WEBVTT - 66: Planes, Trains and Automobiles 0:00:00.240 --> 0:00:03.120 Brought to you by Bank of America. Merrill Lynch. Seeing 0:00:03.120 --> 0:00:05.560 what others have seen, but uncovering what others may not. 0:00:06.000 --> 0:00:09.680 Global Research that helps you harness disruption voted top global 0:00:09.720 --> 0:00:13.000 research from five years running. Meryll Lynch, Pierce, Fenner and 0:00:13.080 --> 0:00:17.119 Smith Incorporated. Actually it's a very interesting discussion. We could 0:00:16.960 --> 0:00:18.880 go on and on and on with that. I mean, 0:00:18.960 --> 0:00:20.640 if you want to have me on your show weekly on, 0:00:21.040 --> 0:00:25.560 I'll be happy to be your Canadian contributor. Well do 0:00:25.640 --> 0:00:40.839 at the infecast. Hi, and welcome back to Bloomberg Benchmark, 0:00:40.920 --> 0:00:44.000 a show about the global economy. It's Thursday, December eight. 0:00:44.159 --> 0:00:46.760 I'm Kate Smith and editor for Bloomberg News in New York. 0:00:47.159 --> 0:00:50.760 And I'm Scott Landman and economics editor with Bloomberg in Washington. 0:00:50.880 --> 0:00:54.360 D Suit Scott, how are you all right? How's it going? Kate? Well, 0:00:54.440 --> 0:00:57.160 I have to say I am kind of regret I'm 0:00:57.200 --> 0:01:00.920 not regretting, I'm dreading. My ride home. The subway that 0:01:01.000 --> 0:01:03.480 I take to get home is like you remember the 0:01:03.480 --> 0:01:05.840 pictures that they showed like post Sandy, of all the 0:01:05.840 --> 0:01:08.880 people's shoulder to shoulder in the subway. Well, it's like that, 0:01:09.000 --> 0:01:11.320 but somehow that's just like my day to day life 0:01:11.400 --> 0:01:13.920 every day in New York. But I've heard that it's 0:01:13.920 --> 0:01:16.280 even worse a d C. Well, you should be happy 0:01:16.319 --> 0:01:18.120 that you get a ride home at all, because in 0:01:18.200 --> 0:01:20.200 d C there are days when the trains aren't even 0:01:20.319 --> 0:01:23.280 running or they're shutting down large sections of track. I mean, 0:01:23.319 --> 0:01:26.160 we don't really have the problem with overcrowding anymore because 0:01:26.240 --> 0:01:31.280 ridership has fallen significantly. But that's incredible. I didn't realize 0:01:31.280 --> 0:01:33.440 that I would like to have your problem. I'd rather 0:01:33.480 --> 0:01:35.360 have that than there not running. Do you sound like 0:01:35.400 --> 0:01:38.479 the lesser of two evils though? Yeah, Well, I think 0:01:38.520 --> 0:01:41.120 what you and I experienced that is obviously pretty reminiscent 0:01:41.120 --> 0:01:42.839 of what a lot of people experience in the US. 0:01:42.959 --> 0:01:45.840 And that's kind of just dealing with the failing infrastructure 0:01:45.880 --> 0:01:49.120 problem that you have here in America. UM, I don't 0:01:49.120 --> 0:01:52.000 know if you're familiar with the American Society of Civil Engineers, 0:01:52.000 --> 0:01:55.080 but they gave the U S a D plus um 0:01:55.160 --> 0:01:57.360 when ranking our country's infrastructure. And that's like, you know, 0:01:57.400 --> 0:02:00.600 in an academic scale, So you can't get that much worse. 0:02:01.080 --> 0:02:02.960 You could get an F. You could get an F. 0:02:03.200 --> 0:02:05.000 So we don't have an F we have a D plus. 0:02:05.080 --> 0:02:07.520 Does that even count just passing? Though I don't think 0:02:07.960 --> 0:02:10.880 in some places it doesn't, some it doesn't, Okay, So 0:02:11.280 --> 0:02:15.080 maybe passing depending where we are. And they also estimated 0:02:15.200 --> 0:02:17.680 to bring us to like a current, so I guess, 0:02:17.720 --> 0:02:20.679 like you know, an a perhaps it would take three 0:02:20.760 --> 0:02:25.959 point six trillion dollars by you talked about those numbers, 0:02:25.960 --> 0:02:31.519 and it's probably why Donald Trump's promised to repair UH 0:02:31.680 --> 0:02:35.640 infrastructure in the US resonated with voters. You know, it's 0:02:35.680 --> 0:02:38.440 impossible to know exactly what he's going to do to 0:02:38.560 --> 0:02:41.480 fulfill that promise because so you know, a few different 0:02:41.480 --> 0:02:45.880 proposals have been bandied about. One thing that his nominee 0:02:45.919 --> 0:02:50.160 for Treasury secretary mentioned was doing an infrastructure bank. It's 0:02:50.200 --> 0:02:53.800 actually an idea that the campaign criticized. So we don't 0:02:53.840 --> 0:02:57.960 really know what's going to happen, but UH an infrastructure 0:02:57.960 --> 0:03:01.720 bank is something that our neighbors to the north have 0:03:01.800 --> 0:03:04.680 announced that they wanted to implement, and that that came 0:03:05.320 --> 0:03:08.680 just recently in what they call the fall Economic Statement. 