Nafta lumber usa softwood
This deal, it is true, rewards bad U.S. behaviour. It does signal that U.S. interests can twist and ignore NAFTA.
posted by Ann Þø @ Friday, April 28, 2006
Friday, April 28, 2006
⢠â¢
This deal, it is true, rewards bad U.S. behaviour. It does signal that U.S. interests can twist and ignore NAFTA.
posted by Ann Þø @ Friday, April 28, 2006
⢠â¢
1 Comments:
Free trade in lumber was never an option
JEFFREY SIMPSON
Of course, the United States acted badly in the softwood lumber file. Of course, it ignored NAFTA rulings it did not like, thereby bringing the legitimacy of the entire agreement into question. Of course, the U.S. collected illegal and outrageous duties under the so-called Byrd Amendment. Of course, a group of U.S. legislators and one powerful lobby group obstructed progress. Of course, the U.S. acted like a bully in this file.
So? When NDP Leader Jack Layton and other opposition MPs spent Question Period yesterday crying "sellout," and demanded the Harper government not agree to a proposed softwood deal, what alternatives did they have in mind?
Predictably, they had none but more of the same: More legal actions, more rhetoric, more futility, because that is what lay ahead.
This little space down here has blown off plenty of steam about the softwood file and the perfidy of the Americans. They got one rather strange World Trade Organization ruling going their way, and a series of NAFTA ones against them, then called the whole thing a legal tie, which of course it wasn't.
But all the posturing Canada could muster -- and it could muster a lot -- would not change the essence of the U.S. position that no free trade in lumber could or would exist. And full free trade still won't be in the deal announced yesterday.
It didn't matter how many favourable North American free-trade agreement rulings. It didn't matter how much Canadian speechifying. It didn't matter how much Canadian lobbying. There wasn't going to be free trade in lumber. There wasn't free trade in the original Canada-U.S. deal, and there wouldn't ever be.
There will be managed trade, not free trade.
So the choice before Canada was: the whole loaf of free trade in lumber, or three-quarters or two-thirds of a loaf of managed trade.
The former was preferable; the latter was attainable.
The outline of a deal has been apparent for months -- certainly since last summer. It had four elements. First, a fixed share of the U.S. market for Canadian lumber, somewhere in the 32 to 35 per cent range. Second, an export tax imposed by Canada, or a tariff imposed by the U.S., on exports beyond that level. Third, the reimbursement of $4-billion of the $5-billion the U.S. collected through tariffs on softwood lumber. Fourth, there would be no more legal harassment from the U.S. industry.
This deal more or less respects all four elements, with one important wrinkle: that a small tariff can be levied, depending on the board price of lumber, at market shares below 34 per cent. The tariff will be less important in the overall economics of the industry than the exchange rate, and is therefore bearable.
The Liberals, in irresponsible high dudgeon yesterday, knew the outlines of this deal when they were in office. Nonetheless, they insisted, when in power, on going for broke, demanding unfettered softwood access and return of all collected money -- demands backed by NAFTA rulings, politically popular in Canada, but of no political force in the U.S.
Canada's problems in softwood lumber were not only south of the border. Canada's softwood industry was always split; as were the provinces.
No deal -- no matter which party governed Ottawa -- could possibly have satisfied all industrial and provincial concerns in Canada.
Perhaps the most long-term salutary benefit from the screaming opposition of some provincial voices to this deal will be to make the neophyte Conservatives in Ottawa understand how difficult, and usually futile, it is to try to please all provinces all the time.
No deal -- no matter which federal government negotiated it -- would ever have satisfied all Canadian interests. To have waited for unanimity would have been to wait forever. Such is the luxury reserved to a party such as the NDP that will wait forever to be in power; such was not the luxury that Canada could afford.
This deal, it is true, rewards bad U.S. behaviour. It does signal that U.S. interests can twist and ignore NAFTA. It does repay a certain extortion by allowing the U.S. to keep some of the tariff money it collected. And it is managed, not free, trade.
But the deal brings peace at a reasonable price, provides stability, meets the test of what was possible under the circumstances, and should therefore be supported.
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