Canadians needed “Honesty” before “Fairness” in Budget 2024
After more than eight years in office — and a litany of well-meaning but failed innovation initiatives — Ottawa should stop pretending it knows best.
Today’s Toronto Star column (“Liberal’s inadequate AI funding a sign Canada is not rewarding innovation”) addresses the Liberal government’s Budget 2024 $2.4B promise to boost Canada’s Artificial Intelligence sector, which had been pre-announced by the Prime Minister ten days ago. Like you, I didn’t have an inkling about his government’s counterproductive proposal to increase capital gains taxes on the very Angel Investor that has to take the investment risk on the AI Start-up this government claims to support. BNN Bloomberg viewers got to see host Amber Kanwar, CIBC Capital Markets Vice-Chair Lisa Raitt and I process it all on live television at 4pm yesterday.
That the Liberals don’t appreciate how this additional disincentive will more than undercut one of their key Budget initiatives is inexplicable. Fortunately, my column is still relevant — I’ve posted the first half below; if you want to see how it ends, you have the choice of buying today’s hardcopy, signing up for the $65 (pre-tax rebate) annual digital subscription via the newspaper website, or accessing the piece via your Apple News App.
Artificial Intelligence (AI) has become so ubiquitous, Callaway Golf claims to have used an “AI Supercomputer” to design its new driver. Not to be outdone, LG purports to have introduced AI into your laundry room in an effort to determine the “optimal wash pattern.”
If artificial intelligence is already helping me look my best as I bomb it off the first tee, it’s no wonder the Liberal Budget showcased an increased focus on AI.
In recent months, Microsoft has announced $8 billion of investments for AI data centres in the UK and Japan. Canada was sadly passed over, despite being a recognized centre for AI talent. When Ottawa first teased the new $2.4 billion AI program in Montreal ten days ago, Prime Minister Justin Trudeau committed that these funds would “maintain our position as a world leader in technology sectors.” If only that were true.
While $2.4 billion sounds like a serious commitment to “infrastructure for AI researchers and companies,” most of that spending is likely to go to foreign firms that have the computing power that Canada lacks. Today’s reminder that we’re still better at research than commercialization.
The devil is in the details, and the damning reality is that the trumpeted $2.4 billion will be spent over a reported five-year period. To put that $480 million annual AI commitment into a North American context, this key plank in Trudeau’s budget amounts to less than what venture capital funds invested last year into start-ups based in Alabama or Missouri, for example.
How can Canada be a “world leader in tech” if we’re being outhustled by Alabama, a state known more for its football prowess than R&D?
Hit the link to read the rest.
MRM
(note: this post is an Opinion Piece)