
Elon Musk is gone and tariffs are illegal, but it's no time to declare Trump defeated
Elon Musk is leaving the White House and a court has ruled a tranche of American trade tariffs to be illegal.
They are two welcome developments, but it's too soon to celebrate that the most offensive elements of Donald Trump's presidency are going … going … gone.
The U.S. Commander-in-Chief has shown no signs that he is prepared to fall back into a slow-and-steady pace of government that benefits all and favours none.
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No sign either that he is willing to follow any judge's orders.
Opening the White House doors to Musk, the SpaceX and Tesla chief, was only one of the first instances of Trump's enthusiasm for blurring the lines between the spheres of public service and private enterprise.
And though the social-media titan has admitted in an interview with tech publication Ars Technica that 'I probably did spend a bit too much time on politics' the giant wrecking ball he set in motion with the President's blessing will not be soon or easily stopped.
Likewise, Trump's tariffs. They have roiled markets, cut the legs out from long-standing trade relationships and transformed Washington into a near-permanent episode of Let's Make a Deal.
Politics
Mark Carney 'welcomes' U.S. court decision that rules Trump's tariffs are 'unjustified'
Tonda MacCharles
They have resulted in a frightening and sometimes farcical state-of-affairs that carries the risk of recession or economic ruin for U.S.-dependent countries.
That's why Wednesday's court ruling that two groups of the trade duties were illegal has received a global welcome, though not yet a sense of complete relief.
The U.S. Court of International Trade ruled that Trump's fentanyl-and-migrant tariffs against Canada, Mexico and China violated the law because 'they do not deal with the threats' outlined in the president's executive orders.
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The court also ruled that separate 'retaliatory' tariffs against a swath of nations, from Australia to India to Madagascar to Vietnam, 'exceed(ed) any authority granted to the president … to regulate importation by means of tariffs.'
The court ruled that this authority, under the law, falls to the U.S. Congress, not the president. Other tariffs on foreign steel, aluminum and cars imports remain in place.
The White House response was unflinching: 'It is not for unelected judges to decide how to properly address a national emergency,' a Trump spokesperson said, adding that the President would use 'every lever of executive power' at his disposal.
That puts another wrecking ball in motion — this one on a collision course with the courts.
It will probably only be decided by the Republican-majority justices of the Supreme Court, who have shown some signs of willingness to put up roadblocks for an administration keen on pushing the bounds of presidential powers.
But there are even doubts about Trump's willingness to follow orders from the country's highest court.
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Last month, the administration was ordered to facilitate the return of Kilmar Abrego Garcia, a Salvadoran citizen mistakenly deported back to his home country despite an order that he should be protected from threats made by gang members against his family.
Abrego Garcia remains in custody, with Trump maintaining that he is a dangerous member of a gang himself, the MS-13, which has been designated as a terrorist organization.
So, it is no time for Trump's exhausted and exasperated opposition to take a breather or a victory lap, though there will be temptations.
The ambitions of Musk, the intergalactic entrepreneur, were sky high. His accomplishments at the head of the Department of Government Efficiency after 130 days, however, were distinctly terrestrial.
A promised US$2 trillion in spending cuts was quickly halved and then halved again. The most recent estimates, posted to the department's website, claim savings of US$175 billion.
In that short time, he effectively dismantled USAID, the government's main foreign assistance program, ended programs, and positions and contracts that promoted Diversity, Equity and Inclusion policies. His office has also broken faith with public-sector workers.
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The most glaring example of Musk's tactless approach was a now-famous February email demanding that bureaucrats outline 'what they got done last week.'
'Failure to respond will be taken as a resignation,' he wrote in an explanatory note on X.
His approach to the public service may have side-swiped the reputation and stock price of his beloved car company, but it also opened a breach in the wall between the realms of public and private interests.
Is it appropriate that a public servant — even if he is the richest man in the world — wear Tesla merchandise to government meetings, as he did the other day when meeting with Tulsi Gabbard, Trump's Director of National Intelligence?
Or for Trump and Musk to host a March photo op that turned the White House driveway into a temporary Tesla dealership?
Whether it's labelled a conflict of interest or corruption, it's a break with something sacred. And it continues.