0:03:08.919 --> 0:03:11.359 So to tell us a little bit more about what 0:03:11.440 --> 0:03:15.880 we have in Canada, we have the Canadian Parliamentary Secretary 0:03:15.919 --> 0:03:19.880 to the Federal Minister of Finance, Francois Philippe Champagne. He's 0:03:19.919 --> 0:03:23.000 joining us over the phone. Francois Philippe is a liberal 0:03:23.040 --> 0:03:26.560 politician and he represents the writing of Scott. Please try 0:03:26.600 --> 0:03:31.640 not to laugh at me, Saint Maurice, I was sound 0:03:32.120 --> 0:03:35.360 super about, Oh, you are far too kind. You truly 0:03:35.360 --> 0:03:39.240 are a politician. So France of Philip, thank you so 0:03:39.320 --> 0:03:41.880 much for joining us. It's a pleasure. It's a pleasure 0:03:41.880 --> 0:03:44.680 I was listening to you, and yes, indeed, I mean 0:03:44.760 --> 0:03:48.200 that's the thing you're talking about, you know, public infrastructure 0:03:48.200 --> 0:03:50.960 and public transit in particular. It's a challenge you find 0:03:50.960 --> 0:03:53.320 in the number of capital around the world. And indeed, 0:03:53.360 --> 0:03:56.080 Canada tried to as you were saying in the fall 0:03:56.080 --> 0:03:59.120 autonomic statement, we we set the Canadians how we're going 0:03:59.160 --> 0:04:01.760 to do it, and um you may have seen we're 0:04:01.760 --> 0:04:05.960 going to invest hundred eighty six billion dollar UH in infrastructure. 0:04:06.040 --> 0:04:10.559 So that's an historic amount because we realized that Canadians 0:04:10.600 --> 0:04:13.560 have asked us to to obviously help them and their 0:04:13.600 --> 0:04:16.040 families and grow the economy. So as part of our 0:04:16.040 --> 0:04:19.200 inclusive growth model, within a number of things for Canadians, 0:04:19.200 --> 0:04:23.640 reducing taxes and investing in families. But on the growth side, 0:04:23.640 --> 0:04:26.919 we decided to invest, as you could see, massively infrastructure, 0:04:27.240 --> 0:04:30.039 not only in public transit, but also in green infrastructure, 0:04:30.240 --> 0:04:35.360 in trade corridors, in rural and infrastructure. And I'm quite 0:04:35.400 --> 0:04:37.280 happy to be talking to you about that because I 0:04:37.360 --> 0:04:40.120 think this is going to be transformational for Canada. Well, 0:04:40.160 --> 0:04:41.680 i'm happy that you're here to tell us about it. 0:04:41.760 --> 0:04:44.760 So the United States, obviously, I'm sure you've heard friendship. Um, 0:04:44.839 --> 0:04:49.480 we're like notoriously outdated for our infrastructure. We had nearly 0:04:49.520 --> 0:04:52.560 ten years ago. I think it was the Mississippi River 0:04:52.640 --> 0:04:55.800 bridge clap in Minneapolis that killed thirteen people and injured 0:04:55.800 --> 0:04:58.800 a hundred and thirty four. Um. Here in the Northeast, 0:04:58.839 --> 0:05:01.160 do you have the am truck train that a lot 0:05:01.200 --> 0:05:03.760 of people complain about, especially those who travel from DC 0:05:04.000 --> 0:05:06.520 to New York. Um, Scott, I'm sure you've had to 0:05:06.520 --> 0:05:10.200 deal with that before. Um, the campaign trail, the Guardian 0:05:10.240 --> 0:05:12.680 Airport comes up as the as the Third World country 0:05:12.800 --> 0:05:14.919 esque airport that we have here in New York. But 0:05:15.000 --> 0:05:17.080 you know, we know, we know all about how bad 0:05:17.120 --> 0:05:19.400 the US is, but trans maybe you can give us 0:05:19.480 --> 0:05:21.440 kind of an account of what it's like in Canada, 0:05:21.480 --> 0:05:24.800 what what's the reputation for infrastructure where you are, Well, 0:05:24.920 --> 0:05:28.760 clearly you know what we're finding in some of our cities, 0:05:28.800 --> 0:05:30.839 and you would find the same thing in the United States. 