tag:theconversation.com,2011:/us/topics/usmca-60377/articlesUSMCA – The Conversation2024-03-01T02:39:56Ztag:theconversation.com,2011:article/2248522024-03-01T02:39:56Z2024-03-01T02:39:56ZBrian Mulroney, champion of free trade, brought Canada closer to the U.S. during his reign as prime minister<p>Brian Mulroney — Canada’s 18th prime minister who has <a href="https://twitter.com/C_Mulroney/status/1763337379165934039">died at age 84</a> — will be remembered for many things, but his most significant decision during two terms in office was to link Canada’s future with the United States.</p>
<p>Unlike Pierre Trudeau, Canada’s Liberal prime minister <a href="https://www.snopes.com/fact-check/did-trudeau-say-worse-things-better-men/">who had a rocky relationship with several U.S. presidents</a> during the 1960s, ‘70s and '80s, Mulroney was an unabashed Americanophile. </p>
<p>After all, he <a href="https://www.tourismebaiecomeau.com/histoire?lang=en">grew up in Baie-Comeau</a>, Que., a town founded by a wealthy American industrialist — Robert Rutherford McCormick — to produce cheap newsprint for New York and Chicago papers. Mulroney would at times reminisce that as a child he sang songs for McCormick to earn small monetary rewards. </p>
<h2>Negotiated Free Trade Agreement</h2>
<p>Mulroney’s admiration for American capitalism was evident in his political polices. Within a year after being <a href="https://www.cbc.ca/archives/brian-mulroney-wins-stunning-landslide-victory-in-1984-1.4675926">elected with a large majority in 1984</a>, Mulroney stated he wanted to negotiate a free trade agreement with the United States. </p>
<p>Shortly after that, Mulroney hosted then U.S. president Ronald Reagan for what was called the <a href="https://montrealgazette.com/news/local-news/history-through-our-eyes/history-through-our-eyes-march-17-1985-the-shamrock-summit">“Shamrock Summit”</a> in Québec City. The two leaders, both of whom were proud of their Irish heritage, took to the stage at the summit and famously launched into a rendition of <em>When Irish Eyes Are Smiling</em>.</p>
<p>While some Canadians may have cringed at the sight of the two men warbling together, Mulroney’s close relationship with Reagan was a political asset for the Progressive Conservative leader.</p>
<h2>A second majority</h2>
<p>Mulroney and Reagan signed the U.S.-Canada Free Trade Agreement on Jan. 2, 1988. Mulroney campaigned on the deal during Canada’s general election in November of that year and won a second consecutive majority. Some international media outlets dubbed Mulroney “<a href="https://www.barrons.com/news/brian-mulroney-ex-canadian-pm-and-father-of-north-american-free-trade-ba03b008">the Father of North American Free Trade</a>” in stories about his death.</p>
<p>The Mulroney years marked the end of a two-decade reign by the Liberals under Lester Pearson, Trudeau and John Turner. Mulroney shifted Canadian policy to the right when he negotiated the Free Trade Agreement. Other controversial policies — the <a href="https://www.thecanadianencyclopedia.ca/en/article/crown-corporation#Privatization">privatization of Crown corporations</a> like Air Canada and Petro-Canada, and the <a href="https://www.thestar.com/news/history-of-the-gst/article_1b750dd8-dab3-5292-adbb-76cb681df763.html">introduction of the goods and services tax (GST)</a> — would last and not be undone when the Liberals returned to power under Jean Chrétien in 1993.</p>
<p>Mulroney, more than any modern day prime minister, sought to atone for the actions of his predecessor Trudeau in constitutional reform.</p>
<p>Investing enormous political capital in the <a href="https://www.historymuseum.ca/blog/meech-lake-accord-fails/">Meech Lake Accord</a> and then the <a href="https://www.constitutionalstudies.ca/2019/07/charlottetown-accord/">Charlottetown Accord</a>, Mulroney tried to increase the jurisdiction of the provinces, reform the Senate and recognize Québec as a distinct society. He wanted to extensively change the Constitution and correct what was not done, or in his view done poorly, in the patriation of the Constitution in 1982 and the introduction of the Charter of Rights and Freedoms. </p>
<h2>Constitutional reforms failed</h2>
<p>After pitched battles across the nation, both accords failed to meet the constitutional bar for ratification. In fact, the collapse of the accords — which had raised expectations in Québec — revived Québec separatism and <a href="https://www.ctvnews.ca/politics/mulroney-dismissed-bouchard-s-influence-as-meech-lake-accord-withered-records-1.1742812">led to the rise of the Bloc Québécois</a>.</p>
<p>The failure of the accords was a lesson subsequent prime ministers — Chrétien, Stephen Harper and Justin Trudeau — took to heart. None has dared to even hint at any kind of constitutional reform.</p>
<p>When in power, Mulroney led the Progressive Conservatives. After retirement from politics, Mulroney never felt at home at the renamed Conservative Party of Canada that was born with the <a href="https://www.ctvnews.ca/5-things/flashback-friday-on-this-day-in-2003-pcs-and-alliance-united-as-conservatives-1.2607589">merger of the Progressive Conservative Party and the Canadian Alliance in 2003</a>. </p>
<p>During one of his last major public events in June 2023, Mulroney sat on stage with Justin Trudeau at St. Francis Xavier University, the Nova Scotia institution from which Mulroney graduated. Mulroney <a href="https://www.cbc.ca/news/politics/brian-mulroney-defends-trudeau-parliament-gossip-trash-1.6882315">praised the incumbent</a> to such an extent that Trudeau said: “It’s… embarrassing when you’re speaking about me in such glowing terms.” </p>
<p>Mulroney leaves a perplexing legacy. A charismatic politician who led his party to two majority governments. A prime minister who made major and lasting changes to Canada’s economy. A successful business leader before and after his years in politics. </p>
<p>Yet, he was also a prime minister who failed to bring in constitutional reforms that seemed within his grasp and a leader who unleashed political turmoil in his home province that has had a lasting impact on the Canadian political landscape decades after he left office.</p><img src="https://counter.theconversation.com/content/224852/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Thomas Klassen does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The death of former Canadian prime minister Brian Mulroney will lead to a wide examination of his legacy. A lasting policy of the Mulroney regime is free trade with the United States.Thomas Klassen, Professor, School of Public Policy and Administration, York University, CanadaLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1977712023-01-23T18:54:12Z2023-01-23T18:54:12ZMore means less: Extended copyright benefits the corporate few, not the public<figure><img src="https://images.theconversation.com/files/504764/original/file-20230116-14-bardrl.jpg?ixlib=rb-1.1.0&rect=54%2C20%2C2737%2C1983&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Canada's extension of copyright to 70 years after an author's death puts corporate profits ahead of the public interest.</span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/christopherdombres/5814893360/in/photostream/">(CHRISTOPHER DOMBRES/flickr)</a></span></figcaption></figure><p>Who benefits from Canada’s recent extension of copyright? Dead authors? Students? Marginalized writers? If you answered no to all of these, you’d be correct. </p>
<p>At the beginning of January, <a href="https://www.cbc.ca/news/entertainment/canada-public-domain-pause-1.6706498">Canada extended its copyright period</a> by an additional 20 years after an author’s death. Previously, copyright lasted up to 50 years after an author’s death. The extension means that works will not enter the public domain in Canada for 70 years after a creator’s death. </p>
<p>The <a href="https://canlii.ca/t/jqgw0">Supreme Court of Canada</a> has made it clear that “Copyright law does not exist solely for the benefit of authors,” but is meant to balance the rights of users and authors. </p>
<p>The <a href="https://www.canlii.org/en/ca/scc/doc/2021/2021scc32/2021scc32.html?resultIndex=1">Supreme Court</a> has also stated that while copyright should ensure a just reward as incentive for authors, “increasing public access to and dissemination of artistic and intellectual works, which enrich society and often provide users with the tools and inspiration to generate works of their own, is a primary goal of copyright.”</p>
<p>The latest copyright extension is a result of the trade negotiations that created the <a href="https://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/cusma-aceum/index.aspx?lang=eng">Canada-United States-Mexico Agreement (CUSMA)</a> — the successor to the <a href="https://www.canada.ca/en/treasury-board-secretariat/services/policy-notice/contracting-policy-notice-2020-2-replacement-north-american-free-trade-agreement-nafta.html">North American Free Trade Agreement (NAFTA)</a>.</p>
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<a href="https://images.theconversation.com/files/504305/original/file-20230112-69951-mdyx52.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="Three men wearing suits sit at a table. Two of them hold up booklets with signatures. Behind them are flags of mexico, canada and the U.S." src="https://images.theconversation.com/files/504305/original/file-20230112-69951-mdyx52.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/504305/original/file-20230112-69951-mdyx52.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=333&fit=crop&dpr=1 600w, https://images.theconversation.com/files/504305/original/file-20230112-69951-mdyx52.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=333&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/504305/original/file-20230112-69951-mdyx52.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=333&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/504305/original/file-20230112-69951-mdyx52.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=418&fit=crop&dpr=1 754w, https://images.theconversation.com/files/504305/original/file-20230112-69951-mdyx52.JPG?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=418&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/504305/original/file-20230112-69951-mdyx52.JPG?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=418&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Canadian Prime Minister Justin Trudeau at a signing ceremony for the CUSMA agreement with the then-presidents of the U.S. and Mexico in Buenos Aires, Argentina in November 2018.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Sean Kilpatrick</span></span>
</figcaption>
</figure>
<p>Like any monetary negotiation, these <a href="https://www.imf.org/en/Publications/fandd/issues/Series/Back-to-Basics/Trade">trade agreements</a> include give and take. Canada gets greater access to U.S. markets, for example, while the U.S. gets Canada to adopt the same copyright duration that they have.</p>
<p>Copyright material is increasingly valuable to Canada. In 2019, copyright-based industries contributed about $95.6 billion to Canada’s economy and made up around <a href="https://www.canada.ca/en/canadian-heritage/corporate/transparency/open-government/economic-impact-copyright-based-industries.html">4.9 per cent of GDP</a>. That means the country needs a more fine-tuned approach to trade deals. And a better understanding of how to best foster our creative industries.</p>
<h2>Who benefits from longer copyrights?</h2>
<p>Most authors need to license their work for it to reach a wide audience. The <a href="https://laws-lois.justice.gc.ca/eng/acts/c-42/"><em>Copyright Act</em></a> grants first ownership to the author who can license it. The act also states that the economic rights belong to the owner of the copyright. That is most often a media company, <a href="https://cb-cda.gc.ca/en/copyright-information/collective-societies">collective society</a>, publisher or other corporate entity. </p>
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<a href="https://images.theconversation.com/files/504307/original/file-20230112-60779-sqm2jw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="A woman with grey hair carries a book." src="https://images.theconversation.com/files/504307/original/file-20230112-60779-sqm2jw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/504307/original/file-20230112-60779-sqm2jw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=784&fit=crop&dpr=1 600w, https://images.theconversation.com/files/504307/original/file-20230112-60779-sqm2jw.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=784&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/504307/original/file-20230112-60779-sqm2jw.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=784&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/504307/original/file-20230112-60779-sqm2jw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=985&fit=crop&dpr=1 754w, https://images.theconversation.com/files/504307/original/file-20230112-60779-sqm2jw.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=985&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/504307/original/file-20230112-60779-sqm2jw.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=985&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">The extension of copyrights means Canadians will have to wait much longer for works like Margaret Atwood’s Handmaid’s Tale to enter the public domain.</span>
<span class="attribution"><span class="source">(AP Photo/Alastair Grant)</span></span>
</figcaption>
</figure>
<p>If copyright is a way to incentivize and reward creativity, that incentive should manifest while the author is still alive. The idea of authors benefiting during their lifetime was brought to Parliament’s Copyright Review Committee in 2018 by musician <a href="https://www.michaelgeist.ca/2018/12/bryan-adamscopyrightwarning/">Bryan Adams</a>. </p>
<p>In Canada, copyrights are usually turned over to an author’s heirs <a href="https://laws-lois.justice.gc.ca/eng/acts/C-42/section-14.html">25 years after their death</a>. This right is one of the ways the <em>Copyright Act</em> seeks to maintain a balance between having an economic incentive to be creative and making works available to others for education and inspiration. </p>
<p>Adams suggested that this would do a lot more good for authors if it were to occur 25 years after the copyright was initially granted. That would mean an author could gain greater benefits during their lifetime. </p>
<p>If further proof was needed regarding who really benefits from this extension, an article from <a href="https://ip.fasken.com/who-really-benefits-from-canadas-impending-copyright-term-extension/">Jean-Philippe Mikus of Fasken law firm</a> makes it clear. </p>
<p>Mikus states that the term extension is a “positive development” for copyright owners. But he also highlights that an author’s heirs can simply have the works handed to them. He goes on to suggest that Canadian law needs to copy the <a href="https://edwardslaw.ca/blog/work-made-for-hire-explained/">American work-for-hire model</a>, essentially ensuring that authors have no claim or ownership in their own creations.</p>
<h2>The public domain</h2>
<p>Another important aspect of copyright is its public interest goal, and works entering the public domain are essential to fulfill that goal. <a href="https://www.ifla.org/publications/the-public-domain-why-wipo-should-care-2007/#:%7E:text=The%20public%20domain%20is%20part,commercial%20and%20non%2Dcommercial%20purposes">The International Federation of Library Associations and Institutions</a> clearly outlines the importance of works entering the public domain:</p>
<blockquote>
<p>“The public domain is part of the common cultural and intellectual heritage of humanity and is the major source of inspiration, imagination and discovery for creators. Works in the public domain are not subject to any restrictions and may be freely used without permission for commercial and non-commercial purposes. It is important for access to knowledge and must be accessible for the benefit of creators, inventors, universities and research centres.”</p>
</blockquote>
<figure>
<iframe width="440" height="260" src="https://www.youtube.com/embed/SiEXgpp37No?wmode=transparent&start=0" frameborder="0" allowfullscreen=""></iframe>
<figcaption><span class="caption">Large corporations like Disney have lobbied the U.S. Congress to extend copyright protections.</span></figcaption>
</figure>
<p>Law professor <a href="https://www.michaelgeist.ca/2022/04/the-harm-from-budget-2022s-hidden-copyright-term-extension-part-one-entry-to-public-domain-of-canadian-authors-lost-for-a-generation/">Michael Geist</a> points out that an entire generation will lose out on works not entering the public domain for an additional 20 years. </p>
<p>The extension of copyright has been described as essentially <a href="https://www.techdirt.com/2022/11/29/canada-steals-cultural-works-from-the-public-by-extending-copyright-terms/">stealing cultural works from the public</a>. Canadian authors whose works fall under the extended copyright period include Marian Engel, Adele Wiseman, Hugh MacLennan, Margaret Laurence, bpNichol and Gabrielle Roy, to name just a few.</p>
<p>The public domain allows publishers to publish works that may have been languishing elsewhere because they weren’t seen as being economically viable. In addition, with fewer royalties to pay for the work, publishers are able to add pedagogical material to the text. </p>
<p>It is unlikely that any government will pass legislation to roll back the duration of copyright, but that doesn’t mean there is nothing that can be done. </p>
<p><a href="https://www.michaelgeist.ca/2022/04/the-canadian-government-makes-its-choice-implementation-of-copyright-term-extension-without-mitigating-against-the-harms/">Geist argues</a> for a registration system for the new extension. The author (owner) of the copyright would have to proactively register the copyright to retain it for the additional 20 years. This would allow works to still enter the public domain, particularly works that might not be being published because they aren’t seen as lucrative enough. </p>
<p>Under the <em>Copyright Act</em>, “<a href="https://laws-lois.justice.gc.ca/eng/acts/c-42/page-6.html#h-103270">Fair dealing for the purpose of research, private study, education, parody or satire does not infringe copyright</a>.” But expansion of the fair dealing exception to include “such as” before the listed purposes could also help encourage new creations and bolster educational goals. </p>
<p>Adding “such as,” similar to <a href="https://www.copyright.gov/help/faq/faq-fairuse.html">fair use in the U.S.</a>, makes the list illustrative and allows for wider interpretation of what is an allowable use. This would be in line with <a href="https://www.ourcommons.ca/Content/Committee/421/INDU/Reports/RP10537003/indurp16/indurp16-e.pdf">recommendation 18 of the government’s Statutory Review of the Copyright Act</a>. </p>
<p>Corporate copyright owners are ultimately most concerned about their bottom line. Better protections for users’ rights are needed to ensure the public retains access to Canadian culture and heritage so Canadian creativity and innovation can continue to thrive.</p><img src="https://counter.theconversation.com/content/197771/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Lisa Macklem is a PhD Candidate in Law at the University of Western Ontario. She currently teaches at Western, King's University College and Brescia University College. She is cited in York University v. Canadian Copyright Licensing Agency (Access Copyright), 2021 SCC 32 and The Statutory Review of the Copyright Act, both of which are cited in this article.</span></em></p>Canada’s extension of copyright might be good for corporations that hold copyrights, but it’s bad news for creators and the public.Lisa Macklem, PhD Candidate, Law, Western UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1686852021-09-24T16:02:42Z2021-09-24T16:02:42ZWhy the UK’s ambitious plans for a trade deal with the US have been shelved<p>A trade deal between the UK and the US was once counted as a great <a href="https://www.theguardian.com/politics/2021/sep/21/britains-hopes-of-early-post-brexit-trade-deal-with-us-appear-dashed">potential prize of Brexit</a>. But now those plans have been delayed, with no clear timetable in sight.</p>
<p>Downplaying expectations of an agreement between the two countries before he met with the US president on September 21, British prime minister Boris Johnson said that Joe Biden had a “<a href="https://news.sky.com/story/boris-johnon-refuses-to-commit-to-us-uk-trade-deal-being-done-by-2024-as-he-says-joe-biden-has-a-lot-of-fish-to-fry-12413356">lot of fish to fry</a>”. </p>
<p>The apparent frostiness of the Biden administration swiftly led to <a href="https://inews.co.uk/news/politics/uk-seek-join-us-mexico-canada-trade-pact-boris-johnson-gives-up-deal-joe-biden-1211275?ito=twitter_share_article-top">suggestions</a> from unnamed British government sources that the UK might instead apply to join the US-Mexico-Canada (<a href="https://www.trade.gov/usmca">USMCA</a>) agreement as an alternative.</p>
<p>The difficulty, of course, is that nobody knew how seriously to take this. There was back tracking soon after, with a <a href="https://www.independent.co.uk/news/uk/politics/usmca-trade-deal-boris-johnson-b1924874.html">Downing Street spokesperson</a> insisting the focus was still a direct deal with the US.</p>
<p>After all, there are towering obstacles to the UK joining the USMCA in practice. For a start, doing so would require the agreement of all three existing members. The fact that they do not appear to have even been consulted about the possibility is something of a diplomatic <em>faux pas</em> and makes the entire situation even stranger. </p>
<p>If the current US administration is unwilling to negotiate a bilateral free trade agreement with the UK, why should it be more predisposed to negotiate a quadrilateral one? </p>
<p>From Joe Biden’s perspective, the political risks are considerable. Given the present scepticism towards trade agreements <a href="https://news.gallup.com/poll/342419/sharply-fewer-view-foreign-trade-opportunity.aspx">among a significant minority</a> of the US public, securing a new one would by no means be universally popular. And at a time when the <a href="https://www.washingtonpost.com/politics/2021/04/07/heres-how-narrow-democratic-house-majority-is/">Democrat majority is wafer-thin</a> and the world is still reeling from the pandemic, it’s a big ask to expect him to focus on including the UK within the USMCA.</p>
<p>As for Canada, it already has a <a href="https://www.gov.uk/guidance/summary-of-the-uk-canada-trade-continuity-agreement">trade agreement with the UK</a> (rolled over from the agreement struck between Canada and the EU) and the two are currently in negotiations to deepen and extend this. </p>
<p>That the Canadians might be nonplussed by the idea of the UK joining the USMCA without any warning seems understandable. It is also, like Mexico, a member of the <a href="https://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/cptpp-ptpgp/index.aspx?lang=eng">Comprehensive and Progressive Trans-Pacific Partnership</a> – another group the UK has <a href="https://www.gov.uk/government/news/uk-applies-to-join-huge-pacific-free-trade-area-cptpp">applied to join</a>. It is difficult to see either of these two countries seeing any benefit from expanding the USMCA to include the UK. What’s in it for them? </p>
<h2>Winners and losers</h2>
<p>Similar questions might be asked of the UK’s motivations. Our own research related to Canada, for example, <a href="https://www.tandfonline.com/doi/10.1080/21582041.2018.1558277">suggests</a> that the impact on trade and GDP of any further deepening of ties beyond bilateral agreements (both those already in place and any yet to be completed) would be small at best. </p>
<p>Given the challenges of distance and geography, as well as the relatively <a href="https://www.rug.nl/ggdc/productivity/pwt/?lang=en">modest size</a> of the Mexican and Canadian markets relative to the US, EU and China, any benefits would be minor. </p>
<p>And even an exclusive agreement with the US would have only a tiny impact on UK GDP and living standards. The Department for International Trade <a href="https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/869592/UK_US_FTA_negotiations.pdf">estimates</a> between 0.05% and 0.36% of extra GDP from an ambitious deal, and somewhere from 0.02% to 0.15% based on a – perhaps more realistic – limited free trade agreement. </p>
<figure class="align-center ">
<img alt="US and UK flags on a desk next to paper and pens." src="https://images.theconversation.com/files/423152/original/file-20210924-23-j1uakw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/423152/original/file-20210924-23-j1uakw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=350&fit=crop&dpr=1 600w, https://images.theconversation.com/files/423152/original/file-20210924-23-j1uakw.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=350&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/423152/original/file-20210924-23-j1uakw.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=350&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/423152/original/file-20210924-23-j1uakw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=440&fit=crop&dpr=1 754w, https://images.theconversation.com/files/423152/original/file-20210924-23-j1uakw.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=440&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/423152/original/file-20210924-23-j1uakw.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=440&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Nothing signed yet…</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-illustration/usa-british-flags-on-table-negotiation-1560827963">Shutterstock/vchal</a></span>
</figcaption>
</figure>
<p>To make those rather abstract figures feel real, that would equate to a pay rise of anywhere between roughly 50 pence and £9 per month for the average British worker. </p>
<p>Nor would an eventual deal with the US benefit every sector of the British economy. Agriculture and food processing could be particularly at risk, depending on the specifics of any agreement. There are also broader questions of what the UK would be willing to sacrifice. For example, would British consumers be prepared to import and buy food from animals treated with hormones? </p>
<p>For the time being then, it seems that the UK faces an uphill battle to secure meaningful further access to the markets of the American continent. There appears to be little appetite from across the Atlantic to reach for much beyond the status quo. </p>
<p>For the UK, a more realistic approach might be to work to gradually secure a reduction in various non-tariff barriers over time. Anything more than that seems, right now, like something of an unattainable prize.</p><img src="https://counter.theconversation.com/content/168685/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Joe Biden seems to have little appetite for closer economic ties.Alex de Ruyter, Professor of Economics and Director of the Centre for Brexit Studies, Birmingham City UniversityDavid Hearne, Researcher at the Centre for Brexit Studies, Birmingham City UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1537622021-01-31T14:00:28Z2021-01-31T14:00:28ZWhat Biden’s presidency means for Canada-U.S. agri-food trade<figure><img src="https://images.theconversation.com/files/380338/original/file-20210124-19-14iw1hi.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C4000%2C2886&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Prime Minister Justin Trudeau and Joe Biden, U.S. vice president at the time, walk down the Hall of Honour on Parliament Hill in Ottawa in December 2016. </span> <span class="attribution"><span class="source">THE CANADIAN PRESS/Patrick Doyle</span></span></figcaption></figure><p>Although international trade has long been affected by domestic politics, former U.S. president Donald Trump dramatically increased trade irritants between the United States and Canada. This was especially challenging in the agricultural sector where political interference in international trade is more prevalent than in the non-agricultural sector. </p>
<p>In our recent article in the <a href="https://doi.org/10.1111/cjag.12267"><em>Canadian Journal of Agricultural Economics</em></a>, we analyzed how Trump’s presidency affected agri-food trade between the two countries and how the situation might change under President Joe Biden. </p>
<p>We argue that Trump’s negative rhetoric and actions heightened trade uncertainty and undermined global trading rules, which tends to disrupt international trade. This was a major challenge for a small open economy like Canada that depends largely on the American market. In particular, the politically sensitive nature of the agri-food sector makes agricultural trade highly dependent on diplomatic ties between countries.</p>
<h2>Canada more reliant on the U.S.</h2>
<p>Canada’s relationship with the U.S. is important for the agri-food sector in both countries, but it’s somewhat one-sided in terms of Canadian reliance on the American market. </p>
<p>Canada is the top destination for American agricultural exports, accounting for 15 per cent of the country’s total agricultural <a href="https://www.fas.usda.gov/regions/canada">exports in 2019</a>. Conversely, the U.S. is the foremost buyer of Canadian agri-food products, accounting for <a href="https://www.fas.usda.gov/regions/canada">58 per cent of total Canadian agri-food exports</a>. This isn’t surprising due to the countries’ close proximity and similar consumer tastes and values.</p>
<p><a href="https://doi.org/10.1080/02722011.2020.1748925">But the Canada-U.S. political relationship became hostile</a> during the Trump presidency due to the former president’s erratic foreign policy decisions, tariff wars and his <a href="https://www.washingtonpost.com/politics/trump-attacks-canada-to-show-north-korea-hes-strong-aide-says/2018/06/10/afc16c0c-6cba-11e8-bd50-b80389a4e569_story.html">verbal attacks on Prime Minister Justin Trudeau</a>. The tense political relationship created an environment of uncertainty, adversely affecting the bilateral trading relationship. </p>
<figure class="align-center ">
<img alt="A cyclist rides between two bright-yellow canola fields." src="https://images.theconversation.com/files/381122/original/file-20210128-17-1hr0fyr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/381122/original/file-20210128-17-1hr0fyr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=354&fit=crop&dpr=1 600w, https://images.theconversation.com/files/381122/original/file-20210128-17-1hr0fyr.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=354&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/381122/original/file-20210128-17-1hr0fyr.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=354&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/381122/original/file-20210128-17-1hr0fyr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=445&fit=crop&dpr=1 754w, https://images.theconversation.com/files/381122/original/file-20210128-17-1hr0fyr.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=445&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/381122/original/file-20210128-17-1hr0fyr.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=445&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">A cyclist passes between two canola fields near Cremona, Alta., in a July 2016. The U.S. was the top market for Canadian canola in 2019.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Jeff McIntosh</span></span>
</figcaption>
</figure>
<p>Major trade disputes between the two countries at both the World Trade Organization (WTO) and within the former North American Free Trade Agreement (NAFTA) <a href="https://www.jstor.org/stable/4128725?seq=1#metadata_info_tab_contents">have largely involved the agricultural sector</a>. WTO trade disputes over softwood lumber, hard wheat and durum and the compulsory country-of-origin labelling requirements, for example, were all within the agricultural sector. </p>
<p>The long-standing softwood lumber dispute predates Trump, but was <a href="https://www.nytimes.com/2017/04/24/us/politics/lumber-tariff-canada-trump.html">escalated during his presidency</a> and could not be sorted out under NAFTA and WTO dispute settlement mechanisms. It was resolved only through political negotiations when both parties signed a <a href="https://www.international.gc.ca/controls-controles/softwood-bois_oeuvre/recent.aspx?lang=eng">memorandum of understanding</a>.</p>
<h2>Canada diversifying?</h2>
<p>The graph below shows that although bilateral agri-food exports from Canada to the U.S. increased marginally from 2015 and 2019, Canadian agri-food imports from the U.S. remained flat. </p>
<figure class="align-center ">
<img alt="A graph shows agri-food imports and export numbers between Canada, the U.S. and the rest of the world." src="https://images.theconversation.com/files/380078/original/file-20210121-15-i9kkvo.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/380078/original/file-20210121-15-i9kkvo.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=372&fit=crop&dpr=1 600w, https://images.theconversation.com/files/380078/original/file-20210121-15-i9kkvo.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=372&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/380078/original/file-20210121-15-i9kkvo.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=372&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/380078/original/file-20210121-15-i9kkvo.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=468&fit=crop&dpr=1 754w, https://images.theconversation.com/files/380078/original/file-20210121-15-i9kkvo.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=468&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/380078/original/file-20210121-15-i9kkvo.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=468&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Agri-food imports and exports.</span>
<span class="attribution"><span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>The increasing number of agri-food imports to Canada from nations other than the U.S., and the flat-lining of imports from south of the border, shows the Canadian economy may be diversifying away from the U.S. and not relying solely on Americans to be the main suppliers of its food basket. </p>
<p>Continuing trade uncertainty with the U.S. could push Canada to pursue its market diversification agenda more aggressively. Canada has shown serious signs of market diversification through its membership in two major free-trade agreements — the Comprehensive Economic and Trade Agreement (CETA) with the European Union and the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) with Pacific Rim countries.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/canada-u-k-free-trade-a-post-brexit-opportunity-130970">Canada-U.K. free trade: A post-Brexit opportunity</a>
</strong>
</em>
</p>
<hr>
<h2>Biden’s presidency</h2>
<p>In his inaugural speech, <a href="https://www.nytimes.com/2021/01/20/us/politics/biden-inauguration-speech-transcript.html">Biden promised to immediately work to repair and renew relationships</a> with U.S. allies and return America to a leadership role in the world. <a href="https://www.thestar.com/politics/federal/2021/01/22/joe-biden-tells-justin-trudeau-in-their-first-phone-call-that-buy-american-plan-wont-target-canada.html">His first call to a foreign leader was made to Trudeau</a>, and he assured the prime minister that “Buy American” policies weren’t aimed at Canada.</p>
<p>Biden is facing significant domestic political challenges, and it’s too soon to know how he’ll deal with trade irritants and address the harm done by the Trump administration. But it’s clear he’s intent on returning to multilateralism. </p>
<p>The American dissatisfaction with the World Trade Organization (WTO) predates Trump and runs deep in the U.S. Barack Obama’s administration <a href="https://www.piie.com/blogs/realtime-economic-issues-watch/wto-judicial-appointments-bad-omen-trading-system">also blocked appointments to the appellate body based</a> on this dissatisfaction. However, <a href="https://www.washingtonpost.com/politics/2021/01/14/biden-trade-katherine-tai-tariff/">Biden has been clear about supporting a strong multilateral trading system</a> and isn’t expected to be obstructionist like the Trump administration, but instead will likely work with allies to address concerns with the WTO.</p>
<p>When it comes to trade deals, Biden has acknowledged the importance of deals like <a href="https://www.politico.com/newsletters/morning-trade/2019/08/01/biden-says-he-would-renegotiate-tpp-464000">the CPTPP</a> that Trump pulled out of on his third day in office. But he’s also promised to protect American workers.</p>
<h2>Protectionist forces</h2>
<p>Protectionist forces will continue to disrupt trade between the two countries, but we can expect a closer and more constructive relationship under Biden. Trade disputes won’t disappear, but the approach to them will change, and improved U.S.-Canada diplomatic relations will have a positive impact on Canada’s agri-food sector.</p>
<p><a href="https://www.ctvnews.ca/world/america-votes/president-biden-s-first-foreign-leader-call-will-be-to-pm-trudeau-1.5275207">Canada’s prime minister and Biden</a> are much closer in terms of ideology, policy objectives and leadership style than Trump and Trudeau were, and <a href="https://www.wsj.com/articles/biden-is-expected-to-review-trumps-trade-tariffs-11604917803">they share views on eliminating trade barriers</a> instead of imposing them. </p>
<figure class="align-center ">
