00:09:50.880For the record, please state your full name and spell it out.
00:09:53.300My name is Christa Freeland, C-H-R-Y-S-T-I-A, Freeland, F-R-E-E-L-A-N-D.
00:10:04.940Do you swear that the evidence to be given by you to this commission shall be the truth, the whole truth, and nothing but the truth, so help you God?
00:13:12.380Well, that leads fairly nicely into my next question, actually, because that dual role you had as Minister of Finance and as Deputy Prime Minister puts you in a unique position to tell us a little bit about the context in which the events that are before the commission, the Freedom Convoy and the protests occurred.
00:13:33.620So we spoke about this a bit in your interview, and I'm hoping you can put, situate in context from your unique perspective what was going on.
00:13:47.420And I'll mostly focus on the economic and financial perspective because that was largely my focus.
00:13:57.780so all of this started to happen at the end of January and it's worth bearing in mind as I said
00:14:10.460we were preparing the budget at that point we were sort of deep deep in budget preparation mode
00:14:16.080and that means that the Department of Finance I personally Michael Sabia we were all really
00:14:23.680focused on where is the Canadian economy right now and what is our path forward. And I think
00:14:31.640it's worth reminding people that it was a really challenging time for the Canadian economy.
00:14:39.260COVID was still very much with us in January. In Ontario, there had been lockdowns, there was
00:14:47.220virtual school. So we still had COVID with us. We could see beyond it. And we could see that the
00:14:55.360time was coming to go from a COVID lockdown, really emergency government support for the
00:15:04.180economy situation to reopening the economy and doing everything we could to achieve a soft landing
00:15:14.720for the Canadian economy after the trauma of COVID, the COVID lockdowns, the COVID recession,
00:15:22.380the economic trauma. That meant that we were particularly focused in the economy on two
00:15:30.180things. One was supply chains. You know, by now, I think it's sort of become part of the common
00:15:40.640discourse that supply chains were strained by COVID. It was maybe less apparent to regular
00:15:48.840Canadians in January of this year, but it was really apparent to us that the peculiar nature
00:15:56.180of the global economy during COVID had placed some very significant strains on supply chains.
00:16:03.520That was jeopardizing Canada's recovery from the COVID recession in areas like the lack of semiconductors putting real stress on our car sector, to give just one example of very specific supply chain problems that we were focused on and thinking about.
00:16:24.120The second area we were really focused on, which, again, has moved more into what everyday people are talking about, but we were focused on it already in January, was we could see, partly because of those strained supply chains, that inflation was elevated and rising.
00:16:46.660And so it was apparent, I think, to us that we were going to be moving from the COVID recession situation where the challenge was, you know, prevent the greatest downturn since the Great Depression in Canada from really taking hold and scarring the Canadian economy.
00:17:11.380that had been the preoccupation during COVID. We knew that we were moving into an environment where
00:17:18.040the challenge was reopening and elevated inflation. And how do you deal with that?
00:17:24.900And that made us particularly concerned again about the supply chains because they posed a
00:17:29.800challenge to elevated inflation. So I would say that was kind of my finance minister budget-related
00:17:37.040set of concerns. The second economic issue that I was very focused on in December, January,
00:17:47.540November, December, January, was the U.S. Build Back Better legislation, and in particular their
00:17:56.240proposal on EV incentives. And I realized to an Ottawa kind of maybe legal community type
00:18:07.020audience, that might seem a little bit esoteric. But the reality is, and it might seem a little
00:18:16.340bit esoteric and a little bit specific, the EV incentives as proposed by the U.S., and that
00:18:25.100legislation made its way through the House in the fall in the U.S., I believe in November,
00:18:30.500that legislation as proposed would have been completely devastating to the future of the
00:18:38.780Canadian car sector. What the incentives would have done had they been passed into law as
00:18:48.100initially proposed is create very strong incentives for buying electric vehicles
00:18:55.340that were made in the US, not North America, just the US. And EVs, that's a national industry,
00:19:04.340right? We're just shifting to the production of EVs. Imagine if you are a car company
00:19:11.980and all the car companies that produce cars in Canada operate on both sides of the border.
00:19:18.300Imagine these powerful U.S. incentives are put in place, but they only apply to EVs and
00:19:25.100batteries made in the U.S. Are you going to build anything in Canada? Are you going to put any of
00:19:30.640those production lines in Canada? And the answer is you wouldn't have. And, you know, these
00:19:36.340incentives, frankly, were quite intentionally designed to drive all of the building of the new
00:19:45.460fledgling EV industry into the U.S. only and to create a powerful economic disincentive
00:19:54.740to build any of that in Canada. That would have been a disaster for us because EVs are the cars
00:20:01.500of the future. And to just give you a final kind of sense of how significant this was,
00:20:08.600At the end of 2021, marrying the trade minister and I sent a letter, which we made public to the U.S., warning that Canada was prepared to retaliate at scale were this measure to be passed into law.
00:20:29.000Well, in December, in finance, we were looking at and putting the final touches on a retaliation list, because whenever there is trade retaliation, the first step is you publish the list of things you might retaliate against.
00:20:47.660We did that during the 232 challenge, shall we say, the 232 tariff challenge.
00:20:56.100The initial retaliation list that we were looking at was going to include up to $100 billion of U.S. imports into Canada.
00:21:10.300So that's to give you a sense of the scale that we judged this challenge to be at.
00:21:20.640We really didn't want a trade war that would have been terrible for Canada, and so we were also negotiating, and we were talking, all of us, the Prime Minister with President Biden, Mary Ng with the USTR.
00:21:38.780I was speaking about it with Janet Yellen at the Treasury, and really the key person emerged as a guy called Brian Deese, who is in the White House.
00:21:51.160He is the president's economic advisor.
00:21:54.400And what we were trying to persuade Brian Deese of is the idea that, look, we understand that you want incentives for electric vehicles.
00:22:08.200we also believe in the green transition. We understand that you want U.S. workers to benefit
00:22:14.880from these incentives, but our car sector is very, very closely interconnected. A favorite line that
00:22:23.200you'll hear every single Canadian trade negotiator who ever has negotiated mentioned to the Americans
00:22:28.360on this is, a single car part can cross the border six times on the way to becoming part of a car.
00:22:34.800So we say that all the time to the Americans. And so what I said to Brian is our sectors are totally integrated. We're not asking for a free ride from the U.S. Why don't we match your incentives? And you guys have incentives. We'll have incentives too.
00:22:52.800And both of us have incentives for North American-made EVs, thus creating a level playing
00:23:01.480field between Canada and the U.S. and frankly, a strong incentive for investment into Canada
00:23:09.460because in that kind of an environment, Canadian-made EVs would be uniquely able to be sold
00:23:18.320into the US market. So that was what we were talking about precisely at that time. And in the
00:23:26.840month of December and January, we were drafting these ideas. My department was working on it
00:23:33.660and I was sharing them with the treasury and with Brian Deese. And actually at the very end of
00:23:41.220January, my department prepared for me a sort of yet another iteration of this sort of
00:24:04.320We knew we had to make this work coming at exactly that time.
00:24:09.340And then the final thing, which was more maybe a deputy prime minister area of focus, was Russia and Ukraine.
00:24:21.180The war hadn't started yet, but we and our allies started to get intelligence in December and in January that Russia could well be preparing to invade Ukraine.
00:24:37.200I was briefed directly at the beginning of January that the judgment was this could really
00:24:47.100happen. And again, it's happened now. So we might not fully remember how astonishing
00:24:54.580and horrifying that thought was before it actually happened. It's horrifying now too,
00:24:59.840of course. So, you know, that, that was a very big deal. I learned about it at the
00:25:07.200And the threat just kept getting greater and greater and greater.
00:25:11.520I believe NATO troops were put on alert at the end of January.
00:25:18.880And then I think the U.S. took this extraordinary step of declassifying its intelligence about Russia's plans in early February to kind of alert everyone.
00:25:31.480And I was also involved at the finance minister level, working with other finance ministers, talking to the Ukrainians about putting together sort of preemptive sanctions.
00:25:43.360If you think back to that time, the idea was we would be very explicit with Russia about the sanctions that would snap in in the event of an invasion.
00:25:55.760So that was kind of a third area I was very aware of.
00:25:59.560I thought then, and I think today, that Russia's invasion of Ukraine, which of course did ultimately happen, is the biggest challenge to Canada's national security since the Second World War.
00:26:14.440I think it's a very serious attack on Western democracies, on the rules-based international order.
00:26:22.580I took it seriously then, and I believed it was really important for Canada to be in a strong position to be able to respond.
00:27:02.760That would be a risk to Canada's national security.
00:27:05.460Well, Vladimir Putin's invasion of Ukraine is the first time that one internationally recognized state has tried to conquer or seize the territory of another since the Iraqi invasion of Kuwait.
00:27:25.320It's a very grave violation of what I think is one of the greatest accomplishments of the post-World War II international order, which was, you know, a basic, basic understanding that internationally recognized countries don't invade each other and seize each other's territory.
00:27:53.460Now, that has not been perfectly honored. But if you compare the entire post-World War II period with all of human history prior to that, it's a huge change. And that has hugely enhanced the security of every country in the world. So that's number one.
