NAFTA’s near death paved the way for Biden’s first bilateral meeting

02.23.21
Article

We will return to a comforting, almost nostalgic normalcy Tuesday, when President Joe Biden initiates his first official meeting with a foreign leader, and that leader is Prime Minister Justin Trudeau.

Since the earliest years of the last century, when Teddy Roosevelt became the first president to travel abroad, Canada has been the most-favoured inaugural destination. Mexico is the other. Geography and economic interdependence are powerful commonalities.

President Trump, looking for a warm welcome, chose Saudi Arabia for his first official trip in 2017. When he did get around to visiting Canada more than two years into his administration, attending a G7 meeting in Quebec, the former president left early, tweeting on his way out the door about Trudeau’s “dishonesty and weakness.” (Trudeau had angered Trump by promising to countervail the administration’s tariffs on Canadian steel and aluminium, which Trump had characterized as a threat to U.S. national security).

So, to quote Trudeau himself, this week’s meeting feels like a dam breaking. The insults and threats of the past four years are aberrant and best forgotten. Foreign policy is once again anchored in reality. Diplomacy is diplomatic again.

It helps, of course, that the two leaders share a progressive worldview, and have a bit of history, Trudeau having hosted Biden when Biden was vice-president, during the final days of the Obama administration. At their virtual meeting this week, they intend to focus on COVID, the economy and climate change.

It has to be said, though: Trump’s behaviour was in some ways helpful. In his chaotic way, he ensured that his successor’s dealings with Canada would be easier, and the state of the U.S.-Canada relationship more solid.

The fact is, Trump was onto something when he declared early in his term that NAFTA needed renegotiation. The aging trade treaty was outdated, and unsuited to the modern economy, but systemic inertia had kept it in stasis since 1994.  

Then Trump threatened to tear it up. And everyone took him seriously. Such was his reputation for disruption. Americans and Canadians believed he was capable of actually walking away from the treaty that legally stitched together North America’s three national economies, with all the disastrous implications cancellation would carry.

In reaction, something meaningful happened: at a time of political division so deep that Americans could barely agree on the time of day, Trump’s threat unified. Canada and Mexico mobilized negotiation teams. In the U.S., farmers and ranchers and manufacturers and retailers, small and big businesses, old-economy and high tech firms – just about everyone involved in the trillion-dollar-plus worth of trade among the three countries – got on the phone to their member of Congress. And Congress, which had by then earned the sobriquet “legislative graveyard,” understood that trade law is not a partisan matter.

The negotiators struck an agreement. And in a matter of weeks, the new NAFTA – now known by different names in all three countries – passed both houses of Congress with big majorities. Without question, had Donald Trump not threatened to burn down the treaty, we would still be meandering along under the old rules.

The whole episode left the Canada-U.S. relationship at the front of America’s political mind. Late last year, when the Canadian American Business Council held our 26th annual State of the Relationship event, we sent invitations to members of Congress soliciting video messages. The response, from lawmakers on both sides of the aisle, nearly defied our editing capacity. It was an encouraging glimmer.  Our bilateral relationship abides, regardless of politics, and our politicians were acknowledging that.The question before us now, to extend the metaphor, is how to magnify the glimmer into a torch.

Goodwill is wonderful, but the urgency of our shared near-death experience over NAFTA is gone, and we still have a platter of sticky old issues to deal with: the U.S. buy-America policy, softwood lumber, energy infrastructure, and regulatory incohesion, to name four.

And it would be unwise for Canada to conclude that just because we now have leaders who share a certain vision and bonhomie, bilateral matters will tend to themselves. Congress is vitally important. House Democrats cannot be taken for granted, and the Senate is symmetrically divided. How often will the Biden administration care to expend the political capital of Vice-president Kamala Harris’s tie-breaking Senate vote?

The answer is that our governments must identify areas of common ground and triple down. Issues that stimulate economic recovery have the best chance of success. Motor vehicle emissions standards, collaboration on infrastructure, and an area with immense potential: processing of critical minerals and rare earths.

Rare earth minerals are essential in cell phones, computers, green technologies, jet aircraft, precision guided missiles and wind turbines, among other things. Canada not only has vast reserves of rare earths, it also has the engineering talent, the resources experience, the railroads, ports and hydroelectric power to become the world leader in refining and processing the materials. 

Instead, China utterly dominates global extraction and processing. Usurping Chinese hegemony would be in both our vital national interests. Canada and the U.S. are working together on a bilateral approach to critical minerals, but progress has been glacial. If only we could apply some of that Trump-era urgency to the issue.

So here’s to normalcy. Hurrah. But there’s so much work to be done. And whatever we do, let us ensure we do it together.

Maryscott Greenwood is the CEO of the Canadian American Business Council

Photo Credit: Evan Vucci/The Associated Press

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