<img alt="Joe and Jill Biden wave as they exit a plane." src="https://images.theconversation.com/files/380340/original/file-20210124-23-1bzwecn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/380340/original/file-20210124-23-1bzwecn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=404&fit=crop&dpr=1 600w, https://images.theconversation.com/files/380340/original/file-20210124-23-1bzwecn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=404&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/380340/original/file-20210124-23-1bzwecn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=404&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/380340/original/file-20210124-23-1bzwecn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=508&fit=crop&dpr=1 754w, https://images.theconversation.com/files/380340/original/file-20210124-23-1bzwecn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=508&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/380340/original/file-20210124-23-1bzwecn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=508&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Biden and his wife, Jill Biden, arrive at the airport in Richmond, B.C. in 2015 when he was serving as U.S. vice-president. THE CANADIAN PRESS/Jonathan Hayward.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Jonathan Hayward</span></span>
</figcaption>
</figure>
<p>The past four years of trade tensions between the U.S. and Canada were largely politically motivated, especially Trump’s imposition of steel and aluminium tariffs in the name of national security, which Canada responded to <a href="https://www.canadiangrocer.com/blog/trumps-trade-war-with-canada-and-the-impact-on-grocery-81308">by imposing retaliatory tariffs on a number of agri-food products from the United States</a>. </p>
<p>Such unilateral decisions will probably be minimal under Biden. Bilateral trade flows between both countries are unlikely to be affected by the types of erratic trade actions favoured by Trump.</p>
<p>Closer political ties between the Biden administration and the Canadian prime minister means a more constructive and co-operative approach to solving challenges between the two countries in the agri-food sector. Trade disputes will undoubtedly continue, but diplomatic efforts will work to resolve these disputes. This is a positive development for the Canadian agri-food industry.</p><img src="https://counter.theconversation.com/content/153762/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Sylvanus Kwaku Afesorgbor receives funding from Ontario Ministry of Agriculture and Rural Affairs. </span></em></p><p class="fine-print"><em><span>Eugene Beaulieu does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Closer political ties between Joe Biden and Justin Trudeau likely means a more constructive and co-operative approach to solving challenges between the two countries in the agri-food sector.Sylvanus Kwaku Afesorgbor, Assistant Professor, Agri-Food Trade and Policy, University of GuelphEugene Beaulieu, Professor, Economics, University of CalgaryLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1538142021-01-26T14:42:11Z2021-01-26T14:42:11ZKeystone XL legal risks highlight dangers of putting investors before climate change<figure><img src="https://images.theconversation.com/files/380675/original/file-20210126-19-vnh4oo.jpg?ixlib=rb-1.1.0&rect=297%2C45%2C4705%2C3277&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Opponents of the Keystone XL pipeline demonstrate in Omaha, Neb., on Nov. 1, 2017. </span> <span class="attribution"><span class="source">(AP/Nati Harnik)</span></span></figcaption></figure><p>The chickens have come home to roost for Alberta Premier Jason Kenney. Kenney bet <a href="https://theenergymix.com/2021/01/22/humiliated-kenney-demands-trade-sanctions-could-sell-pipeline-for-scrap-as-tc-shuts-down-keystone-construction/">around $1.5 billion of public money on a very risky prospect</a> — the highly controversial Keystone XL pipeline. </p>
<p>U.S. President Joe Biden, to the surprise of no one but Kenney, followed through on an election promise and <a href="https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-protecting-public-health-and-environment-and-restoring-science-to-tackle-climate-crisis/">cancelled a key permit for the pipeline</a> on the first day of his administration. Now the premier is scrambling for a way to recoup some of Alberta’s losses, <a href="https://www.cbc.ca/news/canada/calgary/kenney-trudeau-letter-keystone-xl-1.5883751">and he sees a trade agreement as offering some hope</a>.</p>
<p>The former North American Free Trade Agreement (NAFTA) contained a chapter on investment that allowed foreign investors to sue governments in international arbitration. The owner of Keystone XL — TC Energy (previously TransCanada) — <a href="https://www.bloomberg.com/news/articles/2016-06-25/transcanada-files-15b-nafta-claim-on-keystone-xl-rejection">used NAFTA to launch a US$15 billion lawsuit</a> in 2016 after President Barack Obama cancelled the project. </p>
<p>At the time, some legal experts thought the company had a <a href="https://www.washingtonpost.com/news/monkey-cage/wp/2016/01/08/transcanada-is-suing-the-u-s-over-obamas-rejection-of-the-keystone-xl-pipeline-the-u-s-might-lose/">reasonable chance of winning</a>. We will never know, because the <a href="https://www.cbc.ca/news/canada/calgary/transcanada-nafta-lawsuit-suspended-1.4003525">case was dropped</a> when President Donald Trump indicated he was willing to let the project proceed. </p>
<figure class="align-center ">
<img alt="Donald Trump flanked by other lawmakers in the Oval Office of the White House." src="https://images.theconversation.com/files/380550/original/file-20210125-21-wibiib.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/380550/original/file-20210125-21-wibiib.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/380550/original/file-20210125-21-wibiib.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/380550/original/file-20210125-21-wibiib.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/380550/original/file-20210125-21-wibiib.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/380550/original/file-20210125-21-wibiib.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/380550/original/file-20210125-21-wibiib.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">President Donald Trump approves a permit to build the Keystone XL pipeline on Mar. 24, 2017.</span>
<span class="attribution"><span class="source">(AP Photo/Evan Vucci)</span></span>
</figcaption>
</figure>
<p>This time may be different if TC Energy chooses to proceed with a claim. NAFTA has been replaced by a new agreement — the U.S.-Mexico-Canada Agreement (USMCA). Unlike NAFTA, <a href="https://doi.org/10.1016/j.esg.2019.100004">USMCA does not permit Canadian investors to sue the U.S. government</a> (or American investors to sue the Canadian government). </p>
<p>Legacy claims for investments that had occurred prior to the USMCA coming into force are permitted until 2023. But TC Energy’s <a href="https://financialpost.com/commodities/tc-energy-and-alberta-face-long-odds-if-they-sue-u-s-government-over-cancelled-keystone-xl">claim may now be weaker</a> because the permit issued by the Trump administration explicitly stated that it could be rescinded, essentially at the president’s whim. </p>
<p>Nevertheless, many investors have proceeded with claims on the basis of much weaker cases. Investors bet on positive outcomes in arbitration, as much as they bet on governments not taking action to halt catastrophic climate change. This is because the anticipated rewards, in both instances, are high.</p>
<h2>Risky business</h2>
<p>One example of an incredibly dubious investor claim is the one launched by <a href="https://icsid.worldbank.org/cases/case-database/case-detail?CaseNo=UNCT/20/3">Westmoreland Mining Holdings against Canada</a> in 2018. Ironically, this case concerns action that the previous Alberta government took to address climate change. </p>
<p>Alberta’s <a href="https://www.alberta.ca/climate-coal-electricity.aspx">2015 Climate Leadership Plan included a provincial phaseout of coal power</a>, which left Westmoreland — an American coal mining firm — without a future market for its coal. <a href="http://icsidfiles.worldbank.org/icsid/ICSIDBLOBS/OnlineAwards/C8473/DS14132_En.pdf">The company is arguing</a> that Alberta’s failure to provide Westmoreland with “transition payments,” like those that power companies received, is a breach of NAFTA. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/the-fossil-fuel-era-is-coming-to-an-end-but-the-lawsuits-are-just-beginning-107512">The fossil fuel era is coming to an end, but the lawsuits are just beginning</a>
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</em>
</p>
<hr>
<p>The case is ongoing and outcomes of arbitration are very difficult to predict. But it demonstrates a concerning trend, as do <a href="https://www.ejiltalk.org/risky-business-unipers-potential-investor-state-dispute-against-the-dutch-coal-ban/">other cases that have emerged in Europe</a>. </p>
<p><a href="https://exxonknew.org">Fossil fuel companies have been well aware</a> of the damage their industry causes for decades, yet they have <a href="https://desmog.co.uk/2021/01/15/api-american-petroleum-institute-oil-industry-public-climate-denial-campaign-1980">exerted substantial efforts to try to slow climate action</a>. They have taken bets on risky investments in the hopes that governments would continue to dither as the planet burns. Now that climate action is starting to ramp up, they want to be “compensated” for their losses. </p>
<figure class="align-center ">
<img alt="A news conference in the Roosevelt Room of the White House" src="https://images.theconversation.com/files/380560/original/file-20210125-23-nq4ag.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/380560/original/file-20210125-23-nq4ag.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=392&fit=crop&dpr=1 600w, https://images.theconversation.com/files/380560/original/file-20210125-23-nq4ag.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=392&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/380560/original/file-20210125-23-nq4ag.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=392&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/380560/original/file-20210125-23-nq4ag.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=493&fit=crop&dpr=1 754w, https://images.theconversation.com/files/380560/original/file-20210125-23-nq4ag.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=493&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/380560/original/file-20210125-23-nq4ag.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=493&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">President Barack Obama, accompanied by Vice President Joe Biden and Secretary of State John Kerry, announces he’s rejecting the Keystone XL pipeline because he does not believe it serves the national interest, on Nov. 6, 2015.</span>
<span class="attribution"><span class="source">(AP Photo/Susan Walsh)</span></span>
</figcaption>
</figure>
<h2>A global problem</h2>
<p>Climate activists may be tempted to dismiss the threat that investment treaties pose to action on climate change. After all, the Canadian and U.S. governments have the resources to rigorously defend themselves in arbitration and they often win. Indeed, the U.S. has never lost a case. Furthermore, governments already subsidize the industry to the tune of <a href="https://www.iisd.org/publications/g20-scorecard">hundreds of billions of dollars per year</a>, so is a few more billion in “compensation” really going to make much of a difference?</p>
<p>The problem is that climate change is a global issue and so too is the <a href="https://investmentpolicy.unctad.org/international-investment-agreements">coverage of investment treaties</a>. Many of the fossil fuel reserves that need to <a href="https://carbontracker.org/terms/unburnable-carbon/">stay in the ground</a> and assets that need to be <a href="https://carbontracker.org/terms/stranded-assets/">stranded</a> in order for us to remain below 1.5C of warming are <a href="https://energymonitor.ai/policy/international-treaties/why-investor-lawsuits-could-slow-the-energy-transition">in the Global South</a>. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/380562/original/file-20210125-19-11gxy3j.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/380562/original/file-20210125-19-11gxy3j.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=555&fit=crop&dpr=1 600w, https://images.theconversation.com/files/380562/original/file-20210125-19-11gxy3j.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=555&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/380562/original/file-20210125-19-11gxy3j.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=555&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/380562/original/file-20210125-19-11gxy3j.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=697&fit=crop&dpr=1 754w, https://images.theconversation.com/files/380562/original/file-20210125-19-11gxy3j.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=697&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/380562/original/file-20210125-19-11gxy3j.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=697&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Number and percentage of foreign-owned coal plants protected by at least one treaty with investor-state dispute settlement (ISDS) in place, by host state.</span>
<span class="attribution"><a class="source" href="https://pubs.iied.org/sites/default/files/pdfs/migrate/17660IIED.pdf">(Kyla Tienhaara and Lorenzo Cotula)</a>, <span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>For example, a large number of planned and newly operating <a href="https://www.carbonbrief.org/mapped-worlds-coal-power-plants">coal-fired power plants</a> are in countries like Indonesia and Vietnam. A <a href="https://www.iied.org/international-treaties-threaten-affordability-climate-action-new-report">recent study</a> found that many of these plants are protected by investment treaties. These countries have fewer resources for fighting claims and a much poorer record of success in arbitration. </p>
<p>A real concern is that even the threat of a big investor claim <a href="https://www.cambridge.org/core/journals/transnational-environmental-law/article/regulatory-chill-in-a-warming-world-the-threat-to-climate-policy-posed-by-investorstate-dispute-settlement/C1103F92D8A9386D33679A649FEF7C84">could be enough to dissuade</a> one of these governments from taking action to phase out coal.</p>
<h2>A global solution</h2>
<p>We need climate action to happen everywhere, not just in the countries where governments can afford to fight legal challenges. This is one of the reasons why many are calling for radical reform or complete abolition of international investment treaties. </p>
<p>In Europe, campaigners are making headway on efforts <a href="https://www.climatechangenews.com/2020/10/28/eu-tries-stop-fossil-fuel-companies-suing-states-climate-action/">to remove protection for fossil fuel investments from the Energy Charter Treaty</a>. Countries like <a href="https://documents-dds-ny.un.org/doc/UNDOC/LTD/V19/072/51/PDF/V1907251.pdf?OpenElement">South Africa</a> are pushing for investment treaties to be aligned with the Paris Agreement and the UN’s Sustainable Development Goals. Researchers have also suggested that the problems with investment treaties could be addressed with a <a href="https://rooseveltinstitute.org/publications/green-new-deal-ten-year-window-to-reshape-international-economic-law/">Global Green New Deal</a>.</p>
<p>In the meantime, the Canadian public should make it clear to TC Energy and Jason Kenney that they should drop any plans to pursue a legal challenge, and own up to the fact that they alone are responsible for their own poor investment decisions.</p><img src="https://counter.theconversation.com/content/153814/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Kyla Tienhaara receives funding from the Government of Canada through the Canada Research Chair Program and through SSHRC. She occasionally collaborates on research projects with non-profit environmental organizations. </span></em></p>The threat of a large lawsuit could be enough to discourage some countries from taking action on climate change.Kyla Tienhaara, Canada Research Chair in Economy and Environment, Queen's University, OntarioLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1472472020-10-26T11:59:57Z2020-10-26T11:59:57ZTrump’s trade war – what was it good for? Not much<figure><img src="https://images.theconversation.com/files/365295/original/file-20201023-22-1qvl21w.jpg?ixlib=rb-1.1.0&rect=65%2C29%2C3928%2C2628&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">When you push an opponent, he tends to push back.
</span> <span class="attribution"><span class="source">AP Photo/Ahn Young-joon</span></span></figcaption></figure><p>The 2016 election was a <a href="https://fortune.com/2016/11/10/trump-voters-free-trade-globalization/">referendum on free trade</a>, which many blamed for destroying millions of American manufacturing jobs. In 2020, it could be about the merits of trade wars.</p>
<p>During President Donald Trump’s first term, he tore up deals, launched a trade war with China and renegotiated NAFTA. His campaign <a href="https://www.promiseskept.com/achievement/overview/foreign-policy/#">claims the war was a success</a> and that his policies <a href="https://www.cnn.com/2020/09/23/politics/fact-check-trump-jobs-manufacturing-coal/index.html">were bringing back manufacturing jobs</a> – until the pandemic arrived – and so voters should give him another four years.</p>
<p>His Democratic rivals disagree. </p>
<p>“You lost that trade war,” Sen. Kamala Harris snapped during her debate with Vice President Mike Pence, citing <a href="https://www.forbes.com/sites/rickhelfenbein/2020/10/12/senator-harris-on-trumps-china-strategy-you-lost-that-trade-war/#59e2780e3253">the loss of 300,000 manufacturing jobs</a> during Trump’s presidency and bankrupt farmers. </p>
<p>So who’s right?</p>
<p>As an <a href="https://www.bu.edu/gdp/profile/rebecca-ray/">economist who researches international economic policy</a>, I believe Trump’s impulse to rethink trade policy was understandable. If free trade hurt American workers, it stands to reason that putting up barriers to trade – even being willing to “go to war” – might protect those workers.</p>
<p>But wars can backfire – and trade wars are no different.</p>
<h2>Free trade’s losers</h2>
<p>Economic theory <a href="http://www.ilo.org/wcmsp5/groups/public/---dgreports/---dcomm/---publ/documents/publication/wcms_091038.pdf">tells us</a> that free trade means a greater availability of cheaper goods because everything will be produced where it can be made least expensively.</p>
<p>That sounds like a great deal for consumers and exporting industries like agriculture that find more buyers for their products. But it’s a raw deal for manufacturing workers as factories move to countries like Mexico and China with lower labor costs. </p>
<p>That’s what happened after the <a href="https://www.thebalance.com/nafta-pros-and-cons-3970481">North American Free Trade Agreement became law</a> in 1994 and <a href="https://www.marketwatch.com/story/chinas-entrance-into-wto-cost-us-34-million-jobs-new-study-finds-2018-10-23">China joined the World Trade Organization in 2001</a>.</p>
<p>In each case, <a href="https://fred.stlouisfed.org/series/MANEMP">manufacturing workers were among the big losers</a> as employment in the sector plunged from just under 18 million in 1990 to a little over 14 million in 2004.</p>
<h2>The tide turns against trade</h2>
<p>As a result, many politicians became more cautious about supporting free trade deals. </p>
<p>When he was a senator in 1993, former Vice President Joe Biden and many other Democrats <a href="https://www.bloomberg.com/news/articles/2019-05-14/biden-s-nafta-vote-is-a-liability-in-the-rust-belt">voted to ratify</a> NAFTA. A little over two decades later, when a free trade bill with Central America and the Dominican Republic came up for a vote, <a href="https://www.citizen.org/article/final-senate-vote-on-cafta/">Biden and nearly every Democrat voted no</a>. The bill barely passed. </p>
<p>And although Biden’s administration signed the <a href="https://www.cfr.org/backgrounder/what-trans-pacific-partnership-tpp">Trans-Pacific Partnership</a> in 2016 – which would have created the world’s largest free-trade zone – <a href="https://www.npr.org/sections/thetwo-way/2018/03/08/591549744/the-tpp-is-dead-long-live-the-trans-pacific-trade-deal">opposition among leading Democrats as well as Trump</a> imperiled its passage in the Senate, leading to the U.S.’s withdrawal in 2017. </p>
<p>When Trump launched his presidential campaign in 2016, <a href="https://time.com/4386335/donald-trump-trade-speech-transcript">opposition to trade deals</a> like NAFTA was one of his signature issues. At a time when Republican leaders mostly were staunch supporters of free trade, his promise to bring manufacturing jobs back to the U.S. <a href="https://www.newyorker.com/news/john-cassidy/how-donald-trump-won-the-g-o-p-nomination">helped him win</a> the primary – and <a href="https://fortune.com/2016/11/10/trump-voters-free-trade-globalization/">ultimately the presidency</a> – as a <a href="https://www.pewresearch.org/fact-tank/2016/03/31/republicans-especially-trump-supporters-see-free-trade-deals-as-bad-for-u-s/">growing number of voters</a> began to see trade as bad for Americans. </p>
<p>And as president, he followed through on his pledge and unilaterally imposed tariffs on a <a href="https://www.piie.com/blogs/trade-investment-policy-watch/trump-trade-war-china-date-guide">range of Chinese products</a> – a <a href="https://www.china-briefing.com/news/the-us-china-trade-war-a-timeline/">list that now totals US$550 billion worth</a> – as well as on most <a href="https://www.nytimes.com/2020/01/27/business/economy/trump-steel-tariffs.html">aluminum and steel</a> imports. Thus, Trump’s trade wars began.</p>
<p>My <a href="http://www.bu.edu/gdp/2020/09/15/how-trade-policy-failed-us-workers-and-how-to-fix-it">research</a> with colleagues at Boston University shows that trade agreements have indeed hurt U.S. workers. But Trump’s trade wars have not solved the offshoring problem that they were designed to fix.</p>
<h2>The trouble with trade wars</h2>
<p>Trump <a href="https://twitter.com/realDonaldTrump/status/969525362580484098">has claimed</a> “trade wars are good and easy to win.”</p>
<p>Trump seems to have based this on the assumption that America’s trading partners <a href="https://www.pbs.org/newshour/show/meet-the-trump-trade-adviser-whose-tariff-policy-is-about-to-be-tested">would not retaliate</a>. He was wrong.</p>
<p>Over many rounds of tit-for-tat, China <a href="https://www.piie.com/blogs/trade-investment-policy-watch/trump-trade-war-china-date-guide">has retaliated</a> repeatedly by placing tariffs on $185 billion of U.S. exports, <a href="https://theconversation.com/most-us-farmers-remain-loyal-to-trump-despite-pain-from-trade-wars-and-covid-19-146535">most notably agricultural products</a>. After U.S. soybean farmers saw their largest market dry up, the Trump administration was forced to <a href="https://www.card.iastate.edu/ag_policy_review/article/?a=103">spend $23 billion</a> to offset some of their losses. All told, more than <a href="https://www.reuters.com/article/usa-election-farmers-aid/trumps-payments-to-farmers-hit-all-time-high-ahead-of-election-idUKL1N2GT1C8">one-third</a> of farm income will come from government subsidies in 2020. </p>
<p>And when the Trump administration planned to impose steel tariffs on Canada earlier this year, <a href="https://www.bbc.com/news/business-54168420">America’s northern neighbor vowed retaliation</a>, which would have hurt U.S. exporters. So Trump backed down. </p>
<p>That’s the problem with trade wars. Intended to protect a country’s own workers, they wind up doing a lot of self-inflicted damage, as retaliatory tariffs drive up the cost of exports, hurting businesses and workers at home as well as abroad.</p>
<p>At the same time, U.S. policy seems to have lost sight of the original enemy: the offshoring of American jobs, which <a href="https://www.bloomberg.com/news/newsletters/2020-10-22/supply-chains-latest-the-hard-data-on-trump-s-offshoring-record">has continued to grow</a>. The <a href="https://www.nbcnews.com/politics/politics-news/trump-signs-tax-cut-bill-first-big-legislative-win-n832141">2017 tax cut</a>, for example, <a href="https://www.reuters.com/article/us-usa-tax-abbvie-idUSKBN1JE12Q">actually made offshoring more profitable</a> and attractive – making it even harder to achieve the primary goal of the trade war. </p>
<p>Trade wars pay off only if they have a clear vision and lead to meaningful changes in how everyone does business. That hasn’t happened either. </p>
<p>While Trump did reach a <a href="https://www.fas.usda.gov/topics/china-phase-one-agreement">“phase one” deal</a> with China in January, it actually looks like it will make the offshoring problem even worse. As part of the truce, the U.S. agreed to reduce its tariffs on Chinese goods and China said it would buy a lot more American products, especially soybeans. </p>
<p>While it may make up for some of the damage caused by the trade war – such as by aiding ailing soybean farmers – it will make offshoring easier by making it more advantageous and profitable for American companies to transfer operations to China. That’s because China also agreed to stop requiring foreign companies that seek to do business within its borders to transfer technology to domestic partners.</p>
<h2>A better way to protect workers</h2>
<p>One notable exception to all this is the <a href="https://ustr.gov/trade-agreements/free-trade-agreements/united-states-mexico-canada-agreement">U.S.-Mexico-Canada Agreement</a>, Trump’s replacement for NAFTA that became law in July.</p>
<p>That deal is likely to prevent more offshoring to Mexico because of bipartisan support for <a href="https://www.cnbc.com/2019/12/10/house-democrats-and-trump-administration-reach-usmca-trade-deal.html">labor and environmental provisions</a> that raise minimum Mexican automaker wages. </p>
<p>[<em>Deep knowledge, daily.</em> <a href="https://theconversation.com/us/newsletters/the-daily-3?utm_source=TCUS&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=deepknowledge">Sign up for The Conversation’s newsletter</a>.]</p>
<p>This points to one of the best ways to actually stop manufacturing offshoring: Negotiate trade agreements that set <a href="https://www.globaltrademag.com/laboring-for-trade/">higher labor and environmental standards</a> for all signatories. This not only helps workers and communities in other countries get better treatment, but also makes U.S. workers more competitive by raising the cost of doing business there. That makes American companies less likely to move operations overseas.</p>
<p>The evidence suggests the best way to limit offshoring is through negotiation and cooperation, not war.</p><img src="https://counter.theconversation.com/content/147247/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Rebecca Ray receives funding from the MacArthur Foundation, the Rockefeller Brothers Fund, the David and Lucile Packard Foundation, the Climate and Land Use Alliance, the The National Socio-Environmental Synthesis Center, the International Institute for Sustainable Development, and the Groundwork Collaborative.</span></em></p>Trump launched his trade war to save American manufacturing. An economist explains why it hasn’t worked out as planned.Rebecca Ray, Senior Academic Researcher, Boston UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1463842020-09-24T14:52:12Z2020-09-24T14:52:12ZFree trade 2.0: How USMCA does a better job than NAFTA of protecting the environment<figure><img src="https://images.theconversation.com/files/359189/original/file-20200921-14-fv7324.jpg?ixlib=rb-1.1.0&rect=2%2C0%2C1351%2C667&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Then-president of Mexico Enrique Pena Nieto, U.S. President Donald Trump and Prime Minister Justin Trudeau sign the new Canada-U.S.-Mexico Agreement in Buenos Aires, Argentina. The agreement was ratified in April 2020 and came into force last July. </span> <span class="attribution"><span class="source">The Canadian Press</span></span></figcaption></figure><p>Against a backdrop of clashes in Congress and with presidential election campaigns deepening the political divide in the United States, it may feel as though environmental issues are no longer part of the political discussion. The new North American Free Trade Agreement, however, has given environmental standards a boost.</p>
<p>The July 1 ratification of the <a href="https://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/cusma-aceum/index.aspx?lang=eng">United States-Mexico-Canada Agreement</a>, known as the USMCA or the new NAFTA, marked the end of tumultuous negotiations that included the contentious issue of environmental standards.</p>
<p>By putting the environment on the political agenda, the government of Canada placed environmental standards back on the table, even though the issue is not a priority for Donald Trump’s administration.</p>
<p>As a researcher at the Centre d'études sur l'intégration et la mondialisation at the Université du Québec à Montréal, I am interested in how economic power relations shape North American free trade negotiations amid tensions between the United States and its major trading partners.</p>
<h2>Democratic majority pushes issue</h2>
<p>Prior to the negotiation of USMCA, both the left and the auto-sector unions in the United States regularly accused Mexico of <a href="https://www.nytimes.com/2019/12/30/world/americas/mexico-environment-trade.html">illegal waste dumping</a> and “<a href="https://ieim.uqam.ca/IMG/pdf/ARES-IDEDEV-jan2009.pdf">social dumping</a>,” exploiting wage differences between countries to avoid high labour costs. Mexico, in turn, denounced Trump’s anti-NAFTA political discourse. </p>
<p>Mexico was criticized for applying lower environmental and labour standards than its North American partners to maintain a competitive advantage and attract foreign direct investment in its auto industry. This rhetoric took on particular significance in the anti-NAFTA campaign led by Donald Trump, <a href="https://www.reuters.com/article/us-usa-election-idUSKCN0ZE0Z0">first as a presidential candidate in 2016</a> and then <a href="https://www.npr.org/2018/10/01/653203765/u-s-and-canada-reach-deal-to-replace-nafta">as president</a>.</p>
<p>Following the November 2018 midterm elections, which brought a Democratic majority to the House of Representatives, environmental issues became important again. This provided an opportunity to strengthen the presence of environmental standards as the trade deal was renegotiated and ratified.</p>
<h2>Better than NAFTA</h2>
<p>A full chapter of the USMCA deals specifically with environmental issues — a clear innovation compared to NAFTA. It introduces an article (Article 24.8) that refers to seven ratified multilateral environmental agreements (MEAs), and explicitly obliges the signatories to respect these commitments.</p>
<p>MEAs are side agreements signed by NAFTA state parties with other countries to strengthen environmental protection standards in their free-trade relations. This is the first time in North America that a free-trade agreement integrates the environmental commitments made by its signatories.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/357287/original/file-20200909-16-1l2kru0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/357287/original/file-20200909-16-1l2kru0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=399&fit=crop&dpr=1 600w, https://images.theconversation.com/files/357287/original/file-20200909-16-1l2kru0.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=399&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/357287/original/file-20200909-16-1l2kru0.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=399&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/357287/original/file-20200909-16-1l2kru0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=502&fit=crop&dpr=1 754w, https://images.theconversation.com/files/357287/original/file-20200909-16-1l2kru0.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=502&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/357287/original/file-20200909-16-1l2kru0.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=502&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Extracting oil from an oil field in Kern County, Calif. About 15 billion barrels of oil could be extracted by hydraulic fracturing in the state.</span>
<span class="attribution"><span class="source">(Shutterstock)</span></span>
</figcaption>
</figure>
<p>USMCA was negotiated during the development of the U.S. shale gas industry, pipeline extensions — and protests by Indigenous people — in Canada and increased investment in oil and gas exploration in Mexico. USMCA, unlike NAFTA, <a href="https://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/cusma-aceum/enviro.aspx?lang=eng">introduces new environmental commitments</a> for improving air quality and reducing marine litter.</p>
<h2>Canadian standards take precedence</h2>
<p>The USMCA affirms the right of each party to set and enforce environmental protection standards at the national level. For example, in Canada, the more inclusive Canadian Environmental Protection Act of 1999 (CEPA) takes precedence over the Ozone-depleting Substances and Halocarbon Alternatives Regulations. </p>
<p>The issue of environmental standards is of particular importance to Canada as it relates to <a href="https://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/cusma-aceum/investment-investissement.aspx?lang=eng">investor-state dispute settlement (ISDS)</a>, a major item on the U.S. negotiating agenda.</p>
<p>Foreign investors have repeatedly sued Canada using the ISDS mechanism, on issues that largely related to the strengthening of environmental protection laws. As a result, Canada has <a href="https://www.policyalternatives.ca/sites/default/files/uploads/publications/National%20Office/2018/01/NAFTA%20Dispute%20Table%20Report%202018.pdf">paid more than $300 million in damages to U.S. investors</a>. This situation also made it difficult for Canada and the provinces to update and enforce their environmental regulations. </p>
<p>The USMCA negotiation provided Canada with the opportunity to end the unfavourable investor-state arbitration mechanism. From now on, it will be up to Canadian courts to rule on disputes between U.S. investors and Canada over damages suffered as a result of changes to Canadian laws, including environmental legislation. </p>
<h2>Recognition of the role of Indigenous peoples</h2>
<p>The <a href="https://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/cusma-aceum/initial_ea-ee_initiale.aspx?lang=eng">environment</a> took on a major technical, political and ideological importance in the negotiations following demands by the Democratic majority in Congress, something that affected not only the bargaining process but the ratification as well.</p>
<p>This <a href="https://ipolitics.ca/2020/01/16/u-s-senate-passes-usmca-only-canada-left-to-ratify/">strengthened key aspects of the federal government’s negotiating strategy</a>, allowing it to pursue efforts that reflected Canada’s progressive agenda, including the recognition of the role of Indigenous people in the preservation of biodiversity.</p>
<p>In the end, it means that free trade will have be more sensitive to the effects of climate change and accommodate environmental protection as an essential element of regulatory co-operation, no matter how it evolves during any integration of the North American economy.</p><img src="https://counter.theconversation.com/content/146384/count.gif" alt="La Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Brice Armel Simeu ne travaille pas, ne conseille pas, ne possède pas de parts, ne reçoit pas de fonds d'une organisation qui pourrait tirer profit de cet article, et n'a déclaré aucune autre affiliation que son organisme de recherche.</span></em></p>The Canada-U.S.-Mexico Free Trade Agreement, which came into force in July 2020, puts more emphasis on the environment and gives greater authority in Canada in the matter.Brice Armel Simeu, Doctorant en Économie politique internationale, Chercheur au Centre d'Études sur l'Intégration et la Mondialisation (CEIM), Université du Québec à Montréal (UQAM)Licensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1361612020-05-07T14:04:26Z2020-05-07T14:04:26ZCanada needs to see the U.S. and its trade motives clearly<figure><img src="https://images.theconversation.com/files/331964/original/file-20200501-42942-1aperbf.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C4974%2C3179&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">U.S. President Donald Trump speaks during a meeting with Prime Minister Justin Trudeau in London in December 2019.</span> <span class="attribution"><span class="source">(AP Photo/ Evan Vucci)</span></span></figcaption></figure><p>Existential crises that threaten one’s entire society have a way of forcing us to see the world as it truly is. The coronavirus pandemic is no exception. Canada, once mocked by <em>South Park</em> as “<a href="https://youtu.be/bOR38552MJA">not even a real country anyway</a>,” has come together in remarkable fashion. Canadians and their leaders, from every region and across the political spectrum, are all pushing in the same direction.</p>
<p>But while the pandemic has showcased the country’s inspiring cohesiveness, it has also revealed the tragic costs, measured in lives lost and economic opportunity squandered, of Canada’s continued adherence to a one-dimensional ideology that long ago passed its best-before date.</p>
<p>Since the 1990s, Canadian economic development policy has been anchored in two words: free trade. The previously widely accepted notion that countries should have an industrial policy — a strategy for encouraging strong and desirable economic growth — was cast aside in the single-minded pursuit of comprehensive trade agreements. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/331960/original/file-20200501-42942-1ytj0g5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/331960/original/file-20200501-42942-1ytj0g5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=472&fit=crop&dpr=1 600w, https://images.theconversation.com/files/331960/original/file-20200501-42942-1ytj0g5.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=472&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/331960/original/file-20200501-42942-1ytj0g5.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=472&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/331960/original/file-20200501-42942-1ytj0g5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=593&fit=crop&dpr=1 754w, https://images.theconversation.com/files/331960/original/file-20200501-42942-1ytj0g5.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=593&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/331960/original/file-20200501-42942-1ytj0g5.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=593&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Standing from left, Mexico’s Carlos Salinas de Gortari, George H. W. Bush of the United States and Canada’s Brian Mulroney are all smiles standing behind their trade representatives as they sign the North American Free Trade Agreement in San Antonio in 1992.</span>