00:28:16.340Number two way that Canada's security was threatened is threatened, but I think the allied response has been strong and has strengthened Canada, is I absolutely believe that one of Vladimir Putin's war aims, you know, his principal objective was, is to crush Ukraine, to take it over.0.87
00:29:13.800because he wants that demonstration effect he wants to show russians you know you might not0.98
00:29:20.580like that much how things work here but we're better than those you know weak feeble pathetic0.92
00:29:28.360western democracies how are they letting this bs propaganda he wants to communicate on the stand0.96
00:29:33.840at this commission this is outrageous and his success were he to be successful
00:29:41.520i absolutely believe would weaken western democracies writ large including our own
00:29:51.180okay um that's i think helpful context for for uh if you'll agree with me for the what was in
00:29:59.700your mind essentially as the convoy arrived in late January you've said that that dovetailed
00:30:04.940basically with your negotiations on the on the electric vehicle incentives and in the chronology
00:30:12.700you can appreciate this is the second last day of the commission's testimony so we've we've been
00:30:16.400through a lot of the chronology of what happened in those early days and I want to focus with you
00:30:20.360this morning on your specific involvement and I think you've expressed to us in the interview and
00:30:29.640And you may agree or you may not, but you started to become very actively engaged in this file and this matter around February 6th, around the second SSE meeting.
00:30:49.300And that's kind of consistent with how I was describing my role.
00:30:53.400So I would sort of say up until that point, I was pretty much heads down. We have the budget. We have budget is sort of 90% of the focus. And then there's electric vehicles over here. Hope we can get a good outcome. Otherwise, it's going to be really bad.
00:31:12.580And, you know, I've spoken with a lot of conviction a moment ago about the significance of the Russian invasion of Ukraine.0.51
00:31:23.860But I want to remind us all at the end of January, beginning of February, it hadn't happened yet.0.98
00:31:29.920So that was just out there as a threat that I had in mind.
00:31:34.820So up until February 6th, 90% budget, EVs on one side, worried about Russia, Ukraine, hoping that we can put forward strong sanction ideas that will prevent it.
00:31:49.520But it was really budget, budget, budget.
00:31:51.220But then the second weekend of the occupation happened. And I started hearing particularly from business leaders that this was starting to be an area of concern. And so I did attend that committee meeting. And then as that week went on, I became more and more and more involved.
00:32:17.820Okay. And just to clarify, you wouldn't normally attend an SSE meeting, is that right?
00:32:24.160A standing invitation as Deputy Prime Minister?
00:32:27.200The Finance Minister has a stand. I think they call it an ad refio member. The Finance Minister can attend any Cabinet meeting that she or he chooses to attend.
00:32:39.460So on February 6th, you sort of invited yourself?
00:32:41.920I think my colleagues also thought it would be good to have me there.
00:32:45.340fair enough um okay so soon after that on february 9th your department produced uh an options memo
00:32:53.340and mr clerk if we can just pull that up quickly it's ssm.can403764
00:32:59.820okay so um minister freeland we've talked a little bit about this already but i i'd like you to
00:33:17.900take us through the the options and how this memo came about and the two options that are
00:33:22.740that are outlined here which are essentially amendments to sorry scroll down a bit please
00:33:27.760Mr. Clerk? The first option that's outlined, uh, until you get to, there we go. Um, so it would
00:33:35.060be potential amendments to the PCML TFA act. And then if we scroll down beyond that, you'll see
00:33:40.280amendments to the bank act. So can you tell us how you perceive these options, how the memo came about
00:33:45.900and, and what you did with this information afterwards? Sure. Um, and I think, so this was
00:37:17.120Um, as you know, um, I would say, let me say a couple of things.
00:37:23.620So on the FinTrack front, what we concluded was, you know, to put it in maybe kind of more regular terms, what we concluded, and this is something that finance officials had been thinking about for a while, is that basically the FinTrack monitoring authorities were appropriate for a 20th century economy.
00:39:46.240And then second area, which is outlined in this note, is could the Bank Act be used to allow the banks to effectively freeze accounts?
00:40:07.240That's basically what the memo discusses, and it discusses what would be the different authorities which would allow that.
00:40:14.360And so those were the options that were developed there.
00:40:23.260Maybe the final point worth mentioning with regard to that memo is in terms of a legislative path, what we understood was it takes a long time.
00:40:39.620And, look, it's a good thing that it takes a long time for legislation to be passed in Canada, even when we're working really together and urgently and quickly.
00:40:53.080And an example, you know, just this fall of Parliament coming together, understanding an urgent necessity and passing legislation was the bill that granted us the authority to double the GST credit, which we proposed as soon as we returned from the summer recess.
00:41:13.120it gained all party support and it speeded through and you know we got we proposed it in
00:41:21.040the middle of september and we got the first checks out to canadians on november 5th in
00:41:27.260parliamentary legislative time that is a sprint um and that was good because we know that canadians
00:41:34.440need inflation relief rulo is not happy by the way that's looking at that commission lawyer
00:41:39.140saying all right let's get on with it don't let her move ahead so and that's just one real life
00:41:44.020example where there was urgent action by parliament um and the senate and and the house and the senate
00:41:52.180and so while this we looked at what the legislative options could be we quickly understood that
00:42:00.440they would take a long time so skipping way ahead now but so the conclusion in the end was you did
00:42:07.000not have time to legislate? Not that, I mean, I think the short answer is yes. You know, basically
00:42:15.440the legislative timelines and the snowballing, sort of exponentially damaging impact on the economy,
00:42:27.440they were not, the legislative timeline was not appropriate to the scale and speed with which
00:42:35.360the damage was mounting um you mentioned uh in the course of that that you were having
00:42:42.100conversations and you were hearing from various stakeholders and business people etc so i want
00:42:47.540to spend a moment and also u.s officials off obviously so i want to spend not actually a
00:42:53.000moment a little while going through some of the the conversations that you were having and i think
00:42:58.020the best way to do this is with the assistance of some of the documents that we have may remind you
00:43:02.320the specific conversations um so we'll start with mr clerk ssm.can.401255 so this is a summary
00:43:13.200of your conversation while it's being pulled up uh with mr dease brian dease um on february 10th
00:43:19.540and you've already explained to us uh who mr dease is but uh just maybe go over that again so
00:43:26.060would you say he's the senior economic policy advisor to the president?
00:43:31.920100%. I would say when it comes to U.S. executive economic authority, the most important person
00:43:40.080is President Biden, obviously, and his most important advisor is Brian Deese. And then,
00:43:47.780of course, Secretary Yellen is a very significant and, you know, frankly, brilliant figure and
00:43:57.340player in all of this. And we were maybe just as a quick footnote, I don't want to offend the
00:44:04.020Treasury. In talking about these EV incentives, we were very much in touch with the Treasury,
00:44:11.160both with Secretary Yellen and with David Lipton, who worked in the Treasury. They were very aware
00:44:16.880of our proposals too and supportive of them is mr d someone you talk to often
00:44:21.840um i try to um what was striking to me about the conversation i had with him on the 10th of
00:44:33.660february is he is a person who is very hard for canadians to get a hold of um and actually in the
00:44:45.520fall when we realized how significant the EV issue was. And when in my conversations with
00:44:54.440the Treasury, I really learned how important the White House and Brian Deese were. And also our
00:45:01.260ambassador, Kirsten Hillman, sort of identified to us, Brian Deese is the guy you have to talk to.
00:45:07.280And it was a real effort to develop a relationship and a dialogue with him.
00:45:15.520and an effort to get it, always an effort to get him on the phone, to get him to answer
00:45:21.900an email. And I don't mean that in any way to slight him. He's an extremely busy person.
00:45:28.500In a way, the fact that it's hard for Canada to reach him is a good thing. It means we're a peace
00:45:35.820order and good government country, and they're not very worried about us. And so what was really
00:45:42.300striking to me was how quickly he got on the phone with me on that Thursday. It was instant.
00:45:50.860And while in some ways, you know, that was in, as a practical matter, that was good,
00:45:56.260but it gave me a measure of how worried the White House was about this.
00:46:04.300Okay. So let's look at the summary of the conversation you had with them. Mr. Clerk,
00:46:08.720if you can just scroll down to so we can see that entire part of the email yeah okay so
00:46:15.440starting february 10th so this is you mr freeland writing and say he called me they are very very
00:46:22.680very worried if this is not sorted out in the next 12 hours all of their northeastern car plants will
00:46:29.580shut down he said that he supposed that this proved the point that we made previously to them
00:46:34.380about how closely integrated our economies are.
00:46:38.120He did not seem to see this as a positive.
00:47:04.380So can you flesh out that summary a little bit of what Mr. Deese was conveying to you?
00:47:10.720Yeah. I mean, you know, I think, can you move up a little bit?
00:47:15.220Just, you know, I think the point, the second sentence, he said that this proved the point about how integrated our economies are, and he didn't seem to see this as a positive.
00:47:25.420he brought that up and you have to kind of bear in mind I have been bugging the guy and Canadians
00:47:32.740have been nagging Americans since the fall and we've been saying guys you don't understand Canada
00:47:38.780you don't understand how integrated our economies are this approach you're taking to the EVs it's
00:47:44.580completely counterproductive for you because we work so closely together those parts they cross
00:47:50.020the border six times. We've been saying this over and over. And so he comes back at me and he says,
00:47:56.640yeah, okay. Like you've made the point. We get it. And it was a surprise to him actually,
00:48:04.120the extent to which their car industry was dependent on the trade with Canada.