0:05:30.880 --> 0:05:34.480 We realized that the fact that people cannot transit easily 0:05:34.600 --> 0:05:37.320 in city as a social cost and economic costs. So 0:05:37.360 --> 0:05:40.279 that's why as part of the hundred d six billion 0:05:40.320 --> 0:05:43.640 Canadian we said would be investing over twelve years, we 0:05:43.720 --> 0:05:47.159 put aside twenty five point three billion for public transit 0:05:47.240 --> 0:05:49.320 because we realized there's a cost. You know, we want 0:05:49.400 --> 0:05:52.159 people to be able to transit in the city faster, 0:05:52.880 --> 0:05:55.000 That gives them more time with their family, more time 0:05:55.080 --> 0:05:57.479 to start a business, and so there's a social cost, 0:05:57.560 --> 0:06:00.280 economic costs, and we realized that in sort any we 0:06:00.320 --> 0:06:02.960 wanted to act because we we heard that from Canadian 0:06:03.040 --> 0:06:05.920 Then there was the green infrastructure piece. We're putting more 0:06:05.960 --> 0:06:08.680 than twenty two billion in that this is really about 0:06:08.720 --> 0:06:12.040 clean water, clean hair because um, not just in Canada, 0:06:12.080 --> 0:06:14.960 but I think you'd find throughout North America there's probably 0:06:15.000 --> 0:06:18.760 been an under investment in terms of these type of infrastructure, 0:06:18.800 --> 0:06:22.080 and we needed to continue to invest in and make 0:06:22.080 --> 0:06:26.000 sure that people UM in Canada in particularly want to 0:06:26.000 --> 0:06:28.600 see these green infrastructure being built. And then you have 0:06:28.640 --> 0:06:32.279 the social infrastructure, which is really about social housing. Um 0:06:32.320 --> 0:06:34.960 you mavered, We're gonna put around twenty two billion in 0:06:35.040 --> 0:06:38.920 that because this is really something throughout cities but also 0:06:39.040 --> 0:06:43.080 rural communities. Socializing is becoming an issue if you want 0:06:43.080 --> 0:06:45.960 people to be fully engaged in the economy before the 0:06:46.040 --> 0:06:48.239 engage in society, they have to be able to properly 0:06:48.279 --> 0:06:51.880 house themselves. And then the last piece and is really 0:06:51.920 --> 0:06:54.719 about the trade corridor, and that probably would be interesting 0:06:54.760 --> 0:06:56.640 for the US. So we said we point a found 0:06:56.640 --> 0:06:59.040 a ten billion to make sure that our goods can 0:06:59.120 --> 0:07:03.080 transit faster to our ports. Our airports are bridges mainly 0:07:03.200 --> 0:07:06.279 to the United States, in order to facilitate commerce because 0:07:06.760 --> 0:07:09.440 as you know, we don't need to remind people, but 0:07:09.520 --> 0:07:12.360 you know, we have about two billion of trade going 0:07:12.400 --> 0:07:15.320 on every day between Canada and the United States. You 0:07:15.360 --> 0:07:17.200 have about two thirds of the States and the United 0:07:17.240 --> 0:07:20.600 States who have Canada as their major export partners. So 0:07:20.840 --> 0:07:24.000 we want to facilitate commerce. We want to keep building 0:07:24.000 --> 0:07:27.520 on that extremely good relationship we have UM and making 0:07:27.560 --> 0:07:30.080 sure our trade corridors are very efficient and the last 0:07:30.080 --> 0:07:32.200 piece of fade to to the people listening to us 0:07:32.320 --> 0:07:34.400 is we put a fight two billion for our rural 0:07:34.480 --> 0:07:37.960 and northern communities, understanding probably just like in the US, 0:07:38.040 --> 0:07:41.160 that they have very particular need to make sure that 0:07:41.240 --> 0:07:44.560 we cover these people as well with a very specific 0:07:44.600 --> 0:07:47.920 program of investment. Now, now let's let's talk about what 0:07:48.000 --> 0:07:51.480 Kate was saying about. You know, the US infrastructure getting 0:07:51.840 --> 0:07:55.000 a D plus from the Society of Civil Engineers. When 0:07:55.040 --> 0:07:59.920 when you look at the condition of Canada's airports, roads, bridges, 0:08:00.120 --> 0:08:04.280 is water infrastructure