Bullet Dodged

Apparently, there are still some adults left in Ottawa and they realized that Trump and his trade negotiators really were not bluffing. Soooo. NAFTA 2.0.

Frankly, I think we won by not actually losing. JT realized that the automotive trade was worth more than gender equality in trade terms. We keep trading with the US, they ship more dairy tariff-free, we get to buy up to $100 bucks an order online from Amazon without duty, keep a dispute mechanism, cultural industries (which apparently include banking, who knew?) exempted…But the big bonus is that we never again have to see Chrystia Freeland in a far too tight dress again. Thank you, President Trump.

Now, this sort of blows Justine’s prospects of running against the Tyrant Trump in a year. I mean, the Liberals will be there in spirit, but it will be impossible to spin this agreement as both a win for Canada and standing up to the big, orange, American bully.

Sensible people do what they need to do to get a deal they need. Encouragingly, there are still a few sensible people in Ottawa.

Update: Only a flesh wound,

“However, the USMCA includes language that requires signatories to give notice if they plan to negotiate a free trade deal with a “non-market country,” and to allow the other two signatories at least a month to review any agreement before it is signed. It explicitly states that if one of the signatories enters into such an agreement, the other two have the right to withdraw from the USMCA with six months’ notice.” national post

My charming elder son texted to suggest that I was full of it and that this deal was essentially NAFTA 2. No major changes.

Well, this language is a major change and a direct restriction on our sovereignty. I don’t think it is a particularly bad restriction but it does mean that the USMCA is more a trade bloc than a free trading area.

Sundance, over at The Conservative Treehouse sees this as a way of stopping the quaint Mexican and Canadian practice of allowing foreign companies to ship parts to those countries and then put the parts together and claim that the finished product is “Made in Canada/Mexico”.

I don’t think that is correct as it only deals with “free trade agreements” rather than the piecemeal import and re-export shenanigans which have characterized NAFTA. However, at a guess, that brokerage business will be curtailed by the rules going to place of origin which stud the various side letters.

Which, in my view, is no bad thing. It is one thing to buy your printed circuit boards from China, it is quite another to have entire control modules shipped in pieces and “assembled” by putting in a couple of screws in order to evade tariffs.

The Trumpians want to bring actual manufacturing home to the USA, or, at worst, to its trading partners Canada and Mexico. We can argue the economics of this but what Trump sees is jobs. Decent jobs to bring Americans – particularily black and Latino Americans – back into the workforce. So far he seems to be hitting that goal. So much so that there are now more jobs than (technically) unemployed people.

Creating an “employment” economy is very good news for the deplorables, black people and Latinos. Where the demand for labour increases so will its price. For a very long time America seemed to be mired in an economy in which the rich and the upper middle class took the lion’s share of the money and the struggling middle class and the poor and lumpen unemployed were left with crumbs, disability and oxy. Trump’s economics and his concept of “fair trade” seem to be shifting that trend. If he can keep it going he’ll win the mid-terms and he’ll win re-election.

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9 thoughts on “Bullet Dodged

  1. Terry Rudden says:

    The play ended precisely as anticipated. Both sides played the cards they were dealt throughout the negotiation. Trump used America’s overwhelming leverage to create a political deadline (reminiscent of a Cozumel Condo salesman), set out a ridiculous negotiating position (and was caught, and acknowledged it), threatened closure at every point, and played the thug to the great delight of his base and to the frustration of his own negotiating team. Trudeau played David to Trump’s evil Goliath with some success. Domestically, I think Trudeau got the better of it: most Canadian sector councils and opposition politicians rallied round, while Trump seems to have irritated American business and industry, the border states, and the actual conservative elements remaining in the Republican party who favour more open trade.

    And in the real world, the grownups on both side worked their asses off to get an agreement that gave both sides a “victory” to trot back to their respective legislatures, media and electorates, with a communications strategy that will carefully celebrate each side’s Big Win, explain away the concessions as insignificant, and not contradict the other guy’s narrative too visibly.

    • Dwayne says:

      Trudeau and his virtue signalers went into these negotiations with no economic plan in hand at all. They brought to the table social policy crap that had no business being involved in trade talks, and they were summarily ignored by Mexico and USA. Trudeau is an idiot, and any Canadian that thinks that he was “David to Trump’s Goliath” are idiots as well. That played well to the normal CBC crowd, low information voters that they are.

      “There is no core identity, no mainstream in Canada,” Trudeau said, concluding that he sees Canada as “the first post-national state.” – so what was there to defend with respect to “culture”.

      When the Washington Post and outlets like Politico say that Trump has a win, you know that Trump has a win. You can spin it anyway you want, Trudeau and his idiots lost.

      • Terry Rudden says:

        “any Canadian that thinks that he was “David to Trump’s Goliath” are idiots as well.”

        Ah. That would be me, then. Cheers.

      • Jay Currie says:

        Well, yes, Terry….but no need to self-identify.

        The win for Canada – and not JT – is that the Liberals were not dumb enough to lose our auto industry in order to protect millionaire dairy farmers. I mean the farmers are still protected but slight adjustments were made.

      • Cytotoxic says:

        “When the Washington Post and outlets like Politico say that Trump has a win, you know that Trump has a win.”

        No you don’t, and I doubt you even have the reading comprehension required to understand what WP and Politico were even saying.

        It’s a worse NAFTA. It makes trade somewhat less free overall. American cars are just going to cost more. That’s basically it. Hopefully an adult like Booker replaces Turmp in 2020 and we can just go back to NAFTA. Or better yet, unilateral free trade.

  2. Terry Rudden says:

    Glad I didn’t bet the farm on the vaunted civility of your correspondents, Jay.

    So yes, instead of giving of rolling over when Trump barked as urged by some nameless pundits, Canada (not “the Liberals”) actually retained supply management and independent arbitration of disputes. Seems to me they did rather better than their critics expected.

    • Cytotoxic says:

      We are not better off for supply management, but we are better off for reversing class 7 milk…which was only implemented 18 months ago…and a higher de minimis spending limit. We are worse off for no Chapter 11. Overall it doesn’t change much and it’s another case of ‘could have been worse’ which is the best you can usually get from Orange Tard.

  3. Dwayne says:

    When you enter into negotiations you need to have some kind of focus. The US had a focus, Canada did not. The result is that Canada is not better off for the negotiations that took place.

    https://www.cbc.ca/news/politics/nafta-usmca-key-changes-1.4845239?cmp=rss

    Terry, sorry, not sorry, as the kids say. Toxic, your name fits, never change. It is a worse NAFTA for Canada, that was the focus of the US, to make it better for them, not us… sucks to have Trudeau in charge of negotiations since he is an idiot, like his supporters. (yup, I said it again Terry, own it)

  4. derek says:

    Trump got what he wanted, an increase in the origination requirements. The other things are minor changes. Much of it was political back and forth on both sides. I suspect in the end the Liberals are going to have more trouble over the milk.

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