00:48:11.300but that was a dangerous moment for canada i felt very very dangerous because the u.s then0.98
00:48:21.880and now as so the u.s perceives canada as a whiny bitch their own soft landing from covid0.97
00:48:29.800something that is happening there is a real move to protect the supply chains of the united states0.97
00:48:39.380The same supply chain challenges I was talking about earlier as affecting Canada affected the US. And I think we have all seen a very strong push this year by Americans to insulate their supply chains, particularly from China.
00:48:58.420are very worried about the semiconductors, but more broadly, COVID brought alive to them the
00:49:05.580vulnerability of their supply chains. And this was so worrying to me because I could see really
00:49:13.800for the first time ever, the Americans having this amber light flashing in Canada and this amber
00:49:21.480light that said to them, you know what? The Canadian supply chain could be a vulnerability
00:49:25.800to. And that's a problem for us, because there are plenty of Americans, both Democrats and
00:49:33.120Republicans, who would love any excuse to impose more protectionist measures on us. So that line
00:49:42.120to me, it jumped out at me, it made me really, really worried. And I understood, I really
00:49:51.860understood at that point that the danger wasn't just the danger of the, it wasn't just the
00:50:02.680immediate damage. It wasn't just the immediate harm. It wasn't, oh, you know, this plant loses
00:50:09.840four days of operation. The danger was, were we in the process as a country of doing long-term
01:02:00.980For me, the salient point was the first part of his message.
01:02:06.880And, you know, I think what he says there, and he runs Stelco in Hamilton.
01:02:16.280He is American, though, and U.S.-based.
01:02:18.620Um, what he was saying at the beginning about onshoring and relocating to the U.S., that's what I was talking about earlier today.
01:02:29.780And I kind of highlight that for all of us here just to kind of make clear to everyone that for people whose bread and butter, whose livelihoods were in the U.S. trade-exposed industries, their immediate conclusion, you didn't have to think about it,
01:02:55.260Um, the immediate conclusion from the blockage of trade was the Americans are going to respond
01:07:36.580um I do uh sort of as a matter of course meet with the bank CEOs as a group every six months
01:07:46.240and obviously they can and should have access to me like they should be able to meet with me
01:07:52.740um but it usually takes a while for people's calendars to work um and for the meeting to be
01:08:00.380range. And it's highly unusual for them to want to talk to me on a weekend. So that was significant
01:08:08.500to me, that they wanted to talk to me on the phone. I spoke to both of them. I am sure, pretty
01:08:16.980sure, well, 90% sure I spoke to both of them before this call at 1pm on Sunday with all of
01:08:24.120bank CEOs and each of them expressed a high degree of concern about the damage being done
01:08:33.120to Canada and the Canadian economy which was then reflected in the group call. Okay so let's have a
01:08:39.700look at that group call now. Mr. Clerk it's ssm.can408766.
01:08:54.120so this is about a three-page document Mr. Freeland I'm just going to take you to certain
01:09:06.360excerpts of it that I'd like you to elaborate on so the first one Mr. Park if you just go there we
01:09:12.060go we don't know who's speaking here but whoever it is one of the bank CEOs says the big hole in
01:09:19.460our financial system is these platforms, which are effectively money service businesses that
01:09:24.380are not being regulated as such. So that these platforms refers to the payment processors,
01:09:30.060the crowdfunding platforms? I believe so. I mean, I shouldn't put words in the mouth of another
01:09:36.420person. But I think one of the messages that I recall came through in this call, and that,
01:09:44.300you know, my memory was refreshed when I looked at these notes. One of the messages from the
01:09:49.260bank CEOs was kind of what finance had concluded independently earlier in the week, which is
01:09:57.420there's this whole space where financial transactions happen that no one has any line
01:10:04.840of sight to. And that is the crowdfunding platforms, the payment systems. And then I
01:10:16.160think someone also mentions crypto later on in this call. Yeah, I think they do. That's right.
01:10:21.500So we'll just scroll down a little bit there. I'm not sure we're going to get to crypto just yet,
01:10:26.200but we are going to get to your response here where you say, I'm very prepared to come out
01:10:31.840and speak about this. This is an attack on democracy. We need to educate Canadians about
01:10:37.080this. What do you mean by this is an attack on democracy? So I was responding specifically
01:10:43.820to one of the CEOs whose bank had acted to freeze an account. This was prior to the invocation
01:10:57.120of the Emergencies Act. It was based, as that note shows, on what the bank's anti-money laundering
01:11:08.480systems detected. And based on that, the bank rightly acted. What was a concern for me, and this
01:11:18.340was, this did shape how we acted, was the banks being blamed for taking this action. The banks
01:11:31.860being seen as choosing to do it, as having the agency. And it was particularly a concern.
01:11:42.640And you note the mention of Fox News. The thing you have to remember about Canadian banks
01:11:48.080is many of them are significant banks in the United States as well. They are big players there,
01:11:56.020And some of them trade under their Canadian names.
01:12:01.480And so they were in jeopardy, not only in Canada, but also in the United States, if they were being seen to be taking a politicized position.
01:12:16.780I didn't think that was their responsibility.
01:12:19.260I thought it was the responsibility of the government to make judgments about this.
01:12:23.020okay um the next concern highlighted there is uh canada's reputation is indeed at risk we need to
01:12:32.900show the world proactively that we won't let this happen again our trade corridors will remain open
01:12:38.720we should think about putting the military in place to keep the border crossings moving
01:12:42.960even after the protesters removed to send a clear signal so this is about as strong a
01:12:48.340suggestions you can get bringing the military. And your response here is, couldn't agree more
01:12:55.100with those points. We must make clear that one, we won't resolve this, and two, we won't let this
01:13:00.120happen again. So can you explain your response there? And were you agreeing there that bringing
01:13:08.020the military to patrol the borders was a viable option? No. It was, I mean, look, if you look at
01:13:15.840that conversation, people raised lots of different points in their commentary, and I didn't respond
01:13:23.940to every single one. Just as in my previous exchange with Alan Kestelbaum, our Stelco guy,
01:13:32.500I acknowledged his concern, but I didn't really address his public health measure point.
01:13:38.980But my point there was, as I said in my follow-up, that what we need to do is, as a government, one, resolve it, two, be clear it's not going to happen again.
01:13:51.040And, you know, from my perspective, I wanted, the reason I convened that call, and again, probably worth highlighting, it is highly unusual for the CEOs, like, highly, highly, like, never, I mean, I've only been finance minister for two years.
01:14:13.460But it hasn't happened before, and I hope it will never happen again.
01:14:18.560For the CEOs of all of Canada's banks on, you know, a couple of hours notice on a Sunday afternoon to come together on a Zoom call with the finance minister and deputy minister of finance.
01:14:35.260It's very, very unusual for them to find the time to do that.
01:14:41.220I'm right now trying to organize a meeting with them, my kind of every six month meeting
01:14:47.420for December. And it's the kind of thing that we sort of organize four to six weeks in advance,
01:14:55.900because these are all busy people. So that's kind of just worth mentioning,
01:15:00.900shows their degree of concern and anxiety. Value for me of this meeting, why did I want to have it?
01:15:07.600what did I want to get out of it? Two things. One, I wanted to hear from them. How worried
01:15:15.600were they? By that point, I was really worried. But we were contemplating, as you know,
01:15:24.700really serious action. And I needed to hear directly myself from the leaders of Canada's
01:15:36.100financial institutions? Did they share my level? That was a very important proof point for me.
01:15:44.380So that was kind of number one. And it was important for me, for them, it was important
01:15:51.540for it to be a meeting of everyone, because that's also a measure of how worried were they,
01:15:58.060right? Are you prepared to say these things to a group of your peers? Is that, that's,
01:16:04.080you judge your words carefully there and you should. So number one, am I right to be as worried
01:16:12.540as I am? What do these guys think? And then number two concern was, okay, we do have some tools.
01:16:22.820How are the tools working? The people who have these tools, who are in charge of using them,
01:16:29.620how are they finding they work in practice those were the two things I tried to get out of the call
01:16:34.380and it was a very useful call in terms of answering both those questions so maybe the
01:16:40.280next extract I wanted to point out goes to that second point um Mr. Kirk can you just pull down
01:16:45.300a little bit there we go so this is someone saying we need court orders to act we'd identified an
01:16:51.880individual who was an organizer who had several hundred thousand dollars move into their accounts
01:16:57.320we flagged it to fintrack started work on a court order and because of the delay of four hours the
01:17:03.300money was withdrawn before we could stop it and you say there you you asked was the problem there
01:17:08.860a gap in the current system or that it moves too slowly and and reply of four hours was too long
01:17:15.840um and then i think underneath that there's and let's be clear this that's the the reference you
01:17:22.740were talking about and let's be clear they will all eventually move to crypto okay um a little
01:17:29.200lower down mr clerk bottom of that page you mentioned reputational risk that's something
01:17:34.880you've talked about several times here's one of those i think quotable quotes agree with my
01:17:39.500colleagues reputation of canada is at risk just spent a lot of time in the u.s last week and we
01:17:45.000were be called a quote-unquote joke by people i had one investor say i won't invest another red
01:18:02.840Well, I mean, I believe and subsequent conversations underscore,
01:18:13.260you know, if I were an editor, I would ask my,
01:18:16.020if I were still an editor, I would ask my reporter,
01:18:17.740is that a direct quote, or are you paraphrasing? And I think subsequent conversations we had
01:18:24.920show that was a direct quote. And a direct quote that a Canadian bank CEO was relaying to me
01:18:36.700that he had heard on an investment trip to the US from someone who he wanted to invest in Canada.
