Newman on NAFTA: Canada’s Full Court Press in Washington and Why it May Not Be Enough

,

[:en]Ensight’s Don Newman on how high the stakes are for Prime Minister Trudeau during the fourth round of NAFTA talks in Washington and why President Trump may just walk away

Prime Minister Justin Trudeau is visiting Washington this week to meet with President Donald Trump and important members of the U.S. Congress.

Why this week? Well this is the week the negotiations for a renewed North American Free Trade Agreement could collapse. And Trudeau wants to be seen as doing everything possible to try and prevent that.

The fourth round of talks to revise the 25 year old agreement begin Wednesday in Washington. ‎This is the round where the Americans are expected to put their most contentious issues on the table.

These issues include:

Buy American / Hire American

The controversial demand that United States‎ companies have the right to bid on Canadian Government contracts, but government contracts in the United States are reserved for only local companies, under the Trump administration’s “Buy American. Hire American” plan.

Car Manufacturing

The demand that all cars manufactured in the three NAFTA countries have a minimum of fifty per cent of their content originate in the United States. Present NAFTA content rules require that sixty-two point five per cent of a car must come from any of Canada, the U.S. or Mexico to pass duty free among the three countries. Raising the content rules as proposed by the Americans would mean that NAFTA countries content would be over eighty per cent, with the overwhelming amount of that content American.

Dispute Settlement

And the proposals for a changed dispute settlement arrangement. The Americans say the present method of settling disputes by independent panels whose members are drawn from all three countries is unfair to the U.S. They want U.S. Trade law, courts and tribunals to adjudicate disputes.

Both Canada and Mexico have said this proposal is a deal breaker that will kill NAFTA. And seeing the way U.S. Trade tribunals are hammering Canada in the Bombardier – Boeing dispute and on Canadian Softwood lumber exports, the resolve to say an emphatic “NO” to putting those same arrangements in NAFTA will only be strengthened. But saying “no” to these proposal will give President Trump the opening he is looking for.

During the election campaign last year Trump said he would either reform NAFTA or kill it. Many people have thought killing it is his real objective. Rejection by Canada or Mexico of the one-sided U.S. proposals put forward this week‎ would give him that opportunity. This week’s visit by Prime Minister Justin Trudeau is a last ditch effort to prevent that from happening. It is unlikely to be enough.

Don Newman is Senior Counsel at Ensight, a Member of the Order of Canada, and a life-member and past president of the Canadian Parliamentary Press Gallery.[:]

Lessons on losing: What the NDP can learn from the 2011 Liberals: Mackenzie

,

[:en]The recent NDP leadership ended decisively, with a first-ballot win for Brampton MPP Jagmeet Singh. Without a seat in the House of Commons of his own, Singh expects (unless an opportune by-election crops up) to be on the campaign hustings on his own for the next two years straight.

He’s an interesting — and possibly risky — choice for the NDP: a federal outsider without provincial NDP government experience, someone who is not a current federal caucus member. But those aren’t really the things New Democrats need to worry about right now.

The larger challenge for the NDP is one of identity — of figuring out who they are and what they stand for. The party gambled in the 2015 campaign on outflanking the Liberals through a balanced budget pledge. That shift in direction left many Canadians uncertain about what a ideologically flexible NDP might do next.

For some lessons on how this self-evaluation process might look, it’s worth taking a look back to 2011, when the Liberals — who also had just experienced a fall from Official Opposition to third party status — initiated a very deliberate process of ‘rebuilding’ their party.

This rebuilding project was a pragmatic process of evaluation — not an exercise in nostalgia. Liberals attended roundtables where they told one another why they were Liberals — what the Liberals should stand for, what policies they should champion, what would convince everyday Canadians that Liberals were a vibrant political movement worth considering again.

In Justin Trudeau’s book Common Ground, he describes his key advisers sitting around a campfire and talking about the possibility that the Liberal party was a spent political force. They talked about how Preston Manning and Stockwell Day created new parties with new names and the same old MPs. (Who knows what that would have looked like? The Progressive Party? The Liberal Democrats?)

Reminder: Before the 2015 election, the NDP had the largest caucus in its history. The election pulled the rug out from under them. In Opposition, New Democrats talked seriously about being ready to govern and pointed to the experience of provincial NDP governments by way of example. Defeat robbed the party of its raison d’être.

