Income gap between Canadian households increases at record speed: Statistics Canada

Iva Poshnjari, BNN Bloomberg

The share of disposable income between Canada’s highest and lowest households widened in the first quarter of 2023, according to data released by Statistics Canada. 
 
The gap between the top 40 per cent and bottom 40 per cent of household incomes reached 44.7 per cent, marking a 0.2 per cent rise from the same time last year, the findings released on Tuesday showed. The figure was still lower than pre-pandemic levels, which averaged 45.1 per cent from 2010 to 2019, the data revealed. 
 
In terms of overall net worth, the gap between the rich and poor increased at record speed in the first quarter of this year with a 1.1 percentage point rise from the same period in 2022, the report said.
 
The highest 20 per cent of income earners increased their disposable income in Q1 of 2023 faster than they did last year, fuelled by investment earnings such as dividends and bank deposits, which nearly doubled to 22.7 per cent from 13.4 per cent for all households within the time period, according to the findings. 
 
In comparison, the lowest income earners also made financial gains but at a slower pace, the report showed. 
 
Average salary gains for the bottom 20 per cent of low-income earners grew 1.0 per cent in Q1, versus 4.0 per cent for all households while self-employment income decreased 6.7 per cent. The group gained from retirement benefits, and, 38.8 per cent within this category claimed government support as a main source of income, up from 34.2 per cent in 2022. 
 
Low-income households also suffered a reduction in average net investment income as increased interest rates for loans and mortgages accounted for 84.4 per cent of the reduction in net investment income, the data showed. 
 
Every household, expect the highest income earners, reported a drop in savings for the first few months of 2023 that fell below levels recorded three years ago — at the beginning of the pandemic. 
 
Almost all Canadian households who experienced a reduction in their net worth cited it was directly tied to real estate (92.1 per cent), the figures showed. The average real estate value held by households declined by 8.6 per cent in the first quarter of this year compared to the same quarter a year earlier, the data revealed. 
 
Younger age groups are at the highest financial risk due to debt-to-income ratios reaching record highs, the report warned. 
 
Debt-to-income ratios for young Canadians and core working age Canadians hit record highs in Q1 of 2023, the data showed. 
 
Despite income gains, high inflation and interest rates continue to weigh on these households, the report said.

 

Labour shortage in construction adding extra pressure to housing supply gap: experts

Rosa Saba, The Canadian Press

VIDEO CANADIAN CENTRE FOR POLICY ALTERNATIVES

The construction industry is short tens of thousands of workers, and experts say a coming wave of retirements could make the problem worse even as Canada is millions of homes behind what's needed to reach housing affordability this decade.

“That labour shortage is going to remain, and it’s only going to increase,” said Reva Bond, dean of the construction school at the Southern Alberta Institute of Technology.

The job vacancy rate in construction is at a record high with around 80,000 vacancies in the industry, said CIBC deputy chief economist Benjamin Tal in a recent note.

Those vacancies, which push up building costs and impede productivity, come at a time when the residential construction industry is under pressure to meet the demands of a growing population.

The Canada Mortgage and Housing Corporation forecasts a need for 3.5 million more homes by 2030 than the country is currently on track to build.

The number of new homes built, however, has been in decline, from just over 271,000 in 2021 to 260,000 in 2022. And in May this year, the annual pace of housing starts dropped 23 per cent month over month, leading the CMHC’s chief economist to predict that just 210,000 to 220,000 new homes will be built by the end of the year.

There are several factors that CMHC credits for this gap, and labour shortages are one, alongside higher interest rates, rising building costs and zoning problems.

It will be “incredibly challenging” to meet housing demand with a labour shortage in construction putting further strain on housing supply, said CMHC deputy chief economist Aled ab Iorweth.

But industry experts don’t see the labour gap closing any time soon.

“It’s been years in the making,” said Kevin Lee, CEO of the Canadian Home Builders Association.

For more than two decades, Lee said there’s been a shift away from directing younger generations into skilled trades, and toward what he calls the “knowledge economy.” That comes alongside a growing shift on the other end of the labour force, where around a fifth of the industry is set to retire in the coming decade, he said.

“But obviously ... the need to build homes has never gone away,” Lee said, adding that there’s also growing demand for workers on the renovation side of residential construction.

The labour shortage is significantly affecting productivity in the industry, as well as creating safety concerns, said Tal.

This was echoed by a recent industry survey by construction management software company Procore, where almost 30 per cent of respondents said they have been unable to take on more projects in the past three to six months due to labour shortages.