01:18:44.960He was trying to persuade someone to invest in Canada. And that was a heart-stopping quote for me. That was really a moment when, having already been concerned, when I really understood that what was happening was profoundly jeopardizing the Canadian economy.
01:19:13.560and putting investment in Canada at risk.
01:19:18.400And, you know, I don't expect you guys
01:26:58.300So you're reporting to the IRG on the economic impact, and you say the minister highlighted ongoing economic losses of 0.1% to 0.2% of the GDP for every week the blockades continue.
01:27:15.560Now, we know at this point that that didn't come from an internal Department of Finance analysis.
01:27:20.480I believe you were referring to something that had been reported in a Bloomberg article. Is that right?
01:28:21.740Um, my objective was in a succinct way to convey to my colleagues who aren't responsible
01:28:32.500for the economy, um, that this was a really serious economic impact.
01:28:39.180So I think that it was possible, um, you know, say you're a cabinet minister, you don't have
01:28:48.540principally economic responsibilities, you might be seeing this mostly as about, you know, damage
01:28:57.140to Ottawa shopkeepers. And that's really serious. I don't want to understate the human toll of that.
01:29:05.100But what I wanted to communicate was this is getting to have a macro impact that will be material on the Canadian economy.
01:29:22.360And the only other thing that I would say is, you know, with hindsight, if anything, I feel that number, I feel that that statement, if that's all I said there, I feel that statement understated the possible impact because the real challenge was it was exponential.
01:29:45.980So as it happened, that trade blockade was effectively a week-long thing.
01:29:54.440And that's what statistics ended up recording.
01:29:57.880But had it gone on, then you would have seen not an arithmetic adding up the damage of week plus week plus week.
01:30:07.120I think what you would have seen and why this really rose to the level of a profound threat to Canada's economy was the exponential nature of it, that the longer it went on, the greater threat that the U.S. would lose faith in us and our trading relationship would be irreparably damaged.
01:30:30.100The longer it went on, the greater the threat that foreign investors would write off Canada.
01:30:36.220Okay. So obviously that was a concern that you were expressing to your cabinet colleagues that day.
01:30:43.900Probably more clearly to you right now than I did then, but I think I did communicate to them. I was really worried.
01:30:50.020Okay. So the overall economic impact, both near-term and long-term. We can take that down now. Thank you, Mr. Clerk.
01:30:57.560The next topic I want to address with you is another concern that was being expressed around this time, which is the issue of foreign funding and foreign influence and money flowing, largely, I think, up from the U.S. to fund the convoy.
01:31:16.920So, Mr. Clerk, can you pull up, please, SSM.can401846?
01:31:56.880So this is a question that you've posed to your officials, and the question is, and do we have any info on foreign donations?
01:32:05.280And the response that comes back is, we do not have any information on foreign donations that entered our Canadian financial systems.
01:32:12.560It is possible that Fintrack, CSIS, or the RCMP possess information on foreign donations, but that information is not shared with the Department of Finance.
01:32:22.100So is it fair to say that at the points at which foreign influence, foreign donations were being talked about, the government wasn't actually in possession of information to corroborate that?
01:32:39.200What I would say is a couple of things.
01:32:43.000One of the things that this occupation and the blockades really brought to our attention was how little official insight we had to crowdfunding and payment platforms, how little we knew for sure about what was going on there.
01:33:13.000And we've talked about that, and we have since acted on a permanent basis to correct that.
01:33:27.960There was very good reason to believe, and in fact, the subsequent report that the commission
01:33:40.440did that I thought was very good on foreign donations, documents in a lot of detail that
01:33:48.120there were foreign donations coming in to support the convoy. And so, you know, that was happening.
01:33:57.500Our own systems were weak at officially picking that up and slow. And quite rightly, actually,
01:34:10.440there are a lot of checks and balances within the Canadian system about what finance specifically
01:34:20.700learns right because law enforcement and finance are operate in different silos and certainly
01:34:30.720elected ministers and law enforcement have a lot of silos between them and I think that's a good
01:34:38.440thing so yeah so that that would be that would be my understanding of the situation so to summarize
01:34:51.520that would it be fair to say you were operating a with incomplete information at that I would yeah
01:34:58.160I would 100% say that and the other thing I would say is you know we were operating in the fog of
01:35:05.880war. And we, things were moving very quickly in real life on the ground. We had to operate based
01:35:19.700on the best possible information we could get at every single moment. And sometimes that meant
01:35:29.540using open source information. It didn't always mean relying on official government information
01:35:40.040and analysis that came through the finance channels. And I feel, you know, not only
01:35:49.000comfortable doing that, but that that's the right thing to do. In a fast moving hour by hour
01:35:59.120situation like this, you have to gather information from a lot of different sources,
01:36:07.280reliable sources. But I believe that's the responsibility of an elected minister.
01:36:16.620And if you don't do that, my experience in government has been, you know, quite rightly,
01:36:23.940stuff that you officially get through official channels as a minister i don't know it's like
01:36:30.640flour that has been sifted many many times it's like very pure very verified it's gone through a
01:36:39.180lot of different hands and there has been a lot of different checks on it that's a good thing
01:36:44.760because it has you know government of canada stamp of approval and i think it's really good
01:36:49.480for us to have those systems. But at the same time, I think to do your job as a minister, you have to
01:36:58.300be aware of and actively seek out other sources of information, including open source sources of
01:37:10.160information. And I think you have to hear some things for yourself. That's, for example, why
01:37:14.740for me having that call with the banks directly was really really important and I wasn't just
01:37:21.440going to rely on other people telling me what they were hearing okay um so the the last thing
01:37:27.720I want to take you uh to on this point is ssm.can403807 please Mr. Clerk
01:37:34.780so this is a draft minister freeland of of um the section 58 explanation that was reported
01:37:53.000tomorrow and i'm sure you're familiar with that as we all are in this room right now
01:37:56.360um if we scroll down to page eight please mr
01:37:59.840bottom of the page i believe okay yeah sorry here we go so under item number six there roman numeral
01:38:10.620um this is a paragraph in the draft or a bullet point in the draft that says there is credible
01:38:16.820evidence that significant amounts of funding for the protests come from sources outside of canada
01:38:22.340which raises concerns about foreign interference in canadian affairs and questions whether they
01:38:28.040represent threats to the security of Canada and the comment made on that underneath it is
01:38:34.060anecdotal reports of donations from outside Canada to support the protesters were given
01:38:40.320credence when on February 13th hackers of the crowdfunding website give send go
01:38:45.080released hack data and it goes on to explain what happened there but that that bullet point
01:38:50.820paragraph there there is credible evidence that significant amounts of funding come from sources
01:38:56.740outside Canada was removed from the eventual Section 58 explanation.
01:39:07.860And do you have any comment on that at this point?
01:39:11.040I mean, I wasn't part of that process and of the drafting of all of that.
01:39:17.860and finance was not, we weren't the people responsible for looking at that aspect of what
01:39:31.540was going on. And, you know, as my previous comments have kind of underscored, I think
01:39:41.620my primary concern and anxiety around this was about the economic impact and we've talked about
01:39:49.940that at some length but that's that I felt my job was in the cabinet and as a team mate with
01:40:01.740my colleagues you know what were they relying on me as the minister of finance to do they were
01:40:06.380relying on me to figure out and communicate to them, how big is the economic problem?
01:40:15.920And then they were relying on me to figure out and communicate to them, look, finance guys,
01:40:22.020are you doing your job here? Are you awake? Are you using all the possible tools you have
01:40:27.720to stop the problem? That was my job number two. And then job number three is, okay,
01:40:34.760if you think it's a really big problem, which we did, if you think you're using all the tools
01:40:40.420which currently exist, which we did, number three, do you have any ideas? Is there anything
01:40:47.700in the finance toolbox that could be devised that would help? That was how I understood
01:40:54.740finance's job. Okay. So this would be more law enforcement slash intelligence area.
01:41:00.700Okay. We can take that one down, Mr. Clerk, and move on to, which sort of goes back to what you were just addressing, Mr. Freeland, what do we do about this?
01:41:15.360So the development and the implementation of the emergency economic measures order.
01:41:20.500So, again, we've heard at this point quite a bit about the orders and about what was done with them.
01:41:27.880So I want to take you to a few specific concerns that have been expressed about them.
01:41:32.920The first one being that the email was overbought in the sense that it might capture individuals who are not really directly involved in the protests,
01:41:41.940but people who donated to the protests and or have adverse effects on family members.
01:41:48.260You know, if you freeze someone's bank account, it may be a spouse or a child or someone else who suffers. So my first question was, was that, is that a concern that you were aware of? Is that a concern that you had? And is that a concern that you felt was properly addressed with the measures that were enacted?
01:42:08.400Okay, that's a lot of questions. But it's, I mean, that is kind of, I would say, core, you're getting at some core things we grappled with beforehand, during the time the measures were in force, and in our reflections afterwards.
01:42:29.400afterwards. And I want to start by saying something that I was really, really worried about
01:42:38.480and extremely conscious of the whole time was, you know, I've talked a lot about my profound
01:42:46.560conviction that Canada was in economic jeopardy.
01:42:50.940But then as we were talking about, okay, what can we do about it?
01:42:57.420I had probably an equally, um, profound and even emotional concern of, we don't want anybody
01:57:57.700Roughly 6 to 7 million people were being discriminated against based upon their status.
01:58:11.220Let's say it's 7 million. I think it's more, but let's say it's 7 million.