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Trump drafts cryptocurrency-friendly government policies while, at the same time, pumping the value of his official meme coin. Introduced just a few days before Trump was sworn in for his second term, he promoted it earlier this month by offering crypto investors a meet-the-president dinner that was billed as 'the most exclusive invitation in the world.'
It's now the subject of congressional inquiry, described by Democratic Sen. Richard Blumenthal as 'unprecedented, pay-to-play scheme to provide access to the Presidency to the highest bidder.'
The shiny crypto coin reflects the ego of a man for whom the professional and the political has always been personal.
It started with his family name on branded buildings and golf courses. It continues with his fat-marker signature scrawled at the bottom of presidential executive orders.
But those edicts are at risk of turning a presidential administration into an all-powerful imperial court.
One that takes inspiration from the phrase attributed to Louis XIV, the Sun King, who believed that the laws in 17th century France were whatever he wanted them and declared them to be.
'l'État c'est moi,' he reputedly told French parliamentarians who dared challenge his will. 'I am the state.'
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Globe and Mail
29 minutes ago
- Globe and Mail
Stock Indexes Rebound on Strength in Chip Makers and Energy Stocks
The S&P 500 Index ($SPX) (SPY) Monday closed up +0.41%, the Dow Jones Industrials Index ($DOWI) (DIA) closed up +0.08%, and the Nasdaq 100 Index ($IUXX) (QQQ) closed up +0.71%. June E-mini S&P futures (ESM25) are up +0.60%, and June E-mini Nasdaq futures (NQM25) are up +0.80%. Stock indexes on Monday recovered from early losses and settled higher. Strength in chip stocks led the broader market higher on Monday. Also, energy producers rallied after the price of WTI crude rose more than +2% to a 1-1/2 week high. In addition, US steel and aluminum producers soared Monday after President Trump pledged to double tariffs on US steel and aluminum imports to 50% from 25%. Stocks on Monday initially moved lower due to an escalation of trade tensions between the US and China. On Monday, China's Ministry of Commerce accused the US of unilaterally introducing new discriminatory restrictions, including new guidelines on AI chip export controls, curbs on chip design software sales to China, and the revocation of Chinese student visas, and vowed to take measures to defend its interests. The latest flare-up threatens to worsen trade relations even after President Trump expressed hope he will speak with Chinese President Xi Jinping this week to accelerate a trade truce. Economic concerns were also bearish for stocks after Monday's news showed US manufacturing activity last month unexpectedly contracted by the most in 6 months, and April construction spending unexpectedly declined. In addition, higher bond yields on Monday were bearish for stocks. The 10-year T-note yield Monday rose +6 bp to 4.46% as escalating trade tensions between the US and China led to a broad selloff of dollar assets, including Treasuries. Also, Monday's 2% jump in the price of WTI crude to a 1-1/2 week high has boosted inflation expectations, a hawkish factor for Fed policy. The US May ISM manufacturing index unexpectedly fell -0.2 to 48.5, weaker than expectations of an increase to 49.5 and the steepest pace of expansion in 6 months. US Apr construction spending unexpectedly fell -0.4% m/m, weaker than expectations of a +0.2% m/m increase. Fed comments on Monday were mostly supportive of stocks and bonds. Fed Governor Waller said, "Assuming that the effective tariff rate settles close to my lower tariff scenario, that underlying inflation continues to make progress to our 2% goal, and that the labor market remains solid, I would be supporting good news rate cuts later this year." Also, Chicago Fed President Goolsbee said the Fed can proceed with interest rate cuts if uncertainty around trade policy is resolved. On the negative side, Dallas Fed President Logan said the Fed can afford to be patient before acting on interest rates as "both sides of our dual mandate appear fairly balanced." The markets are discounting the chances at 5% for a -25 bp rate cut at the next FOMC meeting on June 17-18. The markets this week will focus on any new trade or tariff news. On Tuesday, Apr factory orders are expected to fall -3.2% m/m and the Apr JOLTS job openings report is expected to fall by -92,000 to 7.100 million. On Wednesday, the May ADP employment change is expected to climb by +110,000, and the May ISM services index is expected to rise +0.5 to 52.1. On Thursday, weekly initial unemployment claims are expected to fall by -5,000 to 235,000. On Friday, May nonfarm payrolls are expected to climb +125,000, and the May unemployment rate is expected to remain unchanged at 4.2%. Finally, May average hourly earnings are expected to rise +0.3% m/m and +3.7% y/y. Overseas stock markets on Monday settled lower. The