Many New Democrats haven’t understood that loss yet for what it was. Many Canadians don’t know now what distinguishes the NDP from the Liberal party, what makes New Democrats more qualified than the Liberals to move forward progressive ideas.

Parliament won’t help. Tom Mulcair made a reputation for himself as Stephen Harper’s most savage opponent in the Commons. The NDP’s new leader may not even make it to question period for another two years. In the meantime, Singh has tapped former leadership rival Guy Caron to lead his caucus day-to-day.

Singh has made some moves to distinguish himself from his rivals and, by extension, from the Liberals — such as his pitch to decriminalize personal recreational drug use. But he still has a lot to lose in 2019 and much ground to make up. Prime Minister Trudeau continues to be seen as a symbol of progressivism around the world.

The NDP supporters who voted strategically in 2015 to defeat the Harper Conservatives may be alarmed by recent polling showing a rise in support for the Conservatives — and decide to park their votes with the Liberals for safekeeping. New Democrats likely will be playing defence in certain regions they currently hold, which may draw their attention and resources away from taking Liberal-held seats in urban, multicultural areas.

The only virtue in defeat is the opportunity to become better. Every party eventually needs to restore itself — but the process typically involves some serious self-interrogation. New Democrats need to ask themselves what they can offer that no other party can.

Singh has two years on the outside now, time he can put to good use in rebuilding the party. And being an outsider can have benefits. Singh likes to compare himself to Jack Layton. It took Layton three elections to be considered. Like Layton, Singh can afford to be patient.

But a party leader who leads from the outside runs a risk. The next election will be an evaluation of what Trudeau has done with power. Without an actual third-party leader there to hold Trudeau to account in the House of Commons, Singh’s placeholder Parliamentary caucus representative is going to see his lunch eaten daily by Conservative Party Leader Andrew Scheer.

Good luck, Jagmeet Singh. The path from third place to first is seldom easy to follow.

(As published in iPolitics on October 8, 2017)[:]

The changing faces of Canadian politics: Watt

,

[:en]As the seasons have changed, so too has the Canadian political landscape.

The October 2015 election of a Liberal government led by Justin Trudeau began a major shift from dominance by Baby Boomers to a younger generation. Voters chose Trudeau’s youth and optimism over the experience of the other party leaders.

Just two years later, Trudeau is now the oldest of the three main federal party leaders. Conservative Leader Andrew Scheer and newly crowned NDP Leader Jagmeet Singh are both 38, Trudeau is 45.

Scheer and Singh were chosen by their parties, at least in part, as a response to the youthfulness Trudeau brings to his leadership. The three are the youngest group of federal leaders in Canadian history.

It’s a remarkable shift, especially when contrasted with many Western democracies, whose increasingly older populations embrace greyer, more experienced leaders. (France, of course, is a notable exception.)

In the United Kingdom, Prime Minister Theresa May, 61, faces off in Parliament against Labour Party leader Jeremy Corbyn, 68.

In the United States, President Donald Trump, 71, still rails on about 69-year-old Hillary Clinton. Among Trump’s potential rivals in the next U.S. presidential election are California Governor Jerry Brown, 79, Senator Elizabeth Warren, 68, and Senator Bernie Sanders, 76.

But in Canada we are witnessing more than just a generational change.

Singh’s decisive victory last weekend raised the curtain on a new Canadian political pageant — one that is beginning to more accurately reflect the growing diversity of this country.

Growing up in Windsor in the 1980s, Singh saw a Canadian political establishment that consisted largely of white, older, straight men. It was an establishment that did not reflect him, his family or his friends.

In fact, throughout his leadership campaign, pundits and other commentators spoke or wrote in code about whether Singh’s Sikh identity could prove a challenge in a general election.

Just as Barack Obama’s victory was eight years ago, Singh’s convincing win was, at least in part, a rebuke of those whispers — whispers that likely will mean nothing to most Canadians when they cast their ballots in 2019.

Another shift came the day after Singh’s win when Julie Payette, 53, was sworn in as Governor General.

She, too, represents generational change, but she also represents more.

The institution of the vice-regal office is, of course, traditional by its very nature, and despite the dedicated efforts of predecessor David Johnston and his wife Sharon to humanize the post, and their success at genuinely connecting with Canadians all over the country, many see Rideau Hall as far removed from everyday life.