<span class="attribution"><span class="source">(AP PHOTO/Pat Sullivan)</span></span>
</figcaption>
</figure>
<p>Economic security and prosperity, so the conventional wisdom held, was best ensured by lowering trade barriers and encouraging specialization. Production would be global, which wouldn’t pose any problems in a free-trade world.</p>
<h2>Two flaws</h2>
<p>There have long been two flaws in this policy. First, while Canada may be “<a href="https://www.ubcpress.ca/a-trading-nation">a trading nation</a>,” trade is merely a means to an end: securing markets for Canadian producers and ensuring Canadians’ access to foreign goods and services. At the end of the day, it’s production, not trade, that matters most for a country’s economic security and power.</p>
<p>Second, policy-makers failed to appreciate the extent to which the entire free-trade world was dependent on the actions and support of the United States given its global superpower status. After the Second World War, the U.S. decided to underwrite a liberal multilateral order that encouraged free trade, which it was able to reinforce in the 1990s after the end of the Cold War. </p>
<p>For a long while in the 1990s, Canada was able to get away with neglecting industrial policy and to imagine that free trade would be our economic salvation. This was because the world of open borders, ostensibly supported by U.S. power, hid the long-term costs of de-industrialization since we still had easy access to cheap production in other countries.</p>
<p>Unfortunately for Canada, that world hasn’t existed for almost 20 years. The multilateral free-trade world was only ever as resilient as the American commitment to it. </p>
<p>The unilateral U.S. choice of security over prosperity following the 9/11 terrorist attacks was the beginning of the end of this multilateral economic order. The unsanctioned <a href="https://www.britannica.com/event/Iraq-War">American invasion of Iraq</a> hastened the system’s decline, as did its <a href="https://www.cnn.com/2013/10/30/world/meast/iraq-prison-abuse-scandal-fast-facts/index.html">open embrace of torture</a> in contravention of international conventions and basic human decency.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/331961/original/file-20200501-42903-1xjmre7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/331961/original/file-20200501-42903-1xjmre7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=296&fit=crop&dpr=1 600w, https://images.theconversation.com/files/331961/original/file-20200501-42903-1xjmre7.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=296&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/331961/original/file-20200501-42903-1xjmre7.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=296&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/331961/original/file-20200501-42903-1xjmre7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=372&fit=crop&dpr=1 754w, https://images.theconversation.com/files/331961/original/file-20200501-42903-1xjmre7.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=372&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/331961/original/file-20200501-42903-1xjmre7.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=372&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">A U.S. Customs canine enforcement officer and his dog examine a line of cars entering the United States from Canada at the inspection station near Blaine, Wash., in August 2003, part of increased border security measures following 9/11.</span>
<span class="attribution"><span class="source">(AP Photo/Ted S. Warren)</span></span>
</figcaption>
</figure>
<p>Less dramatically, U.S. economic policy, under Democrats and Republicans alike, turned trade agreements from potentially win-win tariff-lowering treaties into agreements designed to <a href="https://www.theglobeandmail.com/report-on-business/tpp-is-about-many-things-but-free-trade-not-so-much/article27169740/">lock in the American advantage</a> on issues of the future: intellectual property, <a href="https://www.cigionline.org/articles/data-not-treaty-ready-and-cusma-not-data-ready">data governance</a> and internet governance. Free trade agreements are no longer about free trade.</p>
<h2>COVID-19 exposes the cracks</h2>
<p>All this happened before the pandemic exposed the physical vulnerability of countries lacking guaranteed access to producers of medical equipment. The current international scramble for medical equipment is not causing the world order to collapse: it’s a symptom of an order that has been falling apart in slow motion for a long while.</p>
<p>Countries have been tentatively, almost unconsciously, adjusting to this reality. These include forms of what I call digital economic nationalism, in which countries, <a href="https://www.ic.gc.ca/eic/site/093.nsf/eng/00008.html">including Canada</a>, are pursuing national industrial policies in high-tech areas <a href="https://ec.europa.eu/knowledge4policy/ai-watch/germany-ai-strategy-report_en">like artificial intelligence</a> and are seriously considering <a href="https://www.bbc.com/news/technology-47135058">the regulation</a> of global, mostly American, online platforms.</p>
<p>Still, <em>tentatively</em> is the operative word. Policy continues to be marked by a failure to think through the consequences of these long-term trends, and by the hope that U.S. President Donald Trump’s eventual departure from the Oval Office will restore the multilateral order. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/331973/original/file-20200501-42962-9zn1mz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/331973/original/file-20200501-42962-9zn1mz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=414&fit=crop&dpr=1 600w, https://images.theconversation.com/files/331973/original/file-20200501-42962-9zn1mz.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=414&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/331973/original/file-20200501-42962-9zn1mz.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=414&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/331973/original/file-20200501-42962-9zn1mz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=520&fit=crop&dpr=1 754w, https://images.theconversation.com/files/331973/original/file-20200501-42962-9zn1mz.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=520&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/331973/original/file-20200501-42962-9zn1mz.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=520&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Trump is seen in the Oval Office in January 2018. His eventual departure isn’t likely to result in changed American attitudes about bilateral trade.</span>
<span class="attribution"><span class="source">(AP Photo/Carolyn Kaster)</span></span>
</figcaption>
</figure>
<p>It won’t, for the simple reason that there is no longer a political bipartisan consensus on Capitol Hill that this order is worth saving. The liberal, multilateral world order that has been underwritten by the United States since the end of the Second World War cannot survive this degree of instability for very long.</p>
<p>Canada’s free-trade obsession has put us in a bind, making us overly reliant on global supply chains. That’s a huge unforced error given that 19 years ago, 9/11 showed us just how quickly border policy can change.</p>
<p>The recently concluded NAFTA 2.0, officially known as the U.S.-Mexico-Canada trade agreement (USMCA), has <a href="https://theconversation.com/nafta-has-been-replaced-but-at-what-cost-to-canada-104174">myriad</a> <a href="https://www.cbc.ca/news/politics/nafta-economic-impact-analysis-1.5477542">loopholes</a> that leave Canada open to future harassment and <a href="http://www.michaelgeist.ca/2020/02/we-dont-have-any-specific-analysis-cusma-negotiators-surprising-admission-on-key-privacy-issues/">concessions on data localization made without any analysis on their impact</a>. It also illustrates Canada hasn’t fully comprehended how the world has transformed since 1994. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/nafta-has-been-replaced-but-at-what-cost-to-canada-104174">NAFTA has been replaced, but at what cost to Canada?</a>
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<p>Policy-makers could well find that the USMCA, purpose-built for a world that no longer exists, severely restricts their ability to set a production-focused policy appropriate for 2020 and beyond.</p>
<p>Still, acknowledging reality is the first step in dealing with a crisis. The post-Second World War order is gone. Trade policy must be put in its proper place, a component — but not the entire game — of a comprehensive, government-led domestic industrial policy that involves actual, production-focused planning for a world in which the conventional wisdom of the past 70 years no longer holds. </p>
<p>Just signing trade agreements is no longer enough to ensure Canadian prosperity. We have to deal with the world as it is, not as we wish it would be.</p><img src="https://counter.theconversation.com/content/136161/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Blayne Haggart receives funding from the Social Sciences and Humanities Research Council of Canada.</span></em></p>Canada’s free-trade obsession has made us overly reliant on global supply chains. That’s a huge unforced error given that 19 years ago, 9/11 showed us just how quickly border policy can change.Blayne Haggart, Associate Professor of Political Science, Brock UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1309702020-02-05T22:09:37Z2020-02-05T22:09:37ZCanada-U.K. free trade: A post-Brexit opportunity<figure><img src="https://images.theconversation.com/files/313740/original/file-20200205-149752-11ee8av.jpg?ixlib=rb-1.1.0&rect=0%2C184%2C4075%2C2504&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Prime Minister Justin Trudeau meets with U.K. Prime Minister Boris Johnson during the G7 Summit in Biarritz, France, in August 2019. Can the U.K. and Canada forge a post-Brexit trade deal?</span> <span class="attribution"><span class="source">THE CANADIAN PRESS/Sean Kilpatrick</span></span></figcaption></figure><p>The hard work now begins for the United Kingdom to shape an independent trade policy outside of the European Union. Brexit has finally happened after more than three years of negotiations, posturing, parliamentary shenanigans, two elections and considerable policy uncertainty.</p>
<p>As the <a href="https://www.nytimes.com/2020/02/03/world/europe/after-brexit.html"><em>New York Times</em></a> reports, the U.K. faces complex and arduous negotiations trying to maintain its privileged access to 450 million European consumers with zero tariffs or other trade restrictions. </p>
<p>It’s crucial for the U.K. to negotiate and sign some sort of trade agreement with the EU as soon as possible because the transitional period ends on Dec. 31, 2020. After that date if there are no deals, the British will lose their preferential access to that important market. This will significantly disrupt trade flows and supply chains that are vital to the U.K. economy.</p>
<p>Unfortunately, that’s a very short time to negotiate a deal. Trade deals typically <a href="https://voxeu.org/article/why-do-trade-negotiations-take-so-long">take more than two years to hammer out</a>.</p>
<h2>Deal with U.S.?</h2>
<p>The EU is critical but the U.K. is also looking to sign trade deals with other countries — perhaps none more important for the British economy than one with the United States. </p>
<p>But a deal with the Americans is at best a few years away and will not come easy, even though the U.S. is an important partner for the U.K. and there has been a lot of <a href="https://www.independent.co.uk/topic/uk-us-trade-deal">discussion about such a deal</a>.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/a-quick-british-american-trade-deal-nafta-suggests-not-a-chance-87708">A 'quick' British-American trade deal? NAFTA suggests not a chance</a>
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<p>There are many significant road blocks to such a deal — Donald Trump’s administration <a href="https://www.piie.com/blogs/trade-investment-policy-watch/protectionism-under-trump-policy-identity-and-anxiety">is more about protectionism</a> than it is about trade agreements, and it will be extremely difficult to negotiate as the president focuses on re-election. Witness the tumultuous and prolonged negotiations over <a href="https://www.macleans.ca/news/canada/nafta-lives-canada-and-the-u-s-reach-an-11th-hour-a-deal/">minor improvements to the NAFTA agreement</a>.</p>
<p>Even if Trump is defeated in November, the Americans have not been able to negotiate a deal with the EU. Talks started in 2013 and <a href="https://www.npr.org/sections/thetwo-way/2016/08/28/491721332/german-official-says-u-s-europe-trade-talks-have-collapsed-blames-washington">were suspended in 2016</a>. The lack of results stemmed from challenges on both sides but does not bode well for a desperate and less economically powerful U.K. to be able to make headway with the U.S.</p>
<h2>Losing preferential access</h2>
<p>Meanwhile, the U.K. has other important trade policy challenges to resolve. Not only do the British lose privileged access to the EU on Dec. 31, but they also lose preferential access to all the countries and trading blocks with which the EU currently has agreements. </p>
<p>The EU has trade deals fully implemented, or partially in place, with <a href="https://ec.europa.eu/trade/policy/countries-and-regions/negotiations-and-agreements/#_being-negotiated">88 countries</a>, including Canada. Many of these agreements are with small economies, but the point is that due to Brexit, the U.K. will lose all the preferential access it’s enjoyed as a member of the EU. </p>
<p>The U.K. must negotiate agreements with these 88 countries simply to maintain its current trade relationship.</p>
<p>But British officials don’t have experience or capacity to effectively negotiate multiple new trade agreements and will already have their hands full negotiating with the EU. This is where Canada comes in. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/313753/original/file-20200205-149772-12vtbit.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/313753/original/file-20200205-149772-12vtbit.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/313753/original/file-20200205-149772-12vtbit.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/313753/original/file-20200205-149772-12vtbit.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/313753/original/file-20200205-149772-12vtbit.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/313753/original/file-20200205-149772-12vtbit.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/313753/original/file-20200205-149772-12vtbit.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">British Prime Minister Boris Johnson, Canada’s Justin Trudeau and Germany’s Angela Merkel are seen at the G7 summit in France in August 2019.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Sean Kilpatrick</span></span>
</figcaption>
</figure>
<p>Canada has an important and comprehensive agreement with the EU <a href="https://www.policyschool.ca/wp-content/uploads/2019/11/TradePolicyTrends.Beaulieudylanklemen-final.pdf">called CETA</a>, short for the Canada-European Union Comprehensive Economic and Trade Agreement. CETA is a cutting-edge and modern trade agreement that is comprehensive in its coverage. It also contains progressive commitments to promote labour rights, environmental protection and sustainable development. </p>
<h2>A perfect template</h2>
<p>CETA provides the perfect template for the U.K. to adopt and use as a model for future bilateral agreements after finalizing a free-trade agreement with Canada.</p>
<p>Obviously, the U.K. urgently needs to complete a deal with the EU first and foremost. But a deal with Canada should be its second priority. Not only can CETA provide a model for a <a href="https://www.theglobeandmail.com/business/article-ceta-can-serve-as-template-for-post-brexit-canada-uk-trade-deal/">U.K.-EU deal</a>, it can also be the template for the Canada-U.K. deal.</p>
<p>The U.K. can get an early and relatively easy win by completing a new trade agreement with Canada. The two countries, in fact, have already agreed informally to move forward on a Canada-U.K. agreement built on CETA.</p>
<p>Along with Dylan Klemen of the University of Calgary’s School of Public Policy, I have argued that <a href="https://www.policyschool.ca/wp-content/uploads/2019/07/Trade-Policy-Trends-Brexit-final.pdf">this would be an important win for Canadian trade policy as well</a>. The U.K. is Canada’s fifth largest trading partner, and was its largest trading partner when it remained in the EU. The U.K. is Canada’s second largest source of foreign direct investment, and the second largest foreign destination for Canadian investors.</p>
<p>The <a href="https://www.policyschool.ca/wp-content/uploads/2019/07/Trade-Policy-Trends-Brexit-final.pdf">following graphic</a> shows Canada’s 10 most valuable exports (in terms of product groups) to the U.K. over the last five years. Exports of gold are sizably larger than Canada’s other top exports to the country. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/313826/original/file-20200205-149796-1mlv182.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/313826/original/file-20200205-149796-1mlv182.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=472&fit=crop&dpr=1 600w, https://images.theconversation.com/files/313826/original/file-20200205-149796-1mlv182.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=472&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/313826/original/file-20200205-149796-1mlv182.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=472&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/313826/original/file-20200205-149796-1mlv182.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=593&fit=crop&dpr=1 754w, https://images.theconversation.com/files/313826/original/file-20200205-149796-1mlv182.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=593&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/313826/original/file-20200205-149796-1mlv182.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=593&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Canada-U.K. trade statistics.</span>
<span class="attribution"><span class="source">(Eugene Beaulieu)</span>, <span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>With Brexit, Canada lost one of its key objectives in signing CETA in the first place — free trade with the U.K. </p>
<p>Prime Minister Justin Trudeau began informal discussions on free trade with <a href="https://www.cbc.ca/news/politics/canada-uk-trade-talks-brexit-vote-1.4973281">former British prime minister Teresa May</a>, and <a href="https://www.thestar.com/news/canada/2020/01/31/justin-trudeau-predicts-orderly-brexit-minimal-trade-and-investment-disruption.html">recently confirmed his commitment</a> to a trade agreement between the two countries under Boris Johnson. </p>
<h2>Easy to complete?</h2>
<p>For Canadian trade policy, there is another reason to move quickly with a CETA-based agreement with the U.K. — and another reason to believe the agreement will be easy to complete. And that’s the opportunity <a href="https://www.policyschool.ca/wp-content/uploads/2019/12/final_Canada-UK-Trade-Beaulieu-Dawar-GarnerKnapp.pdf">for Canada to move forward with its diversification strategy and achieve its progressive trade objectives</a>. </p>
<p>The U.K. and Canada should quickly negotiate a free-trade deal with strong environmental and labour provisions modelled closely after CETA.</p>
<p>Free trade with Canada provides an early and relatively straightforward win for the U.K. as well as a win for Canada’s trade diversification strategy and progressive trade agenda. It’s also important that both countries complete a deal to avoid disruptions to the flows of trade and commerce between the two countries. </p>
<p>Meanwhile, the U.K. can use CETA as a template for its own negotiations with the EU. Such a template could be a model for future negotiations with the long list of countries with whom it will be trying to ensure continued market access.</p><img src="https://counter.theconversation.com/content/130970/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Eugene Beaulieu receives funding from SSHRC and ESRC.</span></em></p>The U.K. is now in the unenviable position of having to negotiate multiple trade deals following Brexit. Here’s why it should start with Canada.Eugene Beaulieu, Professor, Economics, University of CalgaryLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1290392019-12-20T04:49:59Z2019-12-20T04:49:59ZImpeachment overkill, the USMCA’s impact on jobs and the power of imagery: 3 quotes from the Democratic debate, explained<figure><img src="https://images.theconversation.com/files/308048/original/file-20191220-11929-1luq2u9.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Seven democratic candidates convened in Los Angeles for a debate.</span> <span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Election-2020-Debate/b8439deeea29464fb7cc977b1577ddf9/5/0">AP Photo/Chris Carlson</a></span></figcaption></figure><p><em>Editor’s note: The seven Democrats who qualified for the final Democratic presidential debate of 2019 <a href="https://www.nytimes.com/2019/12/19/us/politics/democratic-debate-live.html?login=email&auth=login-email">sparred over the economy</a>, trade, social justice and many other issues – including <a href="https://www.nytimes.com/2019/12/19/us/politics/wine-cave.html">“wine caves.”</a> We asked three scholars to watch the Dec. 19 debate, held at Loyola Marymount University in Los Angeles, and <a href="https://www.washingtonpost.com/politics/2019/12/20/transcript-december-democratic-debate/">pick a quote</a> from one of the candidates to highlight and analyze.</em></p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/308049/original/file-20191220-11914-w20zl1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/308049/original/file-20191220-11914-w20zl1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=407&fit=crop&dpr=1 600w, https://images.theconversation.com/files/308049/original/file-20191220-11914-w20zl1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=407&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/308049/original/file-20191220-11914-w20zl1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=407&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/308049/original/file-20191220-11914-w20zl1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=511&fit=crop&dpr=1 754w, https://images.theconversation.com/files/308049/original/file-20191220-11914-w20zl1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=511&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/308049/original/file-20191220-11914-w20zl1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=511&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Yang said candidates should stop talking about impeachment.</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Election-2020-Debate/89f6f6a10c824479a5721bb786e7b250/6/0">AP Photo/Chris Carlson</a></span>
</figcaption>
</figure>
<p><strong>Sarah Burns, RIT</strong></p>
<blockquote>
<p>“It’s clear why Americans can’t agree on impeachment. We’re getting news from different sources and … Americans don’t trust the media networks to tell them the truth.” - Andrew Yang</p>
</blockquote>
<p>Yang makes a very good point. If you look at <a href="https://projects.fivethirtyeight.com/trump-approval-ratings/">President Donald Trump’s approval ratings</a> and the <a href="https://projects.fivethirtyeight.com/impeachment-polls/">national opinion on impeachment</a>, they have been extremely steady. </p>
<p>That’s because American citizens see very different versions of the country depending on where they get their news. If they are reading and watching, say, <a href="https://www.marketwatch.com/story/how-biased-is-your-news-source-you-probably-wont-agree-with-this-chart-2018-02-28">the New York Times and the Washington Post</a>, there are clear reasons to support impeachment. For example, Trump <a href="https://www.nytimes.com/2019/09/20/us/politics/trump-whistle-blower-ukraine.html">asked a foreign leader to look into a political rival</a>.</p>
<p>If they are consuming news on the other end of the ideological spectrum from sources <a href="https://www.foxnews.com/politics/impeachment-debate-floor">like Fox News</a>, Trump either did not do anything wrong — as Mick Mulvaney quipped, “<a href="http://nymag.com/intelligencer/2019/10/mulvaney-ukraine-get-over-it.html">Get over it</a>” – or he did something wrong but it falls below the level of impeachment.</p>
<p>The discussion about what, if anything, he did wrong has stalled out. Furthermore, <a href="https://www.politico.com/news/2019/12/19/democratic-debate-live-stream-watch-online-086513">as Yang points out</a>, we know the score of the ballgame. </p>
<p>The senate needs <a href="https://heavy.com/news/2019/09/impeachment-process-how-many-votes-to-impeach-trump/">67 “yes” votes</a> to convict the president of impeachable offenses. That means at least 20 Republicans would have to break ranks with Senate Majority Leader, Mitch McConnell, to impeach a president of their own party.</p>
<p>How they vote may very well depend on where their constituents get their news. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/308051/original/file-20191220-11900-18wqvea.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/308051/original/file-20191220-11900-18wqvea.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=418&fit=crop&dpr=1 600w, https://images.theconversation.com/files/308051/original/file-20191220-11900-18wqvea.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=418&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/308051/original/file-20191220-11900-18wqvea.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=418&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/308051/original/file-20191220-11900-18wqvea.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=526&fit=crop&dpr=1 754w, https://images.theconversation.com/files/308051/original/file-20191220-11900-18wqvea.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=526&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/308051/original/file-20191220-11900-18wqvea.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=526&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Sanders said he’s vote against the USMCA.</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Election-2020-Debate/5802910e03b8414cb45abf81d690803e/2/0">AP Photo/Chris Carlson</a></span>
</figcaption>
</figure>
<p><strong>Stephen Onyeiwu, Allegheny College</strong></p>
<blockquote>
<p>“It is not going to stop outsourcing. It is not going to stop corporations from moving to Mexico, where manufacturing workers make less than $2 an hour. What we need is a trade policy that stands up for workers, stands up for farmers… So, no, I will not be voting for this agreement.” - Vermont Sen. Bernie Sanders</p>
</blockquote>
<p>I believe Sanders is right in his characterization of <a href="https://theconversation.com/usmca-the-3-most-important-changes-in-the-new-nafta-and-why-they-matter-128735">Trump’s new trade deal</a> with Mexico and Canada – and, in fact, he may be foreshadowing trouble over its passage in the Senate. </p>
<p>The United States Mexico Canada Agreement, or USMCA, as the trade deal is known, has been described by Speaker Nancy Pelosi as a “<a href="https://www.cnbc.com/2019/12/19/house-passes-trumps-usmca-trade-agreement.html">jobs bill</a>.”</p>
<p>By requiring most workers who build vehicle parts to earn at least $16 an hour and enforcing tougher labor standards for Mexican workers, the <a href="https://www.lehighvalleylive.com/opinion/2019/09/usmca-will-help-union-workers-discourage-outsourcing-of-jobs-opinion.html">USMCA is expected</a> to discourage outsourcing from U.S. and therefore create jobs in the country.</p>
<p>But this argument glosses over a key dynamic in U.S. manufacturing: <a href="http://www.themanufacturinginstitute.org/%7E/media/E323C4D8F75A470E8C96D7A07F0A14FB/DI_2018_Deloitte_MFI_skills_gap_FoW_study.pdf">the acute shortages of skilled workers in the sector</a>. The problem is not the lack of jobs, but the fact that manufacturers can’t find skilled workers to employ. That’s why U.S. companies have resorted to automation and outsourcing to other countries – and why the USMCA is unlikely to lead to more jobs in the U.S. </p>
<p>Demanding Mexican companies pay higher wages <a href="https://www.washingtonpost.com/business/economy/trumps-usmca-trade-agreement-would-have-a-limited-but-positive-impact-on-us-economy-report-finds/2019/04/18/b8ccb48c-6200-11e9-9ff2-abc984dc9eec_story.html">will likely increase production costs</a> for U.S. manufacturers in a variety of industries, from automotive and aerospace to electronics and chemicals. And these higher costs would then be passed on to American consumers, which would reduce real purchasing power and lower living standards. </p>
<p>More ominously, it could make American manufactured goods less competitive in global markets. The long-term effects would include falling exports, fewer jobs and slower economic growth. </p>
<p>Although the USMCA <a href="https://www.washingtonpost.com/us-policy/2019/12/19/house-passes-reworked-north-american-trade-deal-victory-trump-democrats/">sailed through the House</a>, it may have more trouble in the Senate, where it will need 60 votes – including at least 7 Democrats or independents. Although many expect the deal to clear that hurdle in 2020, the opposition of Sanders as a top candidate for president may be a warning sign that things won’t be so smooth. </p>
<p>Besides challenges getting Democrats on board, there’s the unpredictability of moderate Republicans like Susan Collins and Mitt Romney as well as <a href="https://www.usnews.com/news/the-report/articles/2019-12-13/usmca-trade-deal-wins-over-democrats-but-faces-2020-uncertainty">others who don’t like the concessions to Democrats</a>. It’s possible the more we learn about the impact of the trade deal, the more opposition from senators in affected states will grow. The tone and outcome of Trump’s impeachment trial may have an impact as well. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/308050/original/file-20191220-11929-61xq8h.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/308050/original/file-20191220-11929-61xq8h.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=392&fit=crop&dpr=1 600w, https://images.theconversation.com/files/308050/original/file-20191220-11929-61xq8h.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=392&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/308050/original/file-20191220-11929-61xq8h.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=392&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/308050/original/file-20191220-11929-61xq8h.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=492&fit=crop&dpr=1 754w, https://images.theconversation.com/files/308050/original/file-20191220-11929-61xq8h.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=492&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/308050/original/file-20191220-11929-61xq8h.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=492&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Klobuchar referenced former President James Madison – and his height.</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Election-2020-Debate/49ec04a876ae41b88eb13bec3ec55fad/2/0">AP Photo/Chris Carlson</a></span>
</figcaption>
</figure>
<p><strong>Aradhna Krishna, University of Michigan</strong></p>
<blockquote>
<p>“I think he’s a pretty good size for a president; he was five-foot-four.” - Minnesota Sen. Amy Klobuchar</p>
</blockquote>
<p><a href="https://pdfs.semanticscholar.org/a515/c6ef747b69d103305e8e326390f05d5f8caa.pdf">Imagery is a powerful tool</a> to get attention and persuade people to embrace an idea. The more easily a listener can construct an image in her mind, the easier it is to process a message, and the <a href="https://s3.amazonaws.com/academia.edu.documents/42755994/CCOG1999.pdf?response-content-disposition=inline%3B%20filename%3DEffects_of_Perceptual_Fluency_on_Judgmen.pdf&X-Amz-Algorithm=AWS4-HMAC-SHA256&X-Amz-Credential=AKIAIWOWYYGZ2Y53UL3A%2F20191220%2Fus-east-1%2Fs3%2Faws4_request&X-Amz-Date=20191220T021555Z&X-Amz-Expires=3600&X-Amz-SignedHeaders=host&X-Amz-Signature=c2fdff516dea0e440ebbc74a3ce9401db706da5032b042889e8b8101ea5f719a">more compelling that message becomes</a>.</p>
<p>Klobuchar did just that while responding to the opening question of how to get more people to support Trump’s impeachment. In the quote above, she was referring to James Madison, who she used to make a point about the importance of impeachment in the Constitution. </p>
<p>As soon as she mentioned that Madison was 5 foot 4 inches tall – about four inches shorter than the senator – we formed a powerful image in our minds of the Founding Father, and Klobuchar had our attention for the rest of her argument. </p>
<p>Imagery is typically used in dramatic ways in politics. For instance, political rallies often use human exemplars to make an abstract issue feel more real – they bring in a parent of a gun crime victim or a Vietnam vet who does not get enough medical support or a single mother who is doing four jobs but still not earning enough to make ends meet. </p>
<p>But what does one do at a political debate in which one cannot bring in the people? One way is to use <a href="https://doi.org/10.1016/j.jretai.2019.10.010">language that evokes a vivid mental image</a>. Citing stats about gun violence or economic inequality can impress; it takes the imagery to connect with people and persuade them to see your point of view. </p>
<p>An important difference is that Klobuchar wasn’t trying to get you to empathize with Madison – a trick politicians often use at rallies to show their compassion for someone who has suffered. She was simply using basic, evocative language to make a point come to life. </p>
<p>[ <em>Get the best of The Conversation, every weekend.</em> <a href="https://theconversation.com/us/newsletters/weekly-highlights-61?utm_source=TCUS&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=weeklybest">Sign up for our weekly newsletter</a>. ]</p><img src="https://counter.theconversation.com/content/129039/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Sarah Burns is a fellow at the Quincy Institute. </span></em></p><p class="fine-print"><em><span>Aradhna Krishna and Stephen Onyeiwu do not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Scholars explain important moments in the Democratic presidential debate on Dec. 19.Aradhna Krishna, Dwight F Benton Professor of Marketing, University of MichiganSarah Burns, Associate Professor of Political Science, Rochester Institute of TechnologyStephen Onyeiwu, Professor and Chair of the Economics Department, Allegheny CollegeLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1287352019-12-11T17:31:51Z2019-12-11T17:31:51ZUSMCA: The 3 most important changes in the new NAFTA and why they matter<figure><img src="https://images.theconversation.com/files/306386/original/file-20191211-95115-1lurugo.jpg?ixlib=rb-1.1.0&rect=10%2C10%2C2331%2C1408&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Leaders of the three countries signed the USMCA in November 2018.</span> <span class="attribution"><span class="source">AP Photo/Pablo Martinez Monsivais</span></span></figcaption></figure><p>President Donald Trump and Democratic leaders <a href="https://www.washingtonpost.com/business/2019/12/10/usmca-is-finally-done-deal-after-democrats-sign-off-heres-what-is-it/">agreed on a deal</a> to pass a new trade agreement between the U.S., Mexico and Canada that will update NAFTA. </p>
<p>Passing the new trade accord, known as the U.S.-Mexico-Canada Agreement, would be a substantial win for both Trump – given it’s one of <a href="https://www.whitehouse.gov/briefings-statements/president-donald-j-trump-keeping-promise-renegotiate-nafta/">his campaign promises</a> – and Democrats, who <a href="https://www.bloomberg.com/news/articles/2019-12-11/pelosi-balances-impeachment-and-usmca-with-eye-on-2020-elections">want to show they’re legislating</a> even as they prepare to impeach the president. </p>
<p>So how is the USMCA different from the North American Free Trade Agreement, and why should you care? </p>
<p>Although the final revised text of the USMCA has not yet been released, the deal as <a href="https://ustr.gov/trade-agreements/free-trade-agreements/united-states-mexico-canada-agreement/agreement-between">detailed in May</a> contains numerous tweaks from its predecessor, both big and small. As an agriculture economist who studies trade, <a href="https://scholar.google.com/citations?user=rToS2UYAAAAJ&hl=en&oi=ao">I believe</a> three changes are especially noteworthy. </p>
<h2>Please pass the butter</h2>
<p>Since 1994, the U.S. and Canada <a href="https://ageconsearch.umn.edu/bitstream/16835/1/ag01fr01.pdf">have dropped tariffs</a> and other trade restrictions on most agricultural products. But there were a few exceptions, most notably dairy. </p>
<p>Dairy was a particularly problematic sticking point in year-long negotiations between the three countries. The <a href="https://accounts.wsj.com/auth/sso/login?code=Zt6os4RvG0AtL2ui&state=http%3A%2F%2Fwww.wsj.com%2Farticles%2Fwhy-milk-matters-in-u-s-canada-trade-feud-1535803200&savelogin=on">U.S.</a> and <a href="https://slate.com/business/2018/06/trumps-beef-with-canadas-dairy-industry-explained.html">Canada</a> both have long histories of protectionist policies, such as subsidizing dairy farmers and setting import quotas on milk. Canadian tariffs on some products can be as high as 300%. </p>