However, the labour shortage has also given workers in the industry more bargaining power amid the rising cost of living, and pay is reflecting that. A recent note from RBC said wages in the sector grew 9.4 per cent in 2022, nearly double other industries.

Despite efforts by schools like SAIT to speak to high school students, and an array of credit programs and scholarships, it’s still tough work to attract the younger generation to the sector, said Bond. The volatile nature of the work, which pays well hourly but can vary depending on demand, has also led some to leave the sector, she said.

Efforts to recruit more women and under-represented groups into the trades have made headway, but Bond said there’s been too much focus on recruitment and not enough on retention. Companies need a push to develop more inclusive practices, she said, to ensure that recruits from different backgrounds actually stay in the field.

Of course, the labour shortage is just one of the issues contributing to a housing supply gap, noted Lee — higher material costs, regulatory red tape and higher interest rates are all weighing on the building of new homes, he said.

Just as there are multiple factors contributing to the housing supply gap, there are multiple ways to address the labour shortage in construction, said ab Iorweth: “There’s no silver bullet.”

In the labour report, CMHC proposed a number of solutions, including converting existing commercial buildings into residential units, building more multi-unit housing, further incentivizing people to enter the construction field, and creating more targeted immigration programs to help bring in workers to the trades.

While more needs to be done to attract people to the sector, the construction industry should also seek to improve technology and innovation in order to help ease the gap, ab Iorweth said.

Lee said one innovation that has the potential to streamline construction is the adoption of modular construction, where some aspects of the construction process are done in a factory instead of on-site, with more opportunity for automation. He said the CHBA is working on an industry transition strategy that would look to government to help address some of the risk of adopting this technology, in particular the overhead costs, to encourage more widespread adoption.

Lee also said a higher percentage of immigration needs to be allotted to people in skilled trades. In May the federal government announced the launch of category-based selection for the Express Entry and included trades as one of the top priorities for work experience, which he said is a step in the right direction.

But while bringing in more immigrants with skilled trades experience is welcome, Bond said it’s important that the industry looks at how to retain those workers.

Much like with the younger generation of Canadians that the industry is trying to hire, she’s concerned there isn’t enough attention being paid on how to make construction jobs attractive over the longer term.

“Right now, we are not setting the next generation up for success,” she said.

 

Coca-Cola to spend $70M on upgrades to Calgary plant

Ben Cousins, BNN Bloomberg

In this Oct. 14, 2019 photo a truck with the Coca-Cola logo, behind left, maneuvers in a parking lot at a bottling plant in Needham, Mass. (AP Photo/Steven Senne, File)

Coca-Cola Canada Bottling Ltd. has committed to spending $70 million for upgrades to its bottling plant in Calgary.

The money marks the company’s biggest single investment in a facility since at least 2018, and will be used to “build a new, state-of-the-art, on-site, high-density warehouse,” according to a news release.

The upgraded plant will feature a new inventory management system and increased capacity, which the company believes will improve customer service and reduce emissions.

The non-alcoholic beverage sector has seen significant growth in recent years as people look to options other than alcohol.

Global Market Insights estimates the non-alcoholic beer market was worth more than US$22 billion worldwide last year and could be worth almost double that in the next 10 years.

Last week, the Conference Board of Canada reported the sector contributed more than $5 billion to the Canadian economy in 2019.

Brookfield Reinsurance signs deal for American Equity Investment Life Holding Co.

The Canadian Press

People walk to Brookfield Place off Bay Street on the day of the annual general meeting for Brookfield Asset Management shareholders in Toronto, May 7, 2014 , Reuters/Mark Blinch

Brookfield Reinsurance has signed a deal to buy the part of American Equity Investment Life Holding Co. (AEL) that it does not already own in a cash-and-stock transaction that values the company at about US$4.3 billion.

The deal will see AEL shareholders receive US$55 per share, including US$38.85 in cash and 0.49707 of a Brookfield Asset Management Ltd. class A limited voting share.

Brookfield Reinsurance will acquire the Brookfield Asset Management (BAM) shares required to pay the non-cash portion of the offer from Brookfield Corp. 

The transaction will reduce Brookfield Corp.'s stake in BAM to about 73 per cent from 75 per cent. 

Brookfield, which first proposed its offer last week, already holds about a 20 per cent stake in AEL. 

The deal is expected to close in the first half of 2024, subject to AEL shareholder approval and other closing conditions including regulatory approvals.

This report by The Canadian Press was first published July 5, 2023.