But Payette’s warm and enthusiastic demeanour is as inspiring as it is engaging. Her down-to-earth approach allows her to come across as accessible and approachable. Her ability to speak passionately and eloquently for nearly 20 minutes about our country and its future, without notes, makes her not only genuine and authentic but allows her to connect with her fellow citizens.

A former astronaut who has twice been to space and who speaks six languages, our new Governor General is an impressive person, with a long record of accomplishments. She has long been a role model.

And on Monday, in one poignant moment, Payette blazed a new trail, while at the same time reflecting the current reality of many Canadian families: she arrived at her installation ceremony as a single woman with her 14-year-old son by her side.

According to Statistics Canada, about 20 per cent of families in Canada are headed by a single parent. But until now, a single parent had never served as Governor General.

Payette also chose to affirm her loyalty, rather than swear an oath on the Bible. As religion’s role in the lives of Canadians is changing, here was another example that Canada’s leadership is more closely resembling the population.

There are other important role models whose lives and experiences mirror those of other Canadians. The premier of Ontario is a lesbian and the premier of Prince Edward Island is a gay man.

Canada is a diverse, inclusive and welcoming place. How lucky we are, and how lucky are our children, that our political leaders are beginning to look more like all of us.

Jaime Watt is the executive chairman of Navigator Ltd. and a Conservative strategist.

(As published in The Toronto Star on October 8, 2017)[:]

This Week’s First Ministers’ Meeting Marks A Turn in Trudeau’s Dialogue with the Premiers

,

[:en]Canada’s Premiers gathered in Ottawa this week but the tone was very different than their first meeting in 2015. Our John Delacourt on a changing perception of government and working effectively with Canada’s Premiers.

In November of 2015, in the early days of this government, one of the significant gestures Trudeau made was to convene a First Ministers meeting, prior to the COP 21 meeting in Paris, to work on a concerted effort to address climate change. There was nothing agreed upon at that time, other than a resolution to meet again 90 days after the Paris meeting, yet it was less about decision making than it was about a new dialogue, a new tone, a new way of working together.

Indeed it had been six years since the Premiers had last met in this fashion. Harper never really warmed to the idea of convening these working sessions; it took the recession to create the suitable conditions for a hanging to concentrate his mind. A little more than half a decade later Trudeau, with a buoyant economy and a spring in his stride, walked into that first meeting intent upon establishing a strong working rapport and a commitment to meeting again soon – and often.

At this week’s First Ministers’ Meeting here in Ottawa, it is clear that collegiality is no longer the high priority it once was, given the challenges looming for a government in mid-mandate. Chief among them is bringing revenue in to the coffers. In the first day of the Ministers’ sitting down this week, Trudeau called upon Bill Blair, the former Toronto Police Services Chief and current Parliamentary Secretary for Health and Justice, to deliver the sobering news that the federal government will be proposing a ten percent tax on the recreational use of marijuana.

If there had been sufficient indication this was coming, the Premiers’ reactions suggested otherwise.

You can understand why many of the Premiers felt blind sided and reacted so negatively. One of the fundamental tenets of the government’s rationale to legalize marijuana is that, by providing a regulated, safe and lower cost alternative to the product currently sold illegally, they will drive the criminals out of business. It will be harder to make the lower cost argument when the combined provincial and federal tax on each product sold could be 25 percent.

And even more concerning to many, is the inequitable sharing of the work with regard to the enforcement of regulations, the policing and the changes to laws and bylaws that has to occur. Yet Trudeau, in his follow-up interviews this week, gave no indication that the federal government was prepared to back down from Blair’s presentation.

On its own, it might be overlooked, but given the fallout of liberal members of the Status of Women parliamentary committee flatly walking out and rejecting the decision to elect a Conservative Chair, and in the continuing saga of Morneau’s proposed tax changes facing a revolt from everyone from small business owners to doctors, a new perception is emerging. This new perception paints the picture of a government less receptive than resolute and less sunny than stern.

As the Liberal Government turns its focus to managing the complex, harder work of delivering a fall fiscal update and budget that stays the course for continued growth into the early months of the next campaign, surely Trudeau’s team can recall how tone can direct dialogue, and that picking a fight with the Premiers didn’t work out well for the last Prime Minister.