<p>The new USMCA <a href="https://ustr.gov/about-us/policy-offices/press-office/fact-sheets/2018/october/united-states%E2%80%93mexico%E2%80%93canada-trade-fa-2">begins to change that</a>, representing a small but important win for both countries, especially the U.S. </p>
<p>Under the new accord, Canada <a href="https://www.cnn.com/2018/10/02/politics/usmca-canada-dairy/index.html">will curb some of the ways</a> it protects its dairy industry, such as allowing <a href="https://ustr.gov/about-us/policy-offices/press-office/fact-sheets/2018/october/united-states%E2%80%93mexico%E2%80%93canada-trade-fact">more American milk, butter, cheese and other dairy products</a> to enter Canada duty-free, with reciprocal treatment for Canadian dairy exports to the U.S.</p>
<h2>Made in North America</h2>
<p>The new agreement also made big changes for auto manufacturers in hopes of ensuring more vehicles and parts are made in North America. </p>
<p>Starting as early as 2020, to qualify for zero tariffs when crossing borders, a car or truck must have <a href="https://www.washingtonpost.com/business/economy/us-and-canada-closing-in-on-a-new-nafta-deal-as-deadline-looms/2018/09/30/2ef72018-c50b-11e8-b1ed-1d2d65b86d0c_story.html">75%</a> of its components manufactured in Canada, the U.S. or Mexico, up from 62.5% currently.</p>
<p>Even more noteworthy, negotiators agreed to a new requirement that 40% to 45% of a vehicle’s components must be made by workers earning at least US$16 per hour, which is about <a href="https://www.washingtonpost.com/business/2018/10/01/us-canada-mexico-just-reached-sweeping-new-nafta-deal-heres-whats-it/">three times more</a> than the average wage currently earned by Mexican auto workers. </p>
<p>This change is huge, particularly for low-paid workers in Mexico. But it may lead to challenges over the enforcement of labor laws and increase the cost of cars made in all three countries. </p>
<h2>Keeping up with the times</h2>
<p>Society has experienced significant technological changes since NAFTA was implemented in 1994. Back then, the internet was still in its infancy, while smartphones and self-driving cars were barely imaginable.</p>
<p>That’s why <a href="https://ustr.gov/about-us/policy-offices/press-office/fact-sheets/2018/october/united-states%E2%80%93mexico%E2%80%93canada-trade-fa-1">modernization</a> – updating rules and standards to keep up with the times – is a critical and positive update to the trade deal tying the North American continent together. </p>
<p>While NAFTA was the <a href="http://www.buildingipvalue.com/05_XB/052_055.htm">first trade treaty</a> to include intellectual property protections, the high pace of innovation has made modernization of its provisions imperative.</p>
<p>The new agreement <a href="https://www.washingtonpost.com/business/2018/10/01/us-canada-mexico-just-reached-sweeping-new-nafta-deal-heres-whats-it/?utm_term=.7be0c4624366">includes</a> stronger protections for patents and trademarks in areas such as biotech, financial services and domain names – all of which have advanced considerably over the past quarter-century. It also contains new provisions governing the expansion of digital trade and investment in innovative products and services. </p>
<p>Separately, negotiators agreed to update labor and environmental standards, which were not central to the 1994 accord and are now typical in modern trade agreements. Examples include enforcing a minimum wage for autoworkers, stricter environmental standards for Mexican trucks and new rules on fishing to protect marine life. </p>
<p>Apart from the changes, there is one important thing about the original NAFTA that will stay, thanks to the <a href="https://www.washingtonpost.com/business/2018/10/01/us-canada-mexico-just-reached-sweeping-new-nafta-deal-heres-whats-it/?utm_term=.15f9401acfa4">insistence</a> of Canada. Chapter 19 is the dispute settlement mechanism that allows countries to seek remedies for breaking the rules. It’s like “trade court” and makes it much easier to challenge another country’s policies.</p>
<p>Although Mexico’s Senate ratified the USMCA earlier this year, the deal still needed approval from Canada and the U.S. Congress. Democrats and <a href="https://www.politico.com/newsletters/morning-trade/2019/11/18/usmca-comes-down-to-labor-support-782542">labor unions insisted</a> on revisions to the text to address enforcement of labor and environmental provisions and intellectual property protection. The newly revised text agreed to by Trump and the Democrats addresses these issues and is now ready for approval by all three countries.</p>
<p>All in all, I believe the new NAFTA is definitely a modern and updated version of its important predecessor, which the U.S. Department of Agriculture <a href="https://www.fas.usda.gov/sites/development/files/nafta1.14.2008_0.pdf">characterized</a> as one of the most successful trade agreements in history. </p>
<p><em>This is an updated version of an <a href="https://theconversation.com/how-is-new-nafta-different-a-trade-expert-explains-104212">article originally published</a> on Oct. 2, 2018.</em></p>
<p>[ <em>Like what you’ve read? Want more?</em> <a href="https://theconversation.com/us/newsletters?utm_source=TCUS&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=likethis">Sign up for The Conversation’s daily newsletter</a>. ]</p><img src="https://counter.theconversation.com/content/128735/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Amanda M. Countryman receives funding from the National Science Foundation and the U.S. Department of Agriculture. </span></em></p>President Trump and Democrats recently agreed on a deal to pass the U.S.-Mexico-Canada Agreement. A trade scholar explains what’s new.Amanda M. Countryman, Associate Professor of Agricultural Economics, Colorado State UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1281052019-12-11T15:27:27Z2019-12-11T15:27:27ZMexico transformed? Challenges, changes after a year of leftist government<figure><img src="https://images.theconversation.com/files/306204/original/file-20191210-95111-11xt146.jpg?ixlib=rb-1.1.0&rect=0%2C91%2C3829%2C2407&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Mexican President Andres Manuel López Obrador speaks at the signing of an update to the new North American free-trade agreement in Mexico City.</span> <span class="attribution"><span class="source">(AP Photo/Marco Ugarte)</span></span></figcaption></figure><p>A year ago, the first leftist president in Mexico’s modern history <a href="https://www.latimes.com/world/la-fg-mexico-amlo-inauguration-20181201-story.html">took office.</a> </p>
<p>The victory of Andrés Manuel López Obrador, commonly referred to as AMLO in Mexico, swept aside a long-standing political establishment in a society where most politicians are seen as corrupt and detached from the reality of ordinary citizens. </p>
<p>López Obrador’s victory not only threatened the entrenched political and economic interests that dominated Mexican politics for decades, it also came as a reprieve to an embattled left in Latin America at a time when right-wing forces were on the rise. </p>
<p>The transformative project of the new government, dubbed <a href="https://www.bbc.com/mundo/noticias-america-latina-45712329">Mexico’s “Fourth Transformation,”</a> has promised to break with the neoliberal model that had turned the country into the <a href="http://www.oecd.org/social/inequality.htm#income">most unequal among OECD nations</a>. This has meant a drastic change in policy priorities.</p>
<p>Under López Obrador, the government no longer promotes investment and job creation at any price. Instead, it announced the <a href="https://www.proceso.com.mx/608544/a-punto-de-cumplir-un-ano-en-el-poder-amlo-presume-aumento-del-salario-minimo-y-programas-sociales">largest increase to the minimum wage in 36 years</a>, passed a <a href="https://www.wilsoncenter.org/article/infographic-mexicos-new-labor-reform">major labour reform strengthening workers’ rights</a> and ended decades of <a href="https://www.elsoldemexico.com.mx/mexico/politica/amlo-erradicara-condonacion-de-impuestos-a-empresas-con-reforma-3913245.html">discretionary tax breaks to large corporations</a>. These measures have unsettled some economic elites, who are now hesitant to invest in a country that is changing the rules of the game. </p>
<p>López Obrador seems aware that the surly relations between the government and the private sector can hinder his transformative agenda. Despite his campaign promise of a four per cent annual growth, the economic scenario in Mexico is daunting. As the country struggles to avoid recession, rating agencies and international organizations are <a href="https://elfinanciero.com.mx/economia/banxico-pasa-tijera-al-pronostico-de-crecimiento-para-2019-por-quinta-vez-consecutiva">lowering their outlooks for the Mexican economy</a>. </p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/306201/original/file-20191210-95173-1t4ko4s.jpg?ixlib=rb-1.1.0&rect=4%2C0%2C3257%2C1995&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/306201/original/file-20191210-95173-1t4ko4s.jpg?ixlib=rb-1.1.0&rect=4%2C0%2C3257%2C1995&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/306201/original/file-20191210-95173-1t4ko4s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=452&fit=crop&dpr=1 600w, https://images.theconversation.com/files/306201/original/file-20191210-95173-1t4ko4s.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=452&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/306201/original/file-20191210-95173-1t4ko4s.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=452&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/306201/original/file-20191210-95173-1t4ko4s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=568&fit=crop&dpr=1 754w, https://images.theconversation.com/files/306201/original/file-20191210-95173-1t4ko4s.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=568&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/306201/original/file-20191210-95173-1t4ko4s.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=568&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">López Obrador is seen with Canada’s Chrystia Freeland at the signing of an update to the USMCA.</span>
<span class="attribution"><span class="source">(AP Photo/Marco Ugarte)</span></span>
</figcaption>
</figure>
<p>This is why Mexicans were so prompt to ratify USMCA, a renegotiated version of NAFTA, <a href="https://www.dianomi.com/click.epl?pn=53774&offer=13302451&savid=138046&said=4146&adv=6273&unique_id=XfAN0fFCOGvw4zhvPVMPagAAAA0&smartreferer=&is_addefend_user=1">and its subsequent overhaul</a>, despite the free-trade deal being at odds with López Obrador’s anti-neoliberal stance. </p>
<p>The rapid ratification of the trade agreement not only sent a message of certainty to domestic and international investors, it also flagged the limits of the AMLO government when it comes to breaking with Mexico’s neoliberal past. </p>
<h2>Violence persists</h2>
<p>A second threat to López Obrador’s agenda is the rising levels of insecurity in the country. </p>
<p>The new administration has been unable to contain a wave of violence that it inherited from its predecessors. In fact, 2019 is on the verge of becoming the <a href="https://www.reforma.com/libre/acceso/accesofb.htm?urlredirect=/suman-25-890-homicidios-dolosos-en-2019/ar1795431">deadliest year on record in Mexico</a>. The <a href="https://www.cbc.ca/news/world/mexican-mormon-village-massacre-1.5357206">massacre of the LeBaron family</a> —in which six children and three women were murdered in northern Mexico — and the <a href="https://www.bbc.com/news/world-latin-america-50101794">failed attempt to arrest the son of drug lord El Chapo in Culiacán</a>, where the military was outnumbered by cartel gunmen, are just two examples of the government’s incapacity to end the violence.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/305737/original/file-20191208-90574-dl8rn3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/305737/original/file-20191208-90574-dl8rn3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/305737/original/file-20191208-90574-dl8rn3.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/305737/original/file-20191208-90574-dl8rn3.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/305737/original/file-20191208-90574-dl8rn3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/305737/original/file-20191208-90574-dl8rn3.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/305737/original/file-20191208-90574-dl8rn3.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Protesters hold a banner in support of the LeBaron family during a protest against López Obrador’s first year in office in Mexico City on Dec. 1, 2019.</span>
<span class="attribution"><span class="source">(AP Photo/Ginnette Riquelme)</span></span>
</figcaption>
</figure>
<p>The president’s <a href="https://www.theguardian.com/world/2019/nov/05/mexicos-security-failure-grisly-cartel-shootout-shows-who-holds-the-power">“abrazos, no balazos” (hugs, not bullets) policy</a> has been harshly criticized for its naiveté and has been largely ineffective.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/mexicos-new-president-has-plans-to-make-his-country-safer-but-will-they-work-100441">Mexico's new president has plans to make his country safer – but will they work?</a>
</strong>
</em>
</p>
<hr>
<p>However, one year into leftist rule in Mexico and it’s not all bad news. Despite economic woes and enduring violence, López Obrador’s government has made considerable progress dismantling a system that almost solely benefits the political and economic elite and keeps <a href="https://www.coneval.org.mx/SalaPrensa/Comunicadosprensa/Documents/2019/COMUNICADO_10_MEDICION_POBREZA_2008_2018.pdf">more than 50 million Mexicans in poverty</a>. </p>
<p>López Obrador started his term by announcing harsh austerity measures to bureaucrats and politicians, <a href="https://apnews.com/3ca432e8f74d44a2b15b17633c27631c/Mexican-president-elect-slashes-his-own-salary">including cutting his own salary in half</a> and ditching the presidential mansion, jet and guards. </p>
<h2>Tackling corruption</h2>
<p>In a clear break with the past, his government is prosecuting corrupt officials from previous administrations. Social spending is also being revamped. About 18 million youth and elderly Mexicans are now receiving their <a href="https://aristeguinoticias.com/0811/mexico/quiere-amlo-que-pension-por-vejez-y-becas-para-estudiar-esten-en-la-constitucion/">scholarships and pensions</a> from social programs as cash transfers. </p>
<p>Perhaps most importantly, López Obrador is transforming the perception of political power in Mexico and how it should be used. At most events he attends, the president finds himself surrounded by supporters who cheer and hug their leader without apparent constraints — in contrast to the strong security measures taken by his predecessors when in public. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/306131/original/file-20191210-95159-1l4n2ir.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/306131/original/file-20191210-95159-1l4n2ir.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=361&fit=crop&dpr=1 600w, https://images.theconversation.com/files/306131/original/file-20191210-95159-1l4n2ir.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=361&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/306131/original/file-20191210-95159-1l4n2ir.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=361&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/306131/original/file-20191210-95159-1l4n2ir.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=454&fit=crop&dpr=1 754w, https://images.theconversation.com/files/306131/original/file-20191210-95159-1l4n2ir.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=454&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/306131/original/file-20191210-95159-1l4n2ir.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=454&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">López Obrador greets supporters in Mazatlan, Mexico as he kicked off a nationwide tour after his election.</span>
<span class="attribution"><span class="source">(AP Photo/Eduardo Verdugo)</span></span>
</figcaption>
</figure>
<p>When asked about his safety, López Obrador confidently replies that it <a href="https://noticieros.televisa.com/ultimas-noticias/amlo-guardaespaldas-inconformes-ciudad-valles-seguridad/">is the people who look after him</a>. Despite his populist tone, he seems to understand that first and foremost, Mexico’s marginalized majorities need to be seen and recognized as part of a society that has excluded them for too long.</p>
<p>If we want to understand the change Mexico is undergoing, we must measure progress with metrics other than the GDP. Only when we gauge it via other methods will we understand the extent to which the political and economic structures that have made Mexico one of the most inequitable countries in the world are being dismantled. </p>
<p>Changing public perceptions about political power might not be as tangible as economic growth and decreasing homicide rates, but its impact on building a more inclusive society are real and every bit as important.</p>
<p>[ <em>You’re smart and curious about the world. So are The Conversation’s authors and editors.</em> <a href="https://theconversation.com/ca/newsletters?utm_source=TCCA&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=youresmart">You can read us daily by subscribing to our newsletter</a>. ]</p><img src="https://counter.theconversation.com/content/128105/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Sergio Daniel Michel Chavez does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>In his first year in office, the Mexican president is dismantling the political and economic structures that have made Mexico one of the most inequitable countries in the world.Sergio Daniel Michel Chavez, PhD Student, Department of Political Science and Institute of Political Economy, Carleton UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1259192019-11-06T22:20:23Z2019-11-06T22:20:23ZU.S.-Canada trade under Trudeau minority governments: Then and now<figure><img src="https://images.theconversation.com/files/299929/original/file-20191102-88414-117nrda.jpg?ixlib=rb-1.1.0&rect=66%2C199%2C2524%2C1686&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Pierre Trudeau is saluted by an RCMP officer as he carries son Justin to Rideau Hall in 1973, when the elder Trudeau was in a similar political situation as his son is today.</span> <span class="attribution"><span class="source">THE CANADIAN PRESS/Peter Bregg</span></span></figcaption></figure><p>Election season is over for Canadians — except for all of those continuing to follow the campaign trail to the White House. </p>
<p>The political situation Justin Trudeau finds himself in is strikingly similar to his father’s in the early 1970s. Canada is again facing alienation in the West, nationalism in Québec and impeachment to the south. The Richard Nixon tapes contained some <a href="https://www.cbc.ca/news/canada/just-released-1971-recording-captures-talks-between-nixon-pompous-trudeau-1.755465">choice words</a> about Pierre Trudeau, and President Donald Trump has <a href="https://twitter.com/realDonaldTrump/status/1005586152076689408?s=20%22%20/">publicly chastised</a> his son.</p>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"1005586152076689408"}"></div></p>
<p>In Justin Trudeau’s minority Parliament, alliances will need to be made and compromises brokered to pass legislation. </p>
<p>Minority governments are responsible for medicare, Canada Student Loans, the Canada Pension Plan, the flag, unification of the Armed Forces and official bilingualism. All of this happened under <a href="https://ipolitics.ca/article/remember-lester-pearson/">Lester B. Pearson’s minority governments</a> in the 1960s, and successes like these are the best-case scenario for Justin Trudeau’s minority government. </p>
<p>However, the focus 50 years ago seemed to be on domestic policies, not foreign. But ignoring foreign policy is the worst-case scenario in today’s minority situation.</p>
<h2>Seeking stability</h2>
<p>Tensions have flared between the U.S. and Canada in recent years, particularly after Trump’s tariffs on Canadian steel and aluminum in 2018 resulted in billions of dollars of lost export revenue. The <a href="https://www.international.gc.ca/trade-commerce/controls-controles/steel_alum-acier_alum.aspx?lang=eng">tariffs were lifted in May</a>, supposedly clearing the way for <a href="https://globalnews.ca/news/6115024/usmca-ratification-justin-trudeau-nancy-pelosi/">ratification of the new Canada-U.S.-Mexico trade agreement</a> by all three countries. Only Mexico has to date done so.</p>
<p>Discerning the intentions of our neighbours has always been a feature of the Canadian-American relationship, none more so than in trade. Anxieties over the relationship and the threat of American domination have been central to Canadian economic development for the last century.</p>
<p>The history is more than just a story of goods and services moving across a 8,891-kilometre-long border. It’s a story of how both countries have worked to know one another and live peacefully beside each other.</p>
<p>Canada sent its first three consuls general to New York, Chicago and San Francisco by 1948 to promote cross-border business and distinguish itself from Great Britain. Today, <a href="https://www.tradecommissioner.gc.ca/trade_commissioners-delegues_commerciaux/country-pays/united_states-etats_unis.aspx?lang=eng&_ga=2.156231283.992612766.1561386115-1985972173.1552598567#to">there are 16</a>.</p>
<p>In 1954, the U.S. Chamber of Commerce launched a public service campaign <a href="http://archive.macleans.ca/article/1963/4/20/what-americans-really-think-about-us">with a brochure entitled: <em>Are Canadians Really?</em></a></p>
<p>It talked about the myth that the Great Lakes never froze solid because of the warmth shared between Canadians and Americans. But as the editors asked, were the twitching lips of the neighbours smiles or gas pains?</p>
<h2>Canadian control</h2>
<p>Trying to address both elements of the relationship, Canadian governments have worked to strengthen trade relations and safeguard against America’s influence over their domestic markets via <a href="https://www.thecanadianencyclopedia.ca/en/article/economic-nationalism">economic nationalism</a>, the Canadianized term for protectionism. </p>
<p>At first, Canada worried about foreign investments in particular industries, like the railroads, and required that the majority of directors of any company that received government money could not come from outside the country.</p>
<p>Another approach was to ensure at least some firms in a given sector remained under Canadian control. This was achieved with amendments to the <a href="https://www.thecanadianencyclopedia.ca/en/article/bank-act">Bank Act</a> that required 75 per cent Canadian ownership in financial services.</p>
<p>A third initiative involved the government pre-empting foreign control by way of public ownership, like the nationalized transportation services <a href="https://www.thecanadianencyclopedia.ca/en/article/air-canada">Air Canada</a> and <a href="https://www.thecanadianencyclopedia.ca/en/article/canadian-national-railways">Canadian National Railways</a>.</p>
<p>Tariff reductions were the more outward-looking and reciprocal approach of the mid-1960s. The antecedent of NAFTA, and now the USMCA, originated in this period. The signing of the <a href="https://www.thecanadianencyclopedia.ca/en/article/canada-us-automotive-products-agreement">Auto Pact</a> lowered trade barriers and integrated supply chains, a model that hadn’t been tried before in peacetime.</p>
<p>All of these policy experiments were anchored by the fundamental assumption that the U.S. would continue to move toward freer trade.</p>
<h2>Nixon’s ‘jump off the diving board’</h2>
<p>In the 1970s, Richard Nixon veered off course by ending the <a href="https://history.state.gov/milestones/1969-1976/nixon-shock">link between the American dollar and gold</a> — the foundation of the international economic system since the end of the Second World War. It was, <a href="https://books.google.ca/books?id=Ay29AQAACAAJ&dq=Presidential+Economics:+The+Making+of+Economic+Policy+from+Roosevelt+to+Clinton.&hl=en&sa=X&ved=0ahUKEwjDu8_Q1c7iAhXdGDQIHWX8Be8Q6AEILjAB">as the chairman of Nixon’s Council of Economic Advisers said</a>, “a jump off the diving board without any clear idea of what lay below.” </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/300095/original/file-20191104-88399-1bomh0n.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/300095/original/file-20191104-88399-1bomh0n.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=444&fit=crop&dpr=1 600w, https://images.theconversation.com/files/300095/original/file-20191104-88399-1bomh0n.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=444&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/300095/original/file-20191104-88399-1bomh0n.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=444&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/300095/original/file-20191104-88399-1bomh0n.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=558&fit=crop&dpr=1 754w, https://images.theconversation.com/files/300095/original/file-20191104-88399-1bomh0n.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=558&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/300095/original/file-20191104-88399-1bomh0n.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=558&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Nixon and Pierre Trudeau talk in Trudeau’s office in Ottawa in this April 1972 photo.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Chuck Mitchell</span></span>
</figcaption>
</figure>
<p>It was a move away from free trade, because it made the world economy more dependent on the vagaries of the U.S. dollar. Nixon’s New Economic Policy also included a 10 per cent tax on imports. </p>
<p>Trump has been replicating these “America First” moves and the stakes are just as high. According to Canada’s commerce department, the U.S. accounted for 70 per cent of the Canadian export market in the 1970s; today, the World Trade Organization puts the <a href="https://www.wto.org/english/thewto_e/countries_e/canada_e.htm">percentage in the mid-70s</a>.</p>
<p>“The fact is that in recent months the world has entered a new phase in international trade.” This was the view from the father of socialized medicine, <a href="http://parl.canadiana.ca/view/oop.debates_HOC2803_09/453?r=0&s=1">Tommy Douglas, in the House of Commons</a>. He added:</p>
<blockquote>
<p>“We are now playing a different ball game. For the moment at least, the United States has retreated into a citadel of protectionism.”</p>
</blockquote>
<p>Both Trump and Nixon saw import taxes as a way to address a trade deficit. To eliminate it, the United States would have to sell more to Canada than it buys. But Canada is the smaller country, and the revenue generated by the imbalance is necessary to service its debt to the U.S. </p>
<h2>Needed U.S. investment</h2>
<p>Without a trade deficit, Canada would be reliant on U.S. direct investment to grow its economy. These numbers reached staggering proportions in the late 1960s — as high as 99 per cent foreign ownership in Canada’s petroleum and coal industries. </p>
<p>Canadian legislators reacted by passing measures to protect Canadian culture and limit foreign investment. Pierre Trudeau explored markets beyond the U.S. and developed the <a href="https://www.thecanadianencyclopedia.ca/en/article/foreign-investment-review-agency">Foreign Investment Review Agency</a> to monitor foreign ownership, ensuring it brought significant benefits with it. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/299930/original/file-20191102-88419-15j6l3u.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/299930/original/file-20191102-88419-15j6l3u.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=368&fit=crop&dpr=1 600w, https://images.theconversation.com/files/299930/original/file-20191102-88419-15j6l3u.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=368&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/299930/original/file-20191102-88419-15j6l3u.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=368&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/299930/original/file-20191102-88419-15j6l3u.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=463&fit=crop&dpr=1 754w, https://images.theconversation.com/files/299930/original/file-20191102-88419-15j6l3u.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=463&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/299930/original/file-20191102-88419-15j6l3u.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=463&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Prime Minister Justin Trudeau takes part in an interview in Ottawa in December 2016. A picture of his father, Pierre Trudeau, in Guyana in 1974 hangs on the wall behind.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Sean Kilpatrick</span></span>
</figcaption>
</figure>
<p>His minority Parliament needed support from the left-leaning NDP. The New Democrats then pushed the government into stronger nationalist policies than the Liberals ever intended.</p>
<p>But most provinces <a href="https://www.theglobeandmail.com/report-on-business/top-business-stories/regional-disparity-in-canada-among-worst-in-oecd/article20959497/">took a regional approach</a> to trade. Nova Scotia was never going to limit foreign companies exploiting its natural resources just because Ottawa said so; it wanted jobs, and the province’s proximity to the eastern seaboard made it easy. North-south trade has always been the easier option. </p>
<h2>Welcoming to foreign money</h2>
<p>The agency created by Pierre Trudeau has since gone from limiting foreign money to welcoming it. And now, Canada is pursuing trade diversification beyond the U.S. via its <a href="https://pm.gc.ca/eng/minister-international-trade-diversification-mandate-letter-august-28-2018">international trade ministry</a>.</p>
<p>America’s central role in the global economy allows it to instil its anxieties internationally. All countries are dealing with how resurgent U.S. protectionism plays out in terms of immediate trade prospects and the long-range forecast for a freer trading world. </p>
<p>Protectionism had unintended consequences for Canadian policies in the 1970s and could again today.</p>
<p>There’s a different Trudeau in office, and another minority Parliament dealing with a fractious population. It’s easy to ignore foreign and trade policy when a motion of non-confidence could lead your government to fall any day. But focusing on domestic policy alone is not the answer. It’s a lesson both Canada and the United States should remember.</p>
<p>[ <em>You’re smart and curious about the world. So are The Conversation’s authors and editors.</em> <a href="https://theconversation.com/ca/newsletters?utm_source=TCCA&utm_medium=inline-link&utm_campaign=newsletter-text&utm_content=youresmart">You can read us daily by subscribing to our newsletter</a>. ]</p><img src="https://counter.theconversation.com/content/125919/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Jennifer Levin Bonder's doctoral research has received funding from the Social Sciences and Humanities Research Council of Canada. </span></em></p>There’s a different Trudeau in office in 2019 than there was in 1972, but Justin Trudeau is also leading a minority government, just as his father did — and the Canada-U.S. relationship is key.Jennifer Levin Bonder, Junior Fellow at The Bill Graham Centre for Contemporary International History, University of TorontoLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1178532019-06-10T21:26:06Z2019-06-10T21:26:06ZHere’s the historic Canadian city Trump needs to visit<p>Canada-U.S. relations sit at a low point, eroding in recent years over everything from <a href="https://globalnews.ca/news/4244395/aluminum-steel-tariffs-canadians/">steel tariffs</a> <a href="https://www.reuters.com/article/us-venezuela-politics-usa-canada/pence-says-canada-should-work-with-u-s-on-cuba-and-venezuela-idUSKCN1T02BH">to Cuba</a> and <a href="https://globalnews.ca/news/5256532/northwest-passage-canada-us-claim-challenge/">the Arctic</a>.</p>
<p>The current relationship between Canadian Prime Minister Justin Trudeau and U.S. President Donald Trump is more similar to the frosty <a href="https://www.cbc.ca/news/canada/prime-ministers-and-presidents-1.848083">Lyndon Johnson-Lester B. Pearson</a> years than the storied bromance <a href="https://www.cbc.ca/news/politics/hall-trudeau-obama-bromance-1.3486409">between Trudeau and Barack Obama</a>.</p>
<p>The easing of tensions could start simply enough. The White House should consider a presidential visit to Canada. Not just a <a href="https://www.cbc.ca/news/politics/powerandpolitics/a-history-of-canada-u-s-state-visits-1.3480033">standard visit</a> to Ottawa, however — instead, a reaffirmation of the ties between the two countries in Kingston, Ont. </p>
<h2>Why Kingston?</h2>
<p>War on the European continent was brewing in 1938, and Canada was <a href="http://www.journal.forces.gc.ca/vo3/no1/doc/17-22-eng.pdf">entangled in the European orbit</a> even after gaining national sovereignty from Great Britain in 1867. </p>
<p>Canada and the United States, however, were divided over entry into the Second World War.</p>
<p>The Americans were neutral and against intervention, reined in by congressional <a href="https://history.state.gov/milestones/1921-1936/neutrality-acts">neutrality acts</a>. Mackenzie King, meanwhile, <a href="https://www.cbc.ca/history/EPISCONTENTSE1EP13CH4PA3LE.html">entered Canada into the war</a> in September 1939 to support the British against the Germans. </p>
<p>A year before Canada’s involvement, U.S. President Franklin D. Roosevelt had visited Kingston, on the shores of eastern Lake Ontario, to meet with King. Both leaders understood the looming threat of Adolf Hitler’s Germany to the security of both countries.</p>
<p>Roosevelt vowed “<a href="https://www.queensu.ca/gazette/alumnireview/stories/fdrs-historic-campus-visit">the United States will not stand idly by if domination of Canadian soil is threatened by any other empire</a>.” King made similar assurances <a href="https://www.cnrs-scrn.org/northern_mariner/vol01/tnm_1_1_3-22.pdf">in a speech in Woodbridge, Ont.</a>, pledging support to America’s security. </p>
<p>The Kingston visit was symbolic and enduring. The United States apparently shifted away from its isolationist stance, assuring Canada it had a reliable partner to the south. </p>
<p>Canadian political science professors David Haglund and Michel Fortmann have referred to this historic visit as the <a href="http://www.journal.forces.gc.ca/vo3/no1/doc/17-22-eng.pdf">“Kingston Dispensation.</a>” Each country exchanged a “neighbourly obligation” to elevate the other’s security interests to that of their own. </p>
<p>The Kingston Dispensation also laid the groundwork for North American security at the onset of the Second World War. Two short years later, the <a href="https://www.treaty-accord.gc.ca/text-texte.aspx?id=100977">Ogdensburg Agreement</a> cemented the bilateral security commitment. </p>
<p>A visit to Kingston could, once again, play a role in bridging relations between Canada and the United States.</p>
<h2>Current state of affairs</h2>
<p>Only <a href="https://d3n8a8pro7vhmx.cloudfront.net/cdfai/pages/4131/attachments/original/1558031388/Keynote_Presentation_by_Jacob_Poushter_from_Pew_Research_Center.pdf?1558031388">25 per cent of Canadians</a> view Trump positively, according to a 2018 Pew Research poll, a departure from Obama’s ratings, <a href="https://d3n8a8pro7vhmx.cloudfront.net/cdfai/pages/4131/attachments/original/1558031388/Keynote_Presentation_by_Jacob_Poushter_from_Pew_Research_Center.pdf?1558031388">which were above 80 per cent for most of his presidency</a>. </p>
<p>Since his election in 2016, Trump’s primary Canadian objective was the <a href="https://www.whitehouse.gov/briefings-statements/president-donald-j-trump-keeping-promise-renegotiate-nafta/">renegotiation of NAFTA</a>. He labelled Canada a <a href="https://globalnews.ca/news/4355100/defends-steel-tariffs-canada-security-threat/">national security threat</a> to justify tariffs on steel and aluminum. </p>
<p>Canada <a href="https://www.cbc.ca/news/canada/british-columbia/meng-wanzhou-may-8-court-appearance-1.5127740">arrested Huawei executive Meng Wanzhou</a>, honouring an extradition request from the United States. But it now finds itself in the middle of a broader <a href="https://www.washingtonpost.com/world/china-formally-accuses-canadians-of-espionage-as-huawei-standoff-intensifies/2019/05/16/be4b65b6-7790-11e9-ac17-284a66782c41_story.html?utm_term=.9176beaa2c6e">U.S.-China standoff</a>, and China has retaliated by indefinitely detaining <a href="https://globalnews.ca/news/5283082/canadians-arrested-china-huawei-spavor-kovrig/">two Canadian citizens</a> and restricting imports of <a href="https://www.cbc.ca/news/business/canada-canola-china-1.5067307">canola seed</a>, affecting Canadian farmers.</p>
<p>The U.S. and Canada are <a href="https://www.reuters.com/article/us-venezuela-politics-usa-canada/pence-says-canada-should-work-with-u-s-on-cuba-and-venezuela-idUSKCN1T02BH">at odds</a> over the role of Cuba in the Venezuela crisis. The Trump administration opposes Cuba’s alleged backing of Nicolas Maduro’s regime. Trudeau, however, says Cuba can play a “positive role” in Venezuela’s stability.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/the-us-venezuela-cuba-triangle-35745">The US-Venezuela-Cuba triangle</a>
</strong>
</em>
</p>
<hr>
<p>And recently, U.S. Secretary of State Mike Pompeo contradicted the terms of the 1988 <a href="https://www.treaty-accord.gc.ca/text-texte.aspx?id=101701">Ronald Reagan-Brian Mulroney agreement</a> on the Arctic, calling Canada’s claim over the Northwest Passage illegitimate. Trudeau <a href="https://pm.gc.ca/eng/news/2019/05/30/prime-minister-welcomes-increased-collaboration-united-states">reasserted Canada’s Arctic sovereignty</a> claims during Vice-President Mike Pence’s recent Ottawa visit.</p>
<h2>‘Uneasy’</h2>
<p>An uneasy state is the best way to describe Canada-U.S. relations.
