Sleeping With An Elephant

Donald Trump has left the White House. But that doesn't mean that the relationship between the United States and Canada is all sweetness and light. Campbell Clark writes:

The supposed kinship between Mr. Trudeau’s Liberals and Mr. Biden’s Democrats hasn’t led to a seamless relationship. The two countries couldn’t even co-ordinate the reopening of the border – Canada allowed fully vaccinated travellers to enter as of Aug. 9, but the United States waited three more months.

But there are bigger concerns now. When Mr. Trudeau heads to Washington next week for the Three Amigos summit of leaders of the U.S., Mexico and Canada, he will find the dangers to Canada’s economic interests haven’t gone away.

Mr. Biden isn’t Mr. Trump, but he is still a leader trying to harness economic nationalism in a divided U.S. political scene. And he’s backed by congressional Democrats who favour protectionist policies.

It’s not just the Buy American provisions in the big spending bills rolling through Congress. Instead of the tariffs threatened by Mr. Trump, there are proposals to give U.S. car buyers hefty incentives to buy American-made electric vehicles, which would encourage car makers to set up EV plants in the U.S., instead of Canada.

“It’s a bigger threat than anything pointed at us by Donald Trump,” said Flavio Volpe, president of the Automotive Parts Manufacturers’ Association.

The difficulties in the relationship were exacerbated by the pandemic and by other irritants:

Mr. Trudeau’s senior advisers couldn’t travel to press the flesh when Mr. Biden was elected. There was a pandemic. The transition period was marked by the Jan. 6 storming of Congress. Mr. Biden took over a divided country, and focused on domestic politics. Mr. Trudeau’s advisers have still tried to reach out to Mr. Biden’s, but until recently, mostly by phone.

But what is really missing is a Biden-era corollary to the full-court-press strategy that Mr. Trudeau’s government launched when Mr. Trump threatened to tear up NAFTA. Not the panic stations and the war room, but the lobby effort aimed at a broad cross-section of U.S. power players – legislators, governors, mayors, business and union leaders.

But we need a new strategy to deal with Biden:

Mr. Biden isn’t going to kill the EV incentive just to do Canada a favour. Mr. Trudeau’s government has to convince Americans, including Mr. Biden’s allies, that it isn’t in their interests. Mr. Volpe argued that Canada and Mexico could agree to offer the same incentive, to make it a North American electric-vehicle rebate – sidestepping the trade damage while joining the U.S. green initiative.

Of course, it is still possible that the electric-vehicle incentive, and its threat to Canada’s auto sector, will die in Congress. West Virginia Democratic Senator Joe Manchin, a key swing vote, is opposed. If it does, we can expect another such threat to come up in the future – so it would be wise to stay on edge.

Justin's father famously said that living next to the United States was like sleeping with an elephant: "No matter how friendly or even-tempered is the beast . . . one is affected by every twitch and grunt."

The elephant keeps rolling over on your side of the bed.

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