A former director of communications for the Liberal Research Bureau, John Delacourt is Vice President of Ensight.
[:]

The Singh Victory: Spin Versus Reality

,

[:en]Jagmeet Singh’s first ballot win today in the NDP leadership contest is going to generate a great deal of copy and punditry from across the political spectrum. Herewith is a quick reality check with regard to the spin, pro and contra-Singh, that you’re about to read and hear.

Contra:
He’s a 905 phenomenon. Outside of Ontario – and especially in Quebec, the NDP will have trouble making gains and raising their seat count in the next election.

Actually, you could map the areas of the country where Jagmeet’s strongest support is and come up with a worrying picture if you were plotting Team Trudeau’s ground game. Singh’s campaign was able to attract significant numbers for a first ballot victory from parts of the country that include the Lower Mainland and the Greater Vancouver Area, and respectable numbers in urban Alberta as well. Leadership contests are a good read on where the boots-on-the-ground federal campaign support is likely to be strongest and those are communities where key gains for Team Trudeau came from in 2015. As far as Quebec goes, well, in 2008, Stephen Harper’s Conservatives formed a majority government with only 5 seats in la belle province. That’s a victory forged from the old iron of the land of two solitudes, you could argue. But if you’re a political pragmatist, you’d be focused on one thing first and foremost: more seats in the House. If that mantra sounds familiar, it should. It was Jack Layton’s strategy throughout his political career.

Pro:
He’s young, telegenic and bilingual: he’s the NDP’s Trudeau and could catch fire in the same way in the next federal campaign.

It is true that Singh has great potential to grow the party’s vote beyond an older, traditionally progressive base of support. But the dynamics of federal campaigns do not equate to voters swapping out one young, telegenic candidate for another for one simple reason: it is always about the retail, economic issues. You may be tired of the Liberals’ constant messaging about the middle class, but that’s because you’re listening all or most of the time. As the brain trust behind Stephen Harper’s first election victory maintained to great effect, it is the voters who aren’t necessarily listening that winning strategy focuses on and the simple truth remains for every candidate: whoever connects with a plan for the economy that gives the greater number of Canadians reason to be optimistic will always find their way to 24 Sussex.

Beyond the Spin:
The number of seats across the country where a Singh victory might make the NDP contenders is significant. And very few of those – apart from in Western Canada – map on to where the Conservatives might make gains as well. What this could bode well for is a 2019 campaign result that puts the Liberals into a minority and the Conservatives in a strong position to work effectively with the NDP to ensure stormy weather rather than sunny ways for the Liberals’ second mandate. And that might position the NDP for greater gains than ever imagined when Canadians go to the polls again. That could also be sooner than 2023, given how minority governments can go.

There is enough reason for Team Singh to look ahead that far and be optimistic.[:]

NAFTA talks fraught with perils for Trudeau: Watt

,

[:en]A number of things happened last week that underscore the challenges ahead in Canada’s relationship with the United States.

Former U.S. president Barack Obama visited Toronto, just one day after failed candidate Hillary Clinton made an appearance here during her Canadian book tour.

It would be hard to blame Prime Minister Justin Trudeau for thinking wistfully about what might have been under President Hillary Clinton. Obama has long been an advocate of free trade; he moved to expand trading opportunities in the Pacific Rim. Similarly, Clinton has embraced free trade over the course of her career.

Even though she made half-hearted attempts to appeal to the protectionist constituency in American politics during her campaign, it is hard to imagine that, had Clinton won, a major Canadian company would be hit with a 219 per cent tariff and accused of cheating the system.

The announcement that the Bombardier C Series would be taxed at a level of 219 per cent landed like a bombshell, but we shouldn’t have been surprised — it has become a part of a broader pattern for the U.S.

A report produced by the Centre for Economic Policy Research’s Global Trade Alert found that U.S. policy had moved “sharply in favour of domestic firms,” with punitive tariffs up 26 per cent over the last year. Seen in this light, the Bombardier decision is not a mere one-off. It’s part of a broader attack on America’s trading commitments.

In fact, it appears with every passing day that U.S. President Donald Trump’s “America first” policy was more than just rhetoric, but a real threat to all of America’s trading partners.