things like that, what kind of reading 0:08:04.320 --> 0:08:05.920 would you give it on a scale of one to 0:08:06.040 --> 0:08:08.560 ten when you would say, like ten is in excellent 0:08:08.600 --> 0:08:13.040 condition and one is uh, you know, you're you're falling apart, 0:08:13.280 --> 0:08:16.720 like lookwart here, Well, I would say, you know, just 0:08:16.760 --> 0:08:18.720 like in the US, if you look across the nation, 0:08:18.800 --> 0:08:21.400 I think that the answer could be different depending on 0:08:21.440 --> 0:08:24.200 if you go if you look north, if you look east, west, 0:08:24.360 --> 0:08:26.680 or in the middle of the country. But suffice to 0:08:26.760 --> 0:08:29.320 say that what we've seen in Canada and it may 0:08:29.320 --> 0:08:32.920 be true another we city country. Particularly over the last 0:08:32.960 --> 0:08:35.760 ten years, there's been an under investment not only a 0:08:35.760 --> 0:08:38.480 new bill, but also in maintenance so obviously when we 0:08:38.600 --> 0:08:41.720 entered government UM with the Prime Minister, true though, we 0:08:41.760 --> 0:08:45.560 found ourselves in a situation where we need to invest 0:08:46.080 --> 0:08:49.520 massively in our infrastructure. This is also good for the 0:08:49.559 --> 0:08:52.880 economy because we said to Canadians that we want to 0:08:52.920 --> 0:08:55.200 have inclusive growth, we want to grow the economy, and 0:08:55.240 --> 0:08:58.640 clearly infrastructure investments give the right way to do because 0:08:58.640 --> 0:09:01.520 that touches about every on UM in our country. When 0:09:01.559 --> 0:09:04.560 you look at these different infrastructure you mentioned, everyone's going 0:09:04.640 --> 0:09:07.680 to benefit. And you know, I would say confident nations 0:09:07.720 --> 0:09:10.520 to the invest in their people and in their economy. 0:09:10.880 --> 0:09:13.080 And one of the things that we've announced in the 0:09:13.120 --> 0:09:17.400 Falltonomic statement was one thing we wanted to create and 0:09:17.440 --> 0:09:21.040 we're gonna set up is an infrastructure Bank. The reason 0:09:21.120 --> 0:09:23.280 for that is for us to be able to do 0:09:23.360 --> 0:09:25.840 more and faster. This is going to be one more 0:09:25.840 --> 0:09:29.560 tool in our toolbox because we understand that UM we 0:09:29.600 --> 0:09:33.200 want to attract global investment, global capital UM. I was 0:09:33.240 --> 0:09:36.400 just at the APEX Finance Minister's summit in li Mont, 0:09:36.480 --> 0:09:40.440 Peru recently, and when I was talking about the Canadian 0:09:40.480 --> 0:09:43.760 way in terms of infrastructure investment, you see there's a 0:09:43.800 --> 0:09:47.120 number of nation and global investments that would like to 0:09:47.160 --> 0:09:50.559 invest in countries like Canada where you have stability, predictability, 0:09:50.640 --> 0:09:54.880 rule of law, very stable banking system, and we think 0:09:54.880 --> 0:09:59.079 that the Infrastructure Bank is gonna be allowing us to 0:09:59.120 --> 0:10:01.599 get the leverage we want in order to attract this 0:10:01.720 --> 0:10:05.240 type of global investment to help us build faster and 0:10:05.559 --> 0:10:08.760 more um with the time skill that we've given Canadians 0:10:08.800 --> 0:10:12.240 to deliver. So, first off, Philip, we have a we 0:10:12.280 --> 0:10:14.400 have an ad we're going to break for, but when 0:10:14.440 --> 0:10:17.080 we come back, I want to hear exactly how an 0:10:17.080 --> 0:10:21.320 infrastructure bank works for our those listeners who aren't policy 0:10:21.360 --> 0:10:33.440 wanks like us. Definitely be a pleasure brought to you 0:10:33.480 --> 0:10:36.720 by Bank of America Merrill Lynch. Seeing what others have seen, 0:10:36.800 --> 0:10:39.840 but uncovering what others may not. Global research that helps 0:10:39.840 --> 0:10:44.040 you harness disruption voted top global research from five years running. 