Mitigation efforts continue at Suncor in wake of cyberattack

The Canadian Press

Canada's top technical authority on cybersecurity says it is working closely with Suncor Energy Inc. in the aftermath of a high-profile systems breach at the energy giant.

The Canadian Centre for Cyber Security says it can't disclose details of the cybersecurity incident that caused payment systems at many of Suncor's Petro-Canada locations across the country to go down last week. 

Sami Khoury, head of the centre — which leads Canada's federal response to cybersecurity incidents — says mitigation efforts at Suncor are still ongoing, and sharing information too soon may compromise those efforts.

Suncor has not provided details about the type of cyberattack that occurred or whether any of its other operations were affected.

Some experts have said the Suncor systems breach will likely cost the company millions of dollars before it is resolved.

Khoury says the Canadian Centre for Cyber Security recently briefed high-level oil and gas executives about how to reduce the cybersecurity risk facing the industry.

This report by The Canadian Press was first published July 5, 2023.

 

Canada, U.S., Mexico gather in Cancun to talk North American trade irritants

James McCarten, The Canadian Press

North America's trading partners are in Cancun for two days of meetings to take stock of the last three years under the U.S.-Mexico-Canada Agreement. 

International Trade Minister Mary Ng is sitting down with U.S. Trade Representative Katherine Tai and Raquel Buenrostro, Mexico's economy secretary — the "three amigas," as Ng calls them. 

Tai's office says the U.S. exported nearly US$790 billion in goods and services under the trade deal in 2022, 31 per cent more than in 2012. 

The U.S. Department of Commerce estimates North American exports supported some 2.1 million jobs in 2021. 

All three sides will likely be thinking about the agreement's six-year review clause, which requires a comprehensive assessment of the deal by June 2026. 

But Ng says rather than hearing a ticking clock, she hopes both Mexico and the U.S. seize their chance to ensure the deal survives well into the future. 

The USMCA, known in Canada as CUSMA, is "the most successful in the world," Ng said Wednesday from Mexico City, where she was meeting with women-owned businesses to talk about its impact. 

"This agreement, as negotiated, provides both predictability and stability for 16 years, to 2036," she said. 

"These regular check-in points, including the one in 2026, are an opportunity to create even more certainty to extend the agreement beyond 2036."  

Canada and Mexico are also keen to hear more about whether the U.S. will abide by a tribunal ruling earlier this year that rejected how it classifies foreign automotive content. 

For Ng, that question has been "on the top of my desk" for months, and underscores one of the most vital aspects of an international trade agreement: that all parties abide by the terms. 

"The rules that underpin all of us through this agreement are rules that we all value, and that we all must respect," she said. 

"We are also all working to fight climate change — and the auto sector has a really important part to that, which is electric vehicles — and making sure that we are creating stability and certainty for the sector."

The dispute panel's decision, released in January on the heels of the North American Leaders' Summit, declared the U.S. interpretation of foreign content rules for autos "inconsistent" with the terms of the deal.

The USMCA increased the allowed "regional value content" for automotive parts to 75 per cent, up from 62 per cent, as part of an effort to give all three countries a bigger piece of each other's auto manufacturing sector.

In a core component such as an engine, the long-standing concept of "roll-up" allows such a part to be considered as having 100 per cent North American origins once the regional threshold of its various elements is met. 

It's an essential step to determine which vehicles are deemed duty-free. The U.S. had tried to argue for a more rigid interpretation of the agreement's language, but the panel rejected that argument outright.

Since then, the U.S. has been largely silent on how it intends to respond, and officials in Tai's office offered no clues during a telephone briefing Wednesday about whether the meetings would produce any clarity.

"We are engaging with Mexico and Canada on finding a positive solution," said one official, speaking on condition of anonymity under the terms of the call. 

"We want to find one that will benefit all the parties and stakeholders by enhancing North American motor vehicle production and jobs."

Officials also said two persistent U.S. points of contention — Mexico's production of genetically modified corn and Canada's rigidity on dairy export quotas — remain high on the priority list for all three parties. 

However, they are all subject to separate dispute resolution efforts, which remain the primary vehicle for resolving them, the official said. 

This report by The Canadian Press was first published July 6, 2023.

How will climate change affect Canada’s insurance market?

Holly McKenzie-Sutter, BNN Bloomberg

As wildfires prompted evacuations just outside of Halifax this spring, brokers at Royal LePage Atlantic encountered an unexpected challenge.