It is even more difficult to imagine that Clinton as president would have threatened the fundamental trade deal that has underpinned the success of the North American economy for more than two decades.

But instead we have President Trump who has just overseen the third round of the renegotiation of NAFTA. By all indications, things are not going as swimmingly as hoped.

Talks officially kicked off on Aug. 16, and a, 2017 after much preparation on all three sides. As of last week, there has been agreement among the United States, Canada and Mexico on only one relatively innocuous chapter, in a document filled with policy both meaningful and symbolic.

When the Liberals won the 2015 election, no one could have predicted that these negotiations would even be happening. But prime ministers must play the hands they are dealt, and it is now Trudeau’s responsibility to preserve Canada’s economic interests and its access to the American markets as best he can.

That, of course, is easier said than done. October 2019 is closer than it appears, and the government has officially entered the latter half of its mandate — a time when the pressure to consider domestic politics and optics grows.

Trade negotiations are lengthy, complex and often turn on minute policy details. Moreover, in order to get a deal, governments often have to concede points they would rather not concede.

It is no secret that right now Canada and the U.S. are oceans apart on a variety of policy issues, including labour regulation, the environment and tariffs. These are more than mere disagreements; they are fundamental differences that underpin each government’s domestic position.

These differences have the potential to cause major political headaches for Trudeau on the home front. Should the prime minister be perceived as not pushing hard enough on progressive causes, the NDP would happily step up to fill that void. If he pushes for inclusion of progressive policies, he risks losing the deal that underpins the Canadian economy.

Perhaps most notably, Unifor has formally called on the Canadian government to demand that the United States present legislation to rescind the right of states to implement “right-to-work” legislation. Right-to-work laws, which stipulate that union dues cannot be mandatory, are in effect in 28 U.S. states. Unions say this “right-to-work” is just another name for union-busting, while advocates of the laws argue they create a pro-business environment.

The emergence of this issue shows just how fraught with political peril the NAFTA negotiations are for Trudeau. Other issues on the prime minister’s left flank include Indigenous rights, environmental regulations, wages and government subsidies.

Trudeau’s position is not enviable. However, the danger of not signing a deal is far greater than the danger of signing one that angers more progressive Liberal supporters. Should a deal not proceed, or should the intemperate Trump decide the United States should simply pull out of NAFTA, the economic havoc that would ensue would be just one of the prime minister’s problems.

The political consequences would be far greater. No doubt, the prime minister, and his very astute advisers, are more than well aware of that.

Jaime Watt is the executive chairman of Navigator Ltd. and a Conservative strategist.

(As published in The Toronto Star on October 1, 2017)
[:]

Newman on NAFTA: Does the Boeing/Bombardier dispute set a dangerous precedent for Canadian companies?

,

[:en]Ensight’s Don Newman on the timing of the third round of NAFTA negotiations ending at the same time as the Boeing/Bombardier dispute escalateing and how timing is everything in politics.

Timing is everything.

Foreign Affairs Minister Chrystia Freeland and U.S. Trade Representative Robert Lighthizer have been scrambling to assure everyone who will listen that the massive punitive duties imposed by the United States on Bombardier C series aircraft have nothing to do with the current NAFTA ‎negotiations.

But of course they do. How could they not?

Technically, the two hundred and twenty per cent tariff imposed‎ by Commerce Secretary Wilbur Ross, is the result of a trade complaint against Bombardier launched by Boeing, the behemoth American air plane manufacturer and defence contractor, last spring. But the fact that the tariff Ross imposed is almost three times as much as the penalty Boeing requested shows that there is something more going on.

The tariff announcement came the same day that the third round of NAFTA treaty talks were winding down in Ottawa. There is a feeling that this round was even less productive than the two that proceeded it in Washington and Mexico City. No small feat.

One reason is that the Americans, who forced this renegotiation in the first place, have so far‎ not tabled the one demand, for what is for both Canada and Mexico a make or break clause in the deal. And that is Chapter 19, the independent dispute settlement provisions that allow trade disagreement under NAFTA to be settled by panels of arbiters drawn from all three countries.

The original American NAFTA negotiating objectives tabled with the U.S. Congress said‎ the removal of Chapter 19 was a U.S. goal. So far, what (if anything) Washington wants to replace it with, has not been presented.