01:58:16.440So, look at the number of votes that Trudeau got.
01:58:22.060I'm not sure if you can see this in the last election.
01:58:24.060He forms the minority government, by the way, because the liberal vote is centered in areas with more seats, right?
01:58:32.360The conservative vote is more rural, less seats.
01:58:37.240In other words, conservatives win in a landslide rural seats.
01:58:41.880Liberals win very slim victories in urban seats.
01:58:46.960And that's why the Conservative Party, even with this O'Toole as the leader in the last election, that's why the Conservatives win the popular vote.
01:58:58.340Same thing the previous election with Andrew Scheer.
01:59:01.340So we see 5.5 million, 5,556,829 votes in total for the Liberal Party.
01:59:11.760whereas we see 5,747,410 votes for the Conservative Party.
01:59:20.760Now, first of all, the vote breakdown percentage left versus right in Canada is 65% versus 35%,
01:59:31.040meaning 65% of people in this country voted for a left-wing party, which is astonishing to me.
01:59:41.760However, if we take the six or seven million people who were discriminated against based upon their status into the next election and somehow coalesce all of those people, regardless of previous political leanings, right, left, center, up, down, I don't care.
02:00:03.460Skin color doesn't matter. Religion doesn't matter. I don't care.
02:00:07.300we're talking about freedom here right ultimately we're supposed to be in a free country
02:00:13.080so if we take everybody from that group 6.57 million people and have them vote one way
02:00:23.120whatever they decide to vote for and i'm surprised that
02:00:27.540a political party has not been created out of this grassroots movement that
02:00:34.760that we had last year sorry earlier this year but if we had something and people say well
02:00:40.900maxime bernier the ppc i say whatever just another politician i think what we need
02:03:49.220so we can do this we can come out of this
02:03:56.480but our next move needs to bring us back together again
02:04:04.580whatever that is i i've got an idea for it you some of you guys have heard it i'm going to talk
02:04:12.760more and more about it in the coming days and weeks but um it's going to take a lot of help a
02:04:19.720lot of organizing a lot of people behind the scenes so i'm working slowly on that in the
02:04:24.100meantime this week i wanted everybody to see what's going on at these at these ridiculous
02:04:28.540commission hearings especially because of the cabinet ministers who have been up on the stand0.84
02:04:34.400lying their faces up. We need people to see this. We need to see how sick these people actually are.
02:04:44.440And I don't know what it is, whether it's just excessive narcissism running wild,
02:04:49.140or if they have been actually deluded, somebody holding a watch, you will join us in world
02:04:58.180domination. I don't know. At one point, Christy of Freeland seemed like, I'm not going to say she
02:05:07.220was Mensa or anything, but she seemed like she was at least reasonable in articles she wrote 10
02:05:12.800to 12 years ago. You could read them now and go, this is not the same person. Justin Trudeau has
02:05:18.320always been a boob, a fool, a moron. We know this. I can't wait to see Brendan Miller go after him1.00
02:05:25.920tomorrow. Of the three main witnesses at commission today and tomorrow, Trudeau is by far the most
02:05:32.620vulnerable. Freeland, we'll see what happens. Katie Telford is going to be on the stand this
02:05:41.280afternoon. She is Trudeau's chief of staff, and she is probably the most savvy, intelligent one
02:05:48.320of the lot that we'll see in the next couple of days. She pretty much handles Trudeau. She's the
02:05:54.540one with the media connection. She is the one who plays all of these politicians. That's something0.99
02:06:00.580else we also need to concern ourselves with. And I'm sorry, I didn't mean to go on so long here
02:06:05.500during the break, but guys, the political operatives and the bureaucrats are a problem.
02:06:12.360We saw last week testimony from the secretary of the Privy Council, who is supposed to be
02:06:19.320apolitical, but no way. So that's the deep state. It's the bureaucrats. It's the people who work
02:06:29.780for the government of Canada. They're a problem, especially those at the highest levels. They all
02:06:38.080need to go because they are all following in lockstep with what Trudeau wants, happily.
02:06:45.160when a conservative uh government rolls in they do what the conservative party orders them to do
02:06:52.800but they do it at a much slower pace and they make the government look bad by dropping the ball
02:06:58.080all the time and they do it on purpose i know this because i know people who have been in those
02:07:03.700positions and they've told me about it and it's ridiculous so the whole bureaucracy needs to be
02:07:10.820looked at needs to be chopped by i'm going to say 20 to 30 percent yeah i'm not kidding and then the
02:07:18.780ones who rise up to the top because you know some of those positions are very key to the operations
02:07:25.400of the government of canada any government they need to come in and be apolitical do the job the
02:07:35.380government asks you to do no more and no less and do it efficiently right now we don't get that at
02:07:44.300all i'm you've seen the testimony you see how how one hand doesn't know what the other hand is doing
02:07:52.300when you've got 16 hands and none of them know what's going on and the emails are coming back
02:07:57.080and forth like this is just a gong show in there it needs to be efficient we don't need this many
02:08:02.460people in so many powerful positions. It just, it, it, and the egos as well. Nope. Things need to
02:08:10.720change. We can be the agents of change here. And I'm talking about positive change for all of us.
02:08:26.160And we are the, we're the vanguard here, guys. And excuse me for using that expression. I know
02:08:31.820that vanguard to many of you um means vanguard state street you know the people that actually
02:08:40.640run the world um it's up to us to tell the people out there
02:08:47.060what's going on you can do that by sharing this show you can do this by
02:08:55.440giving them facts even though they don't want to see them again i talked about this yesterday
02:09:01.680You know, the holidays are coming up. People are getting together. These conversations will happen whether we want it to or not. Sometimes you don't want to engage in that. Other times you're kind of drawn into it. Don't do it when there's any booze involved.
02:09:13.740The biggest thing that we can do from our side, and I'm not talking about, you know, giving them any amnesty either. I'm not talking about that. Just be polite and calm and measured in your responses to what they say. Don't get frustrated or angry or miffed because it will show in your body language, in your verbiage.
02:09:38.140you can't do that we have to rise above that when we talk to these folks
02:09:44.260it looks like the commission is set to come back so here's the deal the commission lawyer has got
02:09:53.580another half hour to 45 minutes and then they're going to start the cross this has been the morning
02:09:59.580break yeah so order a lot so she's got another half hour to 45 then it's either the lunch break
02:10:08.980which i doubt the commission has reconvened the commission or cross will begin so we'll see
02:10:13.620about 15 minutes left in the examination so we may actually clock in on time uh it's great
02:10:19.960um minister freeland when we left off uh the next topic that we we planned on addressing was the
02:10:27.960issue of donations and uh to do that mr clerk can you please pull up ssm.can403972
02:10:36.640and to be clear the the issue that we're getting at here is whether donations are captured a small
02:10:49.160donors are captured by the measures that were enacted and um what we've heard in the evidence
02:10:55.000was that the position taken essentially by the RCMP was this is not who they were targeting.
02:10:59.960They were targeting influencers. They weren't targeting small donors.
02:11:03.900So this is a text exchange between, I believe, two of your staffers.
02:11:08.040Can you tell us who Alex Lawrence is there?
02:11:10.520Yes, he's my director of communications.
02:11:12.560Okay. So the comment made here, just scroll down a bit, Mr. Clerk, is
02:11:18.280Freeland highly skeptical of this, thinks that the banks will have frozen some smaller
02:11:23.280accounts and we just won't know. Is that an accurate depiction of your thinking around this
02:11:29.820at the time? Were you concerned that small donors, when I say small donors, I'm talking about the
02:11:37.120amount of the donation, were being captured by these measures? What I remember being concerned
02:11:44.200about, and again, this isn't something that I wrote, it's something that Alex wrote, so I can't
02:11:51.480speak to his specific conveying of what I said to him and what I was concerned about.
02:11:59.580But once we put the measures in place, I knew this was an extraordinary action.
02:12:11.140The kind of thing that I hope only happens, you know, once in a generation.
02:12:16.380and I knew that Canadians were very focused on what was happening
02:12:29.700and concerned about it and it was very important for me
02:12:34.940having taken this extraordinary step to be as careful as possible
02:12:42.400in communicating what was happening not to over egg the pudding not to stretch the truth
02:12:52.160and I didn't want to make a flat statement that no small donors have had their accounts frozen
02:13:03.640although I very much hoped that was the case I didn't want to make that categorical statement
02:13:09.980unless I knew for sure that was the case because I really did understand that we were, you know,
02:13:21.100in terra incognita and it was really important for us to do everything we could to maintain
02:13:29.360public confidence of Canadians in their government, including the confidence of the Canadians who
02:13:37.800disagreed with us, maybe most of all the confidence of those Canadians. And so my skepticism was sort
02:13:46.640of about saying to my team, if I'm going to be in question period, if I'm going to be in a press
02:13:52.580conference, I only want to assert things that are absolutely true. And the position I didn't want to
02:14:02.240be in was to take this example of donations. I'm really glad that no small donors had their
02:14:08.960accounts frozen. That was a good outcome and the one that I hoped would be the case.