Euro Stoxx 50 fell to a 1-week low and closed down -0.21%. China's Shanghai Composite was closed today for the Dragon Boat Day holiday. Japan's Nikkei Stock 225 closed down -1.30%. Interest Rates September 10-year T-notes (ZNU2 5) Monday closed down -9 ticks. The 10-year T-note yield rose +6.2 bp to 4.462%. Sep T-notes on Monday were under pressure as escalating trade tensions between the US and China have led to a broad selloff of dollar assets, including Treasuries. Also, a negative carryover from weakness in European government bonds weighing on T-notes. In addition, today's 2% jump in the price of WTI crude to a 1-1/2 week high has boosted inflation expectations, a bearish factor for T-notes. Losses in T-notes were limited due to dovish Fed comments after Fed Governor Waller laid out a scenario for the Fed to cut interest rates later this year, and Chicago Fed President Goolsbee said the Fed could proceed with interest rate cuts if uncertainty around trade policy is resolved. In addition, Monday's weaker-than-expected reports on May ISM manufacturing activity and Apr construction spending were bullish for T-notes. European government bond yields on Monday finished higher. The 10-year German bund yield rose +2.4 bp to 2.524%. The 10-year UK gilt yield rose +2.1 bp to 4.667%. The German May S&P manufacturing PMI was revised downward by -0.5 to 48.3 from the previously reported 48.8. The UK May S&P manufacturing PMI was revised upward by 1.3 to 46.4 from the previously reported 45.1. Swaps are discounting the chances at 98% for a -25 bp rate cut by the ECB at Thursday's policy meeting. US Stock Movers Chip stocks moved higher Monday to lend support to the overall market. Micron Technology (MU) closed up more than +4%, and Advanced Micro Devices (AMD) and Microchip Technology (MCHP) closed up more than +3%. Also, Broadcom (AVGO) and Marvel Technology (MRVL) closed up more than +2%. In addition, Nvidia (NVDA), Lam Research (LRCX), ARM Holdings Plc (ARM), and ASML Holding NV (ASML) closed up more than +1%. US steel and aluminum producers rallied Monday after President Trump said he would increase tariffs on US steel and aluminum imports to 50% from 25%. Cleveland-Cliffs (CLF) and Century Aluminum (CENX) closed up more than +20%. Also, Steel Dynamics (STLD) closed up more than +10% to lead gainers in the S&P 500. In addition, Nucor (NUE) closed up more than +10%, and Commercial Metals (CMC) closed up more than +5%. Energy producers and energy service providers moved higher on Monday as the price of WTI crude climbed more than +2% to a 1-1/2 week high. Devon Energy (DVN), Diamondback Energy (FANG), and Haliburton (HAL) closed up more than +2%. Also, APA Corp (APA), ConocoPhillips (COP), Hess Corp (HES), and Occidental Petroleum (OXY) are up more than +1%. Gold mining stocks rose Monday after the price of gold soared more than +2% to a 3-week high. Gold Fields Ltd (GFI) closed up more than +9%, and Anglogold Ashanti Plc (AU) closed up more than +7%. Also, Newmont (NEM) closed up more than +5%, and Freeport McMoRan (FCX) closed up more than +4%. Zscaler (ZS) closed up more than +6% to lead gainers in the Nasdaq 100 after UBS raised its price target on the stock to $315 from $260. Moderna (MRNA) closed up more than +1% after the FDA approved the company's new Covid vaccine for adults over 65 and anyone over 12 with at least one risk factor for severe disease. Vera Therapeutics (VERA) closed up more than +66% after reporting the primary endpoint was met in a Phase 3 trial of its atacicept for the treatment of immunoglobulin A nephropathy. Technology companies with the US government as a major client moved lower on Monday after The Wall Street Journal reported that funding cuts by the Trump administration have spread to technology contractors. As a result, Leidos Holdings (LDOS) closed down more than -4%, and CDW Corp (CDW) closed down more than -3% to lead losers in the Nasdaq 100. Also, Adobe (ADBE) and Dell Technologies (DELL) closed down more than -2%. Automakers retreated Monday as President Trump's pledge to boost tariffs on US steel and aluminum imports to 50% from 25% threatens to cut into the companies' profits. Stellantis NV (STLA), General Motors (GM), and Ford Motor (F) closed down more than -3%. Science Applications International (SAIC) closed down more than -13% after reporting Q1 EPS of $1.92, weaker than the consensus of $2.13. Centene (CNC) closed down more than -3% after Barclays downgraded the stock to equal weight from overweight, citing concern about Medicare Part D and individual Affordable Care Act businesses. Tesla (TSLA) closed down more than -1% after Tesla May new-vehicle registrations in France fell -57% y/y to an almost 3-year low. JB Hunt Transport Services (JBHT) closed down more than -1% after Goldman Sach downgraded the stock to neutral from buy. Crowdstrike Holdings Inc (CRWD), Dollar General Corp (DG), Donaldson Co Inc (DCI), Ferguson Enterprises Inc (FERG), Guidewire Software Inc (GWRE), Hewlett Packard Enterprise Co (HPE), Ollie's Bargain Outlet Holding (OLLI).


