Canada-US Trade Relations

[Rifleman62]

http://www.smalldeadanimals.com/

J.J. McCullough’s reality check in WaPo;

Comments at SDA from the person who posted the article above:

The op-ed is paywalled, so I’ve quoted it in full.

Trump isn’t bluffing on NAFTA, just as he wasn’t bluffing on  DACA and he wasn’t bluffing on the Paris Climate Agreement, and he wasn’t bluffing on the Iran deal.

"Lengthy posts and fully quoted articles are posted here. Link to these large posts in the regular boards."
https://milnet.ca/forums/threads/128225.0.html

 

[daftandbarmy]

I just read the Trump tweets about how Canada terrorizes the US economy. Has that man ever uttered a real fact in entire his life? Who can possibly believe the trash he trots out? It doesn't even match US govt figures. I mean, politicians like to BS-I get it-but I can't ever recall anybody remotely like this. Certainly not in US history, not even Clinton in his Monica and Whitewater days.

On a more positive note, it was very interesting to see both Doug Ford and Stephen Harper express their support for the Govt as it struggles with resurgent US protectionism and voodoo economics. But I guess it makes sense: some Canadians may have forgotten that Free Trade with the US was originally a Tory deal worked out with a Republican Govt, and both parties have traditionally been big defenders of free trade. (Unlike the Liberals, NDP and Democrats)

Well, after all, he was off to meet with a guy who actually runs his own concentration camp (and ghetto nuclear) program, so he had to look tough. If nothing else, Canada is like the kid you always stuff in the locker in Grade 8: we take a licking and keep coming back to try and be your friend.

 

[AlexanderM]

All of this talk of trade boycotts is fine...but do people really understand the level of effort it is going to take to truly decouple the Canadian economy from the US market?

It is going to take a WW2 level of coordinated effort and a lot of the little "provincial" protection crap we put up with is going to have to be sacrificed as we seek new markets and sources of machinery.  In short, it is going to be painful and expensive. Just sayin.

And Trump doesn't get it, he just wants to be able to hit a switch. The F-35 gets parts from Canada, Boeing gets parts from Canada and every other production line in the US that gets parts from Canada and the other way around would have to re-source. The good news is because we pretty much spend dollar for dollar with the US, we could in theory take that money and redirect it into Canada, but that is only in theory, in reality it's a nightmare.

 

[Jarnhamar]

All of this talk of trade boycotts is fine...but do people really understand the level of effort it is going to take to truly decouple the Canadian economy from the US market?

You mean it's harder than just tweeting #BoycottUSA or #buyCanada?

 

[SeaKingTacco]

You mean it's harder than just tweeting #BoycottUSA or #buyCanada?

:nod:

Look- if Canadians really mean it and want to have an immediate effect- don't travel to the US.

No more cross border runs for cheap gas and milk.

No more Disneyland, Arizona in the winter, Disneyworld, New York, Hawaii and Vegas trips.

But that would take self-sacrifice.

 

[Cloud Cover]

https://www.carlstargroup.com/news/category/press-release/the-carlstar-group-to-increase-prices


Link is a perfect example of Trump shooting his trade war right into the face of US companies that chose to import steel from China. These companies are not going to source domestic steel and aluminum, they are simply increasing prices to match increased costs of importing. It is US consumers who will be carrying the burden.

 

[Rifleman62]

http://brianlilley.com/what-trudeau-did-to-set-trump-off-it-will-surprise-you/  (Videos at link)

What Trudeau did to set Trump off. It will surprise you! - Brian Lilley - 13 Jun 18

Extract: 1. At 4:15 in the clip below (at link), Russo (CBC Ottawa Bureau Chief) starts to describe how the meeting, the bilateral between Trudeau and Trump is going so well that Trump waives his demand of a sunset clause. The Americans had been demanding that NAFTA expire and need to be reaffirmed every five years.

            2. I (Lilley) listened back to Trump’s news conference as he left the G7 and he said that he still wanted a sunset clause but left open the possibility of a longer timeline, said negotiations were going well and the two sides were close. “We’re pretty close on the sunset provision,” Trump said. “You have one group that wants to have five years and then a renegotiation, and you have another group that wants longer because of the investments but we’re pretty close.”

          3. Trump reportedly left the meeting thinking he had made a deal with Trudeau and had made a gracious gesture. Then Trudeau came out and sounded like he was fighting in his news conference when asked about the sunset clause. I’m (Lilley) still not sure what Trudeau said that was different, he was sticking to his old script. But maybe that was the problem.

 

[Edward Campbell]

I think Mr Lilley is being too hard on Prime Minister Trudeau. I suspect that the Canadians had, before the G7 summit, concluded that what President Trump says, at any moment, is worthless ... he might, often will change his mind in minutes, days or weeks, on a whim.

