Paul Koring writes that Canadians got a rude awakening last week:
Their beloved country doesn’t matter much, or at least not as much as they like to think.
Mexico and the United States are hammering out a new trade deal. Canada isn’t at the table.
While Foreign Minister Chrystia Freeland twiddles her thumbs (no more impulsive tweets slamming the Saudis, please) and waits to be summoned to Washington, it behooves Canadians to reflect on why Canada is the odd man out in the new NAFTA.
John Kennedy once sang the praises of Canada. But he was, first and foremost, looking out for his own country's interests:
Kennedy spoke in May 1961, months before the standoff at the Berlin Wall nearly turned the Cold War thermonuclear hot and a year before the even-more dangerous Cuban missile crisis. In 1961, Canada’s vast geography was vital airspace defending the United States from the waves of manned Soviet bombers threatening nuclear Armageddon. Canada’s very existence was essential to United States’ interests. Canadian fighter-bombers based in Europe were capable of dropping U.S. nuclear bombs to turn Russian cities into smoking and radioactive graves for millions. Canadian warships (including an aircraft carrier) were hunting Soviet submarines in the North Atlantic during the blockade of Cuba. It didn’t matter that Kennedy, an elitist, and Diefenbaker, an anti-establishment populist, hated and insulted each other.
During the Cold War, Canada was admired and punched above its weight:
By the time the Berlin Wall fell in 1989, Canada was the world’s pre-eminent peacekeeper. It had never missed a UN-mandated mission, and by the early 1990s had more blue helmets in more places on the planet than any other country. The country was a regular on the Security Council. In the Commonwealth and the Francophonie – both of which have since faded in importance – Canada, unhampered by the colonial-power burden, played a major role in development and human rights, including leading the international fight against the racist South African apartheid.
But the world has changed. Trump desperately wants to be Russia's ally. And Mexico matters more to Americans than Canada:
What is now starkly evident — and should have dawned on Canadians years ago — is that the U.S.-Mexico relationship has already eclipsed the Canadian-American romance and it will continue to become even more important in the decades ahead.
In economic terms, although Canada-U.S. trade remains larger, it will soon be overtaken by U.S.-Mexican trade, perhaps within five years. With 130-million people and a fast-growing middle class, Mexican offers far more than Canada in terms of America’s future economic growth and and market opportunities.
In the political space, Mexico already matters far more than Canada. Political races in the United States are won and lost on immigration, the border wall, and Mexican-related issues. More than 36-million Mexican-Americans live in the United States. Most are citizens who can vote. They care deeply about the millions more who can’t vote. And all of them matter in the intense political debate, unlike the fewer-than-1-million Canadians resident in the United States who have little to no political clout.
It's time to face a new reality. The United States is no longer a reliable ally:
The grim reality is that Canadians spent the last 25 years binding their well-being to an increasingly lopsided economic relationship with the United States. At the same time Canada was becoming less consequential on the world stage and thus less important to U.S. geopolitical interests. Canada’s Cold War roles have gone and it hadn’t created new ones to replace them.
Canada’s economy is at risk of collapsing without (mostly) free trade with the United States. The converse simply isn’t true. Canada’s economy is roughly the size New York state’s or Illinois and Michigan combined. Losing the Canadian market (actually losing a tariff-free Canadian market) would badly hurt some U.S. businesses but poses no dire threat to the overall U.S. economy.
We have to forge new relationships. The oldest -- and most basic one -- no longer serves our interests.
Image: Quotefancy
6 comments:
First - who has any insights into Paul Koring’s investment portfolio(s)?
“Canadians” have been trading for 500+ years and the U.S.A didn’t exist until 1776.
Our oldest trade relationships are with the First Nations and Inuit, and then a bit later with the Brits and the French.
While he is certainly their problem to deal with, Donald Trump is not the U.S.A.
Economy is not equal to “foreign investment” or “foreign sales”
Our internal economy is more than capable of sustaining itself. If we continue to pay attention to other opportunities it will be quite easy to ignore the current GOP sponsored Trumpian-Dystopia.
kt
This might be a fine opportunity to take stock of Canada's place in the world and how we may wish to recalibrate that to meet the changing conditions expected over just the next few decades.
You're familiar with last week's report in the Proceedings of the National Academy of Sciences that suggested, even if we meet the Paris climate summit target of limiting man-made warming to 2C, natural feedback loops could easily propel us to "hothouse" conditions of 5C or more.
Today a report published in Nature warns that we're in for at least four more excessively hot years like what we're experiencing this summer. The term used was "anomalously warm." As I read that my mind turned to agricultural production and food security if we experience a succession of extremely hot years.
Four more years of this may redefine every nation's standing among all others. It will certainly impact the relationship among the NAFTA partners and it's unlikely to be the United States or Mexico that best accommodates that climate upheaval.
We have failed miserably at mapping our resilience and vulnerabilities to what we may experience over just the next five years. It's telling that economic forecasts and trade negotiations, including NAFTA, continue to exclude consideration of climate change forcings which may gore their ox.
If these studies are relatively accurate, we are embarking on a reality of which we have no useful experience. It could be that all bets are off but that reaches near certainty so long as we continue our dealings, domestic and international, as though we're somehow still in the 80s.
I agree that, if we pay attention to other opportunities, we will be able to manage quite well, kt. However, Brian Mulroney tried to convince us that our future rested on closer ties with the United States. Recent history should convince us that Mulroney was short sighted.
If nothing else, the radical weather we've been having should convince us that we're not in Kansas anymore, Mound. Every crisis represents an opportunity. How we think, plan and react to it makes all the difference.
From this perspective of uncertainty, Owen, Trump's demand for a "sunset clause" could work to Canada's benefit. We may have no end of compelling reasons to want out of any free trade deal five years from now, especially agreements that lock in other nations' access to our natural resources.
The price we pay for gasoline is set in the United States, Mound. I'm sure other prices are governed by American considerations. When the president is a serial bankrupt, that phenomenon could spell disaster.
Post a Comment