Winnipeg Free Press
4 hours ago
- Winnipeg Free Press
‘Hard to look at the bright side'
Lost sales, higher prices and material shortages have recently hit Manitoba businesses reliant on steel and aluminum — and it could get worse. U.S. President Donald Trump announced last week he'd raise tariffs on steel and aluminum imports to 50 per cent, a doubling of the current levy. As of Monday afternoon, the change is proposed to begin Wednesday. Current tariffs already have a 'deep and profound' impact across the supply chain, said Catherine Cobden, president of the Canadian Steel Producers Association. MIKE DEAL / FREE PRESS Steel in various forms wait to be shipped to customers. Premier Wab Kinew and Selkirk Mayor Larry Johannson speak flanked by employees and in front of a giant Canadian flag hanging in one of the buildings at the Gerdau Manitoba Steel Mill, 27 Main St., Selkirk, Thursday morning. Reporter: Gabrielle Piche 250327 - Thursday, March 27, 2025. Gerdau SA's Selkirk steel plant is a CSPA member. A majority of the company's steel is exported to the United States; it employs upwards of 500 Manitobans. Gerdau previously directed a reporter to the CSPA for comment. Across Canada, steel shipments to the United States dropped roughly 30 per cent in April, Cobden said. Twenty-five per cent tariffs came into effect in March. 'This will close the market for Canadian exports to the United States,' Cobden said of the prospect of a 50 per cent levy. Selkirk Mayor Larry Johansson considers himself an 'optimistic kind of mayor.' '(But) it's hard to look at the bright side when they raise the tariffs another 25 per cent,' he said. For now, he's clocked activity in Gerdau's lot — plenty of semi-trucks. Gerdau employees haven't been laid off to date, the United Steelworkers confirmed. A 50 per cent tariff would be a 'massive challenge' to Gerdau and similar mills, said Scott Lunny, a United Steelworkers director. 'Who pays the price for that, often, is workers.' 'There's customers I supply in the U.S. that, when he does things like this, they just stop buying and wait six weeks.'– Richard Bobrowski, Imperial Steel owner Meantime, Imperial Steel hasn't laid off staff, despite recording a 25 per cent drop in sales year-over-year. The Winnipeg company, which makes thin-wall steel tubing, exported roughly 70 per cent of its products to the U.S. in 2024. 'You get going for a few weeks, and all of a sudden the president of the United States makes a statement,' said Richard Bobrowski, Imperial Steel owner. 'There's customers I supply in the U.S. that, when he does things like this, they just stop buying and wait six weeks.' American clients are sourcing within their home country more, Bobrowski added. Imperial Steel struggles to give consistent pricing — between tariff changes and recent steel price fluctuations — and U.S. customers are hesitant to sign on, wondering what change could occur before a shipment arrives. Imperial Steel currently splits the 25 per cent import tariff with its American patrons. It made a decision Monday: it won't swallow more than 12.5 per cent of a 50 per cent tariff. 'Which will then stress our company's ability to compete,' Bobrowski said. 'That's when the government has got to get involved.' The Manitoba government tabbed $300 million for tariff-impacted businesses and farmers in its Budget 2025 contingency plan. The funding hasn't yet been used. Evolution Wheel has avoided tariffs on both sides of the border, said owner Derek Hird. The Winnipeg-based construction-grade solid tire maker imports steel from the United States; it's exempt from Canada's reciprocal tariffs because of a carve-out for manufacturers. The company mainly ships south of the border. But the turnaround time has lengthened — Evolution Wheel hasn't been able to source the specific steel it needs. 'Companies … are just buying up huge amounts of stock, and there's no supply,' Hird said. 