I'm sure the sunset clause was, indeed, "off the table" in that instant, but i do not blame the PM or his team for sticking with the established, 'dollar for dollar' retaliatory tariffs, script until Team Trump, the official US delegation came back to the table saying, "OK, we do not need a sunset clause; what's the next item on our agenda?" Even then I wouldn't be too sure because this is an administration with absolute zero respect for honesty or constancy in negotiation.

President Trump is sui generis; the centuries old rule book for diplomacy is worthless; he is, quite simply, a chronic liar, I doubt he knows or cares about truth and lies ... what he wants, this instant, is "good" and "true," anything else is a "lie" and "bad." A three year old having a temper tantrum is my closest analog to President Donald J Trump.

 

[tomahawk6]

Canada lost 7500 jobs last month.Maybe the PM can explain that.

http://www.cbc.ca/news/business/employment-unemployment-jobs-may-1.4697522

 

[Jarnhamar]

Canada lost 7500 jobs last month.Maybe the PM can explain that.

http://www.cbc.ca/news/business/employment-unemployment-jobs-may-1.4697522

He doesn't have to. All people see and care about now is that he's fighting with Trump and they love it.

I'd almost suggest it was a very clever and calculated move by the PM's office to increase his approval ratings and distract from his recent record of follies.

 

[Good2Golf]

Canada lost 7500 jobs last month.Maybe the PM can explain that.

http://www.cbc.ca/news/business/employment-unemployment-jobs-may-1.4697522

Perhaps the same way the President explained the loss of 140,000 jobs in Q3 last year? ???

Regards,
G2G

 

[Edward Campbell]

Canada lost 7500 jobs last month.Maybe the PM can explain that.

http://www.cbc.ca/news/business/employment-unemployment-jobs-may-1.4697522

In so far as jobs are tied to trade ~ and something like 1/3 to 1/2 of Canadian jobs are trade dependent and 75%+ of our trade is with the USA then the current state of affairs, principally the uncertainty over NAFTA and now the tariffs is, almost certainly, scaring companies and investors away from Canada. I would hazard a guess that 2,500 of those 'lost' jobs are tied, very directly to what Donald J Trump has said and done.

But, and this is an important 'but,' any reasonably fair reading of history says that free(er) trade ALWAYS brings periods of (relative) peace and prosperity while trade wars often end up in bloody shooting wats. No person with the brains the gods gave to green peppers believes, even for a f'ing μsecond that anyone ever wins a trade war. President Trump, of course, does believe that he can and will win a trade war, but see my comments about gods, brains and green peppers.

I don't know when the American people will put aside their fear ~ and that's what it is ~ of change and accept that America reached the zenith of its power in the 1950s* and the world is, as it always has, changing and Bismarck was wrong: there is no "special providence" that protects fools, drunks and the USA. Until Americans can face reality the Trump Party, or something worse, will be in the driver's seat and the world will be a poorer place ... I'm not sure who replaces America as the indispensable nation, but someone needs to step up because unless America grows up it is finished.

* Britain reached the peak of its power circa 1835, it took 60 years for the world to notice; Britain was still a major but no longer a really great power in 1935, by 1985 Britain was a second or even third tier power, albeit a nuclear tipped one. It was even thus; eee Paul Kennedy and others, but Kennedy should have looked father back because his thesis holds for thousands, not just hundreds of years.

 

[Good2Golf]

...But, and this is an important 'but,' any reasonably fair reading of history says that free(er) trade ALWAYS brings periods of (relative) peace and prosperity while trade wars often end up in bloody shooting wats. No person with the brains the gods gave to green peppers believes, even for a f'ing μsecond that anyone ever wins a trade war. President Trump, of course, does believe that he can and will win a trade war, but see my comments about gods, brains and green peppers....

In President Trump's world, "Losing LessTM" IS winning...more than the other guy.

To wit...

https://www.bloomberg.com/view/articles/2018-06-07/donald-trump-the-lose-lose-negotiator

  OPINIONPolitics & Policy

Donald Trump, the Lose-Lose Negotiator

Consulting the classic text on “win-win” negotiation to see what a better trade policy might look like.

by
Justin Fox
‎June‎ ‎7‎, ‎2018‎ ‎07‎:‎00

President Donald Trump’s approach to negotiations, on trade in particular, has had me scratching my head a lot lately. In an attempt to understand it and its likely consequences better, I finally sat down this week and read the classic 1980s book on deal-making.