Many insurers were unable to issue new home insurance policies within a 50-kilometre radius of the evacuation zone – an area that covered most of the greater Halifax area during the year’s busiest real estate season.

“For lack of a better description, our markets were shut down for three weeks while we waited for that evacuation order to lift because nobody could get insurance,” Matthew Honsberger, broker, president and owner of Royal LePage Atlantic, told BNNBloomberg.ca in a telephone interview.

Insurance companies have been quick to address the backlog since the evacuation order lifted in early June, and Honsberger said he’s not overly worried about fire-related disruptions to his business – yet.

“If we start to see this become more regular, it's something that we will have to concern ourselves with,” he said.

It’s the first time Honsberger has dealt with a major wildfire-related insurance quandary in his 20 years in business in Atlantic Canada, but flooding and hurricane season are regular concerns in the region. Homebuyers and brokers in more wildfire-prone areas of Canada have butted up against temporary insurance challenges for years.

Climate change has rattled the global insurance market as fires and other natural disasters become increasingly frequent, intense and destructive, leading to bigger annual losses. Against that backdrop, governments and industry players in Canada are racing to find solutions to ensure home insurance does not become a luxury for the rich.

CALIFORNIANS LOSE INSURANCE OPTIONS

In one startling global example,  insurance giants State Farm and Allstate said in the past year that they the would stop issuing new home insurance policies across the entire U.S. state of California, citing increasing wildfire risk.

Could such a situation happen in Canada?

Marcos Alvarez, global head of insurance at DBRS Morningstar, said he doesn’t see that playing out any time soon, as most fires in Canada tend to be in less-populated areas that result in manageable losses to companies – though that could change if fires move closer to urban centres.

California is also known for its uniquely strong consumer protections that have kept premiums low and frustrated insurance companies as fires result in major damages.

What Alvarez sees as a more likely scenario in Canada is that insurance could become essentially unaffordable over time as more frequent severe weather events and higher inflation push premiums upwards.

Alvarez published a report for DBRS Morningstar last month on wildfires in Canada, predicting insurers will “come under pressure” from an “above-average wildfire season” in 2023 but most will be able to handle the losses. Damages will likely be lower than the record $4.3 billion from the 2016 wildfires that hit the Alberta oil town of Fort McMurray, the report said.

While this year’s fire damages will likely be manageable, the report warned there may be cumulative effects on insurance costs.

“As Canada experiences more intense and frequent extreme-weather events, the challenge is that certain zones of the country might become too expensive to insure against natural catastrophes, or become uninsurable altogether,” his report said.

Matt Hands, vice-president of insurance at Ratehub.ca, said Canada’s insurance industry is in the early stages of responding to climate change and weather impacts, but overall the situation isn’t as “dire” as in the U.S. because wildfires are still considered unpredictable in Canada, even as they occur more frequently.

“Canadians at this time don't need to be concerned that insurance companies are going to stop insuring fire,” he said. “But we are seeing the impact of the rising cost of claims, and the rising occurrence of climate-related claims.”

Insurance is becoming more expensive for all Canadians as a result of more extreme weather, inflation and other factors, Hands said, with people in more disaster-prone zones feeling the pinch most acutely.

He recommended that people shop around to assess all their options when looking for home insurance, and talk to a broker to ensure their bases are covered. He also advised people make sure replacement costs for their home are up-to-date in their insurance plans, as building materials have become more expensive over time and could mean a costly rebuild in the event of extreme weather damage.

EXISTING GAPS

Weather-related damages caused $3.1 billion in insured losses in Canada in 2022, the third-costliest year on record.

That total would be higher, said Rob de Pruis, Insurance Bureau of Canada’s national director of consumer and industry relations, if it included more damages from flooding – a major gap in the Canadian insurance market that the federal government is now trying to fill.

De Pruis explained that about 10 per cent of Canadians can’t purchase overland flood insurance because it is unavailable or too expensive in high-risk areas.

For example, many Atlantic Canadians whose homes were battered by post-tropical storm Fiona last year were not able to claim insurance for their losses, and some affected by 2021 floods in British Columbia similarly found themselves without coverage.

In its spring budget, the federal Liberal government moved to address that gap, earmarking $31.7 million over three years to develop a national flood insurance program – a move applauded by the Insurance Bureau of Canada.

In his June report, Alvarez suggested a “similar framework is needed” to address wildfire impacts in Canada. Hands said he could see the merit of a national fire insurance program as well, if wildfires become more frequent and predictable as they have in some parts of the U.S.