But Canada presents the Trump administration with a unique foreign policy opportunity — to create a legacy in North America that’s focused on North American security.</p>
<p>And that legacy can start in Kingston.</p>
<p>Trump’s <a href="https://www.whitehouse.gov/briefings-statements/president-donald-j-trumps-foreign-policy-puts-america-first/">“America First”</a> strategy is focused on homeland security, reducing foreign commitments, economic security and reassuring allies while deterring enemies.</p>
<p>His North America strategy could start with four key issues: the Arctic, trade, <a href="http://www.forces.gc.ca/en/news/article.page?doc=norad/hjiq6lbn">NORAD</a> and halting Chinese ambitions. Each area requires a dynamic relationship with Canada and costs the administration zero political capital.</p>
<p>It could be a policy that goes hand-in-hand with America First. </p>
<p>Most American presidents have conducted state, official, or informal <a href="https://www.cbc.ca/news/politics/trump-presidential-visits-to-canada-1.5113449">visits to Canada</a> in their first terms. Trump’s sole visit to Canada was at the G7 summit in Charlevoix last June, and it was <a href="https://www.theguardian.com/world/2018/jun/10/g7-in-disarray-after-trump-rejects-communique-and-attacks-weak-trudeau">cut short</a> for the summit in Singapore with North Korean leader Kim Jong-un. It also didn’t go very well, with Trudeau’s public admonishments about <a href="https://montrealgazette.com/news/quebec/g7-summit-trump-leaves-as-he-arrived-alone-and-mired-in-controversy">U.S. steel tariffs against Canada angering Trump.</a> </p>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"1005586152076689408"}"></div></p>
<p>Now, however, Trump could establish the foundation of his North America strategy and reaffirm Canada-U.S. relations by an official visit to Canada again — this time in Kingston. It would reaffirm to Americans and Canadians alike that the countries are strong allies just as they were in the Second World War, it would elevate Canada’s security interests under a North America strategy and it would legitimize Trump’s foreign policy objectives.</p>
<h2>The Kingston ‘reaffirmation’</h2>
<p>Any Kingston reaffirmation must centre on topics unique to Canada-U.S. relations. </p>
<p>Trump and the Canadian prime minister could acknowledge the 60th anniversary of the completion of the <a href="https://globalnews.ca/news/5098629/st-lawrence-seaway-marks-60-years-of-business/">St. Lawrence Seaway</a>, outline efforts to modernize NORAD and highlight the potential gains from the new NAFTA.</p>
<p>And there’s also an underlying rallying cry — China’s actions on the world stage. </p>
<p>Trump could urge President Xi Jinping to release Canadian prisoners and scold China for the canola seed dispute.</p>
<p>He could acquiesce to the <a href="https://www.treaty-accord.gc.ca/text-texte.aspx?id=101701">existing agreement</a> on Canada’s internal Arctic waters, as there is virtually no political base in America focused on the Arctic. </p>
<p>Trump could outline his administration’s North America strategy. It would be good for Canadians, good for Americans and good for the Canada-U.S.relationship. </p>
<p>Neighbours are always going to disagree; it would be naive to think otherwise. Trump’s unscripted nature is particularly challenging for Canada. But a reaffirmation is long overdue — and Kingston would be a fitting locale for such a historic moment.</p><img src="https://counter.theconversation.com/content/117853/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The author is affiliated with the United States Air Force. This article was prepared by James L. Anderson in his personal capacity. The opinions expressed in this article are the author's own and do not reflect the view of the United States Air Force, Department of Defense, or United States Government.</span></em></p>A presidential visit to Kingston, Ont. – like the one FDR paid in 1938 – could once again play a role in bridging relations between Canada and the United States.James L. Anderson, Visiting Fulbright Fellow at Centre for International and Defence Policy, Queen's University, OntarioLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1183132019-06-04T21:13:52Z2019-06-04T21:13:52ZTrump’s Mexico tariffs don’t make sense, but Americans will pay a steep price anyway if they go into effect<figure><img src="https://images.theconversation.com/files/277984/original/file-20190604-69051-hue4dh.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Mexican avocados may soon be more expensive in American supermarkets.</span> <span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Amazon-Whole-Foods-Shoppers/b4e9f25301294abfb89c0d0edb8b40d5/11/0">AP Photo/Mark Lennihan</a></span></figcaption></figure><p>The <a href="https://www.washingtonpost.com/world/the_americas/mexico-sees-80-percent-chance-of-a-deal-to-head-off-trump-tariffs/2019/06/04/53bdce08-86c4-11e9-98c1-e945ae5db8fb_story.html">Trump administration says it intends</a> to slap a 5% tariff on <a href="https://atlas.media.mit.edu/en/visualize/tree_map/hs92/export/mex/usa/show/2017/">every medium-sized car, avocado and other Mexican import</a> beginning June 10 – all <a href="https://www.nytimes.com/2019/04/01/us/politics/trump-border-closing-economy.html">almost US$1 billion worth</a> that crosses the border into the U.S. each day on average. </p>
<p>The president is using the policy as a cudgel to compel Mexico to do more to stem the flow of migrants into the U.S. and says he’ll increase the tariff if things don’t improve. As a <a href="https://scholar.google.com/citations?user=vf1UpqAAAAAJ&hl=en&oi=ao">scholar who studies trade policy</a>, I have a hard time agreeing with the president’s strategy that tariffs can be used as a stick to pressure another country to do whatever he wants. </p>
<p>More than that, Americans will pay the price – as they have with <a href="https://www.nytimes.com/2019/05/16/podcasts/the-daily/trump-tariffs-china-trade-war.html">Trump’s U.S.-China trade war</a>. </p>
<h2>Driving up costs to consumers and businesses</h2>
<p>Tariffs, which are a tax imposed on imports paid by consumers in the recipient country, are typically used as a protectionist measure. </p>
<p>That is, governments use them to promote domestic goods in the face of global competition. For instance, if a domestically made item costs less than a foreign made item – due to tariffs increasing the price – trade scholars would expect a consumer to choose the less expensive, domestic item. </p>
<p>This would make sense in an economy where consumers have actual choices about whether to buy a foreign or domestic product. However, due to the evolving global economy, most consumer goods are made abroad or <a href="https://www.uschamber.com/series/above-the-fold/global-supply-chains-big-win-consumers-us-businesses">contain foreign parts</a>. <a href="https://money.cnn.com/2018/07/02/news/companies/auto-tariffs/index.html">All “U.S.-made” cars</a>, for examples, contain foreign parts. And <a href="https://muse.jhu.edu/article/705963/summary">my research has shown</a> that it is not easy to understand how “foreign” a product is. </p>
<p>One good example is avocados. Mexico <a href="https://www.live5news.com/2019/06/02/mexican-avocado-growers-expect-us-consumers-bear-tariffs/">produces 11</a> for every 1 grown in California, and demand is unlikely to diminish for avocado toasts and guacamole, so Americans will simply have to pay more. </p>
<p>The long and short of it is that a 5% tariff on all imports from Mexico will drive up costs to American consumers and businesses by almost the entire amount, meaning using them to solve a very different border security issue will be very painful. </p>
<h2>Killing the USMCA</h2>
<p>It is also quite confusing to place tariffs against Mexico. </p>
<p>Just six months ago, the U.S, Canada and Mexico <a href="https://theconversation.com/us/topics/usmca-60377">finished negotiating a massive trade deal</a> to replace the often-reviled North American Free Trade Agreement. Although the deal has been signed by leaders of each country, it has not yet been ratified by the U.S. Congress. </p>
<p>President Donald Trump, who <a href="http://fortune.com/2016/09/27/presidential-debate-nafta-agreement/">has frequently blasted NAFTA</a> and <a href="https://www.npr.org/2018/11/30/672150010/usmca-trump-signs-new-trade-agreement-with-mexico-and-canada">trumpeted</a> its replacement, now risks seeing his U.S., Mexico, Canada Agreement torpedoed. House Democrats <a href="https://www.wsj.com/articles/trumps-new-nafta-faces-mounting-resistance-in-democratic-house-11556493604">were already on the fence</a> about whether to ratify it and may use his tariff threats against Mexico over immigration as another reason to vote it down – or to get an immigration deal more to their liking. </p>
<p>And Mexico, which also has yet to ratify the USMCA, is also talking about retaliation against any tariffs Trump imposes, including <a href="https://www.wsj.com/articles/trumps-top-trade-adviser-opposed-mexican-tariffs-11559320692">rejecting</a> the negotiated accord. Tearing up the deal could cause <a href="https://www.fxstreet.com/news/us-potential-effects-if-congress-rejects-the-usmca-wells-fargo-201904151731">economic turmoil</a> for the U.S., particularly as Mexico is the <a href="https://ustr.gov/countries-regions/americas/mexico">second-largest export market</a> for U.S. goods.</p>
<p>All in all, <a href="https://piie.com/commentary/testimonies/evidence-costs-and-benefits-economic-sanctions">academic research has shown</a> economic sanctions, including tariffs, aren’t an effective way to conduct foreign policy. Unfortunately, they seem to have become the Trump administration’s go-to strategy when it doesn’t get its way.</p><img src="https://counter.theconversation.com/content/118313/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Christina Fattore does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>President Trump plans to put a 5% tariff on every Mexican good that crosses the border unless Mexico does more to reduce the flow of migrants.Christina Fattore, Associate Professor of Political Science, West Virginia UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1169182019-05-21T22:57:45Z2019-05-21T22:57:45ZThe new NAFTA’s assault on public health<figure><img src="https://images.theconversation.com/files/275157/original/file-20190517-69174-1yeydve.jpg?ixlib=rb-1.1.0&rect=0%2C0%2C2396%2C1422&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">U.S. President Donald Trump, Prime Minister Justin Trudeau and Mexico's President Enrique Pena Nieto hold a news conference before signing the USMCA. The deal, if passed into law, poses dangers to public health.</span> <span class="attribution"><span class="source">(AP Photo/Pablo Martinez Monsivais)</span></span></figcaption></figure><p><a href="https://www.ctvnews.ca/politics/canada-agrees-to-new-trilateral-trade-deal-with-u-s-and-mexico-1.4115731">The negotiations were strained</a> and at times it looked like it would be stillborn, but the USMCA (the new North American Free Trade Agreement linking the economies of the United States, Mexico and Canada) was signed in November 2018 and awaits ratification.</p>
<p><a href="https://www.washingtonpost.com/business/economy/north-american-trade-deal-faces-early-headwinds-on-capitol-hill/2019/03/29/ef5b0d0c-5178-11e9-88a1-ed346f0ec94f_story.html?utm_term=.f984de2e42de">Its future is still uncertain.</a> Although U.S. President Donald Trump finally <a href="https://globalnews.ca/news/5291819/freeland-tariffs-the-west-block/">removed tariffs on steel and aluminium imports from Canada and Mexico</a>, something both countries and even some congressional Republicans were demanding for the deal to be ratified, <a href="https://www.ctvnews.ca/politics/new-nafta-deal-at-risk-as-u-s-democrats-want-negotiations-reopened-1.4363491">Democrats in the U.S.</a> are unhappy with its costly monopoly protection for new pharmaceuticals and weak enforcement measures for labour and environmental protection. </p>
<p>But beneath the political jockeying is a sleeper issue concerning public health that signals a bad agreement.</p>
<h2>Health impact assessment</h2>
<p>We undertook <a href="https://globalizationandhealth.biomedcentral.com/articles/10.1186/s12992-019-0476-8">a recently released health impact assessment of the USMCA</a>, focusing on three specific aspects of the agreement with direct or indirect health effects —pharmaceuticals, health and environmental regulations and labour and environmental protection. </p>
<p>For prescription drugs, <a href="https://www.healthsystemtracker.org/chart-collection/recent-forecasted-trends-prescription-drug-spending/#item-growth-in-price-and-utilization-of-pharmaceuticals-has-varied-over-time_2019">the costs of which have risen dramatically since the era of patent protection</a> in trade agreements, the USMCA contains provisions the Americans wanted in the <a href="http://www.ijhpm.com/article_3186.html">Trans-Pacific Partnership agreement</a>. </p>
<p>These provisions were suspended by the remaining countries when Trump pulled the U.S. out of that agreement. Now they’re back in, but with an even longer 10-year guaranteed monopoly for biologics, a new category of costly drugs used to treat cancers and autoimmune disorders. Generic equivalents known as “biosimilars” can <a href="http://www.pmprb-cepmb.gc.ca/view.asp?ccid=1304">cut the price by almost half</a>. </p>
<p>Canada currently offers eight years of market protection for biologics; the additional two years <a href="https://www.pbo-dpb.gc.ca/en/blog/news/CUSMA_prescription_drugs">could eventually add almost $170 million to each year’s drug costs</a>. Hardest hit would be Mexico, which presently offers no such monopoly rights for biologics. </p>
<p>The USMCA also locks in rules that make it easier for drug companies to “evergreen” their products through minor changes in their components or in how they’re administered, extending the years of patent protection and prevent regulators from using, for several years, the patent drug company’s test data when approving generic versions.</p>
<h2>Impact on health regulations</h2>
<p>A more subtle but critical set of changes in the USMCA imposes new constraints on the three countries’ abilities to enact health, safety and environmental policies or regulations. </p>
<p>It is these so-called <a href="https://journals.sagepub.com/doi/abs/10.1177/1468018117731415?journalCode=gspa">behind-the-border rules in trade and investment agreements</a> that have garnered the greatest public health concerns. The USMCA tries to assuage these concerns by affirming countries’ “inherent right to regulate” including “to protect public health, safety, the environment (and) natural resources.” </p>
<p>But it immediately undercuts this right by specifying that it must be exercised “in a manner consistent with this agreement.” That “consistent manner” includes provisions that could make it harder for Mexico to use existing safeguards under World Trade Organization rules to ensure domestic food security or <a href="https://www.iatp.org/blog/201902/fair-prices-and-bold-new-deal-mexico">to guarantee minimum food prices to reduce rural poverty and support small-scale Mexican farmers</a>. </p>
<p>It requires the three governments to ensure that any new international standards upon which new regulations might be based “do not create unnecessary obstacles to international trade,” suggesting trade issues will trump new health regulations. This became an issue even during negotiations, when <a href="https://theconversation.com/how-nafta-will-make-us-fat-if-the-u-s-has-its-way-94198">the U.S. wanted the agreement to ban any front-of-package nutrition labelling</a> that would warn consumers of unhealthy levels of fat, salt or sugar.</p>
<p>Canada and Mexico rejected this, but the USMCA contains several provisions on labelling that could lead to trade disputes should the two other countries choose to adopt new nutrition labels, <a href="https://www.canada.ca/en/health-canada/programs/consultation-front-of-package-nutrition-labelling-cgi/summary-of-proposed-amendments.html">as Canada is proposing to do</a>. </p>
<p>American and Canadian trade associations representing meat processors have already argued that <a href="https://www.regulations.gov/document?D=OMB-2018-0006-0007">Canada’s proposal violates the USMCA</a>, portending a possible trade challenge if the USMCA becomes law. </p>
<h2>Foxes guarding the hen house</h2>
<p>Other rules open the doors for “persons of another party” — in other words, primarily U.S.-based corporations — to have a seat at the table when Canada or Mexico decide to consult on new regulations. </p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/275748/original/file-20190521-23814-1p6twfg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/275748/original/file-20190521-23814-1p6twfg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/275748/original/file-20190521-23814-1p6twfg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/275748/original/file-20190521-23814-1p6twfg.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/275748/original/file-20190521-23814-1p6twfg.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/275748/original/file-20190521-23814-1p6twfg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/275748/original/file-20190521-23814-1p6twfg.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/275748/original/file-20190521-23814-1p6twfg.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Inviting corporations to help determine new regulations is a bit like asking the fox to guard the hen house.</span>
<span class="attribution"><span class="source">Scott Walsh/Unsplash</span></span>
</figcaption>
</figure>
<p>This runs the risk of <a href="https://www.investopedia.com/terms/r/regulatory-capture.asp">regulatory capture</a> by private vested interests, akin to inviting the foxes to guard the hen house. Unaware that your <a href="http://time.com/4832688/makeup-shampoo-toxic/">cosmetics are not always healthy or safe</a>? The USMCA would like to keep it that way, requiring governments to wait until a problem shows up and fix it later.</p>
<p>In a similar way, USMCA provisions require governments to submit detailed scientific evidence and explanation for any new government regulation, which is likely to lead to <a href="https://www.iatp.org/sites/default/files/2018-11/NewNAFTA_Stuart%20Trew.pdf">“regulatory chill,”</a> slowing down or preventing the introduction of novel health protection measures. This risk is compounded by an entire and enforceable chapter that aims to have the three governments harmonize their regulations to enable freer movement of goods across borders. </p>
<p>The economic elephant in the USMCA is, of course, the U.S., whose regulatory rules will likely set the tone for Canada and Mexico, and the Trump administration <a href="https://www.brookings.edu/interactives/tracking-deregulation-in-the-trump-era/">is keen to undo as many health and environmental regulations as possible</a>. </p>
<p>There are some less troubling glimmers in the new agreement. Controversial rules allowing foreign investors to sue governments over regulations that may undermine the value of their investment have been eliminated between the U.S. and Canada, apart from a three-year window for “legacy claims” to be made. </p>
<p><a href="https://www.policyalternatives.ca/sites/default/files/uploads/publications/National%20Office/2018/01/NAFTA%20Dispute%20Table%20Report%202018.pdf">Canada fared particularly badly under the old NAFTA</a> while the U.S. never lost a case, yet it was the United States that scrapped the rules while Canada wanted to keep them. So go figure. The Americans hedged their bets, however, by retaining the rules to protect U.S. investors in Mexico. </p>
<h2>Mandatory Mexican minimum wage</h2>
<p>The USMCA also contains provisions that claim to protect labour rights and the environment, often used by governments to sell trade deals to skeptical citizens. </p>
<p>A key labour provision, however, requires Mexico to amend its laws to allow workers to more effectively collectively bargain. The country <a href="https://www.washingtonexaminer.com/policy/economy/mexico-adopts-labor-reforms-advancing-trump-usmca-trade-deal">recently passed</a> legislation to satisfy this provision but questions remain over implementation and enforcement strategies. </p>
<p>A second provision mandates a substantially increased minimum hourly wage in Mexico’s auto-manufacturing sector, which could help relieve poverty for Mexicans, although Mexican exporters might opt instead to pay the low tariff the U.S. would levy if they fail to raise wages. </p>
<p>And while there’s lots of references to labour rights and multilateral environmental agreements in the USMCA, it’s unsurprisingly silent on climate change and the <a href="https://unfccc.int/process-and-meetings/the-paris-agreement/the-paris-agreement">Paris climate accord.</a> And there are escape clauses — provisions only become enforceable if a country lowers its existing level of protection to gain a trade or investment advantage. This might prevent a race to the regulatory bottom, but it’s hardly a reassuring reach for the top. </p>
<p>In the end we have an agreement that binds governments’ future regulatory options in return for scant evidence of improved labour or environmental protection, or even economic gain. The IMF, for example, estimates <a href="https://www.imf.org/en/Publications/WP/Issues/2019/03/26/NAFTA-to-USMCA-What-is-Gained-46680">a net economic boost across the three countries of US$550 million a year</a>, chump change at best. </p>
<p>The U.S. International Trade Office (ITO), with some fanfare, begged to differ, announcing American gains of <a href="https://www.usitc.gov/publications/332/pub4889.pdf">US$62 billion and 176,000 new jobs</a>. The rub here is that these numbers rest on a unique modelling assumption, “reduced policy uncertainty,” that raised the eyebrows of most conventional trade economists. Remove this novel assumption and the American study actually shows a net loss in both income and jobs. Make America Great Again? Perhaps not so much. </p>
<p>As with any trade agreement, some economic sectors will be winners and others losers. But as far as protecting public health is concerned, the USMCA is a big step backwards.</p><img src="https://counter.theconversation.com/content/116918/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ronald Labonte receives funding from the Canadian Institutes of Health Research. </span></em></p><p class="fine-print"><em><span>Courtney McNamara receives funding from the Norwegian Research Council for her project ‘Trade, Labor Markets, and Health.’ </span></em></p><p class="fine-print"><em><span>Deborah Gleeson has received funding in the past from the Australian Research Council. She has received funding from various national and international non-government organisations to attend speaking engagements related to trade agreements and health. She has represented the Public Health Association of Australia on matters related to trade agreements and public health.</span></em></p><p class="fine-print"><em><span>Eric Crosbie does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The collective public health of Canada, the United States and Mexico will take a hit if the new NAFTA becomes law.Ronald Labonte, Professor and Canada Research Chair, L’Université d’Ottawa/University of OttawaCourtney McNamara, Senior Researcher, Department of Sociology and Political Science, Norwegian University of Science and TechnologyDeborah Gleeson, Senior Lecturer in Public Health, La Trobe UniversityEric Crosbie, Assistant Professor, University of Nevada, RenoLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1114692019-02-12T22:48:21Z2019-02-12T22:48:21ZFrom cannabis edibles to plant proteins: 2019 food trends<figure><img src="https://images.theconversation.com/files/258383/original/file-20190211-174857-b1nlw3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Plant-based foods, including fruits and vegetables, will be more popular this year.</span> <span class="attribution"><span class="source">Sydney Rae/Unsplash</span></span></figcaption></figure><p>Food continues to find its way into the consciousness of Canadians. </p>
<p>It’s in our news feed, on our television screens and, more and more, part of our day-to-day conversations. The challenge is to separate the fact from the fiction, the ephemeral from the soon-to-be everyday. The University of Guelph’s newest <a href="https://www.foodfocusguelph.ca/trends-report">Food Focus Trends Report</a> highlights six key trends likely to be front and centre this year.</p>
<h2>Flexitarians on the rise</h2>
<p>While vegans and vegetarians get all the attention, the <a href="https://www.foodfocusguelph.ca/blog/the-new-food-guide-a-reflection-or-driver-of-change">flexitarians</a> are rapidly growing in number — and in clout. A flexitarian is someone who is eating less meat rather than giving it up entirely.</p>
<p>Almost 85 per cent of Canadians claim to eat at least one vegetarian meal per month, with nearly 50 per cent saying they do so at least once a week. Despite only seven to eight per cent of Canadians identifying as vegetarian or vegan, the conscious consumption of flexitarians will likely have a profound impact on the quantity and types of meat we eat as well as spurring the growth of protein alternatives. </p>
<p>By choosing to eat less meat, consumers are likely to indulge in more premium cuts while sacrificing staples like ground beef.</p>
<p>Plant-based proteins are also sure to grow in popularity, as are those from previously taboo sources, such as insects. Canada’s new <a href="https://food-guide.canada.ca/en/">Food Guide</a> also recommends an increased focus on plant-based foods.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/in-defence-of-canadas-food-guide-110347">In defence of Canada's Food Guide</a>
</strong>
</em>
</p>
<hr>
<p>Should Canada’s meat industry be concerned? Possibly, but increased international demand should keep overall prices in our country steady for the foreseeable future and population growth here will also continue to increase the total demand for meat.</p>
<h2>Easing fears about gene-editing</h2>
<p>If comic books and horror movies have taught the average Canadian anything, it’s that nothing good ever comes from playing with genes. </p>
<p>Unfortunately, fiction can sometimes be more believable than facts. When it comes to agriculture, gene editing increases yields, develops tolerances to things like drought or pests, removes allergens (to make gluten-free wheat, for example) and enhances nutritional quality. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/258306/original/file-20190211-174870-1wf7jfx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/258306/original/file-20190211-174870-1wf7jfx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/258306/original/file-20190211-174870-1wf7jfx.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/258306/original/file-20190211-174870-1wf7jfx.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/258306/original/file-20190211-174870-1wf7jfx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/258306/original/file-20190211-174870-1wf7jfx.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/258306/original/file-20190211-174870-1wf7jfx.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">The Canadian government approved the sale of genetically modified golden rice that’s fortified with Vitamin A. It’s an example of a GM food that directly benefits consumers.</span>
<span class="attribution"><span class="source">Josep Folta/Flickr</span></span>
</figcaption>
</figure>