No, not 1987’s “Trump: The Art of the Deal.” I mean “Getting to Yes,” the 1981 guide to “win-win” negotiation by Roger Fisher and William Ury that was still hitting business bestseller lists in the 1990s and 2000s and came out in a third edition in 2011. The book was a product of the Harvard Negotiation Project that law professor Fisher, anthropologist Ury and then-just-out-of-college Bruce Patton — whose name was added to the cover for the second edition in 1991 — had founded in 1979 as an interdisciplinary effort to improve the theory and practice of negotiation.
...
It suggests that you look for mutual gains whenever possible, and that where your interests conflict, you should insist that the result be based on some fair standards independent of the will of either side. The method of principled negotiation is hard on the merits, soft on the people. It employs no tricks and no posturing.

“No tricks and no posturing” does not sound like the Donald Trump style of negotiation. Still, let’s go through the four key steps of the “Getting to Yes” method and see how they compare to Trump’s approach. They are:

1.Separate the people from the problem.
2.Focus on interests, not positions.
3.Invent options for mutual gain.
4.Insist on using objective criteria.

Trump is not awful on the first. Yes, he’s big on name-calling, but he doesn’t seem to take it seriously and, as he is apparently planning to make clear with North Korea’s Kim Jong Un in Singapore next week, he’s perfectly willing to turn around and talk with those with whom he’s been trading insults.

The part about “using objective criteria” seems problematic given how much Trump hates being hemmed in by objective reality. The big issues, though, are with numbers 2 and 3. Trump’s fundamental approach — especially on trade — is zero-sum. As economic journalist Adam Davidson put it more than two years ago:

His whole worldview is based on a rent-seeking vision of the economy, in which there’s a fixed amount of wealth that can only be redistributed, never grow. It is a world­view that makes perfect sense for the son of a New York real estate tycoon who grew up to be one, too. Everything he has gotten — as he proudly brags — came from cutting deals. Accepting the notion of a zero-sum world, he set out to grab more than his share.

Or as Trump himself put it in a 2007 book:

You hear lots of people say that a great deal is when both sides win. That is a bunch of crap. In a great deal, you win — not the other side. You crush the opponent and come away with something better for yourself.

I don’t believe that Trump truly thinks he can “crush” everyone he deals with — one cannot put together a nearly five-decade business career, even as checkered a one as his — with that attitude. But he does think it’s crucial to be perceived as winning, and he does tend to frame the outcomes of negotiations as binary. In a such a contest, there is no win-win solution that serves both sides’ interests, just a winner and a loser (or an unsatisfactory draw). There are no interests, just positions. This may be a fair depiction of how some parts of the New York City real estate world work. It definitely describes electoral politics, a field in which Trump scored a famous victory in 2016.

Trade, though, is the quintessential win-win endeavor. When you buy something you want from someone who can make it more efficiently than you can, you leave both yourself and the other person better off. This doesn’t mean more foreign trade always leaves every individual in every nation better off, or that nations can’t sometimes use restrictions on trade to gain economic or military advantage. Free-trade boosters too often gloss over these complications. But trade is emphatically not zero-sum. Talking about it in terms of winning and losing, and using trade deficits and surpluses to keep score, as Trump does, almost completely misses the point.

Along the same lines, a trade war that decreases overall trade volumes — which is what the Trump administration appears to have embarked upon — is highly unlikely to produce any winners in absolute terms, although there may be relative winners. As Australian National University economists Warwick J. McKibbin and Andrew Stoeckel concluded after an economic modeling exercise last year:

Under a trade war scenario, all countries are worse off, some more than others due to their trade exposure. The losses to China, Germany and ‘other Asia’ are some three times larger than for the US.

The U.S. wins! Except that it’s still poorer than if it hadn’t started the trade war in the first place, and has in the process alienated the leaders of just about every important economy on Earth. Also, in the McKibbin-Stoeckel model, the combined impact of Trump’s trade and fiscal policies widened the U.S. trade deficit substantially — and the deficit has in fact grown since Trump took office last year. So that’s awkward.

It’s possible, of course, that the administration’s brinkmanship on trade is simply a bargaining tool that will eventually result in great deals that serve American interests. It would be a lot easier to believe that, though, if Trump had ever coherently defined what those interests are. His focus to date has been almost entirely on positions, not interests.
...
Perhaps the most important section of “Getting to Yes,” given current events, is the chapter on what to do “when the other side won’t play” — when your adversary keeps posturing and positioning instead of looking for shared interests. The advice is:

Do not push back. When they assert their positions, do not reject them. When they attack your ideas, don’t defend them. When they attack you, don’t counterattack. Break the vicious cycle by refusing to react. Instead of pushing back, sidestep their attack and deflect it against the problem.