ADAPTATION

With some people currently unable to insure their homes against floods due to excessive cost, could Canada already be heading towards a situation where insurance isn’t accessible to everyone?

“We certainly hope not,” said de Pruis. “Ultimately, our goal in the industry is to be able to provide available and affordable insurance coverage for all Canadians. But having said that, we have to work together to improve our overall climate defences.”

He argued climate resilience planning should go into new infrastructure and land use planning, and also called for incentives to develop homes and businesses further way from high-risk areas. Canada is working towards some of these goals with its early-stages national climate adaptation strategy, announced last month.

“It requires collaboration from governments and stakeholders and even the individual property and business owners to create a more climate-resilient community,” de Pruis said.

With files from The Associated Press and The Canadian Press.

CANADA

Pulling ads from Facebook could force its hand on news deals — if support grows

Christopher Reynolds, The Canadian Press

Pulling ads from Facebook could prod Meta toward inking deals with news outlets, though more momentum would be needed to push it over the edge, experts say.

The tactic adopted by several governments and companies in Canada this week might force the social media giant's hand if other countries and corporations follow suit in larger markets, said Sam Andrey, managing director of the Dais at Toronto Metropolitan University.

"I thought it was interesting how quickly a bunch of organizations and governments followed, and I'm sure there will be more," he said.

"The government of Canada by itself as an advertiser is not a huge material loss for them in the scheme of their total Canadian advertising. But if it kicks off a movement then you could see them reconsidering."

The federal government — followed swiftly by the province of Quebec, the City of Montreal and media companies Quebecor Inc. and Cogeco Inc. — said Wednesday they would suspend advertising on Facebook and Instagram as tensions with tech titans rise over the Online News Act.

Bill C-18, passed in June but not set to take effect until late December, forces digital giants to pay media outlets for content they share or repurpose on their platforms.

In response, Meta and Google announced last month they would remove news by Canadian journalism outlets from their sites before the law comes into force.

Kent Walker, president of global affairs for Google and its parent company Alphabet, said in an interview last week the law is unworkable because it puts a price on links, resulting in an uncapped financial liability "that no business could accept."

"I think we need clear financial expectations, and we need a clear and realistic path toward exemption that takes into account our commercial agreements and the other support we provide for news in Canada," Walker said.

A spokesperson for Meta said the regulatory process won't be able to address the changes the company wants to see, which is why it plans to remove news from its platforms.

"Unfortunately, the regulatory process is not equipped to make changes to the fundamental features of the legislation that have always been problematic, and so we plan to comply by ending news availability in Canada in the coming weeks," they said on Wednesday.

The $10 million a year that Canada's heritage minister said it spends on advertising with Facebook and Instagram amounts to a tiny fraction of Meta's US$113 billion in ad revenue last year.

Nonetheless, media watchers say Meta may have to reconsider its strategy if larger companies as well as governments that are crafting similar legislation — including the United States, United Kingdom and Brazil — follow Canada's lead.

"Other democratic countries such as United States, Mexico, the EU could all take some similar principled steps," said Courtney Radsch, director of Center for Journalism and Liberty, a Washington, D.C.-based think tank.

The six-month period before the bill comes into effect gives Ottawa time to decide how to proceed with regulations. But a spokesperson for Meta said fine tuning won't be able to address the core changes the company wants to see.

"Unfortunately, the regulatory process is not equipped to make changes to the fundamental features of the legislation that have always been problematic, and so we plan to comply by ending news availability in Canada in the coming weeks,'' the spokesperson said in a statement Wednesday.

When Australia introduced a similar law in 2021, Meta temporarily blocked news from Facebook. In that country, Meta and Google entered into agreements with news publishers, as Bill C-18 also requires.

Now, Meta may be using Canada as a cautionary tale to other countries, Andrey suggested.

"They are worried about this spreading from Australia — and now to Canada — to much larger jurisdictions," he said.

"We just have the unfortunate position of being a test case for them. If they can make it hurt here, will others not want to follow? It's bullying tactics."

Meta has said pulling news links simply puts it in line with the law.

Beyond dollars and cents, reputations are also at stake.

“I think there’s real risk for Meta," Andrey continued.

"There’s already concern about the spread of disinformation and conspiracy theories. If you remove authoritative news sources, do you feed that perception that the information on these platforms isn’t credible?”

Whether social media users care is another matter. A handful of Canadian governments and telecoms yanking ads may not grab the attention of teens on Instagram. But if larger, hipper retail brands or celebrities chimed in, and especially if the user experience were altered, the tide could start to turn.