<p>And the <a href="https://www.foreignaffairs.com/articles/2018-04-10/gene-editing-good">biggest benefit</a> may be for the world’s poor. Basically, gene editing is doing what animal and plant breeders have been doing for hundreds and hundreds of years, only in a way that’s much faster, much cheaper and much more specific. </p>
<p>The only challenge? Reducing unfounded fears and communicating the incredible potential of genetically modified crops and foods in a way that Canadians can fully embrace.</p>
<h2>Protecting our pollinators</h2>
<p>In recent years, the humble bee has gone from picnic pest to cause célèbre. The decline of bee populations and its potential impact on food resources has Canadians rallying in support. And with good reason — <a href="https://doi.org/10.1098/rspb.2006.3721">a third of the world’s crops rely on pollinators</a>.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/258308/original/file-20190211-174861-1s5a1wp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/258308/original/file-20190211-174861-1s5a1wp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=395&fit=crop&dpr=1 600w, https://images.theconversation.com/files/258308/original/file-20190211-174861-1s5a1wp.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=395&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/258308/original/file-20190211-174861-1s5a1wp.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=395&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/258308/original/file-20190211-174861-1s5a1wp.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=496&fit=crop&dpr=1 754w, https://images.theconversation.com/files/258308/original/file-20190211-174861-1s5a1wp.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=496&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/258308/original/file-20190211-174861-1s5a1wp.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=496&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">A third of the world’s crops need pollinators like bees. But some of them also require pesticides that are harmful to bees.</span>
<span class="attribution"><span class="source">Jenna Lee/Unsplash</span></span>
</figcaption>
</figure>
<p>In Canada, the contribution of bees to crops like apples, blueberries and canola <a href="http://www.agr.gc.ca/eng/industry-markets-and-trade/canadian-agri-food-sector-intelligence/horticulture/horticulture-sector-reports/statistical-overview-of-the-canadian-honey-and-bee-industry-and-the-economic-contribution-of-honey-bee-pollination-2016/?id=1510864970935#a5">has been estimated at over $5 billion.</a> </p>
<p>So shouldn’t we all be behind the bee? It’s not that simple. </p>
<p>While they are essential for some crops, other crops rely on methods of pest control that are associated with the decline of pollinators. </p>
<p>As we’ve seen with the neonicotinoids debate, striking a delicate balance between the needs of farmers and the protection of pollinators is an ongoing challenge and a goal that will not be easily achieved.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/why-its-time-to-curb-widespread-use-of-neonicotinoid-pesticides-96620">Why it's time to curb widespread use of neonicotinoid pesticides</a>
</strong>
</em>
</p>
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<h2>Canada is high on cannabis edibles</h2>
<p>Cannabis will soon be a major driver in the food and beverage category. This year should see edible products incorporated into Bill C-45 (the Cannabis Act), opening up opportunities for health foods and supplements, snack foods, packaged meals, restaurants and tourism.</p>
<p>A recent <a href="https://www2.deloitte.com/content/dam/Deloitte/ca/Documents/consulting/ca-cannabis-2018-report-en.PDF">Deloitte report</a> found that 58 per cent of current Canadian cannabis users intend to consume edibles once they’re legalized. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/258310/original/file-20190211-174880-uqlyx1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/258310/original/file-20190211-174880-uqlyx1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/258310/original/file-20190211-174880-uqlyx1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/258310/original/file-20190211-174880-uqlyx1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/258310/original/file-20190211-174880-uqlyx1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/258310/original/file-20190211-174880-uqlyx1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/258310/original/file-20190211-174880-uqlyx1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Most Canadian cannabis users say they intend to consume edibles once they’re legal.</span>
<span class="attribution"><span class="source">Shutterstock</span></span>
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</figure>
<p>But these highs do have some potential lows — work will need to be done to ensure proper dosing and to prevent unintended secondary consumption by children and pets. </p>
<p>As well, the path to market for cannabis products in Canada goes through three different pieces of legislation: the Cannabis Act, the Controlled Drugs and Substances Act and the Food and Drugs Act. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/how-to-keep-your-pets-safe-from-marijuana-poisoning-109134">How to keep your pets safe from marijuana poisoning</a>
</strong>
</em>
</p>
<hr>
<p>In addition, products for medical consumers must also meet the Access to Cannabis for Medical Purposes Regulations that are included in the Controlled Drugs and Substances Act. But with the total market estimated at more than $7 billion (on par with Canada’s wine industry), the future is nonetheless bright for cannabis companies.</p>
<h2>Prospering in a time of protectionism</h2>
<p>The whirlwind of trade deals and disputes in the past few years has left many Canadians reeling. While there has been much hand-wringing over inter-provincial barriers, NAFTA/USMCA and new agreements with Europe and the Pacific Rim, freer trade in food has actually provided Canadian farmers with markets that are hungry for our products. </p>
<p>Plus, Canadian consumers have benefited and now enjoy a wider range of affordable food products. </p>
<p>The one downside? Our regulated dairy industry, along with other supply managed commodities, has ceded nearly 10 per cent of its market through recent trade deals.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/in-defence-of-canadas-dairy-farmers-105774">In defence of Canada's dairy farmers</a>
</strong>
</em>
</p>
<hr>
<p>This will not only be painful for the dairy sector, but it isn’t likely to result in lower prices for Canadians — although we will probably see a broader array of cheeses and other dairy products. Overall, though, trade has been good for Canada and will continue to be for the foreseeable future.</p>
<h2>Growing divide between food & farms</h2>
<p>Farms may feed people, but they have very little to do with the price you pay for food. </p>
<figure class="align-left zoomable">
<a href="https://images.theconversation.com/files/258314/original/file-20190211-174861-1rhvxyg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/258314/original/file-20190211-174861-1rhvxyg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/258314/original/file-20190211-174861-1rhvxyg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=445&fit=crop&dpr=1 600w, https://images.theconversation.com/files/258314/original/file-20190211-174861-1rhvxyg.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=445&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/258314/original/file-20190211-174861-1rhvxyg.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=445&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/258314/original/file-20190211-174861-1rhvxyg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=559&fit=crop&dpr=1 754w, https://images.theconversation.com/files/258314/original/file-20190211-174861-1rhvxyg.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=559&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/258314/original/file-20190211-174861-1rhvxyg.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=559&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">A farmer is seen on his Nova Scotia farm in 2014 with some of his laying hens.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Andrew Vaughan</span></span>
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</figure>
<p>Fluctuating prices of agricultural commodities like corn, wheat or soybeans often fuel news stories but the reality is the increases in food prices Canadians have seen over the years have been relatively consistent. </p>
<p>Put simply, food and farm prices are not the same and the relationship between the two continues to weaken. Today, the <a href="https://www.fb.org/market-intel/farmers-share-of-food-dollar-at-record-low">farmers’ share</a> of the food dollar is around 20 per cent — higher for less processed foods (nearly 50 per cent for eggs) and lower for more processed foods (two per cent for corn, which is used as a sweetener in manufactured food products). </p>
<p>While the effect of low commodity prices may be felt in farming regions and associated industries, it has little impact on Canadians when they’re checking off their grocery lists — and that isn’t expected to change in 2019.</p><img src="https://counter.theconversation.com/content/111469/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michael von Massow receives funding from the Ontario Ministry of Agriculture and Food to research issues in food waste and nutrition labeling for restaurant menus. He has received funding from the Walmart Foundation to explore food waste at the household level. He has received money from the Tim Hortons Sustainable Food Management Fund to explore consumer attitudes to antibiotic use and animal welfare. He has also received funding from Longo's Brothers Markets in support of research into consumer behaviour in food retail.</span></em></p><p class="fine-print"><em><span>Aaron De Laporte receives funding from the Ontario Ministry of Agriculture, Food and Rural Affairs. </span></em></p><p class="fine-print"><em><span>Alfons Weersink receives funding from the Ontario Ministry of Agriculture, Food and Rural Affairs, and the Canada First Research
Excellence Fund’s Food from Thought Initiative. </span></em></p><p class="fine-print"><em><span>Liam D. Kelly does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The six food trends likely to be front and centre in 2019.Michael von Massow, Associate Professor, Food Economics, University of GuelphAaron De Laporte, Research Associate, University of GuelphAlfons Weersink, Professor, Dept of Food, Agricultural and Resource Economics, University of GuelphLiam D. Kelly, Ph.D. Candidate, University of GuelphLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1106692019-01-30T11:50:56Z2019-01-30T11:50:56ZWhat 4 economists say about the state of the union<figure><img src="https://images.theconversation.com/files/256245/original/file-20190130-108370-i72fu0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">A hallowed chamber for an important address.
</span> <span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/New-Congress/d39327d207fd428f9125a25a31bc2725/8/0">AP Photo/J. Scott Applewhite</a></span></figcaption></figure><p>President Donald Trump <a href="https://www.washingtonpost.com/politics/2019/02/04/everything-you-need-know-about-state-union/?utm_term=.e4a8e1daf1de">plans to deliver</a> an “aspirational” and “visionary” State of the Union address on Feb. 5, calling on Congress to work with him on bipartisan issues like infrastructure and health care. </p>
<p>The speech was delayed by a week after <a href="https://theweek.com/speedreads/819391/pelosis-state-union-letter-trump-apparently-caught-white-house-guard">Speaker of the House Nancy Pelosi disinvited</a> Trump until he ended the partial government shutdown. </p>
<p>Meanwhile, we asked four economists to give us their own assessments of the state of the union, as well as the president’s performance so far. Each picked a theme.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/256425/original/file-20190130-103164-1ntr6bx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/256425/original/file-20190130-103164-1ntr6bx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/256425/original/file-20190130-103164-1ntr6bx.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/256425/original/file-20190130-103164-1ntr6bx.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/256425/original/file-20190130-103164-1ntr6bx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/256425/original/file-20190130-103164-1ntr6bx.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/256425/original/file-20190130-103164-1ntr6bx.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">A new joint venture between Siemens and Chromalloy in Gibsonton, Florida, is creating about 350 new jobs on a $139 million investment.</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Siemens-and-Chromalloy-Manufacturing-Plant-Opening/54d4160f47244827abc0d8149afea969/6/0">AP Photo/Casey Brooke Lawson</a></span>
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</figure>
<h2>State of business investment: Strong growth but trouble looms</h2>
<p><strong>Ellen Hughes-Cromwick, University of Michigan</strong></p>
<p>Business investment, the <a href="https://www.bea.gov/system/files/2018-12/gdp3q18_3rd_1.pdf">lifeblood improving the nation’s standard of living</a>, has been one of the big economic bright spots fueling strong growth in the past couple years. </p>
<p>Combined with a healthy labor market, solid spending on new plants, equipment and intellectual property are all achievements in this near-decade-long expansion. Without it, expanding possibilities and the promise of new horizons for the next generation could be lost. </p>
<p>Signs suggest the party is about to end. </p>
<p>U.S. inflation-adjusted business investment in plant, equipment and intellectual property <a href="https://www.bea.gov/system/files/2018-12/gdp3q18_3rd_1.pdf">jumped 5.6 percent</a> in the first three quarters of 2018, putting it on pace for the <a href="https://fred.stlouisfed.org/graph/?id=PNFIC1">fastest year</a> since 2014. That’s being fueled by record corporate profits – US$2.3 trillion in the third quarter. They surged 7.9 percent in the first three quarters of 2018, the <a href="https://fred.stlouisfed.org/series/CPROFIT">most in the same period since 2012</a>. </p>
<p>The <a href="http://pages.stern.nyu.edu/%7Eadamodar/New_Home_Page/datafile/capex.html">biggest gains</a> in investment are in energy, telecommunications, automotive and technology sectors.</p>
<p>While the Trump administration may want to claim credit for the investment by pointing to its tax overhaul from late 2017, the <a href="https://theconversation.com/hot-potato-shows-why-workers-wont-benefit-from-trumps-corporate-tax-cut-86878">Tax Cuts and Jobs Act of 2017</a> <a href="https://taxfoundation.org/final-tax-cuts-and-jobs-act-details-analysis/">was not responsible</a> for the strong investment. Rather, it was healthy financial markets, <a href="https://www.cnbc.com/2019/01/21/imf--cuts-global-growth-outlook-2019-2020.html">strong global economic growth</a> and rising corporate profits that deserve most of the credit. </p>
<p>Indeed, the pace of business investment <a href="https://fred.stlouisfed.org/graph/?id=PNFIC1">was similarly strong</a> in 2017, with no notable improvement after the tax law passed that December. And a recent survey showed that the vast majority of businesses said <a href="https://nabe.com/NABE/Surveys/Business_Conditions_Surveys/January_2019_Business_Conditions_Survey_Summary.aspx">they did not change their hiring or investment plans</a> as a result of the tax cut. </p>
<p>Looking forward, trouble seems to be brewing in terms of business conditions. <a href="https://www.wsj.com/articles/new-data-from-china-and-europe-fan-economic-fears-11544803738">China’s and Europe’s economies are slowing</a>, and financial conditions are tightening as <a href="https://theconversation.com/could-a-recession-be-just-around-the-corner-108372">equity markets wobble</a> and the Federal Reserve continues to raise interest rates and trim its enormous balance sheet. As a result, economic forecasters are lowering their <a href="https://www.wsj.com/graphics/econsurvey/">growth outlook for 2019</a>, while the risks of recession are rising.</p>
<p>In all likelihood, those warning signs should put a damper on business investment.</p>
<h2>State of the national debt: Sky’s the limit</h2>
<p><strong>Steven Pressman, Colorado State University</strong></p>
<p>As a candidate, Trump <a href="https://www.bloomberg.com/news/articles/2017-03-09/trump-promised-to-eliminate-national-debt-in-eight-years-good-luck-with-that">promised to eliminate America’s national debt</a> in eight years through faster economic growth. How’s he done so far?</p>
<p>Not so good. The debt <a href="https://fred.stlouisfed.org/series/GFDEBTN">has climbed from $20 trillion</a> when Trump took office to $21.5 trillion at the end of 2018.</p>
<p>The budget deficit – or the difference between government revenues and spending – is what changes the national debt. After falling continuously from $1.4 trillion in 2009 at the end of the Great Recession to $585 billion in 2016, the U.S. budget deficit has risen during the Trump presidency. It <a href="https://www.cbo.gov/publication/54647">hit $779 billion</a> in 2018, the highest level since 2012, and is expected to reach $900 billion this year. </p>
<p>The two main forces driving this are greater spending on the <a href="https://www.nytimes.com/2018/02/08/us/politics/congress-budget-deal-vote.html?module=inline">military and disaster relief</a> and the 2017 tax cut, which <a href="https://www.pgpf.org/blog/2018/10/corporate-tax-receipts-were-down-by-nearly-one-third-in-fiscal-year-2018">reduced corporate income taxes by $92 billion</a>. </p>
<p>The Trump administration, and the Republicans who pushed for the tax cut, <a href="https://www.vox.com/policy-and-politics/2017/5/4/15536394/american-economists-trump-tax-plan">promised that economic growth</a> would increase tax revenues and offset the losses. <a href="https://www.vox.com/policy-and-politics/2017/5/4/15536394/american-economists-trump-tax-plan">Most economists</a>, <a href="https://theconversation.com/hot-potato-shows-why-workers-wont-benefit-from-trumps-corporate-tax-cut-86878">including me</a> were skeptical that corporate tax cuts would substantially increase investment and economic growth. So far, the <a href="https://www.washingtonpost.com/business/2018/10/27/trump-tax-cuts-were-supposed-set-off-an-investment-boom-they-arent-so-far/?utm_term=.d40b039cf5e7">data supports the skeptics</a>. </p>
<p>The greatest problem, however, is that budget deficits should fall during economic expansions. This provides more policy flexibility whenever the next recession hits. </p>
<p>During recessions, tax receipts fall and government spending rises, pushing up the deficit. The appropriate fiscal policy response – increase the budget deficit even more – becomes harder the larger it already is. </p>
<h2>State of trade: Uncertainty and trade wars</h2>
<p><strong>James Lake, Southern Methodist University</strong></p>
<p>American trade with the world is crucial to the U.S. economy, <a href="https://data.worldbank.org/indicator/NE.TRD.GNFS.ZS?locations=US">exceeding 25 percent</a> of gross domestic product. But with uncertainty over tariffs, trade wars and trade agreements keeping U.S. businesses on their toes, the state of trade is in flux. </p>
<p>The raw numbers tell a mixed story. After increasing for six straight quarters, the brunt of strong <a href="https://www.cnbc.com/2018/11/28/us-gdp-q3-2018.html">foreign retaliation</a> over Trump’s tariffs pushed U.S. exports down 1.24 percent in the third quarter of 2018, the latest data available. It’s the biggest fall <a href="https://fred.stlouisfed.org/series/EXPGSC1#0">since the depths of the Great Recession</a> in 2009.</p>
<p>At the same time, imports <a href="https://fred.stlouisfed.org/series/IMPGSC1#0">jumped that quarter</a> as U.S. companies wary of higher tariffs on Chinese goods stocked up. <a href="https://fred.stlouisfed.org/series/XTIMVA01CNQ664S#0">Imports from China surged</a> 11.1 percent, the most since 2011. </p>
<p>As a result, America’s trade deficit with the world – one of the president’s most-cited metrics and a reason <a href="https://www.forbes.com/sites/kenrapoza/2018/08/20/trade-war-sees-deficit-ballooning/">he’s fighting his trade wars</a> – <a href="https://fred.stlouisfed.org/series/BOPGSTB">widened to a 10-year high</a>. </p>
<p>The Trump administration has spent the <a href="https://www.bbc.com/news/business-44529600">better part of the past year</a> escalating its war of words and tariffs with China, with tit-for-tat trade barriers being hurled back and forth. Trump’s tariffs on $200 billion of Chinese goods were set to <a href="https://www.nytimes.com/2018/12/02/business/trade-truce-china-us.html">ratchet up</a> from 10 percent to 25 percent in January until he and Chinese President Xi Jinping <a href="https://www.scmp.com/news/china/diplomacy/article/2175984/xi-jinping-says-cooperation-best-choice-both-sides-dinner">agreed to a three-month truce</a> to come to a deal. The deadline is March 1. </p>
<p>But rather than leading to Chinese concessions, Trump’s strong-arm negotiating tactics <a href="https://www.reuters.com/article/us-usa-trade-china-wto/china-brings-u-s-tariff-dispute-to-wto-berates-washington-for-blocking-judges-idUSKCN1PM1YJ">have led to a new suit</a> this month against the U.S. at the World Trade Organization. And, despite continuing to <a href="https://www.nytimes.com/2019/01/28/us/politics/meng-wanzhou-huawei-iran.html">push hard</a> on Chinese telecom giant <a href="https://theconversation.com/us/search?utf8=%E2%9C%93&q=huawei&sort=relevancy&language=en&date=all&date_from=&date_to=">Huawei</a>, there’s now talk that the Trump administration’s <a href="https://www.wsj.com/articles/u-s-weighs-lifting-china-tariffs-to-hasten-trade-deal-calm-markets-11547754006">tariff stance may be softening</a>. </p>
<p>All of this uncertainty together with the higher tariffs are starting to hurt markets as well as <a href="https://www.investopedia.com/news/trade-uncertainty-already-hurting-us-companies/">companies</a> like <a href="https://www.reuters.com/article/us-caterpillar-results/caterpillar-stock-slides-on-profit-miss-china-sales-forecast-idUSKCN1PM1CL">U.S. manufacturing bellwether Caterpillar</a> and <a href="https://www.bloomberg.com/news/articles/2019-01-29/harley-profit-wiped-out-by-tariffs-as-sales-continue-slumping?srnd=premium">iconic motorcycle maker Harley-Davidson</a>.</p>
<p>Another major area of concern has been the renegotiation of the North American Free Trade Agreement, which lasted some 18 months and resulted in a deal that looked <a href="https://thehill.com/opinion/finance/411133-us-farmers-relieved-new-nafta-looks-a-lot-like-old-nafta">strikingly similar</a> to the original. There were some modest changes for the <a href="https://www.cnbc.com/2018/10/24/fed-says-the-new-nafta-isnt-going-to-help-us-dairy-farmers.html">dairy</a> and <a href="https://www.washingtonexaminer.com/policy/economy/usmca-deal-may-pressure-white-house-to-add-auto-tariffs-too">auto</a> industries, but by and large it was the same old agreement. </p>
<p>Nevertheless, Congress still needs to actually vote on the new deal, known as the U.S.-Mexico-Canada Agreement, and newly empowered Democrats <a href="https://www.ft.com/content/6f1b275a-1b43-11e9-9e64-d150b3105d21">are talking about reopening the deal</a> to demand stronger labor and environmental protections. </p>
<p>And, unsurprisingly, Trump is once again <a href="https://www.ft.com/content/6f1b275a-1b43-11e9-9e64-d150b3105d21">threatening to withdraw</a> from the pact altogether. So, more uncertainty ahead for U.S. business, workers and consumers.</p>
<h2>State of health care: High mortality, higher costs</h2>
<p><strong>David Bishai, John Hopkins University</strong></p>
<p>In his inaugural address, Trump <a href="https://www.washingtonpost.com/news/the-fix/wp/2017/01/20/donald-trumps-full-inauguration-speech-transcript-annotated/">vowed</a> to end “American carnage.” If carnage is measured in American mortality, things are are not getting better, unfortunately. </p>
<p>U.S. life expectancy <a href="https://www.aafp.org/news/health-of-the-public/20181210lifeexpectdrop.html">fell to 78.6 years</a> at the end of 2017 – the latest data available. This continues a slide from 2015, the <a href="https://www.cnn.com/2017/12/21/health/us-life-expectancy-study/index.html">first time it has shown a sustained three-year fall</a> in four decades, according to the Centers for Disease Control. Comparable countries like <a href="https://www150.statcan.gc.ca/n1/en/subjects/health/life_expectancy_and_deaths">Canada</a>,<a href="https://www.gapminder.org/tools">the U.K., France and Germany</a> continue to see life expectancy climbing well above 80. </p>
<p>One of the big reasons is the <a href="https://theconversation.com/us/topics/opioid-epidemic-26182">opioid epidemic</a>, which is estimated to have cost the economy <a href="https://www.cnbc.com/2018/02/12/economic-cost-of-the-opioid-crisis-1-trillion-and-growing-faster.html">$1 trillion</a> from 2001 to 2017. Every <a href="https://jhsph.co1.qualtrics.com/jfe/form/SV_bfKM5PUnncDgALz">state in the union</a> is seeing epidemics of <a href="https://www.cdc.gov/nchs/products/databriefs/db328.htm">drug overdoses, suicide</a> and <a href="https://www.washingtonpost.com/news/wonk/wp/2015/12/22/americans-are-drinking-themselves-to-death-at-record-rates/?noredirect=on">alcohol related deaths</a> despite better access to health insurance. </p>
<p>States that expanded access to health insurance showed <a href="https://ldi.upenn.edu/healthpolicysense/medicaid-expansion-and-opioid-epidemic">slower growth</a> of drug overdose mortality and <a href="https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2696873">increased</a> access to rehabilitative treatment for addiction. The Affordable Care Act helped <a href="https://www.kff.org/uninsured/fact-sheet/key-facts-about-the-uninsured-population">cut the share of uninsured Americans</a> from 17 percent in 2013 to 10 percent in 2015, where they have remained. </p>
<p>Better insurance also brings access to services that have lowered death rates from <a href="https://www.cdc.gov/nchs/products/databriefs/db328.htm">congenital malformations, heart disease and cancer</a>. Yet the ACA is not a panacea and has not prevented lethal epidemics from sweeping the nation.</p>
<p>This is especially frustrating because Americans spend <a href="https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/index.html">18 percent of GDP</a> on health care, or $10,739 for every man, woman and child.</p>
<p>So the problem isn’t spending. It’s how we spend it. <a href="http://dx.doi.org/10.5888/pcd14.170017.">Research</a> and real-world examples are showing how communities bringing together multiple groups outside of health care to pursue various approaches can lead to promising results. Examples include <a href="https://www.nytimes.com/2018/11/25/health/opioid-overdose-deaths-dayton.html">cutting overdose death rates</a> in Dayton, Ohio, and <a href="https://www.projectlazarus.org/our-story">Wilkes County, North Carolina</a>. </p>
<p>That’s the best way to finally stem the flow of American carnage.</p><img src="https://counter.theconversation.com/content/110669/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ellen Hughes-Cromwick receives funding from Sloan Foundation to fund student scholarships to attend our Transportation, Energy, Economics, and the Environment Conference. Ellen is affiliated with American Economic Association, National Association for Business Economics, Board of Trustees of Clark University, NABE Foundation, WorkingNation, and a Senior Advisor for Macro Policy Perspectives, LLC.