This “negotiation jujitsu” — which apparently involves asking lots of questions and tolerating long, awkward pauses — sounds like it takes a lot of patience. For domestic adversaries who hope to best Trump in the zero-sum electoral arena, it’s probably not the best approach. For U.S. allies and those here who wish to steer discussions on trade and other matters in a more constructive direction, though, it may be the only win-win option on the table.

 

[pbi]

Concerning Trump's apparent lack of concern for facts, take (for example) his rantings about the dairy trade issue. He seems to be holding out the battered, bleeding body of the Wisconsin dairy industry as an example of how Canada has selfishly and heartlessly screwed the dairy farmers of America.

So, I looked up a few things, starting at the source. Here, at the Wisconsin Milk Marketing Board: http://www.wisconsindairy.org/assets/images/pdf/WisconsinDairyData.pdf. That state produced over 132 million hectolitres of milk last year.

Then, I looked for the figures on Canada's total total milk production last year, here: http://www.dairyinfo.gc.ca/index_e.php?s1=cdi-ilc&s2=aag-ail. All commercial dairy production in Canada totalled 84 million hectolitres of milk.

So, right off the bat, Wisconsin alone dwarfs our entire dairy industry just in milk production alone. But what about the trade relationship in dairy?

Here, http://www.usdec.org/research-and-data/market-information/top-charts-x1507the US Dairy Export Council says that Canada received 636 million dollars US worth of US dairy products. (Second  export destination after Southeast Asia, above China). In return, here: http://aimis-simia-cdic-ccil.agr.gc.ca/rp/index-eng.cfm?action=gR&signature=DB98579E7869437BF7300588097E0488&pdctc=&r=166&pTpl=1&pr=2 ,we exported 140, 584, 000 dollars Cdn worth of dairy to the US.

So, how is it we're destroying the US dairy industry, again?

If I have to pick which dairy farmers to defend, I'll pick the ones in my own country, thanks.

 

[Colin Parkinson]

The best way to counter him is to express such facts and be willing to run ads in newspapers/media in the US. Avoid anything that could be taken personally and allow a opening that he can use while saving face. Both JT and Trump are going to face a difficult election period, so everything is focused to those events.

 

[Good2Golf]

Concerning Trump's apparent lack of concern for facts, take (for example) his rantings about the dairy trade issue. He seems to be holding out the battered, bleeding body of the Wisconsin dairy industry as an example of how Canada has selfishly and heartlessly screwed the dairy farmers of America.

So, I looked up a few things, starting at the source. Here, at the Wisconsin Milk Marketing Board: http://www.wisconsindairy.org/assets/images/pdf/WisconsinDairyData.pdf. That state produced over 132 million hectolitres of milk last year.

Then, I looked for the figures on Canada's total total milk production last year, here: http://www.dairyinfo.gc.ca/index_e.php?s1=cdi-ilc&s2=aag-ail. All commercial dairy production in Canada totalled 84 million hectolitres of milk.

So, right off the bat, Wisconsin alone dwarfs our entire dairy industry just in milk production alone. But what about the trade relationship in dairy?

Here, http://www.usdec.org/research-and-data/market-information/top-charts-x1507the US Dairy Export Council says that Canada received 636 million dollars US worth of US dairy products. (Second  export destination after Southeast Asia, above China). In return, here: http://aimis-simia-cdic-ccil.agr.gc.ca/rp/index-eng.cfm?action=gR&signature=DB98579E7869437BF7300588097E0488&pdctc=&r=166&pTpl=1&pr=2 ,we exported 140, 584, 000 dollars Cdn worth of dairy to the US.

So, how is it we're destroying the US dairy industry, again?

If I have to pick which dairy farmers to defend, I'll pick the ones in my county, thanks.

There you go with TRUE FACTSTM again, pbi.  Many of the sources I also used in my research for facts, and while openly available to anyone with a computer or smart phone and a search engine, not many people seem to actually inform themselves of such facts.  Real Donald tweets and Fox episodes sadly hold the day for many.  :not-again:

Regards
G2G

 

[pbi]

Canada lost 7500 jobs last month.Maybe the PM can explain that.

http://www.cbc.ca/news/business/employment-unemployment-jobs-may-1.4697522

Yes, true. But that may not mean all that much. If you look here: https://www150.statcan.gc.ca/n1/daily-quotidien/180105/dq180105a-eng.htm, national unemployment is at the lowest point since 1976.

So that figure (doomsayers aside) may just be a down-blip on an upward trend.

 

[tomahawk6]

US unemployment is 3.8 %.

 

[Altair]

US unemployment is 3.8 %.

let us all see what it is after the USA is involved in a trade war with nostalgia of the planet

 

[tomahawk6]

I don't want a trade war because there will be no winners.Americans do vacation as well.

https://nypost.com/2018/06/14/canadians-boycott-us-products-cancel-vacations-to-america/