02:14:16.480But I also knew that things were happening in real time. And what I didn't want to have happen
02:14:22.980was for me to go out to say categorically and reassuringly, don't worry. If you made a small
02:14:31.560donation your account isn't going to be frozen and then have someone show up and say well actually
02:14:36.880it was because had that been the case and had I categorically asserted otherwise then people who
02:14:46.380already had real doubts about our government would be feeling wow these guys are even lying to us
02:14:53.700so that's where my skepticism came from okay so would it be fair to say then that perhaps the
02:14:59.700intention was not to capture small donations in the measures, but they weren't crafted in order
02:15:05.680to be able to avoid that outcome specifically, and therefore you couldn't guarantee that that
02:15:11.440had happened? Yes. Okay. The next issue I want to address briefly is, Mr. Clerk, can you pull up
02:15:52.460If we go to the top of page 7, so there's the banks themselves, and then there's the
02:16:04.580issue of the bank employees themselves, so the people who are working there who have
02:16:08.400now essentially become frontline officers in this particular area.
02:16:12.640You voice this at the minutes of the February 19th IRG.
02:16:17.400The Deputy Prime Minister and Minister of Finance noted that in conversations with the
02:16:22.460She is hearing concerns around the safety of bank employees, especially tellers who work at branches, who may be dealing with individuals who have had their accounts frozen.
02:16:32.540So what were you conveying there? What was the concern? What were you hearing?
02:18:29.920Okay, the next topic that I want to ask you about is, as you know, the commission, part of the commission's mandate is to examine the necessity of the measures that were taken.
02:18:39.700and whether the measures that were decided upon
02:18:57.800funding of the convoys, the funding of the protesters.
02:19:01.540We know that, but there were a number of actions
02:19:05.840being taken on that front by various actors.
02:19:09.180So in and around the time when the Emergencies Act was being considered by Cabinet, by the IRG, by Cabinet, by the Prime Minister, a number of things had already taken place.
02:19:21.360So just to list some of them, GoFundMe obviously had shut down the Convoys campaign on February 4th.
02:19:31.860TD had, and by the way, all of these are listed in the crowdfunding overview report that you referenced earlier.
02:20:27.960And so one of the things I think worth bearing in mind is, you know, sitting here today,
02:20:34.720um we kind of are judging a period of time that's frozen um whereas as we were making the decisions
02:20:43.220we were making the decisions in real time as things were evolving it's a real difference
02:20:47.420in perspective and I've been struck by it myself as I have reviewed documents to get ready for today
02:20:53.260Um, in that real time process, um, you know, I can't emphasize too much, um, the extent to which our preference, everyone's preference would have been for the actions to stop the blockades and occupation without the emergencies act needing to be invoked.
02:21:20.680That was overwhelmingly what we would have preferred to do.
02:26:31.080We went back with regulatory changes to give that authority to FinTrack in a permanent way.
02:26:38.460And I think Isabel Jacques has explained that, you know, I guess theoretically a person could say, well, why not just take that regulatory action on February the 14th or February the 15th right away rather than put it in the emergency measures?
02:26:57.060and regulation just takes longer to fully develop and to do properly but that was always the
02:27:05.600intention and we did it and I think that's good on the insurance um from my perspective
02:27:12.720it actually is good that we put it in place and it's good that we didn't have to use it
02:27:23.880Um, you will have seen in some of the previous, uh, in some of the previous documents you've
02:27:32.200discussed with me, um, and in some of previous testimony that a huge preoccupation was tow
02:29:41.980We've been at this for seven months and virtual tow truck is not an expression we've yet heard.
02:29:46.820um but getting back to the the substance of what you were saying there would it be fair to say or
02:29:54.780the emergency is it was revoked within about a week of the declaration of the emergency
02:30:00.400did it did it end faster than you expected it to
02:30:06.320i don't think i can answer that question because i don't think i had any precise expectation
02:30:19.620um in a situation like that i think um you have to just hope for the best
02:30:27.500and plan for the worst um and i think that's what we tried to do
02:30:32.420um almost done there's a there's a few texts i want to take you to now um that
02:30:41.560consist of some some discussions you had with various people after the act was invoked so the
02:30:49.360first one i want to pull up is ssm.can four zeros 4352 please
02:30:56.580so this is a discussion you had with parent beating can you just explain for the commission's
02:31:07.360benefit who parent bd is um okay and maybe for my benefit you can remind me what the date of this
02:31:14.560was because i don't remember the 22nd of february okay thanks maybe you already maybe you said that
02:31:19.980I didn't know. Sorry. Um, so Perrin Beattie, um, is the head of the chamber of commerce.
02:31:28.340Um, he is a person, uh, with whom I have now worked closely for a long time, um, during the
02:31:37.600NAFTA negotiations, also, uh, during the COVID recession, when we were working on our economic
02:31:46.580response. He is someone whose collaboration I really value, of course, because he represents
02:32:02.700the Chamber and Canadian small business, and that's an important constituency for the Department
02:32:08.860of Finance, obviously, but also because Perrin is a former Conservative cabinet minister.
02:32:15.260And in fact, is the guy originally responsible for the Emergencies Act. But in his capacity as sort of a former conservative cabinet minister, I do think that where possible, it's really good for a liberal government to try to have good relationships, good working conversations with former conservative ministers to understand that point of view.
02:32:45.260To, you know, I fully understand that we're talking now about a very strong action we took, which was polarizing for the country or which spoke to a time of polarization in the country.
02:33:02.500but parents specifically for me is an example of a person with whom I work hard to maintain a
02:33:08.780relationship because I think where we can have consensus in Canada where we can work across
02:33:15.700partisan lines and we can't always do that but where we can I think that's good for the country
02:33:21.400okay so let's see um what Mr Beattie wrote to you so presumably you were texting him about
02:33:26.560about the invocation of the act and he writes hi Christia thanks for your note while I'm still
02:33:32.380working my way through the implications the financial aspects you announced seem to be the
02:33:37.820most significant additional measures that the government took under the act then he goes on
02:33:43.500and says i certainly hope that we'll see an early non-violent end to the blockades although i am as
02:33:48.700worried i am worried as i know you are there are also lots of long-term issues we need to consider
02:33:54.220once this is over including whether we need to take other measures that could obviate the need
02:33:59.260to use the extraordinary powers in the act in the future and how to repair holes in our
02:34:04.140political system i'm particularly concerned about the radicalization of people who would
02:34:09.500normally be law-abiding mr clerk can you now pull up again it's in two separate documents
02:34:44.000So the first thing I want to ask, Minister, is would you agree that Mr. Beattie says the most significant additional measures taken by the government were the financial ones?
02:34:55.220Is that an observation you would agree with?
02:35:03.480I think they were significant, for sure, and effective.
02:35:08.660I'm not sure I would say they were the most significant, but I think for sure they were significant.
02:35:12.560Okay. And the other question I want to ask is, Mr. Beattie raises the issue or the possibility of considering other measures that could be taken to obviate the need for the Emergencies Act. Do you have any comment on that aspect of his?
02:38:13.700And I do have a relationship with him dating back to the NAFTA negotiations, where he was a very good and helpful advisor to me and to the government.
02:38:28.780So the date of that conversation is February 25th. So that would probably go back to your point about there were a lot of things going on at that time.
02:38:36.700Right. Russia invaded Ukraine on the 24th of February. And I think I can't, you know, I've sworn on the Bible what I'm about to say.
02:38:43.920I can't swear a hundred percent, but my recollection is that that conversation was actually chiefly about Ukraine and him giving me some advice and specifically that he thought it was an important opportunity for Canada to play an important role in the world.
02:39:07.680And he wanted to encourage me and, you know, through me, our government, not to underestimate the impact that Canada could have and the seriousness of this.
02:39:19.500So that brings me to the very last question I want to ask you, Minister, which is, this is something that's been touched on already in inquiry.
02:39:27.460We haven't really spoken about it yet today.
02:39:29.500But if you look at the Section 58 explanation, and I'm not going to pull it up because it's nothing specific, but in reporting to Parliament about why the act was invoked, much of that explanation focuses on economic security and the threats to, as we've talked about today, Canada's economy that we're in.
02:39:51.480and this has been now the discussion for about two hours today.
02:39:56.240What is the link as you see it between the threat to economic security
02:46:01.660And this is now just very sort of personal eyewitness experience.
02:46:06.800but, um, I don't normally have, uh, RCMP security. And I think that's a good thing.
02:46:15.020I think that says something good about Canada, but the RCMP,
02:46:20.540they know what I'm doing every day and it's their job to judge whether they think I need security
02:46:27.220or not. And I have to say to the RCMP officers who are here, who I recognize, they do a very
02:46:32.380good job of it, of making that judgment, I think. So a measure for me of how much Ottawa was a powder
02:46:42.180keg was the fact that I think from the end of January, the RCMP judged that I did need to have
02:46:49.680RCMP with me just walking around. And so I didn't feel personally in danger because the RCMP were
02:46:59.340taking care of me. But I do remember one morning, and I'm sorry, I didn't write it down in my
02:47:05.180notebook. So I can't tell you the date. But I remember one morning, when I was walking from
02:47:10.560my hotel to my office, I walked past a parked truck. And there was a young woman walking there
02:47:19.020two. And the truck honked really loudly. And she shouted something not very nice and made an
02:47:30.960obscene hand gesture. And the truck honked again really loudly. And I was really glad that I was
02:47:40.980there. And more importantly, that the RCMP was there. Because I thought this is exactly the kind
02:47:46.760a thing. Like imagine no one had been there. It was just this small young woman and this
02:47:53.400big truck and a person in it. And she was mad. And I just thought, you know, there are dozens1.00
02:48:02.200and dozens of these things happening every day. And, you know, God forbid that one of them should
02:48:08.640actually flare into violence and physical harm. So I was worried about that too.
