual capital.”
A number of U.S. and Chinese nationals have been accused of lying about their roles in TTP. In January of this year, Harvard University chemistry professor Charles Lieber was charged for allegedly concealing his ties with the TTP and trading knowledge for money. Prosecutors say he set up a lab in China in exchange for hundreds of thousands of dollars from the Chinese government and didn’t disclose the funding to U.S. authorities.
In June, media in the United States reported that the U.S. National Institutes of Health had investigated the conduct of 189 scientists, and 54 either resigned or were fired for failing to disclose financial ties to a foreign talent program.
Jay Bratt, chief of the U.S. Justice Department’s Counter-intelligence and Export Control Section, told The Globe the Chinese talent plans are not illegal, but researchers can cross the line when they share U.S.-funded research or steal technology: “What is important to realize about the talent plans is they can incentivize those who are recipients of the funds and who are awarded under the talent plans … to engage in illegal conduct or malign activities,” he said. “This is a very large priority of the FBI. The FBI probably does even more outreach than we do with academia and private industry on the threat of what it calls non-traditional collectors.”
Barry Sanders, a theoretical physicist at the University of Calgary, became a Thousand Talents chair in 2013 with the University of Science and Technology of China. He continues scholarly work there even though it’s no longer funded through the program. He said he has never encountered anything that matches the criticism of the program. “I have never seen anything like that in my experience.” He said the Thousand Talents is of great benefit to foreign academics because, among other reasons, it gives them the means to do more research, which in turn helps Canada. “If anybody concerned about Canadian security wants to know what I am doing, I tell them. In China, they know this. China knows that whatever I do, I will make sure Canadian authorities know what I am doing – make sure Canada feels safe. I am loyal to my country; I will do what I can for mutual academic benefit. I will be careful with any lines that I am instructed to be careful about.”
University of Victoria chemistry professor Ian Manners, who also holds a Canada 150 Research Chair, said his experience as a Thousand Talents distinguished visiting professor at Shanghai Jiao Tong University (2018-2021) has been nothing but positive. He said the TTP is a prestigious fellowship and it allows him to bring students to China to study. Any intellectual property from the research will be shared between the two universities, he said: “The U.S. has lots of concerns about security and stealing the secrets, and I don’t know the evidence for that, but obviously there is pretty fierce economic competition between China and the U.S. I have never seen any evidence, certainly with my Thousand Talents award, of anything untoward at all. It is basically very fundamental research.”
All in all, it's very worrying that China is able to sway our leading thinkers, scientists and academics so easily, especially in the midst of a foreign relations crisis. The other side of the coin also revealed itself this week when a Chinese court sentenced Canadian Xu Weihong to death on Thursday for making drugs, the third such case in China since Canada detained Meng Wanzhou in 2018. A Chinese national, Wen Guanxiong, was also charged with making drugs in the same case and jailed for life, the court said in its notice.
The Canadian foreign ministry said in a statement that it was “profoundly concerned” by the sentence and called on China to grant clemency to Xu. The Guangzhou court did not say what drugs Xu had been convicted of making, nor give any other details about his crime. The court ordered his property to be confiscated, and it's unknown if Xu has a lawyer.
With this in mind, with the murky nature of the Chinese courts and lack of transparency, all Canadians including academics should be worried about travel to China, and it's clear that many Canadian academics have been paid off by China to keep their activities hush hush, given that so many are found to have lied about their activities, and yet no one is speaking out against China. It's a problem that both the media and the government needs to take more attention to.
Supplementals:

https://www.reuters.com/article/us-china-canada-crime/chinese-court-sentences-canadian-national-to-death-for-making-drugs-idUSKCN2520V1

Firing Line

US slaps 10% levy on some Canadian aluminium

The US has announced a new 10% tariff on Canadian aluminum.
Canada and the US along with Mexico have of course recently ratified the new USMCA trade agreement.
The allegation by the United States is that Canadian exports of raw aluminum into the United States have hit their highest level in history.
The US says that the surge of aluminum has intensified in the recent months despite a drop in demand from US manufacturers.
Cutting through the media spin and counter narratives is a hard job when it comes to this story.
The Canadian government dislikes Donald Trump, the Canadian media dislikes Donald Trump, and there are very few media outlets in the US that would report the full story when it comes to aluminum.
Quite honestly, there is no way of knowing who is right or wrong since the media on both sides of the border are horribly blinded.
Next year we can check the Statistics Canada international trade database and see who was right but as of now there is no full year on year data that has been made easily available.
Looking at the data that is currently available from Statistics Canada it looks as though through comparing the data we have from the first two quarters of 2020, Canada on average, has exported 34% more in 2020 than 2019. This means that if we exported 100,000 tons this year we would have exported 134,000 tons compared to the previous year.
With this, these numbers are even higher than those estimated by the United States of 18%.
These new tariffs will come into effect on August 16th.
If these numbers as presented by Statistics Canada are accurate, Canada has some explaining to do.
As part of the initial agreement in 2018 to remove the steel and aluminum tariffs, both countries agreed not to flood the others market with low priced materials.
With these tariffs Canada has decided to retaliate with dollar for dollar tariffs starting September 16th. The list of products or resources has not been made available as of yet.
Responding to these tariffs Deputy Prime Minister Chrystia Freeland called them absurd and ludicrous.
Ontario Premier Doug Ford was also very upset as this harms the manufacturing industry in his province.
We need to realize here that at the end of the day Donald Trump is playing to his base in Ohio, Michigan, Pennsylvania, and Wisconsin.
Canada has been in a position time and time again where had we put the core principles of economics on the forefront instead of trying to be the hero that stands up to the perceived schoolyard bully we would be in a lot better position economically with the United States.
Recall it was Mexico that first reached an agreement with the United States on the reformed NAFTA trade deal.
While yes tariffs are bad, our government has continuously squandered the opportunity to push forward and strengthen a manufacturing base in North America with this US President.
Our government and media should do the digging that’s required and tell the full story on what’s going on here and get to the bottom of who is not being honest in this trade dispute without automatically turning to blame the United States.
Supplementals:

Word of the Week

Reciprocity - the practice of exchanging things with others for mutual benefit, especially privileges granted by one country or organization to another.

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Show Data

Episode Title: Both Sides of the Coin

Teaser: Lockheed promises $17b into Canada’s GDP if the F-35 is finally chosen, the Alberta NDP claims Dr. Hinshaw is being muzzled by the UCP, and China could be stealing our academics’ research. Also, new US aluminum tariffs show the media’s true priorities.

Recorded Date: August 7, 2020

Release Date: August 9, 2020

Duration: 51:59

Edit Notes: Internet cutouts

Podcast Summary Notes

Duration: XX:XX