</span></em></p><p class="fine-print"><em><span>David Bishai, James Lake, and Steven Pressman do not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>As Trump prepares to deliver his delayed State of the Union address, here’s what four economists had to say about the state of the union.David Bishai, Professor of Health Economics, Johns Hopkins UniversityEllen Hughes-Cromwick, Senior Economist and Associate Director of Social Science and Policy, University of Michigan Energy Institute, University of MichiganJames Lake, Associate Professor of Economics, Southern Methodist UniversitySteven Pressman, Professor of Economics, Colorado State UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1075122018-12-18T22:00:14Z2018-12-18T22:00:14ZThe fossil fuel era is coming to an end, but the lawsuits are just beginning<figure><img src="https://images.theconversation.com/files/250691/original/file-20181214-185268-ullhip.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">A coal mine near the mountains in Alberta.</span> <span class="attribution"><span class="source">(Shutterstock)</span></span></figcaption></figure><p>“Coal is dead.” </p>
<p>These are not the words of a Greenpeace activist or left-wing politician, but of Jim Barry, the global head of the infrastructure investment group at Blackrock — the world’s largest asset manager. Barry <a href="https://www.afr.com/business/mining/coal/blackrock-says-coal-is-dead-as-it-eyes-renewable-power-splurge-20170524-gwbuu6">made this statement in 2017</a>, but <a href="https://www.theguardian.com/environment/2015/aug/19/coal-mining-sector-running-out-of-time-says-citigroup">the writing has been on the wall</a> for longer than that. </p>
<p><a href="https://www.sc.com/en/explore-our-world/here-for-good-means-saying-no-to-coal/">Banks know it</a>, which is why they are increasingly unwilling to underwrite new coal mines and power plants. Unions and coal workers know it, which is why they are demanding a <a href="https://www.ituc-csi.org/just-transition-centre">just transition</a> and new employment opportunities in the clean economy. Even <a href="https://www.abc.net.au/news/2018-03-28/rio-tinto-sells-last-coal-mine-kestrel/9597352">large diversified mining companies</a> are getting out of the business of coal. </p>
<p>The only ones who seem to have remained in denial are <a href="https://www.cnbc.com/2018/08/23/trump-says-the-coal-industry-is-back-the-data-say-otherwise.html">President Donald Trump</a> and non-diversified mining companies like <a href="http://ieefa.org/wp-content/uploads/2018/02/Westmoreland-Coal-Is-in-Trouble_February-2018.pdf">Westmoreland Coal</a>. The Denver-based firm made a bad bet in 2013 when it purchased five coal mines in Alberta. Now it wants Canadian taxpayers to pay for its mistake.</p>
<h2>Alberta’s coal phaseout</h2>
<p>Three years ago, Alberta’s New Democratic Party (NDP) committed to what some have described as “<a href="https://www.iisd.org/sites/default/files/publications/alberta-coal-phase-out.pdf">the most ambitious climate plan in North America to date</a>.” In addition to the development of an economy-wide carbon price, the province is <a href="https://www.alberta.ca/climate-coal-electricity.aspx">phasing out coal-fired power by 2030</a>. Without the infrastructure to export coal, the climate plan has also resulted in a de facto phaseout of local thermal coal mining. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/250698/original/file-20181214-185258-10h0kri.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/250698/original/file-20181214-185258-10h0kri.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/250698/original/file-20181214-185258-10h0kri.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/250698/original/file-20181214-185258-10h0kri.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/250698/original/file-20181214-185258-10h0kri.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/250698/original/file-20181214-185258-10h0kri.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/250698/original/file-20181214-185258-10h0kri.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Premier Rachel Notley unveils Alberta’s climate strategy in Edmonton on Nov. 22, 2015.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Amber Bracken</span></span>
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Read more:
<a href="https://theconversation.com/do-climate-policies-kill-jobs-an-economist-on-why-they-dont-cause-massive-unemployment-106928">Do climate policies ‘kill jobs’? An economist on why they don’t cause massive unemployment</a>
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<p>To ensure support for the plan, major utility companies in the province were provided with “<a href="https://www.alberta.ca/release.cfm?xID=44889F421601C-0FF7-A694-74BB243C058EE588">transition payments</a>” to facilitate the switch to gas and renewable energy. Westmoreland did not receive a government handout, because coal mining companies have no role to play in the energy transition. The company, which <a href="https://www.huffingtonpost.ca/entry/westmoreland-coal-bankruptcy_us_5bbd9907e4b01470d056cd3d">filed for bankruptcy</a> protection for its investments in the United States in October, doesn’t think this is fair. </p>
<h2>NAFTA’s investment chapter</h2>
<p>Because Westmoreland is an American company, it can rely on the North American Free Trade Agreement (NAFTA) for protection from <a href="http://ccsi.columbia.edu/files/2018/09/Rethinking-Investment-Governance-September-2018.pdf">“unfair” treatment</a>. NAFTA allows a foreign investor to use a process known as “Investor-State Dispute Settlement” (ISDS) when government action harms its business in some way. </p>
<p>ISDS allows foreign investors to bypass local courts and bring claims for monetary compensation to an international tribunal. The system is not unique to NAFTA; it is found in other trade agreements like the <a href="https://international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/cptpp-ptpgp/index.aspx?lang=eng">Comprehensive and Progressive Agreement for Trans Pacific Partnership (CPTPP)</a> and thousands of <a href="https://investmentpolicyhub.unctad.org/IIA">bilateral investment treaties</a> (known as <a href="https://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/index.aspx?lang=eng">Foreign Investment Promotion and Protection Agreements</a> in Canada). </p>
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<strong>
Read more:
<a href="https://theconversation.com/the-big-challenge-of-the-nafta-renegotiations-dispute-settlement-82394">The big challenge of the NAFTA renegotiations: dispute settlement</a>
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<p>ISDS is hugely controversial. Concerns have been raised by a wide range of actors about both the <a href="https://www.cigionline.org/articles/it-time-redesign-or-terminate-investor-state-arbitration">process of ISDS</a>, and the way the system can infringe on the <a href="https://www.ohchr.org/EN/NewsEvents/Pages/DisplayNews.aspx?NewsID=19839&LangID=E">sovereign right of states to regulate to protect public health, human rights and the environment</a>. </p>
<p>More than <a href="https://investmentpolicyhub.unctad.org/ISDS">900 ISDS cases</a> have been launched by investors since the early 1990s, including <a href="http://www.international.gc.ca/trade-agreements-accords-commerciaux/topics-domaines/disp-diff/gov.aspx?lang=eng">27 against Canada</a> that have so far cost Canadian taxpayers <a href="https://www.policyalternatives.ca/sites/default/files/uploads/publications/National%20Office/2018/01/NAFTA%20Dispute%20Table%20Report%202018.pdf">at least $315 million</a>. There is one <a href="http://www.international.gc.ca/trade-agreements-accords-commerciaux/topics-domaines/disp-diff/lone.aspx?lang=eng">ongoing dispute</a> that concerns a ban on gas fracking in Québec, but the Westmoreland claim is the first brought in relation to a policy explicitly designed to combat climate change.</p>
<p><a href="https://www.theglobeandmail.com/business/article-westmoreland-coal-launches-nafta-suit-against-alberta-over-coal-phase/">Westmoreland argues</a> that part of the reason it invested in Canada in 2013 was to diversify its holdings in response to regulatory risk. At the time, the Obama Administration was <a href="https://www.theguardian.com/environment/2015/aug/03/obamas-clean-power-plan-hailed-as-strongest-ever-climate-action-by-a-us-president">taking action under the Clean Power Plan</a> to reduce the reliance of American utilities on coal. The company’s failure to anticipate similar regulatory action by its northern neighbour is remarkable. </p>
<h2>A key battleground</h2>
<p>If governments respond appropriately to the <a href="http://www.ipcc.ch/report/sr15/">urgent warning issued by the Intergovernmental Panel on Climate Change (IPCC)</a> in October, efforts to phase out fossil fuels will have to ramp up considerably — and quickly. We should expect the industry to fight these efforts through a variety of means. ISDS may become a key battleground.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/250701/original/file-20181214-185258-otlt29.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/250701/original/file-20181214-185258-otlt29.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/250701/original/file-20181214-185258-otlt29.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/250701/original/file-20181214-185258-otlt29.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/250701/original/file-20181214-185258-otlt29.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/250701/original/file-20181214-185258-otlt29.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/250701/original/file-20181214-185258-otlt29.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">President Donald Trump, Prime Minister Justin Trudeau, right, and President Enrique Pena Nieto, left, participate in the USMCA signing ceremony, Nov. 30, 2018 in Buenos Aires, Argentina.</span>
<span class="attribution"><span class="source">(AP Photo/Pablo Martinez Monsivais)</span></span>
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</figure>
<p>The <a href="http://international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/usmca-aeumc/summary-sommaire.aspx?lang=eng">U.S.-Mexico-Canada Agreement</a> (USMCA or CUSMA, <a href="https://www.thestar.com/news/world/2018/11/30/usmca-cusma-what-the-new-nafta-is-called-depends-on-whos-talking.html">depending on who is talking about it</a>), which may replace NAFTA (it has been signed, but has not been ratified), <a href="https://www.iisd.org/library/usmca-investors">does not retain the process of ISDS between Canada and the U.S.</a></p>
<p>While this is good news in the long run, some have suggested that there will be a “<a href="https://worldtradelaw.typepad.com/ielpblog/2018/10/the-us-mexico-and-maybe-nafta-trade-deal-investment-protectionisds.html">rush of filings</a>” before access to ISDS for already established investors expires (three years after USMCA comes into force). Canada will also be exposed to claims from investors under other agreements such as the CPTPP and <a href="https://international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/ceta-aecg/index.aspx?lang=eng">Canada-European Union Comprehensive Economic and Trade Agreement (CETA)</a>.</p>
<p>Other countries, particularly poorer nations, face an even higher risk of ISDS claims and have far <a href="https://www.iisd.org/sites/default/files/publications/stakes-are-high-review-financial-costs-investment-treaty-arbitration.pdf">less resources available to fight them</a>. It is notable that <a href="https://www.sierraclub.org/trade/trump-s-nafta-deal-threatens-our-air-water-and-climate">big oil companies have retained some access to ISDS against Mexico</a> in USMCA, after <a href="https://www.washingtonpost.com/news/powerpost/paloma/the-energy-202/2018/10/03/the-energy-202-big-oil-and-gas-companies-are-winners-in-trump-s-new-trade-deal/5bb39b531b326b7c8a8d17cc">lobbying hard for it</a>. </p>
<h2>A climate of fear?</h2>
<p>If Westmoreland’s case proceeds to arbitration, it will not have direct implications for Alberta’s climate policy. An investment tribunal cannot require the provincial government to reverse the coal phaseout; it can only award the company damages. Westmoreland is asking for US$470 million. It is <a href="https://scholarlycommons.law.case.edu/cuslj/vol37/iss1/22/">the federal government, rather than Alberta, that would have to pay</a> compensation to Westmoreland if the company’s claim was successful. However, <a href="https://globalnews.ca/news/3378321/ontario-pays-28-million-awarded-to-wind-company-over-offshore-wind-moratorium/">Ontario did agree to pay the award</a> in a recent NAFTA case.</p>
<p>What is more concerning than any potential payout is that Westmoreland’s suit could hinder efforts to implement similar plans to combat climate change in other jurisdictions. </p>
<p>“<a href="https://doi.org/10.1017/S2047102517000309">Regulatory chill</a>” is a phenomenon that has been observed in several jurisdictions around the world. A notable example is the decision of the <a href="https://www.nzma.org.nz/journal/read-the-journal/all-issues/2010-2019/2018/vol-131-no-1473-13-april-2018/7540">New Zealand government to delay the introduction of legislation to require plain packaging of tobacco products</a> until Australia won its <a href="https://www.theguardian.com/business/2018/jul/02/revealed-39m-cost-of-defending-australias-tobacco-plain-packaging-laws">ISDS case against the tobacco company Philip Morris International</a>. This delay of regulatory action — out of fear of expensive litigation — may have cost lives. </p>
<p>As recent <a href="https://www.huffingtonpost.com/entry/camp-fire-death-toll-88_us_5bfcd3f0e4b0771fb6bd6ba1">forest fires</a> and <a href="https://www.theatlantic.com/photo/2018/08/devastating-monsoon-floods-in-kerala-india/568171/">floods</a> have demonstrated, delays in action to combat climate change can also be deadly.</p><img src="https://counter.theconversation.com/content/107512/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Kyla Tienhaara receives funding from the Government of Canada under the Canada Research Chairs Program.</span></em></p>An American coal company is suing the Canadian government over Alberta’s plan to combat climate change.Kyla Tienhaara, Canada Research Chair in Economy and Environment, Queen's University, OntarioLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1046712018-11-29T11:36:58Z2018-11-29T11:36:58ZTrump was dealt a winning hand on trade – his hardball negotiating tactics are squandering it<figure><img src="https://images.theconversation.com/files/247377/original/file-20181126-140534-5q1bf8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Trump had a full hand, but he may have squandered it.</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/pair-aces-chips-blackjack-winning-hand-1184225827?src=CIsUunPVUtu0rp6xxuoNJw-1-6">Happy Author/shutterstock.com</a></span></figcaption></figure><p>As President Donald Trump <a href="https://www.cnbc.com/2018/11/26/trade-is-the-only-bilateral-deal-trump-and-xi-can-discuss-commentary.html">prepares</a> to meet with his Chinese counterpart on the sidelines of the G-20 summit on Nov. 30, the stakes could hardly be higher. </p>
<p>The two countries are in the middle of a trade war Trump launched earlier this year, one of the hardball negotiating strategies he believes can extract more benefits from trading partners. Such “economic bullying” <a href="https://www.politico.com/story/2018/11/19/pressure-xi-trump-meet-g20-1003391">was blamed</a> for creating a first-ever deadlock at a recent Asia-Pacific Economic Cooperation meeting. </p>
<p>So far, China shows few signs of budging in the face of mounting tariffs. Could Trump’s tough talk work? Or will it backfire on him and the Americans he represents?</p>
<h2>Threats and humiliation</h2>
<p>Exhibit A for those who believe such tactics are effective is the <a href="https://theconversation.com/how-is-new-nafta-different-a-trade-expert-explains-104212">United States Mexico Canada Agreement</a>, negotiated to replace NAFTA. Trump used <a href="https://twitter.com/realdonaldtrump/status/788919099275390976?lang=en">threats</a>, <a href="http://www.latimes.com/opinion/la-ol-enter-the-fray-trump-s-tough-guy-negotiating-stance-1535753232-htmlstory.html">humiliation</a> and <a href="https://www.nytimes.com/2018/06/01/world/canada/steel-aluminum-trump-trade-ontario.html">punishing tariffs</a> to get Canada and Mexico to agree to the new deal.</p>
<p><a href="https://thegoldwater.com/news/38453-Trump-s-Negotiation-Brilliance-Displayed-in-Successful-USMCA-Trade-Deal">Supporters argue</a> this shows <a href="https://www.watershedassociates.com/negotiationblog/donald-trumps-art-deal-whats-his-final-grade">his brand of bluster</a> works. And that this strategy will help the U.S. win its trade war with China and get the better of the EU. </p>
<p>But even without the <a href="http://www.trumptwitterarchive.com/archive/China/ttff">taunting tweets</a>, Trump already has enormous leverage going into any trade negotiation, whether with Canada and Mexico, China or the EU. That’s because, as <a href="https://scholar.google.com/citations?user=Dj1KNt8AAAAJ&hl=en&oi=sra">my own research</a> <a href="https://doi.org/10.1111/ecin.12360">has shown</a>, boasting the <a href="https://www.weforum.org/agenda/2018/04/the-worlds-biggest-economies-in-2018/">world’s largest and strongest economy</a> puts the U.S. in a unique position to extract concessions from its partners.</p>
<p>Yet, despite this advantage and the blustery rhetoric, Trump hasn’t actually achieved all that much. And in negotiations with China, he may have already squandered some of his biggest chips. </p>
<h2>The US always has a strong hand</h2>
<p>Forgetting Trump’s negotiating tactics for a moment, the U.S. went to the bargaining table with Canada and Mexico with an inherently strong hand. And, the same will be true when arriving at the bargaining table with China and the EU. </p>
<p><a href="https://www.jstor.org/stable/2951352?casa_token=sSZ-nhWABpIAAAAA:3G2DceaYyQVpRmw-MGlduV4ZSXYqmUnzL-wQMS00mBnDNovipQT56SPfPBHh_WZU2eqZUnXInClBIQp5JHcaH4d7xcdoH2vD7zeu34yF-aeHJy6R2uqD&seq=1#metadata_info_tab_contents">Research</a> by economist John McLaren shows how small countries become more dependent on big ones when they integrate with each other. Indeed, recent <a href="https://cdn.theconversation.com/static_files/files/377/phaseOutsNAFTA.pdf?1543421844">research</a> of my own, together with economists Tibor Besedes and Tristan Kohl, says Canada and Mexico did become more dependent on the U.S. because of the North American Free Trade Agreement.</p>
<p>And <a href="https://doi.org/10.1093/qje/qjt016">empirical work</a> by economists Rod Ludema and Anna Maria Mayda shows countries like the U.S. with greater exporting power tend to get more market access during bilateral negotiations. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/247379/original/file-20181126-140516-1j8ptug.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/247379/original/file-20181126-140516-1j8ptug.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/247379/original/file-20181126-140516-1j8ptug.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/247379/original/file-20181126-140516-1j8ptug.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/247379/original/file-20181126-140516-1j8ptug.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/247379/original/file-20181126-140516-1j8ptug.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/247379/original/file-20181126-140516-1j8ptug.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Trump’s supporters argue that the new NAFTA deal with Canada and Mexico gives him a leg up.</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/US-Canada-Mexico-Trade/d315ceb2fa3c48ea95d00162870341eb/20/0">AP Photo/Manuel Balce Ceneta</a></span>
</figcaption>
</figure>
<h2>Threats and tariffs</h2>
<p>But, rather than focusing on playing the strong hand he was dealt, the president threatened to burn the house down. </p>
<p>For example, he’s been threatening to <a href="https://www.wsj.com/articles/donald-trump-lays-out-protectionist-views-in-trade-speech-1467145538">withdraw from NAFTA</a> since the 2016 U.S. presidential campaign and repeatedly tried to use his apparent eagerness to rip it up <a href="https://www.forbes.com/sites/phillevy/2018/01/22/the-nafta-withdrawal-threat-is-real/#11eb88aa6458">as a way to force</a> Canada and Mexico to the negotiating table. </p>
<p>He also imposed steep tariffs on steel and aluminum – new levies that adversely affect <a href="https://www.bloomberg.com/news/articles/2018-10-01/with-nafta-sorted-focus-shifts-to-aluminum-and-steel-tariffs">Canada and Mexico</a> much more than China. They’ve also hurt American carmakers, <a href="https://www.vox.com/business-and-finance/2018/11/26/18112988/general-motors-plant-closures-tariffs-trump">playing a part</a> in General Motor’s plan to close up to five plants in North America and lay off more than 14,000 workers. </p>
<p>Yet Trump used these steel and aluminum tariffs – as well as the <a href="https://business.financialpost.com/news/economy/trumps-auto-tariffs-threat-is-making-it-harder-to-secure-a-nafta-deal">specter of new and severe auto tariffs</a> – to back Canada and Mexico <a href="https://www.bloomberg.com/news/articles/2018-03-06/steel-tariffs-transform-into-nafta-chip-as-trump-plays-dealmaker">into a corner</a>, even though both are key allies. </p>
<p>Furthermore, after reaching a separate deal with Mexico in August, Trump used it to put even more pressure on Canada by <a href="https://www.nytimes.com/2018/08/27/us/politics/us-mexico-nafta-deal.html">threatening to exclude</a> America’s northern neighbor if it didn’t agree to their terms. </p>
<h2>Tough talk and modest gains</h2>
<p>And after all this, did he get “the <a href="https://www.forbes.com/sites/johnbrinkley/2018/10/08/usmca-is-not-the-magnificent-trade-deal-trump-says-it-is/#6bbe5ea34054">most important trade deal we’ve ever made</a>, by far,” as he claimed? Not quite. </p>
<p>In fact, U.S. gains in the United States-Canada-Mexico Agreement <a href="https://www.forbes.com/sites/johnbrinkley/2018/10/08/usmca-is-not-the-magnificent-trade-deal-trump-says-it-is/#4c363c1a4054">are modest</a> at best, even in the three areas most touted as wins.</p>
<p>While it’s true that U.S. dairy producers now have better access to the Canadian market, the <a href="https://www.cnbc.com/2018/10/24/fed-says-the-new-nafta-isnt-going-to-help-us-dairy-farmers.html">Federal Reserve Banks</a> of Minneapolis and Chicago predict little benefit. The increased market access is small. And U.S. dairy farmers are still facing tariffs from Mexico and Canada as retaliation for Trump’s metal tariffs.</p>
<p>Mexico’s promise of passing laws strengthening labor unions and worker rights also has little value for the U.S. Although these laws should reduce the extent to which Mexican workers are low-wage substitutes for U.S. workers, the new deal <a href="https://www.vox.com/2018/8/29/17791430/trump-mexico-trade-deal-nafta-labor">doesn’t spell out</a> enforcement. So, like the old NAFTA, these are unenforceable promises by Mexico.</p>
<p>Finally, the U.S. did manage to get its way on a rule requiring a zero-tariff car coming from Mexico to have at least 30 percent of the work done by employees earning at least US$16 an hour – three times the typical Mexican autoworker wage. <a href="https://www.reuters.com/article/trade-nafta-autos/trump-administration-says-trade-pact-will-bring-auto-jobs-back-to-us-idUSL2N1WH1V0">Some argue</a> this will create more high-wage auto jobs in the U.S. </p>
<p>Good news for American autoworkers right? Wrong. The penalty tariff for missing this mark is just 2.5 percent. Rather than shifting lots of labor back to the U.S., car companies will <a href="https://www.washingtonexaminer.com/policy/economy/usmca-deal-may-pressure-white-house-to-add-auto-tariffs-too">simply pay</a> the tariff. </p>
<h2>Squandering a good hand</h2>
<p>Now we turn to China, a trade relationship that’s far more complex.</p>
<p>Interestingly, the U.S. has even more leverage with China because most of its allies, such as the EU, <a href="https://www.brookings.edu/blog/order-from-chaos/2018/10/05/why-its-time-to-end-the-tit-for-tat-tariffs-in-the-u-s-china-trade-war/">agree with its concerns over intellectual property theft</a> and a lack of market access. They would have joined a coordinated effort to push China to change its ways. </p>
<p>But once again, rather than playing this already strong hand, Trump doubled down on go-it-alone confrontation by piling on the <a href="https://piie.com/blogs/trade-investment-policy-watch/trump-trade-war-china-date-guide">tariffs</a>, which now cover more than half of U.S. imports from China. </p>
<p>And he’s repeatedly threatened to go for broke and slap tariffs on <a href="https://www.cnbc.com/2018/07/20/cnbc-transcript-president-donald-trump-sits-down-with-cnbcs-joe-kern.html">all imports</a> from China. </p>
<p>What has this achieved? A tit for tat, full-blown trade war, in which each Trump salvo is greeted by retaliation. This retaliation has pummeled U.S. farmers: <a href="https://piie.com/blogs/trade-investment-policy-watch/first-tariffs-then-subsidies-soybeans-illustrate-trumps">Over 90 percent</a> of U.S. agricultural exports to China are now subject to tariffs. Although the Trump administration has <a href="https://www.wsj.com/articles/farmers-say-aid-wont-cover-tariff-damage-1537974178">promised billions</a> in tariff relief to farmers, many say it won’t be enough to offset the losses. </p>
<p>Putting aside China’s slapping of the U.S. with retaliation, possible concessions outlined by China don’t amount to much. They include offers of <a href="https://www.forbes.com/sites/charleswallace1/2018/04/06/china-offers-to-help-us-reduce-its-trade-deficit/#544cfeca3f08">helping reduce the bilateral trade deficit</a> – even though economists say they <a href="https://www.nytimes.com/2018/10/05/business/surprising-truths-about-trade-deficits.html">don’t matter</a> – and <a href="https://www.bloomberg.com/news/articles/2018-11-14/china-said-to-outline-concessions-to-u-s-ahead-of-g20-talks">other modest changes</a>. </p>
<p>Moreover, Trump <a href="https://www.cnbc.com/2018/04/18/trump-dismisses-tpp-but-may-have-missed-opportunity-in-china-trade-skirmish.html">already gave up</a> the ace in the hole that could have helped achieve so many of his goals: the <a href="https://theconversation.com/us/topics/tpp-7972">Trans-Pacific Partnership</a>. </p>
<p>Because the TPP would have been the largest trade deal ever and included so many of its Pacific neighbors, China would most likely have <a href="https://foreignpolicy.com/2015/10/07/china-tpp-trans-pacific-partnership-obama-us-trade-xi/">eventually joined</a>. That would have resulted in more market access for American companies in China and forced China to abide by rules essentially written by the U.S., the dominant economic superpower in the deal. </p>
<p>Alas, one of Trump’s first official acts as president was to <a href="https://www.washingtonpost.com/news/worldviews/wp/2018/04/13/a-timeline-of-trumps-complicated-relationship-with-the-tpp/">withdraw</a> from the TPP. </p>
<h2>How to play a winning hand</h2>
<p>Holding aces doesn’t ensure a win, of course. It’s more about making the right moves.</p>
<p>Trump’s best move now on China is to <a href="https://www.ft.com/content/ee361e2e-b283-11e8-8d14-6f049d06439c">focus on cooperating with the EU and Japan</a>. Uniting as a massive trading bloc is the best way to extract concessions from China. </p>
<p>And while early rumors of a possible <a href="https://www.nytimes.com/2018/11/27/us/politics/trump-xi-trade-g-20.html">truce</a> in the trade war are encouraging, the EU and Japan will only take part if they believe Trump is serious about cooperating with them and negotiating with China. That belief <a href="https://www.chathamhouse.org/expert/comment/us-allies-aren-t-buying-its-new-strategies-confront-china">has surely been dented</a> by Trump’s negotiating tactics. </p>
<p>The U.S. doesn’t have to keep threatening to burn down the house to get a good deal. The U.S. only has to play the cards it’s been dealt, which is typically a winning hand.</p><img src="https://counter.theconversation.com/content/104671/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>James Lake does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Boasting the world’s biggest and strongest economy, the U.S. has enormous leverage when it sits down with a partner to negotiate a trade deal. Threats and tariffs are not really helping.James Lake, Associate Professor of Economics, Southern Methodist UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1062442018-11-13T23:23:20Z2018-11-13T23:23:20ZThe urgent need for Canada to diversify its trade<figure><img src="https://images.theconversation.com/files/244113/original/file-20181106-74783-kpctkr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Cargo containers from Asia are seen in the port of Vancouver in 2015. Canada needs to diversify its trade beyond the United States and increase our links to rapidly growing emerging market economies, particularly in Asia.</span> <span class="attribution"><span class="source">(Shutterstock)</span></span></figcaption></figure><p>With the difficult renegotiation of the trade agreement with Canada’s largest trading partner <a href="https://www.cnn.com/2018/09/30/politics/trump-nafta-canada/index.html">now resolved</a>, it’s time for Canada to get serious about trade diversification.</p>
<p>The experience of renegotiating NAFTA — or USMCA as it is now called — has highlighted Canada’s vulnerability to one dominant trading partner that buys <a href="https://tradingeconomics.com/canada/exports">roughly 75 per cent of our exports</a>. </p>
<p>As a country, we should not be in this position. We need to diversify our trade beyond the United States and increase our links to rapidly growing emerging market economies, particularly in Asia, despite the “anti-China” clause in the USMCA. </p>
<p>Given that growth has pivoted to these emerging markets in the last 15 years, the first question is why has this not happened already. The answer is straightforward.</p>
<p>For a long time, being right beside the United States — the biggest, richest market in the world — has been a great ride for Canada. What’s more, we’re very comfortable and good at doing business with Americans.</p>
<h2>Fewer benefits of living next to U.S.</h2>
<p>So why diversify? The short answer is being right next door to the United States is not the ride it used to be. Part of this is the alarmingly protectionist sentiment of U.S. President Donald Trump’s administration, but the root of the answer pre-dates Trump.</p>
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Read more:
<a href="https://theconversation.com/trumps-protectionism-continues-long-history-of-us-rejection-of-free-trade-91190">Trump's protectionism continues long history of US rejection of free trade</a>
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<p>In the last 15 to 20 years, the United States has not been the engine of global growth that it was in the past. The U.S. share of global growth has been almost cut in half in the last two decades, falling from about 32 per cent in the 1990s to about 17 per cent in this decade. Over the same period, Asia’s share has risen from 32 per cent to just over 50 per cent, according to our analysis of World Bank trade data from the <a href="https://www.competeprosper.ca/">Institute for Competitiveness & Prosperity</a>. This has created a double challenge for Canada.</p>
<p>First, we are <a href="https://www.macleans.ca/economy/its-high-time-canada-looked-beyond-the-u-s-for-trade-opportunities/">significantly underexposed to emerging market economies</a>, so we are getting little upside from their acceleration in growth.</p>
<h2>Too engaged with sluggish economies</h2>
<p>In addition to the 75 per cent of our trade that goes to the U.S., another 10 per cent goes to other <a href="https://tradingeconomics.com/canada/exports">slow-growth advanced economies</a>, largely in Europe. Only about nine per cent of our trade is with faster-growing emerging economies like China, India, South Korea, Mexico and Brazil. </p>
<p>This is much lower than our peers. In Germany, the share of exports to emerging markets and other developing countries is in the 20s; for Japan and the U.S., it’s in the 30s; and in Australia, it’s in the 40s.</p>
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<img alt="" src="https://images.theconversation.com/files/244115/original/file-20181106-74760-h1l572.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/244115/original/file-20181106-74760-h1l572.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/244115/original/file-20181106-74760-h1l572.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/244115/original/file-20181106-74760-h1l572.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/244115/original/file-20181106-74760-h1l572.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/244115/original/file-20181106-74760-h1l572.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/244115/original/file-20181106-74760-h1l572.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Containers wait to be unloaded onto a container ship berthed at the Australian port of Melbourne. Australia does enormous trade with emerging markets, far more than Canada.</span>
<span class="attribution"><span class="source">(Shutterstock)</span></span>
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<p>Second, these rapidly growing economies are providing increasingly fierce competition for our products in the U.S. market. In 2000, <a href="https://wits.worldbank.org/CountryProfile/en/Country/USA/Year/2000/Summarytext">Canada was the leading source of American imports</a>. Today, China has the largest share of U.S. imports at <a href="https://tradingeconomics.com/united-states/imports-by-country">22 per cent</a>, up from only eight per cent in 2000. In the same period, Canada’s share has declined from just over 18 per cent to about 13 per cent. </p>
<p>We should have developed a diversification strategy a decade ago. But without a crisis, there has been little imperative. Call it lack of vision, risk-taking or leadership. </p>
<h2>Asian markets seen as risky</h2>
<p>Emerging markets and Asian markets, in particular, are often seen as distant and less familiar. They are seen as risky and more expensive to penetrate. The consequences have been stark.</p>
<p>In the last 15 years, Canada’s share of the world export market has slipped from about 4.5 per cent to about <a href="http://stat.wto.org/CountryProfile/WSDBCountryPFView.aspx?Country=CA">two per cent</a>. Part of this trend was inevitable as large emerging market economies joined the global trade and investment network, but Canada’s slide has been particularly precipitous. </p>
<p>Across the world’s Top 20 exporting countries, Canada’s performance since 2000 has been the second worst — only <a href="http://stat.wto.org/CountryProfile/WSDBCountryPFView.aspx?Language=S&Country=JP">Japan has seen a bigger decline</a> in its trade share than Canada. </p>
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<a href="https://theconversation.com/explainer-why-the-japanese-economy-is-stuck-in-a-holding-pattern-65806">Explainer: why the Japanese economy is stuck in a holding pattern</a>
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<p>Canada is losing share in the U.S. market that itself is losing share globally. We should instead be focused on gaining share in markets that are gaining share. This means diversifying our trade towards emerging market economies, particularly in Asia.</p>
<p>The place to start is with Asia’s two biggest economies, India and China. The new USMCA contains provisions that allow signatories to pull out of the deal if one country pursues a separate free-trade agreement with a “nonmarket country” — namely, China. But that should not be a barrier to this pivot. </p>
<p>India is a thriving democracy with strong ties to Canada. And as highlighted in a <a href="https://www.ppforum.ca/publications/diversification-not-dependence-a-made-in-canada-china-strategy/">recent report</a> on trade diversification from the Public Policy Forum, there is much that can be done with China short of a comprehensive free-trade agreement through sectoral agreements that offer “the best means for realizing quick and significant gains.”</p>
<p>Instead of waiting for a crisis, let’s make trade diversification the priority it should have been for at least the last decade.</p><img src="https://counter.theconversation.com/content/106244/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Tiff Macklem is the chair of the board of the Global Risk Institute, chair of Ontario's Panel on Economic Growth and Prosperity, a director of Scotiabank and a member of the Asian Business Leaders Advisory Board. In April 2018 he was named by the Government of Canada as Chair of the Expert Panel on Sustainable Finance.</span></em></p>Canada needs to diversify its trade beyond the United States and increase links to rapidly growing emerging market economies, particularly in Asia, despite the “anti-China” clause in the USMCA.Tiff Macklem, Dean and Professor of Finance, Rotman School of Management, University of TorontoLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1062222018-11-07T05:03:08Z2018-11-07T05:03:08Z2 economic policies likely to change with Democrats in control of House<figure><img src="https://images.theconversation.com/files/244261/original/file-20181107-74775-1vh86n7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">House Democrats will finally have a say in economic policy.