If there were to be no replacement at all and President Trump made good on his threat to leave NAFTA, that would mean that every trade dispute would be subject to the same kind of U.S. kangaroo court procedure we have seen Bombardier subjected to in the Boeing complaint.

That is why both Canada and Mexico have said that without an independent dispute settlement process there can be no NAFTA deal.‎ Essentially, we want Chapter 19 maintained.

But what if the Americans propose a watered down version that gives them more chance of winning most trade disputes?

As we have reported before, there is a growing Canadian concern that the Americans are holding back their most controversial proposals on purpose. They will table them as “take it or leave it” as the negotiations progress.

The next round of talks will be in Washington, from October 11th to the 15th. Will this be the time, with any “home field advantage” that might apply, that the Trump administration will table its plans for a dispute mechanism more favourable to American interests?

And will the Bombardier decision be held out as the example of what will happen to Canadian Exporters if we don’t agree?

Bombardier and the NAFTA negotiations have nothing to do with each other? The timing is everything.

Don Newman is Senior Counsel at Ensight, a Member of the Order of Canada, and a life-member and past president of the Canadian Parliamentary Press Gallery.

[:]

Tories fall into Trudeau’s tax trap: Watt

,

[:en]As Parliamentarians made their return to the House of Commons this past week, there was a marked difference in the moods of Liberal and Conservative members.

Andrew Scheer’s Conservatives were cheerfully optimistic about their future, while Liberal government members were considerably less upbeat.

The reason: the federal government had just endured weeks of critical commentary from media outlets and interest groups from across the political spectrum and the country itself.

In mid-July, Finance Minister Bill Morneau announced the government intended to overhaul the system under which Canadian small businesses pay tax, cracking down on “loopholes,” including income splitting, and the taxation of passive income held within a business. The government’s said the changes would affect roughly 50,000 families across Canada — no small adjustment.

The resulting media attention was widespread and highly negative for the government.

The announcement sparked one critical headline after another, coverage that was helped by high-profile campaigns by professional associations like the Canadian Medical Association and the Canadian Bar Association, whose members benefit greatly from the current tax regime.

Stories sympathetic to independent business owners proliferated, describing the challenge the changes would pose to their existence in the gravest of terms.

The media circus even began to undermine caucus solidarity among the Liberals with several MPs making their criticisms public; never a positive sign as many a veteran politician will tell you.

So, it’s hard to blame the Conservatives for being so thrilled. After all, they have had precious little to cheer about since their October 2015 defeat. Their long leadership race to replace Stephen Harper coincided with glowing, almost “criticism-free” coverage of Prime Minister Justin Trudeau. Many partisans were left to wonder if they were now in the beginning stages of a long stint on the Opposition benches.

Then, the Conservatives spotted, what they thought, was a winning opportunity in this tax issue. They then used this fracas to focus MPs and hammer Prime Minister Justin Trudeau in Question Period. They have even been inspired to launch an advertising campaign blasting the proposed changes.

And yet, none of this has budged Trudeau or altered his approach. And it seems that while unusual, the Prime Minister’s approach is an astute one.

It is well accepted that the last U.S. presidential election demonstrated there is a latent fury among citizens who feel their system is fundamentally rigged in favour of the privileged.

That belief that the game is rigged in favour of the rich is true here in Canada as well. And it is growing.

While it may seem as though there has been less turbulence here, that is because of some structural differences between our countries.

The American system was built to be highly susceptible to changes in mood. In Canada, political parties exert far more central control.

As well, in America, markets are large enough to sustain alternative media points of view for long enough to ferment a wider audience. American political culture is also strikingly more public-facing than it is here.

But that doesn’t mean the same turbulence doesn’t roil underneath Canada’s seemingly politically serene culture.

Canadians believe the system is rigged just as much as Americans do. They believe rich Canadians don’t pay their fair share of tax, and that the system delivers advantages to the privileged that are not available to them.

Canadians of all political stripes, of all demographic groups and from all over the country believe this. No amount of campaigning by doctors and lawyers will convince them the wealthy will be unduly hurt under a new tax regime; in fact, these campaigns may be more likely to push Canadians toward the Liberals.

The Conservatives have fallen into the trap of defending a group of privileged Canadians and allowing themselves to be boxed in against the middle class.

