Canada knuckles under to Trump bullying
The moral of the story: bullies win. Often. Canada has little to show for its negotiation of a new trade pact with the United States and Mexico. And when U.S. President Donald Trump says his biggest concession was “making the deal” at all, you know you’ve been mugged.
The agreement late Sunday was like buying plywood to cover the windows in hurricane season as storm clouds materialize – prudent, but defensive to minimize what would otherwise ensue.
Canada entered these discussions with all sorts of distracting ideas: clauses on gender and Indigenous rights, labour and environmental standards, among them. Sorry, wrong White House. That guy timed out in 2016.
Not so long ago, Canada was taking a more practical, hopeful note about the need to modernize the 1994 deal and bring it into the digital age. It had this belief, stoked by history, that America would come to its senses and realize we were BFFs.
Sorry, wrong White House again. The new guy believes Canadians set fire to his home early in the 19th century.
Instead, today, as polite and deferential world players, we are gauging our country’s success – the “great day for Canada” Justin Trudeau professed – not by what was gained but by how little was lost.
The United States forced Canada’s hand and correctly held out the spectre of economic turmoil if Canada didn’t participate in time. After all, America’s economy might withstand a trade war in a non-NAFTA context, but Canada’s likely wouldn’t.
At first reading, it is apparent American negotiators extracted more access to our dairy and chicken markets.
The deal caps how our auto industry could grow, but more mildly than expected. It kept a mechanism of sorts in place to resolve disputes, even though the courts are quite kind anyway.
Interestingly, it permits countries to pull out if one of them creates a trade pact with a “non-market economy,” sending a signal that a Canada-China deal has to meet the approval of our southern neighbour.
Just as poignantly, America didn’t concurrently lift the very tariffs it earlier placed on Canadian steel and aluminum as extra leverage for trade bargaining – it claims those are, all of a sudden, on a different track to resolve. Trump suggested Monday that the effect of any eventual deal has to have equivalent benefit to the tariffs.
It remains in charge of the proceedings.
Nowhere to be found is the winwin-win that chief Canadian negotiator Chrystia Freeland sought.
About the best we can say is that it could have been worse. Our dollar could be cratering, our industries could be girding for great pain, and we could be entering a period of undue uncertainty greater than at any time in recent memory.
Instead, we have peace with a price.
A bully has a tendency once a fight is won to befriend the weaker one, and so it was as Trump talked about “working together” as a continent to ensure the rest of the world does not take advantage of us.
I’m not sure we want him as our watchdog – he talked about our “energy” and “timber” – but we can’t always choose our protector.
So, our covenant with the U.S. and Mexico today has a new term sheet, even a new name: the USMCA, the U.S.-Mexico-Canada-Agreement.
Doesn’t exactly roll off the tongue like NAFTA. Sounds like US-MECCA. (How about scrambling the letters a bit? SCAM-U has a certain feel to it. Or CAMUS, like the author of The Fall or A Happy Death.)
Mainly, we can breathe a little easier with the foot off our neck.
The U.S. president can claim victory, which is all-important to him in every aspect of life. Canada can claim, well, that even if we didn’t get the bully to stand down, we were not exactly taken down.
Kirk LaPointe is the editor-inchief of Business in Vancouver and vice-president, editorial, of Glacier Media.