Wynne takes hard line against ‘Buy American’

Liberals will present bill to fight back against protectionist states

Ontario needs a new law letting the government retaliate against American states that keep companies here from bidding on their public contracts, Premier Kathleen Wynne said Wednesday.

New York will be the first target, she said — a state where Ontario fought off wide-reaching “Buy American” restrictions last year, but where a more limited law saying contractors have to use only American iron and steel in state-funded road and bridge projects takes effect in April.

“I have consistently said that Ontario wants free and fair trade. That’s what creates the greatest number of opportunities for our people,” Wynne said, via a written statement. “New York state’s Buy American law will undermine the spirit of our partnership and give their workers an unfair edge. I have no choice but to respond by introducing legislation of our own. Our U.S. partners need to know that if they choose protectionism, they will pay a price.”

The legislature isn’t sitting now but Wynne said when MPPs return to Queen’s Park in a couple of weeks, the Liberals will present them with a bill giving the government broad authority to answer rules like New York’s with equivalent ones covering Ontario’s public spending. If New York state road projects can’t use steel from Hamilton, Ontario would find something its contractors couldn’t buy from New York producers.

Texas has a similar new rule on iron and steel, and would likely be Ontario’s second target.

Ironically, Wynne announced all this on her most recent goodwill tour to the U.S., which made stops in Washington D.C. and New York City. Her Tuesday in Washington was packed with meetings, including with U.S. trade diplomats, senators from Wisconsin and Michigan, and Vice-President Mike Pence’s chief policy adviser; Wednesday in New York was more about sales pitches to business groups, including a roundtable on the North American Free Trade Agreement.

Wynne has made a mission out of combating President Donald Trump’s anti-trade ethos by making friends with state governors and legislators, hoping that when Trump gets protectionist, they’ll speak up for the importance of free trade to their states. NAFTA has closely integrated the economies of Ontario and border states; raw materials and industrial goods flow back and forth across the Canada-U.S. border to the tune of billions of dollars a year, often between factories and warehouses owned by the same companies.

A harder, thicker border is bad for business, but that’s a pitch that has a better chance of sticking in the White House if Trump hears it from the Republican governors of swing states like Michigan and Wisconsin instead of a liberal lady politician from Ontario.

So far, it’s worked OK. Ontario’s blandishments did get that sweeping Buy American language out of New York’s budget bill. NAFTA is being renegotiated, not (yet) ripped up. It’s still a defensive action.

The strict pro-trade argument is that we shouldn’t care what other governments do and ours should get the best deal possible when it buys stuff, period. If, as a politician, you don’t mind looking like a pushover — “Why won’t Kathleen Wynne stand up for Ontario workers?” the opposition would say.

There’s always political capital to be made from trying to unite people against a common foreign enemy. Alberta Premier Rachel Notley is doing it against British Columbia right now, banning imports of B.C. wine to retaliate against Premier John Horgan’s talk (and it is just talk, so far) of restricting the transportation of Alberta oil through his province. Both Notley and Horgan are playing to what their own voters want, even if the results are harmful to everyone. Conflict can be addictive.

“Initiating a trade war with the United States is a last-ditch election ploy by Kathleen Wynne to deflect the blame for her disastrous economic policies,” responded interim Progressive Conservative leader Vic Fedeli, in a written statement of his own.

“As the mayor of North Bay,” he added, “I successfully led the charge against Buy American policies with a mayor to mayor plea. But, the premier using this as a political tool to cling to power is nothing short of reckless, especially during this critical time in the NAFTA negotiations.”

Fedeli did, in 2009, reach out to mayors in some U.S. cities where North Bay had bought fire trucks and other civic equipment, asking them to resist a federal plan to have billions in recessionfighting infrastructure work use only material bought in America (saying he “led the charge” in what was a national-level argument that Canada ultimately won is a bit much, but he did do

Having a stick helps. Otherwise you’re not bargaining, you’re begging.

something). Even in those letters he noted what a shame it would be if North Bay had rules forbidding it to buy from U.S. suppliers.

When nicey-nice fails, having a stick helps. Otherwise you’re not bargaining, you’re begging.