0:10:44.400 --> 0:10:56.600 Merrill Lynch, Pierce, Fenner and Smith Incorporated. Welcome back. Okay, So, 0:10:56.679 --> 0:10:59.280 first of Philip, let's take a step back here, how 0:10:59.400 --> 0:11:01.880 exactly use of our listeners. I know how an infrastructure 0:11:01.880 --> 0:11:04.520 bank works. It's actually this tool that they use in 0:11:04.679 --> 0:11:07.480 the world of municipal bonds here in the US. But 0:11:07.640 --> 0:11:10.200 can you help our listeners who aren't perhaps familiar with 0:11:10.280 --> 0:11:13.520 kind of the basics of how an infrastructure bank works. Yeah, 0:11:13.559 --> 0:11:16.240 I mean, let me tell you why we did that 0:11:16.280 --> 0:11:18.800 in Canada. May If you look at traditional funding model, 0:11:18.840 --> 0:11:21.679 if you have a project of five millions in Canada, 0:11:21.760 --> 0:11:24.800 you would normally have fundings which would be wandered federal, 0:11:24.920 --> 0:11:29.160 wandered provincial, and one through municipal. Now with the infrastructure Bank, 0:11:29.200 --> 0:11:31.400 we think we can get the leverage to four to five. 0:11:31.840 --> 0:11:34.200 So with the same five million project, we think we 0:11:34.200 --> 0:11:37.840 can raise private capital to the extent of about four million, 0:11:38.240 --> 0:11:41.040 and then the federal government would put one third, the 0:11:41.120 --> 0:11:43.960 municipal would put one third, and preventional would put one third. 0:11:44.080 --> 0:11:46.360 So what I was thinking is that it allows us 0:11:46.360 --> 0:11:49.240 to do more and faster. So why are we creating 0:11:49.280 --> 0:11:53.000 that first is to obviously attract global investment to help 0:11:53.080 --> 0:11:56.160 us to do more and faster. And the reason why 0:11:56.200 --> 0:11:57.840 you want to have a structure, and like I said, 0:11:58.000 --> 0:12:00.880 other nations you mentioned it a that' um I know 0:12:01.000 --> 0:12:04.319 of the Australian model for example, but for us, it's 0:12:04.360 --> 0:12:08.000 really about making sure that we pull the expertise we 0:12:08.040 --> 0:12:11.120 would have in this country to make sure that we 0:12:11.240 --> 0:12:14.679 have all the experts in one place. Um. The second 0:12:14.720 --> 0:12:17.560 thing is that we can have projects that could be 0:12:17.640 --> 0:12:21.160 finance uh, so that you need to package these projects 0:12:21.200 --> 0:12:24.880 into something that you can attract global investments. And the 0:12:24.960 --> 0:12:26.720 third thing is that you want to have a pipeline 0:12:26.720 --> 0:12:30.000 of projects. So when you have global investors who are 0:12:30.160 --> 0:12:33.920 looking to invest, for example, in Canada infrastructure, typically these 0:12:33.960 --> 0:12:36.200 people would want to see what kind of projects you have, 0:12:36.280 --> 0:12:39.080 what kind of pipeline of projects you have? Are they 0:12:39.200 --> 0:12:43.320 in green infrastructure, are they in public transit? Are they 0:12:43.320 --> 0:12:47.760 in wastewater and water. So by having one structure, you 0:12:47.800 --> 0:12:50.440 actually pull the expertise. You make sure that you have 0:12:50.480 --> 0:12:52.800 bankable projects. You make sure that you have a pipeline 0:12:52.840 --> 0:12:54.680 of projects. So when you want to go to the 0:12:54.679 --> 0:12:59.760 global markets, you have indeed a place where global investor 0:13:00.040 --> 0:13:03.520 and can can call and see what type of investment 0:13:03.559 --> 0:13:05.760 if they want to invest in infrastructure in Canada, where 0:13:05.800 --> 0:13:07.719 they can go. And I think this is going to 0:13:07.800 --> 0:13:10.120 be very successful. I mean again, I was at the 0:13:10.240 --> 0:13:14.240 APEX Finance Ministers summit in Peru just recently and I 0:13:14.280 --> 0:13:17.840 was mentioning a number of projects and um, you know, 0:13:17.880 --> 0:13:20.200 to give you an example, what I mentioned some of 0:13:20.280 --> 0:13:22.920 the projects. Some of the delegation came to see me 0:13:22.960 --> 0:13:25.319 after and say, that's the type of projects we would 0:13:25.360 --> 0:13:27.560 really want to invest. So what are the projects and 0:13:27.960 --> 0:13:31.559 my curiosities peak. Yeah, well, I gave the example in Montreal, 0:13:32.480 --> 0:13:34.760 which is a great city. In Montreal, we're building what 0:13:34.880 --> 0:13:39.320 we call a regional electric train and this is about 0:13:39.360 --> 0:13:42.880 a four to five billion dollar projects in Canada. This 0:13:42.960 --> 0:13:46.400 is very great because we're building another public transit, a 0:13:46.520 --> 0:13:50.040 very green one. And when I mentioned that, obviously that 0:13:50.120 --> 0:13:52.360 sparked a lot of interest. Because you have a number 0:13:52.400 --> 0:13:55.440 of delegations who have sovereign funds or others. We say, 0:13:55.480 --> 0:13:57.760 that's exactly the type of projects we want to invest 0:13:57.840 --> 0:14:02.079 because you have you know, you know that matches their liabilities. 