Tag Archives: NAFTA

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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No News is No News

Just watched the 20 minute Chrystia Freeland “news” conference.

Apparently she’s promised “not to negotiate in public” which means she is unwilling to address any substantive questions at all.

This week’s talks have ended but they will be back at it Wednesday of next week.

Just one problem, which Freeland, of course, dodged, Trump has basically said that he is not moving on any of the key points and that he’d be just as happy to drop a 25% tariff on Canadian made cars. Kinda tough to negotiate around that.

Which means that, after a week of “intense” negotiations Freeland is going back to Canada with nothing except the fact that The Donald is planning on taking his bilateral agreement with Mexico and notifying Congress that it will be signed 90 days from now.

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