</span> <span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Congress-Immigration/18955895e01c4bfaaf73da141422e581/51/0">AP Photo/J. Scott Applewhite</a></span></figcaption></figure><p>Perhaps the biggest surprise in the midterm elections was that, unlike 2016, there wasn’t one. <a href="http://time.com/5412732/midterm-election-prediction-simulation/">Polls and pundits</a> expected Democrats would take control of the House and Republicans would keep the Senate, and that’s exactly what <a href="https://www.bloomberg.com/news/articles/2018-11-06/midterm-elections-2018-polls-closing-updates?srnd=premium">we’re getting</a>.</p>
<p>The likely result: two years of congressional gridlock on economic policy, which requires both houses of Congress to agree on the same legislation. So, we can expect that the status quo on economic policy will mostly prevail. </p>
<p>There are, however, two economic issues on which the election outcome will make a meaningful difference: trade and infrastructure. </p>
<h2>NAFTA lives</h2>
<p>One of the first items of business in January after the new Congress gets sworn in will be the <a href="https://www.vox.com/2018/10/3/17930092/usmca-nafta-trump-trade-deal-explained">United States-Mexico-Canada Trade Agreement</a>. </p>
<p>The deal is intended to replace NAFTA, which President Donald Trump <a href="https://thehill.com/policy/finance/370754-trump-keeps-nafta-withdr%5Bawal-in-the-mix">has threatened to withdraw from</a> for several years. In reality, the new deal is little more than a <a href="https://www.forbes.com/sites/johnbrinkley/2018/10/08/usmca-is-not-the-magnificent-trade-deal-trump-says-it-is/">slightly modified</a> version of its would-be predecessor. </p>
<p>But before it can become the law of the land, Congress must ratify it, either by a majority vote by both houses or two-thirds of the Senate. </p>
<p>The USMCA’s chances were already <a href="https://www.businessinsider.com/us-canada-mexico-trade-deal-usmca-nafta-congress-vote-block-2018-10">far from assured</a> before the Democrats took the House. Now its failure is very likely. </p>
<p>So what happens next? </p>
<p>The simple answer is not much. NAFTA remains in force. Ultimately I believe that’s a good thing for the U.S. economy because the new deal <a href="https://piie.com/blogs/trade-investment-policy-watch/mexico-canada-and-united-states-step-backwards-trade-and">would likely shift</a> auto industry jobs to Mexico. </p>
<p>With any luck, the USMCA defeat also convinces Trump to have second thoughts about his <a href="http://time.com/money/5399691/trump-trade-war-china-products/">costly</a> <a href="https://www.nytimes.com/2018/11/05/business/soybeans-farmers-trade-war.html">trade war</a>. </p>
<p>But what if he tries to follow through on his threat to withdraw from NAFTA? Fortunately, <a href="https://www.vox.com/policy-and-politics/2017/10/26/16505508/nafta-congress-block-trump-withdraw-trade-power">most constitutional</a> <a href="https://theconversation.com/trumps-threat-to-withdraw-from-nafta-may-hit-a-hurdle-the-us-constitution-81444">scholars</a> say he can’t do so unilaterally. Were he able to, however, the consequences for the U.S. economy <a href="https://www.nytimes.com/2017/10/12/business/economy/what-would-happen-if-the-us-withdrew-from-nafta.html">would be severe</a>. </p>
<h2>Roads, bridges and bipartisanship</h2>
<p>Infrastructure, on the other hand, offers a rare opportunity for House Democrats and Trump to find common ground. </p>
<p>The <a href="https://www.infrastructurereportcard.org/">signs of a crisis</a> in America’s infrastructure are unmistakable: derailing and delayed trains, crumbling roadways, collapsing bridges, undrinkable tap water and a wastewater system that is a menace to public health. </p>
<p>The American Society of Civilian Engineers estimated that America’s “D+” infrastructure costs an average household US$3,400 annually. It also cost lives, as it did when a Minnesota bridge <a href="https://www.npr.org/2017/08/01/540669701/10-years-after-bridge-collapse-america-is-still-crumbling">collapsed</a> in 2007, killing 13.</p>
<p>In February, Trump <a href="https://www.vox.com/policy-and-politics/2018/2/12/17003840/trumps-infrastructure-plan">proposed a fund</a> to spend $1.5 trillion to fix the infrastructure mess, with the government putting up $200 billion and the private sector kicking in the rest. </p>
<p>While Democrats <a href="https://www.washingtonpost.com/powerpost/democrats-to-unveil-1-trillion-infrastructure-plan-seek-reversal-of-gop-tax-cuts-to-finance-it/2018/03/07/0de718f6-21c8-11e8-94da-ebf9d112159c_story.html?utm_term=.497cae951c26">support</a> infrastructure spending, the <a href="https://www.ttnews.com/articles/senate-democrats-again-criticize-trumps-infrastructure-proposal">stumbling block</a> in the Trump plan was the provision that the private sector would effectively own the roads and bridges that it builds. </p>
<p>While House Democrats may not support this plan, they would likely be willing to support something that mainly relies on just federal spending. And Republicans have a reason to go along as well: Infrastructure spending <a href="https://fas.org/sgp/crs/misc/R44896.pdf">would boost</a> economic growth, which is <a href="https://www.cbo.gov/publication/54318">forecast</a> to slow in 2019 – just before the 2020 elections.</p>
<p>While a few hundred billion dollars in spending won’t solve the U.S. infrastructure problem, it would be a good start. It would stimulate the economy and also make everyone’s lives more pleasant and less expensive – and may even end a little gridlock (pun intended).</p><img src="https://counter.theconversation.com/content/106222/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Steven Pressman does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>While a divided Congress will likely mean gridlock, there are two economic policies likely to see significant change: trade and infrastructure.Steven Pressman, Professor of Economics, Colorado State UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1057742018-10-30T21:57:03Z2018-10-30T21:57:03ZIn defence of Canada’s dairy farmers<figure><img src="https://images.theconversation.com/files/242525/original/file-20181026-7074-qw35ic.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Canada's dairy industry is being increasingly put at risk in trade negotiations. A visit to a Canadian dairy farm illuminates why the industry should be protected. </span> <span class="attribution"><span class="source">(Shutterstock)</span></span></figcaption></figure><p>At 8 a.m. one recent morning, when the milking of 110 cows was complete, I helped Jeannie van Dyk feed her calves and give them clean bedding. Van Dyk has not lost any calves due to excellent biosecurity and their housing and feeding regimes.</p>
<p>All the calves at Lellavan Farms in Noel Shore, N.S., are fed warm water, which helps them avoid getting chilled. The calf hutches are modular, allowing them to be taken down for cleaning. The space is being moved to a positive air-pressure system to ensure protection from disease. </p>
<p>The calves are fed milk twice daily, individually according to size, appetite and age. Then they’re taught to drink from a bucket and they start solid food at around three weeks.</p>
<p>At 8:20, the milk tanker arrived, collecting 8,000 litres that would soon reach homes across the province. The conversation at the farm shifted from cows to macro forces shaping the Lellavan Farm family’s world: Supply management and international trade deals.</p>
<h2>At the centre of trade talks</h2>
<p>Our dairy industry has been in the news a lot in recent years as a focal point in Canada’s many international trade negotiations.</p>
<p>First, there was the <a href="http://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/ceta-aecg/index.aspx?lang=eng">Comprehensive Economic and Trade Agreement</a> between Canada and the European Union, known as CETA. Then came the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, <a href="https://international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/cptpp-ptpgp/index.aspx?lang=eng">dubbed the TPP</a>. Most recently there was the sticky renegotiation of NAFTA, resulting in the new United States-Mexico-Canada Agreement, <a href="https://international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/usmca-aeumc/index.aspx?lang=eng">or the USMCA.</a> </p>
<p>Every farmer in Canada rides the waves of these negotiations. Concessions and deals are cut in faraway urban environments, sometimes with little input from the rural communities that depend on agriculture for cultural and physical survival.</p>
<h2>Day kicks off in darkness</h2>
<p>I’ve worked with the agricultural industry for more than 20 years, in at least four different countries. But until this past Thanksgiving weekend at Lellavan Farms, I didn’t really know what it was to be a dairy farmer, to stomp a mile in their muddy boots, kicking my day off in the darkness at 4:30 a.m.</p>
<p>As we worked our way through the various chores, I chatted with Jeannie about her job, her farm and what these trade agreements mean to her. The three aforementioned agreements have collectively given other countries access to more than nine per cent of the Canadian milk market.</p>
<p>That is more milk than is produced in all of Atlantic Canada. Van Dyk shared with me a <a href="https://www.agropur.com/sites/default/files/documents/Analysis_of_%20impacts_of_supply_management_Canadian_dairy_inudstry-EN.pdf">report commissioned by Agropur Dairy co-operative</a>, whose members are spread across five Canadian provinces, called <em>Analysis of the potential impacts of the end of supply management in the Canadian dairy industry.</em> </p>
<p>It says opening up the Canadian dairy system risks a net loss of $2.1 to $3.5 billion of Canada’s GDP. Approximately 24,000 direct jobs would be affected.</p>
<h2>A spike followed by a decline</h2>
<p>Other studies suggest that countries that have transitioned away from supply management, such as Australia, have seen an initial spike in dairy production, <a href="http://www.momagri.org/UK/focus-on-issues/A-glimpse-of-the-world-abolition-of-supply-management-in-Australia_1667.html">then a steady reduction in production,</a> farms and farmers. Many producers have been <a href="http://www.agrifoodecon.ca/uploads/userfiles/files/dairy%20policy%20reform-cautionary%20july-18.pdf">forced to exit the industry</a> due to soft market conditions.</p>
<p>Van Dyk tells me that she writes 50 business cheques each month to local companies, a substantial contribution to the local economy. Her farm employs people from the community and hosts a student each summer, so future farmers have applied knowledge.</p>
<p>Being a dairy farmer is more than a job. It’s a way of life. The recent concessions in trade agreements are eroding farmers’ livelihoods, and thus that way of life.</p>
<p>Granted, it’s a challenging life. I often ask farmers why they do it.</p>
<h2>Love of their animals</h2>
<p>The answer is always the same: Love. Canadian dairy farms are not just milk factories. They are collections of people who love what they do and the animals in their care. That gets them through 20-hour days in the summer.</p>
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<img alt="" src="https://images.theconversation.com/files/242528/original/file-20181026-7071-pjvba9.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/242528/original/file-20181026-7071-pjvba9.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=459&fit=crop&dpr=1 600w, https://images.theconversation.com/files/242528/original/file-20181026-7071-pjvba9.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=459&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/242528/original/file-20181026-7071-pjvba9.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=459&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/242528/original/file-20181026-7071-pjvba9.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=577&fit=crop&dpr=1 754w, https://images.theconversation.com/files/242528/original/file-20181026-7071-pjvba9.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=577&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/242528/original/file-20181026-7071-pjvba9.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=577&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Canada’s dairy farmers care about their livestock. In this 2016 photo, Andy Benson poses with a calf he saved a month earlier by performing CPR on his dairy farm in Bellisle Creek, N.B.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Ron Ward</span></span>
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<p>Jeannie and her husband John are proudly mentoring their two sons into the management of the 600-acre crop and 300-head farm. They all showed me how incredibly innovative farmers are as well as their dedication to the welfare and comfort of their animals. </p>
<p>Lellavan Farms just installed a $2.2-million dairy barn designed around the principal criteria of animal welfare, comfort and safety. Jeannie knows every single animal. As we walked around and interacted with them, it was clear they knew her. They showed affection.</p>
<p>In the language of reports, the Agropur report states that the dairy industry “contributes to the regional fabric and territory occupations.”</p>
<p>I’ll put it this way: You cannot separate farming from the fabric of rural Canada. The families, animals and land are fully integrated into the community and landscape. The survival of rural Atlantic Canada, in particular, is dependent on this, and it is something we must keep in mind during all of our trade negotiations.</p>
<p>Agriculture is our future; it’s that simple.</p><img src="https://counter.theconversation.com/content/105774/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>David Gray does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Countries that have phased out supply management systems in the dairy industry have seen an initial spike in production, then a steady decline. That’s why Canada should protect its dairy farmers.David Gray, Dean of the Faculty of Agriculture, Dalhousie UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1048182018-10-28T14:09:54Z2018-10-28T14:09:54ZMake no mistake: The USMCA is an America-first trade deal<figure><img src="https://images.theconversation.com/files/241762/original/file-20181023-169831-174be91.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">U.S. President Donald Trump announces a revamped North American free trade deal in the Rose Garden of the White House in Washington on Oct. 1, 2018. </span> <span class="attribution"><span class="source">(AP Photo/Pablo Martinez Monsivais)</span></span></figcaption></figure><p>The emerging conventional wisdom around the United States-Mexico-Canada Agreement (USMCA) seems to be that it’s a mediocre deal for Canada, driven by an American president <a href="http://www.msnbc.com/rachel-maddow-show/trump-changes-naftas-name-not-much-else">who mostly cares about the agreement’s name</a>. </p>
<p>However, the emerging wisdom goes, the deal <a href="https://www.theglobeandmail.com/business/commentary/article-why-usmcas-china-clause-is-okay-for-canada/">“essentially represents the status quo with a few wrinkles”</a> and could have been much worse: It’s <a href="https://www.theglobeandmail.com/opinion/editorials/article-globe-editorial-did-canada-give-up-on-china-in-exchange-for-the-usmca/">“a good deal for this country, especially given the circumstances.”</a> </p>
<p>The underlying assumption is that “the circumstances” are U.S. President Donald Trump, and that things will get back to normal once he finally departs.</p>
<h2>American, not Trumpian, interests</h2>
<p>This perspective dramatically misreads our current situation. The famously ignorant Trump may not understand trade policy, but in all the ways that matter, this deal was driven by <em>American</em> interests, reflecting many longstanding bipartisan U.S. objectives related to the knowledge economy. </p>
<p>Far from maintaining the status quo, the USMCA, if ratified, would fundamentally alter North America’s political and economic structures, increasing American dominance over its neighbours.</p>
<p>To understand why the USMCA is more than just a name change, consider the political and economic reasons why Canada negotiated for free trade in the first place.</p>
<p>First, the politics. </p>
<h2>Guaranteed access weakened</h2>
<p>Canada negotiated the original 1988 free-trade agreement to insulate our access to the U.S. market from domestic American interference. By opening the agreement to a mandatory review after six years, the USMCA weakens this guaranteed access. </p>
<p>Those who think that the six-year delay is a safety valve because the review would take place in the post-Trump era should reconsider. As I detail in my book, <a href="https://utorontopress.com/ca/copyfight-4"><em>Copyfight</em></a>, the presence of a trade agreement actually increased Canadian copyright-policy autonomy. Given this opening, American businesses and American governments of any political stripe would be crazy not to use it to pursue further changes in their own interests.</p>
<p>The other important aspect of free-trade agreements is their limited nature: They’re only supposed to be about tariff and non-tariff issues among the signatory countries. </p>
<p>When they deal with non-trade issues, such as labour and the environment, they tend to do so in a limited manner. That’s because countries usually want to preserve their ability to set domestic and foreign economic policy without outside interference. </p>
<p>During the NAFTA era, the three countries were ever conscious of their sovereignty as they attempted to manage the complexities of economic integration. </p>
<h2>Sovereignty at risk</h2>
<p>In contrast, and unlike normal agreements, the USMCA would interfere in the countries’ sovereign monetary and treaty-making powers. Chapter 33 <a href="https://qz.com/1408402/nafta-the-most-important-clause-in-trumps-new-usmca-deal-aims-at-china/">addresses domestic monetary policy</a> in ways that may not limit our action now but could in the future: Economic policies do fall in and out of fashion, after all.</p>
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<a href="https://images.theconversation.com/files/241764/original/file-20181023-169813-sp4p4s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/241764/original/file-20181023-169813-sp4p4s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/241764/original/file-20181023-169813-sp4p4s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=744&fit=crop&dpr=1 600w, https://images.theconversation.com/files/241764/original/file-20181023-169813-sp4p4s.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=744&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/241764/original/file-20181023-169813-sp4p4s.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=744&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/241764/original/file-20181023-169813-sp4p4s.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=935&fit=crop&dpr=1 754w, https://images.theconversation.com/files/241764/original/file-20181023-169813-sp4p4s.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=935&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/241764/original/file-20181023-169813-sp4p4s.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=935&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Prime Minister Justin Trudeau is seen on a visit to Guangzhou, China, in December 2017.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Sean Kilpatrick</span></span>
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<p>Article 32.10, meanwhile, would make it extremely difficult for any of the three countries to sign a trade agreement with a “non-market” country (translation: China). This includes the right to review the treaty prior to its signature.</p>
<p>Maybe, <a href="https://theconversation.com/how-the-new-usmca-strengthens-canada-in-future-trade-deals-104814">as the University of Toronto’s Andrew McDougall suggests elsewhere on this site,</a> this article is just meaningless American posturing. And a Canada-China trade agreement may or <a href="https://www.theglobeandmail.com/opinion/article-ottawas-pursuit-of-free-trade-with-china-is-a-losing-proposition/">may not be a good idea</a>. </p>
<p>But there’s no question Article 32.10 commits Canada to much more than is typical of a free-trade agreement, reinforcing an emerging with-us-or-against-us regionalism. Article 32.10 could end up being the first articulation of a <a href="https://www.britannica.com/event/Monroe-Doctrine">21st-century Monroe Doctrine.</a></p>
<h2>A new, and injurious, economic model</h2>
<p>If USMCA’s politics are problematic, its economics are worse. Trade agreements aren’t just about market access: They implement specific economic-development philosophies. </p>
<p>Embracing the theory of comparative advantage, Brian Mulroney’s Progressive Conservative government won the 1988 election on the argument that free trade (low trade barriers between countries) rather than protectionism would deliver economic prosperity.</p>
<p>Here’s where the USMCA’s biggest problem emerges. Proponents who claim that the USMCA only incrementally changes NAFTA completely miss the fact that its intellectual property and e-commerce provisions lock Canada into a fundamentally new, and likely injurious, economic development model.</p>
<p>Missing in this non-debate is the realization that we are moving from an economy based on comparative advantage, in which prosperity comes from reducing trade barriers, to one based on innovation, in which economic success depends on the control of data and intellectual property.</p>
<p>Data and intellectual property rights are not just a single-sector issue like, say, dairy —they are becoming embedded in pretty much every economic sector. </p>
<h2>Digital economy comprises all sectors</h2>
<p>Their regulation isn’t a “digital economy” issue. As machine learning permeates the entire economy, “digital economic development” and “economic development” will become increasingly synonymous.</p>
<p>The USMCA’s data and <a href="https://ottawacitizen.com/news/economy/canada-caved-on-intellectual-property-issues-critics-of-trade-deal/wcm/cb9f4725-7f6e-40f3-a6bf-b2b4a38aa6c0">intellectual property</a> provisions, the genesis of which predates Trump, <a href="https://www.washingtonpost.com/news/global-opinions/wp/2018/10/03/how-the-usmca-falls-short-on-digital-trade-data-protection-and-privacy/">were largely copied from the Trans-Pacific Partnership</a>, where they were key U.S. demands.</p>
<p>They are part of a long-term strategy to preserve U.S. global dominance in this vital area. These provisions — especially stronger IP protection and broad data-localization prohibitions — are designed to benefit disproportionately dominant knowledge-based companies and countries (especially the United States). They are not in Canada’s interest.</p>
<p>As <a href="https://www.macleans.ca/opinion/the-usmca-locks-canada-in-on-digital-trade-and-at-a-worrying-time/">University of Ottawa law professor Teresa Scassa argues</a>, tying Canada to the USMCA will inhibit our participation in the knowledge economy, even as it expands to include more and more of the entire economy.</p>
<p>The USMCA is not a status quo agreement that can be reset once Trump is gone. It is the new normal. It reflects a new economic logic. The sooner we start debating realistically the consequences of this new model for Canada’s future development, the better.</p><img src="https://counter.theconversation.com/content/104818/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Blayne Haggart receives funding from the Social Sciences and Humanities Research Council of Canada. He is also currently a research fellow with the Centre for Global Cooperation Research at the University of Duisburg-Essen, Germany. </span></em></p>The USMCA, if ratified, will fundamentally alter North America’s political and economic structures, increasing American dominance over its neighbours.Blayne Haggart, Associate Professor of Political Science, Brock UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1048142018-10-21T13:02:53Z2018-10-21T13:02:53ZHow the new USMCA strengthens Canada in future trade deals<figure><img src="https://images.theconversation.com/files/241349/original/file-20181018-67161-103q0oz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Prime Minister Justin Trudeau and Minister of Foreign Affairs Chrystia Freeland hold a news conference on the United States Mexico Canada Agreement (USMCA) in Ottawa on Oct. 1, 2018. THE CANADIAN PRESS/Justin Tang</span> <span class="attribution"><span class="source">THE CANADIAN PRESS/Justin Tang</span></span></figcaption></figure><p>Now that the threat of the <a href="https://www.macleans.ca/news/canada/how-nafta-was-saved-the-bitter-fight-and-last-minute-recovery/">NAFTA-pocalypse has lifted for Canada</a>, the Monday morning quarter-backing is well under way on whether the new United States-Mexico-Canada (USMCA) Agreement is better or worse than trade pact that preceded it. </p>
<p>But beyond the negative headlines, the USMCA probably leaves Canada stronger than it was going into the negotiations when it comes to future trade negotiations.</p>
<p>Three components of the deal, however — those surrounding dairy, the <a href="https://www.theglobeandmail.com/opinion/article-the-china-clause-in-usmca-is-american-posturing-but-its-no-veto/">non-market economy clause</a> and the new sunset provision — are worth reviewing for how they change Canadian trade politics both domestically and globally.</p>
<h2>Dairy</h2>
<p>Canadian dairy farmers have long been largely untouchable politically. That may now be changing, and they should expect to have their market access further eroded in future trade agreements.</p>
<p>In the short run, U.S. President Donald Trump was probably the best thing that ever happened to them. His disdain for Canadian dairy caused Canada to close ranks to support supply management even though it was already under intense scrutiny domestically as well. </p>
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<p>
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<strong>
Read more:
<a href="https://theconversation.com/in-trade-war-with-trump-canada-should-stop-defending-the-indefensible-on-dairy-products-98127">In trade war with Trump, Canada should stop defending the indefensible on dairy products</a>
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<p>A important turning point came with a seminal <a href="https://www.policyschool.ca/wp-content/uploads/2016/03/supply-management-hall-findlay.pdf">2012 research paper</a>. In the report, author Martha Hall Findlay argued that the 1970s version of supply management was outdated, unjustified, was enriching dairy farmers on the backs of middle-class and low-income consumers and interfering with our trade agenda.</p>
<p>When Trump demanded dairy concessions, it not only solidified but calcified support among politicians for a system in Canada that was otherwise losing ground. Nonetheless he probably only delayed the inevitable.</p>
<figure class="align-right ">
<img alt="" src="https://images.theconversation.com/files/241059/original/file-20181017-41147-1txohfl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/241059/original/file-20181017-41147-1txohfl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=408&fit=crop&dpr=1 600w, https://images.theconversation.com/files/241059/original/file-20181017-41147-1txohfl.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=408&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/241059/original/file-20181017-41147-1txohfl.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=408&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/241059/original/file-20181017-41147-1txohfl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=513&fit=crop&dpr=1 754w, https://images.theconversation.com/files/241059/original/file-20181017-41147-1txohfl.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=513&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/241059/original/file-20181017-41147-1txohfl.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=513&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Cows check out visitors on a dairy farm in Saint-Henri-de-Taillon, Québec, in September 2018.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Jacques Boissinot</span></span>
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<p>The number of dairy farmers actually in the system is down about 90 per cent since supply management’s start in the early 1970s <a href="https://www.theglobeandmail.com/news/politics/canadas-dairy-industry-is-a-rich-closed-club/article25124114/">to around 11,500 from about 140,000 in the late 1960s and early 1970s,</a> and they have been a key irritant in nearly all of the country’s trade negotiations. </p>
<p>The political power of Canada’s dairy farmers rests on a crumbling consensus about the value of supply management. <a href="http://policyoptions.irpp.org/magazines/june-2018/public-ahead-of-politicians-on-dismantling-supply-management/">The Institute for Research on Public Policy recently found many Canadians supported </a> dismantling the system.</p>
<p>Nearly every other country has phased out similar supply management systems. With Canadian concessions in the Trans Pacific Partnership (TPP) with the Pacific rim, the Comprehensive Economic Trade Agreement with the European Union (CETA) and now the USMCA, it seems likely that supply management is something that will be increasingly bargained away.</p>
<p>Despite the promise of compensation from Ottawa, the industry needs to prepare now for long-term liberalization.</p>
<h2>Section 32.10</h2>
<p>Probably no section of the new agreement has raised as many eyebrows as Section 32. It compels each of the three parties to notify the others three months before they start trade negotiations with a country defined as having a “non-market” economy — namely, China. </p>
<p>A trade pact’s text must be disclosed within 30 days of signing it for review by the other two USMCA partners. If the other two countries don’t like it, they can kick that country out of the USMCA.</p>
<p>The provisions have been erroneously reported as giving the United States a veto over Canadian trade policy. It doesn’t (but don’t take my word for it, <a href="https://ustr.gov/sites/default/files/files/agreements/FTA/USMCA/32%20Exceptions%20and%20General%20Provisions.pdf">go ahead and read it</a>). </p>
<p>Further, given that under <a href="https://ustr.gov/sites/default/files/files/agreements/FTA/USMCA/34%20Final%20Provisions.pdf">Section 34.6</a>, the USMCA allows for withdrawal on six months’ notice from any country for any reason at all, the clause is more political than legal. Even without the China clause, if the U.S. doesn’t like Canadian trade policy, it can just leave the USMCA under 34.6. </p>
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<img alt="" src="https://images.theconversation.com/files/241058/original/file-20181017-41135-1ssyvdw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/241058/original/file-20181017-41135-1ssyvdw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/241058/original/file-20181017-41135-1ssyvdw.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/241058/original/file-20181017-41135-1ssyvdw.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/241058/original/file-20181017-41135-1ssyvdw.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/241058/original/file-20181017-41135-1ssyvdw.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/241058/original/file-20181017-41135-1ssyvdw.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">In this November 2017 photo, President Donald Trump and Chinese President Xi Jinping shake hands during a joint statement to members of the media Great Hall of the People in Beijing, China.</span>
<span class="attribution"><span class="source">(AP Photo/Andrew Harnik)</span></span>
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<p>So who wins with this largely symbolic provision? Trump, for domestic reasons. The president can present this to his protectionist base as part of his wider trade war on China. This gives him a win as both the mid-term elections and 2020 loom.</p>
<p>But longer term, Section 32 may actually serve Mexico’s and Canada’s interests more than America’s. It symbolically ties the U.S. tightly to the USMCA by linking its global anti-China ambitions to the trade agreement. That’s not a bad thing for Canada from a trade perspective.</p>
<p>Why?</p>
<h2>‘Political cudgel’</h2>
<p>Presenting the USMCA to the world as a common front against China — the American intent with Section 32 — means abandoning the trade agreement is now more difficult for the United States. Any future threat to kill the agreement from Washington (and it won’t come from anywhere else) can now be framed by supporters of the USMCA as being weak on China.</p>
<p>That will likely reduce any chance it will be scrapped, which benefits Mexico and Canada.</p>
<p>The agreement comes up for its first mandatory review in six years to decide whether it should be extended. At that time, Section 32 provides a political cudgel to Ottawa and Mexico City to remind the United States that the USMCA helps to cement their global leadership against countries it views as strategic competitors. </p>
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<img alt="" src="https://images.theconversation.com/files/241065/original/file-20181017-41150-u31grb.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/241065/original/file-20181017-41150-u31grb.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=429&fit=crop&dpr=1 600w, https://images.theconversation.com/files/241065/original/file-20181017-41150-u31grb.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=429&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/241065/original/file-20181017-41150-u31grb.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=429&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/241065/original/file-20181017-41150-u31grb.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=539&fit=crop&dpr=1 754w, https://images.theconversation.com/files/241065/original/file-20181017-41150-u31grb.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=539&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/241065/original/file-20181017-41150-u31grb.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=539&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Prime Minister Justin Trudeau and Minister of Foreign Affairs Chrystia Freeland are seen on Parliament Hill following a news conference on the USMCA trade deal on Oct. 1, 2018.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Justin Tang</span></span>
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<p>There was no similar provision in NAFTA, but if there was, there’s no doubt it would have helped us at the bargaining table.</p>
<p>Does this risk our relationship with China? Not likely. Remember, we’re nowhere near a trade agreement with China anyway given very different perspectives on environment and labour standards. </p>
<p>But that doesn’t mean there <a href="https://www.ppforum.ca/wp-content/uploads/2018/10/DiversificationNotDependence-PPF-OCT2018-EN-6.pdf">aren’t options</a>, and Canada has every right to pursue an agreement if we want. Mexico has already told China that <a href="https://www.scmp.com/news/china/diplomacy/article/2168493/mexico-seeks-assure-china-new-us-trade-deal-wont-block-other">it doesn’t see the USMCA as hindering any future agreements</a>. Canada can and should do the same.</p>
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<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/beyond-nafta-canada-must-find-new-global-markets-98430">Beyond NAFTA: Canada must find new global markets</a>
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<p>Canada can also use the USMCA to its advantage with China — a country many times its size. While NAFTA was in doubt, Canada was in a weaker position negotiating with China.</p>
<p>Now, by fully securing continental trade, Canada can leverage its more secure position at the bargaining table to more credibly insist on a deal that works for North America.</p>
<h2>Sunset clause</h2>
<p>The U.S. <a href="https://www.theguardian.com/us-news/2018/aug/25/nafta-trump-drops-sunset-clause-demand-mexico?CMP=twt_gu">walked back its insistence on a five-year sunset clause</a> on NAFTA. <a href="https://ustr.gov/sites/default/files/files/agreements/FTA/USMCA/34%20Final%20Provisions.pdf">Now, the USMCA technically expires </a> every 16 years, unless all parties commit to renewing it after the first six years. </p>
<p>Failure to do so will lead to an automatic expiry after 10 years, but with meetings held annually to work out the differences. The parties meet every six years otherwise to review the agreement.</p>
<p>Again, there is less here than meets the eye. The agreement can theoretically be terminated on six months’ notice anyway. But this process has some potential upsides for keeping the deal up to date.</p>
<h2>Overhaul was long overdue</h2>
<p>Drama aside, there was nothing wrong with updating NAFTA. It was time; the agreement was 24 years old and included nothing on topics like the digital economy. Yet there was scant motivation by its three members to overhaul it.</p>
<p>We shouldn’t wait for a crisis to break out every quarter century to review our most important trade agreement. The technical expiry dates of the USMCA can and should be used to make regular changes that will keep the agreement fresh and remind all three countries of its importance to their economies. </p>
<p>That means we may end up with a better, more flexible USMCA.</p>
<p>To summarize, the USMCA, while imperfect, is overall a positive development for Canada. It has a number of structural elements that may very well leave us stronger when negotiating trade pacts in the future.</p><img src="https://counter.theconversation.com/content/104814/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Andrew McDougall does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The USMCA, while imperfect, is overall a positive development for Canada. It has a number of structural elements that may very well leave us stronger when negotiating trade pacts in the future.Andrew McDougall, Sessional Lecturer, University of TorontoLicensed as Creative Commons – attribution, no derivatives.