0:14:02.120 --> 0:14:05.000 That those are projects that you can finance over thirty years. 0:14:05.160 --> 0:14:09.480 So very interesting for investors to look at. And can 0:14:09.520 --> 0:14:11.800 I interrupt a second now, let me let me turn 0:14:11.840 --> 0:14:16.920 to a couple criticisms that I've heard of infrastructure banks 0:14:16.920 --> 0:14:21.960 and private financing. One is that what Trump and his 0:14:22.080 --> 0:14:25.360 campaign said throughout the year, which which is that an 0:14:25.360 --> 0:14:28.800 infrastructure bank creates a whole new bureaucracy, creates, you know, 0:14:28.880 --> 0:14:32.760 kind of centralizes decision making. That's one criticism. And then 0:14:32.840 --> 0:14:34.880 kind of from the other side of the political aisle, 0:14:35.240 --> 0:14:37.920 you hear the criticism that you know, in order to 0:14:38.080 --> 0:14:41.000 make private financing work, you need you need a pretty 0:14:41.120 --> 0:14:44.920 significant flow of taxes or user fees, and you know 0:14:44.960 --> 0:14:48.840 that burden either tends to fall on the average folks 0:14:48.960 --> 0:14:52.600 using the infrastructure, or you know the project doesn't get 0:14:52.600 --> 0:14:56.240 financed at all. How do you respond to those two issues? Well, 0:14:56.280 --> 0:14:59.040 the first one, I think by pulling the resources and 0:14:59.080 --> 0:15:02.480 the projects and an agency, I think you get economy 0:15:02.480 --> 0:15:05.160 of scale and and actually for me, I think it's 0:15:05.200 --> 0:15:07.320 a better way to market these projects if you want 0:15:07.360 --> 0:15:10.480 to attract global investments, so that people know who to call, 0:15:10.600 --> 0:15:13.560 who to talk to if they're interested in investing in 0:15:13.640 --> 0:15:18.280 transformational projects. I mean, we're looking about transformational infrastructure projects 0:15:18.280 --> 0:15:20.280 in our nations. I think there's there's a lot of 0:15:20.280 --> 0:15:23.600 benefits of having one place where people can actually look 0:15:23.680 --> 0:15:27.560 for and also for this agency to prepare these projects, 0:15:27.600 --> 0:15:29.960 select these projects, and the best way to make sure 0:15:29.960 --> 0:15:33.680 that we're going to attract these global investments. The other thing, 0:15:33.720 --> 0:15:35.920 with respect to the user fees, I mean, if you 0:15:35.960 --> 0:15:38.480 look at regional light trains, the one that was just 0:15:38.560 --> 0:15:42.840 talking about. I mean, people already pay for using these services, 0:15:42.920 --> 0:15:46.280 so I don't think that you can necessarily, like you said, 0:15:46.320 --> 0:15:49.520 equate that would be higher users fees. I think we 0:15:49.640 --> 0:15:52.520 know that global capital is looking at investments like these 0:15:52.560 --> 0:15:55.440 one with very long returns, and I think that people 0:15:55.440 --> 0:15:58.400 would be um. What I said to Canadians many times, 0:15:58.400 --> 0:16:00.600 and that would apply to the US. Why not put 0:16:00.800 --> 0:16:04.560 our pension money working for Canadians. So Canadian pension money 0:16:04.560 --> 0:16:07.000 working for Canadians. So when people enter the train in 0:16:07.040 --> 0:16:10.560 the morning, they know that they're, for example, in this case, 0:16:10.600 --> 0:16:13.080 their pension has been helping them to build in that 0:16:13.200 --> 0:16:15.760 and when they pay the user fee, they're actually investing 0:16:15.760 --> 0:16:18.760 in their own pension. So there's something you know. When 0:16:18.760 --> 