CBC News's editor-in-chief, Brodie Fenlon, released an article this week describing how he was unable to see posts on the brand's Instagram page, which had a note saying the content was blocked "in response to Canadian government legislation."

“Once those roll out, people will care about that, because it’s adding friction to their internet experience," Andrey said.

—With files from Tara Deschamps in Toronto and Mickey Djuric in Ottawa

This report by The Canadian Press was first published July 6, 2023.

 

Meta funds a limited number of fellowships that support emerging journalists at The Canadian Press.

'The world is watching' Canada's online news feud, heritage minister says

BNN Bloomberg

As Canada’s fight with Meta and Google escalates, Heritage Minister Pablo Rodriguez said other countries and organizations are keeping a keen eye to see how things play out.

Rodriguez told BNN Bloomberg Wednesday that he has meetings with representatives from the U.K., U.S., Indonesia and Brazil about the fallout from the Online News Act.  

“Meta’s attitude is unacceptable,” he said. “They’re trying to intimidate Canadians. By intimidating Canadians, they’re trying to intimidate Americans and citizens from other countries and also governments from other countries.”

On Wednesday, the federal government announced it was suspending all advertising from Facebook and Instagram, which was followed by the province of Quebec and City of Montreal making similar pledges.

Quebecor and Cogeco have also committed to pulling ads from the platforms.

Rodriguez said several other domestic governments and companies are considering joining the boycott.

“It’s up to them to make their decision, maybe they’ll be inspired by what we do, but at the same moment, we also know the world is watching,” he said. 

Rodriguez said he has a meeting with Google later this week, but Meta has refused to meet.

“There’s a path to move forward and we’re inviting Meta to come to the table and negotiate with us,” he said.

Quebec joins feds in suspending ads on Facebook, Instagram as Meta vows to block news

Nojoud Al Mallees and Tara Deschamps, The Canadian Press

The federal government is suspending advertising on Facebook and Instagram as tensions with tech giants rise, with the province of Quebec and the City of Montreal following suit within hours.

The three governments' decision came Wednesday after Meta promised to block Canadian news content on its Facebook and Instagram platforms in response to Canada's recently passed Online News Act.

The new law will require tech giants pay media outlets for content they share or otherwise repurpose on their platforms.

Heritage Minister Pablo Rodriguez blasted Meta for choosing not to negotiate with the federal government and instead blocking content for some users as part of a test.

"Facebook has decided to be unreasonable, irresponsible, and started blocking news. This is why today, we are announcing the government of Canada will be suspending advertising on Facebook and Instagram," Rodriguez said Wednesday. 

"If the government and politicians don't stand up against that kind of bullying or intimidation, who will?" 

Prime Minister Justin Trudeau echoed his cabinet minister's comments later in the day, calling Meta's decision to block news "bullying." 

According to the heritage minister, the federal government spends about $10 million a year to advertise on the platforms, which he said will be reinvested in other ad campaigns. 

The minister defended the controversial law fervently, speaking to the state of the news business in the country and the need to protect it. 

"All these media (outlets) ... that play a fundamental role on informing Canadians are gradually disappearing, leaving room for the extremes and also for disinformation. And I think that it's bad news for our democracy," he said. 

Following Rodriguez's announcement, Quebec Premier François Legault tweeted that the province is suspending advertising on Facebook and Instagram until Meta resumes talks about the implementation of the federal Online News Act. 

"No company is above the law," Legault tweeted in French.

Montreal Mayor Valérie Plante followed soon after, saying on Twitter that the city would stop advertising on Facebook in solidarity with media.

Google has also promised to start blocking Canadian news when the bill comes into force in six months, but Rodriguez said the government is in talks with the company and believes its concerns will be managed by the regulations that will come to implement the bill.

"Today, we're calling on both platforms to stay at the table, work through the regulatory process with us, contribute their fair share and keep news on their platform," Rodriguez said. 

The bill will come into force in just under six months, giving the federal government time to decide on how it will proceed with regulations.

But a spokesperson for Meta said the regulatory process won't be able to address the changes the company wants to see. 

"Unfortunately, the regulatory process is not equipped to make changes to the fundamental features of the legislation that have always been problematic, and so we plan to comply by ending news availability in Canada in the coming weeks," the spokesperson said in a statement. 

MPs from the Bloc Québécois and the NDP, which both backed the legislation, joined the Liberal minister at a press conference on Wednesday.