02:48:14.420And that does speak to the economic challenge, because many, many Canadians, while this was happening, understood that this, for them, this threat to Canada's economic security, for many, many Canadians, it was a personal threat to them.
02:48:35.400And they felt that their government was not protecting them.
02:48:44.420And it was a real danger, I think, that that totally understandable and reasonable feeling that my economic security is being undermined by these illegal blockades and occupation, my government isn't taking care of me, maybe I have to take care of myself.
02:49:10.340and that would have been terrible had that happened that's why we have a government
02:49:15.220thank you commissioner those are my questions okay thank you so we're now uh we'll move to the
02:49:25.640cross-examination portion uh first i'd like to call on the convoy organizers for miller time go ahead
02:49:33.120please. Miller time. Here we go. Share this, you guys. Get it out there. Get it out there.
02:49:43.460I'm not sure how long he has. I'm hoping for at least 15.
02:49:56.560Hello. My name is Brendan Miller, and I'm counsel to Freedom Corp., which is the representative
02:50:00.940of the protesters that were in your city at ottawa in january and february 2022 so ma'am
02:50:09.140i understand the mandate regarding truckers that led to the protest it came into effect
02:50:15.500in january 15th 2022 is that correct i don't recall the exact date but i'm prepared to believe
02:50:23.940you are citing it correctly and during the pandemic from march 20 through january 15th
02:50:29.8802022, there was no such regulation, right? Again, I don't recall the exact dates myself, but
02:50:39.740I do know we didn't have the mandate and then it came into force. Just so the folks at home
02:50:44.500understand, a regulation is a different type of law. It's passed by the executive branch alone,
02:50:49.500not by all of parliament, right? Like the Emergencies Act. There is absolutely a distinction
02:50:55.960between things a government can do by regulation
02:50:58.960and things it can only do by legislation.
02:51:00.820And so would you agree with me that given that during the throes
02:51:06.160of the pandemic from March 2020 through to January 15th, 2022,
02:51:11.120and we had no regulation, you didn't need one?
02:51:17.220No, I actually, I believe that taken as a whole, the public health measures that Canada put in place were very, very important in the health and safety of Canadians.
02:51:35.180I only have so much time, so I'm going to cut you off there.
02:51:37.340And you'd agree with me that given that there was no regulation in place from March 2020 through January 15th, 2022, during the throes of the pandemic, there was no reason to pass one on January 15th, 2022, was there?
02:52:20.400I believe then, and I believe now, that creating strong incentives for Canadians to be vaccinated protected the health of vaccinated Canadians and protected the health of our country overall.
02:52:39.660Okay, so from March 2020 to January 15, 2022, did you fail to protect Canadians without having that regulation?
02:52:46.700Let me start with one aspect of that timeline, which is obviously, when COVID first hit us, vaccines didn't exist. And then even when vaccines arrived, it took time for them to be distributed. So of course, vaccine mandates couldn't be put in place before vaccines existed or were made available.
02:53:12.460So, and of course, the government, you ended up creating a vaccine compensation fund in December of 2020.
02:53:57.000Again, I'm not an expert in the history of vaccine compensation funds in Canada.
02:54:03.560But you can agree the first compensation fund in Canada for vaccines came about only because of the COVID vaccines, correct?
02:54:14.260Again, I'm really not an expert in vaccine compensation funds.
02:54:18.660If the direction of the question is to suggest that the COVID vaccines are more dangerous in some way than previous vaccines we've used in Canada, I'll say, one, I'm not a health expert.
02:54:32.520but i believe very much uh in really the advice the effectiveness the thoroughness
02:54:42.960of health canada okay they're very good at judging the safety of vaccines and i will say
02:54:48.640i have been vaccinated four times my children i understand ma'am i don't need to know that but
02:54:53.980but but it does speak it does speak to my confidence in the vaccine if i've had my
02:54:58.900children vaccinated it speaks to my belief that they're safe you stop talking out the clock and
02:55:02.760let me ask my questions okay so well it's it's a bit of a trade-off you you ask you make a statement
02:55:08.840and you say do you agree and she qualifies the answer that's appropriate okay but not for her
02:55:14.500to ramble on if that's the case then did health canada advise you to enact this regulation
02:55:20.500uh the mandate yeah um again i'm not the health minister and i'm not going to speak to specific
02:55:32.380moments that we had advice what i will say is we were very careful and thoughtful throughout covid
02:55:42.920in the public health measures that we put in place and acted based on advice of phap right
02:55:49.060And so that mandate was only in place until June of 2022, right?
02:55:56.680Again, I can't recall the specific dates, but I'm prepared to accept what you're saying.
02:56:02.640We're going to move on to just another area.
02:56:04.640I take it you know who Tamara Leach is, right?0.91
02:56:07.580I don't know her personally, but I have read about her.
02:56:37.100Danny Bulford used to be with the security team for the RCMP with the Prime Minister.
02:56:42.740I'm afraid I'm not so familiar with that final name.
02:56:46.160So Tamara Leach and Chris Barber, I've heard of.
02:56:48.940And when you were making your decision with respect to invoking the Emergencies Act, you'd already heard about Tamara Barber or Tamara Leach and Chris Barber.
02:57:11.240Yeah. And you knew about that before you invoked the Emergencies Act.
02:57:16.160Again, I can't say 100% not having reviewed what I read, but my recollection is they were reasonably prominent, and so I think it's reasonable to think that I would have read their names.
02:57:33.040And of course, you know Tamera Leach, she's a Canadian.
02:57:36.160Again, I haven't familiarized myself with her biography before coming here.
02:57:41.760She's from Alberta, do you know that, where you're from?
02:57:46.160I really haven't studied about her before coming here.
02:57:51.640I want to be careful that I say things I know for sure are true.
02:57:54.560I am certainly Canadian and I'm born in Peace River, Alberta.
03:02:56.200Yeah, and that Terry Fox statue, they put a hat on Terry Fox's head and then put a flag in his arm.
03:03:05.540And then there was a mandate freedom sign on it.
03:03:09.880I don't remember specifically what, how the Terry Fox statue was implicated in this, but I do remember reading about it, and I remember it specifically because my children were aware of it and were upset.
03:03:26.600Right, and so I went online and I just looked at how many times someone's done that to that statue, and it seems to be hundreds, so I'm just going to put this one to you.
03:03:34.940if someone puts an lgbtq flag on the terry fox statute and flowers in the statute is that a
03:03:41.620desecration i am not going to go into i really don't think it's my job or helpful for canadians
03:03:52.220for me to go into a discussion of what is okay and not okay yeah it's very helpful
03:03:57.560when you called it a desecration in public that was what you're referring to
03:04:03.760based on what was put on the statute so is it fair to say that it's only a desecration to you
03:04:10.540if you don't agree with the message again you've made a couple of leaps beyond anything that i've
03:04:17.660said you that's okay it's the public record um with respects to you had said you had concerns
03:04:25.900for violent actions and interactions um with respect to protesters and i take it that was
03:04:32.100nationally you had concerns nationally or was it just ottawa i described in my testimony a moment
03:04:40.800ago uh two specific areas where i had concern i was worried about the potential for conflict
03:04:49.960between angry people in ottawa and the occupation i can i finish the answer because i have something
03:04:58.680to add um and as i said in my earlier testimony and i believe the mayor of windsor shared this
03:05:06.400concern i was concerned about the possibility of that kind of a conflict in windsor and
03:05:15.360i was concerned about the situation in coots okay which which we heard about at the irg right on
03:05:25.360this saturday okay so but with respect to the interaction with protesters i don't know if you
03:05:30.340heard the testimony of the mayor there but he said that 75 percent of his small town supported the
03:05:36.100blockades and that many of the properties have f trudeau flags all over them so did you would
03:05:42.520have concern with that specific protest would you my reference to coots just now was very specific
03:05:52.380um at the irg on saturday the 12th of february the rcmp commissioner raised with us the possibility
03:06:06.540that there were weapons there and that was a source of great concern right and so you can
03:06:12.800agree that police investigate weapons offenses all over the country every day
03:06:17.260again i'm not a police expert but that seems like a reasonable common sense observation
03:06:24.000so simply because the police know a weapon is somewhere you can agree with me it's not a national
03:06:28.380emergency the concern about a single weapon somewhere in canada and as you say i think that
03:06:40.760one weapon being investigated somewhere in canada if that were to happen today
03:06:45.580certainly right and you testified um earlier about what you viewed as you know ensuring
03:06:53.900that we as canadians have a good international reputation so that people come to our country and
03:07:02.380want to do business with us is that fair yes that's something i was very concerned about okay
03:07:08.360and i take it when you consider those sort of things you look at various reports and i'm sure
03:07:15.560you look at various indexes and I'm sure you look at the Transparency International Index. Is that
03:07:21.800fair? I am familiar with the Transparency International Index, but I haven't looked
03:07:28.040at it recently. Okay. Well, since 2019, we've began to fall. All right. And we have now come
03:07:40.660down out of the top 10 and it continues to decline so can you agree with me that
03:07:49.620canada not being transparent hurts our relationship internationally
03:07:57.140where is he going with this i have to say that i disagree with the premise of the question
03:08:07.420I think Canada is a very transparent democracy, and in fact, the commission that we're part of right now is a part of Canadian transparency.
03:08:22.060And on that point, if I told you that there is a whole bunch of unlawfully redacted documents that we've been fighting over and waiting for an order just to get them today, and we haven't had them for this whole proceeding, do you think that's transparent?