0:16:21.840 we went to the public with that, we really made 0:16:21.880 --> 0:16:24.400 the case that this was something good for people and 0:16:24.480 --> 0:16:28.360 that would benefit everyone, not just the users. But this 0:16:28.440 --> 0:16:30.080 is a good way to reinvest. I mean, we know 0:16:30.160 --> 0:16:33.640 that there's um, there's a fair amount of capital um 0:16:33.760 --> 0:16:36.960 and pension funds around the world. Insurance companies that are 0:16:37.120 --> 0:16:39.880 looking for these types of projects which are going to 0:16:39.960 --> 0:16:42.480 improve our cities, are going to improve our quality of life, 0:16:42.480 --> 0:16:45.520 are going to bring greener infrastructure. And honestly, when you 0:16:45.560 --> 0:16:47.440 say to Canadians, why don't we put your pension on 0:16:47.480 --> 0:16:50.880 money working for you? Now, that's something that people relate 0:16:50.920 --> 0:16:54.080 to and they accept willingly to say that seems to 0:16:54.160 --> 0:16:56.520 be the smart thing to do today. So this has 0:16:56.560 --> 0:16:59.640 been all very positive, but I have to imagine this 0:16:59.680 --> 0:17:02.160 is politics. There's got to have been some negative feedback. 0:17:02.240 --> 0:17:05.879 So what's been some of the criticisms of potentially implementing 0:17:05.920 --> 0:17:09.040 an infrastructure bank in Canada. Well, the main criticism we 0:17:09.160 --> 0:17:12.120 got was, and I would say that, is there there 0:17:12.160 --> 0:17:15.280 not another agency already existing that could be doing that? 0:17:15.400 --> 0:17:19.400 And uh, you know, we had some agency looking at 0:17:19.560 --> 0:17:23.119 p p P projects, but I think that we thought 0:17:23.160 --> 0:17:27.120 that having a different agency to really with a mandate 0:17:27.200 --> 0:17:29.800 to organize these projects and market them is the best 0:17:29.800 --> 0:17:32.200 way to do. I think there's been very few this 0:17:32.359 --> 0:17:35.600 agreement with respected the value and the merit of making 0:17:35.600 --> 0:17:39.359 sure that um uh, we can structure this project to 0:17:39.400 --> 0:17:42.200 attract global investment. I think people don't understand the leverage. 0:17:42.760 --> 0:17:45.959 People don't understand that we need to do more and faster. Uh. 0:17:46.080 --> 0:17:49.840 Some people like you mentioned question the user fees and 0:17:49.880 --> 0:17:52.879 what we've been very transparent about is that this is 0:17:52.920 --> 0:17:55.520 not for all types of project. Like I said, you know, 0:17:55.520 --> 0:17:59.520 we're putting hundred D six billion in infrastructure over over 0:17:59.560 --> 0:18:02.959 twelve years, and we're taking only fifteen billion out of 0:18:02.960 --> 0:18:06.520 this dread a D six in the Infrastructure Bank, and 0:18:06.600 --> 0:18:08.720 we think we can raise another twenty billion on the 0:18:08.760 --> 0:18:11.359 market for the infrastructure bang. So what we're saying to 0:18:11.440 --> 0:18:14.120 people is that clearly there's some type of investment think 0:18:14.119 --> 0:18:17.480 about social infrastructure. I don't necessarily think that we're going 0:18:17.520 --> 0:18:20.359 to find projects that would fit the bill to be 0:18:20.720 --> 0:18:24.560 fundance to the Infrastructure Bank, but by getting the leverage 0:18:24.800 --> 0:18:27.639 with the Infrastructure Bank for those projects that could attract 0:18:27.640 --> 0:18:31.840 global capital, that gives us more money to being able 0:18:31.880 --> 0:18:35.199 to invest in social infrastructure. And when you explain to 0:18:35.240 --> 0:18:37.399 people and you take the time to say this is 0:18:37.440 --> 0:18:41.360 about doing more and faster and actually not using public 0:18:41.440 --> 0:18:45.000 funds that would otherwise be needed to build a type 0:18:45.040 --> 0:18:48.240 of infrastructure where we need we can get private capital, 0:18:48.600 --> 0:18:52.120 but using these funds too, for example, invest in social housing. 