"The web giants need to respect Canadian law. They need to respect Canadian democracy. And that is the the profound message that we are sending today to Meta and Google," said NDP MP Peter Julian. 

Canada is not the only country going after tech giants to get them to pay news publishers a portion of their revenues. In the U.S., a bipartisan effort led by Democratic Sen. Amy Klobuchar and Republican Sen. John Kennedy is aiming to pass a similar bill. 

In a statement provided to The Canadian Press, Klobuchar panned the tech giants and called for resistance. 

"Of course monopolies will fight us every step of the way, but we won’t back down — we must stand up for small businesses and competition while ensuring people have access to their local news," Klobuchar said in the statement. 

Groups representing broadcasters and newspapers applauded the federal government for the move, while media companies have begun pulling advertising from some social-media platforms and telling readers and viewers how to access news directly.

News and telecommunications company Quebecor Inc. announced Wednesday it would immediately withdraw advertising from Meta's Facebook and Instagram platforms.

"Any move by Meta to circumvent Canadian law, block news for its users or discriminate against Canadian media content on its platforms, through its algorithms or otherwise, cannot be tolerated," Quebecor said in a press release.

Quebecor said it is pulling ads from Meta because of the company's "categorical refusal" to enter into negotiations around compensating media companies.

Quebecor owns telecommunications company Videotron as well as TVA Group, which includes the TVA television network, specialty channels and magazines. It also owns the Journal de Montreal and Journal de Quebec newspapers.

In addition to posting content on Meta's platforms, it has sometimes bought ads on Facebook and Instagram. 

Cogeco, which owns and operates 21 talk and music radio stations across Quebec, also announced on Wednesday it will be pulling ads off the platforms. 

"Cogeco also calls on all levels of government to follow suit and temporarily stop investing in advertising on Meta platforms," the company said in a statement. 

CBC News's editor-in-chief, Brodie Fenlon, released an article describing how he was unable to see posts on the brand's Instagram page, which now has a note saying the content is being blocked "in response to Canadian government legislation."

"Nonetheless, we know large numbers of Canadians rely on Google and Meta to discover our news coverage," Fenlon wrote. 

"If those sources suddenly cut off access to our news, as Meta did for some Instagram users this week, then we want to ensure Canadians know where to go to find our journalism elsewhere."

He then listed a variety of ways CBC content could be accessed independent of Meta and Google, including on the company's news and streaming apps, websites, televisions, radios, newsletters, YouTube and voice assistants like Amazon Alexa and Google Home.

"Wide access to independent fact-based journalism is a pillar of any healthy democracy and we aim to be anywhere people are looking for news," Fenlon wrote.

"If third-party platforms independently decide to get out of the news business, for whatever reason, rest assured we will help you find our journalism and make it as easily accessible to you as possible."

Two very different points of view on nuclear energy in the US

Story by Zachary B. Wolf • CNN


Two distinct and unrelated stories this week convinced me it was a good moment to look at nuclear power in the US.

The standoff between Russia and Ukraine over Europe’s largest nuclear power plant, which Russia controls and which both countries say is at risk of sabotage.

News that Japan will soon release radioactive water into the ocean, a reminder of the 2011 Fukushima disaster.

Those developments, which might give anyone pause about the future of nuclear power, are counteracted by other headlines.

The opening of a new nuclear plant in Georgia, for example, will bring carbon emission-free energy at exactly the time worldwide temperature records drive home the reality of climate change caused by the burning of fossil fuels.

The question of nuclear energy splits governments

Germany made the decision to decommission all of its nuclear plants after disasters like Chernobyl and Fukushima. The last nuclear reactor there was taken offline earlier this year, a decision some might have regretted after Germany’s access to Russian natural gas was threatened by the war in Ukraine.

Next door, France is the worldwide nuclear leader. Most of its electricity is generated by nuclear power.

Russia, while it has been ostracized from the world economy in almost every way since its invasion of Ukraine, remains a major player in nuclear power. It enriches and sells uranium through its state-controlled nuclear energy company, Rosatom, which builds and operates plants around the world, according to a March report from CNN’s Clare Sebastian that explains why the West has largely left Russia’s nuclear power industry alone.

But it is China that is moving the quickest toward nuclear power production, according to the International Atomic Energy Agency.

Nuclear power in the US

As of 2022, about 18% of US electricity is generated by nuclear power, according to the US Energy Information Administration. Most large US nuclear reactors are old – averaging 40 years or more.

In addition to the Georgia reactor coming online, a new reactor began operating in Tennessee in 2016. But otherwise, the US nuclear power portfolio is old, and much of it is in need of improvement.