It seems that Justin Trudeau has adopted a lesson Donald Trump taught us all in 2016: conventional commentators, more often than not, are drastically out of touch — and leaders should trust their instincts.

Jaime Watt is the executive chairman of Navigator Ltd. and a Conservative strategist.

(As published in The Toronto Star on September 24, 2017 and OurWindsor.ca on the same date)[:]

Trump and the Art of the NAFTA Deal: Mackenzie

,

[:en]In the late 1980s, Donald J. Trump appeared as though he had a future in politics. Take a trip back with me.

As a fresh-faced real-estate mogul in New York City in his early forties, Trump chummed it up with Clintons on the party circuit and even had Oprah tempting him into flirting with an eventual run for President.

In the 90s, Trump’s carefully crafted persona expanded into a successful foray into authorship through The Art of the Deal, which spent 51 weeks on the New York Times’ bestseller list.

The part autobiography, part listicle recommended 11 unavoidable keys to success in business and to making great deals.

Trump’s tome on deal-making is timely considering that now-President Trump is being tested on one major deal and one of his key campaign promises: renegotiating NAFTA. He criticized the deal as “the worst trade deal” ever signed by the U.S. and said that he would get his country a much better deal.

So, will we find some clues to Trump’s NAFTA strategy in The Art of the Deal as we enter Round 3? Let’s find out by examining his tactics for deal-making:

Think big

NAFTA has big stakes. Tens of millions of jobs depend on it. NAFTA countries’ economies have grown together to become the world’s largest free trade area and have a combined output of approximately $17 trillion (U.S.) worth of goods and services. Renegotiating and modernizing it could be big for business.

Protect the downside and the upside will take care of itself

The U.S. has put Mexico and Canada on their back feet in these negotiations by coming to the table aggressively. U.S. trade negotiators charge that hundreds of thousands of jobs “left” or slipped northwards or southwards, and would soon be coming back to them. Canada and Mexico have entered this discussion aiming for a tweak at best to the existing deal. They may be too busy defending their key levers while the U.S. is on the offensive – essentially protecting itself from losing ground.

Maximize the options

This chapter essentially suggests a good negotiator must ensure there are distractions in waiting, including leaving room to negotiate something else – in case this deal falls through. So, if NAFTA falls through – bilateral trade deals with each country remain on the table, although that is not considered ideal for anyone.

Know your market

While Trump may think that his administration speaks for business, industry’s motto is “do no harm” to the existing agreement and arrangements of supply chains. Industry is not onside with the administration’s tactics. It is sheer tone deafness and contrarianism of the U.S.’s Trade Negotiator Lighthizer in saying “tweaks” are not enough.

Use your leverage

Arguably all three countries picked strong negotiating teams with a lot of experience. Well done all around.

Enhance your location

The U.S. got home-team advantage in Washington off the bat, ornate rooms in any nation’s capital will not phase weathered trade negotiators though. No points to anyone. Thankfully it’s still summer weather in Canada going into this weekend’s round. However, if this drags on… winter trade talks could be considered a trade irritant of sorts.

Get the word out

Trade negotiations necessitate a high level of privacy. Trump’s use of his rallies throughout August to loudly threaten again that the U.S. will walk away from NAFTA was a clear play for media and the other countries to induce panic. As neither Canada nor Mexico have taken the bait – both suggesting it was simply empty rhetoric – it seems the safe bet is that cooler heads prevail behind closed doors.

Fight back

President Trump often thinks people are being “unfair” to him. His impetus for calling for NAFTA renegotiation was because it was unfair to manufacturers, and the U.S. wasn’t going to take it anymore. We can expect him to take more swings at NAFTA at his persistent campaign rallies and obviously on Twitter. Does that impact the negotiations? Doubtful. Experts point to the fact that Congress passed a trade implementation bill around NAFTA that would need to be dealt with before Trump could truly pull the U.S. out.

Deliver the goods

Commentators suggest Mexico and Canada will likely concede small things to give Trump a political win back home, but they won’t give away the store. Trump will get tweaks and must declare victory, which is not what he set out to do. Otherwise, he will walk away with no agreement delivered.

Contain the costs

When all is said and done, these negotiations will have cost a lot. If these talks last for longer than Trump hoped, he will be accused of running up the bill for not a lot of return on investment.