'You're … fighting for scraps on what's available in the market right now.' 'Companies … are just buying up huge amounts of stock, and there's no supply,' Hird said. 'You're … fighting for scraps on what's available in the market right now.'– Evolution Wheel owner Derek Hird Supply chain issues have resulted in lost sales, Hird added. Meantime, he's paying more for the steel he purchases. So, too, is Northern Steel Buildings, a steel shop enterprise in Morden. It gets steel from Canada and the United States, and it pays Canada's 25 per cent reciprocal tariff. The tariffed products can be cheaper than Canadian steel, said general manager Rick Friesen. That won't be the case if a 50 per cent fee comes online on Canada's side. 'If the Canadian government decides to retaliate … I think that will hinder the Canadian economy and growth,' Friesen said. The economic uncertainty is damaging, said Chuck Davidson, president of the Manitoba Chambers of Commerce. 'We continue to … move the goalposts at the whim of the (U.S.) president.' If businesses feel further tariff effects, government assistance could be needed, he added. The Canadian Steel Producers Association is calling for Ottawa to implement tariffs to incentivize domestic steel use. Local producers compete with unfairly traded international steel that retails cheaper, Cobden asserted. Manitoba is among the jurisdictions pledging to use more Canadian steel. In March, Premier Wab Kinew declared government infrastructure projects requiring steel would source Canadian. These announcements are appreciated, Cobden said, but the projects might be too late to mitigate the damage of a 50 per cent tariff. 'If the Canadian government decides to retaliate … I think that will hinder the Canadian economy and growth.'– Northern Steel Buildings general manager Rick Friesen However such a levy isn't a given, said Gary Mar, Canada West Foundation president. 'I think the best idea is to … wait and see what the president actually does first.' Monday Mornings The latest local business news and a lookahead to the coming week. He believes Americans will push back against tariffs as they feel pain in their pocketbooks. The impact hasn't reached its peak, Mar stated, noting hundreds of U.S. politicians will run for office again next year. Meantime, Manitoba companies are attempting to dodge tariffs. Northern Steel Buildings is consulting agencies about a reciprocal tariff exemption. It's heard of other companies being successful, Friesen said. Eascan Automation in Winnipeg, which creates robots, is tapping Canadian companies to bulk order aluminum goods from Europe for direct shipment into Canada. The goal is tricky because Eascan orders custom parts and its supplier distribution centres are in the United States, said chief executive Camila Bellon. Canada exported $20 billion worth of steel and iron to the U.S. last year and $4.1 billion in aluminum, per Natural Resources Canada data. Gabrielle PichéReporter Gabrielle Piché reports on business for the Free Press. She interned at the Free Press and worked for its sister outlet, Canstar Community News, before entering the business beat in 2021. Read more about Gabrielle. Every piece of reporting Gabrielle produces is reviewed by an editing team before it is posted online or published in print — part of the Free Press's tradition, since 1872, of producing reliable independent journalism. Read more about Free Press's history and mandate, and learn how our newsroom operates. Our newsroom depends on a growing audience of readers to power our journalism. If you are not a paid reader, please consider becoming a subscriber. Our newsroom depends on its audience of readers to power our journalism. Thank you for your support.


Canada Standard
4 hours ago
- Canada Standard
What are Canada's governing Liberals going to do about AI?