For an idea of the money and corruption that can revolve around energy production, look at the sentencing last week of Ohio’s former House Speaker Larry Householder to 20 years in prison for his involvement in a bribery scheme meant to get the utility company FirstEnergy Corp. a billion-dollar taxpayer bailout for two nuclear plants.

Billions set aside to fix aging US nuclear reactors, keep them online

The bipartisan infrastructure law signed by President Joe Biden in 2021 included a $6 billion program to provide grants to nuclear reactor owners or operators and stave off closing them.

More than a dozen reactors have closed early in the US over the past decade, according to the Department of Energy. At least one reactor, the Diablo Canyon Power Plant in California, will be kept open after a more than $1 billion grant.

Nuclear power – and how aggressively the US and other countries should be pursuing it – is a topic that splits scientists as well.

Two very different points of view. First, be very careful

I talked to one nuclear expert who said the US should be slow and methodical about nuclear power and another who argued there are multiple, public misperceptions about nuclear power that should be corrected.

The more circumspect voice is Rodney Ewing, a Stanford University professor and expert on nuclear waste who was chairman of a federal review of nuclear waste procedures. I was put in touch with him by the Bulletin of the Atomic Scientists, which aims to “reduce man-made threats to our existence.”

Despite his decades spent focused on nuclear issues, he said something I found remarkable:

“I don’t have yet, although I’ve tried for years, a well-formed position for or against nuclear energy,” Ewing said.

“Too often in the enthusiasm for nuclear energy, a carbon-free source of energy – and in the present situation of the issue of climate change, really a very important existential crisis – it’s easy to say, well, we’ll solve the problems later.”

He said the issues with nuclear energy – from the potential for disaster to the issue of how to store nuclear waste – should be compared with the potential for renewable alternatives like solar and wind energy.

A much more supportive view of nuclear energy

The University of Illinois energy professor, David Ruzic – who has a lively YouTube channel, “Illinois EnergyProf,” with multiple videos meant to dispel concerns about nuclear energy – has a much more positive view of nuclear energy’s future.

Illinois, by the way, generates more nuclear power than any other state. Lawmakers there recently voted to lift a moratorium on new reactor construction that was in place until the federal government can develop a technology for disposing of nuclear waste. That new policy must still be signed by the state’s governor.

Ruzic argues nuclear waste takes up such little space it should simply be encased in yards of solid concrete and kept at the site of nuclear reactors. The concrete, he argued, can be repaired every 70 years or so as it degrades.

“Over the 60 years we’ve been doing this commercially, we have learned so much about how to do it extremely safely and very well,” Ruzic said, arguing that the new plant in Georgia would not be affected by an earthquake and tidal wave in the way that Fukushima was, because the new reactor in Georgia is cooled by air in case of an emergency.

He argued that even in Fukushima, it’s important to note that there were no deaths associated with the radiation due to the failure of the plant, although many thousands were evacuated.

Any concern you can find to raise about nuclear power, Ruzic has a ready answer. He said no one should worry about the radioactive water Japan plans to release into the ocean from Fukushima because there is a level of radioactivity in everything already.

“You are adding something trivial and inconsequential, which will be diluted even more,” Ruzic said.

Even the Russia-Ukraine standoff over the Zaporizhzhia plant does not concern Ruzic; the biggest threat he sees, assuming it is not targeted by bunker-busting bombs, is that the plant ceases making electricity – not that it could turn into another Chernobyl.

“It’s really unfortunate that it’s in the middle of a war zone. But it’s also really unfortunate that chemical plants or coal plants or other plants are in the middle of a war zone as well,” he argued.

The modular future of nuclear

Both professors brought up the push toward small, modular nuclear technology for which there are numerous companies speculating there will be a major market. That market could grow exponentially if the government decides to put a tax on carbon emissions to account for the harm they cause.

Ewing argued there is not a clear US national energy strategy, and that means numerous state and federal agencies and private companies are searching, often at odds with each other, for something new. The expense and difficulty of developing nuclear technology will be a roadblock. The new Georgia plant took more than a decade to build and came in over budget.

Ruzic said that after the initial capital expenditure, the relative low cost of fuel for nuclear plants makes them a good, long-term investment.

When I came back to Ewing about his comment that he has no clear preference for or against nuclear energy, he said the broad question overlooks too much.

“The nuclear landscape is, from a technical and social point of view, complicated enough that broad general positions really don’t serve us very well,” he said.