Have fun

Trade deals are not ‘fun’. This is an exercise in pouring over countless pieces of paper to amend the wording of an existing agreement that has trillions of dollars on the line. Trump’s rallies may give him an adrenaline boost that thrills him, however, NAFTA should not be a political football. This is a deal that creates many jobs and puts the food on many families’ tables.

Some commentated that Lighthizer’s opening remarks in round one in Washington, “We feel that NAFTA has fundamentally failed many, many Americans and needs major improvement,” sounded as if Trump wrote it himself on the back of a napkin for his Trade Negotiator to toss in.

The President’s fingerprints are present in the negotiations and his unpredictability looms all around it. His Apprentice persona was built as a deal-maker, and now his worldview is being put to the test.

The Art of the Deal – an undeniable major influence on negotiations in the private sector over the last few decades – now sits on the shelf as perhaps Trump’s best legacy.

Then again, he didn’t even write the thing.

(As published in Loonie Politics on September 23, 2017)[:]

The Hunt for an Opposition Leader: Who will the NDP choose to chart their path to power?

,

[:en]

In a campaign that is struggling to attract attention outside of NDP circles, our NDP insider Sally Houser lays out the issues and discusses the four candidates and their vision for the party.

On September 18 members of the New Democratic Party of Canada began casting their ballots for a new leader. Although the four candidates made their final pitch to voting members at a “Leadership Showcase” in Hamilton on September 17, it may be as late as October 15 before a winner is decided; the party’s new voting system allows a full week in between ballots to allow candidates to woo the supporters of whoever comes last in the rounds. A candidate needs to win with 50% +1, so we could have a winner on October 1, 8, or 15.

Though the leadership race has not been characterized by wildly differentiated policy proposals, there have been some ideas floated that makes each candidate stand out:

  • Singh has called for the decriminalization of the possession of all drugs
  • Caron committed to bringing in a guaranteed income for all Canadians
  • Ashton has promised free post-secondary education
  • Angus plans to dismantle Indigenous and Northern Affairs Canada (INAC)

Climate change talk has ranged from Ashton as the most vehemently opposed to any new pipelines to Angus who, while hardly crying “drill baby drill”, is asking New Democrats to think about transitioning to a renewable economy without throwing a generation of oil and gas workers under the bus.

Meet The Candidates – Who are they and how will they fare?

Charlie Angus – The ‘Prominent and Stable’ Choice
Elected in 2008 to represent the Riding of Timmins-James Bay in Northern Ontario, Angus has been a prominent and often quoted fixture in the NDP caucus. He has significant support among long time party members as well as outside the urban centres. Expected to finish in the top two on the first ballot, it will be crucial for him whether it is Ashton or Caron that gets knocked out in the first round as many of Caron’s supporters view Angus as their second choice.

 
Niki Ashton – The ‘Millennial and Young Woman’ Choice
Ashton is the only candidate in the race to be taking a second crack at leadership, having run to replace Jack Layton in the 2012. She has a significant amount of support from millennials, particularly young woman. Though her fundraising has been good, her campaign has had some stumbles and seems to be running out of gas. She placed last in the 2012 contest. Her team will have to work hard to get those millennials voting to ensure she doesn’t suffer the same fate this time around.

Guy Caron – The ‘Slow and Steady’ Choice
Elected in Jack Layton’s Quebec orange wave of 2011, Caron represents the riding of Rimouski. His campaign started slow, initially posting poor fundraising numbers but in recent weeks significant endorsements from well-known and respected New Democrats have given him some momentum. Coming on strong in the end game may be enough to edge out Ashton and avoid coming last on the first ballot. He has a lot of second choice support so if he stays in he does have an outside chance to come up the middle.

Jagmeet Singh – The ‘Toe to Toe with Trudeau’ Choice
Singh represents the riding of Bramalea-Gore-Malton in the Ontario legislature and has served as the Deputy Leader of the Ontario NDP. He has positioned himself as the candidate that can best grow the flagging NDP membership base and can go toe-to-toe with Justin Trudeau on flash and style. His team claims that they have signed up 47,000 new members. If those numbers ring true and they’re able to motivate those new members to vote, he could get close enough to 50% on the first ballot to make a win virtually guaranteed. If his vote isn’t motivated, he may not have enough second-choice support to take him over the edge. [:]