03:08:37.420again and with apologies i can't agree with the premise of the question i think that but what i
03:08:46.480can say is i think that the fact that this commission exists that these hearings are being
03:08:53.200held that they're public is really important for canada and is a measure of canadian transparency
03:08:59.700And one of your concerns, of course, with transparency and our reputation, was that you would want your government to be as transparent as possible, right?
03:09:13.720again here i do believe that transparency and accountability are important
03:09:23.660but i also recognize that cabinet confidentiality in many issues needs to be preserved for a reason
03:09:32.980and you know there are areas where transparency is not appropriate and i recognize that as well
03:09:39.340Okay. Can you agree with me if, you know, anytime it comes out that the Canadian government has misled Canadians on something, it really hurts our international reputation, doesn't it?
03:09:51.640I think that the Canadian government should always seek not to mislead Canadians.
03:10:01.980First and foremost, because that's wrong and that is not the way we should treat Canadians.
03:10:08.000And in the many statements that have been said by all the politicians in this matter, one of the main things they talked about and Justin Trudeau did, particularly on the following the first weekend of the invocation of the Emergencies Act was these horrible, horrible Nazi flag and all those things that people saw in Ottawa.
03:11:26.320My name is Eva Krajewska and I'm counsel for the Canadian Civil Liberties Association.
03:11:31.120Minister Philan, I'd like to start off with going back to your testimony in chief with respect to the Ambassador Bridge.
03:11:41.260If I understand your testimony correctly, you stated that the blockage of the Ambassador Bridge escalated matters in your mind significantly.
03:12:00.940Yeah, but good afternoon, and I will try to answer your questions.
03:12:06.180And I think when you say testimony, you're referring to the two hours this morning.
03:12:10.920So to try to be precise, yes, as finance minister, in my judgment around the economic impact of the illegal blockades in occupation,
03:12:28.240certainly the blockade of the Ambassador Bridge was a very significant escalation.
03:12:33.300Right. And precisely the words you just used now, it was at least at that point, if not earlier,
03:12:41.660that to your mind, the blockades and the demonstrations became illegal.
03:12:46.040No, I don't think I want to be so precise about that.
03:13:01.080What I am very clear about is the blockade of the bridge made this a real economic crisis for Canada.
03:13:17.220And that was a moment when, as finance minister, I really had to figure out a way to stop the harm to Canada from getting worse and from really snowballing and irreparably damaging our country.
03:13:36.160And you said because it had potentially exponential harm to the Canadian economy.
03:13:42.660Yes. I mean, I wasn't taking notes of what I said, but I believe that.
03:13:47.020Yes. And that's when you started looking at the Bank Act and the PCLMFTA as potential using the measures under that legislation to stop those demonstrations.
03:14:00.780Again, here, let me be sort of very precise about my state of mind.
03:14:08.720um from my perspective the we had a number of different but uh certainly inspired by one
03:14:22.740another occupations and blockades across the country there was the occupation of ottawa
03:14:28.540and i i can't tell you the chronology of them i'm sure you're familiar with them but so there's
03:14:33.360occupation of Ottawa. There was Coutts. There was Emerson. In terms of economic impact, the
03:14:39.820Ambassador Bridge was the most significant. There was also, I believe, Sarnia, Niagara,
03:14:48.380and Surrey. So from my perspective, what was happening was this kind of metastasizing,
03:14:59.780whack-a-mole, copycat events around the country. And some of them had a greater
03:15:09.040specific economic impact than others. The Ambassador Bridge sort of stepped up the impact,
03:15:19.160but it was not the case in my view that this was just the Ambassador Bridge.
03:15:25.060And I didn't, that was not the purpose of my question, that it was only about the Ambassador
03:15:29.140bridge. I understand your evidence that the blockades generally had a significant economic
03:15:34.660impact on Canada that you were concerned about. That's fair.
03:15:43.220Again, can I say yes and offer an explanation?
03:15:49.920I'm not trying to make this controversial or to trap you. I'm just trying to establish this to
03:15:55.320move on to my next point. Okay. Well, I would just say you are a lawyer, so a person does have to be
03:15:59.600careful. And I say that with the greatest respect for all the lawyers who are here. But look,
03:16:06.800the point that I just want to be clear about, and I do think that there has been in some of the
03:16:17.000public thinking about this, a lack of clarity is from my perspective, one way that you could look
03:16:23.900at the economic harm was what happens every day arithmetically and just add it up. From my
03:16:31.900perspective, that grossly understates the potential economic harm that was being done.
03:16:40.600Because what I was really worried about was that as this goes on, every single hour, more damage
03:16:50.700is done to American confidence in us as a trading partner, and more damage is done to us as an
03:17:00.740investment destination. Witness the Banana Republic comment. Right, exactly. So you were
03:17:07.040concerned that this economic disruption was painting Canada as politically unstable, not a
03:17:14.440place that is safe to invest for, and potentially a Banana Republic, which by definition is an
03:17:20.060unstable country. I mean, Banana Republic wasn't my term, but it was a term that had
03:17:24.700an impact on me for sure. Okay. And now, Minister Phelan, you can appreciate that from the Canadian
03:17:31.680Civil Liberties Association, our concern is that the Emergencies Act should not be used to quash
03:17:39.340political dissent. You understand that? I totally do. And if I can be personal for one moment,
03:17:46.140in my life as a person and a writer and an elected politician, I would always prefer for
03:17:55.800myself to be on the same side as the Civil Liberties Association, that these are values
03:18:01.260I hold very dear. And so I understand the urgency with which you champion them.
03:18:10.920Right. And you and then so I think you would also agree that the Emergencies Act should not be used because demonstrators are disagreeing with government policy.
03:18:22.000I think that's a very low threshold here that I'm putting to you.
03:18:27.780And I think you also know in your life, both as a journalist and as a minister, that on occasion, the right to freedom of assembly and freedom of expression includes actions that are of civil disobedience.
03:18:45.880I do recognize that that sometimes happens.
03:18:50.300and I also recognize that laws are enforced against people committing acts of civil disobedience
03:19:02.380people can believe in something and can bravely commit those acts and pay the price of the legal
03:19:09.700penalty and exactly and civil disobedience will on occasion also involve serious economic
03:19:18.300disruption. And I'll give you a few examples. A general strike is a form of civil disobedience
03:19:24.380that causes economic disruption. You'd agree with that.
03:19:29.640If the tendency of these questions is to equate the economic harm that was being done to Canada
03:19:40.660and that would have risen had these illegal occupations and blockades continued with the
03:19:46.940harm done by a general strike, then I strongly disagree. Okay. And sometimes blockades by
03:19:54.480indigenous people cause economic harm, correct? They do. And sometimes occupations like Occupy1.00
03:20:01.900Wall Street or Occupy Toronto may cause economic harm. Certainly, but the economic harm, you know,
03:20:09.860to take those two specific instances um very very limited actually compared to the damage being done
03:20:18.660to Canada and if I may you know had what was happening in Canada being about um I don't know
03:20:30.860the the field behind the National Art Gallery being occupied for a long time and maybe some
03:20:39.620comparable public park in Windsor being occupied, and so on across the country. That would have been
03:20:48.540entirely legitimate protest, but that wasn't what was happening. Okay, maybe I can take you to an
03:20:54.800example closer to home. For me, when Solidarity had a general strike in Poland and blocked the
03:21:01.440ports, Western democracies applauded that action. Economic disruption was viewed as a legitimate
03:21:08.580form of political protest at that time? I'm going to allow myself one personal comment,
03:21:15.620which is I did make a bet with myself that you and I would end up talking about
03:21:20.380so you that much. Yeah, you know, coming from the Eastern Bloc, it was going to happen.
03:21:27.640Yeah, I am aware of that. And I don't think you'll be surprised to think that I thought1.00
03:21:36.920about that at the time. And more recently, and more specifically, I thought about the Maidan
03:21:43.680in Ukraine, and when we took this action. And let me talk about a few differences.
03:21:55.660and the main one is this. Solidarność, as you know very well, was a protest against a government
03:22:09.560that was illegitimate. That was where from whence it drew its power and legitimacy. This was people
03:22:19.080rising up against an authoritarian, and I would even say in the case of Poland,
03:22:25.260colonial regime. In Canada, what happened was a democratically elected government
03:22:33.060that was actually acting on policies that we had campaigned on just that summer. So it was a fresh
03:22:42.960democratic mandate. There was no lack of transparency with the people of Canada.
03:22:47.780and people who disagreed with those policies
03:22:53.960were holding the country's economy hostage
03:23:24.960And I am in no way, in no way suggesting
03:23:29.200that the act of protest is anti-democratic.
03:23:36.720On the contrary, the right to protest,
03:23:40.560I think it's a feature, not a bug of democracy.
03:23:43.500But what I was saying, which I believe very strongly, is there is a big difference between acts of popular resistance and even revolution against an authoritarian regime and protest in a democracy.
03:24:07.180And I'd like to just take you to, you started your comments this morning as well with the bigger geopolitical issues here between President Putin trying to demonstrate that his way of dictatorships is preferable to Western democracies.
03:24:30.200and one you know I think you can appreciate that there have been countries in the world that have
03:24:38.180said you should invest in us because we are politically stable we do not have general
03:24:44.260strikes we do not tolerate dissent and I want to end on this surely you agree that in Canada which
03:24:52.700is a democracy the right to protest the right to demonstration must be steadily protected
03:24:59.760and that economic security does not trump those rights.