Look beyond Trump’s huffing and puffing
U.S. president’s rhetoric isn’t reflected in modest NAFTA objectives
I don’t know how most of our U.S. neighbours celebrated Made in America Day, but Donald Trump sure knew how to party.
He sat with boyish glee in a big red fire truck. He tried on a cowboy hat. He swung a baseball bat.
Then he launched into full bluster and bravado when it came to trade.
“No longer are we going to allow other countries to break the rules, steal our jobs and drain our wealth,” Trump said. “And it has been drained. It has been drained.”
He claimed that millions of American jobs have been lost to unfair trade, but he told American manufacturers that when they see what he is going to do about it over the next six months, they are going to be so happy.
And then his trade representative, Robert Lighthizer, released his 18-page list of priorities for coming NAFTA negotiations, and there was none of that lightning and thunder. Reaction from Ottawa and Canadian trade experts was a polite smile and a readiness to get to the table.
Prime Minister Justin Trudeau had already laid out Ottawa’s low-key resolve in his pre-NAFTA speech to U.S. governors in Rhode Island: “While you, my American friends, may be an elephant, Canada is no mouse. More like a moose. Strong and peaceable, but still massively outweighed. So we have to work harder to make our points.”
When formal NAFTA talks begin next month, Canadians, Americans and Mexicans will largely tune out until there is drama. And, make no mistake, any negotiations involving Trump will inevitably include drama.
But such theatre is expected. It is the natural outgrowth of politics, like a strike or lockout threat during labour negotiations or Simon Reisman, Canada’s chief negotiator, angrily stomping out of the original CanadaU.S. free trade talks to successfully move them forward.
But there is nothing in the U.S. outline that is going to somehow restore those “millions” of jobs Trump claims the U.S. has lost due to trade deals, nothing that would magically reverse the flow of American wealth he claims is being drained.
This tough talk on trade is for Trump’s base. Canadian negotiators will know he will have to trumpet some win in the new deal, and they will graciously clear his parade route as Ottawa holds firm on contentious points.
Should Canadians be wary of a U.S. bid to eliminate a dispute resolution mechanism in this deal?
Perhaps, but anyone who has negotiated a labour deal would be familiar with a company demand to eliminate something a union would never relinquish, hoping it will agree to other trade-offs to protect a bottom line. Neither Canada nor Mexico will give up a dispute resolution mechanism of some type.
Trudeau, his cabinet and many of the provincial premiers have played this pre-negotiation period perfectly, going directly to governors, the Congress and state legislatures, while respecting Trump’s team.
They have relentlessly reminded their American counterparts that nine million U.S. workers are dependent on trade for their livelihoods, that two-thirds of U.S. states list Canada as their largest export market.
And as Trudeau said last Friday, preferential access in government procurement, another U.S. proposal released Monday, hurts working class families and can begin a race to the bottom in a futile game of tit-for-tat.
Lobbying subnational governments is not a new strategy, yet it receives more attention this time because of the presence of Trump.
But, although Trudeau has been at great pains to reject any claim that the Canadian “strategy” is to go around Trump, the trade agenda will be driven by the U.S. Congress, not the president.
It is also a Congress which can read poll numbers — one this week showed Trump with a 55-per-cent disapproval rating — with the U.S. mid-terms just over the next hill.
As Carlo Dade, director of the Trade and Investment Centre at the Canada West Foundation, put it: “Congress has a very active role here. Trump can’t run and hide on this. He can try his ‘I’m Donald Trump, this is what I negotiated and you’re going to sign this.’ But it won’t work because this Congress does not trust this president on foreign policy.”
So the question of trade tweak or teardown has been answered. This trends strongly to tweak.
Trump may huff and he may puff, but in this case no one is blowing down the Canadian house. Politicians here who refused to rise to the presidential bait must remain vigilant, but they have already scored a partial victory.
With Vice President Mike Pence looking on, President Donald Trump takes a seat in a fire truck from Pierce Manufacturing during a Made In America product showcase event at the White House this week.