0:18:52.760 --> 0:18:55.480 People really understand that this really makes sense. So how 0:18:55.520 --> 0:18:58.800 long until this Infrastructure Bank is up and running, until 0:18:58.840 --> 0:19:02.840 it finances it's for projects? Well as you said. We 0:19:02.840 --> 0:19:05.159 we announced that in the fall coomic statement we have 0:19:05.240 --> 0:19:08.240 in Canada. This is you know, six months after our 0:19:08.240 --> 0:19:12.359 federal budget, so you know, we're about building the blueprints 0:19:12.359 --> 0:19:15.680 of that. We want to obviously get the bank started 0:19:15.720 --> 0:19:19.280 as fast as possible. I think based on our discussions 0:19:19.280 --> 0:19:21.560 with a number of international partners, there's a lot of 0:19:21.600 --> 0:19:25.159 interest in investing in Canada for the reasons we know, 0:19:25.280 --> 0:19:27.840 because people want to invest in North America, people have 0:19:28.560 --> 0:19:32.000 confidence in our system, people will see that these green 0:19:32.040 --> 0:19:35.920 projects are going to attract significant investments. So we're trying 0:19:35.960 --> 0:19:38.760 to set up with you know, a small team to 0:19:38.840 --> 0:19:41.360 start as soon as possible to make sure that we 0:19:41.760 --> 0:19:45.159 can start market these projects around the world and get um, 0:19:45.359 --> 0:19:47.920 these projects built as soon as possible. So let me 0:19:47.960 --> 0:19:50.840 ask you one final question. UM. Like I mentioned before, 0:19:50.880 --> 0:19:54.000 the US does use the infrastructure bank model on a 0:19:54.119 --> 0:19:57.240 smaller scale. UM. The idea of being you know, for 0:19:57.240 --> 0:20:00.520 our listeners who don't know about this, certain dates that 0:20:00.640 --> 0:20:06.600 have small municipalities, UM, they'll use a state level infrastructure 0:20:06.600 --> 0:20:08.359 bank model. And the way it works is that the 0:20:08.440 --> 0:20:11.440 state will borrow money on capital markets using the states 0:20:12.040 --> 0:20:15.000 interest rate UM, which is you know, much lower. Of course, 0:20:15.040 --> 0:20:18.200 than the towns, and then the towns will go to 0:20:18.320 --> 0:20:22.800 the state, you know, saying you know, the infistracture products 0:20:22.840 --> 0:20:25.120 that they want to get done, and the state will 0:20:25.160 --> 0:20:28.840 effectively lend the money to the individual towns. The whole 0:20:28.840 --> 0:20:31.560 purpose being that small towns aren't edged out of the 0:20:31.600 --> 0:20:35.840 capital markets, you know, by either just no investor being 0:20:35.920 --> 0:20:39.480 interested or having to pay you know, prohibitively high interest rates. 0:20:39.880 --> 0:20:42.720 And the long way of asking you, um, is there 0:20:42.720 --> 0:20:44.680 a reason why you didn't look at look at maybe 0:20:44.720 --> 0:20:48.160 perhaps doing this on a province by province basis as 0:20:48.200 --> 0:20:51.800 opposed to federal Well, I mean it's interesting you mentioned 0:20:51.840 --> 0:20:54.800 states because I'm a bit familiar with the Alaskan model. 0:20:54.920 --> 0:20:57.480 I think in Alaska there's something similar to that which 0:20:57.520 --> 0:21:00.960 I'm familiar because I think I've met with people, Uh 0:21:01.119 --> 0:21:03.439 we're saying the great things you've been able to achieve 0:21:03.440 --> 0:21:06.680 in Alaska, which respected that in terms of infrastructure development. 0:21:06.960 --> 0:21:09.600 So clearly, like you said, there's different models and more 0:21:09.720 --> 0:21:13.439 of it with the Alaska example. But I think for us, 0:21:13.800 --> 0:21:18.720 because we're looking at transformational national type of projects, we 0:21:18.800 --> 0:21:20.840 thought that this is the best way to to get 0:21:20.880 --> 0:21:23.199 the best leverage was really to have that at the 0:21:23.200 --> 0:21:27.480 federal level. UM, we want to make sure that we 0:21:27.560 --> 0:21:32.119 attract some of the best talent in this agency. We 0:21:32.160 --> 0:21:34.760 want to make sure that we structure these projects to 0:21:34.880 --> 0:21:37.800 be bankable, and I think to do that on a 0:21:37.880 --> 0:21:40.520 national basis. Obviously it could be different in the United 0:21:40.520 --> 0:21:43.600 States because obviously our economy or different size, but we 0:21:43.760 --> 0:21:46.320