Fresh off his election victory, Prime Minister Mark Carney has been focused on standing up to Donald Trump's claims on Canada as the 51st state and American tariffs. But while that political drama unfolds, one topic that seems to have quietly slipped under the radar is the rise of artificial intelligence. Despite its transformative impact on everything from jobs to national security, AI received surprisingly little attention during the campaign and in the first weeks following Carney's victory. The consequences of that lack of attention are already starting to show, as emissions and electricity costs continue unabated without a clear vision of where AI fits in. Read more: Anxious over AI? One way to cope is by building your uniquely human skills Although Carney has appointed former journalist Evan Solomon as Canada's first-ever AI minister, it's not yet clear what action the Liberal government plans to take on AI. The Liberals' "Canada Strong" plan outlining the prime minister's proposals is scarce on details. Still, it provides some clues on how the Liberals see AI and what they believe it offers to the Canadian economy - and also what they seem to have misunderstood. First, the plan includes some robust initiatives for improving Canada's digital infrastructure, which lags behind other leading countries, especially in terms of rural broadband and reliable cell service. To accomplish these goals, the Liberals say they'll incentivize investment by "introducing flow-through shares to our Canadian startup raise money faster" for AI and other technologies. In other words, they will reuse the model of mining and oil companies whereby investors can claim a tax deduction for the same amount as their investment. A major question is whether Canada's investment ecosystem has enough big players willing to take these risks. The plan gets less promising as it comes to the implementation of AI within "the economy of tomorrow." The Liberals say they plan to build more data centres, improve computing capacity and create digital supply chain solutions "to improve efficiency and reduce costs for Canadians." All that that sounds OK - so far. But how will they do this? The Liberals plan to establish the Bureau of Research, Engineering and Advanced Leadership in Science (BOREALIS), linking AI development directly to the Canadian Armed Forces and the Communications Security Establishment Canada, which provides the federal government with information technology security and foreign signals intelligence. This approach to AI is focused on what it offers to Canada's defence, whether by manufacturing semiconductors or improving intelligence gathering, so that it can rely less on the U.S. Similarly, Canadian defence tech firms will access funding to help reduce dependence on American suppliers and networks. The Liberals are pledging sovereignty and autonomy for Canada's defence and security, all enabled by "the construction and development of AI infrastructure." What goes unsaid is the intense power needs of data centres, and the consequences for emissions and climate action of "building the next generation of data centres" in Canada. New data centres cannot be built without also constructing more renewable energy infrastructure, and none of this addresses emissions or climate change. If the centres crop up in big numbers as planned, Canadians could also see their electricity costs go up or become less reliable. That's because finding space within the existing grid is not as easy as it may sound when AI data centres require over 100 megawatts (MW) of electricity demand versus five to 10 MW for a regular centre. With the rapidly evolving market for AI-based data centres, Canadian policymakers need to provide clear guidance to utilities in terms of their current decisions on competing industrial-scale demands. As the Canadian Climate Institute points out: "Anything less risks higher rates, increased emissions, missed economic opportunities - or all of the above." So far, the Liberal plan fails to address any of these concerns. What else does the "economy of tomorrow" hold? Apparently, it means more efficient government. According to the Liberal plan, AI "is how government improves service delivery, it is how government keeps up with the speed of business, and it is how government maximizes efficiency and reduces cost." Despite otherwise clashing with the Trump administration, this language is reminiscent of Elon Musk's Department of Government Efficiency (DOGE), which has also centred its use of AI. Read more: DOGE's AI surveillance risks silencing whistleblowers and weakening democracy The Liberals will open an Office of Digital Transformation, which aims to get rid of red tape and "reduce barriers for businesses to operate in Canada." They don't seem to really know what this would actually look like, however. They say: "This could mean using AI to address government service backlogs and improve service delivery times, so that Canadians get better services, faster." Their fiscal plan points out that this frame of thinking applies to every single expenditure: "We will look at every new dollar being spent through the lens of how AI and technology can improve service and reduce costs." The economy will also benefit, the government argues, from AI commercialization, with $46 million pegged over the next four years to connect AI researchers with businesses. This would work alongside a tax credit for small and medium-sized businesses to "leverage AI to boost their bottom lines, create jobs, and support existing employees." But a new report by Orgvue, the organizational design and planning software platform, shows that over half of businesses that rushed to impose AI just ended up making their employees redundant without clear gains in productivity. Creating a tax credit for smaller companies to introduce AI seems like a recipe for repeating the same mistake. Much of the Liberal plan seems to involve taking risks. There's a shortsightedness on this rapidly advancing technology that requires significant guardrails. The government seem to view AI as a solutions machine, buying into the hype around it without taking the time to understand it. As policy is properly hashed out in the weeks and months to come, the Liberals' feet will have to be held to the fire on the issue of AI. Canadians must benefit from its limited uses and be protected from its abuses.